State Constitutional Law - Freedom of Speech - New Jersey Supreme Court Holds That Restrictions in Common Interest Community Do Not Violate the State's Constitution

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STATE CONSTITUTIONAL LAW--FREEDOM OF SPEECH--NEW JERSEY SUPREME COURT HOLDS THAT RESTRICTIONS IN COMMON INTEREST COMMUNITY DO NOT VIOLATE THE STATE'S CONSTITUTION.--Committee for a Better Twin Rivers v. Twin Rivers Homeowners' Ass'n, 929 A.2d 1060 (N.J. 2007).

The rise to prominence of common interest communities (1) (CICs) is an immutable reality of modern residential patterns. (2) Since these communities require residents to abide by exacting rules and regulations, clashes between homeowners' associations fashioning CIC restrictions and residents subject to those restrictions are somewhat inevitable. While the Supreme Court has held municipal strictures on residential signs unconstitutional, (3) analogous restrictions persist unfettered in CICs nationwide. (4) Recently, in Committee for a Better Twin Rivers v. Twin Rivers Homeowners' Ass'n, (5) the Supreme Court of New Jersey held that a homeowners' association did not violate its members' state constitutional rights by restricting their ability to erect signs, use a community room, and publish in the local newspaper.(6) To reach this conclusion, the court misapplied the test it had previously fashioned to balance competing constitutional and property interests, and in so doing, detracted from New Jersey's broad freedom of speech protections and contravened the values espoused by its own precedent.

Twin Rivers is a CIC composed of privately owned residences and commercial buildings. (7) Although the community is not gated and has public roads, its facilities are for the exclusive use of residents and their guests. (8) The Twin Rivers Community Trust, a private corporation that owns and maintains the community's common property, has as its sole trustee the Twin Rivers Homeowners' Association (9) (TRHA), whose membership consists of all Twin Rivers property owners. (10) The TRHA makes rules and regulations that govern the conduct of its members, maintains communal facilities, and provides services to its members. (11)

A group of dissident residents formed the Committee for a Better Twin Rivers, (12) which sued for relief from several such provisions in New Jersey state court. (13) The plaintiffs took issue with rules limiting the ability of residents to post signs, use the community room, and publish in the local newspaper. (14) They argued that since the TRHA had effectively supplanted the municipality as the government of Twin Rivers, TRHA rules ought to be subject to the free speech and free association clauses (15) of the New Jersey Constitution. (16)

The trial court granted summary judgment for the defendants on the sign and newspaper claims and granted partial relief to the plaintiffs on the community room claim. (17) The court reasoned that, in spite of the TRHA's influence in the daily lives of its members, the TRHA had not been delegated sufficient governmental powers to be considered a quasimunicipality. (18) As such, the TRHA could not be bound by the constitutional strictures imposed on state actors. (19) The court described the relationship between the parties as a contractual one (20) meriting business judgment analysis, not constitutional scrutiny. (21)

The appellate division reversed and remanded, (22) holding that the trial court's focus on whether a governmental entity had officially delegated power to the TRHA was misguided. (23) The trial court ignored the fact that the protections of free expression in the New Jersey Constitution have been applied more broadly than just to public sec-tor actors. (24) The applicability of these New Jersey constitutional provisions to a given actor--in this case, the TRHA--is determined not by quasi-municipal status, but by a test articulated in State v. Schmid (25) and New Jersey Coalition Against War in the Middle East v. J.M.B. Realty Corp. (26) Working within this Schmid-Coalition framework, (27) the court concluded that the balance of interests weighed in favor of the plaintiffs' right to engage in expressive activity. …