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Jones v. Haridor Realty Corp.

Decided: May 21, 1962.

ERMON K. JONES, CLAIMANT-RESPONDENT,
v.
THE HARIDOR REALTY CORP. T/A ASBURY GABLES, HAROLD STRAUSS, ARTHUR C. SAMUELS, ISADORE STRAUSS, RESPONDENTS-APPELLANTS



For affirmance -- Chief Justice Weintraub, and Justices Jacobs, Francis, Proctor, Hall, Schettino and Haneman. For reversal -- None. The opinion of the court was delivered by Francis, J.

Francis

The Commissioner of Education issued an order against the appellants, The Haridor Realty Corp., trading as Asbury Gables, Harold Strauss, Isadore Strauss and Arthur C. Samuels, for the purpose of remedying a violation by them of the Law Against Discrimination, N.J.S.A. 18:25-1 et seq. Appellants appealed to the Superior Court, Appellate Division, but before argument there the cause was certified by this court on our own motion.

Certain objections have been interposed to the procedural course pursued by appellants in seeking review in the

Appellate Division. Compare, R.R. 4:88-8(a) and N.J.S.A. 18:25-21. In view of the public importance of the substantive questions involved, we have concluded to pass the objections in order to reach a decision on the merits.

I.

The Haridor Realty Corp., trading as Asbury Gables, is a New York corporation registered to do business in New Jersey. At and prior to the incident which produced these proceedings, it was engaged in building one-family homes in a housing development in an area known as Asbury Gables, Monmouth County, New Jersey. The specific section of its operation appears on a land subdivision map entitled "Map of Asbury Gables West, Township of Neptune, Monmouth County, New Jersey," which was filed in the County Clerk's Office on October 3, 1957, after having been approved by the Township Committee. All or substantially all of the land covered by the map was acquired initially in the names of Harold Strauss and Isadore Strauss by deed dated November 22, 1957. During the period with which we are concerned, Harold Strauss was secretary and treasurer of Haridor and in active charge of management of the development; Isadore Strauss was the president. There is no doubt they controlled the corporation.

The entire site had Federal Housing Administration approval for home construction purposes. Haridor stipulated that it was subject to the Law Against Discrimination because it sold dwellings to buyers who financed their purchases through mortgage loans guaranteed by that Federal agency. Such use of public credit by both seller and purchaser draws the development into the category of publicly assisted housing accommodations. N.J.S.A. 18:25-4; Levitt & Sons, Inc. v. Div. Against Discrimination, etc., 31 N.J. 514 (1960), appeal dismissed 363 U.S. 418, 80 S. Ct. 1257; 4 L. Ed. 2 d 1515 (1960).

Haridor's method of operation was this: Three different types of model homes were built on the tract for inspection by prospective purchasers. The types were advertised for sale in the public press as representing houses available in Asbury Gables, a community "being developed by Isadore and Harold Strauss." And the public was told that purchases could be made with FHA mortgages. A sales office was maintained in one of the model homes where the appellant, Arthur C. Samuels, a real estate broker, acted as sales agent of Haridor. At this office the purchaser would select the type model home that appealed to him; then with Samuels' assistance he would select a location for it from the available building lots shown on the map of the development. This proceeding would be followed by the execution of the necessary papers to complete the transaction, including the FHA mortgage application (if that kind of mortgage was desired). Haridor would erect the dwelling. If the lot chosen by the purchaser was not already owned by Haridor, title was obtained from Harold and Isadore Strauss, its secretary-treasurer and president, who as individuals were the record owners of the tract. The proof shows clearly an arrangement between the individuals and their corporation whereby title to the lots would be conveyed to Haridor as they were needed to complete sales transactions with home buyers.

In June, August and October 1959, Ermon K. Jones visited the Asbury Gables development. On two occasions he was accompanied by his wife, Blanche, and one of their minor daughters. Jones talked with Samuels about the purchase of a home there, selected the type of home he liked, and requested and obtained an FHA mortgage application. The form was completed and sent to Haridor with the request for a meeting to complete the formal contract of sale. The evidence reveals beyond doubt that Jones' offer was refused because he is a Negro. It stands undenied that Harold Strauss said to an investigator of the Division on Civil Rights:

"No law or no one is going to force me to sell to a Negro a house in this development. * * * Now, if this man wants a house, let him find a plot and I'll build it for him. Before I will sell to a Negro ...


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