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Brookchester v. Matthews

Decided: March 22, 1972.

BROOKCHESTER INC., A NEW JERSEY CORPORATION, PLAINTIFF,
v.
MARIE MATTHEWS, DEFENDANT



Huot, J.d.c.

Huot

This is a landlord-tenant action to dispossess on the grounds of nonpayment of rent. Defendant contends that the landlord has violated the recently promulgated wage price guidelines and that by reason thereof the rent reserved in her lease is a nullity; that the rent is not owing and that this action should be dismissed.

The issues raised are:

1. Has jurisdiction to determine compliance or noncompliance with Price Commission regulations been preempted by the United States Government to a United States agency or court or does this court have jurisdiction, in a summary dispossess action for nonpayment of rent, to review the landlord's acts and determine compliance or noncompliance with the Price Commission regulations?

2. If this court has jurisdiction, do the regulations of November 12 or December 16, 1971 control?

3. If this court has such jurisdiction, has the landlord complied with the federal regulation?

I

The United States Congress adopted the Economic Stabilization Act of 1970 and the President approved the same on August 15, 1970. P.L. 91-379. It authorized the President:

To issue such orders and regulations as he may deem appropriate to stabilize prices, rents, wages and salaries at levels not less than those prevailing on May 25, 1970.

It further permitted the President to:

Delegate the performance of any function * * * to such officers, departments, and agencies of the United States as he may deem appropriate.

The authority therein granted was to expire on February 28, 1971.

On December 17, 1970 that authority was extended to March 31, 1971 (P.L. 91-558), and on March 30, 1971 extended to May 31, 1971 (P.L. 92-8). It was again extended by the Congress on May 18, 1971, so that the new expiration date is April 30, 1972, P.L. 92-15.

Pursuant to this statutory authority the President issued Executive Order No. 11615 on August 17, 1971 to stabilize prices, rents, wages and salaries for a period of 90 days and established a Cost of Living Council.

On October 15, 1971 the President issued, pursuant to such statute, Executive Order No. 11627, which established a Pay Board and Price Commission to "take such steps as may be necessary, and authorized by or pursuant to this Order, to stabilize prices, rents, wages and salaries." It continued the Cost of Living Council and set forth its duties and powers. Among these powers was:

Section 4(b). The Council may redelegate to any agency, instrumentality, or official of the United States any authority under this Order, and may, in administering this Order, utilize the services of any other agency, Federal or State, as may be available and appropriate.

Thereafter, the Price Commission promulgated Rules and regulations. On November 12, 1971, the Price Commission adopted Chapter III, Part 300, "Price and Rent Stabilization Regulations," which became effective November 14, 1971. Section 300.001, "Summary," reads:

The rules contained in this subpart relate to increases in prices and rents which are allowable after November 13, 1971, with respect to:

(c) Sales and leases of real property.

The several sections which establish the base price and formula for rentals will be discussed below. It will be seen, however, that the lease here in question is governed by these rules with respect to the amount of rent that plaintiff may charge.

In the present matter the tenant claims a violation of those regulations by the landlord, and our present inquiry is what jurisdiction shall make such determination.

A review of the rules and regulations leads the court to conclude that it may entertain the defense of lack of compliance with the regulations governing rent charges. ...


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