This action comes before the court by way of an order to show cause. Plaintiffs are a bondholder and taxpayers residing in the Township of Millburn. Defendant is the Board of Education of Millburn. This dispute has arisen over the proposed action of defendant board to close the Washington Elementary School and lease it to the State Department of Education for use as a school for the hearing handicapped. There being no factual disputes, but only questions of law, the action is being resolved on cross-motions for summary judgment.
Washington School was constructed in 1968 with funds from a multi-purpose school bond issue. Construction was approved by a referendum on January 24, 1967 which "authorized" the board of education "to construct a new elementary schoolhouse to be designated as Washington School." The same referendum also authorized defendant to purchase land and embark on other construction projects not connected with the Washington School. The total amount of bonds authorized was $2,870,000. This amount was greatly in
excess of the sum needed for construction of Washington School. The bonds themselves do not specify for what purposes the money is to be used, except to say they were authorized by virtue of the January 24, 1967 referendum. The bonds contain no express covenants restricting the use of the Washington School building for use as an elementary school.
Plaintiffs challenge the proposed lease of the school to the State, asserting that once a capital project is approved by the voters and constructed, its use may not be changed as long as there remains an outstanding debt for the structure. The only exceptions plaintiffs would permit to the change of use would be if the change is approved by the voters at a referendum or if the building remains unused. Plaintiffs therefore argue that the board of education has only three alternatives with regard to the use of this still bond-indebted structure: (1) use it as an elementary school, (2) vacate the building and have it remain unused, or (3) get voter approval to change the use. Plaintiffs' argument would also preclude the use of the school structure as a high school or a junior high school without voter approval.
Defendant has raised two grounds upon which it contends the court should not hear this controversy on the merits. These grounds are lack of standing on the part of plaintiffs to maintain this action and plaintiffs' failure to exhaust their available administrative remedies.
Plaintiffs have standing to maintain the action under the New Jersey courts' liberal approach to the issue of standing. In Crescent Park Tenants Ass'n v. Realty Equity Corp. of N.Y. Park Ass'n, 58 N.J. 98 (1971), our Supreme Court noted that the courts in New Jersey will not entertain proceedings by plaintiffs who are mere "intermeddlers" or "interlopers" or "strangers" to the dispute. The court went on to say:
Without ever becoming enmeshed in the Federal complexities and technicalities, we have appropriately confined litigation to those situations where the litigant's concern with the subject matter evidenced a sufficient stake and real adverseness. In the overall we
have given due weight to the interests of individual justice, along with the public interest, always bearing in mind that throughout our law we have been sweepingly rejecting procedural frustrations in favor of just and expeditious determinations on the ultimate merits. [at 107, 108; citations omitted]
The record is clear that plaintiffs are not strangers to the dispute nor intermeddlers, but rather they represent their own personal interest and the public interest of the community in the resolution of the dispute over the closing of this school. Plaintiffs have evidenced a sufficient stake and a real adverseness to entitle them to standing in this controversy.
Furthermore, it is not necessary for plaintiffs to exhaust their administrative remedies before a judicial review of this controversy. This court recognizes that the Commissioner of Education has jurisdiction to hear and determine controversies that arise pursuant to his powers under N.J.S.A. 18A:6-9. The court is also mindful of the fact that in most circumstances, before there may be a judicial review of a school board's decision, there must be an exhaustion of administrative procedures unless the interests of justice require otherwise. See East Brunswick Bd. of Ed. v. East Brunswick Tp. Council, 48 N.J. 94 (1966). However, our Supreme Court stated in Matawan v. Monmouth Cty. Tax Board, 51 N.J. 291 (1968), that when an issue to be decided is solely a question of law, the doctrine of exhaustion of administrative remedies is not applicable. This question was also ...