On certification to the Superior Court, Appellate Division, whose opinion is reported at 253 N.J. Super. 459 (1992).
Stein, Wilentz, Clifford, Handler, Pollock, O'Hern, Garibaldi
The opinion of the court was delivered by
This appeal concerns the due-process rights of developmentally-disabled persons who challenge placement decisions made by the New Jersey Department of Human Services' Division of Developmental Disabilities (Division or DDD). The parents of a profoundly-retarded young man opposed the DDD's decision to transfer their son to a new residence. They initiated the administrative-appeals procedure set forth in N.J.A.C. 10:48-1.1 to -1.6, claiming that the new facility was not the most appropriate placement for their son. In accordance with the DDD's regulations, the parents' challenge proceeded through several levels of agency review. Ultimately, the Division denied the parents' request to return their son to his original placement. The Appellate Division affirmed the DDD's decision but remanded and directed the Division to disclose all information concerning its placement decision. We granted certification, 130 N.J. 12 (1992), to consider whether the interests and issues present in placement appeals require greater procedural protections than those afforded by the agency process.
Mr. and Mrs. J.E. are the parents and legal guardians of G.E., a twenty-three-year old suffering from profound retardation, psychosis, autism, and hyperactivity. As a result of his condition, G.E. engages in maladaptive, attention-seeking, destructive behavior and requires twenty-four-hour supervision.
Because he needs constant monitoring, G.E. has been institutionalized for most of his life. In 1976, at the age of eight, G.E. began residing at the Woods School (Woods) in Langhorne, Pennsylvania. The Department of Human Services' Division of Youth and Family Services initially funded that placement. Once G.E. turned eighteen years old, the Fair Lawn Board of Education assumed the costs of G.E.'s continued residence at Woods.
On reaching majority, G.E. was no longer entitled to educational services through his local school board. However, G.E. was eligible as an adult for functional services from the DDD. After the Division had assumed responsibility for G.E.'s care, a DDD case manager evaluated G.E. and recommended that he remain at Woods as a purchase-of-care placement.
Despite the case manager's recommendation, the Division notified the parents of its plans to relocate G.E. to the New Lisbon Developmental Center (NLDC) in New Lisbon, New Jersey. The parents opposed the transfer. In June 1989, the parents filed a verified complaint and order to show cause in the Chancery Division seeking to enjoin the relocation and compel the DDD to fund G.E.'s placement at Woods. The Chancery Division ordered the DDD to fund G.E.'s stay at Woods until July 10, 1989, or until he was transferred to NLDC, whichever first occurred. On July 6, 1989, G.E. was moved to NLDC, where he continues to reside.
Following G.E.'s transfer to NLDC, the parents dismissed their pending action and initiated the administrative-appeals procedure set forth in N.J.A.C. 10:48-1.1 to -1.6. In accordance with the DDD's regulations, N.J.A.C. 10:48-1.3, the parents requested an informal conference seeking G.E.'s return to Woods, a placement that they viewed as the most appropriate for their son.
The informal conference was held in January 1990, at NLDC, before Philip Conti, Supervising Residential Service Specialist. At the conference, the parents were given the opportunity to voice their concerns regarding G.E.'s placement at NLDC. They were allowed to present the expert testimony of F. Charles Mace, Ph.D., who compared the physical facilities and habilitative programs at both Woods and NLDC. However, G.E.'s parents were denied legal representation and no transcript of the proceeding was made. N.J.A.C. 10:48-1.3(d)(1), (4). Following the conference, Conti denied the parents' request to transfer G.E. to Woods, finding that G.E.'s needs were being met adequately at NLDC.
The parents appealed Conti's decision to the Director of the DDD, Dr. Robert Nicholas. N.J.A.C. 10:48-1.4(a). Dr. Nicholas determined the matter to be "uncontested" and referred the case for administrative review. N.J.A.C. 10:48-1.1(h), -1.4(b). In preparation for the administrative-review conference, the parents requested access to documents in G.E.'s file concerning the Division's decision to place their son at NLDC. Those documents included the case manager's recommendation that G.E. remain at Woods as a purchase-of-care placement. The DDD denied the request, claiming that the documents were non-discoverable, intra-agency communications under N.J.A.C. 10:41-2.8(b)(2).
The administrative-review conference was held in May 1990, before Russell Carlini, a review officer appointed by the DDD. N.J.A.C. 10:48-1.6(a). At that stage of the appeals process, the parents were allowed legal representation and limited discovery. N.J.A.C. 10:48-1.6(c)(2), (6). Both parties were given the opportunity to introduce evidence, present testimony, and cross-examine witnesses. N.J.A.C. 10:48-1.6(c)(7). In addition, a transcript of the proceeding was made. N.J.A.C. 10:48-1.6(c)(4).
Philip Conti, who had presided at the informal conference conducted in January and had ruled against G.E.'s parents, presented the Division's position during the administrative-review conference. The Division argued that G.E.'s needs were being met adequately at NLDC, supporting its contentions with the testimony of G.E.'s Social Worker and Habilitation Planning Coordinator at NLDC. Both witnesses testified that G.E. had adjusted well to NLDC. However, neither witness was familiar with Woods, and neither could compare G.E.'s adjustment at NLDC with his progress at Woods. In addition, because they lacked subpoena power, G.E.'s parents were unable to question NLDC direct-care staff members who had worked with G.E. on a daily basis.
The parents' argument focused primarily on the quality of the placement to which their son was entitled. The parents claimed that G.E. was entitled to not merely an adequate placement but rather was guaranteed the most appropriate placement, the placement that would offer the maximum enhancement of his developmental potential in the least-restrictive environment. See N.J.S.A. 30:4-24.2, 30:4-25.6, 30:6D-9, and N.J.A.C. 10:47-6.2. According to the parents, G.E. was being denied his statutory rights because Woods offered a more-appropriate and less-restrictive setting than NLDC.
Additionally, the parents objected to Dr. Nicholas' classification of the dispute as "uncontested." N.J.A.C. 10:48-1.2. The parents argued that challenges to placement decisions are "contested matters" and therefore should be transferred to the Office of Administrative Law (OAL) for a hearing conducted in accordance with the Administrative Procedures Act (APA), N.J.S.A. 52:14B-1 to -15. N.J.A.C. 10:48-1.5. Finally, the parents argued that the DDD should bear the initial burden of proving the appropriateness of a placement decision.
Following the parties' presentations, the parents requested that the record be held open because none of the Division's witnesses had knowledge of the standards used to determine the most appropriate placement for a DDD client. Agreeing that this information was critical to the parents' case, the review officer adjourned the hearing until that issue could be addressed.
The administrative review was completed by telephone conference in June 1990. Dr. Gwen Brown, Assistant Director of Residential Services for the DDD, explained the procedure followed in determining which of ten developmental centers is the most appropriate for a service recipient. Dr. Brown, however, was unable to answer the parents' questions concerning the standards used by the Division in deciding initially whether a client should be placed in a developmental center, such as NLDC, or a purchase-of-care facility, such as Woods. Once again, ...