In the Matter of Marilyn Roman and Sudhan Thomas, Etc.

• Court: New Jersey Superior Court Appellate Division
• Decided: December 21, 2023
• Docket: A-2858-21
• Status: Unpublished

Opinion

NOT FOR PUBLICATION WITHOUT THE APPROVAL OF THE APPELLATE DIVISION This opinion shall not "constitute precedent or be binding upon any court ." Although it is posted on the internet, this opinion is binding only on the parties in the case and its use in other cases is limited. R. 1:36-3.

SUPERIOR COURT OF NEW JERSEY APPELLATE DIVISION DOCKET NO. A-2858-21

IN THE MATTER OF MARILYN ROMAN AND SUDHAN THOMAS, and JERSEY CITY BOARD OF EDUCATION, HUDSON COUNTY. _______________________

Argued December 5, 2023 – Decided December 21, 2023

Before Judges Sumners and Perez Friscia.

On appeal from the New Jersey Commissioner of Education, Docket No. 1-1/22A.

David B. Rubin argued the cause for appellants Marilyn Roman and Sudhan Thomas (David B. Rubin, PC, attorneys; David B. Rubin, of counsel and on the briefs; Ellen S. Bass, on the briefs).

Sadia Ahsanuddin, Deputy Attorney General, argued the cause for respondent the Commissioner of Education (Matthew J. Platkin Attorney General, attorney; Donna Sue Arons, Assistant Attorney General, of counsel; Sadia Ahsanuddin, on the brief).

Carl Tanksley Jr., General Counsel, attorney for amicus curiae New Jersey School Boards Association (Carl Tanksley Jr., on the brief). PER CURIAM

Appellants Marilyn Roman and Sudhan Thomas appeal from the May 19,

2022 New Jersey Commissioner of Education's (Commissioner) final decision,

which found they had violated N.J.S.A. 18A:12-24(c), a provision of the School

Ethics Act (SEA), N.J.S.A. 18A:12-21 to -34, and issued the penalty of a

reprimand, accepting the School Ethics Commission's (SEC) adoption of the

Administrative Law Judge's (ALJ) initial decision. Appellants, former Jersey

City Board of Education (Board) members, argue they did not violate the SEA

by voting to approve a settlement regarding actions in which they were

personally named. Alternatively, if they erred in voting, the reprimand was

erroneously imposed because they had followed the advice of counsel. For the

following reasons, we affirm appellants' violation of N.J.S.A. 18A:12-24(c),

reverse the reprimand, and remand to the Commissioner to vacate the penalty.

I.

We discern the following facts from the record. Jersey City

Superintendent of Schools Marcia Lyles filed a federal lawsuit against the

Board, Thomas, Roman, and other defendants. Lyles alleged hostile work

environment and tortious interference, among other claims. Specifically, Lyles

claimed that Board President Thomas and Roman "engaged in a pattern of

A-2858-21 2 harassment and misconduct towards [her], culminating on January 2, 2019, with

an unlawful Board [r]esolution of non-renewal of her contract." Further, she

alleged they purposely acted to publicly "embarrass and defame" her.

Lyles also filed an administrative action before the Commissioner, which

named the Board and Thomas as defendants. Lyles alleged the Board, and

specifically Thomas, demonstrated "unlawful bias" and "unethical behavior"

against her. An ALJ later dismissed the administrative action as to Thomas.

Appellants were provided indemnification and counsel by the Board in the

respective actions. A global settlement of the federal lawsuit and the

administrative action was later reached. Appellants individually signed the

settlement agreement. Several days later, the Board, including Thomas and

Roman, voted to approve the settlement agreement.

Almost eight months later, Matthew Shapiro, a Board member, filed a

complaint with the SEC alleging that appellants violated the SEA by

"affirmatively vot[ing] to settle the lawsuit in which they were individually

named and at risk of damages." Specifically, Shapiro alleged that appellants

violated N.J.S.A. 18A:12-24(c) by voting in favor of the settlement, which

"served their own personal interests to get themselves out of that lawsuit (at no

personal penalty)." Shapiro also contended that appellants violated N.J.S.A.

A-2858-21 3 18A:12-24.1(e) by "signing the settlement documents as individual agents and

then voting on the settlement documents as board trustees," which amounted to

"private action with the potential to compromise the [B]oard."

Appellants moved to dismiss the complaint, which was denied by the SEC.

Appellants filed an answer to Shapiro's complaint followed by the SEC issuing

a notice: finding "probable cause to credit the allegations that [appellants]

violated N.J.S.A. 18A:12-24(c) and N.J.S.A. 18A:12-24.1(e)"; transferring the

matter to the Office of Administrative Law for a hearing; substituting the SEC

as the complainant for Shapiro; and providing the SEC's attorney, pursuant to

N.J.A.C. 6A:28-10.7(b)(1), would prosecute the matter. Thereafter, the matter

proceeded before an ALJ.

Following discovery, the SEC and appellants cross-moved for a summary

decision relying on a joint stipulation of facts. Paragraph eight of the stipulation

provided that the "Board voted to approve a written settlement agreement

settling both the federal court and administrative proceedings. . . . [Appellants]

were both present and voted in favor of approving the settlement." Paragraph

nine provided that, before voting on the settlement agreement, "[appellants]

consulted with the Board of Education's [g]eneral [c]ounsel . . . who explicitly

advised them that there was no ethical impediment to their voting on the matter

A-2858-21 4 or signing the settlement agreement." Before the ALJ, appellants argued they

did not commit an ethical violation because they only voted on the settlement

after the Board's counsel separately advised them that no conflict would prevent

them from voting.

In an initial decision, the ALJ partially granted appellants' motion for a

summary decision, finding no violation under N.J.S.A. 18A:12-24.1(e); and

partially granted the SEC's motion, finding appellants violated N.J.S.A. 18A:12-

24(c). The ALJ found that appellants did not violate N.J.S.A. 18A:12-24.1(e)

because "no conduct asserted suggest[ed] [appellants] made promises to anyone

concerning" the "voting upon or execut[ion] [of] the settlement agreement."

However, the ALJ found appellants violated N.J.S.A. 18A:12-24(c), reasoning

that although they "evidenced sensitivity to the issue of potential conflict in

seeking counsel's advice," and it was "reasonable to rely upon such advice," "a

public member could justifiably believe that their objectivity was impaired when

voting upon and executing the agreement." Further, the ALJ found that

appellants "acted in their official capacity in a matter where they had personal

involvement and received a benefit in violation of N.J.S.A. 18A:12-24(c)"

because "[u]nder the settlement agreement terms, Lyles agreed not to sue Roman

A-2858-21 5 or Thomas and release[d] them from all claims or actions she could bring against

them."

The ALJ considered the Board's counsel's certification that he did not

recall giving advice, but he would have intervened if he believed a conflict

existed. Further, if asked, he "likely would have told them that he saw no

problem because they were being completely indemnified by the school district,

as required by statute, and were not securing any personal benefit." He further

certified that, in his view, there were no ethical problems with their voting. The

ALJ recommended the penalty of a reprimand for appellants' violation of

N.J.S.A. 18A:12-24(c).

The SEC, substantially for the same reasons, adopted the ALJ's findings

that appellants violated N.J.S.A. 18A:12-24(c) but did not violate N.J.S.A. 12-

24.1(e). The SEC also adopted the ALJ's recommended penalty of a reprimand.

Appellants appealed the SEC's decision to the Commissioner of Education,

which the SEC opposed.

The Commissioner issued a final decision affirming the SEC's decision.

Given Lyles's claims that appellants "acted improperly, including by engaging

in a pattern of misconduct and harassment," the Commissioner found appellants'

"interest in resolving the claims [wa]s not one fully shared with the public."

A-2858-21 6 Additionally, the Commissioner found that the public could "justifiably believe"

appellants' "objectivity was impaired when voting to approve the settlement."

The "fact that [appellants] were financially indemnified for the costs of the

[actions] and settlement," the Commissioner found, was not "determinative"

because the "financial costs [we]re not the only benefit to settling [the actions]."

Finally, the Commissioner found the "lesser penalty" of a reprimand was

appropriate considering appellants settled the actions involving "the [B]oard as

a whole rather than . . . individual ethics charges" and because appellants had

relied on the advice of counsel.

Before us, appellants argue the Commissioner's decision erroneously:

expanded the meaning of N.J.S.A. 18A:12-24(c) to find appellants committed a

violation; committed de facto rulemaking under N.J.S.A. 18A:12-24(c); and

rejected appellants' advice of counsel defense.

New Jersey School Boards Association, appearing as amicus curiae,

supports appellants' position, arguing because "no greater benefit accrued to

these [B]oard members than that which could reasonably be expected to accrue

to other members of the board, no conflict and therefore no penalty should be

assessed." Amicus also posits the Commissioner's "portion of the decision

imposing a penalty on these board members" should be reversed.

A-2858-21 7 II.

"Judicial review of agency determinations is limited." Allstars Auto Grp.,

Inc. v. N.J. Motor Vehicle Comm'n, 234 N.J. 150, 157 (2018). "An

administrative agency's final quasi-judicial decision will be sustained unless

there is a clear showing that it is arbitrary, capricious, or unreasonable, or that

it lacks fair support in the record." In re Herrmann, 192 N.J. 19, 27-28 (2007).

"Courts afford an agency 'great deference' in reviewing [the agency's]

'interpretation of statutes within its scope of authority.'" N.J. Ass'n of Sch.

Adm'rs v. Schundler, 211 N.J. 535, 549 (2012) (quoting N.J. Soc'y for the

Prevention of Cruelty to Animals v. N.J. Dep't of Agric., 196 N.J. 366, 385

(2008)). "Nonetheless, 'when an agency's decision is based on the "agency's

interpretation of a statute or its determination of a strictly legal issue," we are

not bound by the agency's interpretation.'" In re Ridgefield Park Bd. of Educ.,

244 N.J. 1, 17 (2020) (quoting Saccone v. Bd. of Trs., Police & Firemen's Ret.

Sys., 219 N.J. 369, 380 (2014)).

To effectuate the Legislature's intent when interpreting a statute, a court

must first examine the plain language and ascribe to its words their ordinary

meaning. Conforti v. County of Ocean, 255 N.J. 142, 163 (2023). "Where

statutory language is clear, courts should give it effect unless it is evident that

A-2858-21 8 the Legislature did not intend such meaning." Bubis v. Kassin, 184 N.J. 612,

626 (2005) (quoting Rumson Ests., Inc. v. Mayor of Fair Haven, 177 N.J. 338,

354 (2003)). We "ascribe[] to the statutory words their ordinary meaning and

significance and read[] them in context with related provisions so as to give

sense to the legislation as a whole." W.S. v. Hildreth, 252 N.J. 506, 518 (2023)

(quoting DiProspero v. Penn, 183 N.J. 477, 492 (2005)). "If the language [of a

statute] is clear, the court's job is complete." In re DiGuglielmo, 252 N.J. 350,

360 (2022) (quoting In re Expungement Application of D.J.B., 216 N.J. 433,

440 (2014)). We review statutory interpretation de novo. In re Registrant H.D.,

241 N.J. 412, 418 (2020).

In enacting the SEA, "the Legislature declared its intention 'to ensure and

preserve public confidence' in local school board members by providing local

board members with advance guidance on ethical conduct so that such members

might conduct their personal affairs appropriately and within the bounds

ethically expected." Bd. of Educ. of Sea Isle City v. Kennedy, 196 N.J. 1, 16

(2008) (citation omitted) (first quoting N.J.S.A. 18A:12-22; and then citing

N.J.S.A.18A:12-24(j)). N.J.S.A. 18A:12-24(j) states, "Nothing shall prohibit

any school official, or members of his immediate family, from representing

A-2858-21 9 himself, or themselves, in negotiations or proceedings concerning his, or their,

own interests." N.J.S.A. 18A:12-24(c) states:

No school official shall act in his official capacity in any matter where he, a member of his immediate family, or a business organization in which he has an interest, has a direct or indirect financial involvement that might reasonably be expected to impair his objectivity or independence of judgment. No school official shall act in his official capacity in any matter where he or a member of his immediate family has a personal involvement that is or creates some benefit to the school official or member of his immediate family.

Our Supreme Court has held that, under the common law, "[a] public

official is disqualified from participating in judicial or quasi-judicial

proceedings in which the official has a conflicting interest that may interfere

with the impartial performance of his duties as a member of the public body."

Wyzykowski v. Rizas, 132 N.J. 509, 523 (1993) (alteration in original) (quoting

Scotch Plains-Fanwood Bd. of Educ. v. Syvertsen, 251 N.J. Super. 566, 568

(App. Div. 1991)). A determination of "[w]hether a particular interest is sufficient

to disqualify is necessarily a factual one and depends on the circumstances of the

particular case." Paruszewski v. Township of Elsinboro, 154 N.J. 45, 58 (1998)

(quoting Wyzykowski, 132 N.J. at 523). "The question is whether there is a potential

for conflict, not whether the conflicting interest actually influenced the action."

A-2858-21 10 Haggerty v. Red Bank Borough Zoning Bd. of Adjustment, 385 N.J. Super. 501, 513

(App. Div. 2006) (citing Wyzykowski, 132 N.J. at 523).

II.

The plain language of N.J.S.A. 18A:12-24(c) prohibits a board member

from "act[ing] in his official capacity in any matter where he . . . has an interest,

has a direct or indirect financial involvement that might reasonably be expected

to impair his objectivity or independence of judgment" and from "act[ing] in his

official capacity in any matter where he . . . has a personal involvement that is

or creates some benefit to the school official." Ibid. The legislative intent is

clear that board members shall not participate in a matter where they have an

interest that may interfere with their impartial performance. We therefore

concur with the Commissioner that appellants had a statutory conflict of interest

under N.J.S.A. 18A:12-24(c) as defendants in Lyles's complaint, which alleged

their explicit unethical and harassing misconduct. Thus, their voting on the

settlement agreement was prohibited. As the Commissioner found, Lyles's

complaint asserted claims against appellants for "personally" and "separately"

acting "improperly" outside of their membership on the Board. The

Commissioner's finding that appellants' "interest[s] . . . [were] not . . . fully

shared with the public" was supported by the "substantial credible evidence."

A-2858-21 11 Appellants' arguments that they had no interest in the outcome of the

actions because they were fully indemnified, had appointed counsel, and were

only sued "for dramatic effect" are unpersuasive. Appellants derived a benefit

from settling the actions which released them from all claims and terminated

their personal involvement. We discern no reason to disturb the Commissioner's

finding that under the plain language of N.J.S.A. 18A:12-24(c), appellants acted

in their official capacities on a matter where they had "a personal involvement

that . . . create[d] some benefit."

Further, we decline to address appellants' argument, raised for the first

time on appeal, that the Commissioner's determination on N.J.S.A. 18A:12-

24(c) "expanded the meaning and interpretation" of the provision "in a manner

that constitute[d] rulemaking and [wa]s thus noncompliant with the APA." See

Zaman v. Felton, 219 N.J. 199, 226-27 (2014) (recognizing claims that are not

presented to a trial court are inappropriate for consideration on appeal).

We, however, part ways with the Commissioner's issuance of a reprimand.

We have previously considered four prerequisite factors to an advice of counsel

defense regarding an agency's decision on an ethical violation. See In re Zisa,

385 N.J. Super. 188, 198-99 (App. Div. 2006). They are: (1) "[t]hat the approval

or advice was received prior to the action being taken"; (2) "[t]hat the individual

A-2858-21 12 who offered the advice or approval relied upon possessed authority or

responsibility with regard to ethical issues"; (3) "[t]hat the individual seeking

advice or approval made a full disclosure of all pertinent facts and

circumstances"; and (4) "[t]hat the individual compl[ied] with the advice

received, including any restrictions it might contain." Ibid. (citations omitted).

Appellants squarely demonstrated all four prerequisites to avail of an

advice of counsel defense. It was stipulated that appellants each sought the

advice of the Board's counsel, who had the authority to provide advice, before

voting to approve the settlement. Appellants certified that they separately

consulted the Board's counsel about the propriety of voting on the settlement of

the actions in which they were named defendants. Thomas recalled discussing

with counsel whether he would have to sign the settlement agreement as Board

President and if that "pose[d] a[] conflict." Notably, the SEC stipulated that

counsel "explicitly advised them that there was no ethical impediment to their

voting on the matter or signing the settlement agreement." Appellants were

advised by informed counsel that there was no ethical barrier to their voting and

relied on that advice in approving the settlement, satisfying all four

prerequisites.

A-2858-21 13 Under N.J.S.A. 18A:12-29(f), the SEC "shall be authorized to determine

and impose the appropriate sanction including reprimand, censure, suspension[,]

or removal of the school official found to have violated [the SEA]." The plain

language of the provision does not foreclose the Commissioner from assessing

no penalty, as an "appropriate sanction includ[es]" but does not require the

penalty of "reprimand." See ibid. We note the Commissioner failed to

separately consider the four prerequisites elucidated in Zisa in "concur[ring]

with the ALJ and the SEC" regarding the penalty and finding the penalty

commensurate with appellants' reliance on counsel's advice. The application of

the advice of counsel defense requires a fact-sensitive analysis to determine if

the four prerequisites to an advice of counsel defense were met. Here, appellants

met all the conditions to warrant the defense of advice of counsel. See Zisa, 385

N.J. Super. at 199. Thus, we reverse the imposition of the penalty of a reprimand

and direct the Commissioner to vacate the penalty.

To the extent not addressed, appellants' remaining arguments lack

sufficient merit to warrant discussion in a written opinion. R. 2:11-3(e)(1)(E).

Affirmed in part, reversed in part, and remanded for further proceedings

consistent with this opinion. We do not retain jurisdiction.

A-2858-21 14