Sun Property Management, Inc. v. the Borough of Seaside Heights

New Jersey Superior Court Appellate Division·Decided July 20, 2026·No. A-2683-23·Unpublished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NOT FOR PUBLICATION WITHOUT THE APPROVAL OF THE APPELLATE DIVISION This opinion shall not "constitute precedent or be binding upon any court ."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-2683-23

SUN PROPERTY MANAGEMENT, INC., d/b/a SUNRISE MOTEL & MCGRATH FAMILY PARTNERSHIP INC., d/b/a HERSHEY MOTEL,

Plaintiffs-Appellants,

v.

THE BOROUGH OF SEASIDE HEIGHTS and THE BOROUGH COUNSEL OF THE BOROUGH OF SEASIDE HEIGHTS,

Defendants-Respondents.

Argued January 27, 2026 – Decided July 20, 2026 Before Judges Sumners, Susswein and Augostini.

On appeal from the Superior Court of New Jersey, Law Division, Ocean County, Docket No. L-0300-24.

Christopher R. Shea argued the cause for appellants (R.C. Shea & Associates, attorneys; Christopher R.

Shea, of counsel and on the briefs).

Kevin Riordan argued the cause for respondents (Kevin Riordan LLC and Rothstein Mandell Strohm Halm & Cipriani, attorneys; Kevin Riordan and Robin La Bue, on the briefs).

Trishka Waterbury Cecil argued the cause for amicus curiae New Jersey State League of Municipalities (Mason, Griffin & Pierson, PC, attorneys; Trishka Waterbury Cecil, of counsel and on the briefs).

Ezra D. Rosenberg argued the cause for amicus curiae American Civil Liberties Union of New Jersey Foundation (Ezra D. Rosenberg and Jeanne LoCicero, on the briefs).

PER CURIAM Plaintiff Sun Property Management, Inc., doing business as Sunrise Motel, appeals the April 12, 2024, Law Division order dismissing its complaint against defendant Borough of Seaside Heights (the Borough). In an attempt to curb disorderly behavior by young adults during prom and graduation season, in August 2023, the Borough enacted an ordinance (the Ordinance) raising the age to rent a hotel or motel room from eighteen to twenty-one between April 15 and June 30 of each year. Before the Ordinance went into effect, plaintiff brought this action, alleging that the Ordinance violates the rights of eighteen-to-twenty- one-year-olds seeking to rent a hotel room during the covered period. Specifically, plaintiff claimed the Ordinance constitutes unlawful age and race discrimination under the Law Against Discrimination (LAD), N.J.S.A. 10:5-1 to A-2683-23

-49; violates the substantive due process and equal protection rights of hotel customers under both the state and federal constitutions; and is impermissibly vague in that it fails to make clear what a hotel or motel must do to comply with its requirements.

We affirm the court's dismissal of plaintiff's LAD claims, vagueness claim, and federal constitutional claims, which the trial court properly rejected by upholding the Ordinance under rational basis review. However, we reverse the trial court's dismissal of plaintiff's equal protection and substantive due process claims under the New Jersey Constitution. Equal protection and substantive due process claims under the New Jersey Constitution are not analyzed under the rational basis, intermediate, and strict tiers of scrutiny, but rather a more flexible and fact-sensitive balancing test. Applying that test, we conclude that plaintiff has pled sufficient facts to state its claims under the New Jersey Constitution. We therefore remand for reasonable discovery—in the trial court's discretion—with respect to these claims.

I.

We discern the following facts and procedural history from the record.

On August 16, 2023, the Borough enacted the Ordinance, precluding persons under twenty-one years old from renting hotel or motel rooms during the "prom

A-2683-23

season" period between April and June. Specifically, the Ordinance provides, in relevant part:

§179-14 Regulations Pertaining to Hotels and Motels.

A. During the period commencing April 15 and ending at midnight on June 30 of each year, no room in a hotel or motel shall be rented to any person under [twenty-one] years of age. The primary occupant of each room shall be [twenty-one] years of age or older and must actually occupy the unit during the term of the rental. In the event any occupants are under [twenty-

one] years of age those occupants shall be the immediate family member or under legal guardianship of the primary occupant or another occupant that is [twenty-one] years of age or older. Both the primary occupant executing the rental agreement and the hotel or motel owner shall be responsible for compliance with this provision, and both shall be responsible for a violation.

By its terms, the Ordinance subjects violators to a possible $1,000 fine, a term of incarceration, community service, or any combination of the three.

In enacting the Ordinance, the Borough council made the following findings: "for many decades during the months of April, May and June the Borough has experienced substantial numbers of unsupervised minors who rent rooms in the Borough to celebrate high school proms and graduations;" the number of unsupervised minors has "grown because of curfews and other restrictions imposed by neighboring municipalities;" the crowds of minors were

A-2683-23

responsible for "unlawful and unsafe conditions;" the minors engaged in "violent and disorderly behavior [causing] excessive and unnecessary noise, parking complaints, vandalism, destruction of public and private property, fights . . . underage drinking and public intoxication, underage possession and use of cannabis, and public urination;" the Borough was devoting "substantial manpower and financial resources" to address the problem and "public safety employees and volunteers [were] put in harm's way;" and an earlier ordinance adopted in 2018 set a minimum age of eighteen to rent any premises but this had not mitigated the problems.

On January 23, 2024, plaintiff, 1 the operator of a motel in the Borough, brought this action seeking damages and an injunction preventing enforcement of the Ordinance. Plaintiff also requested temporary restraints. In its complaint, plaintiff claimed that the Ordinance violates the New Jersey Civil Rights Act (CRA), N.J.S.A. 10:6-1 to -2, by depriving their guests of equal protection and substantive due process under both the federal and New Jersey Constitutions;

1 Two parties initially brought this case: Sun Property Management and Herb McGrath Family Partnership, Inc., doing business as Hershey Motel (Hershey). However, on April 11, 2024, the parties stipulated to dismissal with prejudice with respect to Hershey.

A-2683-23

and the LAD, by discriminating against their guests on the basis of age and race. 2 Plaintiff also argued that the Ordinance is impermissibly vague, as it fails to make clear what a hotel or motel must do to comply with its requirements. 3 On March 5, the Borough moved to dismiss the case for failure to state a claim under Rule 4:6-2(e). On March 8, the court heard oral argument on plaintiff's request for temporary restraints, which it denied.

On April 12, after a second oral argument, the court dismissed the complaint, rendering an oral decision. As an initial matter, the court found that plaintiff had no standing under the LAD or the CRA because a motel owner

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