June 13, 2012
New Jersey Supreme Court Holds Free Speech Within Units Trumps Association Sign Prohibition – Mazdabrook Commons Homeowner’s Association v. Khan
Written By: Ronald L. Perl and Jonathan H. Katz
In Mazdabrook Commons Homeowner’s Association, Inc. v. Khan, the New Jersey Supreme Court considered the question of whether a homeowners’ association may prohibit residents from posting political signs in the windows of their own homes. The Court determined that such a restriction was unconstitutional, even when contained in the association’s governing document, holding that “[b]alancing the minimal interference with Mazdabrook’s private property interest against Khan’s free speech right to post political signs on his own property, we conclude that the sign policy in question violates the free speech clause of the State Constitution.”
The facts of the case are as follows: Mazdabrook Commons Homeowner’s Association is responsible for the management, operation and administration of Mazdabrook Commons, a common-interest community of 194 townhomes in Parsippany-Troy Hills, New Jersey. The Association is governed by a Declaration of Covenants and Restrictions, By-Laws and certain Rules and Regulations. The Declaration specifically precludes signs “in or upon any Building, the Common Facilities or any part thereof without the prior written consent of the [Association’s] Board.” The Association’s Rules and Regulations similarly banned all signs, and it was the board’s practice to only allow one “For Sale” sign to be placed in a window of each unit, consistent with the restriction contained in the original developer’s Public Offering Statement.
In 2003, Wasim Khan purchased a home in Mazdabrook. In 2005, Khan ran for local political office and posted two signs in support of his candidacy – one inside his front window and the other inside his front door window – so that they would be visible through the glass. Citing to the sign prohibition, the board requested that Khan remove the signs, and he complied. As a result of a later, unrelated lawsuit between Khan and the Association, Khan filed a counterclaim revisiting the forced removal of the signs and claiming violations of his free speech rights.
Applying the Schmid Test
The trial court found that the sign prohibition did not violate Khan’s free speech rights, relying on Committee for a Better Twin Rivers v. Twin Rivers Homeowners’ Ass’n, 192 N.J. 344 (2007), and applying the three-factor test outlined in State v. Schmid, 84 N.J. 535 (1980). A divided Appellate Division panel reversed the trial court’s decision, with the majority of the panel determining that the sign restriction was unconstitutional under Schmid. The Association appealed to the New Jersey Supreme Court, where Hill Wallack LLP represented the New Jersey Chapter of the Community Associations Institute as amcus curiae (“friend of the court”).
In affirming the Appellate Division’s decision that the restriction violated the New Jersey Constitution, the Supreme Court undertook a detailed analysis of the case law concerning free speech on private property. New Jersey is unique in that an individual’s affirmative right to speak freely is protected not only from abridgement by government, but also, in certain situations, from unreasonably restrictive and oppressive conduct by private entities. In Schmid, which involved a non-student’s right to distribute political materials on a private university’s campus, the Court outlined a three-factor test to determine the parameters of free speech rights on privately owned property. Those factors are: (1) the nature, purposes, and primary use of such private property; (2) the extent and nature of the public’s invitation to use that property; and (3) the purpose of the expressional activity undertaken upon such property in relation to both the private and public use of the property. In N.J. Coalition Against War in the Middle East v. J.M.B. Realty Corp., 138 N.J. 326 (1994), the Court applied Schmid as well as a general balancing of expressional rights and private property rights in determining that a regional shopping center must permit leafleting on political and societal issues subject to reasonable time, place, and manner restrictions.
More recently, the Court in Twin Rivers upheld the constitutionality of an association’s policy that limited common-interest community residents to posting one sign in any window of their home and a second sign in a flower bed near the residence. Utilizing the Schmid test, the Court in Twin Rivers found that the relatively “minor” sign restrictions imposed by the association were allowable because they only limited the number and placement of signs and did not totally prohibit expressional activity.
Why Mazdabrook Was Different
In deciding Mazdabrook, the Court modified the Schmid test in cases where the speech in question is that of a private organization’s member rather than an outsider. In doing so, the Court gave significant weight to the third Schmid factor and also elevated the importance of the Coalition general balancing test. Utilizing the modified Schmid and Coalition standards, the Court held that a “near complete ban on residential signs, which bars all political signs, cannot be considered a minor restriction as to Khan” because “it hampers the most basic right to speak about the political process and his own candidacy for office.”
In addition, unlike Twin Rivers, Mazdabrook did not adopt reasonable time, place, and manner restrictions, and adequate alternative means of political communication were not readily available to Khan. The Court also was critical of the fact that although signs could be allowed with the written consent of the board, there were no written standards to guide the board’s exercise of its discretion. On balance, the Court determined that the importance of Khan’s right to promote his candidacy for office, due to the relatively minor interference his conduct posed to private property, outweighed the Association’s interests.
What This Means
The overall impact of the Court’s decision is this – associations cannot absolutely ban a unit owner’s right to post a political sign on his or her own property even if that property is subject to community rules and regulations. However, as was the case in Twin Rivers, the Court reaffirmed an association’s right to enact reasonable time, place and manner restrictions on signs, such as limiting the number or location. Moreover, written criteria for signs must exist prior to enforcement.
The Mazdabrook decision pertains to the posting of political signs within a homeowner’s own unit and was based upon the owner’s right to free speech within his or her own unit and the minimal impact such signs have on the common interest community. The Court did not address other methods of expression, particularly where such methods may have a greater impact on commonly owned facilities or the rights of other association residents. There may be future cases that test the limits of Mazdabrook, to try to extend its reach to other modes of speech. The holding may also be applied to other types of organizations.
On the other hand, by confirming that the association may impose reasonable time, place and manner restrictions and retaining the Schmid and Coalition principles, the Court made clear that unit owners do not have a completely unfettered right to speech that is displayed outside their homes. Thus, association governing boards will still have to balance the rights of individual owners against the rights of other members to develop reasonable rules. To properly decipher and apply these complex and fact sensitive issues, we recommend that management and board members consult with the association’s counsel to determine whether current rules and restrictions or proposed regulations pass constitutional muster.
To read the full Supreme Court opinion, click here.
This article provides information of general interest and is not intended, and should not be used, as a substitute for consultation with legal counsel. Any questions regarding the specific issues raised in this article should be directed to the authors or to your contacts at Hill Wallack LLP.