Background
In May 2024, the Winslow Township Council adopted Ordinance O-2024-010, a rent-control measure establishing a 2.5% annual cap on rent increases for mobile home park operators within the Township. Plaintiff N&SV MHC, LLC, which operates The Norway’s Mobile Home Court Inc. and Strawberry Village, Inc., challenged the ordinance through a prerogative writ action in the Law Division, Camden County. Plaintiff contended that the ordinance was arbitrary and capricious and violated its due process rights under the Fifth and Fourteenth Amendments to the United States Constitution, enforceable through 42 U.S.C. section 1983.
The Township defended the ordinance by pointing to resident complaints about rent increases and the ordinance’s preamble, which stated that the measure was intended to be consistent with recently proposed state legislation addressing rent controls for mobile home parks. The trial court — Judge Deborah Silverman Katz — conducted a thorough review and, in a July 7, 2025 written decision, held that the ordinance was arbitrary and capricious as both written and applied and therefore unconstitutional. The judge further found that plaintiff was entitled to an award of attorney fees under 42 U.S.C. section 1988(b) as the prevailing party on a federal constitutional claim. Winslow Township appealed.
The Court’s Holding
The Appellate Division affirmed substantially for the reasons set forth in Judge Silverman Katz’s comprehensive decision. The court briefly addressed two arguments the Township raised on appeal. First, defendants contended the trial court had improperly found no record support for the 2.5% annual cap, arguing that resident complaints and the preamble’s reference to state legislation provided adequate justification. The Appellate Division rejected this argument, explaining that the trial court’s concern was broader: the factual findings set forth in the ordinance’s Purpose section — the very findings that were supposed to justify its adoption — were not supported by anything in the record before the Council when it acted.
Second, the court addressed the Township’s contention that the ordinance was validated by the state legislature’s subsequent enactment of N.J.S.A. 52:27D-287.12 to -287.14 in 2025, which addressed rent control for mobile home parks. The Appellate Division rejected this argument as well, finding that the ordinance was not in fact consistent with the new statute. To the contrary, the Legislature had incorporated detailed procedural safeguards into the statute — including a mechanism by which a landlord may petition the Commissioner of Community Affairs for approval to increase rents above the cap — that the ordinance entirely lacked. Rather than validating the ordinance, the court concluded, the subsequently enacted statute actually highlighted the ordinance’s constitutional deficiencies by demonstrating that meaningful procedural protections were both feasible and expected.
Key Takeaways
- A municipal rent-control ordinance must be supported by factual findings grounded in the actual record before the governing body when it acts; citing resident complaints in a preamble or invoking consistency with proposed state legislation is insufficient when those foundational facts are not substantiated in the legislative record.
- A subsequently enacted state statute does not automatically validate a pre-existing municipal ordinance addressing the same subject matter — particularly where the statute contains procedural safeguards, such as a rent-increase petition mechanism, that the ordinance omits; the gaps can instead highlight the ordinance’s constitutional defects.
- Mobile home park operators and other landlords subject to municipal rent-control ordinances may pursue federal due process claims under 42 U.S.C. section 1983 and, if they prevail, recover attorney fees from the municipality under section 1988(b), making the litigation calculus meaningfully different from a purely state law challenge.
Why It Matters
This decision arrives at a moment of heightened legislative activity around housing costs and rent stabilization in New Jersey. The Legislature’s 2025 enactment of a statewide mobile home park rent-control framework, N.J.S.A. 52:27D-287.12 et seq., reflects a policy choice to address affordability concerns — but this case illustrates that municipalities cannot get ahead of that framework by passing ordinances without an adequate factual record and without the procedural protections the Legislature subsequently deemed constitutionally necessary.
For real estate and municipal law practitioners, the decision is a useful reminder that prerogative writ challenges to local ordinances on due process grounds can succeed where the governing body failed to build an adequate factual record to support its regulatory choices. The availability of fee-shifting under section 1988(b) adds an additional strategic consideration for property owners weighing whether to challenge a rent-control measure in court. Municipalities enacting or amending rent-control ordinances — whether directed at mobile home parks, apartment buildings, or other residential properties — should ensure their legislative record contains specific, verifiable findings tied to identifiable conditions warranting the regulatory intervention.