N.J. Department of Environmental Protection v. Huber, A-116 September Term 2010; Supreme Court; opinion by LaVecchia, J.; decided April 4, 2013. On certification to the Appellate Division. [Sat below: Judges Graves, Harris and Newman in the Appellate Division.] DDS No. 17-1-xxxx [56 pp.]

In this appeal, the court considers whether, consistent with the Fourth Amendment of the U.S. Constitution and Article I, Paragraph 7 of the N.J. Constitution, the N.J. Department of Environmental Protection (DEP) may conduct an administrative search of permit-restricted residential property under the Freshwater Wetlands Protection Act (FWPA), without a warrant; and whether there was sufficient evidence to sustain the finding that the FWPA was violated.

The N.J. Legislature passed the FWPA as a means of protecting and regulating New Jersey’s sensitive freshwater wetlands. The FWPA established a permitting process to which a property owner must submit before engaging in an activity that risks disturbing freshwater wetlands or protected transition areas near wetlands. The FWPA also confers on the DEP a statutory right to enter property for the purpose of conducting inspections, sampling of soil or water, and for otherwise determining compliance with the provisions of the act. The regulatory scheme contains a series of steps through which the DEP may secure compliance with its inspection and monitoring of freshwater wetlands.

Here, a civil penalty and restoration remedy was imposed on petitioners, Robert and Michelle Huber, as a result of FWPA violations committed on their land, which had been developed subject to FWPA permit conditions. An administrative hearing substantiated the violations and resulted in the minimum fine and a restoration remedy for the affected property.

On appeal, the Hubers raised for the first time a constitutional argument contesting the right of a DEP inspector to have entered their land without securing an administrative search warrant in advance. They argued that the inspector’s testimony, based on observations made during that inspection, should not have been included in the record and thus the violations had not been substantiated.

The Appellate Division rejected the Hubers’ constitutional challenge, in addition to all other arguments raised, and affirmed the administrative penalty. The Appellate Division concluded that the testimony, photographs and official records amply supported the findings that the Hubers violated the FWPA. The panel found that consent was not essential, the DEP inspector had statutory authority to enter and inspect, and an administrative warrant was not required based on an exception to the warrant requirement set forth in New York v. Burger.

The court granted the Hubers’ petition for certification.

Held: Land subject to FWPA restrictions is subject to the statutory, reasonable right of entry and inspection. Here, even excluding the DEP inspector’s testimony about his inspection, there was sufficient evidence to sustain the finding of a violation of the FWPA.

Addressing the issue of administrative searches of permit-restricted residential property under the FWPA, the court adopts a different view than that of the Appellate Division as to how the FWPA inspection scheme operates, and operates consistently within the Fourth Amendment to the U.S. Constitution and Article I, Paragraph 7 of the N.J. Constitution, and affirms the judgment imposing an administrative penalty and a restoration remedy for disturbed freshwater wetlands on the Hubers’ property.

In New York v. Burger, the Supreme Court authorized a limited exception to the warrant requirement for administrative searches of commercial property used in closely regulated businesses, where the privacy interests of the owner are weakened and the government interests in regulating the businesses are heightened. The court finds that the exception does not extend to the heightened privacy interests associated with private, residential property — Burger‘s exception does not apply to inspection of residential property under the FWPA.

The Supreme Court has acknowledged that a judicial process to enforce a reasonable administrative inspection scheme can comply with Fourth Amendment protections, despite the lack of consent by the property owner, if the regulatory scheme advances important governmental interests, takes into account reasonable expectations of privacy, and avoids nonconsensual, forced entry accomplished outside of the warrant framework.

The regulatory scheme that implements the FWPA puts the permittee on notice that property subject to a FWPA permit is subject to, at reasonable times, a right of entry by a DEP representative for the purpose of an inspection. In exercising that right, the DEP must comply with its processes, which require presentation of credentials before seeking consent to enter, inspect, and sample at reasonable times. It also authorizes the DEP to assess a civil penalty for refusing a DEP representative’s lawful entry. If entry is denied, the commissioner may order that entry be provided and the DEP is entitled to judicial process to compel access to the property subject to the FWPA permit. The commissioner may also assess a separate violation for denying entry.

In the administrative-search context, probable cause to gain court-ordered entry to property may be based on a showing that reasonable legislative or administrative standards for an inspection are satisfied. The FWPA inspection scheme is reasonable as applied to owners of residential property subject to a FWPA permit because such owners must comply with the permit and the permitting scheme that authorizes reasonable entry onto the affected land. The permitting scheme ensures that an order is issued to gain peaceful entry to inspect at a reasonable time if consensual entry is denied. The owner of residential property subject to a FWPA permit cannot claim a full expectation of privacy to areas subject to the permit. The permittee’s rights are subject to the statutory scheme by which the permit operates, and that includes submitting to a reasonable inspection scheme.

Here, the record contains sufficient credible evidence, exclusive of the DEP inspector’s testimony that was challenged on appeal, to sustain the finding of violations of the FWPA.

The judgment of the Appellate Division is affirmed as modified.

Chief Justice Rabner; Justices Albin, Hoens and Patterson; and Judges Rodríguez and Cuff (both temporarily assigned) join in Justice LaVecchia‘s opinion.

For appellants — Howard P. Davis (Davis, Anne M. Ronan, Deborah J. Ritter, Joanne C. Kalas and Eric M. Grille on the briefs). For respondent — Gary W. Wolf II, Deputy Attorney General (Jeffrey S. Chiesa, Attorney General; Melissa H. Raksa, Assistant Attorney General, of counsel).