STATE, DEPARTMENT OF LAW AND PUBLIC SAFETY V. GONZALEZ
Case Date: 12/05/1995
Docket No: SYLLABUS
|
(This syllabus is not part of the opinion of the Court. It has been prepared by the Office of the Clerk for
the convenience of the reader. It has been neither reviewed nor approved by the Supreme Court. Please
note that, in the interests of brevity, portions of any opinion may not have been summarized).
Argued September 12, 1995 -- Decided December 5, 1995
COLEMAN, J., writing for a unanimous Court.
The issue on appeal is whether in an employee license revocation hearing, the Casino Control
Commission (Commission) should be permitted to relitigate the facts underlying the employee's prior
criminal convictions.
There is a two-tiered regulatory system in the New Jersey casino industry. The Commission is the
quasi-judicial licensing body and the Division of Gaming Enforcement (Division) is the investigatory and
prosecutorial body. The Commission issued Adriel Gonzalez a casino-employee license pursuant to the
Casino Control Act (Act). That license permitted him to be employed by the Sands Hotel and Casino as a
security officer. While holding that license, Gonzalez, on October 22, 1990, Gonzalez entered pleas of guilty
to conspiracy to distribute marijuana and possession of marijuana with intent to distribute within 1,000 feet
of a school in Hammonton Township. Gonzalez was sentenced on November 30, 1990 to a term of
probation and, as a condition of probation, he was required to serve thirty days in the Atlantic County Jail.
Based on the judgment of conviction, the Division filed a complaint with the Commission on
September 17, 1991, seeking revocation of Gonzalez's casino-employee license. A hearing was conducted in
April 1992 before one of the Commissioners sitting as a hearing examiner. At the hearing, Gonzalez
testified under oath that, despite his entry of the guilty pleas, he did not commit the offenses charged.
In June 1992, the hearing examiner issued an initial decision revoking Gonzalez's license. The full
Commission remanded the case to the hearing examiner for further proceedings. During that second
hearing, conducted in September 1992, Gonzalez again was permitted to testify, over the Division's
objections, that he was not guilty of the offenses. The examiner concluded that: Gonzalez's denial was
credible; he had been rehabilitated pursuant to section 90(h) of the Act (section 90h); and he possessed the
"good character, honesty and integrity" required under the Act to retain his casino-employee license. The
Commission, Chairman Perskie dissenting, adopted the hearing officer's determination.
The Appellate Division reversed the decision of the Commission based on the doctrines of issue
preclusion and judicial estoppel. One member of the panel dissented, stating that because issue preclusion is
an equitable doctrine, the Commission should have discretion in determining whether to give preclusive
effect to a prior judicial determination absent a contrary legislative intent. The Commission moved for leave
to appeal as of right based on the dissent in the Appellate Division.
HELD: Because of the strong public policy of maintaining integrity in the casino industry, a casino employee
who is the subject of a casino-employee license revocation proceeding, may not present evidence
contradicting his or her criminal convictions. The casino employee may present evidence to support
a claim of rehabilitation, but that evidence must not be inconsistent with the elements of the
criminal offenses to which guilty pleas have been entered.
1. A valid casino employee license may be revoked if the employee is convicted of a disqualifying offense
and has not been rehabilitated, pursuant to section 90h. The Legislature did not articulate the types of
evidence that are relevant to rehabilitation under section 90h. Thus, the Court's review of the Commission's
decision is restricted to whether it's action violates the Act's express or implied legislative policies. (pp. 6-9)
2. The cornerstone of the legislative plan to regulate casino gambling in Atlantic City, and the very heart of
the public policy embraced by the Act, is "the public confidence and trust in the credibility and integrity of
the regulatory process by the State and casino operations. The regulatory process is designed to extend strict
State regulation to all persons, locations, practices and associations related to the operation of licensing
casino enterprises. The most effective way of maintaining the integrity of the casino industry in Atlantic City
is to prevent criminals from participating in the industry, including casino operators and employees. The
Commission does have legislatively defined discretion in implementing the Act; however, this discretion may
not be exercised in a way that violates the Act's public policy. (pp. 9-10)
3. The Commission's procedure in this case undermines the Act's underlying policy: to maintain integrity
within the casino industry. The doctrine of issue preclusion does not prevent the pleading party in the trial
of a tort or contract case from contesting the admitted facts, including a guilty plea. However, to apply the
same rationale to a casino employee revocation proceeding and permit repudiation of the facts underlying
criminal convictions based on guilty pleas would be inimical to the policies that underlie the Act. (pp. 10-11)
4. Gonzalez entered his guilty pleas under oath; there was a sufficient factual basis for the pleas, the pleas
were made voluntarily; and Gonzales understood the nature of the charges and the consequences of his
pleas. Moreover, he never sought to vacate his guilty pleas. Because a guilty plea leading to a conviction has
the force of an admission of guilt on the charge based on a defendant's sworn factual statement, the Act,
when considered as a whole, does not permit a casino-licensee to repudiate his or her guilty plea in an
attempt to establish rehabilitation. The Legislature did not intend that judgments of conviction be treated
differently depending on whether they resulted from guilty pleas or trials. (pp. 11-12)
5. The Commission's decision to allow repudiation of guilty pleas in an effort to establish rehabilitation will
reasonably lead to a loss of public confidence in casino gambling and the judiciary. Under the Act, a casino
employee convicted of a disqualifying offense based on a guilty plea has a right to testify in a revocation
hearing to support a claim of rehabilitation, pursuant to section 90(h). However, the employee's right to
testify does not extend to testifying falsely or repudiating the underlying criminal charges. (pp. 12-13)
6. In an attorney disciplinary proceeding, like a casino employee license revocation hearing, the underlying
purpose is to protect the public. Moreover, a criminal conviction is conclusive proof of guilt. The underlying
facts of the conviction may be examined in respect of mitigation of penalty, but the facts of guilt will not be
retried. In view of the common goals shared by casino employee revocation proceedings and attorney
disciplinary proceedings, the effect of a guilty plea should be the same for both. (p. 14)
7. The doctrine of judicial estoppel bars a party to a legal proceeding from arguing a position inconsistent
with one previously asserted. Here, judicial estoppel protects the integrity of both the judicial process and
the casino industry when the Commission acts in a quasi-judicial capacity. (pp. 14-15)
8. It was the Legislature's purpose to prevent criminals from the casino industry. Therefore, there is no
reason why the Legislature would intend to permit relitigation of the elements of a criminal conviction for
any purpose under the Act. Thus, a judgment of conviction may not be collaterally attacked at an employee-license revocation proceeding. The Legislature intended to give preclusive effect to judgments of conviction
to achieve the Act's underlying intent. No distinction under the Act is to be made between convictions based
on guilty pleas and those based on litigated verdicts. Convictions that have not been vacated by a court of
competent jurisdiction stand as conclusive evidence of guilt for all purposes under the Act. However, facts
that relate to the surrounding circumstances of the offense may be presented in an employee license
revocation proceeding to support a claim of rehabilitation, so long as that evidence is not inconsistent with
the elements of the disqualifying events. (pp. 15-17)
Judgment of the Appellate Division is AFFIRMED.
CHIEF JUSTICE WILENTZ and JUSTICES HANDLER, POLLOCK, O'HERN, GARIBALDI and
STEIN join in JUSTICE COLEMAN's opinion.
STATE OF NEW JERSEY, DEPARTMENT
Complainant-Respondent,
v.
ADRIEL GONZALEZ,
Respondent.
Argued September 12, 1995 -- Decided December 5, 1995
On appeal from the Superior Court, Appellate
Division, whose opinions are reported at
Steven M. Ingis, Assistant General Counsel,
argued the cause for appellant New Jersey
Casino Control Commission (John R. Zimmerman,
General Counsel, attorney).
Gary A. Ehrlich, Deputy Attorney General,
argued the cause for respondent State of New
Jersey, Department of Law & Public Safety,
Division of Gaming Enforcement (Deborah T.
Poritz, Attorney General of New Jersey,
attorney; Frank Catania, Assistant Attorney
General, of counsel).
The opinion of the Court was delivered by
COLEMAN, J.
The question raised in this case is whether the Casino Control Commission (Commission), while exercising its regulatory responsibilities in determining whether to revoke the license of a casino employee based on his guilty pleas to two third-degree
criminal offenses, should be permitted to relitigate the facts
underlying the criminal convictions.
The casino industry in New Jersey is subject to a two-tiered
regulatory system. The Commission is the quasi-judicial
licensing body. N.J.S.A. 5:12-63. The Division is the
investigatory and prosecutorial body. N.J.S.A. 5:12-76.
and Casino as a security officer. N.J.S.A. 5:12-90(f). While
holding that license, Gonzalez was indicted on September 5, 1990,
for possession of and conspiracy to distribute marijuana,
possession with intent to distribute and distribution of
marijuana to an undercover agent in a school zone, all occurring
on March 14, 1990, in violation of the Comprehensive Drug Reform
Act of 1987, N.J.S.A. 2C:35-5 and -7 and N.J.S.A. 2C:5-2. On
October 22, 1990, Gonzalez entered pleas of guilty to conspiracy
to distribute marijuana contrary to N.J.S.A. 2C:5-2 and N.J.S.A.
2C:35-5b(3), and possession of marijuana with intent to
distribute within 1,000 feet of a school in Hammonton Township, a
violation of N.J.S.A. 2C:35-7. He was sentenced on November 30,
1990, to a term of probation, and as a condition of probation, he
was required to serve thirty days in the Atlantic County Jail.
commit the offenses charged." State v. Gonzalez, supra, 273 N.J.
Super. at 241.
[Id. at 242.]
The Appellate Division reversed based on the doctrines of
issue preclusion and judicial estoppel. Id. at 247-49. One
member of the panel dissented, stating that because issue
preclusion is an equitable doctrine, the Commission should have
discretion in determining whether to give preclusive effect to a
prior judicial determination absent a contrary legislative
intent. Id. at 252.
The Commission argues that it is vested with the discretion
in an administrative, license revocation hearing not to apply the
doctrines of issue preclusion and judicial estoppel to preclude
evidence contradicting a guilty plea.
When determining whether a convicted casino employee has
been rehabilitated, the Commission must consider the following
criteria:
(2) The nature and seriousness of the offense or
conduct;
(3) The circumstances under which the offense or
conduct occurred;
(4) The date of the offense or conduct;
(5) The age of the applicant when the offense or
conduct was committed;
(6) Whether the offense or conduct was an
isolated or repeated incident;
(7) Any social conditions which may have
contributed to the offense or conduct;
(8) Any evidence of rehabilitation, including
good conduct in prison or in the community,
counseling or psychiatric treatment received,
acquisition of additional academic or
vocational schooling, successful
participation in correctional work-release
programs, or the recommendation of persons
who have or have had the applicant under
their supervision.
[N.J.S.A. 5:12-90h.]
The Legislature did not articulate the types of evidence that are relevant to "rehabilitation" when it added paragraph h to subsection 90 in 1980. See L. 1979, c. 282, § 25. Nor did it address that issue in 1988 when it amended that subsection. The Commission argues that, "[a]lthough the Legislature accorded
preclusive effect in section 86c to a prior conviction in terms
of finding that a disqualifying offense was committed, the Act
does not similarly preclude a party seeking to demonstrate
rehabilitation pursuant to subsection 90h from presenting
evidence that negates one of the elements of the disqualifying
offense to which he has pled guilty."
This appeal requires us to focus on the way in which the
Commission exercised its adjudicatory responsibilities in
determining whether Gonzalez had been rehabilitated. The
judicial capacity to review that administrative action is
limited. Gloucester County Welfare Bd. v. New Jersey Civil Serv.
Comm'n,
93 N.J. 384, 390 (1983). As this Court has observed:
[Public Serv. Elec. & Gas Co. v. New Jersey
Dep't of Envtl. Prot.,
101 N.J. 95, 103
(1985).]
Here, our review of the Commission's decision is restricted to
whether its action violates the Act's express or implied
legislative policies.
of maintaining the integrity of the casino industry in Atlantic
City is "the exclusion from participation therein of persons with
known criminal records, habits or associations." N.J.S.A. 5:12-1b(7). That policy applies with equal force to casino operators
and employees alike. So strong is the legislative expression of
public policy that a license issued under the Act is "deemed a
revocable privilege conditioned upon the proper and continued
qualification of the individual licensee." N.J.S.A. 5:12-1b(8).
Notwithstanding this tight regulatory scheme, we
recognize that the Commission has legislatively defined
discretion in implementing the Act. See In re Solid Waste Util.
Cust. Lists,
106 N.J. 508, 519-20 (1987). This discretion,
however, may not be exercised in a way that violates the Act's
public policy. In exercising its discretion, "the Commission
must be ever mindful that the gaming industry is to be insulated
from criminals so that its integrity may be maintained." New
Jersey Dep't of Law and Pub. Safety v. Hannah,
221 N.J. Super. 98, 102 (App. Div. 1987). The procedure that the Commission
utilized below undermines the Act's underlying policy: to
maintain integrity within the casino industry.
permit repudiation of the facts underlying criminal convictions
based on guilty pleas would be inimical to the policies that
underlie the Act.
For still another reason, the policy of maintaining the
integrity of the casino industry would be ill-served by
permitting Gonzalez to repudiate his guilty pleas. He entered
his guilty pleas under oath pursuant to Rule 3:9-2. Under that
rule, the judge was required to reject any plea unless the judge
was satisfied that Gonzalez gave a "factual basis for the plea
and that the plea [was] made voluntarily, [and] not as the result
of any threats or of any promises or inducements not disclosed on
the record, and with an understanding of the nature of the charge
and the consequences of the plea." R. 3:9-2. There is not as
much as a hint that Gonzalez's guilty pleas failed to conform to
the requirements of Rule 3:9-2. Nor is there any suggestion that
Gonzalez ever sought to vacate his guilty pleas. Because a
guilty plea leading to a judgment of conviction has the force of
an admission of guilt on the charge based on a defendant's sworn
factual statement, we are persuaded that the Act, when considered
as a whole, does not permit a casino licensee to repudiate his or
her guilty plea in an attempt to establish rehabilitation
pursuant to N.J.S.A. 5:12-90h.
on whether they resulted from guilty pleas or trials. A
hypothetical example can best illustrate the point. A.B. and
C.D. are both indicted for possession of a controlled dangerous
substance with intent to distribute in a school zone. A.B.
pleads guilty, but C.D. elects to be tried, and at his trial,
testifies that he did not commit the offense. The jury
nonetheless finds C.D. guilty. Even though both defendants are
convicted of the same offense, the Commission would treat the
convictions differently in a license revocation proceeding.
A.B., who admitted his guilt in the plea, would be allowed to
deny his guilt before the Commission. C.D., who has maintained
his innocence throughout, however, would not be allowed to
continue to assert his innocence before the Commission. Thus,
the Commission punishes the casino employee who elects to stand
trial on a disqualifying offense.
to testifying falsely. The legislative recognition that some
convicted criminals may be rehabilitated cannot be perverted into
a license to use perjurious testimony in an attempt to
demonstrate rehabilitation. Given the proper policies involved
and the clear legislative intent to bar criminals from the casino
industry, a hearing before the Commission is the last place in
this State where those duly convicted should be allowed to claim
they are innocent.
A comparison to an attorney disciplinary proceeding is
useful because, like a casino employee license revocation
hearing, its underlying purpose is to protect the public. In
attorney disciplinary proceedings, a criminal conviction is
conclusive proof of guilt. R. 1:20-13(c)(1); In re Connor,
124 N.J. 18, 21 (1991) (involving a guilty plea to driving while
intoxicated); In re Mirabelli,
79 N.J. 597, 602 (1979) (involving
a guilty plea to bribery). Although the underlying facts of the
conviction may be examined with respect to mitigation of penalty,
"the fact of guilt will not be retried." In re Rosen,
88 N.J. 1,
3 (1981). In view of the common goals shared by casino employee
revocation proceedings and attorney disciplinary proceedings, we
conclude that the effect of a guilty plea should be the same for
both.
"bar[s] a party to a legal proceeding from arguing a position
inconsistent with one previously asserted." N.M. v. J.G.,
255 N.J. Super. 423, 429 (App. Div. 1992) (citations omitted); Levin
v. Robinson, Wayne & La Sala,
246 N.J. Super. 167, 178-79 (Law
Div. 1990). When Gonzalez entered his guilty pleas, he swore
that he conspired to possess and distribute marijuana and that he
possessed marijuana with the intent to distribute it within a
school zone. His subsequent attempt to change his testimony at
the license revocation hearing indicates that he was playing fast
and loose with the courts and the casino regulators. The Act
does not tolerate such conduct. He benefitted from his guilty
pleas by receiving a lenient sentence. After completing the
probationary sentence, he then denied his guilt in the license
revocation proceeding in an attempt to show not only that he was
rehabilitated, but that he had not committed a disqualifying
offense. Thus, Gonzalez "had his cake and he ate it too."
Duplan Corp. v. Deering Milliken, Inc.,
397 F. Supp. 1146, 1177
(D.S.C. 1974). Judicial estoppel protects the integrity of both
the judicial process and the casino industry when the Commission
acts in its quasi-judicial capacity.
We find equally unconvincing the Commission's contention that because the Legislature, in the Act's anti-racketeering provision, expressly precluded relitigation of "the essential allegations of the criminal offense," N.J.S.A. 5:12-127(d), it
did not intend to preclude relitigation of the facts underlying
judgments of conviction based on guilty pleas when deciding
whether the applicant was rehabilitated under N.J.S.A. 5:12-90h.
Such a reading is not in keeping with the spirit of the Act. The
Act must be read sensibly in view of its overall legislative
scheme. It was the Legislature's purpose to prevent criminals
from gaining a foothold in the casino industry. Moreover, it is
the internal sense of the Act that controls. Loboda v. Township
of Clark,
40 N.J. 424, 435 (1963). Isolated expressions may not
be invoked to defeat a reasonable construction of the Act. Giles
v. Gassert,
23 N.J 22, 33-34 (1956).
convictions based on pleas of guilty and those based on litigated
verdicts. Irrespective of the motives that may have impelled
Gonzalez to enter the guilty pleas, convictions based thereon
that have not been vacated by a court of competent jurisdiction
stand as conclusive evidence of guilt for all purposes under the
Act. Facts that relate to the surrounding circumstances of the
offense may be presented, however, in an employee license
revocation proceeding to support a claim of rehabilitation, so
long as that evidence is not inconsistent with the elements of
the disqualifying offense. CHIEF JUSTICE WILENTZ and JUSTICES HANDLER, POLLOCK, O'HERN, GARIBALDI and STEIN join in JUSTICE COLEMAN's opinion.
NO. A-5 SEPTEMBER TERM 1995
STATE OF NEW JERSEY, DEPARTMENT
Complainant-Respondent,
v.
ADRIEL GONZALEZ,
Respondent.
DECIDED December 5, 1995
Footnote: 1In 1990, possession of marijuana with intent to distribute in a school zone was not an offense enumerated in the Act that would mandatorily disqualify Gonzalez from holding a casino employee license. See N.J.S.A. 5:12-86c(1). It was added as such an offense by L. 1991, c. 182, § 27, effective June 29, 1991. No claim has been made with regard to whether the school zone conviction can retroactively become a disqualifying offense.
|