## Facts

- The Borough of Fair Lawn solicited bids for a municipal refuse-collection contract, requiring prospective bidders to submit a sworn qualification questionnaire on experience, equipment, and finances.
- Bids were received after a one-time postponement of the bid-opening date without readvertisement, and the Borough awarded the contract to Frank and Gerald Capasso as the lowest qualifying bidders.
- Band’s Refuse Removal, Inc., a private hauler, separately serviced a commercial customer in the Borough under a private contract.
- The Borough adopted Ordinance No. 688, requiring a municipal permit for refuse collection and limiting permits to those holding a municipal contract, effectively excluding Band’s.
- Band’s applied for a permit and was denied; it sued seeking declaratory relief and issuance/renewal of a permit, alleging the ordinance was unlawful.
- The Capassos intervened, defended the ordinance and contract, and counterclaimed to prevent the Borough from permitting Band’s and to bar Band’s from collecting during the contract term.
- After a grand jury investigation produced allegations of irregularities and indictments of municipal officials, Band’s amended its complaint to allege the Capasso contract resulted from fraud and noncompetitive “secret agreements.”
- In the Law Division, the trial judge took an active role: appointed an amicus, issued subpoenas, called and examined numerous witnesses, offered exhibits, and then ruled on admissibility; the judge signaled that dropping the fraud issue would lead to invalidation of Band’s private contract.
- The Law Division declared the Capasso contract and Ordinance No. 688 void ab initio, declared payments under the contract illegal, and entered a money judgment for the Borough against the Capassos for $303,052.62.
- The Capassos appealed, arguing they were denied a fair trial because the judge lost neutrality and functioned as an investigator and advocate.

## Issues

1. Whether the trial judge’s conduct—initiating and directing extensive fact-gathering and pursuing a corruption inquiry—deprived the Capassos of due process by denying an impartial adjudication.
2. Whether a judge may use private civil litigation as a vehicle for a broad public investigation by calling witnesses and introducing evidence beyond the parties’ presentation.
3. Whether Band’s had standing to challenge the municipal bidding process that produced the Capasso contract.

## Decision

- The Appellate Division reversed the Law Division judgment against the Capassos.
- The court held that the manner in which the trial was conducted denied due process because the judge abandoned the required role of a neutral decision-maker.
- The court set aside the sweeping relief entered against the Capassos, including the declaration that the contract and payments were void ab initio and the $303,052.62 judgment.
- The court indicated that any adjudication of fraud, contract invalidity, or restitution must occur through procedurally regular proceedings before an impartial tribunal.
- The court also addressed limits on Band’s position, including that Band’s could not mount a broad attack on the bidding process as a non-bidder.
- Certification was denied by the state supreme court.

## Legal Principles

- Due process requires not only correct outcomes but an impartial tribunal and fair procedure; a judge must maintain neutrality in appearance and reality.
- A trial judge may manage proceedings and ask questions, but may not assume an investigative or prosecutorial role that effectively aligns the court with one side or an external enforcement agenda.
- Structural unfairness in the conduct of a trial can require reversal irrespective of the perceived merits of the underlying allegations.
- Standing limits challenges to public contracting procedures; a non-bidder generally may not litigate the legality of the bidding process as if a disappointed bidder or taxpayer.
- A municipal regulatory measure affecting refuse collection may be valid in concept, but its application cannot be enforced through proceedings that deny litigants a fair hearing.

## Conclusion

The appellate court reversed because the trial judge’s extraordinary involvement in investigating and proving corruption transformed the case from an adversary proceeding into a judge-driven inquiry, denying the Capassos due process and requiring that any further determinations be made in a properly conducted trial before a neutral adjudicator.


Band’s Refuse Removal, Inc. v. Borough of Fair Lawn, 62 N.J. Super. 522, 163 A.2d 465 (App. Div. 1960)