State Codes and Statutes
Statutes > New-jersey > Title-52 > Section-52-27 > 52-27-6252:27-62. Remedies; enforcement of judgments, etc.; bringing of actions or proceedings stayed; exceptions
Whenever the commission shall function in a municipality having a school district coterminous therewith which is governed by the provisions of chapter seven of the Title Education (s. 18:7-1 et seq.):
a. No judgment, levy or execution against such school district or the property thereof for the recovery of the amount due on any bonds, notes or other obligations of the school district, in the payment of which such school district has defaulted shall be enforced until otherwise specially directed by the Superior Court in an appropriate action or proceeding for such purpose, after notice to the commission; and the enforcement of any such judgment, levy or execution shall be and it hereby is stayed until otherwise specially directed as aforesaid;
b. No action or proceeding of any kind either direct or ancillary, by way of a proceeding in lieu of prerogative writ or otherwise, shall be brought against such school district, municipality, or any public officers for the assessment, levy or collection of taxes for such school district and any and all actions or proceedings therefor shall be and they hereby are stayed; except that first, the Superior Court, after notice to the commission may authorize one or more creditors of such school district to bring and maintain an action or proceeding therefor in the Superior Court, which shall be brought for the benefit of themselves and all other creditors of such school district and in which all other creditors of such school district shall have the right to intervene and assert their claim and in which all other creditors of such school district may, and such commission shall, be made parties in such manner and upon such notice as the court shall prescribe; and except that, second, the commission may bring and maintain an action or actions or a proceeding in lieu of prerogative writ or any other appropriate proceeding or proceedings for the assessment, levy or collection of taxes for such school district for the payment of principal or interest of the indebtedness of the school district found to be outstanding as provided in section 52:27-46 of this Title; without limiting its power otherwise to direct by a proceeding in lieu of prerogative writ the assessment, levy or collection of taxes, the Superior Court in the action or proceeding aforesaid may, to the extent which it shall deem just and equitable, afford to the holders collectively of any due and unpaid claims against a school district any remedy which might be afforded under any other law to any individual creditor in any such proceeding in lieu of prerogative writ for the assessment, levy or collection of taxes, to the same extent as if there had been an entry of judgment in their favor, issuance of execution and return thereof unsatisfied, service thereof upon public officials and performance of any and all other conditions precedent to the affording of such relief by a proceeding in lieu of prerogative writ under such other law; provided, that the court be first satisfied from proof submitted by affidavit or otherwise that the claims for the enforcement of which such remedy is sought are claims upon which a judgment could be obtained;
c. No action or proceeding shall be brought or prosecuted, the purpose of which is to affect the disposition of property or funds owned or controlled by the school district, except as herein provided; if any such school district has in its possession or under its control, or there is in the possession or under the control of the commission, any property or funds of such school district which are or may be available for the payment of interest or principal upon any of the debts of such school district (over and above the payment of the current operating expenses of the school district and the maintenance of a reasonable working capital), then such school district in its discretion may bring an action, or if directed by the commission shall do so, in the Superior Court to determine the application and distribution of such property or funds to and among the creditors of the school district, and in any such case the court in its discretion may permit an action for relief of the same character to be made by any creditor of the school district; in any such action, the court may proceed therein in a summary manner or otherwise, and all creditors of the school district shall be made parties thereto, and any creditor may appear therein and assert his rights to receive all or any part of such property or funds; in case any such action shall be instituted, the court may direct the municipality to make no payments from any of such moneys so available until the determination of the action or until permitted by the court; unless and until such a direction shall be made, payments may be made by such municipality on account of principal and interest as the municipality may determine and as may be approved by the municipal finance commission;
d. Upon the application of any creditor made upon notice to the school district and the commission, the Superior Court may vacate, modify or restrict any statutory stay contained in this article.
Amended by L.1953, c. 49, p. 883, s. 49.
