Leandro case’s latest twist involves ‘subject matter jurisdiction’

An education funding battle that has lingered in North Carolina’s courts for nearly three decades could stand or fall based on a single technical issue.

It’s called “subject matter jurisdiction.”

Simply put, the case could depend on whether a trial judge had authority this spring to order $677 million in new state education spending. If not, it’s unlikely any judge could order hundreds of millions — even billions — in additional future funding.

The state Supreme Court agreed on Oct. 20 to review the case again. That decision came just 11 months after the high court’s last major ruling.

The November 2022 decision produced a party-line split. The court’s 4-3 Democratic majority paved the way for the trial judge’s remedial order, including its $677 million spending mandate.

But voters replaced two Democratic justices just days after that decision. Now Republicans hold a 5-2 state Supreme Court majority.

The court’s ongoing partisan divide even extends to the case’s name. Democrats label last November’s decision “Leandro IV,” citing the original lead plaintiff in a 1994 lawsuit. In contrast, Republicans call the 11-month-old ruling “Hoke County III.” They emphasize the case’s ties to the lone trial conducted during the 29-year dispute. That trial addressed school funding issues in a single county.

The Oct. 20 order explained that the Supreme Court granted Republican legislators’ request for a new review “solely on the question of whether the trial court lacked subject matter jurisdiction to enter its order.”

For dissenting Democrats, that issue already has been resolved. Justice Anita Earls rejected lawmakers’ request as “substantively hollow and procedurally improper.”

“This Court resolved the question of subject-matter jurisdiction in Leandro IV,” Earls wrote. “Legislative-Intervenors raised the same arguments they do in their bypass petition: That the trial court lacked jurisdiction to remedy constitutional deficiencies in public education. We examined that claim and ‘unequivocally rejected’ it.”

Earls targeted lawmakers’ arguments that the case should be limited to Hoke County schools.

“Since the trial court found a statewide constitutional violation, … it had subject-matter jurisdiction to order a statewide remedy,” she wrote. “But the Legisative-Intervenors ignored the trial court’s sound analysis and solid conclusion. They instead argued before us — as they do now in their petition — that ‘there has never been a finding’ of a constitutional violation ‘beyond Hoke County.’ We rebuffed that argument. And we went further, decrying it as ‘a fundamental misunderstanding of the history of this case and the State’s constitutional obligations.’”

“If parties can reopen a case by casting their disagreement in the language of ‘jurisdiction,’ then our courts will be nothing but revolving doors and our decisions nothing but paper tigers,” Earls wrote. “This case shows the danger of that approach.”

Three Republicans — led by Justice Phil Berger Jr. — responded to Earls’ complaint.

“The premise of the dissent is that this Court already ‘resolved the question of subject-matter jurisdiction in [Hoke County III].’ The dissent is wrong,” Berger wrote.

Berger noted that only a handful of the state’s 115 school districts have taken part in the dispute.

“If public school students or local school boards who are not parties to this case believe the remedial order does not sufficiently address the educational failure in their districts, are they bound by the remedial order?” Berger wrote. “If so, how were their rights adjudicated without their presence in the suit — an elementary principle of jurisdictional law?”

Berger added that Earls and the previous Supreme Court majority “rushed to complete its earlier opinion in this incredibly complex, novel case (one that has spanned decades) so that it could be released in November of last year. The failure to resolve these jurisdictional questions is not the first oversight from this Court’s rush to judgment in Hoke County III.”

“My dissenting colleague laments that subject matter is now being addressed because it will cause various harms to judicial integrity and ‘snuff out legal finality,’” Berger said of Earls. “Once again, we endure ad nauseum these fanciful protestations. But it is black letter law that courts cannot ignore potential defects in subject matter jurisdiction.”

Berger predicted “tremendous chaos” if jurisdictional issues remain unresolved.

“In its rush to publish an opinion in the prior matter, the majority declined to address fundamental subject matter jurisdiction questions,” Berger concluded. “To be sure, these issues were raised, but the majority chose to ignore the bedrock legal principle that courts must examine jurisdiction to act. Even legal neophytes understand that subject matter jurisdiction can never be waived and can be raised at any time.”

Now Berger, Earls, and their colleagues have another chance to address “fundamental” issues. Whether it’s Hoke County IV or Leandro V, the next chapter could help resolve a three-decade-old legal story.

Mitch Kokai is senior political analyst for the John Locke Foundation.