BEDMINSTER, N.J. -- Many in Washington might view it as judicial activism run wild: seven judges forcing this wealthy township to build housing for the less fortunate, nearly tripling its population.

But the New Jersey Supreme Court has never shied away from contentious social issues. By declaring that suburban "enclaves of affluence" have a legal obligation to provide housing for people of low or moderate income, the court has changed the face of rural towns such as Bedminster, where three-acre yards and $3 million mansions have been joined by relatively low-cost condominiums.

Despite fierce local opposition, Mayor Robert Lloyd said, "It's given some of the local people -- firemen, police, teachers -- the opportunity to buy a home in a very nice area."

Such far-reaching rulings have given the state's highest court a growing reputation as the nation's most innovative judiciary. From decisions on Karen Ann Quinlan in 1976 to Baby M this year, the court consistently has broken ground, often with sweeping prose that delights its admirers and infuriates its critics.

The justices, like their brethren in several other states, also have used their state constitution as a legal springboard to go well beyond the limits of U.S. Supreme Court rulings in such areas as civil liberties, capital punishment, abortion, housing and school finance. Although these decisions are binding only in New Jersey, they have fueled spirited debate among the nation's lawyers and lawmakers.

"The New Jersey Supreme Court is as innovative and creative a tribunal as there is," said Harvard Law School Prof. Laurence H. Tribe. He described the Baby M surrogate-mother ruling as "one of the most sensible and sage resolutions of an extremely difficult and almost intractable problem that I've seen by any court. It was lucid and almost poetic. It was really powerful."

But the court also has been shaken by a powerful backlash that has narrowed the impact of some of its broadest rulings. Two years ago, the state Senate nearly denied reappointment to Chief Justice Robert N. Wilentz, a former Democratic assemblyman.

Conservative senators, expressing anger about many of Wilentz's rulings, said he should be disqualified as the state's top jurist because he had moved to Manhattan. Wilentz, who said his wife's cancer treatments prompted the move from Perth Amboy, was reconfirmed, 21 to 19.

Gov. Thomas H. Kean (R), who ignored party politics in renominating Wilentz, has nevertheless assailed his 1983 housing decision as "communistic." One Republican lawmaker said Wilentz "should have been strung up" for a 1984 ruling that people who serve liquor are liable in a subsequent accident involving a drunken guest.

"They think, like all social planners, that their view of society is superior to everyone else's," state Sen. Gerald Cardinale (R) said. "The court is destroying the democratic process."

Others said the court is governing by default. "The other two branches leave a vacuum, so the Supreme Court has to engage in a little judicial legislation," said former governor Brendan T. Byrne (D), who appointed Wilentz in 1979. "I don't think they have ducked any issue."

Former chief justice Richard J. Hughes agrees. Hughes, who said he wielded nearly as much power in running the court in the 1970s as when he was the state's Democratic governor a decade earlier, commented, "The court is carving out some great new law. When the legislature didn't like to do the job, we had to take the bull by the horns."

The generally liberal court has held that the public cannot be barred from privately owned beaches and that battered women charged with murdering their husbands may cite prolonged physical abuse as a defense. But it also has upheld mandatory sentencing and drug paraphernalia laws.

That important legal trends emanate from places such as Trenton, N.J., defies the conventional wisdom that all legal roads end at the U.S. Supreme Court. "The federal Constitution sets a floor, and the states are free to raise that floor as long as they don't crash through some federal ceiling," Tribe said.

The Oregon Supreme Court, for example, has struck down state limits on the sale and distribution of pornography, while the Supreme Judicial Court in Massachusetts has held that the poor have a right to publicly funded abortions.

In 1947, a new New Jersey constitution replaced a weak, 16-member body with what is now the state's Supreme Court. Since then, while national scholars have debated the "original intent" of the U.S. Constitution, the New Jersey court has taken liberties with its founding document.

"It's perfectly clear from the record that the people who wrote the phrases in 1947 did not mean what the court later said they meant," said Rutgers Law School Prof. Robert Carter. In forcing New Jersey to revise its school-funding formula, the court has cited a single phrase in the state constitution that promises students a "thorough and efficient" education.

Wilentz said in a 1984 interview that the court follows "a tradition of reform . . . not so bound by prior decisions that you don't achieve sensible, reasonable results." While courts should not decide cases to please the public, he said, "a judge or justice who closes his eyes to the concerns of the public can be guilty of a lot of things. Sheer arrogance is one of those things."

Most of the court's members come from the political realm; only one previously served as a judge. Former governor Byrne named three of his counsels -- Alan B. Handler, Daniel J. O'Hern and Stewart G. Pollock -- and Kean picked his policy director, Gary S. Stein. Robert Clifford was a top aide to a previous Republican governor. And Wilentz had been the law partner of his father, the longtime Democratic boss of Middlesex County.

While the justices have avoided the kind of ideological splits that characterize the nation's Supreme Court, they lean noticeably to the left.

"I was considered one of the most conservative members of the court, but that's in New Jersey," former justice Sidney Schreiber said. "Put me in Indiana, and I'd be a wild man."

In its most important rulings, the court has:

Sharply limited the number of defendants eligible for the death penalty. In two decisions in October, the justices ruled out capital punishment for convicted murderers who did not intend to kill and for accomplices who did not inflict the fatal wounds.

Struck down surrogate-mother contracts that involve payments, saying that "baby-selling" is "degrading to women."

In the Baby M ruling, Wilentz wrote: "The long-term effects of surrogacy contracts are not known, but feared -- the impact on the child who learns her life was bought, that she is the offspring of someone who gave birth to her only to obtain money; the impact on the natural mother as the full weight of her isolation is felt along with the full reality of the sale of her body and her child; the impact on the natural father and adoptive mother once they realize the consequences of their conduct."

Shut down New Jersey's 2,500 public schools in 1976 after finding that funding formulas, based on local property taxes, unconstitutionally short-changed poorer districts. The schools reopened 11 days later when the legislature was forced to adopt the state's first income tax.

Allowed the parents of comatose Karen Ann Quinlan to remove her respirator. In the first of several "right-to-die" rulings in 1976, Hughes wrote that there was no state interest that "could compel Karen to endure the unendurable, only to vegetate a few measurable months with no realistic possibility of returning to any semblance of cognitive life."

Ruled that someone who directly serves liquor to an intoxicated guest can be sued by injured third parties if the guest later has a car accident. In a dissent from that 1984 ruling, Justice Marie L. Garibaldi, a Kean appointee and the first woman on the court, said it could be imposing "speculative . . . liability" on "every citizen of New Jersey who pours a drink for a friend."

Amid reports that many people and businesses no longer were having parties, the legislature last year voted to narrow the ruling, limiting it to hosts who knowingly provide alcohol to a visibly intoxicated guest.

Struck down local zoning ordinances that excluded low- and moderate-income residents. In a 1975 case involving the Philadelphia suburb of Mount Laurel, the court, citing a "desperate need for housing," said each of the state's 567 municipalities must accept a fair share of poor people.

Eight years later, the court produced "Mount Laurel II," a 270-page decision by Wilentz. It assailed the "social homogeneity" of rich suburbs for keeping the poor "locked into urban slums."

The court's lofty vision of affordable housing soon collided with reality. In 15 years, only 3,000 units of low-cost housing have been built in New Jersey -- none in Mount Laurel -- although state officials hope to approve another 40,000 over the next six years. Nearly two-thirds of New Jersey's towns have not submitted open-housing plans.

In 1986, the legislature passed a bill to transfer all open-housing cases to a new state agency. The high court blessed the measure, taking itself out of the zoning business.

"Courts are quite limited institutions," Carter said. "Courts simply don't have the time or machinery to supervise enormously complex, continuing projects."

The state since has adopted a controversial bartering system under which affluent suburbs can "export" half of their open-housing obligation by making payments to larger cities. For example, the town of Denville wants to spend $2 million to build low-cost housing in Newark.

While state officials defend the transfers as a boon to urban areas, Rutgers University housing expert John Payne said, "There's something distasteful about a wealthy suburb buying its way out of a social obligation."

Here in Bedminster, where horses long outnumbered people, the record is decidedly mixed.

On a hilly, 1,600-acre tract where bulldozers are clearing mud, 2,250 houses are being sold for $360,000 to $775,000. Thanks to the state Supreme Court ruling, another 476 condominiums have been built for low- or moderate-income families.

The light gray units are clustered in two-story buildings with tiny brick patios. A one-bedroom condominium apartment sells for $32,000, a three-bedroom for $40,000. Another 50 apartments rent for as much as $425 a month.

The condos have been bought by secretaries, mechanics, sales people, clerks and teachers, most of them single parents with children. To qualify, single wage-earners can earn no more than $24,000 a year. Yet, at that income level, many have had trouble qualifying for mortgages.

"It's sort of borderline affordable at this point," said Rose Eaton, executive director of the Bedminster Hills Housing Corp.

Most of the 11,000 applicants have come from surrounding Somerset County.

"These are not your Newark type of people," Eaton said. Fewer than a dozen black families have bought the condominiums.

In boosting the town's population from 2,400 to 6,400, the development has forced a doubling of the seven-member police force and construction of a second elementary school.

"There are some who will say it looks like a blot on the landscape, but it's very nicely done," Mayor Lloyd said. "There are still a percentage of people who will never accept it. But a lot of people thought the town was going to go to hell in a handbasket, and that didn't happen."