wages - FLSA pre-empts Art. III, sec. 24 of Pennsylvania Constitution

Council 13, AFSCME v. Commonwealth of Pennsylvania

Pennsylvania Supreme Court - December 28, 2009

majority - http://origin-www.courts.state.pa.us/OpPosting/Supreme/out/J-98-2009mo.pdf

consurring and dissenting opinion http://origin-www.courts.state.pa.us/OpPosting/Supreme/out/J-98-2008codo.pdf

Article III, Section 24* of the Pennsylvania Constitution is preempted by the Fair Labor Standards Act of 1938, 29 U.S.C. § 206(a).

The governor is not prohibited from paying the wages of state employees who are covered by FLSA, but who are required to work from monies in the Commonwealth’s Treasury, where that money has not yet been appropriated by the General Assembly.

* Section 24 provides: No money shall be paid out of the treasury, except on appropriations made by law and on warrant issued by the proper officers; but cash refunds of taxes, licenses, fees, and other charges paid or collected, but not legally due, may be paid, as provided by law, without appropriation from the fund into which they were paid on warrant of the proper officer. PA. CONST. art. III, § 24.

contracts - attorney fees - reasonableness

McMullen v. Kutz - Supreme Court - December 28, 2009

majority opinion - http://origin-www.courts.state.pa.us/OpPosting/Supreme/out/J-93-2008mo.pdf

concurrence/dissent - http://origin-www.courts.state.pa.us/OpPosting/Supreme/out/J-93-2008codo.pdf

dissent - http://origin-www.courts.state.pa.us/OpPosting/Supreme/out/J-93-2008do.pdf

The parties entered into a marriage and property settlement agreement that provided for the payment of attorney fees and costs incurred by one party in enforcing the contract against the breaching party. The agreement did not specify that the fees had to be reasonable.

The dispute in this case concerns the trial court’s authority to address the reasonableness of the attorney fees claimed. Wife, and a minority of courts across the country, would read the plain language of the contract to require any and all fees incurred by the non-breaching party to be payable by the breaching party. We cannot accept this reading, however, because the potential for abuse is too high. If we were to forbid a reasonableness inquiry by a trial court, there would be no safety valve and courts would be required to award attorney fees even when such fees are clearly excessive.

Instead, we join the majority of our sister states n.3 in finding that parties may contract to provide for the breaching party to pay the attorney fees of the prevailing party in a breach of contract case, but that the trial court may consider whether the fees claimed to have been incurred are reasonable, and to reduce the fees claimed if appropriate. We hold that the trial court had the authority to consider the reasonableness of the attorney fees claimed. Accordingly, we affirm the decisions of the Superior Court and the trial court.

++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++

Footnote 3 - See, e.g., Alabama Educ. Ass’n v. Black, 752 So.2d 514, 519 (Ala. Civ. App. 1999) (“In Alabama, where there is an agreement to pay an attorney fee and the agreement does not speak specifically to the reasonableness of the fee, a “reasonable” fee will be inferred.”); McDowell Mountain Ranch Community Ass'n, Inc. v. Simons, 165 P.3d 667, 671 (Ariz. Ct. App. 2007) (collecting cases and stating: “Notwithstanding the general rule that attorneys' fees are enforced in accordance with the terms of a contract, a contractual provision providing for an award of unreasonable attorneys' fees will not be enforced.”); Griffin v. First Nat. Bank of Crossett, 888 S.W.2d 306, 311 (Ark. 1994) (“Implicit in our holding is a requirement that any attorney's fees awarded should be reasonable.”); Crest Plumbing and Heating Co. v. DiLoreto, 531 A.2d 177, 183 (Conn. App. Ct. 1987) (“We construe the term ‘attorney's fees’ as an award for ‘reasonable attorney's fees’ in this case because the term ‘reasonable’ is implied by law even when it is absent in the contractual provision.”) (emphasis in original); Mahani v. Edix Media Group, Inc., 935 A.2d 242, 245 - 246 (Del. 2007) (“Delaware law dictates that, in fee shifting cases, a judge determine[s] whether the fees requested are reasonable.”); Concord Enterprises, Inc. v. Binder, 710 A.2d 219, 225 (D.C. 1998) (“[W]here a contractual agreement expressly provides for the payment of attorney's fees, the trial court's discretion is limited to ascertaining what amount constitutes a ‘reasonable’ fee award.”); Dunn v. Sentry Ins., 462 So.2d 107, 108 (Fla. Dist. Ct. App. 1985) (holding that a prevailing party is not entitled to recover the total amount which it has paid or agreed to pay if that amount is excessive or unreasonable); Lettunich v. Lettunich, 111 P.3d 110, 120 (Idaho 2005) (providing for trial courts to consider several factors in arriving at a reasonable attorney fee calculation); Heller Financial, Inc. v. Johns- Byrne Co., 637 N.E.2d 1085, 1092 (Ill. App. Ct. 1994) (“While the parties may, by a private agreement, override the “American Rule” which holds that each will be responsible for any legal fees they incur in a civil litigation, such contractually-provided fees will be approved by the court only if they are reasonable.”); Walton v. Claybridge Homeowners Ass'n, Inc., 825 N.E.2d 818, 826 (Ind. Ct. App. 2005) (“Attorney fees awarded under a contract must be reasonable.”); Ales v. Anderson, Gabelmann, Lower & Whitlow, P.C., 728 N.W.2d 832, 842 (Iowa 2007) (“When a written contract allows for the recovery of attorney's fees, the award must be for reasonable attorney's fees.”); Hollenbach v. Holden, 728 So.2d 544, 551 (La. Ct. App.1999) (“[I]mplied within the attorney's fee provision of the contract is that the amount of attorney's fees to be determined to be due either party will be reasonable.”); Yim K. Cheung v. Wing Ki Wu, 919 A.2d 619, 625 (Me. 2007) (“As a general rule, courts must enforce contract provisions that require the payment of attorney fees, so long as they are reasonable.”); Myers v. Kayhoe, 892 A.2d 520, 532 (Md. 2006) (“Even in the absence of a contract term limiting recovery to reasonable fees, trial courts are required to read such a term into the contract and examine the prevailing party's fee request for reasonableness.”); Zeeland Farm Services, Inc. v. JBL Enterprises, Inc., 555 N.W.2d 733, 736 (Mich. Ct. App. 1996) (“[R]ecovery is limited to reasonable attorney fees.”); State Bank of Cokato v. Ziehwein, 510 N.W.2d 268, 270 (Minn. Ct. App. 1994) (“Where loan documents authorize a lender to recover legal expenses associated with collection, however, Minnesota courts will enforce the provision as long as the fees are reasonable.”); Belfer v. Merling, 730 A.2d 434, 443 (N.J. Super. Ct. App. Div. 1999) (“[A]ny fee arrangement is subject to judicial review as to its reasonableness.”); Robison v. Katz, 610 P.2d 201, 209 (N.M. Ct. App. 1980) (“It is clearly within the equitable power of the court to consider and reduce excessive fees.”); SO/Bluestar, LLC v. Canarsie Hotel Corp., 825 N.Y.S.2d 80, 81 - 82 (N.Y. App. Div. 2006) (“While the plaintiff was entitled to attorneys' fees pursuant to the Note, [a]n award of attorneys' fees pursuant to such a contractual provision may only be enforced to the extent that the amount is reasonable and warranted for the services actually rendered.”) (internal quotations omitted); Northwoods Condominium Owners' Ass’n v. Arnold, 770 N.E.2d 627, 630 - 631 (Ohio Ct. App. 2002) (“Under Ohio law, contractual provisions awarding attorney fees are enforceable and not void as against public policy so long as the fees awarded are fair, just, and reasonable as determined by the trial court upon full consideration of all the circumstances of the case.”); Benchmark Northwest, Inc. v. Sambhi, 83 P.3d 348, 349 (Or. Ct. App. 2004) (“The award is mandatory; the trial court has no discretion to deny it, although it does have discretion as to what amount is ‘reasonable.’”); South Carolina Elec. & Gas Co. v. Hartough, 654 S.E.2d 87, 91 (S.C. Ct. App. 2007) ( “When an award of attorney's fees is based upon a contract between the parties, the determination of the fees is left to the discretion of the trial court and will not be disturbed absent an abuse of discretion.”); Trayner v. Cushing, 688 P.2d 856, 858 (Utah 1984) (“Where the parties have agreed by contract to the payment of attorney fees, the court may award reasonable fees in accordance with the terms of the parties' agreement.”); Dewey v. Wentland, 38 P.3d 402, 420 (Wyo. 2002) (“Even in the face of a valid contractual provision for attorney's fees, we have clearly stated that a trial court has the discretion to exercise its equitable control to allow only such sum as is reasonable or the court may properly disallow attorney's fees altogether on the basis that such recovery would be inequitable.”

disability - obesity - evaluation of effect in combination with other impairments

Simmons v. Astrue - ED Pa. - December 28, 2009


http://www.paed.uscourts.gov/documents/opinions/09D1507P.pdf


The court ordered the case to be remanded (again) because of the ALJ's faiulure to provide a thorough explanation of the effects of the combination of plaintiff’s obesity with her other impairments.


SSR 02-1p (Titles II and XVI: Evaluation of Obesity) states that while the SSA deleted obesity from its listing of impairments in 1999, the SSA continued to ensure that obesity is addressed in the listings: “[W]e consider obesity to be a medically determinable impairment and remind adjudicators to consider its effects when evaluating disability. . . . [T]he combined effects of obesity with other impairments can be greater than the effects of each of the impairments considered separately.”

SSR 02-1p further states that “[t]he effects of obesity may not be obvious. For example, some people with obesity also have sleep apnea. This can lead to drowsiness and lack of mental clarity.” SSR 02-1p makes clear that obesity is to be considered at steps 3, 4, and 5 of the sequential evaluation.

In the present case, the ALJ received specific instructions from the Appeals Council to provide an evaluation of the impact of Plaintiff’s obesity in accordance with SSR 02-1p. Thus, the ALJ was required to provide an explanation of how she considered Plaintiff’s obesity in combination with Plaintiff’s other severe impairments. Yet, the ALJ’s remand decision fails to do so. Indeed, all the ALJ did with respect to the Appeals Council’s instruction was provide a one-sentence conclusion stating her ultimate decision on the matter. The ALJ’s decision provides no reasoning, analysis, or explanation as to why Plaintiff’s obesity “does not increase the severity of claimant’s existing impairments.” Instead, the ALJ disposes of the obesity issue without providing any explanation. Therefore, the Court believes that the ALJ’s remand decision fails to follow the Appeals Council’s order to consider Plaintiff’s obesity in accordance with SSR 02-1p.

The ALJ’s use of one conclusory sentence to evaluate and analyze Plaintiff’s obesity in the written decision falls far short of the further evaluation required by the Appeals Council. Such a holding is in accordance with established case law from this district.

In Elam v. Astrue, 2009 WL 2779135 (E.D. Pa. Sept. 2, 2009), the court stated: “The ALJ must . . . engage in and document his or her analysis of the obesity in step three of the sequential analysis forward. This is especially imperative when assessing the impact of obesity on musculoskeletal, respiratory, and cardiovascular impairments like those at issue in this case.” Similarly, in Morris v. Barnhart, 2004 WL 1238397 (E.D. Pa. May 10, 2004), the court required a remand for essentially the same reason.

Similarly here, the ALJ failed to provide any analysis – thorough or otherwise – regarding the effect of the combination of Plaintiff’s obesity on her other impairments, as was specifically required by the Appeals Council when ordering remand. In the absence of any such analysis, the Court is unable to determine whether the ALJ’s decision is supported by substantial evidence. Therefore, as in both Elam and Morris, this case must be remanded to the ALJ.

juvenile record - expungement - 18 Pa. CS 9123 - "cause shown"

In the Interest of A.B. - Superior Court - December 24, 2009


http://origin-www.courts.state.pa.us/OpPosting/Superior/out/E05005_08.pdf

Appellant, A.B., appeals from the order entered in the Monroe County Court of Common Pleas, which denied his petition to expunge his juvenile record. Specifically, Appellant asks us to determine whether the court committed an error of law or an abuse of discretion when it denied Appellant’s petition, after he had fulfilled all of the requirements for expungement under 18 Pa.C.S.A. § 9123(a)(3), the Criminal History Record Information Act (“CHRIA”).

We hold the trial court misapplied the law in denying Appellant’s expungement petition, where Appellant fulfilled the requirements under Section 9123(a)(3); and the Commonwealth failed to show cause to deny expungement and retain Appellant’s juvenile record. Accordingly, we reverse and remand with directions to expunge Appellant’s juvenile recore.

The CHRIA states the court “shall” expunge a juvenile record where the petitioner meets the requirements of any subsection under Section 9123(a)(3), unless the Commonwealth successfully justifies retention of the juvenile record, otherwise stated as “except upon cause shown.” 18 Pa.C.S.A. § 9123(a)

The lower courts misconstrued the "cause shown" language by applying adult cases and criteria.

The lower court relied on a criminal drug statute, because the juvenile offense involved possession with intent to distribute. However, Appellant was not charged with,indicted for, or convicted of committing PWID or any other criminal offense. Rather, the juvenile court adjudicated Appellant delinquent on a juvenile offense. See 42 Pa.C.S.A. § 6354(a)...In relying on Section 780-119(a), the Commonwealth essentially treated Appellant’s juvenile adjudication as synonymous with a criminal record, which blurred the fundamental and material differences between the Juvenile Code and the Crimes Code.

The lower courts also improperly relied on the decision in Commonwealth v. Wexler, 494 Pa. 325, 431 A.2d 877 (1981), which applied its factors test only to the adult expungement petitions before that Court, and declined to extend that analysis to the juvenile expungement petition at issue in the case.

Appellant had no record before his adjudications, he was a juvenile at the time of the offense, and subsequently he is living a law-abiding life. When Appellant filed his expungement petition, he worked a steady job, resided with his mother, and attended community college. Thus, Appellant demonstrated the conditions necessary to reasonably assure his redemption, consistent with the criteria in Section 9123(a)(3). Further, we recognize there are numerous adverse consequences inherent in the existence of a juvenile record, including the elusive stigma attached to an adjudication of delinquency, which the expungement statute sought to eliminate. Id. Appellant met the statutory requirements for expungement; he had no additional burden to show specific adverse consequences suffered before relief could be granted. Given the remedial nature of Section 9123(a), Appellant was entitled to a liberal construction and application of the statute, while the “show cause” exception to the remedial provisions should have been narrowly construed against the Commonwealth as its proponent.

Appellant was entitled to expungement of his juvenile record as a matter of law, because he met the requirements under 18 Pa.C.S.A. § 9123(a)(3). Five (5) years elapsed since his final discharge from probation, he has not been convicted of a subsequent felony, misdemeanor or adjudication of delinquency, and no proceeding is pending seeking a conviction or adjudication. Appellant maintains he finished high school, works a steady job, takes courses at a community college, and has had no further encounters with the legal system since the one in 1999. Under the statute, he was entitled to have his record expunged.

UC - willful misconduct - lateness - child-care problems

Mount Airy Casino Resort v. UCBR - Cmwlth. Court - December 23, 2009 - unreported memorandum opinion


http://origin-www.courts.state.pa.us/OpPosting/Cwealth/out/791CD09_12-23-09.pdf


child care problems can be "good cause" for lateness or absence
The court affirmed the UCBR holding that the claimant, who was sometimes late for work because of child-care problems, was not guilty of willful misconduct because he had "good cause for his absences and late arrivals. An employee may be entitled to receive benefits despite the violation of a work rule if he can demonstrate “good cause for his actions.” Crawford v. UCBR, 455 A.2d 751, 752 (Pa. Cmwlth. 1983).

Even "excessive late arrivals or absences will not constitute willful misconduct if the employee has good cause for the absences or late arrivals and properly reports them. Gillespie v. UCBR, 523 A.2d 1205, 1207 (Pa. Cmwlth. 1987). The necessity of taking care of children can constitute good cause. Mulqueen v. UCBR, 543 A.2d 1286, 1288 (Pa. Cmwlth. 1988); King v. UCBR, 414 A.2d 452, 455 (Pa. Cmwlth. 1980).

voluntary quit v. termination due to child-care issues
In cases where a claimant voluntarily quits due to childcare issues, the court has required a showing that the claimant reasonably investigated options to obtain the necessary childcare prior to quitting. Shaffer v. UCBR, 928 A.2d 391, 394 (Pa. Cmwlth. 2007); Beachem v. UCBR, 760 A.2d 68, 71 (Pa. Cmwlth. 2000). The court appears to have applied a similar standard in determining whether a claimant had good cause for an absence that led to her termination in King, 414 A.2d at 455 (noting that the claimant’s “efforts to make child care arrangements with friends, neighbors, relatives and day care centers were more than reasonable”).


The court found, however, that "there is a qualitative difference between a claimant who quits due to childcare issues and one who is terminated despite attempting to continue working in good faith. Importantly, a claimant who decides to quit his employment due to childcare reasons is in control of when the employment relationship ultimately ends. Therefore, it is expected that such a claimant will make substantial efforts in searching for alternative childcare before he resorts to quitting due to a lack of childcare. [emphasis added]

On the other hand, where a claimant is discharged from his employment for absenteeism or tardiness, the claimant is not in control of when the employment relationship ends, and the claimant must operate under more limited time constraints that are dictated, in large part, by the employer." While a claimant with a child-care problem "is expected to make reasonable efforts to find alternative childcare before he may use lack of childcare to establish a good cause basis for being absent or tardy, he is not necessarily required to make the same efforts that would be needed to justify quitting due to a lack of childcare." [emphasis added]

In this case, the record supports a finding that the claimant made sufficient attempts to arrange for alternative childcare under the circumstances. It also showed the "employer’s own acknowledged unwillingness to work with Claimant to arrange a schedule that would accommodate Claimant’s childcare needs."

Therefore the court "agreed with the Board that, under the circumstances of this case, Claimant had good cause for his final late arrivals and these late arrivals do not, therefore, rise to the level of willful misconduct."

housing - sec. 8 - termination - grounds - notice by T of intent to move to new unit - no HA approval required

Cain v. Allegheny Co. Housing Authority - Cmwlth. Court - December 22, 2009

http://origin-www.courts.state.pa.us/OpPosting/Cwealth/out/2440CD08_12-22-09.pdf

Sec. 8 tenant properly gave the housing authority notice of the fact that she was moving out of her apartment and moving to another unit, pursuant to the HA's termination notice due to her failure to pay rent and a plumbing bill. The tenant was not required to get the HA's approval to do this and thus the HA's proposed termination of her sec. 8 benefits was not proper.

The applicable regulation, 24 C.F.R. §982.552, provides that:

(b) Requirement to deny admission or terminate assistance (2) The PHA [Public Housing Authority] must terminate program assistance for a family evicted from housing assisted under the program for serious violation of the lease…

(c) Authority to deny admission or terminate assistance. (1) Grounds for denial or termination of assistance. The PHA may at any time deny program assistance for an applicant, or terminate program assistance for a participant, for any of the following grounds: (i) If the family violates any family obligations under the program (see §982.551) See §982.553 concerning denial or termination of assistance for crime by family members…. (Emphasis added).

Also relevant is sec. 982.314, which governs when a tenant can move to a new unit, with continuing sec. 8 assistance. The grounds for denial under this section are the same as those set out in §982.552(c). The failure to obtain approval of a move is not an enumerated basis to terminate assistance.

We agree with Tenant and the decisions of our sister courts that the ACHA cannot expand the basis for terminating assistance by stating that failure to obtain approval prior to a move can result in that consequence. Hill v. Richardson, 740 F.Supp. 1393 (SD Ind. 1990), vacated and remanded, 7 F.3d 656 (7th Cir. Ind. 1993); Holly v. Housing Authority of New Orleans, 684 F.Supp. 1363 (ED La. 1988); Smith v. Hamilton County, 2007 Ohio 1725 (Ohio App. 1 Dist. 2007).

HEMAP - circumstances - voluntary hardship - financial overextension

Schrack v. PHFA - Cmwlth. Court - December 21, 2009 - unreported memorandum decision

http://origin-www.courts.state.pa.us/OpPosting/Cwealth/out/719CD09_12-21-09.pdf

A homeowner’s voluntary decision which results in financial hardship does not constitute circumstances beyond a homeowner’s control. Cullins v. PHFA, 623 A.2d 951, 953 (Pa. Cmwlth. 1993).

The record here shows that when the applicant refinanced her home in 2006 in order to rebuild it after a fire, her monthly expenses exceeded her net monthly income and continues to do so. The Agency determined that the applicant became financially overextended with the origination of the mortgage and has remained financially overextended since the mortgage origination, and thus that she was not suffering financial hardship due to circumstances beyond her control. Whatever hardship was suffering was due not to her being laid off from work but rather her overextending herself prior to her unemployment.

Her contention that she would be employed soon, as would her fiancé, "cannot be the basis for the agency’s determination, as both contentions are speculative." The Agency is bound to evaluate a petitioner’s eligibility on the basis of her actual income history. Cullins. The Agency here properly considered petitioner’s only source of guaranteed income, unemployment benefits.

"As Petitioner’s income had been, and continued to be, inadequate to support her total housing expense, we conclude that the Agency was correct in determining that Appellant’s financial situation was simply the result of long term financial difficulties and not the emergency situation contemplated by Act 91."

UC - reopening of hearing - good cause

Motley v. UCBR - Cmwlth. Court - December 16, 2009 - unreported memorandum decision

http://origin-www.courts.state.pa.us/OpPosting/Cwealth/out/426CD09_12-16-09.pdf

Claimant did not show good cause for missing her UC hearing under 34 Pa. Code 101.24(a), which says that

If a party who did not attend a scheduled hearing subsequently gives written notice, which is received by the tribunal prior to the release of a decision, and it is determined by the tribunal that his failure to attend the hearing was for reasons which constitute ‘proper cause,’ the case shall be reopened. 34 Pa. Code §101.24(a) (“Reopening of hearing”).

If the Board determines that a claimant did not have proper cause for failing to attend the referee’s hearing, then it must issue a decision based on the evidence developed in the claimant’s absence. Ortiz v. UCBR, 481 A.2d 1383 (Pa. Cmwlth. 1984).

In determining whether a claimant had proper cause for failing to attend a referee’s hearing, the Court in Savage v. UCBR, 491 A.2d 947, 950 (Pa. Cmwlth. 1985), concluded “a claimant's own negligence is insufficient ‘proper cause,’ as a matter of law, to justify his failure to appear at a referee's hearing ….”

The Court concluded here that it was the claimant’s own negligence that caused her failure to appear, and that her negligence was insufficient proper cause. The claimant testified that she had become lost and couldn't find the hearing office. The Board and court felt that she should have made more effort to find the hearing locations, including taking a test trip prior to the hearing.

admin. law - appeal - final adjudication

NHS Human Services v. DPW - December 8, 2009 - Commonwealth Court

http://origin-www.courts.state.pa.us/OpPosting/Cwealth/out/347CD09_12-8-09.pdf

In holding a warning was not a final adjudiction under the Administrative Agency Law, 2 Pa. C.S. §§ 501-508, 701-704, the Court said that an "An adjudication is defined as 'Any final order, decree, decision, determination or ruling by an agency affecting personal or property rights, privileges, immunities, duties, liabilities, or obligations of any or all of the parties to the proceeding in which the adjudication is made.' 2 Pa. C.S. §101.

A letter or an email message can constitute an adjudication, requiring notice and a hearing, if a two-prong test is met: 1) the letter must be an agency’s final order, decree, decision, determination or ruling; and 2) it must impact on a party’s personal or property rights, privileges, immunities, duties, liabilities or obligations. Guthrie v. Borough of Wilkinsburg, 505 Pa. 249, 478 A.2d 1279 (1984), Benson Lincoln Mercury, Inc. v. DOT, 602 A.2d 496 (Pa. Cmwlth. 1992), and Fiore v. DER, 510 A.2d 880 (Pa. Cmwlth. 1986).

UC - voluntary quit - racial discrimination

Atlas Machining and Welding v. UCBR - December 8, 2009 - Cmwlth. Court - unreported memorandum opinion


http://origin-www.courts.state.pa.us/OpPosting/Cwealth/out/651CD09_12-8-09.pdf


The court affirmed a Board decision finding that an African-American claimant had good cause to quit because of racial harassment, including racial slurs by a co-worker and foreman and several instances of his finding a rope fashioned in the shape of a noose.


"There is no question that racial discrimination may constitute necessitous and compelling cause to terminate one’s employment. Taylor; Brown v. UCBR, 780 A.2d 885 (Pa. Cmwlth. 2001); McIntyre v. UCBR, 420 A.2d 34 (Pa. Cmwlth. 1980); Watts v. UCBR, 410 A.2d 976 (Pa. Cmwlth. 1980)."

Given the employer's "ineffectual" attempts to address these problems, it would have been futile for claimant to pursue things further with the employer. Claimant thus had good cause to quit.

housing - code enforcement - illegal search - civil rights

Ciarlone v. City of Reading - ED Pa - November 18, 2009

http://www.paed.uscourts.gov/documents/opinions/09d1382p.pdf

Apartment owner and several tenants brought sec. 1983 action against city, code enforcement officer, et al. for unlawful inspection of premises by forced actions -- including breaking into apartments with sledge hammer -- without any warrant or notice to owner or tenants.

Defendants' motion to dismiss was rejected by the court, which held that plaintiffs had pleaded sufficient facts concerning a) the constitutionality of the search, b) the city's failure educate and train code enforcement officers, c) due process claims. and d) first amendment retaliation (plaintiff owner had publicly and repeatedly spoken out against the city code enforcement department) to survive a 12(b)(6) motion to dismiss.

consumer - natl. banks - gift card - state UDAP claims - no pre-emption

Mwantembe, et al. v. TD Bank, et al. - ED PA - November 17, 2009

http://www.paed.uscourts.gov/documents/opinions/09d1375p.pdf

Plaintiff brought class action on behalf of Pennsylvania residents who held or hold gift cards sold by the defendants, assert causes of action under Pennsylvania law for violations of the Unfair Trade Practices and Consumer Protection Law (“UTPCPL”), 73 P.S. §§ 201-2(3), 201-2(4)(xxi), 201-3, breach of contract and third party beneficiary.

They allege that the defendants’ deducting undisclosed dormancy and other fees that diminish the value of the gift cards before their expiration is “deceptive, unlawful, and misleading,” and is calculatedto “trick, mislead, and significantly confuse consumers in Pennsylvania into not retaining or claiming the full value and buying power” of the cards.

The plaintiffs allege that the defendant banks marketed and sold the gift cards without adequately disclosing the cards’ material terms and conditions to purchasers and recipients. They also claim that prior to purchase, the defendants’ representatives never discussed or otherwise disclosed to purchasers the imposition of dormancy and replacement fees, or issue dates and expiration dates.

The question is whether state law imposing disclosure and marketing requirements for gift cards prevents or significantly interferes with the national banks’ activity or the federal regulator’s exercise of its powers.

Because enforcing state consumer protection laws regarding the disclosures does not conflict with federal law governing gift cards and will not unduly impair the defendants banks’ ability to engage in the business of selling gift cards, we hold that the plaintiffs’ state law claims are not preempted.

UC - appeal - lack of jurisdiction

Pa. Turnpike Commission v. UCBR - Cmwlth. Court - December 3, 2009

http://www.pacourts.us/OpPosting/Cwealth/out/1104CD09_2-19-10.pdf

The court upheld a UCBR decision that a UC Service Center did not have jurisdiction to issue an amended financial determination, finding claimant ineligible under sec. 1002(11) (policy-making services excluded from "employment"), when it had previously issued a financial determination finding claimant eligible.

= = = = = = = = = = = = =

Claimant was laid off from her job on November 20th, when her position was eliminated. She applied for UC shortly after that time.

On December 2nd, the UCSC issued a financial determination notice (First Notice) finding the claimant was financially eligible for UC. Claimant began receiving benefits. The Notice advised the employer that it had until December 17th to appeal. It did not do so.

On January 20, 2009, and "without any intervening activity of record," the UCSC issued a Second Notice of financial determination finding claimant not financially eligible, because her job involved making policy decision. Claimant filed a timely appeal.

At the ensuing referee, claimant testified that her duties did not involve making policy decisions. The employer witness testified that employer did not receive the First Notice but that it would have known about claimant's receipt of UC benefits shortly after payments began. Employer did not appeal from the First Notice.

The Board affirmed the referee decision that, because Employer did not appeal the First Notice, the UCSC lacked jurisdiction to issue the Second Notice, where it was outside of the appeal period, citing 43 P.S. 821(3), which says that a party must appeal a determination within 15 days.

The court held that the Service Center did not have jurisdiction to issue the Second Notice.

Section 501(e) of the Law, 43 P.S. §821(3), provides. . .that a party must appeal a determination within 15 calendar days after such notice was delivered to that party personally or was mailed to his or her address. The Service Center may issue a revised notice of determination within the appeal period if no appeal has been filed. Garza v. UCBR, 669 A.2d 445 (Pa. Cmwlth. 1995). However, the Service Center may not issue a revised notice of determination after the appeal period has expired; the determination becomes final and the Board loses jurisdiction to consider the matter. Vereb v. UCBR, 676 A.2d 1290 (Pa. Cmwlth. 1996). It is well-settled the statutory time limit for filing an appeal is mandatory in the absence of fraud or a breakdown in the administrative agency. First Nat’l Bank of Bath v. UCBR, 619 A.2d 801 (Pa. Cmwlth. 1993).

Here, the certified record lacks any indication Employer attempted to appeal the First Notice, and HR Director admitted as much. Absent an appeal, the First Notice became final and binding on the parties and, concomitantly, deprived the Service Center of jurisdiction to issue the Second Notice. Vereb; First Nat’l Bank. Thus, we discern no error in the Board’s order vacating the Second Notice. (emphasis added)

The court also rejected the Employer argument that it had submitted documents that showed an intent to appeal. First, the court noted that the documents were not part of the certified record. More important, however, the court held that even

assuming the forms evidenced Employer’s intent to challenge the Service Center’s eligibility determination, they do not negate Employer’s obligation to file an appeal of the First Notice. In First National Bank of Bath, [619 A.2d 801 (Pa. Cmwlth. 1993)], [t]his Court rejected the employer’s assertions the form [requesting relief from charges] manifested its intent to appeal. We explained that “[t]he language of [S]ection 501(e) … is both clear and mandatory. Employers have fifteen (15) days to file an appeal from a determination … or that determination ‘shall be final and compensation shall be paid or denied in accordance therewith.’ Because appeal provisions of the [Law] are mandatory, appellants carry a heavy burden to justify untimely appeals, and absent proof of fraud, cannot prevail.” 619 A.2d at 803. (First emphasis added).

Applying the above principle here, none of Employer’s forms can substitute for an appeal unless they specifically advise the Board that Employer appealed. See 34 Pa. Code §101.82(c)(1) (use of the prescribed form is not mandatory to initiate an appeal; any written notice specifically advising that the interested party is filing an appeal or requesting review of a decision is sufficient). Once again, the lack of the forms in the record prevents review to determine whether Employer specifically advised the Board it was appealing the First Notice.

admin. law - regulations - type, adoption, validity

Slippery Rock School District v. UCBR - Pennsylvania Supreme Court - November 30, 2009

http://origin-www.courts.state.pa.us/OpPosting/Supreme/out/J-72-2009mo.pdf

This case concerns the adoption by the Pennsylvania Dept. of Labor and Industry (DOLI) of a UC regulation concerning benefits for teachers and other educ. employees, who are disqualified from receiving benefits if they have a "reasonable assurance" of continuing employment during the ensuing regular school period, UC Law sec. 402.1, 43 P.S. sec. 802.1.

The regulation involved established a new test of "economic equivalency" -- that there is reasonable assurance only if the "economic terms and conditions" offered for the ensuing academic period are "not substantially less that the terms and conditions of the individual's employment" prior to being laid off at the end of the first academic period. 34 Pa. Code sec. 65.161(a)

In holding that the DOLI regulation in question was valid, the court discussed several important features of state administative law concerning the types, adoption, and validity of regulations.

Pennsylvania courts have developed a two-step process for determining whether an administrative regulation is mandatory and binding. First, a court must determine what type of regulation it is examining (legislative or interpretive) and second, whether the regulation is valid.
Depending on what type it is, the regulation may be either binding (legislative) or merely entitled to deference (interpretive). Id. Generally, a legislative regulation establishes “a substantive rule creating a controlling standard of conduct.”

Legislative regulation - validity - A legislative regulation is valid if adopted pursuant to delegated legislative power, in accordance with the appropriate administrative procedure, and is reasonable. By comparison, an interpretive regulation merely construes and does not expand upon the terms of a statute.

Interpretive regulation - validity - An interpretive regulation is valid if it “genuinely track[s] the meaning of the underlying statute.” Id. If the interpretive regulation “is unwise or violative of legislative intent, courts disregard [it].” The test for determining the validity of an interpretive regulation is also applied to a regulation that establishes a substantive rule in two other circumstances: if the regulation was adopted by a Commonwealth agency without lawmaking power or if it was adopted without meeting the appropriate procedural requirements.

Scope of DOLI power and authority to adopt regulations
Under Section 201 of the Act, 43 P.S. § 761(a), the Department shall have power and authority to adopt, amend, and rescind such rules and regulations . . . as it deems necessary or suitable. Such rules and regulations shall not be inconsistent with the provisions of [the Act.]

The court rejected the school district’s argument that the Section 201(a) limitation regarding regulations inconsistent with the statute should be given the broad interpretation that the Department may not adopt any legislative regulations. Such an interpretation "leads to the absurd result that enabling statutes that do not contain the limiting language permit the adoption of regulations inconsistent with those statutes. Clearly the legislature would not authorize agencies to adopt binding regulations inconsistent with the applicable enabling statutes. . . .Indeed, all regulations, whether legislative or interpretive “must be consistent with the statute under which they were promulgated.” The sec. 201(a) limitation merely codifies this requirement by stating that only Department regulations consistent with the provisions of the Act are valid.

The court also rejected the school district’s argument that the complex nature and “detailed statutory scheme” of the UC Act suggests that the Department’s regulatory authority is limited. Indeed, the Act specifically grants the Department “power and authority to adopt, amend, and rescind such rules and regulations . . . as it deems necessary or suitable.” 43 P.S. § 761(a). If the complex nature of a statute (the Act) were a criterion for denying a Commonwealth agency (the Department) the power to promulgate legislative regulations, then the intent of the legislature that the Department adopt regulations “as it deems necessary or suitable,” as expressed by the plain language of the Act, would be thwarted. Indeed, the logical consequence of the School District’s argument is that the Department would not be able to adopt any regulations because the legislature had spoken on every issue. The rules of statutory interpretation do not permit such a conclusion.

The court also refused to consider the complexity of a statutory scheme as an element in determining the ambit of an agency’s statutory power and authority to adopt regulations where the language of the statute is clear and unambiguous in its direction that the agency may adopt such regulations.

What is a "reasonable regulation"?
In deciding whether an agency action, such as promulgation of a legislative regulation, is reasonable, a court is "not at liberty to substitute its own discretion for that of administrative officers who have kept within the bounds of their administrative powers. To show that these have been exceeded in the field of action involved, it is not enough that [the agency’s regulation] shall appear to be unwise or burdensome or inferior to another. Error or unwisdom is not equivalent to abuse. What has been ordered must appear to be so entirely at odds with fundamental principles as to be the expression of a whim rather than an exercise of judgment." Similarly, the Court has held that “appellate courts must accord deference to the agency and may only overturn an agency determination if the agency acted in bad faith or the regulations constituted a manifest or flagrant abuse of discretion or a purely arbitrary execution of the agency's duties or functions.”

The regulation in question was reasonable and consistent with the UC Law as a whole and corrected an "inequity" in the UC Law
The court held that the regulation was not inconsistent with the language of the state and that it was "reasonable, because it is not so at odds with [the statute's] “fundamental principles as to be the expression of a whim rather than an exercise of judgment.”

According to the school district, the regulation conflict with the legislative intent of sec. 402.1(1) because the purpose of that section is “to eliminate the payment of benefits to school employees during summer. However, the court found that that "view fails to acknowledge that sec. 402.1(1), when read in its entirety and in the context of the Unemployment Compensation Act, offers a limited right to avoid paying unemployment benefits." [emphasis added]

It is true that "intent of the legislature in passing sec. 402.1 was to eliminate the payment of benefits to school employees during summer months and other regularly scheduled vacations, on the rationale that such employees are able to anticipate and prepare for these nonworking periods. The law thus recognizes that these employees are not truly unemployed or suffering from economic insecurity during scheduled recesses."

However, this "rationale breaks down with respect to school employees like the claimant. The decrease in her income was not caused simply by the summer vacation but by the school district’s decision to offer her a position with fewer hours, salary, and benefits. The regulation addresses the inequitable gap created for school employees like claimant when her position disappears during the second academic year and her only option is to be unemployed or accept a position with less or possibly no compensation."

The Department’s regulation thus "remedies the inequity pursuant to the stated purposes of the Unemployment Compensation Act. The first stated goal is humanitarian: to provide “[s]ecurity against unemployment and the spread of indigency.” 43 P.S. § 752 (Declaration of public policy). The Regulation extends unemployment benefits to persons who have suffered a loss of income." [emphasis added]

The Act’s second stated and equally important goal is to cooperate fully with USDOL so as “to secure to this Commonwealth and its citizens all advantages available under the provisions of the Social Security Act that relate to unemployment compensation.” 43 P.S. § 767(a)(1). As the Pa. Bulletin publication recounts, USDOL notified the Commonwealth of its failure to conform to federal law in its interpretation of “reasonable assurances.” The Department’s regulation adjusted Pennsylvania unemployment law to conform to USDOL’s requirement and, as a result, met its statutory mandate. Placed into context, the regulation is clearly consonant with Section 402.1(1) and the rest of the Act so it is therefore reasonable.

contracts - student handbook

Tran v. State System of Higher Eduction - Cmwlth. Court - December 2, 2009

http://origin-www.courts.state.pa.us/OpPosting/Cwealth/out/1912CD08_12-2-09.pdf

Nursing student at state university sued school for improperly dismissing her from the program, in violation of the terms set out in the student handbook.

The court held that the handbook "does not constitute a bilateral contract by which the University was bound. The cases relied upon by Petitioner...to establish the existence of such a contract involved private college students pursuing contract damages against private colleges and universities for averred violations of the disciplinary procedures in the respective student handbooks. Pennsylvania Courts have held consistently that the relationship between a student and a privately funded college is “strictly contractual in nature.” Reardon, 926 A.2d at 480; see also Barker v. Bryn Mawr College, 278 Pa. 121, 122, 122 A. 220, 221 (1923); Psi Upsilon of Philadelphia v. University of Pennsylvania, 591 A.2d 755, 758 (Pa. Super. 1991); Boehm v. University of Pennsylvania School of Veterinary 7 Medicine, 573 A.2d 575, 579 (Pa. Super. 1990); Morein v. Drexel University, 44 Pa. D. & C. 4th 13 (2000); Smith v. Gettysburg College, 22 Pa. D. & C. 3d 607 (1982); and Eter v. College Misericordia, 28 Pa. D. & C. 3d 402 (1982). (emphasis in original).

Commonwealth Court "has declined to construe the student handbook of a public university as a contract between the public university and the student. Crabtree v. California University of Pennsylvania, 606 A.2d 1239, 1240 n. 3 (Pa. Cmwlth. 1990). Accordingly, because the University is a public entity, we conclude that the Handbook did not constitute a contract between Petitioner and the University. Rather, the Handbook set forth the administrative procedures and remedies available and, if the University failed to follow those procedures and remedies, Petitioner could have, and should have, appealed the University’s determinations.

Query: What is the basis for distinguishing private v. public here?

execution - entireties property

State Farm v. Lincow - ED Pa. - December 1, 2009 (decision of magistrate judge)

http://www.paed.uscourts.gov/documents/opinions/09D1420P.pdf

The property at issue -- season tickets to the Philadelphia Eagles -- is not the sort that our clients are likely to have, but the principles involved are very important and relevant.

The creditor got a judgment against husband and began execution on Eagles season tickets. The judgment debtor moved for a determination of ownership, claiming that the tickets were entireties property belong to both him and his wife.

Under Pennsylvania law, a judgment creditor may execute on property held by husband and wife as tenants by the entireties only if both spouses are judgment debtors. Klebach v. Mellon Bank, N.A., 565 A.2d 448, 450 (Pa. Super. Ct. 1989). If only one spouse is the judgment debtor, entireties property is immune from process, execution, or sale. The judgment in this case was just against the husband and not the wife.
The issue of ownership of is a matter of contract interpretation. Under Pennsylvania law, when the intention of the parties is clear in the written contract, there is no need to resort to extrinsic evidence. Instead, the meaning of a clear and unequivocal written contract “must be determined by its contents alone.” Bohler-Uddeholm America, Inc. v. Ellwood Group, Inc., 247 F.3d 79, 92 (3d Cir. 2001), cert. denied, 534 U.S. 1162 (2002).

However, where the contract terms are ambiguous and susceptible to more than one reasonable interpretation, the court may receive extrinsic parol evidence to resolve the ambiguity. See id at 93. A contract “will be found ambiguous if, and only if, it is reasonably or fairly susceptible of different constructions and is capable of being understood in more senses than one and is obscure in meaning through indefiniteness of expression or has a double meaning.” Duquesne Light Co. v. Westinghouse Elec. Corp., 66 F.3d 604, 614 (3d Cir. 1995).

In this case, only the husband signed the agreement. However, he testified that was because there was only one signature line. In addition, the tickets were paid for in the past from a joint account, and both husband and wife are listed as ticket owners on several documents. The court thus found that the agreements are ambiguous concerning ownership, and the court considered parol evidence to resolve the ambiguities. That evidence strongly favored a finding that the property was held by the entireties.

In the alternative, even if the court found that the terms of the agreements were not ambiguous, and that the husband/signatory of the contracts was the sole owner, "this is not dispositive because under Pennsylvania law the intent of the husband and wife to hold property by the entireties should be given effect if the evidence supports that fact. See Plastipak Packaging, Inc. v. DePasquale, 937 A.2d 1106, 1110 (Pa. Super. Ct. 2007) (“[I]ntention is the cardinal and controlling element, and if intention that the husband and wife shall take as such, i.e., by entireties, sufficiently appears, it will be given effect.”) (citation omitted), appeal denied, 956 A.2d 436 (Pa. 2008) (Table).

In the absence of a writing executed by both spouses, property titled in one spouse’s name alone, but treated by both spouses during the marriage as property owned by the entireties, constitutes jointly held property. See Hengst v. Hengst, 420 A.2d 370, 370 (Pa. 1980) (applying this principle to a savings plan titled in husband’s name alone; property owned by the entireties where both spouses treated it as jointly held property during the marriage). See also In re Estate of Holmes, 200 A.2d 745, 747-48 (Pa. 1964) (shares of stock purchased by the husband with his own funds, but the certificates for which were issued in the name of the husband and wife, created a gift and an estate by the entireties).

Here, despite only the signature of the husband on the agreements, it is clear that wife and husband treated the Eagles tickets throughout their marriage as entireties property, and intended them to be held as such. This intent is confirmed by the listing of both their names on two separate agreements. Thus, under Pennsylvania law, the property must be considered as being held as tenants by the entireties. As entireties property, the Eagles Tickets, and license associated therewith, are exempt from execution.

UC - reasonable assurance - economic equivalency

Slippery Rock School District v. UCBR - Pa. Supreme Court - November 30, 2009

http://origin-www.courts.state.pa.us/OpPosting/Supreme/out/J-72-2009mo.pdf


Former long-term substitute teacher who was offered only day-to-day position in the ensuing school year did not have "reasonable assurance" of continuing employment and was thus eligible for UC benefits when laid off from the long-term position.


Section 402.1(1) of the UC Law provides that teachers and other school employees are not entitled to receive unemployment benefits during the summer recess if they have “reasonable assurance” of returning to their job in the next academic year, 43 P.S. § 802.1(1)


The decision was based on 34 Pa. Code § 65.161, which was held to be a reasonable, valid and binding regulation, which was properly adopted, within the Department's powers, and consistent with the terms of the UC Law, sec. 402.1, 43 P.S. § 802.1(1), even though it concededly created a "new standard of conduct" -- economic equivalency.


Under sec. 65.161, there is no reasonable assurance where the "economic terms and conditions of the employment offered to the individual for the second academic period are. . . substantially less than the terms and conditions of the individual’s employment in the first academic period.... (c) For the purposes of subsection (a), economic terms and conditions of employment include wages, benefits and hours of work. "The element of 'reasonable assurance' addressed by the Regulation is known as economic equivalency."


"The Regulation addresses the inequitable gap created for school employees like [the claimant] when her position disappears during the second academic year and her only option is to be unemployed or accept a position with less or possibly no compensation.


The Department’s Regulation also remedies the inequity pursuant to the stated purposes of the UC Act. The first stated goal is humanitarian: to provide “[s]ecurity against unemployment and the spread of indigency.” 43 P.S. § 752 (Declaration of public policy). The Regulation extends unemployment benefits to persons who have suffered a loss of income."


The Act’s second stated and equally important goal is to cooperate fully with USDOL so as “to secure to this Commonwealth and its citizens all advantages available under the provisions of the Social Security Act that relate to unemployment compensation.” 43 P.S. § 767(a)(1). As the Pa. Bulletin publication recounts, USDOL notified the Commonwealth of its failure to conform to federal law in its interpretation of “reasonable assurances.” 33 Pa. Bull. 25 (January 4, 2003). The department’s regulation adjusted Pennsylvania unemployment law to conform to USDOL’s requirement and, as a result, met its statutory mandate. Placed into context, the Regulation is clearly consonant with Section 402.1(1) and the rest of the Act so it is therefore reasonable. The court held that the regulation, 34 Pa. Code § 65.151 was a "valid exercise of the Department’s power to promulgate legislative regulations."