abuse - expungment - late appeal - request for hearing - right to hearing - due process

J.P. v. DHS – Cmwlth. Court – September 12, 2017

http://www.pacourts.us/assets/opinions/Commonwealth/out/1602CD16_9-12-17.pdf?cb=1

Alleged perpetrator (“petitioner”) of abuse responded within appropriate time to initial notice of indicated report of abuse in 2000 by writing asking the the indicated report be “destroyed or amended...” based on errors in the report and explained that “if necessary, I would like to appeal or dismiss this claim.  If a hearing is necessary, I would like one.”

DHS sent petitioner two further letters in 2000 and 2001 as part of a “two-step appeal process.”  Petitioner did not respond to either of these letters, which he said that he had never received.  He continued to work – as a teacher – for fifteen (15) years – until 2016, when his school directed him to renew his background check, at which time he discovered that he was listed on the ChildLine Registry as an abuser.  He immediately asked for a hearing, which request was denied by DHS as untimely.

The Court reversed, holding the petitioner’s response to the initial notice of indicated report was a “clear request for a hearing” to which he had an “absolute right” as a matter of due process under the Pennsylvania Constitutions.

Excerpts from the opinion

Reputation is a “fundamental right under the Pennsylvania Constitution”

Placement on a registry for alleged child abuse causes damage to the alleged abuser, primarily in the form of reputational harm and employment repercussions. Reputation is expressly protected in Sections 1 and 11 of Article I of the Pennsylvania Constitution. 8 In the Commonwealth, reputation is “a fundamental interest which cannot be abridged without compliance with constitutional standards of due process and equal protection.” R. v. Dep’t of Pub. Welfare, 636 A.2d 142, 149 (Pa. 1994); see also In re J.B., 107 A.3d 1, 16 (Pa. 2014) (“[The Pennsylvania Supreme Court] has recognized that the right to reputation, although absent from the federal constitution, is a fundamental right under the Pennsylvania Constitution”). “In Pennsylvania, therefore, reputational harm alone is an affront to one’s constitutional rights.” D.C. v. Dep’t of Human Serv., 150 A.3d 558, 566 (Pa. Cmwlth. 2016).

Due process

Because an indicated report goes into the registry on the basis of the investigation alone, the alleged perpetrator suffers a loss to reputation and possibly employment, all without a hearing. Id. at 564. We expressed concern that the lack of a pre-deprivation hearing raises a serious due process question. Id.   In D.C., we also closely examined the Missouri Supreme Court’s decision in Jamison v. State of Missouri, Department of Social Services, 218 S.W.3d 399 (Mo. 2007). There, the Missouri Supreme Court declared Missouri’s version of the Child Protective Services Law unconstitutional for that exact reason—because the Missouri law did not provide for a pre-deprivation hearing.

Unlike Missouri, Pennsylvania has not yet answered the question of whether a pre-deprivation hearing is necessary to satisfy due process. Pennsylvania decisions have expressed serious misgivings about the Commonwealth’s statutory scheme. Senior Judge Friedman expressed her concern in the following way:

It shocks my conscience that the [Child Protective Services] Law would allow the investigating caseworker to render a de facto adjudication that is adverse to an individual’s reputation without an independent adjudicator having had the opportunity to consider the investigator’s evidence of child abuse in accordance with established procedures of due process. This is particularly so because unless, or until, the alleged abuser timely requests an expunction hearing, the names of the falsely accused may nevertheless be released to physicians, child advocates, courts, the General Assembly, the Attorney General, federal officials, county officials, law enforcement officials, the district attorney and others. Thus, by the time [the Department] orders the expunction of an indicated report, a person’s reputation already may be tarnished erroneously.

K.J. v. DPW, 767 A.2d 609, 616 n.9 (Pa. Cmwlth.) (Friedman, J., dissenting) (emphasis in original), appeal denied, 788 A.2d 381 (Pa. 2001). More recently, in G.V. v. DPW, 91 A.3d 667 (Pa. 2014), Justice Saylor, now Chief Justice, concluded his concurrence by noting that “the inquiry into whether the Pennsylvania statute reflects adequate process remains seriously in question,” adding that the current system “is in tension with the constitutional 12 preference for pre-deprivation process.” G.V., 91 A.3d at 674 n.1 (Saylor, J., concurring).   In determining the sufficiency of the procedure, the Supreme Court’s decision in Mathews v. Eldridge, 424 U.S. 319 (1976), instructs that three factors must be considered: First, the private interest that will be affected by the official action; second, the risk of an erroneous deprivation of such interest through the procedures used, and the probable value, if any, of additional or substitute procedural safeguards; and finally, the Government’s interest, including the function involved and the fiscal and administrative burdens that the additional or substitute procedural requirement would entail. Mathews, 424 U.S. at 335. The Supreme Court has held “that some form of hearing is required before an individual is finally deprived of a [protected] interest” because “the right to be heard before being condemned to suffer grievous loss of any kind . . . is a principle basic to our society.” Id. at 333 (emphasis added) (internal quotation omitted).

Petitioner was entitled to adequate notice and some form of a hearing. Initially, we note that the June 12, 2000 letter, notifying Petitioner of the indicated report, used the exact wording that this Court criticized in the past.  In C.S. v. DPW, 879 A.2d 1274 (Pa. Cmwlth. 2005), another challenge by an alleged perpetrator of child abuse, the notice from the Department provided: “If this request is denied, perpetrators may have a right to a hearing.” C.S., 879 A.2d at 1277 (emphasis omitted). We held that the use of the word “may” rendered the notice equivocal, thus constituting a breakdown of administrative procedure that justified nunc pro tunc relief. Id. at 1280. Here, by using the same wording used in C.S., the notice in the June 12, 2000 letter is equally equivocal. Additionally, the June 12, 2000 letter does not appear to give any indication that Petitioner would be listed on the ChildLine Registry.  The letter simply provides that the Department will maintain a file on petitioner. Petitioner does not, however, argue that the June 12, 2000 letter was equivocal, so as to justify nunc pro tunc relief, or inadequate, so as to violate due process.   Accordingly, because we need not determine whether the June 12, 2000 letter provided “adequate notice” in terms of due process, we proceed to the question of whether Petitioner was afforded “some form of hearing.” See Mathews, 424 U.S. at 333.

We need not apply the Mathews test to determine the constitutionality of Pennsylvania’s current process under the Child Protective Services Law— providing a post-deprivation rather than a pre-deprivation hearing—because here, the Department violated Petitioner’s right to due process by not providing any form of a hearing. In his July 25, 2000 letter to the Department, Petitioner requested the indicated report be “destroyed or amended” and added, “[i]f a hearing is necessary, I would like one.”  Though conditionally stated, this was nonetheless a clear request for a hearing. The administrative law judge’s position that “it is not necessary to have a hearing to amend or destroy an indicated report,” is unpersuasive, because Petitioner is not speaking about the procedure as it applies to all perpetrators, generally, but rather as it applies to him. Petitioner begins the letter by asking for the indicated report to be expunged. The condition he places on the hearing request is, essentially, in the event that the indicated report is not expunged then he would like a hearing. More importantly, an ambiguous statement by a named perpetrator is a very weak ground on which to base denial of a hearing to which Petitioner had “an absolute right.” C.S., 879 A.2d at 1280. Petitioner requested a hearing, but he was never afforded one. The Department should have provided Petitioner some form of a hearing, and its failure to do so resulted in Petitioner’s name being placed on the ChildLine Registry for over 17 years.

FLSA - Uber driver - "employee" - "employer"

Razak v. Uber Technologies – ED Pa. – Sept. 13, 2017

https://www.paed.uscourts.gov/documents/opinions/17D0649P.pdf

If apps be the food of the future, log on! With apologies to Shakespeare––the opening line of Twelfth Night, “If music be the food of love, play on” providing inspiration––app based ride-sharing is a disruptive business model in search of a legal theory.1

The courts that have dealt with litigation arising out of ride-sharing technology have struggled to find an appropriate legal doctrine to fit these novel commercial relationships. For this case, one challenge is determining what type of activity includes a driver being “on call” for an assignment, and whether this status is “compensable.” Plaintiffs Ali Razak (“Razak”), Kenan Sabani (“Sabani”), and Khaldoun Cherdoud (“Cherdoud” and, together with Razak and Sabani, “Plaintiffs”) have brought individual and representative claims against Gegen, LLC and its sole member, Uber Technologies, Inc.  for violations of the federal minimum wage and overtime requirements under the Fair Labor Standards Act, 29 § U.S.C. 201 et seq. (“FLSA”), and parallel Pennsylvania state wage and labor laws.

Before the Court is Uber’s Motion for Partial Summary Judgment on the limited question of whether—assuming, for purposes of this Motion only, that Plaintiffs qualify as “employees” and Uber as an “employer” under the FLSA2 —the time they spent Online the Uber App is compensable work time under the FLSA, and by extension, the PMWA.

contracts - release of worker's comp. claim not a waiver of FMLA claims

Zuber v. Boscov’s – 3d Cir. – September 12, 2017

http://www2.ca3.uscourts.gov/opinarch/163217p.pdf

Held: Compomise & Release that employee signed to settle a worker’s comp. claim did not act as a waiver of his Family and Medical Leave Act cause of action.  “A long line of Pennsylvania cases has held that a release covers only those matters which may be fairly said to have been within the contemplation of the parties when the release was given.” Restifo v. McDonald, 230 A.2d 199, 201 (Pa. 1967).   The terms of the C&R make it clear that the release in that document was not meant to apply cover the FMLA or common law claims.

corporations - counsel - appeal of MDJ judgment by a non-attorney is a legal nullity

Iannoco v. Fuelin Fine Auto Sales – 59 Northampton 689

https://www.northamptoncounty.org/DPTCRTADMN/Court%20Opinions%20Files/C-0048-CV-2015-7059.pdf#search=%22auto%20sales%22

Appeal from MDJ money judgment filed by a corporate agent or office is a ineffective, a legal “nullity,” since a corporation can act in court only through counsel.   Petition to strike appeal granted.

In Pennsylvania, “a corporation may appear and be represented in our courts only by an attorney duly admitted to practice” law. Walacavage v. Excell 2000, Inc., 480 A.2d 281, 285 (Pa. Super. 1984). There are only two exceptions to this rule, and neither is applicable here. First, a corporation does not require an attorney if permitted to represent itself by rule or statute. Id. at 284. There are no such rules or statutes applicable here. n. 2

When a corporation files an appeal to the Court of Common Pleas without an attorney, the filing is a nullity, rendering the Court without jurisdiction to hear it and requiring the Court to strike the appeal. See Spirit of the Avenger Ministries v. Commw., 767 A.2d 1130, 1130-31 (Pa. Commw. 2001); see also McCain v. Curione, 527 A.2d 591, 594 (Pa. Commw. 1987) (agreeing with two Courts of Common Pleas that “proceedings commenced by persons unauthorized to practice law are a nullity”).

n. 2

While Pa.R.C.P.M.D.J. No. 207(A)(3) authorizes a corporation to be represented by an officer, employee, or authorized agent of the corporation in magisterial district court proceedings, there is no Pennsylvania Rule of Civil Procedure that authorizes the same in an appeal from such a proceeding or in a civil action before the Court of Common Pleas. Further, while Plaintiff argues that the holding in Harkness v. Unemployment Compensation Board of Review, 920 A.2d 162 (Pa. 2007) carved out an applicable exception to the general rule, the Court disagrees. In that case, the Pennsylvania Supreme Court held that a nonattorney representative is permitted to represent a corporate employer in unemployment compensation proceedings before a referee for reasons peculiar to those proceedings. Id. at 168-69. None of the reasons cited by the court in Harkness apply with regard to a civil action before the Court of Common Pleas

UC - vol. quit - follow-the-spouse - maintenance of family unit alone not good cause

Rodriguez v. UCBR – Cmwlth. Court – September 7, 2017 (2-1 decision)

http://www.pacourts.us/assets/opinions/Commonwealth/out/903CD16_9-7-17.pdf?cb=1

Held:  A desire to maintain the family unit, alone, is insufficient to establish a necessary and compelling reason to leave employment. Schecter v. UCBR, 491 A.2d 938, 941 (Pa. Cmwlth. 1985).

Claimant and children moved from Pa. to Florida to join her husband, who had been awarded a full-scholarship to a theological school, conditioned on his move to Florida with his entire family.  Husband testified that “there was a good prospect of full-time employment as a minister following the completion of the ministerial program” and that he would receive a  bachelor’s degree when he finished.   Husband was “ able to maintain some level of employment as a truck driver in Pa. but was unable to obtain a permanent position.   His job possibilities were limited by a past criminal conviction.  His relocation to Florida was not done in order to accept an offer of employment in a highly-specialized field with a limited job market or because his job was going to be eliminated.   He had no firm job offer contingent on his completing the schooling in Florida.

“Under the “follow-the-spouse” doctrine, a claimant’s burden is two-fold. Wheeler v. UCBR, 450 A.2d 775, 778 (Pa. Cmwlth. 1982). First, the claimant must establish that the move created insurmountable commuting problems or that maintaining two residences would result in economic hardship. Glen Mills, 665 A.2d at 564. Under the second inquiry, the claimant must also demonstrate that circumstances beyond the control of the claimant’s spouse caused the necessity to relocate, the decision was reasonable and made in good faith, and that the relocation was not a result of the spouse’s personal preferences. Pennsylvania Gaming Control Bd., 47 A.3d at 1267; Id.

The court found that claimant satisfied the first prong of this test but not the second.  There was an “insurmountable commuting problem for Claimant with regard to her Pennsylvania job. See Glen Mills, 665 A.2d at 564 (holding that it is obviously unreasonable to commute five hours round trip each day). Accordingly, Claimant sustained her burden of demonstrating an insurmountable commuting problem and, therefore, satisfied the first prong of the “follow-the-spouse” doctrine. In order to satisfy the second prong of the analysis, a claimant must demonstrate that circumstances beyond her spouse’s control caused the necessity to relocate, that the decision was reasonable and made in good faith, and that the relocation was not a result of the spouse’s personal preferences. We note that the desire to maintain the family unit, alone, is insufficient to establish a necessary and compelling reason to leave employment. Schecter v. Unemployment Comp. Bd. of Review, 491 A.2d 938, 941 (Pa. Cmwlth. 1985). On the other hand, a claimant may meet her burden by demonstrating that the relocating spouse’s position has been eliminated. Other examples of evidence offered to meet this burden have included a limited job market due to the highly specialized nature of a spouse’s occupation, 7 a spouse’s military orders,8 a spouse’s medical needs, 9 or evidence that a spouse’s job will be eliminated.10

7 Glen Mills, 665 A.2d at 564. 8 Pennsylvania Gaming Control Bd., 47 A.3d at 1270-71. 9 Steck v. UCBR, 467 A.2d 1378, 1380 (Pa. Cmwlth. 1983). 10 See Mechanicsburg Area Sch. Dist. v. UCBR, 551 A.2d 401, 402-03 (Pa. Cmwlth. 1988)

The “objective of the Law . . . is to ensure that employees who become unemployed involuntarily are provided with some semblance of economic security.” Hamot Medical Center v. UCBR, 645 A.2d 466, 469 (Pa. Cmwlth. 1994). Thus, it is not the purpose of unemployment compensation to be a vehicle through which a family may finance a voluntary change of career or a desire for a spouse to obtain additional education. If husband had had a firm offer of employment when he completed the schooling, our decision may have been different.”

Dissent

We have long held that the Unemployment Compensation Law“was intended to be remedial legislation which is to be liberally and broadly construed…” Steck v. UCBR, 467 A.2d 1378, 1380 (Pa. Cmwlth. 1983) (citing Kleban v. UCBR, 459 A.2d 53, 55 (Pa. Cmwlth. 1983)).

In the “follow the spouse” context, we have recognized the unique nature of the family unit in situations where compelling reasons motivated the initial move in the first place:

While preservation of the family unit does not, in and of itself, give rise to necessitous and compelling reason under Section 402(b), [] we are not indifferent to its social desirability. Moreover, in the absence of statutory language mandating such application, we are disinclined to interpret the Law in a way which tends to be disruptive to family unity. In this case, we believe it is sufficient that the claimant has demonstrated a good faith desire to keep her family together, that her interest in preserving the family unit was irreconcilable with maintenance of her job due to the distance between her's [sic] and her husband's places of employment, and that her husband's decision to relocate was motivated by compelling factors. Stevens v. UCBR, 473 A.2d 254, 257 (Pa. Cmwlth. 1984) (emphasis added).

In the present case, the Majority has shown no such “disinclin[ation],” despite no legislative direction otherwise. Coupled with the “compelling factors” before us (equally as compelling as those in Stevens), the Majority’s interpretation and application of the “follow the spouse” doctrine is erroneous and, for this family, quite harmful. 2 As there is no indication that this is consistent with legislative intent, I am compelled to dissent.

consumer protection - UTPCPL - representation - justifiable reliance

Zajick v. Cutler Group – Superior Court – August 31, 2017

http://www.pacourts.us/assets/opinions/Superior/out/Opinion%20-%20Affirmed%20-%2010322921423277537.pdf?cb=1

There was “no evidence” that homeowner “justifiably relied on representations” from builder regarding construction on the specific home or alleged defective stucco, “as is required to bring a privarte cause of action under Pennsylvania’s Unfair Trade Practices and Consumer Protection Law (“UTPCPL”), 73 P.S. §201-2, et seq.

Plaintiff homeowner never had any communication with builder about the home.   Homeowner claims were based solely in reliance  on builder’s “reputation and general statements from a sales rep. about homes in the same development.  Builder constructed home in 2003, sold it to initial buyer, who sold it to Plaintiff.

In order to bring a private cause of action under the UTPCPL, “a plaintiff must show that he justifiably relied on the defendant's wrongful conduct or representation and that he suffered harm as a result of that reliance.” Yocca v. Pittsburgh Steelers Sports, Inc., 854 A.2d 425, 438 (Pa. 2004) (emphasis added).   Strict technical privity is not required to bring a cause of action under the UTPCPL, and it was not a factor in this case. Valley Forge Towers Smith Condominium v. Ron-Ike Foam Insulators, Inc., 574 A.2d 641, 647 (Pa. Super. 1990).   Rather, the trial court granted summary judgment after concluding that Appellant “failed to establish any representations made by [builder] that rise to the level of representations upon which reasonable justifiable reliance is foreseeable.”

In Adams v. Hellings Builders, Inc., 146 A.3d 795, 801 (Pa. Super. 2016), the court held that strict technical privity is not required to assert a cause of action under the UTPCPL, rather the “focus is on whether reliance on alleged misrepresentations was specially forseeable.”  In that case, the home did not comply with the stucco standards which were set out in the specific written contract between builder and initial homeowner, who then sold to plaintiffs.  Plaintiff there alleged that the sales agreement between the builder and the initial purchasers represented that the home would include a three-coat stucco system according to International Residential Code Standards.   However, upon inspection by plaintiff’s expert, the stucco system did not comply with those standards.   The plaintiffs alleged that they had justifiably relied on this sales agreement when they decided to purchase the home.   The court determined that those facts were sufficient upport a private cause of action under the UTPCPL, because the complaint alleged that the builder made representations about the home and stucco system in the sales agreement, and it was foreseeable that plaintiffs would justifiably rely on those representations. Adams, supra at 801-802.

In contrast, plaintiff here did not produce any evidence that builder made representations about the specific home at issue or the alleged defective stucco to her or the previous purchasers. In fact, hhomeowner conceded “she never had any communication with builder regarding this home prior to purchasing it from the initial buyer.  Rather,, plaintiff here

relied on (1) the “reputation” of the builder as an “experienced, reliable, reputable builder of custom homes[;]” (2) the experience homeowner nt had in purchasing and inhabiting her previous home, which was built by same builder and did not exhibit latent construction defects; and (3) “the representations of builder’s sales representative as to the construction and quality of the homes in the the same development as the home at issue, when homeowner was in the process of purchasing her previous home directly from Cutler and toured homes there.

The court held that  “there is no legal basis to allow [homeowner’s] claim to move forward based solely on her reliance on builder’s  reputation and general statements from a sales representatives about homes in the same development. Since homeowner failed to establish that builder made any representations about her specific home or the alleged defective stucco, the trial court properly found that she failed as a matter of law to present evidence that she “justifiably relied” on “representations” of builder.

foreclosure - mitigation - Regulation X - lack of specification of documents homeowner failed to supply

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Bank of New York Mellon v. Brooks, Jr. – Superior Court – August 28, 2017

MAJORITY http://www.pacourts.us/assets/opinions/Superior/out/Opinion%20-%20Reversed-Remanded%20-%2010322471723020898.pdf?cb=1

CONCURRING http://www.pacourts.us/assets/opinions/Superior/out/Concurring%20Opinion%20-%20Reversed-Remanded%20-%2010322471723020923.pdf?cb=1

Homeowner raised sufficient questions about mortgage servicer’s compliance with loss-mitigation requirements of “Mortgage Servicing Rules under the Real Estate Settlement Procedures Act (Regulation X),”  codified at 12 C.F.R. § 1024.30 et seq., as to preclude summary judgment for servicer.    

The servicer rejected  homeowner’s application  “because the required documentation needed to proceed was not received.”   The servicer failed, however, to identify which documents homeowner neglected to provide.  Trial court reversed and case remanded.

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

 “Mortgage Servicing Rules under the Real Estate Settlement Procedures Act (Regulation X),” are codified at 12 C.F.R. § 1024.30 et seq. “Regulation X prohibits, among other things, a loan servicer from foreclosing on a property in certain circumstances if the borrower has submitted a completed loan modification, or loss mitigation, application.” Miller v. Bank of New York Mellon, 228 F.Supp.3d 1287, 1290 (M.D.Fl. 2017)

 Regulation X requires servicers2 to follow specified loss mitigation procedures for a mortgage loan secured by a borrower’s principal residence. A “loss mitigation application” is “an oral or written request for a loss mitigation option that is accompanied by any information required by a servicer for a loss mitigation option.” 12 C.F.R. § 1024.31. A “loss mitigation option means an alternative to foreclosure offered by the owner or assignee of a mortgage loan that is made available through the servicer to the borrower.” Id.

 If a borrower submits an application for a loss mitigation option more than forty-five days prior to a foreclosure sale, the servicer is generally required to acknowledge the receipt of the application in writing within five days and notify the borrower whether the application is complete and, if not, inform the borrower of the additional documents and information needed to complete the application. See id. at § 1024.41(b)(1), (b)(2)(i) and (ii). The notice shall also state a reasonable date by which the borrower should submit the documents and information. Id. at § 1024.41(b)(2)(ii).  The servicer must exercise reasonable diligence in obtaining documents and information to complete the application. Id. at § 1024.41(b)(i).

 If a borrower submits all the missing documents and information as stated in the notice, or if no additional information is requested, the application shall be considered facially complete for purposes of subsections 1024.41(d), (e), (f)(2), (g) and (h). See id. at § 1024.41(c)(2)(iv).  If the servicer later discovers additional information or corrections are required to complete the application, the servicer must promptly request the missing information or corrected documents and treat the application as complete until the borrower has a reasonable opportunity to complete the application. Id.

 For a complete loss mitigation application received more than thirtyseven days before a foreclosure sale, the servicer is required to evaluate the borrower, within thirty days of receiving the complete application, for all loss mitigation options for which the borrower may be eligible in accordance with the investor’s eligibility rules. Id. at § 1024.41(c)(1)(i). The servicer must provide the borrower with a written decision, including an explanation of the reasons for denying the borrower for any loan modification option offered by an owner or assignee of a mortgage loan. Id. at § 1024.41(c)(1)(ii).

 If a borrower submits a complete application for a loss mitigation option after the foreclosure process has commenced but more than thirtyseven days before a foreclosure sale, a servicer may not move for a J-S84034-16 - 8 - foreclosure judgment or order of sale or conduct a foreclosure sale, until one of the following three conditions has been satisfied: (1) the servicer has sent the borrower a notice that the borrower is not eligible for any loss mitigation option, and the appeal process in paragraph (h) of this section is not applicable, the borrower has not requested an appeal within the applicable time period for requesting an appeal, or the borrower’s appeal has been denied; (2) the borrower rejects all loss mitigation options offered by the servicer; or (3) the borrower fails to perform under an agreement on a loss mitigation option. Id. at § 1024.41(g)(1)-(3).

 Here, construed in the light most favorable to Appellant, the party opposing summary judgment, a genuine issue of material fact exists as to whether Appellee violated Regulation X, thus precluding foreclosure on Appellant’s property.     The servicer rejected Appellant’s Application “because the required documentation needed to proceed was not received.”   The servicer failed, however, to identify which documents Appellant neglected to provide.

admin. law - appeal - client late for hearing - good cause

Plouffe v. DHS – Cmwlth. Court -  August 21, 2017 –unreported memorandum opinion*

http://www.pacourts.us/assets/opinions/Commonwealth/out/1001CD16_8-21-17.pdf?cb=1

Appellant, an MA recipient, was 9 minutes late for his appeal hearing, due to his medical condition and his having fallen on the way to the hearing.   HDS conceded that claimant had good cause for delay and that a remand hearing on the merits was appropriate.

The Department does not dispute Client’s right to a hearing. Indeed, a claimant has a “right to appeal and have a fair hearing” when “applying for or receiving a money payment, medical assistance, food stamps or services [from the Department].” 55 Pa. Code §275.1(a)(2).

An applicant has “the right to appeal from a Department action or failure to act and to have a hearing if he is dissatisfied with a decision refusing or discontinuing assistance in whole or in part.” Id. The Department’s regulation establishes that a case will be dismissed if the Client “fails to appear at the scheduled hearing without good cause….” 55 Pa. Code §275.4(e)(6)(iii)(A).

Good cause may be established by evidence of a non-negligent reason for failing to attend. Eat’N Park Hospitality Group, Inc. v. Unemployment Compensation Board of Review, 970 A.2d 492, 494 (Pa. Cmwlth. 2008).

Client’s assertion that he was nine minutes late for the hearing because of a fall is sufficient, if deemed credible, to establish good cause.

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*An unreported Commonwealth Court case may not be cited binding precedent but can be cited for its persuasive value.  See 210 Pa. Code § 69.414(b) and Pa. R.A.P.  3716

If the case is old, the link may have become stale and may not work, but you can use the case name, court, and date to find the opinion in another source (e.g., Westlaw, Lexis, Google Scholar)

custody - contempt - sanctions

N.A.M. v. M.P.W. – Superior Court – August 7, 2017

http://www.pacourts.us/assets/opinions/Superior/out/Opinion%20-%20Affirmed-Reversed-Remanded%20-%2010319938122523045.pdf?cb=1

Lower court erred in failing to impose sanctions on parent found in contempt of custody order, where record showed that parent had “continuously violated court orders for approximately ten years....[T]he trial court abused its discretion by declining to impose any sanction on Mother despite her flagrant contempt, which has been ongoing for ten years.”  Harcar v. Harcar 982 A.2d 1230 (Pa. Super. 2009).

attorney fees - foreclosure - "hire or pay someone else" - in-house counsel not covered

Enterprise Bank v. Frazier Famioy L.P. – Superior Court – August 8, 2017

http://www.pacourts.us/assets/opinions/Superior/out/Opinion%20-%20Affirmed%20-%2010320099422708039.pdf?cb=1

The following contract language did not authorize payment of attorney fees to the mortgage lender’s in-house counsel.

Attorneys’ Fees; Expenses. Borrower agrees to pay upon demand all of Lender’s costs and expenses, including Lender’s reasonable attorneys’ fees and Lender’s legal expenses, incurred in connection with the enforcement of this Agreement. Lender may hire or pay someone else to J-A05041-17 - 2 - help enforce this Agreement, and Borrower shall pay the costs and expenses of such enforcement.

disability - ALJ duty to develop record - right to full & fair hearing

Kane v. Berryhill – ED Pa. – July 17, 2017

https://www.paed.uscourts.gov/documents/opinions/17D0481P.pdf

Case remanded for “a proper evaluation of” the report of a physician who conducted a one-time mental health examination of claimant, who was absent from hearing.  ALJ refused to consider extensive mental health records that claimant’s counsel was able to procure after the hearing.

ALJ duty to develop facts

The Court of Appeals has repeatedly held that the ALJ has an affirmative obligation to assist the claimant in developing facts. Plummer v. Apfel, 186 F.3d 422, 433–34 (3d Cir. 1999); Taybron v. Harris, 667 F.2d 412, 414–15 (3d Cir. 1981); Kephart v. Richardson, 505 F.2d 1085, 10 1090 (3d Cir. 1974); Hess v. Sec’y of Health Educ. & Welfare, 497 F.2d 837, 840 (3d Cir. 1974). This affirmative obligation means that the ALJ’s duty to inquire is independent of plaintiff’s burden. Hippensteel v. Soc. Sec. Admin., 302 F. Supp. 2d 382, 390 (M.D. Pa. 2001).

Full and fair hearing

Prior to determining whether the ALJ’s decision is supported by substantial evidence, “the Court must first be satisfied that the plaintiff has had a full and fair hearing under the regulations of the Social Security Administration and in accordance with the beneficent purposes of the act.” Maniaci v. Apfel, 27 F. Supp. 2d 554, 557 (E.D. Pa. 1998), citing Echevarria v. Sec’y of Health and Human Servs., 685 F.2d 751, 755 (2d Cir.1982). Considering plaintiff’s objection, I find that he did not have a sufficient opportunity to testify at an administrative hearing regarding the severity of his impairments. At the initial hearing, counsel could not locate his client. Although the ALJ offered to hold a supplemental hearing if counsel could get in touch with plaintiff, the ALJ nonetheless proceeded with the initial hearing in plaintiff’s absence. During that hearing, plaintiff’s counsel explicitly noted that he believed plaintiff had undergone other psychological treatment since 2005, but, given his inability to contact his client, counsel did not have access to either those records or the medical records from plaintiff’s incarceration at the hearing. R. 42. Shortly after the hearing, the ALJ issued a request to show cause for plaintiff’s failure to appear, but, lacking a response from plaintiff, issued his decision deeming plaintiff “not disabled.” In that decision, the ALJ specifically cited to the lack of medical treatment as a basis for rejecting Dr. Orenstein’s opinion, despite knowing that plaintiff’s absence had an impact on the availability of treatment records. Plaintiff’s counsel finally located plaintiff a month and a half later and discovered he had been undergoing treatment at an inpatient psychiatric facility during the hearing. Counsel informed the ALJ and submitted extensive psychological and psychiatric records, many of which reflect a 11 mental disorder that may be as limiting as suggested by Dr. Orenstein. R. 721–94. Nonetheless, and despite counsel’s request, no supplemental hearing was held.

Case remanded to allow plaintiff to testify and for consideration of extensive further records.

UC - drug test - telephone hearing - submission of evidence prior to hearing

Bowers v. UCBR – Cmwlth. Court – April 4, 2017

Publication order     http://www.pacourts.us/assets/opinions/Commonwealth/out/798CD16ORD_6-20-17.pdf?cb=1   (June 20, 2017)

Opinion                     http://www.pacourts.us/assets/opinions/Commonwealth/out/798CD16_6-20-17.pdf?cb=2

Board decision denying benefits under sec. 402(e.1), 43 P.S. sec. 802(e.1) (failure to submit to/pass drug test) affirmed. 

Key facts:

            - the Board’s reliance on two reports of positive drug tests, which “were admitted into evidence at the Referee hearing without objection.” (emphasis added).

            - rejection of claimant’s proferred negative drug test, to which the employer did object and which were thus barred from consideration, because of claimant’s failure to submit the test in advance of the telephone hearing, as required by 34 Pa. Code 101.130(e), 101.131(h), and as directed in the Notice of Hearing.

Note that the cited regulation says that the “[w]hen any testimony will be given from or with the aid of a document not previously distributed to the parties by the tribunal, the party expecting to introduce the document shall deliver it to the tribunal, and the tribunal shall distribute it to each other party and, if known, counsel or authorized agent before or at the beginning of the testimony,” unless the tribunal requires that the documents be delivered “up to 5 days in advance of the hearing.” 

Query:  Did the employer produce its test reports in advance of the hearing?  That issue is apparently not addressed in the opinion.  If not, then were such reports admissible, even if the claimant failed to object to their admission?

bankruptcy - Ch. 13 - grace period to cure arrearage shortly after expiration of plan term

In re Klaas – 3d Cir. – June 1, 2017

http://www2.ca3.uscourts.gov/opinarch/153341p.pdf

The Bankruptcy Code sets certain limits on the amount of time that debtors may be required to remain in Chapter 13 proceedings and make payments on their debts. This case presents two questions of first impression among the Courts of Appeals:

            - whether bankruptcy courts have discretion to grant a brief grace period and discharge debtors who cure an arrearage in their payment plan shortly after the expiration of the plan term, and if so,

            - what factors are relevant for the bankruptcy court to consider when exercising that discretion.

Because we conclude the Bankruptcy Code does permit a bankruptcy court to grant such a grace period and the Bankruptcy Court did not abuse its discretion in granting one here, we will affirm the rulings of the District Court, which in turn affirmed the relevant order and judgment of the Bankruptcy Court.

UC - fault - overpayment - wrongful state of mind - finding on

Holmes v. UCBR – Cmwlth. Court – May 23, 2017 – unreported* memorandum decision

http://www.pacourts.us/assets/opinions/Commonwealth/out/1329CD16_5-24-17.pdf?cb=1

The Court reaffirmed its recent decision in Fugh v. UCBR, 153 A.3d 1169, 1176 (Pa. Cmwlth. 2017), holding that in order for an overpayment to be a fault OP, the claimant must have had a wrongful state of mind, about which the UCBR must make a specific finding.

The Fugh court held that finding that a “blameworthy act requires a showing of the actor’s state of mind, or mens rea” and “embodies … knowing recklessness or gross negligence.” We reasoned that a finding of fault “requires conduct ‘of such a degree or recurrence as to manifest culpability, wrongful intent, or evil design, or show an intentional and substantial disregard of the employer’s interest or of the employee’s duties and obligations to the employer.’” Id. (citing Reading Area Water Authority v. UCBR, 137 A.3d 658, 662 (Pa. Cmwlth. 2016)). Further, “[a] negligent act alone does not constitute willful misconduct; rather, the conduct must be of ‘an intentional and deliberate nature.’” Id. (citing Grieb v. UCBR, 827 A.2d 422, 426 (Pa. 2003)).

-----------------------

*An unreported Commonwealth Court case may not be cited binding precedent but can be cited for its persuasive value.  See 210 Pa. Code § 69.414(b) and Pa. R.A.P.  3716

If the case is old, the link may have become stale and may not work, but you can use the case name, court, and date to find the opinion in another source (e.g., Westlaw, Lexis, Google Scholar)

arbitration - FAA - nursing home - state constit. right of access to courts - FAA pre-emption

Kindred Nursing Centers v. Clark – May 15, 2017 – U.S. Supreme Court

https://www.supremecourt.gov/opinions/16pdf/16-32_o7jp.pdf

Respondents Beverly Wellner and Janis Clark—the wife and daughter, respectively, of Joe Wellner and Olive Clark—each held a power of attorney affording her broad authority to manage her family member’s affairs. When Joe and Olive moved into a nursing home operated by petitioner Kindred Nursing Centers L. P., Beverly and Janis used their powers of attorney to complete all necessary paperwork.

As part of that process, each signed an arbitration agreement on her relative’s behalf providing that any claims arising from the relative’s stay at the facility would be resolved through binding arbitration. After Joe and Olive died, their estates (represented by Beverly and Janis) filed suits alleging that Kindred’s substandard care had caused their deaths. Kindred moved to dismiss the cases, arguing that the arbitration agreements prohibited bringing the disputes to court.

The trial court denied Kindred’s motions, and the Kentucky Court of Appeals agreed that the suits could go forward. The Kentucky Supreme Court consolidated the cases and affirmed. The court initially found that the language of the Wellner power of attorney did not permit Beverly to enter into an arbitration agreement on Joe’s behalf, but that the Clark document gave Janis the capacity to do so on behalf of Olive. Nonetheless, the court held, both arbitration agreements were invalid because neither power of attorney specifically entitled the representative to enter into an arbitration agreement.

Because the Kentucky Constitution declares the rights of access to the courts and trial by jury to be “sacred” and “inviolate,” the court determined, an agent could deprive her principal of such rights only if expressly provided in the power of attorney.

Held:  The Kentucky Supreme Court’s clear-statement rule violates the Federal Arbitration Act by singling out arbitration agreements for disfavored treatment.

(a) The FAA, which makes arbitration agreements “valid, irrevocable, and enforceable, save upon such grounds as exist at law or in equity for the revocation of any contract,” 9 U. S. C. §2, establishes an equal-treatment principle: A court may invalidate an arbitration agreement based on “generally applicable contract defenses,” but not on legal rules that “apply only to arbitration or that derive their meaning from the fact that an agreement to arbitrate is at issue,” . . . . The Act thus preempts any state rule that discriminates on its face against arbitration or that covertly accomplishes the same objective by disfavoring contracts that have the defining features of arbitration agreements. The Kentucky Supreme Court’s clear-statement rule fails to put arbitration agreements on an equal plane with other contracts. By requiring an explicit statement before an agent can relinquish her principal’s right to go to court and receive a jury trial, the court did exactly what this Court has barred: adopt a legal rule hinging on the primary characteristic of an arbitration agreement. Pp. 4–7.

(b) In support of the decision below, respondents argue that the clear-statement rule affects only contract formation, and that the FAA does not apply to contract formation questions. But the Act’s text says otherwise. The FAA cares not only about the “enforce[ment]” of arbitration agreements, but also about their initial “valid[ity]”—that is, about what it takes to enter into them. 9 U. S. C. §2. Precedent confirms the point. In Concepcion, the Court noted the impermissibility of applying a contract defense like duress “in a fashion that disfavors arbitration.” 563 U. S., at 341. That discussion would have made no sense if the FAA had nothing to say about contract formation, because duress involves “unfair dealing at the contract formation stage.” Morgan Stanley Capital Group Inc. v. Public Util. Dist. No. 1 of Snohomish Cty., 554 U. S. 527, 547. Finally, respondents’ view would make it trivially easy for States to undermine the Act. Pp. 7–9.

(c) Because the Kentucky Supreme Court invalidated the ClarkKindred arbitration agreement based exclusively on the clearstatement rule, the court must now enforce that agreement. But because it is unclear whether the court’s interpretation of the Wellner document was wholly independent of its rule, the court should determine on remand whether it adheres, in the absence of the rule, its prior reading of that power of attorney. Pp. 9–10. 478 S. W. 3d 306, reversed in part, vacated in part, and remanded.

KAGAN, J., delivered the opinion of the Court, in which ROBERTS, C. J., and KENNEDY, GINSBURG, BREYER, ALITO, and SOTOMAYOR, JJ., joined. THOMAS, J., filed a dissenting opinion. GORSUCH, J., took no part in the consideration or decision of the case.

FDCPA - bankruptcy - proof of claim - old credit card debt

Midland Funding LLC v. Johnson – U.S. Supreme Court – May 15, 2017

https://www.supremecourt.gov/opinions/16pdf/16-348_h315.pdf

Petitioner Midland Funding filed a proof of claim in respondent Johnson’s Chapter 13 bankruptcy case, asserting that Johnson owed Midland credit-card debt and noting that the last time any charge appeared on Johnson’s account was more than 10 years ago. The relevant statute of limitations under Alabama law is six years.

Johnson objected to the claim, and the Bankruptcy Court disallowed it. Johnson then sued Midland, claiming that its filing a proof of claim on an obviously time-barred debt was “false,” “deceptive,” “misleading,” “unconscionable,” and “unfair” within the meaning of the Fair Debt Collection Practices Act, 15 U. S. C. §§1692e, 1692f. The District Court held that the Act did not apply and dismissed the suit. The Eleventh Circuit reversed.

Held: The filing of a proof of claim that is obviously time barred is not a false, deceptive, misleading, unfair, or unconscionable debt collection practice within the meaning of the Fair Debt Collection Practices Act. Pp. 2–10.

(a) Midland’s proof of claim was not “false, deceptive, or misleading.” The Bankruptcy Code defines the term “claim” as a “right to payment,” 11 U. S. C. §101(5)(A), and state law usually determines whether a person has such a right, see Travelers Casualty & Surety Co. of America v. Pacific Gas & Elec. Co., 549 U. S. 443, 450–451. The relevant Alabama law provides that a creditor has the right to payment of a debt even after the limitations period has expired.

Johnson argues that the word “claim” means “enforceable claim.” But the word “enforceable” does not appear in the Code’s definition, and Johnson’s interpretation is difficult to square with Congress’s intent “to adopt the broadest available definition of ‘claim,’ ” . . . .Other Code provisions are still more difficult to square with Johnson’s interpretation.   For example, §502(b)(1) says that if a “claim” is “unenforceable” it will be disallowed, not that it is not a “claim.”   Other provisions make clear that the running of a limitations period constitutes an affirmative defense that a debtor is to assert after the creditor makes a “claim.” §§502, 558. The law has long treated unenforceability of a claim (due to the expiration of the limitations period) as an affirmative defense, and there is nothing misleading or deceptive in the filing of a proof of claim that follows the Code’s similar system.

Indeed, to determine whether a statement is misleading normally “requires consideration of the legal sophistication of its audience,” . . . . .which in a Chapter 13 bankruptcy includes a trustee who is likely to understand that a proof of claim is a statement by the creditor that he or she has a right to payment that is subject to disallowance, including disallowance based on untimeliness. Pp. 2–5.

(b) Several circumstances, taken together, lead to the conclusion that Midland’s proof of claim was not “unfair” or “unconscionable” within the terms of the Fair Debt Collection Practices Act.

Johnson points out that several lower courts have found or indicated that, in the context of an ordinary civil action to collect a debt, a debt collector’s assertion of a claim known to be time barred is “unfair.” But those courts rested their conclusions upon their concern that a consumer might unwittingly repay a time-barred debt. Such considerations have significantly diminished force in a Chapter 13 bankruptcy, where the consumer initiates the proceeding, see §§301, 303(a); where a knowledgeable trustee is available, see §1302(a); where procedural rules more directly guide the evaluation of claims, see Fed. Rule Bkrtcy. Proc. 3001(c)(3)(A); and where the claims resolution process is “generally a more streamlined and less unnerving prospect for a debtor than facing a collection lawsuit,” . . . . .

Also unpersuasive is Johnson’s argument that there is no legitimate reason for allowing a practice like this one that risks harm to the debtor. The bankruptcy system treats untimeliness as an affirmative defense and normally gives the trustee the burden of investigating claims to see if one is stale. And, at least on occasion, the assertion of even a stale claim can benefit the debtor.

More importantly, a change in the simple affirmative-defense approach, carving out an exception, would require defining the exception’s boundaries. Does it apply only where a claim’s staleness appears on the face of the proof of claim? Does it apply to other affirmative defenses or only to the running of the limitations period? Neither the Fair Debt Collection Practices Act nor the Bankruptcy Code indicates that Congress intended an ordinary civil court applying the Act to determine answers to such bankruptcy-related questions. The Act and the Code have different purposes and structural features. The Act seeks to help consumers by preventing consumer bankruptcies in the first place, while the Code creates and maintains the “delicate balance of a debtor’s protections and obligations”. . . .. Applying the Act in this context would upset that “delicate balance.”

Contrary to the argument of the United States, the promulgation of Bankruptcy Rule 9011 did not resolve this issue. Pp. 5–10. 823 F. 3d 1334, reversed.

BREYER, J., delivered the opinion of the Court, in which ROBERTS, C. J., and KENNEDY, THOMAS, and ALITO, JJ., joined. SOTOMAYOR, J., filed a dissenting opinion, in which GINSBURG and KAGAN, JJ., joined. GORSUCH, J., took no part in the consideration or decision of the case.

MERS - recorder of deeds

MERS et al. v. Recorder of Deeds, et al. – Cmwlth. Court (en banc) – May 4, 2017

http://www.pacourts.us/assets/opinions/Commonwealth/out/523CD16_5-4-17.pdf?cb=1 (4-3)

Preliminary objections of MERS sustained in action by various recorders of deeds to collect filing fees under 21 P.S. 351 (Failure to record conveyance)

“[W]e agree with the court’s conclusion in Montgomery County that, “Section 351 does not issue a blanket command that all conveyances must be recorded; it states that a conveyance ‘shall be recorded’ in the appropriate place, or else the party risks losing his interest in the property to a bona fide purchaser.” 795 F.3d at 377. While the plain language of Section 351 “informs property owners of what steps they must take in order to safeguard their interests [it] does not in any way state or imply that failure to record constitutes [an enforceable] violation of the statute . . . .” 795 F.3d at 377-78.  Our conclusion is grounded in the clear language of the statute, and it also is supported by a body of case law interpreting Pennsylvania recording laws that specifically addresses the purpose of those statutes and the effect of a failure to record an interest in land.

“[We are not called upon to evaluate how MERS impacts various constituencies or to adjudicate whether MERS is good or bad.” 795 F.3d at 379. To the extent that public policy matters are implicated in this appeal, there is no question that matters of public policy are solely committed to the legislature, and not this Court.”

Dissent (Brobson, McCullough, Covey)

Although I may ultimately adopt the majority’s view on the merits, a whiff of doubt remains. I, therefore, would prefer to see this matter mature past the pleadings stage before rendering a final judgment on either the proper

construction of Section 1 of the Act of May 12, 1925, P.L. 613, as amended, 21 P.S. § 351, or the authority of the Recorders to maintain their declaratory judgment actions.

bankruptcy - automatic stay - willful violation - emotional distress damages

In re Landsaw – 3d Cir. – April 10, 2017

http://www2.ca3.uscourts.gov/opinarch/161867p.pdf

The filing of a bankruptcy petition operates as an automatic stay of debt collection activities outside of bankruptcy proceedings. 11 U.S.C. § 362(a).  If “an individual [is] injured by any willful violation of [the] stay,” that individual “shall recover actual damages, including costs and attorneys’ fees, and, in appropriate circumstances, may recover punitive damages.” Id. § 362(k)(1).

In the present case, a creditor committed several willful violations of the automatic stay arising from the debtors’ bankruptcy petition. Because of these violations, the Bankruptcy Court awarded the debtors  emotional-distress damages as well as punitive damages under § 362(k)(1).  The District Court affirmed the awards.

We conclude that § 362(k)(1) authorizes the award of emotional-distress damages and that the debtors presented sufficient evidence to support such an award. We also conclude that the debtors were properly awarded punitive damages.

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

If the case is old, the link may have become stale and may not work, but you can use the case name, court, and date to find the opinion in another source (e.g., Westlaw, Lexis, Google Scholar)

UC - late appeal - misleading information

Greene v. UCBR – Cmwlth. Court – March 10, 2017

http://www.pacourts.us/assets/opinions/Commonwealth/out/2750CD15_3-10-17.pdf?cb=1 (2-1)

Claimant denied nunc pro tunc late appeal in spite of the fact that he was incorrectly advised that he could not collect UC benefits while receiving severance pay, since there were “no statements attributable to compensation authorities that address the availability, timing or need for an appeal.”  The Court held that “not every misstatement by an apparently authoritative person will justify a nunc pro tunc appeal; rather, the misinformation must relate to the availability, timing or need for an appeal. “

Dissent

The question of whether permission to appeal nunc pro tunc should be granted is one which lies in equity. See Bass v. Bureau of Corrections, 401 A.2d 1133 (Pa. 1979); see also, Schofield v. Department of Transportation, Bureau of Driver Licensing, 828 A.2d 510, 512 (Pa. Cmwlth. 2003).

This case involved a simple matter of fairness. There is no question that misleading information by a governmental entity was provided to Claimant. This information, at the very least, influenced (if not outright controlled) Claimant's decision-making process about whether and when to appeal, and created an impediment to the timely filing of the appeal. Submitting the equitable question to the standard employed by the Majority places such a noose around it as to choke it of all sense of fairness.

mortgage insurance - HAMP modification - extension of insurance premiums not proper

Fried v. JP Morgan Chase – 3d Cir. – March 9, 2017

http://www2.ca3.uscourts.gov/opinarch/163069p.pdf (30 pp.)

Ginnine Fried bought a home in 2007 for $553,330. It was near high tide in the real estate market, but she had to believe she was getting a bargain, as an appraisal estimated the home’s value to be $570,000.

Fried borrowed $497,950 at a fixed interest rate to make her purchase and mortgaged the home as collateral. Because the loan-to-purchase-price ratio ($497,950 / $553,330) was more than 80%, JPMorgan Chase Bank, N.A. (“Chase”), the servicer for Fried’s mortgage (that is, the entity who performs the day-to-day tasks for the loan, including collecting payments), required her to obtain private mortgage insurance. Fried had to pay monthly premiums for that insurance until the ratio reached 78%; in other words, the principal of the mortgage loan needed to reduce to $431,597, which was projected to happen just before March 2016.

We now know that the housing market crashed in 2008, and the value of homes dropped dramatically. Fried, like many homeowners, had trouble making mortgage payments. Help came when Chase modified Fried’s mortgage under a HAMP, a federal aid program, by reducing the principal balance to $463,737. The rub was that Chase extended Fried’s mortgage insurance premiums an extra decade to 2026.

Whether it could do this depends on how we interpret the Homeowners Protection Act (“Protection Act”), 12 U.S.C. § 4901 et seq. Does it permit a servicer to rely on an updated property value, estimated by a broker, to recalculate the length of a homeowner’s mortgage insurance obligation following a modification or must the ending of that obligation remain tied to the initial purchase price of the home? We conclude the Protection Act requires the latter.