who has not attained a mental age of five years" (Paragraph 10); (3) Section 1330(2) means " only that a parent may be excused from liability under the compulsory attendance provisions of the School Code when, with the approval of the local school board and the Secretary of Education and the finding by an approved school psychologist, the parent elects to withdraw the child from attendance; Section 1330(2) may not be used by defendants, contrary to parents' wishes, to terminate or in any way deny access to a free public program of education and training to any mentally retarded child." (Paragraph 20); and (4) Section 1326 means " only that parents of a child have a compulsory duty while the child is between eight and seventeen years of age to assure his attendance in a program of education and training; and Section 1326 does not limit the ages between which a child must be granted access to a free public program of education and training [and may not be used as such]." (Paragraph 16.) Thus, possible use of these four provisions to exclude (or postpone) retarded children from a program of public education was effectively foreclosed by this Agreement. And on October 22, 1971, the Attorney General issued these agreed upon Opinions.
In addition, the Consent Agreement addresses itself to three other matters involving the education of retarded children which the plaintiffs did not specifically raise in their pleadings. First, in the area of pre-school education, the defendants agreed to cease applying 24 Purd. Stat. Sec. 13-1371
so as to deny retarded children below the age of six access to a free pre-school program of education and training appropriate to their learning capacities whenever the school districts provide such a pre-school program to normal children below the age of six. The Attorney General again issued an Opinion so interpreting Section 1371(1).
Next, the defendants agreed to cease applying 24 Purd. Stat. Sec. 13-1376
so as to deny tuition or tuition maintenance to any mentally retarded person. Basically, Section 1376 provides for the payment of tuition to private schools by the Commonwealth and local school districts (75% and 25% respectively) where, with the approval of the Department of Education, a child afflicted with blindness, deafness, cerebral palsy, brain damage or muscular dystrophy is attending a private school. Prior to the Consent Agreement, this statute was interpreted not to apply to retarded children unless they also suffered from one of the maladies mentioned above. Consequently, if the public sector excluded a retarded child (who lacked a multiple disability) under Section 1375, 1304, 1330 or 1326, his parents had to assume the full financial burden of educating and training him in a private school. Often, because of the special care required, this burden assumed formidable proportions.
Thus, the Attorney General issued an Opinion "construing the term 'brain damage' as used in Section 1376 . . . so as to include thereunder all mentally retarded persons, thereby making available to them tuition for day school and tuition and maintenance for residential school . . ." (Paragraph 27).
Finally, the defendants agreed to cease applying 24 Purd. Stat. Sec. 13-1372(3)
so as "to deny [mentally retarded children] homebound instruction under that Section . . . merely because no physical disability accompanies the retardation or because retardation is not a short-term disability." (Paragraph 31.) Once again, the Attorney General issued an Opinion so construing this provision.
The lengthy Consent Agreement concludes by stating that "[every] retarded person between the ages of six and twenty-one shall be provided access to a free public program of education and training appropriate to his capacities as soon as possible but in no event later than September 1, 1972." (Paragraph 42.) To implement the agreed upon relief and assure that it would be extended to all members of this class, Dennis E. Haggerty, Esq., a distinguished member of the Pennsylvania Bar who has devoted much of his energy to the welfare of retarded children, and Dr. Herbert Goldstein, an eminent expert in the education of retarded children who is Professor and Director of the Curriculum Research and Development Center in Mental Retardation at the Ferkaus Graduate School of Humanities and Social Sciences, Yeshiva University, were appointed Masters at the expense of the Commonwealth. (Paragraph 45). Next, the Consent Agreement charges defendants with the duty within 30 days, to formulate and submit to the Masters a plan to locate, evaluate and give notice to all members of the plaintiff class. (Paragraph 47). Finally, and perhaps most importantly, the Agreement states that:
"The defendants shall formulate and submit to the Masters for their approval a plan to be effectuated by September 1, 1972, to commence or recommence a free public program of education and training for all mentally retarded persons . . . aged between four and twenty-one years as of the date of this Order, and for all mentally retarded persons of such ages hereafter. The plan shall specify the range of programs of education and training, there [sic] kind and number, necessary to provide an appropriate program of education and training to all mentally retarded children, where they shall be conducted, arrangements for their financing, and, if additional teachers are found to be necessary, the plan shall specify recruitment, hiring, and training arrangements." (Paragraph 49) (emphasis added).
Thus, if all goes according to plan, Pennsylvania should be providing a meaningful program of education and training to every retarded child in the Commonwealth by September, 1972.
We then entered an interim order, without prejudice, pending notice to the class of plaintiffs and the class of defendants, which temporarily enjoined the defendants from applying (1) 24 Purd. Stat. Sections 13-1375, 1304, 1330(2), and 1371(1) "so as to deny any mentally retarded child access to a free public program of education and training;" (2) Section 13-1376 "so as to deny tuition or tuition and maintenance to any mentally retarded person except on the same terms as may be applied to other exceptional children, including brain damaged children generally;" and (3) Section 13-1372(3) "[so as to deny] homebound instruction to any mentally retarded person merely because no physical disability accompanies the retardation or because it is not a short-term disability."
Next, in accordance with Rule 23(e), F.R. Civ. P.,
a hearing was scheduled on any objections to the proposed settlement Agreements. We instructed the named plaintiffs and defendants to notify all remaining members of their respective classes (primarily by newspaper in the case of plaintiffs and by direct mailing for the defendants). Proper notice went out to the plaintiffs and only one appeared at the hearing.
None of the remaining defendants appeared, however, because the Commonwealth neglected to send them any notice.
Consequently, we ordered that new notice be given, and rescheduled the hearing for November 12, 1971.
Notice of that hearing went out about October 29th,
and Philip Salkin, Esq. and William B. Arnold, Esq. appeared and filed objections on behalf of the Montgomery County Intermediate Unit and the Lancaster-Lebanon Intermediate Unit respectively. In addition, John D. Killian, Esq. appeared and objected for the Pennsylvania Association of Private Schools for Exceptional Children.
Both attorneys for the Intermediate Units argued to the Court that the notice they received was inadequate to prepare their cases against both the Stipulation of June 18th and the Consent Agreement of October 7th.
They also argued that many districts and intermediate units failed to appear because they did not have enough time to analyze and react to the two rather lengthy and intricate proposals. The attorneys pointed out that since most school boards meet on the first week of each month, these bodies would not even have an opportunity to review the documents until after December 1st.
To extend every element of fairness in this important litigation, we ordered that a second individual notice be sent to all 29 intermediate units and 569 school districts, extending them an opportunity to object and be heard at yet another hearing on December 15, 1971. Following this second notice, the Allegheny Intermediate Unit No. 3, Chester County Intermediate Unit No. 24, Schuylkill Intermediate Unit No. 29, Delaware County Intermediate Unit, and 9 individual school districts within these four Units joined the opponents of the settlement.
On December 15th and 16th, we heard from the objectors and their witnesses. Essentially, the complaining defendants challenged parts of the June 18th Stipulation (dealing with due process hearings) which they claimed were unnecessary, burdensome and administratively unwieldy and impractical.
The wisdom of a few minor portions of the October 7th Consent Agreement was also questioned.
Apart from questioning certain details of the Agreements, the objectors challenged our jurisdiction over the case and over themselves as purported members of a class. Finally, they raised the issue of abstention.
Following this testimony, the proponents of the settlement met with the objectors in an effort to modify the two documents so as to satisfy every one involved. Intensive negotiations ensued. Final legal argument was scheduled for January 31, 1972.
At the request of the litigants, we postponed final argument until February 7, 1972. On that date, only one defendant remained -- the Lancaster-Lebanon Intermediate Unit. All others had withdrawn their objections because subsequent modifications of the Stipulation and Consent Agreement by the proponents satisfied their complaints.
The Pennsylvania Association of Private Schools for Exceptional Children (which is not a member of either class) also expressed dissatisfaction at that hearing.
The arguments presented by Lancaster-Lebanon are essentially legal, that is, the Intermediate Unit does not question the fairness of the proposed settlement to the members of either class,
rather it seeks to destroy the Agreements altogether by raising the issue of jurisdiction as well as the oft-mentioned, but seldom fully understood, issue of abstention.
A. Controversy Under Article III
Preliminarily, the issue of whether the Lancaster-Lebanon Intermediate Unit can even raise jurisdictional issues at a hearing on the proposed settlement of a class action under Rule 23(e) arises. Theoretically, the scope of such a hearing is limited to an inquiry into the fairness of the settlement. See Moore's Federal Practice, § 23.80(4). Since jurisdictional issues relate to the very power of this court to hear this case and bind the parties, however, we think that the objectors must be permitted to raise them.
Although not particularly pressed at final oral argument (which was devoted primarily to absention), Lancaster-Lebanon has raised two distinct jurisdictional issues throughout this litigation. First, Lancaster-Lebanon charges that there is no controversy before this court within the meaning of Article III, Sec. 2 of the United States Constitution because of alleged collusion and total agreement on the merits between the plaintiffs and the Commonwealth in conducting this suit. Secondly, the Intermediate Unit contends that this Court lacks jurisdiction to bind it to any Consent Agreement because the Lancaster-Lebanon Unit received no notice and had no opportunity to appear when the suit was first instituted. (See Section I.B., infra.). We find both contentions without merit.
Undoubtedly, if two litigants commence a suit with the same goals in mind, no controversy exists to give the district court jurisdiction as required by Article III, Sec. 2. See Moore v. Charlotte-Mecklenburg Board of Education, 402 U.S. 47, 91 S. Ct. 1292, 28 L. Ed. 2d 590 (1971); United States v. Johnson, 319 U.S. 302, 63 S. Ct. 1075, 87 L. Ed. 1413 (1943); Muskrat v. United States, 219 U.S. 346, 31 S. Ct. 250, 55 L. Ed. 246 (1911). But a different case arises when litigants begin a suit as adversaries, and then at some later point decide to compromise the dispute. In such an instance, the court does not ipso facto lose jurisdiction over the matter for want of a controversy. Cf. Dixon v. Attorney General of Com. of Pa., 325 F. Supp. 966 (E.D. Pa. 1971) (Biggs, Circuit Judge). This latter rule flows from common sense as well as the fact that even in preparing a compromise, the parties may remain adversaries within the meaning of Article III.
The record in this case clearly shows that the Commonwealth did not collaborate with the plaintiffs in bringing or conducting this suit. Indeed, from January until June, 1971, the Attorney General and the thirteen named school districts vigorously contested every phase of plaintiffs' case. First, the Commonwealth filed motions to dismiss which were accompanied by elaborate briefs. The defendants denied jurisdiction, denied that a claim had been stated upon which relief might be granted, denied that plaintiffs had raised a substantial federal question, and questioned whether PARC had standing to sue. On the merits, they asserted that all of the statutes attacked were founded upon rational bases.
Subsequently, the defendants filed a 13 page brief opposing plaintiffs' motion to convene a three-judge court. Moreover, in discovery, the defendants resisted the production of certain documents and the parties had to appeal to this Court for resolution of the dispute.
In June, 1971, it is true, the parties agreed to settle the issue of due process hearings. Even so, the defendants did not give the plaintiffs carte blanche to draw up any proposal of their choosing; rather the arts of negotiation and compromise were employed, with Commonwealth experts in the field of education also taking part in the discussions.
Despite negotiations on this front, the defendants steadfastly adhered to their original position on plaintiffs' equal protection claims. Indeed, it was not until after a day of testimony from four distinguished experts that the Commonwealth agreed to relent on this issue as well. Far from an indication of collusion, however, the Commonwealth's willingness to settle this dispute reflects an intelligent response to overwhelming evidence against their position.
Once the compromise was prepared, of course, plaintiffs and the named defendants shared identical interests in seeking approval of the settlement. Nevertheless, because these defendants refused to concede the unconstitutionality of the statutes and continued to enforce them, the parties remained adversaries on the constitutional issues which are critical to our jurisdiction. Hence, we conclude that a controversy exists under Article III, Sec. 2.
B. Over the Parties
Next, Lancaster-Lebanon argues that it is not bound by these Consent Agreements or the Injunction because this Court lacks jurisdiction, not necessarily over the subject matter, but over it as a party. The Intermediate Unit predicates this assertion upon the concept that under the Due Process Clause, notice at the commencement of the litigation constitutes a prerequisite to a court's jurisdiction over the parties. As applied to the facts of this case, however, we disagree.
We begin by holding that the defendants constitute a class under Rule 23(B)(1)(B), F.R. Civ. P. This section is appropriate because, as a practical matter, once the issues are decided against one school district within an intermediate unit, or one intermediate unit within the Commonwealth all other districts or intermediate units will ultimately be bound by the result. In other words, "adjudications with respect to individual members of the class [would] as a practical matter be dispositive of the interests of the other members not parties to the adjudication . . ." Rule 23(b)(1)(B). This result follows because (1) intermediate units have an obligation to coordinate the education of exceptional children where member school districts are unable to sustain individual programs, and (2) the Commonwealth, for reasons of economy and administration, must necessarily maintain a uniform set of rules and regulations governing the responsibilities of all school districts and intermediate units within the state.
The notice requirements for a (b)(1) class are set forth in Rule 23(d)(2) which provides as follows:
"(d) Orders of Conduct of Actions. In the conduct of actions to which this rule applies, the court may make appropriate orders: