Appeal from the Order of the Secretary of Public Welfare in case of In the Matter of Albert Grady, Commonwealth Concerns, Inc. and Commonwealth Concerns of Hawley, Inc., Order of May 28, 1974.
Joseph N. Bongiovanni, III, with him Joseph L. Della Guardia and Speese, Kephart & Bongiovanni, for appellants.
Marx S. Leopold, Chief Counsel, for appellee.
President Judge Bowman and Judges Crumlish, Jr., Kramer, Wilkinson, Jr., Mencer, Rogers and Blatt. Opinion by Judge Wilkinson, Jr.
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This case is an appeal from an order of the Secretary of the Public Welfare granting a license to appellants
[ 18 Pa. Commw. Page 484]
to operate group homes*fn1 for mentally retarded individuals subject to certain restrictions contained in that order. Appellants argue that the Secretary's action in restricting their license was not based on competent evidence and deprived appellants of their property without due process of law. In order to pass upon these questions, we must set forth in some detail the relevant facts that form the basis of this appeal.
We are dealing with three entities in this case: the two appellants, Albert Grady, an individual renowned in the field of treatment and care of mentally retarded persons, and Commonwealth Concerns, Inc., a corporation set up to deliver mental health services; and also Commonwealth Concerns of Hawley, Inc. (Hawley), a corporation owned by Commonwealth Concerns, Inc., and set up to operate an institutional for retarded young males at Hawley, Pennsylvania. Hawley is not a party to this action. It appears from the record that Grady was instrumental in organizing Hawley, but did not personally direct the day-to-day operations there. However, it also appears that there is a close correlation between the officers and directors of Hawley and the officers and directors of Commonwealth Concerns. Inc.*fn2
After two tragic deaths occurred at the Hawley institution in August of 1971, the Secretary immediately closed Hawley and subsequently prevented various counties which were dealing with Commonwealth Concerns, Inc. from funding any Commonwealth Concerns, Inc.
[ 18 Pa. Commw. Page 485]
institutions. An appeal was filed to this Court contesting the Secretary's order closing Hawley; however this appeal was dropped upon an agreement of prior counsel for Commonwealth Concerns, Inc. and the Department of Public Welfare*fn3 that a hearing would be held to ascertain the competency of Grady, Commonwealth Concerns, Inc., and Hawley to operate group homes in accordance with the regulations contained in 3 Pa. Bull. 338 (February 17, 1973).
The Secretary specially appointed a hearing examiner who took testimony and filed a report and recommendation. Based on that report, the Secretary ordered: that Hawley was not competent to operate any facility in Pennsylvania; that Albert Grady and/or Commonwealth Concerns, Inc. would be limited to operation of three group homes at any time, and those homes must be located within fifty miles of Grady's home or Commonwealth Concerns, Inc.'s principal place of business. The ...