Appeals from the Order of the Court of Common Pleas of Allegheny County in cases of Frank Hanek v. The Cities of Clairton, et al., No. 2503 January Term, 1974; and Benjamin Lustman, individually and as representative of Members of a Class, Plaintiffs v. City of Pittsburgh, Intervenor v. West Mifflin Borough, a Municipal Corporation, and Joseph W. Schieck, Tax Collector of West Mifflin Borough, No. 1239 October Term, 1973.
Franklyn E. Conflenti, with him David R. Cashman, and Cauley, Birsic & Conflenti, for appellant, Hanek.
Lee A. Donaldson, Jr., with him James M. McElfish, Richard G. Zeleznik and Bresci R. P. Leonard, for appellants-appellees, West Mifflin Borough, et al.
Grace S. Harris, Assistant City Solicitor, with her Mead J. Mulvihill, Jr., City Solicitor, for appellee, City of Pittsburgh.
Willard R. Crout, for appellees, Lustman, et al.
President Judge Bowman and Judges Crumlish, Jr., Kramer, Wilkinson, Jr., Mencer, Rogers and Blatt. Opinion by President Judge Bowman.
Immediately prior to January 1, 1973, Fred Hanek (Hanek) and Benjamin Lustman (Lustman), residents of Pittsburgh employed within the neighboring municipalities of Neville Township (Township) and West Mifflin Borough (Borough), respectively, were within the classes of taxpayers subject to the following taxes on wages:
(1) the 1% Pittsburgh City wage tax, imposed pursuant to the authority contained within The Local Tax Enabling Act (Enabling Act);*fn1
(2) the 1% Township wage tax (Hanek) and the 1% Borough wage tax (Lustman), both imposed pursuant to the Enabling Act; and
(3) the 1% Pittsburgh School District wage tax, imposed pursuant to the Act of August 24, 1961, P.L. 1135, as amended, 24 P.S. § 588.1 et seq. (Act No. 1135). The cumulative financial impact on the wages of each taxpayer was 2%, not 3%, because the Enabling Act required the Township and Borough to credit Hanek's and Lustman's payments of the Pittsburgh City tax against the taxpayers' liabilities for the Township and Borough taxes.*fn2
When the City of Pittsburgh elected to discontinue the imposition and collection of its own wage tax as of December 31, 1972, Hanek and Lustman assumed that this apparent reduction in their tax liabilities would be favorably reflected on the "bottom lines" of their paychecks.
From the perspectives of the Township and Borough, however, the elimination of the Pittsburgh City tax also removed the raison d'etre for allowing taxpayers a credit against their Township and Borough tax liabilities. Thus, concurrently with the vacation of the Pittsburgh City tax, the Township and Borough notified all persons employed within their respective bounds, including Pittsburgh residents, that, as of January 1, 1973, the Township and Borough taxes were to be withheld from their paychecks.
These governmental actions were independently challenged by Hanek and Lustman, each of whom initiated an equity action in the Allegheny County Court of Common Pleas on his own behalf and as a member of a class, seeking both an injunction against any further withholding of Township and Borough wage taxes and the refund of all moneys "improperly" withheld since January 1, 1973. While Lustman's complaint identified the Borough as the sole municipal defendant,*fn3 Hanek elected a far more ambitious course. His complaint named 128 local taxing authorities as defendants.*fn4
Eighty of Hanek's defendants responded either with answers or with preliminary objections. In a decree nisi, entered July 2, 1974, the chancellor sustained defendants' preliminary objections in the nature of demurrers and dismissed Hanek's complaint as to all defendants. Hanek's subsequent exceptions were overruled and the decree was made absolute on July 24, 1974. Hanek's appeal to this Court has ensued therefrom.
Unlike Hanek, Lustman achieved partial success at the common pleas level. His success was a direct result of the coterminous, multiple taxation of Borough residents. That is, both the Borough itself and the West Mifflin School District have imposed 1% wage taxes pursuant to the Enabling Act.*fn5 This, said the lower court, distinguished Lustman's situation from Hanek's and, under the automatic halving provision of Section 8 of the Enabling Act,*fn6 necessitated a reduction in the effective rate of the Borough tax to 1/2% as applied to Lustman. Lustman was awarded an injunction against future withholdings in excess of 1/2% of his wages and a refund of all moneys withheld since January 1, 1973, in excess of that rate. The Borough has appealed to this Court. Lustman has lodged no cross appeal.
Primarily because of the antithetical postures of the appellants herein (Hanek and the Borough), the two appeals present no common questions of law in the strict procedural sense. However, it is fundamentally clear that, excepting the application of the automatic halving provision of Section 8 of the Enabling Act, the questions raised and our responses thereto will produce a common result because of the ...