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MATTER FRANKLIN TOWNSHIP BOARD SUPERVISORS (TWO CASES). APPEAL ALLEN B. MCNEELY. NO. 104 MARCH TERM (10/28/77)

SUPREME COURT OF PENNSYLVANIA


decided: October 28, 1977.

IN THE MATTER OF THE FRANKLIN TOWNSHIP BOARD OF SUPERVISORS (TWO CASES). APPEAL OF ALLEN B. MCNEELY. NO. 104 MARCH TERM, 1977. APPEAL OF CHARLES S. WOOD AND NORMA W. SCHULTZ. NO. 107 MARCH TERM, 1977

COUNSEL

John W. McIlvaine, Uniontown, for appellant at No. 104.

Thomas J. Terputac, Washington (for Charles S. Wood), Sherman H. Siegel, Washington (for Norma W. Shultz), for appellants at No. 107.

Thomas J. Terputac, Sherman H. Siegel, Washington, William R. Davis, Waynesburg, for appellee at No. 104.

John W. McIlvaine, Uniontown, William R. Davis, Waynesburg, for appellee at No. 107.

Robert P. Kane, Atty. Gen., J. Justin Blewitt, Jr., Deputy Atty. Gen., Chief, Civ. Litigation, G. Alan Kramer, Deputy Atty. Gen., Harrisburg, for intervenor (Com. of Pa.).

Eagen, C. J., and O'Brien, Roberts, Pomeroy, Nix and Manderino, JJ. Nix, J., filed a concurring and dissenting opinion in which Manderino, J., joins.

Author: Roberts

[ 475 Pa. Page 69]

OPINION OF THE COURT

This is an appeal from an order of the Court of Common Pleas of Greene County removing from office the three supervisors of Franklin Township.*fn1

On March 19, 1976, Allen B. McNeely, one of the three supervisors, filed a complaint pursuant to section 503 of the Second Class Township Code*fn2 for the removal of the other two supervisors, Charles Wood and Norma Shultz. The complaint, signed by 271 electors,*fn3 alleged that Wood and Shultz had failed to perform their official duties, and had

[ 475 Pa. Page 70]

    violated the Second Class Township Code, in several respects.*fn4 The court issued a rule upon Wood and Shultz to show cause why their offices should not be declared vacant.

Wood and Shultz then began contacting the electors who had signed the complaint. By April 12, 1976, the hearing date on the rule to show cause, Wood and Shultz had contacted 109 of those persons who had signed the complaint, and had obtained the signatures of 100 of those persons on a counter petition to have their names withdrawn from the original complaint. At the April 12 hearing Wood and Shultz filed preliminary objections to the complaint. Also at that hearing McNeely alleged that Wood and Shultz had been threatening and harassing the electors who had signed the complaint for their removal. On the basis of McNeely's allegations, the court issued a decree "enjoining either of the parties in contacting any other signatores [sic] on the original petition filed for their removal except by leave of the Court . . . ."

[ 475 Pa. Page 71]

On April 19, 1976, Wood and Shultz filed a motion to vacate the injunction. A hearing on this motion was set for April 21, to be heard at the time of the hearing on their preliminary objections to the complaint.

At the April 21, 1976 hearing, seven of the witnesses called by Wood and Shultz asked the court to allow them to withdraw their names from the complaint for the removal of Wood and Shultz.*fn5 One of the witnesses testified that he did not understand it was for the removal of Wood and Shultz. The other witnesses indicated that they wanted their names withdrawn because they thought the complaint was for the removal of all three supervisors, or that, although they understood that the complaint was for the removal of Wood and Shultz, they now believed that removal

[ 475 Pa. Page 72]

    proceedings should be held as to all three supervisors.*fn6 Wood and Shultz offered to testify about statements made to them by other electors who had signed the complaint, and later signed the counter petition, but an objection to this evidence was sustained. After their witnesses testified, Wood and Shultz requested a thirty day continuance during which they would be allowed to contact the rest of the electors who had signed the petition for their removal. At this point, the court stated that it was treating this proceeding as an action for removal of all three supervisors. At the conclusion of the hearing, the court denied Wood's and Shultz' motion for a continuance, denied their motion to vacate the injunction, and overruled their preliminary objections.*fn7 No appeal was taken from the order denying the motion to vacate the injunction, or from the decree granting the injunction.

A hearing on the merits of the removal complaint was held on May 27 and 28, 1976. McNeely was the principal witness in favor of removal. The report of the certified public accountants who audited Franklin Township for the year ending December 31, 1975 was also admitted into evidence. The evidence presented revealed that many of the financial transactions of the Township, including payment of bills, borrowing money, and the reporting of bids on township purchases, were undertaken without approval at regular meetings of the supervisors, or were not reported in the minutes of those meetings.

The evidence presented also disclosed a series of transactions which involved transfers between special and general

[ 475 Pa. Page 73]

    funds,*fn8 and a tax anticipation loan taken without creation of a sinking fund.*fn9 In January, 1975, $23,000 was transferred from special funds to general funds to meet payroll costs. No resolution was passed by the Board authorizing these transfers. Each of the checks transferring the funds was signed by Shultz, who was secretary and treasurer for the Township, and by either Wood or McNeely. At the January 27 meeting of the Board, the supervisors adopted a resolution to borrow $40,000 for six months. Some time before March 10, 1975,*fn10 Wood and Shultz decided to borrow $50,000, instead of the previously authorized $40,000. They obtained a $50,000 tax anticipation loan due at the end of the year. No sinking fund was created when the loan was taken. Part of the loan was used to repay the $23,000 transferred from special funds. When the loan became due, $50,000 was transferred from special funds to repay the loan, again without any resolution authorizing the transfer.

The trial court found that all three supervisors had failed to perform their official duties. In an opinion and order filed November 5, 1976, the court ordered that the offices of all three supervisors be declared vacant.*fn11 Exceptions were

[ 475 Pa. Page 74]

    filed, and the court issued an opinion and order on January 21, 1977, dismissing the exceptions and making final its November 5 order removing the three supervisors from office. All three supervisors appeal.

I. Appeal of McNeely

McNeely argues that the trial court erred in asserting jurisdiction over him in the absence of a complaint calling for his removal. We agree.

Section 503 of the Second Class Township Code*fn12 provides that a township officer may be removed for refusal or neglect to perform official duties "upon complaint in writing by five percentum of the registered electors of the township . . . ." Without such a complaint, the court does not have the power to order the removal of a township official pursuant to section 503.

The court concluded that it has a duty "of its own initiative . . . to assess the fault and find the responsibility for . . . violations . . . ." While it is the duty of the court to assess fault once removal proceedings are instituted, the court is not empowered to decide if such proceedings should be instituted.

Because no complaint was filed for the removal of McNeely, the trial court's order vacating his office is reversed.

[ 475 Pa. Page 75]

II. Appeal of Wood and Shultz

A. Wood and Shultz contend that the April 12, 1976 injunction, which enjoined them from contacting any more of the electors who had signed the petition for their removal, is invalid. They claim the injunction was issued in violation of Pa.R.Civ.P. 1531, and that it infringed on their rights to freedom of expression.

We need not reach this issue, however, as Wood and Shultz failed to take a timely appeal from the issuance of the injunction. The injunction was a special injunction. A special injunction grants relief which is auxiliary to the main relief requested in the complaint. See Rosenzweig v. Factor, 457 Pa. 492, 327 A.2d 36 (1974); 5 Goodrich-Amram, Procedural Rules Service § 1531(a):1 (2d ed. 1977). Here the injunction, which was to prevent Wood and Shultz from contacting and possibly harassing the electors who signed the complaint, was entirely separate from and collateral to the relief requested in the complaint, removal of Wood and Shultz for failure to perform their duties. An appeal from the issuance of a special injunction is authorized by statute. Act of February 14, 1866, P.L. 28, § 1, 12 P.S. § 1101 (1953); Rosenzweig v. Factor, supra.*fn13 Having failed to avail themselves of the right to appeal the injunctive order, Wood and Shultz cannot now attack it collaterally as a basis for invalidating the removal proceedings, which were not concluded until nine months after the injunction was issued.*fn14

[ 475 Pa. Page 76]

B. Wood and Shultz raise several additional claims which arguably relate to the validity of the removal complaint.

Wood and Shultz argue that the court erred in admitting an amended complaint, which was filed at the April 21, 1976 hearing, nine days after preliminary objections were filed.*fn15 See generally, Pa.R.Civ.P. 1028(c) ("A party may file an amended pleading as of course within ten (10) days after service of a copy of preliminary objections."). They argue that the amended complaint should not have been admitted because it was not recirculated. This argument is without merit. The amended complaint was a verbatim copy of the original complaint. The only change was that a new affidavit, with the same wording as the first affidavit, was executed before a different notary, in an effort to eliminate any possible irregularities in the manner in which the affidavit was executed. We see no basis for requiring the electors to sign the complaint again before a new affidavit may be executed.

Wood and Shultz also claim that two of the affiants are not registered voters of Franklin Township. Section 503 of the Second Class Township Code makes no requirement that the affiants be registered voters, however. Therefore, we find no basis for holding the affidavits are invalid.*fn16

[ 475 Pa. Page 77]

Wood and Shultz also challenge the form of the affidavit,*fn17 and claim that the original complaint was invalid because the person who notarized the affidavit had also signed the complaint. These claims were not raised in preliminary objections or in the answer to the amended complaint, and therefore are waived. Pa.R.Civ.P. 1032.

Finally, Wood and Shultz argue that the court erred when it sustained an objection to testimony they offered at the hearing on their preliminary objections. Wood and Shultz offered to testify as to what some of the electors who had signed the counter petition claimed they were told at the time they signed the original complaint. The court properly excluded this testimony as hearsay. Wood and Shultz were not present when these electors signed the complaint, and could testify only as to out of court declarations later made by these electors.*fn18

C. Wood and Shultz next argue that the court did not have grounds to order their removal pursuant to section 503 of the Second Class Township Code. Section 503 provides for the removal of any township officer who "refuses

[ 475 Pa. Page 78]

    or neglects to perform his duties."*fn19 Pursuant to this provision, a township supervisor may be removed for failure to perform duties required of him by the Second Class Township Code or other applicable statutes. Foltz Appeal, 370 Pa. 567, 88 A.2d 871 (1952) (dictum); Crane's Appeal, 344 Pa. 624, 26 A.2d 457 (1942). We conclude the trial court's findings of fact are supported by the record, and demonstrate that Wood and Shultz have failed to perform their duties in several significant respects.

The court found that the supervisors failed to keep proper records of township proceedings, and failed to follow proper procedures in performing official acts. The court found:

"1. [The supervisors] failed to keep full and accurate minutes of their meetings and the conduct of official township business in violation of Section 513.*fn20

2. They failed to keep complete and accurate financial records of all township monies, and to have regular reports made thereof to the Board at its regular meetings in violation of Section 532.*fn21

5. They failed to keep a full and complete record of having advertised for bids when required, under the provisions of Section 802 of the Township Code*fn22 and made payment of bills of the township without official board action reflected in the minutes."

Section 513 of the Second Class Township Code imposes a duty on the supervisors to keep minutes of their proceedings:

"The board of township supervisors shall keep minutes of its proceedings . . . . All such books shall be open for the inspection of any elector or taxpayer . . . ."

[ 475 Pa. Page 79]

(emphasis added).*fn23 The importance of adequate records should be stressed, for these records enable the Township Auditors, as well as electors and taxpayers, to determine what actions have been legally approved by the Board of Supervisors, and whether the supervisors have lived up to their public trust. See Pennsylvania State Association of Township Supervisors, Handbook for Township Officials 34-35.*fn24

The record supports the trial court's determination that the supervisors failed to perform this duty. The accountants who audited the Township criticized the minutes for failure to record the advertisement for bids pursuant to section 802 of the Second Class Township Code,*fn25 and for failure to indicate when the opinion of the township solicitor was requested.*fn26 The supervisors also paid township bills

[ 475 Pa. Page 80]

    without official board action reflected in the minutes.*fn27 McNeely testified that the minutes for 1974 and 1975 were not even typed, and thus were not available to the public as required by section 503 of the Second Class Township Code, until January, 1976.*fn28 As the court observed, the minutes "are so patently crude and incomplete it is almost impossible to tell what township business was lawfully transacted . . . with respect to the purchase of equipment and supplies."

Closely related to the failure to keep proper minutes is the failure to keep accurate financial records, and to make reports at regular meetings of the Board. Again the duties imposed by the Second Class Township Code are clear:

"The township treasurer . . . shall keep distinct and accurate accounts of all sums received from taxes and

[ 475 Pa. Page 81]

    other sources, which account shall be open to the inspection of the supervisors and taxpayers of the township."*fn29

Accurate accounts must be kept for the same reasons that adequate minutes of Board proceedings are required. See Pennsylvania State Association of Township Supervisors, Handbook for Township Officials 34-35. Yet, as the trial court found:

"[T]he books of accounts of the township were kept in such a careless fashion that the Board at any regular meeting could not know, and actually had no way of knowing where the township finances stood at any given time . . . there being no Treasurer's report regularly made and kept. The only apparent record that existed was the record contained in the check book of the Treasurer."*fn30

This finding is supported by McNeely's testimony. He testified that at many meetings he was unable to obtain the balances of the Township's accounts.*fn31 No official treasurer's report was submitted at any meeting of the Board in either 1974 or 1975. Clearly, the supervisors have failed to

[ 475 Pa. Page 82]

    perform their duty to maintain adequate records of the accounts of the Township.*fn32

In summary, the record supports the findings of fact and conclusions of law that Wood and Shultz have failed to perform their duties within the meaning of the Second Class Township Code.*fn33 As the trial court stated:

"[T]he business of the township involving the handling of funds in the amount of approximately one quarter of a million dollars, has been conducted with gross informality, inattention to official duties and indifference that demonstrate a cupable [sic] peverseness [sic] and indicates on the part of the officers, an insensitivity to the public trust."

D. Finally, Wood and Shultz challenge the constitutionality of section 503 of the Second Class Township Code. They argue that the statute fails to provide them with due process, and that section 503 violates article VI, section 7 of the Pennsylvania Constitution. These issues were not raised in preliminary objections, or in the answers filed by Wood and Shultz, and therefore have been waived. Pa.R.C.P. 1032.

The order of the court of common pleas is reversed as to McNeely, and affirmed as to Wood and Shultz.

NIX, Justice, concurring and dissenting.

The action seeking the removal of two supervisors of Franklin Township, Mr. Charles Wood and Ms. Norma Shultz, was commenced under Section 503 of the Second Class Township Code, Act of May 1, 1933, P.L. 103, § 503, as amended, 53 P.S. § 65503 (1957). Section 503 provides:

[ 475 Pa. Page 83]

    indicated a defect in their endorsement to the petition and requested their signatures be withdrawn. The information obtained by Wood and Shultz, as a result of their contact with the various alleged signatories, indicated that misinformation had been given in an effort to induce voters to sign the petition; that others were not given a sufficient opportunity by the circulators to fully read the contents of the complaint; and still others were never presented the complaint to be read.

Rather than make some effort to inquire further into the legal sufficiency of the complaint, the hearing court saw fit to restrain appellants, Wood and Shultz, from further contact with the purported signatories. The justification for this action was the assertion by the proponent of the complaint that Wood and Shultz were "harassing" the electors. No opportunity was given to Wood or Shultz to answer that allegation. Nor did the court seek an alternative method to ascertain the legitimacy of the complaint in view of the questions that should have been raised as a result of the findings submitted by Wood and Shultz.

The majority chose not to address the issue of the validity of the restraining order classifying it as a special injunction which should have been pursued in a separate appeal. A separate appeal would be the proper procedural tack in the case of a special injunction pursuant to Pennsylvania Rule of Civil Procedure 1531. Act of February 14, 1866, P.L. 28, § 1, 12 P.S. § 1101. See, Rosenzweig v. Factor, 457 Pa. 492, 327 A.2d 36 (1974). However, the challenged order was clearly not a special injunction pursuant to Rule 1531 but merely an ancillary ruling during the course of the underlying action in this case.*fn1 As a ruling during the course of the proceedings

[ 475 Pa. Page 85]

    appellants did properly assign it as a ground of error for review in this direct appeal.

With regard to the merits, in my judgment, the actions of the hearing court were clearly violative of the most fundamental due process concepts. While it is quite understandable that a court would not condone harassment of the signatories, there was here an insufficient basis upon which to conclude that any harassment had in fact occurred. Further, it remained uncontradicted that at least 100 of the 109 individuals contacted had reported circumstances which, if believed, would invalidate their signatures. It is clear that it was incumbent upon the court to make some further inquiry as to the legitimacy of the other purported signatures which were necessary to provide the court with jurisdiction to proceed further in this action. The court's failure in this regard, in my judgment, was fatal.


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