Appeal from the Order of the Department of Banking in case of I. Marvin Miller, Individually and as a Licensed Real Estate Broker, and the Pennsylvania Association of Realtors v. Department of Banking, Commonwealth of Pennsylvania and Great Valley Savings Association, No. 82-001.
Thomas D. Caldwell, Jr., Caldwell, Clouser & Kearns, for petitioners.
Paul A. Adams, with him, Carl F. Mogel, for respondents.
President Judge Crumlish, Jr. and Judges Rogers, Williams, Jr., Craig, MacPhail, Barry and Colins. Opinion by President Judge Crumlish, Jr. Judge Williams, Jr., dissents. This decision was reached prior to the resignation of Judge Williams, Jr. Concurring and Dissenting Opinion by Judge Craig. Judge Barry joins in this concurring and dissenting opinion.
[ 87 Pa. Commw. Page 578]
The Pennsylvania Association of Realtors appeals an order of the Secretary of Banking dismissing its administrative complaint.*fn1 We reverse and remand.
The Association's complaint challenged the validity of the Department of Banking actions approving the requests of six savings and loan service corporations to engage in third-party real estate brokerage.*fn2 These authorizations occurred after the Department's Savings Association Bureau decided that it would be in the public interest to permit third-party brokerage by qualified service corporations. The approvals in
[ 87 Pa. Commw. Page 579]
dispute were granted through an individual application process, pursuant to a Department regulation providing for case-by-case authorization of service corporation activity.*fn3
Our scope of review of the Secretary's decision is limited. We must uphold his order unless it is in violation of constitutional rights, not in accordance with the law, or a necessary finding of fact is not supported by substantial evidence. Section 704 of the Administrative Agency Law.*fn4
In this appeal, the Association initially claims that the Secretary committed an error of law in concluding that the decision to authorize third-party brokerage by qualified service corporations was not a regulation which required promulgation as provided in the statute formerly known as the "Commonwealth Documents Law."*fn5
The Association reasons that since the decision to permit third-party brokerage by suitable applicants applies to future activity and has the potential of affecting service corporations generally, it is not an individual adjudication. This argument erroneously assumes that a Department pronouncement is subject to but two characterizations: an adjudication or a regulation. However, an administrative agency may also adopt a general policy to be applied in future adjudications. Pennsylvania Human Relations Commission v. Norristown Area School District, 473 Pa. 334,
[ 87 Pa. Commw. Page 580374]
A.2d 671 (1977). This is precisely what the Department did here. It decided to authorize third-party brokerage by qualified service corporations as and when they applied for authorization of brokerage activity. In short, it approved the right to apply ; it did not authorize blanket brokerage activity as of right. We therefore hold that the Secretary correctly concluded that the Department's general policy decision need not be promulgated. Norristown Area School District.
The Association next attacks the Secretary's legal conclusion that a specific regulation on the third-party brokerage practice is not required.
The Secretary has not erred. Section 922(n) of the Savings Association Code*fn6 states that "the department shall have the right to define service corporations and the activities thereof." Nothing in this provision requires that the varied activities of service corporations be defined solely by regulation. Moreover, in our view, the legislation's intent is that the Department exercise its administrative discretion in providing flexibility and ready response to economic changes which affect the viability of savings and loan associations.*fn7 When the Federal Home Loan Bank Board ...