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FORD MOTOR COMPANY v. COMMONWEALTH PENNSYLVANIA (03/25/86)

decided: March 25, 1986.

FORD MOTOR COMPANY, APPELLEE,
v.
COMMONWEALTH OF PENNSYLVANIA, DEPARTMENT OF STATE; STATE BOARD OF VEHICLE MANUFACTURERS, DEALERS AND SALESPERSONS; AND ROBERT J. HABEEB, CHAIRMAN, STATE BOARD OF VEHICLE MANUFACTURERS, DEALERS AND SALESPERSONS, APPELLANT, AND MCCRACKIN-STURMAN FORD, INC., APPELLANT-INTERVENOR



Appeal from Adjudication and Order of the Commonwealth Court of Pennsylvania December 17, 1984 at No. 3077 C.D., 1984

COUNSEL

Robert E. Kelly, Jr., Marybeth S. Christiansen, Harrisburg, for Ford Motor Co.

Joyce McKeever, Bureau of Professional and Occupational Affairs, Pittsburgh, Vincent J. Grogan, Anthony V. Cortese, Pittsburgh, for McCrackin-Sturman Ford, Inc., intervenor.

Jerome T. Foerster, Andrew S. Gordon, Allen C. Warshaw, Office of the Atty. Gen., Harrisburg, for State Bd. of Vehicle Mfrs., Dealers and Salespersons.

Nix, C.j., and Larsen, Flaherty, McDermott, Hutchinson, Zappala and Papadakos, JJ. Hutchinson, J., filed a concurring opinion. Nix, C.j., filed a dissenting opinion in which McDermott, J., joined. Flaherty and Zappala, JJ., did not participate in the consideration or decision of this case.

Author: Larsen

[ 510 Pa. Page 93]

OPINION ANNOUNCING THE JUDGMENT OF THE COURT

At issue in this appeal is an order of Commonwealth Court that: (1) grants the application for summary relief of the appellee, Ford Motor Company (Ford), by directing the State Board of Vehicle Manufacturers, Dealers and Salespersons (Board) to issue to Ford such permits as are necessary to establish a new dealership in the metropolitan Pittsburgh area, and (2) denies the petition for leave to intervene brought by McCrackin-Sturman Ford, Inc., (McCrackin) an existing dealer and statutory protestor in the relevant market area.

On February 29, 1984, appellee Ford gave notice to the Board and to each new vehicle dealer entitled to receive notice, of its intention to establish a new dealership in the north suburban Pittsburgh market area. The notices were given by Ford pursuant to the provisions of Section 18(a) of the then newly enacted Board of Vehicles Act, Act of December 22, 1983, P.L. 306, 63 P.S. § 818.18(a) which provides:

Limitations on establishing or relocating dealers

(a) Additional or relocation of new vehicle dealers. -- In the event that a manufacturer seeks to enter into a franchise establishing an additional new vehicle dealer or relocating an existing new vehicle dealer within or into a relevant market area where the same line-make is then represented, the manufacturer shall in writing first notify the board and each new vehicle dealer in such line-make in the relevant market area of the intention to establish an additional dealer or to relocate an existing dealer within or into that market area. Within 20 days after the end of any appeal procedure provided by the manufacturer, any such new vehicle dealer may file with the board a

[ 510 Pa. Page 94]

    protest to the establishing or relocating of the new vehicle dealer. When such a protest is filed, the board shall inform the manufacturer that a timely protest has been filed, and that the manufacturer shall not establish or relocate the proposed new vehicle dealer until the board has held a hearing, nor thereafter, if the board has determined that there is good cause for not permitting the addition or relocation of such new vehicle dealer.

Responding to the notice, appellant McCrackin filed a protest to the establishment of a new dealership within the relevant market area.*fn1 On June 21, 1984, a hearing on the protest was convened. When the hearing recessed on that day, it was apparent that one or more additional days would be necessary to finish receiving the evidence. It was announced that because the Board was unable to meet the next day (Friday, June 22, 1984) the hearing could not be resumed until the following week. This presented a conflict with the schedule of counsel for McCrackin and he requested a continuance. Prior to a continuance being granted both parties were advised that each would have to waive the provisions of Board of Vehicles Act (Section 818.7) which provides that a "final determination" must be made by the Board within 120 days after the filing of a protest. Subsequently, both sides agreed to waive the 120 day rule with Ford attaching a proviso that its waiver was conditioned upon the case being decided by August 15, 1984. This limiting provision was communicated to the Board in a telephone conversation and a confirming letter. McCrackin alleges that it was not informed of this proposed limitation until July 23, 1984 at a preliminary conference two days

[ 510 Pa. Page 95]

    before the hearing was resumed. When the reconvened hearing was concluded (July 27, 1984), Ford agreed to extend its waiver limitation to August 31, 1984. In reply, counsel for McCrackin expressed the belief that Ford's waiver to a specific date was meaningless.*fn2

On August 31, 1984, in a conference call meeting, the Board, after discussion, orally voted to sustain the protest of McCrackin. No written adjudication was made at that time even though the schedule that had been announced by Board counsel called for a final decision in writing by August 31, 1984.*fn3 Counsel for the Board was directed to prepare a formal adjudication for filing at a future date. Shortly thereafter, both parties became aware of the decision to uphold McCrackin's protest and deny Ford permission to establish the proposed new dealership.

On or about October 22, 1984, Ford filed a petition for review in the Commonwealth Court seeking the following relief: (1) A declaratory judgment: (a) that the Board's jurisdiction and authority to rule in the McCrackin protest expired and the protest is deemed denied by operation of law; (b) that no good cause exists for refusing to permit Ford to establish the proposed new dealership; and (c) that Ford is entitled to establish the proposed new dealership; (2) A writ of mandamus directing the Board to: (a) issue a decision denying McCrackin's protest and affirming Ford's right to establish the proposed new dealership; and (b) issue all licenses to Ford which are necessary to establish the proposed new dealership; and (3) A permanent injunction enjoining the Board from issuing any order prohibiting Ford from establishing the proposed new dealership and upholding the protest of McCrackin and from withdrawing

[ 510 Pa. Page 96]

    all necessary licenses and permits from Ford for the establishment of the proposed new dealership. On October 26, 1984, the Board issued its written adjudication and order setting forth the decision it had reached by oral vote on August 31, 1984.

Ford argues that the oral vote and decision made by the Board at the August 31, 1984 conference call meeting is not a "final determination" as required by the Board of Vehicles Act. Ford contends that under the Act, the Board is required to issue a "final determination" within 120 days of the filing of a protest or any extension agreed to by the parties, and that determination must be in writing. The relevant provision of the Act provides:

Any hearing on a protest by a dealer of any action by a manufacturer alleged to be in violation of a provision of this act must be conducted and the final determination made within 120 days after the protest is filed. Unless waived by the parties, failure to do so will be deemed the equivalent of a determination that the manufacturer acted with good cause and, in the case of a protest of a proposed establishment or relocation of a dealer under section 10, that good cause does not exist for refusing to permit the proposed additional or relocated new vehicle dealer, unless such delay is caused by acts of the manufacturer or the additional or relocating dealer. Any parties to such a hearing shall have a right of review of the decision in a court of competent jurisdiction pursuant to 2 Pa.C.S. § 701 (relating to scope of subchapter). If the board determined that good cause does not exist for refusing to permit the proposed additional or relocated new ...


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