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decided: July 13, 1988.


Original Jurisdiction Appeal in the case of Commonwealth of Pennsylvania v. State Conference of State Police Lodges of the Fraternal Order of Police, by its Trustee Ad Litem, Paul McCommons, President.


Jerome J. Shestack, with him, James D. Crawford and Steve D. Shadowen, Schnader, Harrison, Segal & Lewis, and Frank A. Fisher, Jr., for petitioner.

Gary M. Lightman, with him, Anthony C. Busillo, II, for respondent.

Gregory R. Neuhauser, Deputy Attorney General, with him, Susan J. Forney, Senior Deputy Attorney General, John G. Knorr, III, Chief Deputy Attorney General, Chief, Litigation Section, and LeRoy S. Zimmerman, Attorney General, for intervenor, Attorney General.

President Judge Crumlish, Jr., and Judges Craig, MacPhail, Doyle, Barry, Colins and McGinley. Opinion by Judge Doyle. Dissenting and Concurring Opinion by Judge Craig. Judge Colins and Judge McGinley join in this dissenting and concurring opinion.

Author: Doyle

[ 117 Pa. Commw. Page 566]

Before this Court is a petition for review filed by Petitioner, the Commonwealth, which is addressed in part to our original jurisdiction and in part to our appellate jurisdiction. Count One, addressed to our original jurisdiction, alleges that the "neutral arbitrator," Arbitrator DiLauro, who was serving on an interest arbitration panel pursuant to the terms of the Act of June 24, 1968 (Act 111), P.L. 237, 43 P.S. §§ 217.1-217.10, was in fact not neutral and displayed "evident partiality in favor of the State Conference of State Police Lodges of the Fraternal Order of Police" (FOP), Respondent. These alleged improprieties were the basis of a dissenting opinion of the Commonwealth's arbitrator, Arbitrator Bray,

[ 117 Pa. Commw. Page 567]

    who, among his accusations, included the following in his dissenting opinion: that Arbitrator DiLauro admitted in a telephone conference with Bray that he had never reviewed transcripts or tapes for hearings at which he was not present; that Arbitrator DiLauro admitted in a telephone conference with Bray that after the hearings were closed he had read a newspaper article about the Governor's budget surplus which he thought would cover the award; that Arbitrator DiLauro admitted he depended upon "client acceptability" [presumably that of FOP] for his livelihood and had previously been "blacklisted" by FOP; that Arbitrator DiLauro had delivered the award to the FOP arbitrator before delivering it to Arbitrator Bray contrary to a previous agreement; that Arbitrator DiLauro had accepted FOP's proposals on essentially all issues.

The Commonwealth, based upon the statements in Arbitrator Bray's opinion, has requested in Count One of its Petition that we vacate the arbitration award in its entirety.

With respect to Count One only, FOP has filed a motion for judgment on the pleadings and a motion for summary judgment. Judge McGinley of this Court stayed depositions and all other discovery pertaining to Arbitrator DiLauro. In virtually identically worded motions FOP contends that the Commonwealth was aware of any alleged bias because of comments among or between the arbitrators during the proceedings. It thus reasons that because the Commonwealth made no protest then it has waived its right to do so, or that it is estopped from doing so, or that it is guilty of laches. The Commonwealth contends, however, that the comments made during the proceedings were themselves innocuous and that, in any event, their significance did not come to light until it had received Arbitrator Bray's dissenting opinion. It thus asserts that it should not be prevented from raising this issue.

[ 117 Pa. Commw. Page 568]

In ruling upon a motion for judgment on the pleadings we must take as true all of the allegations in the nonmoving party's pleadings and must consider the allegations in the light most favorable to the nonmoving party. Bata v. Central-Penn National Bank of Philadelphia, 423 Pa. 373, 224 A.2d 174 (1966), cert. denied, 386 U.S. 1007 (1967). Such motion may be granted only in cases which are free from doubt and where a trial would be fruitless. Id. It is clear to this Court that the Commonwealth vigorously disputes, if not that certain remarks were made at the hearing, at least that the significance of those remarks was then apparent. Further, the Commonwealth could not have known until Arbitrator Bray's decision that Arbitrator DiLauro had relied upon an ex parte newspaper article and had not reviewed transcripts of the proceedings. The FOP argues that the Commonwealth has offered no explanation "as to why its duly, designated representative failed to raise and/or preserve any of the issues . . . by placing them on the record." This evinces a confusion between the Commonwealth as a party and the arbitrator it designated to a tripartite board of arbitration, and City of Scranton Appeal, 59 Pa. Commonwealth Ct. 141, 428 A.2d 1048 (1981), urged by the FOP as controlling law, is simply inapposite. While the designated employer-employee arbitrators are not expected to be neutral -- indeed, they actually represent the interests of their respective parties, Borough of New Cumberland v. Police Employees of the Borough of New Cumberland, 503 Pa. 16, 467 A.2d 1294 (1983), the party which a particular arbitrator represents is not chargeable with its arbitrator's intimate knowledge of the tripartite board's deliberations. The third arbitrator is, of course, expected to be impartial. Id. at 21-22, 67 A.2d at 1297. Such being the case, and taking as true the Commonwealth's pleadings, we shall, accordingly, deny FOP's motion for judgment on the pleadings.

[ 117 Pa. Commw. Page 569]

Summary judgment may be entered when there is no issue of material fact in dispute. Pa. R.C.P. No. 1035. The moving party must be entitled to judgment as a matter of law. Id. Here it is disputed that the Commonwealth understood the significance of Arbitrator DiLauro's remarks or even how they were made. That is a critical point since if the remarks were unknown or seemed innocuous there would be no reason for protest. Accordingly, we shall deny FOP's motion for summary judgment.

Although we are denying the motions of FOP we shall not, nor can we, at this juncture, vacate the entire award. This Court is aware of the enormous sums of money at issue here. The award provides State Police with a wage and benefit increase of over fifty million dollars resulting in approximately a forty percent increase in payroll costs over the next two years. We note that the expiration date of the present contract is June 30, 1988. Further, it is obvious that massive amounts of paper work will be necessary to implement the new award. Accordingly, because of the exigencies of the situation, we shall proceed to deal with the merits of the award which have been presented to us under our appellate jurisdiction. We make it clear, however, that this in no way forestalls further proceedings in this Court's original jurisdiction. We thus proceed to review those portions of the award which the Commonwealth appeals.

Our review of Act 111 interest arbitration cases is in the nature of a narrow certiorari and is limited to questions concerning the jurisdiction of the arbitrators, the regularity of the proceedings, questions involving an excess in the exercise of the arbitrator's powers, and constitutional questions. Appeal of Upper Providence Police of Delaware County, 514 Pa. 501, 526 A.2d 315 (1987). With this limited scope of review in mind we shall address

[ 117 Pa. Commw. Page 570]

    the challenges to the various portions of the award.

The Pension Provision

This portion of the award provided:

Notwithstanding anything herein to the contrary, a member, regardless of age, may also retire on or after July 1, 1989 with all health benefits that are currently carried into retirement under the following conditions:

(a) At 50% of the highest year salary after 20 years of service; or

(b) At 75% of the highest year salary after 25 years of service.

The Commonwealth contends that an award of increased pension benefits is expressly prohibited by Section 5955 of the Retirement Code, 71 Pa. C. S. § 5955. ...

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