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Mark v. Borough of Hatboro

filed: March 31, 1995.

JOHN D. MARK, APPELLANT
v.
BOROUGH OF HATBORO, THOMAS E. MCMACKIN, CHARLES J. ACKER, BUCKY L. CLARK, ROBERT S. DOORLEY, DOTTIE NEWSOME, JOHN G. YOUNGLOVE, ESQUIRE, ALFRED F. ZOLLERS, ROBERT STAUCH, MICHAEL BARGER ROY THOMAS, JOSEPH READING, JOHN SINE, WILLIAM MARLEY, III, ENTERPRISE FIRE COMPANY



On Appeal from the United States District Court for the Eastern District of Pennsylvania. (D.C. No. 92-cv-7354).

Before: Greenberg, Sarokin, and Weis, Circuit Judges.

Author: Greenberg

Opinion OF THE COURT

GREENBERG, Circuit Judge.

I. Introduction

On March 5, 1991, defendant William Marley III, a member of the Enterprise Fire Company, a volunteer fire company in the Borough of Hatboro, Pennsylvania, set fire to and destroyed plaintiff John D. Mark's automobile repair business. The question on this appeal is whether the Borough and Enterprise can be held liable under 42 U.S.C. § 1983, the federal civil rights statute, for damages resulting from the arson. The district court granted defendants' motions for summary judgment, basing the decision on its finding that Enterprise was not a state actor for section 1983 purposes, and that it operates independently of the Borough. We conclude that the district court erred in holding that Enterprise is not a state actor. Nonetheless, our review of the record compels the Conclusion that the defendants cannot be held responsible under section 1983 for the harm that occurred.*fn1 We, therefore, will affirm the grant of summary judgment.

II. Factual background and procedural history

Enterprise is a private association of volunteers which has served the Borough of Hatboro since 1890. Mark v. Borough of Hatboro, 856 F. Supp. 966, 968 (E.D. Pa. 1994). In its day to day operations, Enterprise essentially acts autonomously; it owns the fire station and the fire fighting equipment, elects its own officers, prepares its own budget and maintains its own recruitment and training practices. However, on September 28, 1987, Enterprise signed an agreement with the Borough, agreeing to provide fire protection services to the Borough in return for the latter's imposition of a fire tax. The Borough insures Enterprise's equipment, and the fire tax funds Enterprise's operations and expenditures. Id. at 973-74.

According to Enterprise's by-laws (as of June 16, 1989), "any person shall be eligible to be a regular member of the Company if they are eighteen (18) years of age or older and they are of good moral character." Enterprise Fire Company of Hatboro, Pennsylvania By-Laws at app. 59. The by-laws provide the following procedure for admitting an applicant to membership:

(1) An application for regular member [sic] must be made in writing on forms provided by [Enterprise]. The applicant must submit the completed form co-signed by a regular member in 'good standing' who shall be considered the 'proposing member'. A fee of three ($3.00) dollars shall accompany the application.

(2) The Membership Committee shall be in charge of membership and they shall be responsible for the production, distribution and receipt of completed application forms and fees.

(3) Following the submission of the completed application and payment of the fee the Membership Committee shall arrange for the applicant and proposing member to attend the next regular membership meeting when both parties are available.

(4) The applicant and proposing member shall appear at the regular membership meeting at which time the Membership Committee shall introduce the applicant to the regular membership. The application shall then be referred to the Membership Committee for an investigation and recommendation for 'probationary membership'.

(5) At the subsequent regular membership meeting the Membership Committee shall report on the application. If a 'favorable report' is submitted than [sic] the regular membership shall vote to determine whether the applicant shall be accepted for 'probationary membership.' Said vote shall be made by the show of hands and three (3) or more negative votes shall be necessary to defeat the application . . . .

By-laws at app. 59-60. The application is a two-page questionnaire that asks, among other things, whether the applicant has "every [sic] been under the care of or committed to any institution for any nervous condition, mental illness, alcoholism or use of drugs." App. 1-2.

Marley filled out and signed the application on May 9, 1986, and answered "no" to the foregoing question. Id. On May 19, 1986, Enterprise made him a probationary member, and it appears that in May, 1988 he became a regular member. Id. at 1.*fn2 It is undisputed that prior to the Mark fire, Enterprise "never considered the need for psychological testing to identify firefighters having a propensity to commit arson. . . . Neither did it receive any advice as to whether existing members or applicants for firefighter status could be identified as potential arsonists." Brief of Enterprise Fire Company at 10. According to Mark's interpretation of expert reports, however, Marley had a psychologically troubled background which would have indicated to trained observers that he was not fit to be a firefighter. Additionally, while working as a volunteer firefighter, Marley had a serious drinking problem and, on one occasion, "was cautioned by other members to stay away from the fire officers at the scene [of a fire] because he smelled so strongly of alcohol." Supplemental Statement of Dian Williams, President of Center for Arson Research, July 11, 1993 at app. 946.

On December 23, 1992, Mark filed a complaint against the Borough, several Borough officials, and Enterprise in the United States District Court for the Eastern District of Pennsylvania to recover his losses from the fire.*fn3 His complaint alleged that Enterprise's and the Borough's failure to follow adequate policies to ensure that applicants to the fire department were screened sufficiently for tendencies towards arson caused the damage to his property.*fn4 Mark claimed that this duty to screen is compelled constitutionally, and that the danger of volunteer firefighters committing arson is so grave and so obvious that the defendants' failure to follow such a policy evinced willful disregard for the rights of individuals with whom the firefighters came in contact. Mark further alleged that if Enterprise had a policy of psychologically screening applicants or of training its firemen to spot potential arsonists, it would have discovered that Marley was unfit to serve as a volunteer firefighter and it never would have admitted him into membership, so that Marley would not have started the fire. Mark claimed relief pursuant to 42 U.S.C. § 1983 and under state law. The parties have considered the Borough officials on the same basis as the Borough itself, and consequently we shall treat this case as involving only two defendants, Enterprise and the Borough.*fn5

On February 25, 1993, the Borough moved to dismiss the complaint pursuant to Fed. R. Civ. P. 12(b)(6), for failure to state a claim upon which relief could be granted. On March 2, 1993, Enterprise made a similar motion. On April 8, 1993, the district court granted Enterprise's motion to dismiss counts 2 and 3, which alleged, respectively, negligence and willful and wanton conduct, but the district court denied the remainder of the motions.

On December 28, 1993, the defendants moved for summary judgment pursuant to Fed. R. Civ. P. 56(b). In their motion papers, they made a series of alternative arguments, including the following: (1) Enterprise was not a state actor for section 1983 purposes, and therefore Mark had no federal cause of action; (2) the Due Process Clause of the Fourteenth Amendment imposes no duty upon local governments to provide adequate fire protection or to protect the public from fire; (3) no local governmental entity has a due process duty to protect the public against violent acts of private persons; (4) even if Mark's constitutional rights were violated, he failed to demonstrate that the defendants' failure to screen applicants psychologically for membership evinced deliberate indifference; (5) the causal link between the failure to screen and the arson was too remote to support the imposition of liability.

In an opinion and order dated June 30, 1994, reported at 856 F. Supp. 966 (E.D. Pa. 1994), the district court granted defendants' motion. The court first addressed the state actor argument, and found that firefighting in Pennsylvania never has been an exclusive function of the government, and that there is an insufficient connection between the municipality and Enterprise to justify imposing state actor status on Enterprise. Id. at 970-76. It went on to reason that "since [the Borough] has no control over [Enterprise's] employment practices in the first place, and since [Enterprise's] acts do not fairly represent official policy, the Borough's policy or lack of policy regarding [Enterprise's] screening of new applicants is not actionable under § 1983." Id. at 976. Upon dismissing the federal claims against both the Borough and Enterprise, pursuant to 28 U.S.C. § 1367(c)(3) the district court declined to exercise supplemental jurisdiction over the remaining state law claims, and thus it dismissed those claims without prejudice.

Mark filed a timely notice of appeal from the district court's order. We have jurisdiction pursuant to 28 U.S.C. § 1291, as the appeal is from a final order disposing of all claims in the complaint. The district court had jurisdiction pursuant to 28 U.S.C. §§ 1331 and 1343. We exercise plenary review over the district court's grant of summary judgment. Allegheny Int'l, Inc. v. Allegheny Ludlum Steel Corp., 40 F.3d 1416, 1423 (3d Cir. 1994). Thus, "we must determine whether 'the pleadings, depositions, answers to interrogatories, and admissions on file, together with the affidavits, if any, show that there is no genuine issue as to any material fact and that [the moving party] is entitled to a judgment as a matter of law.'" Id. at 1423 (quoting Fed. R. Civ. P. 56(c)). As we recently described:

'In applying this standard, "all inferences must be drawn against the movant, . . . and in favor of the nonmovant."' [FDIC v. Bathgate, 27 F.3d 850, 860 (3d Cir. 1994)] (quoting Erie Telecommunications, Inc. v. City of Erie, 853 F.2d 1084, 1093 (3d Cir. 1988)). However, '"where the movant has produced evidence in support of its motion for summary judgment, the nonmovant cannot rest on the allegations of pleadings and must do more than create some metaphysical doubt."' Id. (quoting [Petruzzi's IGA Supermarkets, Inc. v. Darling-Delaware Co., 998 F.2d 1224, 1230 (3d Cir.), cert. denied, 114 S. Ct. 554 (1993)]).

40 F.3d at 1423.

III. Discussion

In cases involving the scope of liability under a federal statute, it always is appropriate to begin with the statutory language. 42 U.S.C. § 1983 provides in pertinent part that:

Every person who, under color of any statute, ordinance, regulation, custom, or usage, of any State or Territory, subjects, or causes to be subjected, any citizen of the United States or other person within the jurisdiction thereof to the deprivation of any rights, privileges, or immunities secured by the Constitution and laws, shall be liable to the party injured in an action at law, suit in equity, or other proper proceeding for redress.

"By its terms, of course, the statute creates no substantive rights; it merely provides remedies for deprivations of rights established elsewhere." City of Oklahoma City v. Tuttle, 471 U.S. 808, 816, 105 S. Ct. 2427, 2432, 85 L. Ed. 2d 791 (1985) (plurality opinion). Thus, "to establish a claim under 42 U.S.C. § 1983, [a plaintiff] must demonstrate a violation of a right secured by the Constitution and the laws of the United States [and] that the alleged deprivation was committed by a person acting under color of state law." Moore v. Tartler, 986 F.2d 682, 685 (3d Cir. 1993). Here, Mark claims that he was deprived of his substantive due process rights guaranteed by the Fourteenth Amendment. The district court opinion focused principally on whether Enterprise could be considered a state actor for section 1983 purposes. That is where, then, we will begin our analysis.

A. Is Enterprise a State Actor ?

"Although a private [party] may cause a deprivation of . . . a right, [it] may be subjected to liability under § 1983 only when [it] does so under color of law." Flagg Bros., Inc. v. Brooks, 436 U.S. 149, 156, 98 S. Ct. 1729, 1733, 56 L. Ed. 2d 185 (1978). The Supreme Court has clarified that "in cases under § 1983, 'under color' of law has consistently been treated as the same thing as the 'state action' required under the Fourteenth Amendment." United States v. Price, 383 U.S. 787, 794 n.7, 86 S. Ct. 1152, 1157 n.7, 16 L. Ed. 2d 267 (1966) (quoted in Lugar v. Edmondson Oil Co., 457 U.S. 922, 928, 102 S. Ct. 2744, 2749, 73 L. Ed. 2d 482 (1982) [hereinafter "Lugar "]), and Rendell-Baker v. Kohn, 457 U.S. 830, 838, 102 S. Ct. 2764, 2769-70, 73 L. Ed. 2d 418 (1982). The state action principle is stated succinctly as follows: "At base, 'constitutional standards are invoked only when it can be said that the [government] is responsible for the specific conduct of which the plaintiff complains.'" Edmonson v. Leesville Concrete Co., 500 U.S. 614, 632, 111 S. Ct. 2077, 2089, 114 L. Ed. 2d 660 (1991) [hereinafter "Edmonson "] (O'Connor, J. Dissenting) (quoting Blum v. Yaretsky, 457 U.S. 991, 1004, 102 S. Ct. 2777, 2785-86, 73 L. Ed. 2d 534 (1982)) (alterations in original). Put differently, deciding whether there has been state action requires an inquiry into whether "there is a sufficiently close nexus between the State and the challenged action of [Enterprise] so that the action of the latter may be fairly treated as that of the State itself." Blum v. Yaretsky , 457 U.S. at 1004, 102 S. Ct. at 2786 (internal citation omitted).

The Supreme Court in varying circumstances appears to utilize three discrete tests to determine whether there has been state action. See Haavistola v. Community Fire Co. of Rising Sun, 6 F.3d 211, 215 (4th Cir. 1993). The first inquiry asks whether "the private entity has exercised powers that are traditionally the exclusive prerogative of the state." Blum v. Yaretsky, 457 U.S. at 1004-05, 102 S. Ct. at 2786 (emphasis added) (internal citation omitted). Years ago, the Court applied this test somewhat liberally, holding, for example, that a town owned by a private company performs a public function and therefore is a state actor, see Marsh v. Alabama, 326 U.S. 501, 507, 66 S. Ct. 276, 279, 90 L. Ed. 265 (1946), and that a private organization conducting pre-primary elections for the purpose of sending its candidates to the primary election, engaged in an exclusive public function. Terry v. Adams, 345 U.S. 461, 73 S. Ct. 809, 97 L. Ed. 1152 (1953). See also Evans v. Newton, 382 U.S. 296, 86 S. Ct. 486, 15 L. Ed. 2d 373 (1966) (public park could not be operated with racial restriction even when trustees had no connection to city government).

However, the Court came increasingly to emphasize the "exclusivity" aspect of the test, and rarely found that plaintiffs had met that rigorous standard. Thus, in Jackson v. Metropolitan Edison Co., 419 U.S. 345, 95 S. Ct. 449, 42 L. Ed. 2d 477 (1974), the Court held that a private utility company, extensively regulated by the state, and apparently holding at least a partial monopoly in its territory, did not act under color of state law, in part because the state where the utility was engaged in business had "rejected the contention that the furnishing of utility services is either a state function or a municipal duty." Id. at 353, 95 S. Ct. at 454. Similarly, in Rendell-Baker v. Kohn, the Court held that a private entity engaged in the education of maladjusted high school students did not perform an exclusively public function because "[the state's] legislative policy choice [to fund the private school] in no way makes these services the exclusive province of the State." 457 U.S. at 842, 102 S. Ct. at 2772; see ...


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