For the reasons which follow, we will enter an order granting defendants' motion in part and dismissing Counts II, III and V. Counts I and IV remain in the case, as does plaintiff's claim for punitive damages.
Rule 12(b)(6) motion
In deciding defendants' motion, we are "required to accept as true all allegations in the complaint and all reasonable inferences that can be drawn from them after construing them in the light most favorable to the non-movant." Jordan v. Fox, Rothschild, O'Brien & Frankel, Inc., 20 F.3d 1250, 1261 (3d Cir. 1994). "In determining whether a claim should be dismissed under Rule 12(b)(6)," we look "only to the facts alleged in the complaint and its attachments without reference to other partes of the record." Id. Dismissal is not appropriate unless "it clearly appears that no relief can be granted under any set of facts that could be proved consistently with the plaintiff's allegations." Id.
Asserted property interest in remaining Chief of Police
The claims asserted in Counts II, III and V of plaintiff's complaint rise or fall on plaintiff's ability to demonstrate a property interest under Pennsylvania law in remaining Chief of Police. In view of the overarching significance of that issue, we address it first.
Establishing a property interest requires a showing that the plaintiff has "a legitimate claim of entitlement" in the position or rights which he claims were denied him. Fratantaro v. Kepler, 1992 U.S. Dist. LEXIS 377, 1992 WL 6754 at * 3 (E.D.Pa. Jan. 14, 1992), citing Board of Regents v. Roth, 408 U.S. 564, 577, 33 L. Ed. 2d 548, 92 S. Ct. 2701 (1972). It requires something more than a showing of expectation or desire. Id.
As a general rule, municipal employees in Pennsylvania are employees at-will. The municipality that hires them has the right to terminate their employment for any or no reason so long as the motives are not discriminatory under federal or state law. Fratantaro, 1992 U.S. Dist. LEXIS 377, 1992 WL 6754 at * 3, citing Burns v. County of Cambria, 764 F. Supp. 1031, 1040 (W.D.Pa. 1991), 971 F.2d 1015 (3d Cir. 1992), cert. denied sub nom, Roberts v. Mutsko, 506 U.S. 1081, 122 L. Ed. 2d 357, 113 S. Ct. 1049 (1993). At-will employees can demonstrate a property interest in retaining their jobs only by showing an enforceable expectation of continued employment, Abraham v. Pekarski, 537 F. Supp. 858 (E.D.Pa. 1982), aff'd in part, 728 F.2d 167 (3d Cir.), cert. denied, 467 U.S. 1242 (1984), or "'some form of guarantee'" of continued employment extended by the employing municipality. Appeal of Colban, 58 Pa. Commw. 104, 427 A.2d 313 (Pa. Cmwlth. Ct. 1981), citing McCorkle v. Bellefonte Area Board of School Directors, 41 Pa. Commw. 581, 401 A.2d 371, 374 (Pa.Cmwlth. 1979) and Fair v. Delaney, 35 Pa. Commw. 103, 385 A.2d 601 (Pa. Cmwlth. Ct. 1978).
Shoemaker bases his claim of a property interest on the terms of his employment agreement with the city. The agreement provided that during the probationary period, he could be demoted only for "just cause." (Plaintiff's complaint, exhibit "A") This guarantee, he claims, gave him a legitimate expectation that he would remain Chief of Police absent "just cause" for his demotion.
Were it not for the fact that we find the agreement unenforceable for the reasons discussed below, we would agree with the plaintiff and have no difficulty finding that he had the requisite property interest in remaining Chief of Police. See: Unger v. National Residents Matching Program, 928 F.2d 1392, 1399 (3d Cir. 1991) (finding that a property interest may arise where a state entity can terminate employment only for cause). Cf. Sasko v. Charleroi Area School District, 121 Pa. Commw. 220, 550 A.2d 296, 299 (Pa. Cmwlth. Ct. 1988).
Citing Bolduc v. Board of Supervisors of Lower Paxton Township, 152 Pa. Commw. 248, 618 A.2d 1188 (Pa. Cmwlth. Ct. 1992), appeal denied, 533 Pa. 662, 625 A.2d 1195 (Pa. 1993), defendants argue that plaintiff's employment contract with the city was void from the outset to the extent that it guaranteed him a right to remain Chief of Police for a specified period. See also: 53 Pa. Stat. Ann. tit. 53, §§ 37002 and 41305. Defendants argue that the city has no authority under Pennsylvania law to extend such a commitment, and that the city's promise of continued employment is void and unenforceable under Pennsylvania law.
It is true, as defendants argue, that in Pennsylvania, a public employer, in this case, the City of Lock Haven, has the authority to enter into an employment agreement for a time certain only if the Pennsylvania legislature has authorized it to do so. Otherwise, such authority is absent, and a purported promise of employment for a definite period is unenforceable. Bolduc, 618 A.2d at 1190, citing Scott v. Philadelphia Parking Authority, 402 Pa. 151, 166 A.2d 278 (Pa. 1960) and Mahoney v. Philadelphia Housing Authority, 13 Pa. Commw. 243, 320 A.2d 459 (Pa. Cmwlth. Ct. 1974) (absent authorization in the Housing Authorities Law, Pa. Stat. Ann. tit. 35 §§ 1541 et seq. to create tenure by contract, housing authority employees could be dismissed without cause or prior notice, despite existence of a personnel policy that dismissals would occur only for cause and after notice.), cert. denied, 419 U.S. 1122, 42 L. Ed. 2d 822, 95 S. Ct. 806 (1975). See also: Abraham v. Pekarski, 537 F. Supp. 858 (E.D.Pa. 1982), aff'd in part, 728 F.2d 167 (3d Cir. 1984), cert. denied, 467 U.S. 1242 (1984) (at will employment relationship inconsistent with a property right based upon an enforceable expectation of continued employment.)
Authority to contract for employment for a time certain must be expressly granted by the Pennsylvania legislature. Cooley v. Pennsylvania Housing Finance Agency, 830 F.2d 469, 471 (3d Cir. 1987); Stumpp v. Stroudsburg Municipal Authority, 658 A.2d 333, 334 (Pa. 1995) and Pivarnik v. Commonwealth, Department of Transportation, 82 Pa. Commw. 42, 474 A.2d 732, 734 (Pa. Cmwlth. Ct. 1984). A general grant, for example, of such powers as are necessary to carry out essential functions of the municipality is insufficient. For examples of sufficiently specific grants of authority, see, e.g, the Civil Service Act, Pa. Stat. Ann. tit. 71, §§ 741.1-741.1005; the Public Employees Relations Act, 43 Pa. Cons. Stat. Ann. §§ 1101.101-1101.2301; and the teachers tenure provisions of the Public School Code of 1949, as amended, 24 Pa. Cons. Stat. Ann. §§ 11-1121-11-1141.
The Pennsylvania Supreme Court held in Scott that a grant of broad general powers in the enabling legislation of the Philadelphia Parking Authority, 53 P.S. §§ 341-356, was insufficient to give it the right to contract with employees for a term certain. On that basis, the court held unenforceable an authority employee's purported contract for employment for a time certain.
The Third Circuit Court of Appeals reached the same conclusion with respect to an employee of the Pennsylvania Housing Finance Agency (PHFA) in Cooley, 830 F.2d at 471. The court held insufficiently specific general provisions in the agency's enabling legislation, 35 Pa.Cons. Stat. Ann. § 1680.101 et seq, and, on that basis, ruled that the plaintiff had no enforceable right to continued employment with the agency. Although the enabling legislation specifically authorized PHFA to "enter into contracts of all kinds and to execute all instruments necessary or convenient for carrying on its operations...employ an executive director and other officers, agents, employees, professional and business advisors as may from time to time be necessary in its judgment and to fix their compensation; and to promote and discharge such officers, employees, and agents...[and]...to do all things necessary or convenient to carry out the powers granted by this act or other acts," 35 Pa. Cons. Stat. Ann. § 1680.205, the court held this was insufficiently specific to confer the right to hire employees for a time certain. The court stated:
Making contracts with its employees, affording them guarantees of continuity in their employment, is notably absent in the list of enunciated powers. Because of the long tradition of at-will public employment, it must be assumed that when the legislature speaks, it does so explicitly, and if, in their wisdom, it chose to grant tenure to the PHFA employees, it would have enacted an appropriate provision.
830 F.2d at 472.
Enabling legislation for the Redevelopment Authority was interpreted the same way by the United States District Court for the Eastern District of Pennsylvania in Banks v. Redevelopment Authority, 416 F. Supp. 72, 74 (E.D.Pa. 1976). The court held that the Philadelphia Redevelopment Authority "had no power to create rules which would prevent dismissal at will." The district court holding was affirmed on appeal, 556 F.2d 564 (3d Cir. 1977), cert. denied, 434 U.S. 929, 98 S. Ct. 414, 54 L. Ed. 2d 288 (1977). Compare: Perri v. Aytch, 724 F.2d 362, 364-66 (3d Cir. 1983) (grant of authority found).
Third Class City Charter Law
Lock Haven is a Pennsylvania Third Class City organized under the Optional Third Class City Charter Law (City Charter Law or the Act), 53 P.S. §§ 41101-41625. See: Eichenlaub v. City of Lock Haven, 84 Pa. Commw. 139, 478 A.2d 551, 552 (Pa. Cmwlth. Ct. 1984).
General powers are conferred in sections 303, 304 and 305 of the Act. Section 303 grants cities organized thereunder the power to: "organize and regulate its internal affairs and to establish, alter, and abolish offices, positions and employments and to define the functions, powers and duties thereof and fix their term, tenure and compensation ...." 53 P.S. § 41303(1).
Section 304 of the City Charter Law expands upon the powers granted, stating:
The general grant of municipal power contained in this article is intended to confer the greatest power of local self-government consistent with the Constitution of this State. Any specific enumeration of municipal powers contained in this act or in any other law shall not be construed in any way to limit the general description of power contained in this article, and any such specifically enumerated municipal powers shall be construed as in addition and supplementary to the powers conferred in general terms by this article. All grants of municipal power to cities governed by an optional plan under this act, whether in the form of specific enumeration or general terms, shall be liberally construed in favor of the city.