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Rendell v. Pennsylvania State Ethics Commission

IN THE SUPREME COURT OF PENNSYLVANIA MIDDLE DISTRICT


November 30, 2009

EDWARD G. RENDELL, GOVERNOR OF PENNSYLVANIA, AND JOHN QUIGLEY, ACTING PENNSYLVANIA SECRETARY OF CONSERVATION AND NATURAL RESOURCES, APPELLEES
v.
PENNSYLVANIA STATE ETHICS COMMISSION, APPELLANT
EDWARD G. RENDELL, GOVERNOR OF PENNSYLVANIA, AND JOHN HANGER, ACTING PENNSYLVANIA SECRETARY OF ENVIRONMENTAL PROTECTION, APPELLEES
v.
PENNSYLVANIA STATE ETHICS COMMISSION, APPELLANT

Appeal from the Order of the Commonwealth Court at Nos. 268 & 269 MD 2007 dated 10/03/08.

The opinion of the court was delivered by: Mr. Justice Saylor

CASTILLE, C.J., SAYLOR, EAKIN, BAER, TODD, McCAFFERY, GREENSPAN, JJ.

ARGUED: May 12, 2009

OPINION

This appeal concerns the issue of whether a non-profit corporation is a "business" as the term is defined in Pennsylvania's Public Official and Employee Ethics Act.*fn1

The Ethics Act, among other things, prohibits public officials from engaging in conduct that constitutes a conflict of interest. See 65 Pa.C.S. §1103(a). Such a conflict arises when a public official or public employee uses the authority of his or her office for the private pecuniary benefit of himself, a family member, or a "business with which he or a member of his immediate family is associated." 65 Pa.C.S. §1102. The act defines "business" as:

Any corporation, partnership, sole proprietorship, firm, enterprise, franchise, association, organization, self-employed individual, holding company, joint stock company, receivership, trust or any legal entity organized for profit.

65 Pa.C.S. §1102.

In April 2007, Pennsylvania's General Counsel requested an advisory opinion or advice of counsel from the Pennsylvania State Ethics Commission, inquiring whether, under Section 1103(a) of the Ethics Act, the then-Secretary of the Department of Environmental Protection ("DEP") and Secretary of the Department of Conservation and Natural Resources ("DCNR") were required to recuse themselves from their respective departments' grant-making process due to potential conflicts of interest.*fn2 In DCNR's case, the Secretary's wife was employed by the Pennsylvania Horticultural Society, a non-profit organization that has received grant funding from the DCNR. In DEP's case, the Secretary's husband performed consulting work on projects receiving grants from the DEP. In both instances, the Governor's office believed that recusal was unnecessary, but sought an additional opinion or advice of counsel from the Commission. See 65 Pa.C.S. §1107(10), (11) (authorizing the Commission to provide advice and opinions on such matters).

In advisory opinions, the Commission concluded that both Secretaries would be in violation of the Ethics Act's conflict provision if they participated in their agencies' grant-making processes involving such entities. It recommended that, to avoid such a conflict, the Governor should appoint someone outside each Secretary's chain of command to take his or her place in that process. See In re DiBerardinis, Case No. 07-010 (Pa. Ethics Comm'n Apr. 30, 2007); In re McGinty, Case No. 07-009 (Pa. Ethics Comm'n Apr. 30, 2007).

Both Secretaries, together with the Governor (collectively, "Appellees"), filed petitions for review addressed to both the Commonwealth Court's appellate jurisdiction and to its original jurisdiction. The appellate-jurisdiction petitions sought review of the advisory opinions, alleging that the Commission had committed errors of law and that the opinions would disrupt the effective administration of state government. The original-jurisdiction petitions requested declaratory relief regarding a number of issues raised in the opinions. The Commission filed a motion to quash the appeals and preliminary objections. The petitions were then consolidated for disposition.

Initially, on December 19, 2007, the unanimous en banc Commonwealth Court, see Rendell v. State Ethics Comm'n, 938 A.2d 554 (Pa. Cmwlth. 2007), granted the Commission's motion to quash the appeal, granted the Commission's preliminary objections in part and denied them in part, and permitted the declaratory judgment action to go forward on two substantive questions, namely: (1) whether non-profit organizations are included in the definition of businesses under Section 1102 of the Ethics Act; and (2) whether, when a departmental head has a conflict of interest, the Governor must appoint someone outside the department head's chain of command to avoid the conflict. In response, Appellees and the Commission filed cross-motions for summary relief as to these issues.*fn3

On October 3, 2008, the en banc Commonwealth Court issued a published opinion and order, see Rendell v. State Ethics Comm'n, 961 A.2d 209 (Pa. Cmwlth. 2008), concluding that the term "business," as defined in the Ethics Act, excludes nonprofit entities. In reaching this conclusion, the court relied upon In re Nomination Pet. of Carroll, 586 Pa. 624, 896 A.2d 566 (2006), where this Court suggested that, in the context of required financial disclosures for election matters, a non-profit organization is not a business as defined by the Ethics Act.*fn4 In this respect, the court rejected the Commission's contention that Carroll was not controlling because it did not definitively hold that non-profits are not businesses under the Ethics Act. Although the Commonwealth Court agreed with the Commission that different policies underlie the Act's requirements in connection with candidates' financial interest statements and with the avoidance of conflicts by public officials, it noted that the term "business" is specifically defined in the Act and indicated that it was not free to disregard this Court's interpretation of that term as excluding non-profits. Thus, in view of precedent, the court granted summary relief to Appellees and denied it to the Commission, declaring that the Secretaries would not be under a conflict of interest. See Rendell, 961 A.2d at 216. In light of its disposition, the court declined to reach the second substantive issue --whether the act requires the Governor to appoint someone outside the department head's chain of command in the event of a conflict. See id. at 216 n.9.

Judge Cohn Jubelirer, joined by Judge Leavitt, filed a dissenting opinion, expressing that Carroll had declared "business" to be ambiguous on the issue of whether it included non-profits. The dissent stated that, in election matters, the Act must be read in pari materia with the Election Code, which tempers the definition of "business" to protect voter choice. Here, however, the salient rule of construction is that the Act, as remedial legislation, should be liberally construed to accomplish its goal of avoiding the appearance of impropriety. The dissent pointed out that employees and contractors of non-profit corporations may receive substantial pecuniary gain occasioned by a governmental grant, thus rendering the non-profit versus for-profit status of a corporation immaterial within the framework of the present issue. The dissent would thus have denied declaratory relief to Appellees on the question of the scope of the Act's definition of business. However, the dissent would have granted them relief on the issue of whether the Governor must appoint someone outside of the Secretary's chain of command to perform the grant-making function. In this latter respect, the dissent opined that the Secretary's personal recusal would be sufficient to avoid the conflict of interest, particularly as the Act does not impute a conflict based on a person's being in a chain of command. See id. at 217-19 (Cohn Jubelirer, J., dissenting).

The Commission filed a notice of appeal from the Commonwealth Court's order, limited to the issue of whether the court correctly interpreted "business" to exclude nonprofit entities, and probable jurisdiction was noted.

Presently, the Commission argues that, as remedial legislation designed to promote public trust in government, the Ethics Act should be liberally construed. See Maunus v. State Ethics Comm'n, 518 Pa. 592, 598-600, 544 A.2d 1324, 1327-28 (1988). More specifically, the Commission emphasizes that the General Assembly expressly declared in Section 1101.1(a) of the enactment that its purpose is to assure the citizens of Pennsylvania that the financial interests of their representatives and public servants will not conflict with their duties to the Commonwealth.*fn5 See Brief for Commission at 26. The Commission also argues that, on its face, Section 1102's definition of business expressly includes any corporation and any organization, without qualification. It submits that, in the final phrase of the definition ("or any legal entity organized for profit"), the "or" is disjunctive, and the independent use of the word "any" in this clause precludes an interpretation that would apply the "for profit" qualification to corporations and organizations. Further, the Commission avers that the qualifier "organized for profit" does not apply to "corporation" or "organization," because it does not extend to all of the other preceding entities listed in the definition. As an example, the Commission observes that receiverships are not organized for profit.

The Commission's argument with regard to Carroll is two-fold. First, it contends that the Court in Carroll had been erroneously misinformed that the Commission had no rulings as to whether non-profit entities were considered businesses under the act. Citing several of its previous rulings, the Commission submits that it has consistently interpreted the term "business" as it is defined in Section 1102 to include non-profit corporations and organizations. See Brief for Commission at 29-30. Alternatively, the Commission attempts to distinguish the holding in Carroll by arguing that the Carroll decision did not definitively decide the status of non-profits under the Ethics Act, particularly with respect to situations involving financial interests or relationships. Rather, this Court simply decided that any ambiguity in the definition of "business" should be construed most favorably to candidates seeking ballot access, and that it would not be a fatal defect to a candidate's nomination petition for the candidate to fail to disclose on his Statement of Financial Interests his involvement with a non-profit corporation from which he receives no compensation and that has nothing to do with his financial interests.

Id. at 34 (emphasis is removed). The Commission avers that this factual distinction renders Carroll inapposite to the instant matter. As such, the Commission maintains that Carroll should be distinguished as only applying to election cases involving a candidate's failure to disclose non-financial associations on a Statement of Financial Interests filed with nomination petitions.

In response, Appellees urge this Court to abide by its prior interpretation of the scope of the Ethics Act. In this regard, Appellees rely heavily on Carroll, which they view as holding definitively that Section 1102 excludes non-profit organizations from the statutory definition of "business." In addition to their more general stare decisis argument, Appellees contend that the plain language of the Ethics Act supports the conclusion that non-profit entities are not covered by the statute. Appellees argue that, when several words are followed by a modifying phrase, the natural construction of the language demands that the modifying phrase be read as applicable to all. See Brief for Appellees at 10 (citing Commonwealth v. Rosenbloom Fin. Corp., 457 Pa. 496, 500, 325 A.2d 907, 909 (1974)). Further, Appellees aver that there could be no legislative purpose in excluding only a single nebulous category of non-profit businesses, i.e. nonprofit "legal entities," while including within the act all other non-profit corporations. See id. at 13.

The issue for resolution is one of statutory interpretation; it is therefore a question of law subject to plenary review by this Court, in which our standard of review is de novo. See Gardner v. WCAB (Genesis Health Ventures), 585 Pa. 366, 372 n.4, 888 A.2d 758, 761 n.4 (2005).

In Carroll, this Court credited the candidate's argument that the Ethics Act, at its core, is designed to expose possible financial conflicts and, thereby, strengthen the citizens' faith and confidence in their government by assuring the impartiality of public officials. See Carroll, 586 Pa. at 631, 896 A.2d at 570. Accordingly, in determining whether the candidate's failure to disclose his unpaid directorship positions on the boards of two non-profit organizations constituted a fatal defect to his financial disclosure statement, the Court focused its attention most closely on the fact that no pecuniary or other material gain flowed from the candidate's positions with the organizations in question. In a footnote, the Court recognized that there were two possible interpretations of the term "business" as set forth in the act's definitional provision and stated generally that, to the extent the definitional language is ambiguous, it should be construed favorably to the candidate seeking office. See id. at 638 n.10, 896 A.2d at 574 n.10. However, the Court highlighted that the "distinct question" it was called upon to decide pertained to "whether and when a failure to disclose non-financial associations on a Statement of Financial Interests should trigger operation of the fatal defect rule." Id. at 637, 896 A.2d at 573 (emphasis in original). In the subsequent dispositional section of the decision, moreover, Carroll repeatedly stressed that the crux of the issue concerned the candidate's financial interests -- his compensation, or lack thereof -- in connection with the entity in question; the Court rarely, if ever, returned to the significance of the organizations' non-profit status in the context of the case. Thus, a close reading of Carroll reveals that the language pertaining to the scope of the term "business" was ancillary and, ultimately, unnecessary to the resolution of the controversy. As such, it constituted dicta and left open the question, for our present inquiry, whether the term "business" includes nonprofit corporations. See Barnes v. Alexander, 232 U.S. 117, 120, 34 S.Ct. 276, 277 (1914) (observing that certain remarks in a prior opinion "were not necessary to the decision... so that at least we are warranted in treating the question as at large"); see also S.E.C. v. Edwards, 540 U.S. 389, 396, 124 S.Ct. 892, 898 (2004); Commonwealth v. Singley, 582 Pa. 5, 15, 868 A.2d 403, 409 (2005) (citing Hunsberger v. Bender, 407 Pa. 185, 188, 180 A.2d 4, 6 (1962) (finding that a statement in prior opinion, which clearly was not decisional but merely dicta, "is not binding upon us")). See generally Storch v. Borough of Landsdowne, 239 Pa. 306, 308, 86 A. 861, 861 (1913) ("Courts only adjudicate issues directly raised by the facts in a case or necessary to a solution of the legal problems involved."); Cohens v. Virginia, 19 U.S. (6 Wheat.) 264, 399-400 (1821) (Marshall, C.J.) (explaining why dicta is not binding in subsequent cases).

We recognize that, in our subsequent per curiam Order in Pilchesky, this Court stated, in a summary fashion, that Carroll stood for the position that a non-profit organization does not constitute a business entity under the Ethics Act. See Pilchesky, 592 Pa. at 16 n.1, 922 A.2d at 877 n.1. The critical circumstance brought forward in that case, however, was that the individual seeking ballot access had failed to disclose his holdings in a financial institution organized for profit. Thus, any question of whether the Ethics Act's definition of "business" includes non-profits was necessarily nondispositional. Moreover, Pilchesky's characterization of Carroll does not reflect an in-depth analysis of the reasoning employed by that decision. Finally, it is worth noting that this Court did not have the benefit of the Commission's advocacy in either Carroll or Pilchesky and, thus, proceeded without guidance from the administrative agency charged with overseeing the implementation of the statute in question.*fn6

We agree with the suggestion from Carroll that the term "business" as contained in Section 1102 of the Ethics Act can reasonably be construed to either include or exclude non-profit entities. See Carroll, 586 Pa. at 638 n.10, 896 A.2d at 574 n.10. It is therefore ambiguous. See generally Trizechahn Gateway LLC v. Titus, ___ Pa. ___, ___, 976 A.2d 474, 483 (2009) (recognizing that an ambiguity exists when there are at least two reasonable interpretations of the text under review). Because of this ambiguity, we must reference principles of statutory construction to discern the legislative intent. See O'Rourke v. Commonwealth, 566 Pa. 161, 172, 778 A.2d 1194, 1201 (2001); see also 1 Pa.C.S. §1921(a) (providing that the object of all statutory construction is to ascertain and effectuate the intent of the General Assembly). In undertaking our analysis, we should not interpret statutory words in isolation, but must read them with reference to the context in which they appear. We may also consider other factors, such as: the mischief to be remedied; the object to be attained; and the consequences of a particular interpretation.

O'Rourke, 566 Pa. at 173, 778 A.2d at 1201 (citing Consulting Eng'rs Council of Pa. v. State Architects Licensure Bd., 522 Pa. 204, 208, 560 A.2d 1375, 1377 (1989), and 1 Pa.C.S. §§1921(c)(3), (4), (6)).

Certainly, Carroll's approach to Section 1102 of the Act was shaped in light of the harsh consequence that would result from an alternative interpretation, specifically, removal of a candidate from the ballot. Here, however, no such concern exists, and there are several equally compelling reasons to support the interpretation advocated by the Commission. For one, when interpreting the "organized for profit" qualifier in context, it is notable that the limitation appears at the end of the definition, and thus, under the last-antecedent principle of statutory construction as applied in other cases, see, e.g., McKinley v. PennDOT, 564 Pa. 565, 577 n.10, 769 A.2d 1153, 1160 n.10 (2001), it only to applies to the final item, "any legal entity." See generally Payless Shoesource Inc. v. Travelers Companies, Inc., 569 F. Supp. 2d 1189, 1197 (D. Kan. 2008) (suggesting that the last antecedent rule may be applied where the court finds the language to be ambiguous).*fn7 As such, the interpretation urged by Appellees would be problematic because it would apply the "organized for profit" qualifier to receiverships; such receiverships are not by nature organized for profit -- although theoretically they may generate a profit, at least in a generic sense (as Appellees point out) -- but rather, for the protection of an entity's assets and the ultimate distribution of those assets to creditors. See Commonwealth ex rel. Corbett v. Griffin, 596 Pa. 549, 559, 946 A.2d 668, 674 (2008) (rejecting the position that an end-of-list qualifier applied to all items in the list, because its application to one of the list's items would be improbable).

In addition, this construction aligns with the Ethics Act's status as remedial legislation designed to promote public trust in government, particularly with regard to the financial dealings of public officials. See In re Benninghoff, 578 Pa. 402, 409, 852 A.2d 1182, 1186 (2004) ("The obvious purpose of the Ethics Act is to mandate disclosure of the financial dealings of public officials."); Carroll, 586 Pa. at 637, 896 A.2d at 573 ("The intent and purpose of the Ethics Act is not shrouded in mystery."); see also 1 Pa.C.S. §1922(5) (providing that the General Assembly is presumed to intend to favor the public interest as against any private interest). In light of such a clear objective, it seems reasonable that a liberal interpretation of the term "business" is necessary to assure our citizens that the private financial interests of their public officials will not undermine the honest discharge of those officials' public duties. See 1 Pa.C.S. §1928(c); Maunus, 518 Pa. at 598-600, 544 A.2d at 1327-28 (reasoning that the purpose of the Ethics Act is to ensure the "integrity and honesty of employees of this Commonwealth"). For example, as the Commonwealth Court dissent developed:

It is inconsistent to allow one public official who earns $90,000 from a corporation as its employee or officer to conduct the Commonwealth's business with that corporation while a different public official earning a similar salary may not conduct Commonwealth business with a different corporation merely because one corporation is non-profit and the other is for-profit.

Rendell, 961 A.2d at 218 (Cohn Jubelirer, J. dissenting). Thus, regardless of whether the corporation receiving public funds is organized as a non-profit organization or a for-profit business, the appearance of impropriety would exist where a public official or his family member could realize a pecuniary gain from grants to such an entity if those grants stemmed from the public official's "use[of] the authority of his [or her] office." 65 Pa.C.S. §1102.

As a final matter, this interpretation is consistent with the Commission's understanding of Section 1102, which, under the prevailing Pennsylvania law, is entitled to deference. See generally Winslow-Quattlebaum v. Maryland Ins. Group, 561 Pa. 629, 635, 752 A.2d 878, 881 (2000) (explaining that, when construing statutory language, courts are to afford substantial deference to the interpretation rendered by the agency charged with its administration).*fn8

Accordingly, when we consider the "organized for profit" limitation in context of the definitional language as a whole and in light of the legislative objectives of the statute pertaining to the avoidance of impropriety or the appearance of impropriety, we ultimately conclude that the term "business," as defined by Section 1102 of the Ethics Act, should be interpreted to include non-profit entities.

In concurrence, Madame Justice Greenspan appears to agree with our decision on its merits, but, although the parties do not raise prudential considerations, she would invoke such concerns sua sponte and deny review. The first set of these is couched, in the concurring opinion, under the general rubric of "case or controversy" and "justiciability." See Concurring and Dissenting Opinion, slip op. at 2 & n.2.*fn9

Several discrete doctrines -- including standing, ripeness, and mootness -- have evolved to give body to the general notions of case or controversy and justiciability. Cf. Allen v. Wright, 468 U.S. 737, 750, 104 S.Ct. 3315, 3324 (1984) (identifying standing, ripeness, mootness, and political question, as "doctrines that cluster about [the] Article III" case or controversy requirement (citation omitted)).*fn10 Under prevailing Pennsylvania law, however, the matter of standing is not available to be raised by a court sua sponte. See In re Nomination Petition of DeYoung, 588 Pa. 194, 201, 903 A.2d 1164, 1168 (2006) ("This Court has consistently held that a court is prohibited from raising the issue of standing sua sponte.").

Here, other than the matter of asserted mootness, the bulk of the concerns raised in the concurrence -- including the allusions to advisory opinions and hypothetical versus concrete impact -- fall within the umbrella of the standing doctrine as it is understood in Pennsylvania. See, e.g., Pittsburgh Palisades Park, LLC, v. Commonwealth, 585 Pa. 196, 203, 888 A.2d 655, 659 (2005) ("The courts in our Commonwealth do not render decisions in the abstract or offer purely advisory opinions; consistent therewith, the requirement of standing arises from the principle that judicial intervention is appropriate only when the underlying controversy is real and concrete[.]" (internal quotation marks and modifications omitted)). Thus, under this Court's case-or- controversy jurisprudence as it stands, these concerns simply are not available for consideration at this time, since they have not been raised by any of the parties.*fn11

The second strand of case-or-controversy jurisprudence, ripeness, overlaps substantially with standing. See generally Socialist Workers Party v. Leahy, 145 F.3d 1240, 1244 -1245 (11th Cir. 1998) ("In cases involving pre-enforcement challenges such as this one, we have previously noted that the lines among the justiciability doctrines tend to blur.").*fn12 Our approach would be peculiar indeed if we were to maintain that the components of the standing doctrine discussed above (including advisory-opinion and hypothetical-versus-concrete aspects) are unavailable for sua sponte consideration by the courts, yet nonetheless may be considered sua sponte by simply restyling them as ripeness (or, more generally, case-or-controversy or justiciability) concerns.*fn13

Contrary to Justice Greenspan's perspective, we do not "implicitly overrule the long line of Pennsylvania Supreme Court decisions that have denied parties relief in the form of advisory opinions under the Declaratory Judgment Act." Concurring Opinion, slip op. at 6 n.8. Rather, we merely decide the discrete legal issue presented to us by the parties in this appeal and abide by the existing limitations on sua sponte judicial review.

Justice Greenspan also raises the issue of mootness, although it also has not been raised by the parties. See Concurring Opinion, slip op. at 7. We recognize that this Court has in the past considered such concerns of its own accord. See, e.g., In re Estate of Baeher, 533 Pa. 70, 618 A.2d 944 (1993) (per curiam). The Court has never indicated, however, that it is obliged to search outside the record to invoke the mootness doctrine sua sponte, and we decline to do so here.

In this case, we have before us a narrow, focused, purely legal issue in sharp controversy between Appellees, including the Chief Executive Officer of Pennsylvania, and the independent administrative agency charged with enforcement responsibility relative to ethical obligations of government officials. Cf. In re Gross, 476 Pa. 203, 210-11, 382 A.2d 116, 120 (2002) (expressing the Court's special reluctance to consider moot questions which raise constitutional issues). The Governor has asserted that the scope of the issue extends well beyond the immediately affected parties. The question presented has been fully developed in the Commonwealth Court, culminating in a published opinion which all Justices agree warrants correction, and in this Court via able advocacy. The extra-record factual circumstances raised by Justice Greenspan have no impact on the salient legal analysis, or on the Governor's more abstract claim of standing, to which any challenge has been waived. The subject is an important provision of the Ethics Act, which emphasizes maintenance of the public trust and the need for clear guidelines to direct public officials and employees in their actions. See 65 Pa.C.S. §1101.1(a) ("[T]he General Assembly by this chapter intends to define as clearly as possible those areas which represent conflict with the public trust.").

Despite the Legislature's manifest intent for clarity, we have determined (and Justice Greenspan apparently agrees) that the provision of the Ethics Act under review is materially ambiguous. The procedure advocated by Justice Greenspan for achieving clarity through the courts (which are charged with the interpretation of legislative enactments) entails requiring public officials to expose themselves to ethical investigation and possible civil fines, criminal penalties, see 65 Pa.C.S. §1109(a), and removal from office or termination from employment, 4 Pa. Code §7.173, in order to secure meaningful review.

In such circumstances, we decline to reach outside the record to assess the degree to which the ongoing controversy arising out of the clear and well developed differences between the Governor of Pennsylvania and the State Ethics Commission is presently acute. Indeed, were we to do so, it appears the litigants might lay good claim to the availability of the great-public-importance or capable-of-repetition-yet-evading-review exceptions to the mootness doctrine. See Pap's A.M. v. City of Erie, 571 Pa. 375, 391, 812 A.2d 591, 600-01 (2002) (alluding to the great-public-importance exception, particularly in light of a material lack of clarity in governing law); Consumers Educ. and Protective Ass'n v. Nolan, 470 Pa. 372, 383, 368 A.2d 675, 681 (1977) (declining to dismiss a declaratory judgment action on mootness grounds despite the expiration of the term for which one claiming the status of an administrative commissioner, explaining "we conclude that the [legal issue surrounding such claimant's entitlement to office] presents a question capable of repetition and of sufficient public importance that it ought not to escape appellate review at this time").

The judgment of the Commonwealth Court is reversed, and the case is remanded for further proceedings consistent with this Opinion.*fn14

Mr. Chief Justice Castille, Messrs. Justice Eakin and Baer, Madame Justice Todd and Mr. Justice McCaffery join the opinion.

Madame Justice Greenspan files a concurring opinion.

CONCURRING OPINION

MADAME JUSTICE GREENSPAN

If the issue of whether the term "business" as used in the Ethics Act includes a "nonprofit corporation" had arisen in the context of an actual investigation by the Ethics Commission and subsequent prosecution of former Secretaries Michael DiBerardinis and Kathleen McGinty then I would have wholeheartedly joined the majority opinion. However, as it did not, I must write separately because I believe that this case implicates an important prudential issue regarding judicial restraint, the case or controversy doctrine.*fn15 I realize that the parties have not discussed the application of the doctrine in their briefs. Nevertheless, I believe that, at a minimum, it is appropriate and necessary for this Court to address the prudential limitations before reaching the substantive issues.*fn16

Respectfully, I believe that this Court should vacate the Commonwealth Court's decision as that decision is, in my opinion, advisory. Neither the Ethics Act nor the Declaratory Judgment Act or this Court's jurisprudence permit the Commonwealth Court or this Court to issue advisory opinions.

Remedy at Law

The Commonwealth Court's opinion is advisory for several reasons. To begin, former Secretary of the Department of Conservation and Natural Resources (DCNR) Michael DiBerardinis, former Secretary of the Department of Environmental Protection (DEP) Kathleen McGinty, and Governor Edward G. Rendell (collectively Appellees) did not assert any cognizable injuries for which the Commonwealth Court could provide a legal remedy. The judgment entered by the Commonwealth Court provides an academic answer to a hypothetical situation that had yet to happen at the time that the declaratory judgment action was filed.*fn17

Appellees provided the Commonwealth Court with the following hypothetical scenario and sought the opinion of that court as to whether they would be exposed to liability. In 2007, the spouses of Mr. DiBerardinis and Ms. McGinty were associated with non-profit entities. Ms. Joan Reilly, Mr. DiBerardinis's spouse, is a manager of the Pennsylvania Horticultural Society (PHS), while Dr. Karl Hausker, Ms. McGinty's spouse, was an independent contractor associated with Enterprising Environmental Solutions, Inc. (EESI). In the past, PHS applied for grants to the DCNR and EESI applied for grants to the DEP. Both entities expected but had not applied for grants to the respective departments by the time the present declaratory judgment was commenced in the Commonwealth Court. Mr. DiBerardinis and Ms. McGinty were expected to participate in the grant award processes of their respective departments but had not yet participated by the time the present declaratory judgment was filed in the Commonwealth Court.

Appellees filed an action in the Commonwealth Court seeking a declaration that, in the hypothetical scenario, Mr. DiBerardinis and Ms. McGinty would not have been violating the Ethics Act.*fn18 The decision depended on the interpretation of the term "business," as used in the Ethics Act so the parties asked the Commonwealth Court to issue an opinion on the meaning of the term.*fn19 In general, however, a judgment declaring the law based on a hypothetical scenario is not a remedy recognized under Pennsylvania law. Philadelphia Entm't and Dev. Partners, L.P. v. City of Phila., 937 A.2d 385, 293 (Pa. 2007) (holding that courts of the Commonwealth "should not give answers to academic questions or render advisory opinions or make decisions based on assertions as to hypothetical events that might occur in the future"). Indeed, such a declaration would amount to nothing more than an advisory opinion - an opinion that, like the advice of their own counsel, would merely alert Appellees to the legal consequences of possible future actions.*fn20

Nor does the Ethics Act open the doors to the court for Appellees to seek such a remedy. See 65 Pa.C.S. §§ 1101-1113. Under the Ethics Act, state officials like Appellees may obtain an advisory opinion from the Ethics Commission. See 65 Pa.C.S. § 1107(10), (11). However, the Ethics Act contains no provisions allowing Appellees to obtain the same in court. Thus, the Ethics Act provides no statutory basis for recognizing the remedy sought by Appellees.

Finally, the Declaratory Judgment Act also does not provide Appellees with a remedy in this situation. According to the Declaratory Judgment Act, its purpose is "remedial." 42 Pa.C.S. § 7541(a). A "remedial law" provides "means to enforce rights or redress injuries." BLACK'S LAW DICTIONARY 1319 (8th ed. 1999). As to the remedy, the Declaratory Judgment Act states that

Any person interested under a deed, will, written contract, or other writings constituting a contract, or whose rights, status, or other legal relations are affected by a statute, municipal ordinance, contract, or franchise, may have determined any question of construction or validity arising under the instrument, statute, ordinance, contract, or franchise, and obtain a declaration of rights, status, or other legal relations thereunder.

42 Pa.C.S. § 7533 (emphasis added).

Under the plain language of the statute, only persons who "are affected by a statute," the Ethics Act here, may seek a declaratory judgment. 42 Pa.C.S. § 7533 (emphasis added). The Declaratory Judgment Act does not provide a remedy to persons who will be or, even more remotely, may be affected by the statute.

As noted above, Appellees here sought a declaration from the Commonwealth Court that the term "business" as used in the Ethics Act did not include non-profit corporations. The expressed harm for which Mr. DiBerardinis and Ms. McGinty sought a "declaration" -the Declaratory Judgment Act remedy -- was that they feared civil or criminal prosecution for engaging in the described conduct. The harm described by Governor Rendell was that he was "denied the right to have the official of [his] choosing carry out [the duties and responsibilities of secretary]." Appellees' Reply Brief at 1; see also Appellees' Brief at 17.

Respectfully, in my opinion, the expressed harms were not present but future, hypothetical harms for which the Declaratory Judgment Act does not provide relief. See 42 Pa.C.S. § 7533. After all, Mr. DiBerardinis and Ms. McGinty had not engaged in the hypothetical conduct by the time the declaratory judgment action was filed (nor would they ever engage in that conduct) and Governor Rendell was not deprived of their services. The Declaratory Judgment Act does not provide a remedy when only a potential injury is averred.

42 Pa.C.S. § 7533.*fn21 Thus, because Appellees asserted only a potential injury in their declaratory judgment action, I would hold that the Commonwealth Court issued an advisory opinion that should be vacated. See Gulnac v. South Butler Cnty. Sch. Dist., 587 A.2d 699, 702 (Pa. 1991) (holding that "[a] declaratory judgment must not be employed to determine rights in anticipation of events which may never occur or for consideration of moot cases or as a medium for the rendition of an advisory opinion which may prove to be purely academic"); Pennsylvania Railroad Co., supra.*fn22

Mootness

In the alternative, this Court should dismiss this action as moot because Ms. McGinty and Mr. DiBerardinis are no longer secretaries of the DEP and DCNR, as reflected by the docket and in the caption. Commonwealth v. Kallinger, 615 A.2d 730 (Pa. 1992) (sua sponte dismissing appeal as moot). Because the present litigation was precipitated by circumstances personal to the former secretaries, their successors cannot claim to have a personal interest in this matter. Further, given that the secretaries with potential conflicts of interest described in this case are no longer in office, the Governor also no longer faces his alleged harm -- not being able to use the services of his chosen secretaries in certain grant review processes.

Appellees do not raise any arguments as to why we should make an exception here to the prudential limitation against court review of moot cases. See Commonwealth v. Dixon, 907 A.2d 468, 472-73 (Pa. 2006) (holding that "an appellate court may decide a case where issues important to the public interest are involved, the nature of the question under consideration is such that it will arise again, and review will be repeatedly thwarted if strict rules of mootness are applied"). Also, there is no reason to believe that the issue subject to this appeal is capable of repetition and would escape review if not decided here. In the event that this scenario was to occur again, the secretary involved could conform to the Ethics Commission's advisory opinion or challenge it in a prosecution for a violation.*fn23

Therefore, we should at least refrain from issuing an advisory opinion and dismiss these declaratory judgment actions as moot.

Conclusion

Because I believe that the Commonwealth Court erroneously reached the merits of the Appellants' declaratory judgment action where it should have dismissed it for lack of justiciability, I would vacate the Commonwealth Court's decision. See Gulnac, 587 A.2d at (vacating lower court opinion that improperly reached the merits of a non-justiciable action).*fn24


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