August 11, 2011
ADEWALE SULE, PETITIONER
PHILADELPHIA PARKING AUTHORITY, RESPONDENT
The opinion of the court was delivered by: Mary Hannah Leavitt, Judge
Argued: May 10, 2011
BEFORE: HONORABLE MARY HANNAH LEAVITT, Judge HONORABLE JOHNNY J. BUTLER, Judge HONORABLE JAMES R. KELLEY, Senior Judge
OPINION BY JUDGE LEAVITT
Adewale A. Sule petitions for review of an adjudication of the Philadelphia Parking Authority*fn1 imposing a $500 fine for his alleged violation of an executive order of the Authority, which provides that a taxicab driver may not prevent a passenger from using a credit card. Because the Hearing Officer's factual findings were based solely on uncorroborated hearsay and, therefore, not supported by substantial evidence, we reverse the Authority's order.
On September 15, 2009, Sule, a certified taxicab driver, was driving Medallion taxicab number P-1096 in the City of Philadelphia. At approximately 12:30 p.m., Sule picked up Lori Hedrick and took her to the Hilton Hotel on City Avenue. Hedrick paid her fare using a credit card. Later that afternoon, Hedrick called the Authority and complained that Sule had attempted to dissuade her from using a credit card. Hedrick's complaint was assigned to Inspector David Rotan for further investigation.
Rotan spoke to both Hedrick and Sule on the day of the incident. After speaking with Hedrick over the phone, Rotan asked her to provide a written statement regarding her allegations, which she did one week later. Rotan met with Sule and obtained his account of the incident. Based upon his investigation, Rotan determined that Sule had attempted to prevent Hedrick from using a credit card to pay her fare. On September 16, 2009, the Authority issued a citation charging Sule with inhibiting a passenger's use of a credit card in violation of the Authority's Executive Order 07-0002.*fn2
Sule appealed the citation and a hearing was held on December 10, 2009. Sule appeared pro se. Rotan, the Authority's only witness, testified about his investigation. He spoke first with Hedrick who told him that when she tried to pay for her ride with a credit card, Sule tried to get her to pay with cash and only allowed her to use a credit card when she said she had no cash. Rotan then read into evidence a written statement submitted by Hedrick by e-mail on September 22, 2009. In that statement, Hedrick recounted that when she told Sule she was going to pay with a credit card, he asked her to pay in cash. When she refused, he claimed that his credit card machine did not work and she would have to pay in cash. She again refused, at which point Sule told her if she paid with a credit card he would not actually receive the funds for a week. Only after Hedrick told Sule she had no cash did he activate the credit card machine. Sule did not object to Rotan reading Hedrick's statement into evidence.
Rotan then testified about his conversation with Sule on the day of the incident. Sule informed Rotan that there was never any dispute regarding how Hedrick would pay her fare. Rotan recalled Sule telling him that he believed Hedrick was going to pay in cash, prompting Sule to shut off his meter.
Rotan also testified regarding Executive Order 07-0002 and Authority Board Order 08-0005; copies of both orders were introduced into evidence. First, Rotan noted that Executive Order 07-0002 requires drivers not to "inhibit, prevent, or refuse the use of a credit card." He then explained that Authority Board Order 08-0005 re-designated that violation to be a Class A violation, establishing a $500 fine for a first offense.*fn3 Rotan explained that even though Sule eventually accepted Hedrick's credit card, he cited Sule because he had initially inhibited the use of a credit card.
Sule testified on his own behalf. His primary defense to the citation was, simply, that he accepted Hedrick's credit card payment. Sule explained that he asked Hedrick how she was going to pay because it affected how he operated the meter. Sule opined that Hedrick did not understand him because of his accent.
On cross-examination, Sule acknowledged that at one point Hedrick tried to give him her credit card and he told her "no." He explained that he said "no" because he could not use her card; the card reader was not located in the front of the cab, where the meter is located, but in the passenger compartment of the cab. Accordingly, Hedrick had to swipe the card. Sule recalled that when Hedrick first tried to use her card the transaction did not process, so he reset the machine. On her second attempt, the transaction processed successfully.
The Hearing Officer reviewed the evidence and concluded that Sule had violated Executive Order 07-0002. The Hearing Officer credited Rotan's testimony and Hedrick's e-mailed written statement to find that Sule had inhibited Hedrick's use of a credit card to pay her fare. Recognizing a potential hearsay issue with Hedrick's written out-of-court statement, the Hearing Officer explained:
Inspector Rotan's testimony and his conclusions from the investigation he conducted are credible, logical and certainly establish that the Authority has met its burden of proof by the clear precise statement [of Hedrick], which, by strict application of legal [principles] might be considered hearsay, but even introduced by letter, bears a ring of truth that is plausible and far more convincing than [Sule's] long diatribe offered to convince the fact finder that the occurrence never took place.
Hearing Officer Adjudicationat 3-4. The Hearing Officer imposed a $500 fine pursuant to Authority Board Order 08-0005. Sule now petitions for this Court's review.*fn4
On appeal, Sule raises two issues for our review. First, he contends that the Hearing Officer erred by relying solely on hearsay evidence. Second, he argues that the Authority's Executive Order, 07-0002, under which he was cited, is an invalid and unenforceable regulation.
Sule first argues that the Hearing Officer erred by upholding the citation based solely on hearsay evidence. Specifically, he contends the Authority's only evidence was Hedrick's uncorroborated, out-of-court written statement regarding the alleged dispute. Hedrick neither appeared at the hearing nor testified by telephone to corroborate her e-mail statement. Sule argues that Rotan's testimony about Hedrick's hearsay statements to him after the incident is also hearsay. Sule asks this Court to vacate the Board's order and, additionally, enter an order prohibiting the Authority's hearing officers from treating (1) hearsay testimony of Authority inspectors and (2) unsworn out-of-court statements by complaining passengers as probative evidence in future hearings.
As a general rule, the Pennsylvania Rules of Evidence are not applicable to hearings conducted before Commonwealth agencies. 2 Pa. C.S. §505.*fn5 Nevertheless, it is well-settled that hearsay evidence, properly objected to, is not competent evidence to support a determination of an agency. Chapman v. Unemployment Compensation Board of Review, 20 A.3d 603, 610, n.8 (Pa. Cmwlth. 2011). Under the so-called Walker rule, however, if hearsay evidence is admitted without objection, it will be given its natural probative effect and may support a finding by the agency, if it is corroborated by any competent evidence in the record. Walker v. Unemployment Compensation Board of Review, 367 A.2d 366, 370 (Pa. Cmwlth. 1976) (emphasis added). One example of "competent evidence" that would corroborate hearsay evidence are admissions of a party. Chapman, 20 A.3d at 610, n.8; see also PA. R.E. 803(25).*fn6
Sule contends that Hedrick's out-of-court written statement and Rotan's testimony about what Hedrick said to him are hearsay. We agree that these items of evidence are classic examples of hearsay. However, both were admitted into the record without objection and, consequently, could support the Hearing Officer's findings if they were corroborated by any competent evidence in the record. Walker, 367 A.2d at 370 (emphasis added). Therefore, we must determine whether the Authority's hearsay evidence is corroborated by other competent evidence of record.
A review of Sule's testimony reveals that he admitted only that a dispute arose after Hedrick misunderstood his inquiry regarding how she was going to pay. First, she tried to have Sule swipe her credit card, which he could not do because the machine was in the passenger compartment. This was followed by the credit card machine's failure to process the first transaction. Sule made no admissions that corroborate Hedrick's claim that he either refused or inhibited her use of a credit card. Furthermore, the Authority could not use Rotan's hearsay testimony about what Hedrick said to him to corroborate Hedrick's written statement. Hearsay cannot corroborate hearsay. See J.K. v. Department of Public Welfare, 721 A.2d 1127, 1133 (Pa. Cmwlth. 1998)(noting substantial evidence did not exist because there was no non-hearsay evidence to corroborate hearsay testimony); Walker, 367 A.2d at 370 (requiring hearsay to be corroborated by competent evidence in the record). If the Authority wished to base its case solely upon Hedrick's written statement and her account of the incident, then it should have either arranged for her to be present at the hearing or to testify by phone. In short, the Hearing Officer erred by basing his factual findings solely upon Hedrick's uncorroborated, out-of-court statement.
In his second issue, Sule argues that the Authority's Executive Order 07-0002 and Board Order 08-0005 are invalid and unenforceable. We decline to reach the merits of this issue in light of our holding on Sule's first issue. However, we note our doubt that the orders, under which the Authority proceeded against Sule, are enforceable.
In Germantown Cab Co. v. Philadelphia Parking Authority, 993 A.2d 933 (Pa. Cmwlth. 2010), petition for allowance of appeal granted, ___ Pa. ___, 14 A.3d 821 (2011), this Court reiterated that the Authority must comply with the Commonwealth Documents Law*fn7 and that any of its regulations not promulgated in accordance with the Law are invalid. The Authority cannot circumvent the rulemaking procedures in the Commonwealth Documents Law by promulgating a quasi-legislative regulation affecting the entire taxicab industry simply by labeling that regulation an "order." The Authority is statutorily authorized to issue orders,*fn8 but such orders are meant to apply to a specific entity or individual, not to the industry as a whole. See Commonwealth ex rel. Tarner v. Bitner, 294 Pa. 549, 555, 144 A. 733, 735 (1929)(noting an order provides for the disposition of a particular piece of business). Cf. Section 102 of the Commonwealth Documents Law, Act of July 31, 1968, P.L. 769, as amended, 45 P.S. §1102 (defining "regulation" as any rule or regulation promulgated under statutory authority in the administration of a statute administered by the agency).
For the reasons set forth above, we reverse the Authority's order.*fn9
IN THE COMMONWEALTH COURT OF PENNSYLVANIA
Adewale Sule, Petitioner v. Philadelphia Parking Authority, Respondent
No. 1832 C.D. 2010
AND NOW, this 11th day of August, 2011, the order of the Philadelphia Parking Authority, dated February 22, 2010, in the above-captioned matter is hereby REVERSED.
MARY HANNAH LEAVITT, Judge