Blackwell v. Com., State Ethics Com'n

• Decision Date: 13 December 1989
• Parties: Honorable Lucien BLACKWELL, Member City Council of Philadelphia, Honorable David Cohen, Member City Council of Philadelphia and Honorable Francis Rafferty, Member City Council of Philadelphia, Appellees, v. COMMONWEALTH of Pennsylvania, STATE ETHICS COMMISSION, Appellant. 162 E.D. 1988
• Court: Pennsylvania Supreme Court

Page 630

567 A.2d 630

523 Pa. 347

Honorable Lucien BLACKWELL, Member City Council of

Philadelphia, Honorable David Cohen, Member City Council of

Philadelphia and Honorable Francis Rafferty, Member City

Council of Philadelphia, Appellees, v. COMMONWEALTH of Pennsylvania, STATE ETHICS COMMISSION, Appellant.

162 E.D. 1988

Supreme Court of Pennsylvania.

Argued Oct. 23, 1989.

Decided Dec. 13, 1989.

Vincent J. Dopko, Harrisburg, Ernest D. Preate, Atty. Gen., Jules S. Henshell, Deputy Atty. Gen., John G. Knorr, III, Chief Deputy Atty. Gen., for appellant.

Charles W. Bowser, James P. Cousounis, Philadelphia, for appellees.

Before NIX, C.J., and LARSEN, FLAHERTY, McDERMOTT and ZAPPALA, JJ.

OPINION OF THE COURT

LARSEN, Justice.

The appellant herein is the Commonwealth State Ethics Commission (the "Commission"), which was created by section 6 of the Act of October 4, 1978, P.L. 883, No. 170, 65 Pa.Stat.Ann. § 406 (Purdon's Supp.1989). Appellees are the Honorable Lucien Blackwell, the Honorable David Cohen and the Honorable Francis Rafferty, all members of the City Council of Philadelphia.

By letters of June 19, 1987, the Executive Director of the Commission notified each appellee that he was under investigation pursuant to a sworn complaint alleging a violation of section 3(a) of the Public Officials Ethics Act (the "Ethics Act"), 65 Pa.Stat.Ann. § 403(a). ¹ The alleged violation was that each member had hired his wife to work in his city council office. ²

Appellees, through legal counsel, objected to the Commission's investigation on the grounds that, inter alia, it lacked jurisdiction over appellees by virtue of the Philadelphia Home Rule Charter (351 Pa.Code § 1.1-100) which, appellees argued, preempted the field relating to matters of ethics involving Philadelphia officials. The Commission was unimpressed by this preemption argument, and it continued its investigation.

On September 13, 1988, appellees filed in the Commonwealth Court a Petition for Review in the Nature of an Action for Declaratory Judgment and Action in Equity, which petition sought a declaration that, inter alia, the Philadelphia Home Rule Charter preempted the provisions of the Ethics Act with regard to the conduct of Philadelphia officials and therefore deprived the Commission of jurisdiction to investigate appellees. This petition for review also sought to enjoin the Commission from conducting an investigation or any proceedings regarding appellees' ethics or conduct. The Commission filed preliminary objections seeking to dismiss the petition for review on the grounds that appellees had a "full, complete and adequate remedy at law," namely the administrative proceedings before the Commission with the right to appeal an adverse determination, that the administrative proceedings were still pending, and that appellees failed to make service of the petition for review on the Attorney General as required by Pa.R.A.P.Rule 1514(c).

The Commission denied appellees' request to stay further proceedings and investigation pending the Commonwealth Court's resolution of the petition for review. Subsequently, on or about September 29, 1988, the Commission served a subpoena upon the First Pennsylvania Bank in Philadelphia requiring a custodian of the bank to appear at the Commission's offices in Harrisburg on October 11, 1988 and to produce all records regarding the bank accounts of Lucien Blackwell and/or his wife, Jannie Blackwell.

Appellee Blackwell was advised by the bank on October 4, 1988 that it had received said subpoena and would comply with it. The following day, appellees filed in Commonwealth Court an Application for Special Relief In the Nature of a Preliminary Injunction seeking to enjoin the Commission from taking any further action in connection with its investigation of appellees, and on October 7, 1988, appellees filed an Application for Special Expedited Relief in the Nature of a Temporary Restraining Order and Protective Order repeating the request for injunctive relief, and also asking the court to quash the subpoena to First Pennsylvania Bank. On October 11th, Senior Judge Emil E. Narick stayed the subpoena pending a hearing on the petition for a preliminary injunction, and denied the request to enjoin the Commission from further investigation or other action.

On October 20th, the court held a hearing on the application for preliminary injunction before Judge Doris A. Smith. On October 25th, 1988, Judge Smith issued the order which is the subject of this appeal. This Order of October 25, 1988 (a) stayed the subpoena served upon First Pennsylvania Bank "pending disposition by this Court of preliminary objections to [Appellee's] petition for review in the nature of action for declaratory judgment and action in equity ...," and (b) denied appellees' "request to enjoin the State Ethics Commission from continuing its investigation in this matter ... inasmuch as Council Members have not satisfied criteria for the granting of a preliminary injunction."

The Commission timely filed an appeal from that portion of this order of October 25, 1988 which stayed the subpoena and, as required by Pa.R.A.P. Rules 909 and 910, filed a jurisdictional statement asserting that the stay order "effectively granted a preliminary injunction" of the investigation, and was therefore immediately appealable under 42 Pa.C.S.A. §§ 723(a), 5105(c) and Pa.R.A.P. Rule 311(a)(4). On December 16, 1988, this Court noted probable jurisdiction, and the case was scheduled for briefing and listed for oral argument on direct appeal.

Meanwhile, on December 14, 1988, the Commonwealth Court proceeded to hear argument en banc on the Commission's preliminary objections to appellees' petition for review seeking declaratory and injunctive relief. On April 7, 1989, --- Pa.Cmwlth. ----, 556 A.2d 988, the Commonwealth Court, in an opinion by President Judge James Crumlish, Jr., dismissed the Commission's preliminary objections to said petition, holding that the relief sought was available to appellees under the Declaratory Judgments Act, 42 Pa.C.S.A. §§ 7531-7541, despite the pendency of proceedings before the Commission, and also dismissed the preliminary objection based on alleged improper service.

A concurring opinion was filed by Judge James Gardner Colins, joined by Judge Francis A. Barry. The concurring opinion pointed out, sua sponte, that there was at least a serious question as to whether the Commission was lawfully in existence when it issued the subpoena to First Pennsylvania Bank in September, 1988 and throughout its investigation of appellees after June 30, 1988. Judge Colins pointed out that the Commission had been scheduled to go out of existence on December 31, 1987 by operation of the Sunset Act of 1981, Act of December 22, 1981, P.L. 508, No. 142, as amended, §§ 1-14, 71 Pa.Stat.Ann. §§ 1795.1-1795.14 (Purdon's Supp.1989). The actual date of termination would have been June 30, 1988 because of the six-month "wind up" provision of section 6(f), 71 P.S. § 1795.6(f). Although the life of the Commission had been ostensibly extended until December 31, 1988 by resolution of the "Leadership Committee" pursuant to section 4(4) of the Sunset Act, 71 P.S. § 1795.4(4), the concurring opinion expressed the belief that this extension was "unconstitutional, as it allows a group of six (6) persons [i.e., the Leadership Committee] to legislate in place of the full House and Senate. Such a practice allows the circumvention of the established procedures governing the adoption of resolutions. See Article II, § 1; Article III, §§ 1, 4, 5, 8 and 9; Article V, § 15, of the Pennsylvania Constitution." Pa.Cmwlth. at ---, 556 A.2d at 992. The concurring opinion further observed that, under this view, the Commission had gone "out of existence ... [and had] no jurisdiction to continue this or any other investigation." Id. at ---, 556 A.2d at 992.

On June 7, 1989, appellees filed with this Court an Application to Quash the Appeal for the reasons stated in Judge Colins' concurring opinion, arguing that the Commission has no standing to pursue the appeal because it had ceased to exist as of June 30, 1988, due to the operation of the Sunset Act and the unconstitutional and ineffective extension of the life of the Commission by the Leadership Committee. The Commission disputes appellees' contention that the extension of the life of the Commission by the Leadership Committee was unconstitutional; instead the Commission asserts that the one year extension was not an exercise of "legislative power" but was rather a mere procedural, administrative mechanism which could be exercised by committee.

We agree with appellees that the extension of life granted the Commission by the Leadership Committee was an unlawful exercise of the legislative power that was unlawfully delegated to the Leadership Committee by section 4(4) of the Sunset Act, and, for the reasons to follow, that the Commission had no jurisdiction or authority to pursue the investigation of appellees at times relevant to this appeal, or for that matter, to pursue the appeal. Accordingly, we will grant the motion to quash the appeal. Some background information is necessary.

The State Ethics Commission

The Commission was established on January 1, 1979, as part of the Public Officials' Ethics Act. 65 Pa.Stat.Ann. §§ 401-413. The Ethics Act required statements of financial disclosure to be filed annually by public officials and prohibited certain activities by public officials that might present a "conflict [or] the appearance of a conflict with the public trust." 65 P.S. §§ 404 and 403. The Commission was created to implement, administer and enforce the Ethics Act, and was composed of seven members appointed by members of the General Assembly and by the Governor. 65 P.S. §§ 407 and 406.

The Sunset Act

With the passage of the Sunset Act in 1981, Pennsylvania joined some 35 states that had enacted "sunset" legislation since...