Borough of Economy v. Pennsylvania Human Relations Com'n

• Decision Date: 01 June 1995
• Citation: 660 A.2d 143
• Parties: BOROUGH OF ECONOMY, Petitioner, v. PENNSYLVANIA HUMAN RELATIONS COMMISSION, Respondent.
• Court: Pennsylvania Commonwealth Court

Page 143

660 A.2d 143

BOROUGH OF ECONOMY, Petitioner, v. PENNSYLVANIA HUMAN RELATIONS COMMISSION, Respondent.

Commonwealth Court of Pennsylvania.

Submitted on Briefs March 3, 1995.

Decided June 1, 1995.

David G. Joyce, for petitioner.

Katherine H. Fein, Asst. Chief Counsel, for respondent.

Before COLINS, President Judge, and NEWMAN, J., and SILVESTRI, Senior Judge.

SILVESTRI, Senior Judge.

The Borough of Economy (Economy) petitions for review of an order of the Pennsylvania Human Relations Commission (PHRC) which determined that Economy discriminated against Nathaniel J. Moore (Complainant) on the basis of race (black) by refusing to award him ¹ a contract for refuse and garbage pick-up in the borough and directed Economy to pay damages to Complainant in the amount of $90,938.10 plus interest, representing Complainant's monetary loss from denial of the contract, and also directed Economy to award Complainant the refuse and garbage pick-up contract for the year 1995-1996.

The detailed factual and procedural history, necessary for a determination on the merits of this discrimination case, is as follows. Economy is a municipal corporation located in Beaver County, Pennsylvania. In the spring of 1986, Economy published an advertisement in the Beaver County Times newspaper soliciting bids for the exclusive right to provide residential garbage and refuse pickup in the borough. ² The advertisement indicated that bids must be in the hands of the borough secretary prior to council's regularly scheduled meeting on May 13, 1986 and advised that specifications for the bid proposals were contained in the "SANITATION AND REFUSE DISPOSAL ORDINANCE" (Ordinance). See Joint Exhibit 3.

Economy's "SPECIFICATIONS FOR GARBAGE AND RUBBISH COLLECTION" (Specifications) identified further requirements. Specifically, the Specifications required, inter alia, a "[p]erformance bond in the amount of $25,000.00 or security acceptable to Council for contract period upon awarding of bid" and "[a]lternative bids for one-year contract and two-year contract." See Complainant's Exhibit 2. (Emphasis added).

On May 13, 1986, in response to Economy's advertisement soliciting bids, Complainant submitted a bid ³ for Complainant to provide yearly residential refuse and garbage pick-up services for the time period of 1986-1988. Two other bids were also submitted: one by Elliot Reid Powell for a one-year period at the rate of $14.25 per quarter per household, ⁴ and the other by Gary E. Robinson at the rate of $3.95 per month for two (2) 32 gallon bags and one large item per week and $4.95 per month for four (4) 32 gallon bags plus one large item per week. The three garbage and refuse bids were referred to committee for review; the award of the contract was to be made on May 28, 1986.

At the meeting held May 28, 1986, Complainant did not attend; however, Mack Brown (Brown) was present at the meeting as the representative of the Complainant. Economy borough council reviewed the bid presented by Complainant and directed numerous questions to Brown, which Brown responded to. ⁵ Brown also offered a certified check in the amount of $2,500.00 which he had received from Complainant as compliance with the performance bond requirement, which council rejected. Thereafter, by motion, borough council awarded the garbage and refuse disposal contract to Complainant "contingent on the receipt of the necessary performance bond, liability insurance and workers' compensation coverage to be presented prior to the next regularly scheduled Council meeting on June 10, 1986.... If necessary bonds and insurance are not presented the proposal will revert back to the present collector, E. Reid Powell, Refuse." See Joint Exhibit 5.

At the next council meeting on June 10, 1986, Complainant appeared, accompanied by Brown. Brown was asked what he had to present to council in the way of fulfilling the requirements. Brown stated that the bank would "not do anything without the contract actually being presented to them". Council indicated they would not present the contract to Complainant without the proof of bond and insurance. The solicitor explained that a letter from the bank saying that the money was put aside for the required surety bond of $25,000.00 was all that was necessary and that Brown should have contacted the solicitor for a copy of the minutes of the council meeting in which the contract was awarded subject to the contingencies of the bond and insurance. See Joint Exhibit 6.

Brown was then specifically asked if during their last conversation it was not clear to him exactly what was necessary. Brown replied "it was clear, he understood." After this discussion, the borough council determined that the requisite requirements for awarding of the contract to Complainant had not been met as Complainant had not obtained a performance bond ⁶ or other "security acceptable to council". Powell was then designated garbage collector for the borough consistent with the minutes of the May 28, 1986 meeting. See Joint Exhibit 6.

Thereafter, on August 6, 1986, Complainant filed a complaint of unlawful racial discrimination with the PHRC. After hearing, the PHRC issued a final determination on September 29, 1994, in which it found that Economy's award of the refuse and garbage contract to Powell constituted unlawful racial discrimination which necessitated remedial relief. The PHRC specifically found that the requirement for a performance bond was a pretext for discrimination because Powell, the prior hauler who was white, was not required to provide such a bond on past contracts.

In its final order of September 29, 1994, the PHRC specifically directed that Economy cease and desist from discriminating in the award of its contracts, award Complainant the residential refuse and garbage pick-up contract for the year 1995-1996, pay monetary damages in the amount of $90,938.10 plus interest through the date of the public hearing, and report on its compliance with the Order within thirty (30) days. Economy's petition for review to this court followed.

Economy presents two issues for our consideration, i.e. whether substantial evidence exists to support the determination of the PHRC that it unlawfully racially discriminated in its award of the refuse and garbage pick-up contract, and whether the PHRC's award of monetary relief and award of the garbage and refuse contract to Complainant for the year 1995-1996 was within its authority. Our review of these issues is limited to whether the determination of the PHRC is in accordance with the law, whether the necessary findings of fact are supported by substantial evidence, and whether there has been a violation of constitutional rights. Pittsburgh, Department of Personnel and Civil Service Commission v. Pennsylvania Human Relations Commission, 157 Pa.Commonwealth Ct. 564, 630 A.2d 919 (1993). Our appellate review must focus on whether there is rational support in the record, when viewed as a whole, to support the PHRC's action. Republic Steel Corp. v. Workmen's Compensation Appeal Board, 492 Pa. 1, 421 A.2d 1060 (1980).

As to the issue of whether substantial evidence exists to support the determination by the PHRC of unlawful racial discrimination, we initially note that substantial evidence is defined as such relevant evidence which a reasonable mind might accept as adequate to support a conclusion. Brown Transport Corp. v. Pennsylvania Human Relations Commission, 133 Pa.Commonwealth Ct. 545, 578 A.2d 555 (1990); Consumers Motor Mart v. Pennsylvania Human Relations Commission, 108 Pa.Commonwealth Ct. 59, 529 A.2d 571 (1987). Thus, herein, there must be substantial evidence presented sufficient to convince a reasonable mind, to a fair degree of certainty, that Economy violated the Pennsylvania Human Relations Act (Act), Act of October 27, 1955, P.L. 744, as amended, 43 P.S. §§ 951-962.2. Thomas v. Pennsylvania Human Relations Commission, 106 Pa.Commonwealth Ct. 598, 527 A.2d 602 (1987). With this standard in mind, our review of the record reveals substantial evidence does not exist to support the determination of the PHRC.

In a disparate treatment case, Complainant bears the burden of establishing a prima facie case of discrimination ⁷; if he does so, the burden then shifts to employer to rebut the inference of discrimination by establishing some legitimate common, nondiscriminatory reasons for its conduct or action. If the employer does so, in order to prevail, Complainant must then show by a preponderance of the evidence that the proffered reasons were pretextual and that Complainant was the victim of intentional discrimination. Pittsburgh Board of Public Education v. Pennsylvania Human Relations Commission, 128 Pa.Commonwealth Ct. 324, 563 A.2d 581 (1989); Pennsylvania State Police v. Pennsylvania Human Relations Commission, 116 Pa.Commonwealth Ct. 89, 542 A.2d 595 (1988).

The standards enunciated above are generally applicable to cases of alleged discrimination in the course of employer-employee relationships including inter alia, discharge and refusal to hire. Our independent research has not revealed, either in the Act itself or any prior appellate decision of this Commonwealth, any particulars applicable to discrimination alleged in the context of prohibited conduct by government bodies when in the course of entering contractual relationships with independent contractors for the performance of municipal services. ⁸

In Allegheny Housing Rehabilitation Corp. v. Pennsylvania Human Relations Commission, the Supreme Court of this Commonwealth examined this court's and the PHRC's method of following and applying the analytical model developed by the United States Supreme Court for Title VII cases (Civil Rights Act of 1964, including 42 U.S.C. § 1981) in McDonnell Douglas Corp. v. Green, 411 U.S. 792, 93 S.Ct. 1817, 36 L.Ed.2d 668 (1973). ⁹ The Supreme Court determined in Allegheny Housing that once a prima facie case of...