Melendez v. COM. OF PUERTO RICO PUBLIC RECREATION

• Decision Date: 28 January 1994
• Docket Number: Civ. No. 91-2453CCC.
• Citation: 845 F. Supp. 45
• Parties: Frances MELENDEZ by Her and as Tutor of the Minor Children Jose, Melvin and Frank Melendez, Plaintiffs, v. The COMMONWEALTH OF PUERTO RICO The PUBLIC RECREATION & PARKS ADMINISTRATION; The Puerto Rico Electric Power Authority; Eastern American Insurance Co.; The Recreation Development Company X, Y, Z, Insurance Company, Inc., Defendants.
• Court: U.S. District Court — District of Puerto Rico

845 F. Supp. 45

Frances MELENDEZ by Her and as Tutor of the Minor Children Jose, Melvin and Frank Melendez, Plaintiffs, v. The COMMONWEALTH OF PUERTO RICO The PUBLIC RECREATION & PARKS ADMINISTRATION; The Puerto Rico Electric Power Authority; Eastern American Insurance Co.; The Recreation Development Company X, Y, Z, Insurance Company, Inc., Defendants.

Civ. No. 91-2453CCC.

United States District Court, D. Puerto Rico.

January 26, 1994.

As Amended January 28, 1994.

COPYRIGHT MATERIAL OMITTED

Glenn Carl James-Hernández, Mercado & Soto, for plaintiffs.

Pedro Santiago-Torres, for PREPA.

Guillermo Macari, Dept. of Justice, Com. of P.R., for defendants.

OPINION AND ORDER

CEREZO, Chief Judge.

The Department of Sports and Recreation¹ (hereinafter DSR), and Recreation Development Company (hereinafter RDC) have filed a Motion for Summary Judgment (docket entry 33), as supplemented (docket entry 62). This is a personal injury action filed by Frances Meléndez, in representation of minors José, Melvin, and Frank Meléndez,² claiming that José sustained serious injuries after receiving an electric shock from an unlocked transformer. It is specifically claimed that there was negligence in maintaining the unlocked transformer without visible warnings at a park owned or maintained by the Public Recreation and Parks Administration,³ and/or RDC.

Initially, RDC requested summary judgment on the basis of absence of control over the park where the accident occurred, while DSR claimed that, as an alter ego of the Commonwealth, it enjoys immunity from suit under the Eleventh Amendment. Plaintiffs replied asserting that DSR did not present sufficient evidence to satisfy its burden of proof (docket entry 39). DSR countered (docket entry 41) by discussing in depth the factors that bear upon an Eleventh Amendment immunity determination and submitting additional evidence in the form of certifications under penalty of perjury, pursuant to 28 U.S.C. § 1746. Subsequently, in its supplement to the motion for summary judgment (docket entry 62), RDC also claimed Eleventh Amendment immunity, and that the alleged cause of action was time barred. Plaintiffs then supplemented their opposition to the motion for summary judgment due to the fact that RDC adduced for the first time the sovereign immunity defense (docket entry 68).

After carefully reviewing the positions of the parties and the statements made under penalty of perjury we conclude that, in the context of the action initiated, both DSR and RDC are arms of the Commonwealth and, as such, are entitled to immunity from federal adjudication under the Eleventh Amendment.

I. The Applicable Law

The Eleventh Amendment provides that "the Judicial power of the United States shall not be construed to extend to any suit in law or equity, commenced or prosecuted against one of the United States by Citizens of another State, or by Citizens or Subjects of any Foreign State." The primary purpose of the amendment is to assure that the federal courts do not interfere with a state's public policy and its administration of internal public affairs. In re Ayers, 123 U.S. 443, 8 S.Ct. 164, 31 L.Ed. 216 (1887). It is concerned with minimizing the federal court's involvement in the disbursal of the state fisc. Metcalf & Eddy v. P.R. Aqueduct & Sewer Authority, 991 F.2d 935 (1st Cir.1993).

The Eleventh Amendment acts as a jurisdictional bar and defense to all suits claiming money damages brought in federal court against a state,⁴ without its consent. Trans Am. Recovery Serv. v. P.R. Maritime Shipping, 820 F.Supp. 38, 41 (D.P.R.1993). Its application to a public agency or institution depends upon whether the entity "is to be treated as an arm or alter ego of the State partaking of the State's Eleventh Amendment immunity, or is instead to be treated as a municipal corporation or other political subdivision to which the Eleventh Amendment does not extend." Ainsworth Aristocrat Intern. Pty. v. Tourism Co., 818 F.2d 1034, 1036 (1st Cir.1987); quoting Mount Healthy City School Dist. Bd. of Educ. v. Doyle, 429 U.S. 274, 280, 97 S.Ct. 568, 572, 50 L.Ed.2d 471 (1977).

Whether an entity is protected will depend largely on how it is structured. 12 Jeremy C. Moore, et al, Moore's Federal Practice, ¶ 300.034, (2d ed. 1985). As a general rule, an institution is immune from federal adjudication if the state has a legal obligation to satisfy judgments against it. Metcalf & Eddy, 991 F.2d at 939. However, when it is not clear whether, or to what extent, such an obligation exists, other areas which may indicate how tightly the agency and the state are entangled should be examined. Id. at 939-40.

Eleventh Amendment protection depends, primarily, on whether the state-created entity "performs a governmental function, whether it functions with substantial autonomy, to what extent it is financed independently of the state treasury, and if a judgment sought to be entered against the entity will be satisfied out of the state treasury." In re San Juan Dupont Plaza Hotel Fire Litigation, 888 F.2d 940, 942 (1st Cir.1989); quoting Figueroa-Rodríguez v. Aquino, 863 F.2d 1037, 1042 (1st Cir.1988); Culebras Enterprises Corp. v. Rivera Ríos, 813 F.2d 506, 517 (1st Cir.1987). The factors relevant to this inquiry include whether the entity "has been separately incorporated; ... whether it has the power to sue and be sued and to enter into contracts; whether its property is immune from state taxation, and whether the sovereign has immunized itself from responsibility for the entity's operations." In re San Juan Dupont Plaza Hotel; 888 F.2d at 942, quoting Ainsworth Aristocrat, 818 F.2d 1034, 1037. While the determination of whether an agency is an arm of the state is a matter of federal law, local law and decisions defining the status and nature of the agency in its relation to the sovereign should also be considered. Metcalf & Eddy, 991 F.2d at 942; Ainsworth Aristocrat, 818 F.2d at 1037.

II. Department of Sports and Recreation

The Legislature of the Commonwealth of Puerto Rico made it abundantly clear that the DSR was to perform a governmental function. The Legislature stated in 1980 that "the health and well-being of citizens is one of the objectives any contemporary government strives to achieve." Statement of Motives, Act No. 126 of June, 13, 1980, 1980 Laws of P.R. 469. The Legislature "visualized an improvement in the social and congenial aspects of ... the Island's citizens by achieving a proper balance in the good use of leisure time in sports and recreational activities, as well as in work and education." Id.

The DSR was created as the government's response to the citizens' increased demand for recreational activities and facilities. Id. at pp. 469-70. The government set itself "to encourage and stimulate sports and recreation in Puerto Rico." Id. Government efforts were directed to "promoting the practice of sports and recreation as instruments to achieve a better enjoyment of life," and to provide citizens, through their involvement in recreation, with mechanisms to develop an emotional balance that would enable them to face everyday problems. Id. at p. 470. To that end, the DSR was created with a programmatic emphasis on the encouragement, promotion and programming of sports and recreational activities, and their regulation and supervision. Id.

It should be noted that the basis of the plaintiffs' claim is that DSR's negligence in maintaining one of its parks was the cause of their damages. Defendants' Exhibit B, a deed executed before notary public García-Malatrasi, establishes that the Commonwealth of Puerto Rico is the owner of the Jardines de Country Club park. In administering and controlling one of the Commonwealth's parks the DSR was complying with one of its statutorily imposed duties, see 15 L.P.R.A. § 2; clearly a government function.

The Government exerts significant control over the planning and administration of the DSR. The DSR was created as an executive department of the Commonwealth. 3 L.P.R.A. § 442b. The DSR is directed by a Secretary (hereinafter the "Secretary") which is appointed by the Governor, with the advice and consent of the Senate. 3 L.P.R.A. § 442c. An Advisory Board helps the Secretary formulate and implement the public policy on Sports and Recreation. 3 L.P.R.A. § 442i. The Advisory Board is presided by the Secretary and comprised by the Secretaries of Education, Health, Social Services, Natural Resources, and by the Executive Director of the Office of Youth Affairs, the Director of the Tourism Company, and eight private citizens with known interests in sports and recreation. Id. With the noteworthy exception of the Director of the Tourism Company, who is appointed by the Board of Directors of said company,⁵ all members of the Advisory Board are appointed by the Governor. Constitution of the Commonwealth of Puerto Rico, Art. IV., §§ 5-6, 3 L.P.R.A. § 171, 3 L.P.R.A. § 211a, 3

L.P.R.A. § 154, 3 L.P.R.A. § 1606, 3 L.P.R.A. § 442i.

The Secretary of the DSR has the power to rent, give in usufruct, transfer or alienate any recreational facility belonging to the Department or the Commonwealth government to any other agency, municipality, or bona fide private organization, but only after obtaining the approval of the Secretary of the Treasury. 3 L.P.R.A. § 442g. As a member of the Governor's advisory council, the Secretary of the Treasury Department is also appointed by the Governor. Constitution of the Commonwealth of Puerto Rico, Art. IV §§ 5-6. DSR must purchase its equipment, materials and everything needed to carry on with its functions through the General Services Administration, an agency of the Executive Branch. 3 L.P.R.A. § 442t. To procure items outside the procedure established by the General Services Administration, the Secretary must first obtain the approval from the Secretary of the Treasury. Id.

Finally, to wrap up government's control over the DSR, the Secretary must...