Scott v. Philadelphia Parking Authority

• Decision Date: 01 December 1960
• Citation: 402 Pa. 151,166 A.2d 278
• Parties: Howard SCOTT v. PHILADELPHIA PARKING AUTHORITY, Appellant.
• Court: Pennsylvania Supreme Court

Page 278

166 A.2d 278

402 Pa. 151

Howard SCOTT v. PHILADELPHIA PARKING AUTHORITY, Appellant.

Supreme Court of Pennsylvania.

Dec. 1, 1960.

Rehearing Denied Jan. 5, 1961.

Shapiro, Rosenfeld, Stalberg & Cook, Harry Shapiro, Hirsh W. Stalberg, Philadelphia, for appellant.

Henry J. Morgan, Edwin P. Rome, Blank, Rudenko, Klaus & Rome, Philadelphia, for appellee.

Before CHARLES ALVIN JONES, C. J., and BELL, MUSMANNO, BENJAMIN R. JONES, COHEN, BOK and EAGEN, JJ.

COHEN, Justice.

Howard Scott, appellee, now deceased, brought this action in assumpsit to recover monies allegedly due under an employment contract between appellee and the Philadelphia Parking Authority, appellant, increasing appellee's annual salary as managing director of the Authority to $15,000. The Authority answered, denying the validity of the contract and contending that because it was entered into by prior members of the Authority for a proposed term to extend beyond the appointed terms of each of the prior members, it could not bind the succeeding members of the Authority. In addition, the Authority filed a counterclaim for those monies paid to appellee at the rate of $15,000 a year which exceeded the $10,000 rate for which the appellee had previously contracted. The court below, finding the agreement to be fair, just and reasonable, prompted by the necessities of the situation and advantages to the public at the time it was entered into, entered judgment for the appellee. This appeal followed.

The Philadelphia Parking Authority is a public corporate body created by the Philadelphia City Council under the authority of the Act of June 5, 1947, P.L. 458, as amended, 53 P.S. § 341 et seq. Its primary purpose is to promote the public safety, convenience and welfare by providing offstreet parking facilities so as to alleviate parking and traffic problems. The Authority has five members appointed by the Mayor of the City of Philadelphia to serve without compensation for staggered five year terms so that the term of one member will expire each year. Under its enabling legislation, Act of June 5, 1947, supra, the Authority is granted 'all powers necessary or convenient for the carrying out of the aforesaid purposes' including the power '* * * (7) To appoint officers, agents, employees and servants; to prescribe their duties and to fix their compensation;' and the power '* * * (10) To make contracts of every name and nature, and to execute all instruments necessary or convenient for the carrying on of its business.' § 5, 53 P.S. § 345.

Appellee was the first managing director of the Philadelphia Parking Authority. His employment commenced sometime in 1950 at a starting salary of $300 a month. As of September, 1953, however, appellee was under written contract with the Authority, dated April 23, 1952, providing for a three year term of employment as managing director at a salary of $10,000 a year. On September 23, 1953, having determined that the $10,000 annual salary was not commensurate with the responsibility the appellee had been obliged to assume, the then members of the Authority unanimously resolved to offer appellee a new contract of employment for a term of three years at an annual salary of $15,000, to be effective September 1, 1953.

The offer was accepted by the appellee. The three year term included therein clearly extended beyond the appointed term of office of every member then on the Authority. ¹

Shortly thereafter, the members of the Authority who authorized the new agreement were replaced by new members. Nevertheless, payments at the rate of $15,000 a year were made to appellee until January 27, 1954, after which date the new members of the Authority, questioning the validity of the agreement in issue, reduced the appellee to the basis of his $10,000 salary without prejudice to his claim to be paid at the rate of $15,000. Appellee remained as managing director until November 30, 1956, at which time he was discharged. He then instituted this suit, claiming damages for some $13,125 which represents, with appropriate adjustments, the difference between the two salaries. The Authority's counterclaim was based on the asserted overpayments between September 1, 1953 and January 27, 1954 (i. e., payments at the $15,000 instead of the $10,000 annual rate).

We are asked to determine the validity of a contract which gives an appointed employee of a public authority a tenure for a period of three years at a fixed salary. The primary issue as we see it is not, as the parties have argued, whether the instant contract is unenforceable as an attempt to bind the succeeding members of the Authority, but whether the making of the contract in the first place was beyond the power of the Authority and hence initially invalid.

Without more, an appointed public employee takes his job subject to the possibility of summary removal by the employing authority. He is essentially an employee-at-will. As we said in Mitchell v. Chester Housing Authority, 1957, 389 Pa. 314, 328, 132 A.2d 873, 880, with reference to a state agency employee but applicable in general, '* * * good administration requires that the personnel in charge of implementing the policies of an agency be responsible to, and responsive to those charged with the policy-making function, who in turn are responsible to a higher governmental authority, or to the public itself, whichever selected them. This chain of responsibility is the basic check on government possessed by the public at large.' The power to dismiss summarily is the assurance of such responsibility.

Tenure in public employment, in the sense of having a claim to employment which precludes dismissal on a summary basis, is, where it exists, a matter of legislative grace. It represents a policy determination that regardless of personality or political preference or similar intangibles, a particular job, to be efficiently fulfilled, requires constant and continuous service despite changes in political administration. In general, the legislature has conferred tenure as an integral part of a comprehensive governmental employment scheme such as those embodied in the Civil Service Act ² or the Teacher Tenure Acts. ³ These legislative directives, and regulations promulgated thereunder, set forth in great detail the minimal requirements an employee must meet in order to secure initially governmental employment, the standards for advancement of such an employee, job classifications for remunerative purposes, and the requisites for discharge. Importantly, it is not until an employee has qualified under the systems that he is entitled to his tenure rights. See Templeton Appeal, 1960, 399 Pa. 10, 159 A.2d 725.

Furthermore, where the legislature has intended that tenure should attach to public employment, it has been very explicit in so stating. Professional employees in our public school system, as the term is defined in the Public School Code, ⁴ are expressly covered. The Civil Service Act itself expressly denominates certain state departments, boards and commissions to which its terms apply, ⁵ and under Section 212 of the Act sets forth the machinery whereby '* * * other State departments, boards, commissions, or agencies and political subdivisions of this Commonwealth * * *.' may obtain the services and facilities of the Civil Service Commission and its staff. ⁶ State employees administering the Unemployment Compensation Act and the Liquor Code are specifically subjected to civil service coverage and protection by the very terms of the statutes. ⁷ See also the system statutorily outlined for employing personnel for the Pennsylvania Board of Parole ⁸ and the advisory health board under the State Department of Health. ⁹

Where, then, is the legislative expression that the Authority has the power to create tenure by contract?

The power granted to the Authority under its enabling legislation is to appoint officers, employees and agents and to fix their compensation, not to enter into contracts of employment. Clearly, absent the contract, the Authority would have had the power to discharge the appellee summarily. If the Authority has the power to contract away this right which under sound principles of law and public policy is fundamental to a scheme of good government, it must be set forth expressly in the enabling legislation. A studied examination of the Act of June 5, 1947, discloses that not to be the case here.

A power to confer tenure by contract most assuredly does not derive from the general grant of powers necessary and convenient to carry out the purposes of the Authority, nor from the general power to make contracts of every name and nature. Each of these grants of broad power relates to those other powers necessary to carry on the business and proprietary functions of the Authority and cannot be read to include the power to contract away the right of summary dismissal. Similarly, we are not here concerned with contracts for work on particular and specific projects being carried out by a governmental body which might necessitate the temporary services of some specialist. See Beloff v. Margiotti, 1938, 328 Pa. 432, 197 A. 223; Light v. Lebanon County, 1928, 292 Pa. 494, 141 A. 291; Moore v. Luzerne County, 1918, 262 Pa. 216, 105 A. 94; McCormick v. Hanover Township, 1914, 246 Pa. 169, 92 A. 195. The contract here called for the employment on an annual basis of a close and confidential employee of a public body responsible for its daily management and supervision. As such, it directly concerned the organizational scheme of the Authority and had to accord with the legislative mandate. The enabling act calls for appointed officers, agents and employees necessarily responsible to the members of the Authority, themselves appointees, all of whom are subject to summary dismissal. ¹⁰ Since no legislative authority exists which permits a contract of this nature, the instant contract is invalid and unenforceable in its entirety.

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