Summit Sch., Inc. v. Commonwealth

• Decision Date: 15 January 2015
• Docket Number: No. 20 M.D. 2011,20 M.D. 2011
• Citation: 108 A.3d 192
• Parties: The SUMMIT SCHOOL, INC., t/d/b/a Summit Academy, Petitioner v. COMMONWEALTH of Pennsylvania, DEPARTMENT OF EDUCATION, Respondent.
• Court: Pennsylvania Commonwealth Court

108 A.3d 192

The SUMMIT SCHOOL, INC., t/d/b/a Summit Academy, Petitioner

v.COMMONWEALTH of Pennsylvania, DEPARTMENT OF EDUCATION, Respondent.

No. 20 M.D. 2011

Commonwealth Court of Pennsylvania.

Argued Nov. 13, 2014.

Decided Jan. 15, 2015.

James H. Norris, Jr., Pittsburgh, for petitioner.

Howard G. Hopkirk, Harrisburg, for respondent.

BEFORE: DAN PELLEGRINI, President Judge, and RENÉE COHN JUBELIRER, Judge, and MARY HANNAH LEAVITT, Judge.

Opinion

OPINION BY Judge COHN JUBELIRER.

Before this Court, in our original jurisdiction, are the Motion for Summary Judgment filed by The Summit School, Inc., t/d/b/a Summit Academy (Academy) (Academy's Motion) and the Motion for Summary Relief filed by the Commonwealth of Pennsylvania, Department of Education (Department) (Department's Motion) in this declaratory judgment action (Amended Complaint) filed by the Academy.¹ The parties agree that there are no outstanding issues of material fact and argue that they are entitled to judgment as a matter of law on the proper interpretation and implementation of Section 2561(6) of the Public School Code of 1949 (School Code).² The question before this Court is whether, pursuant to Section 2561(6) of the School Code, the Department has to reimburse the Butler Area School District (District) in the amount of 150% of the District's tuition rate for the non-resident students the Academy educates on the District's behalf pursuant to a contract between the District and the Academy.

I. Background

The Academy seeks a declaratory judgment under the Declaratory Judgments Act³ requiring the Department to reimburse the District, with which the Academy has a contract, the 150% tuition rate set forth in Section 2561(6) of the School Code. The Amended Complaint⁴ avers the following. The Academy is a residential facility for adjudicated delinquents that is licensed by both the Department of Human Services (formerly the Department of Public Welfare) to provide care for up to 353 students, and by the Department as a private academic secondary school. (Amended Compl. ¶¶ 5–7.) Since 1997, the District has had a contract with the Academy to fulfill the District's “obligation to administer and deliver educational services to students at the Academy,” pursuant to Section 1306(a) of the School Code⁵ (Agreement). (Amended Compl. ¶¶ 8, 10.) The Agreement for the 1999–2000 school year is attached to the Amended Complaint as Exhibit A. According to a Department Basic Education Circular (BEC), which is attached to the Amended Complaint as Exhibit B, a host school district, like the District, is permitted to “contract with another educational entity to provide the education of students at the institution” and allows the host school district to finance that contract by “charging the ... resident school district [ (home school district) ] the tuition rate as determined by [Section 2561] of the School Code.” (Amended Compl. ¶¶ 12, 14–15; BEC at 1.)

In 2001 and 2002, the District billed the home school districts, i.e., the districts where the Academy's students would have attended school had they not been adjudicated delinquent, the 150% rate. (Amended Compl. ¶ 19.) On behalf of the home school districts, the Department paid that rate to the District, which then remitted that money to the Academy less an administrative fee. (Amended Compl. ¶ 19.) The actual cost of educating the students at the Academy exceeds the 150% rate. (Amended Compl. ¶ 20.) Beginning in 2003, the Department refused to reimburse the District at the 150% rate, instead reimbursing it for 100% of the District's tuition rate. (Amended Compl. ¶ 21.) The Department challenged the 150% rate, and the Academy believes the Department also advised at least one home school district that it was paying too much. (Amended Compl. ¶ 23.) The Academy asserts that the Department is violating Section 2561(6) of the School Code by not paying the 150% rate, thereby forcing the Academy to bear additional expenses for educating the non-residential students that should be paid by the Department. (Amended Compl. ¶¶ 33, 35.)

The Department filed Preliminary Objections (POs) to the Amended Complaint asserting that the Academy lacked standing, failed to join all of the home school districts as indispensable parties, and failed to state a claim upon which relief could be granted.⁶ This Court overruled the Department's POs, and directed the Department to file an answer. Summit School, Inc. v. Department of Education , 2011 WL 10819518 (Pa.Cmwlth., No. 20 M.D. 2011, filed December 1, 2011). On January 13, 2012, the Department filed its Answer to the Complaint (Answer) indicating that the majority of the averments in the Amended Complaint were legal conclusions to which no response was needed. The Department admits that it paid the District the 150% rate for non-resident students, who are wards of the state and have no home school district, for the 1999–2000 and 2000–2001 school years, but believes that it overpaid in those years and, beginning in 2003, paid the District the 100% rate.⁷ (Answer ¶¶ 19, 21.) The Department also raised New Matter, to which the Academy filed an Answer indicating that no response was required because the Department's allegations were conclusions of law.⁸

II. Cross–Motions for Summary Relief

The Academy and the Department seek summary relief, agreeing that the resolution of their claims regarding the proper level of tuition reimbursement lies in the interpretation of Section 2561(6) of the School Code. Both assert that the plain language of this section supports their respective positions. Moreover, both contend that, if this Court finds the language to be ambiguous, the rules of statutory interpretation support their own reading of Section 2561(6) of the School Code.

Rule 1532(b) of the Pennsylvania Rules of Appellate Procedure addresses applications for summary relief filed with this Court, and provides that: “[a]t any time after the filing of a petition for review in an appellate or original jurisdiction matter the court may on application enter judgment if the right of the applicant thereto is clear.” Pa. R.A.P. 1532(b). We must determine, based on the undisputed facts, whether “either party has a clear right to the relief requested.” Bell Atlantic–Pennsylvania, Inc. v. Turnpike Commission, 703 A.2d 589, 590 (Pa.Cmwlth.1997). The record, for purposes of the motion for summary relief, is the same as a record for purposes of a motion for summary judgment. Meggett v. Pennsylvania Department of Corrections, 892 A.2d 872, 879 n. 13 (Pa.Cmwlth.2006). Rule 1035.1 of the Pennsylvania Rules of Civil Procedure provides that the record in a motion for summary judgment includes any: “(1) pleadings, (2) depositions, answers to interrogatories, admissions and affidavits, and (3) reports signed by an expert witness that would, if filed, comply with Rule 4003.5(a)(1), whether or not the reports have been produced in response to interrogatories.” Pa. R.C.P. No. 1035.1. “The record must be viewed in the light most favorable to the non-moving party, and all doubts as to the existence of a genuine issue of material fact must be resolved against the moving party.” Baker v. City of Philadelphia, 145 Pa.Cmwlth. 421, 603 A.2d 686, 688 (1992).

However, before we address the meaning of Section 2561(6), we must first consider the Department's filing of two sworn Declarations, with attachments, from Department employees in support of the Department's Motion and the Academy's objections thereto. These employees were involved in reviewing tuition reimbursement requests, explained their procedures for doing so, and indicated that the Department's reimbursement to the District at the higher tuition rate was the result of an administrative error and contrary to the Department's policy. (Nelson Declaration ¶¶ 8–9; Rogers Declaration ¶ 8.) Based on these Declarations, the Department argues it may not be estopped from properly enforcing or administering the School Code because its employees failed to properly do so in the past. See Commonwealth v. Western Maryland R.R. Co., 377 Pa. 312, 105 A.2d 336, 340–41 (1954) (“It is a fundamental legal principle that a State or other sovereignty cannot be estopped by any acts or conduct of its officers or agents in the performance of a governmental as distinguished from a proprietary function.”); Department of Environmental Resources v. Philadelphia Suburban Water Company, 135 Pa.Cmwlth. 283, 581 A.2d 984, 990 (1990) (“[A]n agency cannot be estopped from performing its statutory duties.”). The Academy asks that these Declarations and attachments be stricken because these documents are not in the record, which is closed, and the Department improperly relies upon them to support its arguments.

After reviewing the Declarations and attachments, we note that they simply reiterate the Department's arguments regarding its policy toward tuition reimbursement under Section 2561(6). The relevant information contained within the Declarations and attachments that the Department seeks to rely upon is not factual in nature. Rather, the statements therein relate to the legal question of the Department's interpretation of Section 2561(6), which the Department has already set forth in its Answer, the Department's Motion, and its brief to this Court. Thus, the Declarations and attachments do not provide anything additional for this Court to consider in determining whether to grant summary relief. We now turn to the main question before this Court, ascertaining the meaning of Section 2561(6) of the School Code.

The touchstone of interpreting statutory language is to ascertain and effectuate the intent of the legislature. Section 1921 of the Statutory Construction Act of 1972 (SCA), 1 Pa.C.S. § 1921(a) ; Colville v. Allegheny County Retirement Board, 592 Pa. 433, 926 A.2d 424, 430–31 (2007). A guiding principle of statutory construction is that, “[w]hen the words of a statute are clear and free from all ambiguity, the...