Vecchione v. Wohlgemuth

• Decision Date: 13 January 1977
• Docket Number: Civ. A. No. 73-162.
• Citation: 426 F. Supp. 1297
• Parties: Elvira VECCHIONE, Plaintiff, v. Helene WOHLGEMUTH et al., Defendants. Walter BURESS, Individually and on behalf of all others similarly situated, Plaintiff-Intervenor, v. Frank BEAL et al., Defendants.
• Court: U.S. District Court — Eastern District of Pennsylvania

426 F. Supp. 1297

Elvira VECCHIONE, Plaintiff, v. Helene WOHLGEMUTH et al., Defendants.

Walter BURESS, Individually and on behalf of all others similarly situated, Plaintiff-Intervenor, v. Frank BEAL et al., Defendants.

Civ. A. No. 73-162.

United States District Court, E. D. Pennsylvania.

January 13, 1977.

COPYRIGHT MATERIAL OMITTED

COPYRIGHT MATERIAL OMITTED

Judy Greenwood, Jonathan M. Stein, Philadelphia, Pa., for plaintiff.

David Ferleger, Philadelphia, Pa., for plaintiff-intervenor.

Allen C. Warshaw and Norman J. Watkins, Deputy Attorneys General, Harrisburg, Pa., for defendant.

Before HUNTER, Circuit Judge, and TROUTMAN and BECKER, District Judges.

OPINION AND ORDER

EDWARD R. BECKER, District Judge.

I. Preliminary Statement

On July 11, 1974, we filed a three-judge court opinion in this 42 U.S.C. § 1983 case which deals with the

right of patients confined in state mental hospitals in Pennsylvania to control and manage their own property as against: (1) the right of the Commonwealth to summarily seize and control it for the duration of the hospitalization, without prior notice or hearing on the issue of the patient's competency to control that property; and (2) the right of the Commonwealth to appropriate part of the patient's property in satisfaction of the cost of care and maintenance without prior or subsequent hearing on the correctness of the Commonwealth's assessment.

377 F.Supp. 1361, 1362 (E.D.Pa.1974). The "bottom line" of that opinion was a declaration that § 424 of the Pennsylvania Mental Health and Mental Retardation Act of 1966, 50 P.S. § 4424, read in conjunction with § 501 of that Act, 50 P.S. § 4501, offended the equal protection and due process clauses of the Fourteenth Amendment. We issued an injunction (hereinafter "original decree") against the further application of section 424. No appeal was taken.

We were aware when we filed our opinion that compliance with the original decree required major changes in the manner of handling the funds of mental patients in Pennsylvania institutions and that implementation could not be accomplished overnight.¹ We could not have anticipated, however, that almost two-and-one-half years after the original decree we would be filing the present opinion deciding motions interposed by state officials attacking its validity on the grounds that we had adjudicated a case not before us, and that we thus lacked subject matter jurisdiction. Nor could we have perceived that the case would proceed to the point where the Commonwealth would attempt to repudiate the instrument finally devised for implementing the original decree a consent decree entered on April 4, 1975, (hereinafter "consent decree"), on the grounds that the general counsel for the Pennsylvania Department of Welfare who signed the consent decree and submitted it to the Court was unauthorized to do so.

An understanding of the present motions requires a brief description of the interim history of the case. After our July 11, 1974 decision we heard nothing until early 1975 when counsel for plaintiff and an intervening plaintiff² moved that the defendants, including Secretary of Welfare Frank S. Beal, be adjudged in contempt for failure to comply with the original decree. There followed a period of negotiation, pursuant to which the parties entered into a stipulation for the consent decree. The consent decree incorporated comprehensive regulations to be adopted by the Pennsylvania Department of Public Welfare as a means of implementing the original decree. The stipulation included provisions for repayment to mental patients of sums withheld pursuant to the statutory procedure which we invalidated. The stipulation was signed on the Commonwealth's behalf by Assistant Attorney General Marx S. Leopold who was General Counsel for the State Department of Welfare, and by Assistant Attorney General Cecil Maidman who, along with Leopold, had conducted the litigation on the defendants' behalf before the three-judge court. The consent decree was approved by the undersigned on April 4, 1975. The regulations were personally approved by defendant Frank S. Beal, Secretary of Welfare, and approved as to legality by the Pennsylvania Department of Justice. They were published in the Pennsylvania Bulletin on April 19, 1975, and certification of publication was filed with the Court.

The consent decree did not end the undersigned's involvement in the matter, for notwithstanding the new regulations it appeared that the problems involved in implementation could benefit from the mediation efforts of the Court, and we embarked upon a series of implementation conferences.³ First, the problems of obtaining suitable guardians for the small funds involved (most banks were uninterested) were not inconsiderable, and a dispute arose between counsel as to the appropriate means of handling the matter. In the many implementation conferences, a variety of options were explored.⁴ Second, the processing of the many Guardian Petitions required by the two Vecchione decrees met with resistance from the State Court system which contended that it was understaffed and ill-equipped to handle the enormous volume of necessary petitions.⁵ However, through mediation, we were able to stave off a constitutional confrontation among the State and Federal Courts (see n. 5) and the State Attorney General, who with the cooperation of the State Court Administrator is now moving ahead with the processing of the Vecchione guardian petitions. Third, there arose a dispute between counsel as to the Welfare Department's procedure for preliminary determinations of competency pursuant to the consent decree, and we mediated that as well.

The biggest problem, however, did not involve any of the foregoing, but was, as is so often the case, a matter of money. At one of our implementation conferences it appeared that the Commonwealth had withheld from mental patients after the original decree some 9.1 million dollars which it was bound to repay by the terms of the consent decree; i. e., notwithstanding the original decree the revenue agents had continued to seize and appropriate patients' money up until April 4, 1975 with the result that virtually all of it was returned by the revenue agents to the State Treasury general fund in payment of care and maintenance. The Commonwealth was unable at the time to free up the funds for repayment.⁶ Moreover, the Commonwealth began to contend that the repayment of such sums would violate the Eleventh Amendment to the Constitution and that the consent decree was signed by Assistant Attorneys General who lacked power or authorization. Additionally, the Commonwealth began to question the viability of the original decree by asserting that counsel in presenting the case had failed to inform the court that Mrs. Vecchione's funds, and the vast bulk of the funds held by Revenue Department Agents (hence affected by the original decree) were funds received from the Social Security Administration (or other federal agencies such as the Railroad Retirement Board) which the Pennsylvania Revenue Department Agents were holding, not subject to section 424, but pursuant to representative payee procedures established by agreement with the Social Security Administration (or other agency). As Mr. Leopold put it in a "Petition for Clarification" filed on July 10, 1975, the Court and plaintiffs and defendants "apparently assumed" that the funds at issue were section 424 funds but they (allegedly) were not.

Further implementation conferences with the undersigned continued.⁷ The Commonwealth had designated Deputy Attorney General Donald Murphy, a high level Justice Department official, to act as the Commonwealth's representative, and Mr. Murphy attended the various conferences along with Joseph Kennedy, Esquire, Chief of the Revenue Department's Bureau of Institutional Collections, Paul Carey, the new General Counsel for the Welfare Department, and representatives of the Social Security Administration, including a regional representative, Mr. Thomas L. Toole, and an HEW attorney Larry Bailine. Notwithstanding the allegations of the "Petition for Clarification," the Commonwealth represented at these conferences that the monies in question would be repaid;⁸ moreover, Mr. Toole represented that the Social Security Administration would abide by the Vecchione decree.

We heard nothing for some time and had thought that the problems were solved. However, on February 18, 1976, the Commonwealth defendants filed a Motion to Vacate and/or Modify the Consent Decree. At conferences following the filing of the motion the Commonwealth attorneys first took the position that they attacked only the consent decree, not the original decree. In due course, however, it appeared that they were attacking both. Because it appeared that resolution of the issues posed by the Commonwealth's motion might take some time, we continued our implementation conferences, and worked out two Interim (Implementation) Orders, dated May 26, 1976. The Commonwealth agreed to advance implementation, because it has at all times stated that it agrees with the principles of the July 11, 1974 Vecchione opinion, except those sequellae which it is litigating.

The motion to vacate and/or modify is founded upon Fed.R.Civ.P. 60(b). Inter alia, it raises those questions about subject matter jurisdiction, the Eleventh Amendment, and the validity of the consent decree to which we have already referred. The plaintiffs filed an answer, not only countering the allegations of the motion, but also suggesting with considerable force that what the defendants were attempting to do was to relitigate a two-year old decree.

A briefing schedule was established, depositions were taken, and on September 30, 1976, a hearing on the motion was held before the three-judge court. The hearing consisted mainly of legal argument: the evidentiary foundation was supplied by a stipulation based upon the various...