Vecchione v. Wohlgemuth

• Decision Date: 14 June 1977
• Docket Number: No. 76-2631,76-2631
• Parties: Elvira VECCHIONE and Walter Buress and all other persons similarly situated v. Helene WOHLGEMUTH, Secretary, Department of Public Welfare, Commonwealth of Pennsylvania, Franklyn R. Clarke, M. D., Superintendent, Philadelphia State Hospital at Byberry, Elwood N. Shoemaker, Revenue Agent, Philadelphia State Hospital at Byberry, Frank Beal et al., Defendants-Appellants.
• Court: U.S. Court of Appeals — Third Circuit

Page 150

558 F.2d 150

Elvira VECCHIONE and Walter Buress and all other persons similarly situated

v.

Helene WOHLGEMUTH, Secretary, Department of Public Welfare Commonwealth of Pennsylvania, Franklyn R. Clarke, M. D. Superintendent, Philadelphia State Hospital at Byberry Elwood N. Shoemaker, Revenue Agent, Philadelphia State Hospital at Byberry, Frank Beal et al., Defendants-Appellants.

No. 76-2631.

United States Court of Appeals Third Circuit.

Argued March 29, 1977.

Decided June 14, 1977.

Norman J. Watkins, Allen C. Warshaw, J. Justin Blewitt, Jr., Deputy Attys. Gen., Chief, Civil Litigation, Robert P. Kane, Atty. Gen., Department of Justice, Harrisburg, Pa., for appellants.

David Ferleger, Judy Greenwood, Jonathan M. Stein, Philadelphia, Pa., for appellees.

Before VAN DUSEN, GIBBONS and GARTH, Circuit Judges.

OPINION OF THE COURT

GIBBONS, Circuit Judge.

This case involves an appeal from a denial of a motion, pursuant to Fed.R.Civ.P. 60(b), to vacate a consent decree. Vecchione v. Wohlgemuth, 426 F.Supp. 1297 (E.D.Pa.1977). The consent decree was entered in settlement of a contempt proceeding against certain officials of the Commonwealth of Pennsylvania, who defied an injunctive order of a three-judge federal district court. That injunctive order, which is not before us for review, resulted from a fully litigated case. We affirm the denial of the Rule 60(b) motion.

On January 19, 1973, Elvira Vecchione filed a complaint on her own behalf and on behalf of a class consisting of patients in Commonwealth mental hospitals who were not adjudicated incompetent to manage their own property. The gravamen of the complaint was that sections 424 and 501 of the Pennsylvania Mental Health and Retardation Act of 1966, 50 P.S. §§ 4424 and 4501, were unconstitutional as applied to the plaintiff class, in that the statutes permitted the Commonwealth to take their property in satisfaction of costs of care or maintenance without a prior or subsequent hearing on the correctness of the Commonwealth's assessment. The statutory scheme was alleged to violate the equal protection clause of the fourteenth amendment, in that it permitted such appropriation of the property of competent patients, while it required notice to and hearing for guardians of adjudicated incompetents. It was also alleged to violate the due process clause as interpreted by the Supreme Court. ¹ Since the complaint sought injunctive relief against enforcement of a statute of statewide application a three-judge district court was convened. On February 12, 1973, Marx S. Leopold, Esq., appeared for the defendants, and filed a motion to dismiss the complaint for lack of jurisdiction and failure to state a claim upon which relief can be granted. Thereafter, Assistant Attorney General Leopold participated in litigation of the case in the district court. Eventually the plaintiff prevailed. ² The district court order provided:

"AND NOW, this 11th day of June 1974, IT IS ORDERED, ADJUDGED and DECREED that:

1. Section 424 of the Mental Health and Mental Retardation Act of 1966, 50 P.S. § 4424, is unconstitutional on its face and as applied in violation of the Equal Protection and Due Process Clauses of the Fourteenth Amendment to the United States Constitution to the extent that it denies: (a) plaintiff and other patients who are not adjudged incompetent adequate notice and opportunity to be heard before taking control of these patients' assets under 50 P.S. § 4424 and/or appropriating such assets under 50 P.S. § 4501; and (b) plaintiff and other patients with assets of $2,500 or less the protection of their assets that a guardian or a court would provide if they were adjudged incompetent under the Incompetents' Estates Act of 1955, 50 P.S. § 3101 et seq.

2. The defendants are enjoined from applying 50 P.S. §§ 4424 and 4501 in the unconstitutional manner set forth above.

3. The Commonwealth shall restore to plaintiff all of plaintiff's monies held or taken by the Commonwealth or its agents from October 29, 1971, to April 6, 1973, when plaintiff was hospitalized at the Philadelphia State Hospital at Byberry." (Appendix at 150a).

No appeal was taken from this final judgment, and no Rule 60(b) motion has been addressed to it, despite the fact that it provided for repayment of money.

Seven months later a patient, Walter Buress, alleging that he was a member of the class protected by the decree, moved to intervene. He contended that in defiance of the decree the defendants were continuing to take his social security benefit checks without a hearing, and to apply the proceeds toward what they thought he owed for care and maintenance. He moved to have the defendants held in contempt of court. On March 13, 1975, the district court issued an order directing the defendants and their attorney, Assistant Attorney General Marx S. Leopold, to show cause why they should not be held in contempt.

In fact the court's judgment had never been implemented. Instead, Commonwealth officials had continued to appropriate, without a hearing, social security checks of competent mental hospital patients amounting to several millions of dollars.

The original injunctive decree was merely negative in terms. It prohibited reliance on the existing statutory scheme, but left the Commonwealth free to design an appropriate due process substitute. But until one was designed it was clear that the agents of the Commonwealth were required to cease taking the patients' property. They did not. Faced, in the contempt proceeding, with prospect of a coercive contempt decree, the defendants negotiated with the attorneys for the plaintiff class and with the district court, and on April 4, 1975, entered into a stipulation and order as follows:

AND NOW, this 4th day of April, 1975, upon consideration of the agreement of the parties as to proper procedures and regulations for implementation of this Court's Opinion and Order of July 11, 1974, it is hereby ORDERED and DECREED:

1. The regulations attached hereto as Exhibit A shall be fully adopted by the Defendant Secretary of Public Welfare Frank Beal, on behalf of the Department of Public Welfare, and said regulations shall be published as immediately effective in the Pennsylvania Bulletin within fifteen (15) days. Within twenty (20) days, Defendant Beal, and his counsel, Marx Leopold, shall certify under oath to this Court that such adoption and publication has occurred.

2. The Defendants Beal, Clarke and Shoemaker shall arrange for payment to the named Plaintiff, Elvira Vecchione, in full the sum of $1,253.85, representing the sum wrongfully withheld from her, within ten days. Within fifteen (15) days, said defendants and their counsel, Marx Leopold, shall certify to this Court under oath that such payment has taken place.

3. Defendant Frank Beal, Secretary of the Department of Public Welfare, shall order, within fifteen (15) days, the Directors and Revenue Agents of every state mental institution and facility to determine and report to Defendant Beal the names and addresses of all present and former patients whose funds and property were withheld under 50 P.S. § 4424 or applied to their maintenance under 50 P.S. § 4501 since July 11, 1974, and, in addition, the amounts withheld or applied to maintenance for each such patient or former patient. The Defendant Beal shall obtain and forward these reports to the Court and all plaintiffs' counsel within sixty (60) days of this Order.

4. Within ninety (90) days of this Order, Defendant Beal shall assure that all such amounts withheld under 50 P.S. § 4424 shall be accounted for and that all such amounts applied to maintenance under 50 P.S. § 4501 shall be paid back to the patients or former patients, including interest earned. Such payment shall be accompanied by a full statement of account to all such patients and former patients. Within one hundred (100) days of this Order, Defendant Beal, and his counsel, Marx Leopold, shall file with this Court and all plaintiffs' counsel a statement certifying under oath the names, addresses, amounts withheld or applied to maintenance and amounts paid back to each former or present patient.

5. Plaintiff Walter Buress' uncontested motion to intervene is hereby granted and Defendant Beal shall arrange for payment to Walter Buress of the full sum wrongfully withheld from him since July 11, 1974, such payment to be made within ten (10) days. Within fifteen (15) days, Defendants Beal, and his counsel, Marx Leopold, shall certify to this Court under oath that such payment has taken place.

6. The failure to accomplish any of the above acts by the time specified, or the failure to file required certification with the Court, shall be considered Contempt of this Court and will, after hearing, subject contemnors to fine or other appropriate sanction. The Court shall retain jurisdiction of this matter until the parties shall have fully complied with the terms of this Order.

Exhibit A, attached to the consent order, was a comprehensive set of regulations to be adopted by the Pennsylvania Department of Public Welfare as a means of implementing the original decree. They were personally approved by defendant Beal, Secretary of Welfare, and approved as to legality by the Pennsylvania Department of Justice. They were then duly promulgated in the Pennsylvania Bulletin on April 19, 1975. ³ A certification of the publication was, in accordance with paragraph 1 of the consent order, filed with the Court. The certification also disclosed that repayments had been made to Vecchione and Buress, the named plaintiffs.

Under paragraph 4 of the consent decree the defendants were obliged to account for sums wrongfully taken in violation of the original decree and to have those sums repaid within ninety days. The accounting produced the startling information that the Commonwealth had helped itself to 9.1 million dollars. It soon became clear that despite the decree the fiscal agents of the...