COMMONWEALTH of Pennsylvania, DEPARTMENT OF PUBLIC WELFARE, Appellant, v. Irving PORTNOY, Esquire: John Quinn, Esquire, Evans, Rosen, Portnoy, Quinn and Donohue a law firm and partnership, Appellees.
Commonwealth Court of Pennsylvania.
Nov. 3, 1989.
Reargued Oct. 4, 1989.
566 A.2d 336
PALLADINO, Judge.
Argued Feb. 4, 1989.
Finally, on the merits, the approval of leases, automobile sales and sole source contracts are not financial transactions. Clearly, there would be a financial transaction in the future as a result of the award of contracts. However, the Auditor General is not involved in that part of the transaction which she subsequently audits. The statutory and constitutional prohibitions exist to prevent the Auditor General from auditing her own work. The Board‘s general approval or disapproval of contracts and leases is not a financial transaction which is later audited.
Therefore, I would dismiss the petition for review or alternatively deny summary judgment.
William R. Caroselli, Caroselli, Spagnolli & Beachler, Pittsburgh, for appellees.
Argued Feb. 4, 1989
Argued before CRAIG and PALLADINO, JJ., and NARICK, Senior Judge.
Reargued Oct. 4, 1989
Reargued before CRUMLISH, Jr., President Judge, and CRAIG, BARRY, COLINS, PALLADINO, McGINLEY and SMITH, JJ.
The Commonwealth of Pennsylvania, Department of Public Welfare (DPW) appeals from an order of the Court of Common Pleas of Allegheny County (trial court) sustaining the preliminary objections of Irving Portnoy, John Quinn, and Evans, Rosen, Portnoy, Quinn, and Donohue (collectively, Appellees) and dismissing the complaint of DPW without leavе to amend. For the reasons set forth below, we affirm.
On March 2, 1988, DPW filed a complaint in equity with the trial court, alleging that Appellees currently represent, and have represented in the past, numerous medical assistance recipients in actions to recover damages, for personal injuries, from third party tortfeasors or their insurers. DPW pleaded that, under section 1409(b) of the Public Welfare Code (Code),1 it has a right to a first lien on the proceeds of any judgment, award or settlement which reimburses a medical assistаnce recipient for medical bills incurred for the treatment of personal injuries for which another person was responsible. DPW further averred that section 1409(b) of the Code,
DPW averred that Appellees were aware of the foregoing notice provisions yet knowingly and intentionally failed to give DPW the requisite notice of suit, judgments/awards/settlements, and opportunity to perfect its liens. DPW alleged that Appellees’ failure to so notify DPW was an attempt to defraud DPW of monies to which it was entitled. DPW alleged that it became aware of some cases in which Appellees had failed to notify DPW as
In its prayer for relief, DPW sought: (1) a declaratory judgment that Aрpellees were required to comply with section 1409(b) of the Code,
On March 10, 1988, Appellees filed preliminary objections to the complaint, including a preliminary objection in the nature of a demurrer.3 DPW thereafter filed a first amended complaint on March 14, 1988. On April 4, 1988, Appellees filed a second set of preliminary objections, which set forth the same objections as their original objections and, in addition, contained a motion to strike because of a change in the party plaintiff without leave of court or consent of Appellees.
On appeal to this court, DPW argues that it should have been permitted to maintain a cause of action against Appellees for damages where it has alleged that it is unable to obtain reimbursement of medical assistance payments as a result of Appellees’ knowing and intentional failure to сomply with section 1409(b) of the Code,
Initially, we note that preliminary objections in the nature of a demurrer will be sustained only where a complaint is clearly insufficient to establish any right to relief; any doubt must be resolved in favor of the pleader. County of Allegheny v. Commonwealth of Pennsylvania, 507 Pa. 360, 490 A.2d 402 (1985). A demurrer admits as true all well-pleaded facts, but does not admit conclusions of law, unwarranted inferences from facts, argumentative allegations, or expressions of opinion. Martin v. Commonwealth, 124 Pa. Commonwealth Ct. 625, 556 A.2d 969 (1989). In order to review DPW‘s claims for relief in this case of first impression, we must first examine Article XIV of the Code,
ARTICLE XIV OF PUBLIC WELFARE CODE
Article XIV of the Code, entitled “Fraud and Abuse Control,” sets forth a detailed scheme of provider prohibited acts and recipient prohibited acts.6 Section 1407(a) of the Code,
Section 1408 of the Code,
Section 1409(b) of the Code,
Section 1409(b)(7) provides that, where the action against a third party or insurer is brought by the beneficiary alone, the court shall order that reasonable litigation expenses and attorney‘s fees be paid first from any judgment or award.
Section 1409(b)(10) provides that where DPW has perfected a lien upon a judgment or award in favor of a beneficiary against a third party for an injury for which the beneficiary has received medical assistance benefits, DPW shall be entitled to a writ of execution as lien claimant to enforce payment of the lien against the third party with interest and costs.
DPW asserts that the foregoing statutory provisions, permitting DPW to seek reimbursement from a third party tortfeasor or the recipient of medical assistance benefits,
Except as otherwise provided in this act, notwithstanding any other provision of law, the entire amount of any settlement of the injured beneficiary‘s action or claim, with or without suit, is subject to the department‘s claim for reimbursement of the benefits provided any lien filed pursuant thereto, but in no event shall the department‘s claim exceed one-half of the bеneficiary‘s recovery after deducting for attorney‘s fees, litigation costs, and medical expenses relating to the injury paid for by the beneficiary.
However, we note that, in contrast to sections 1407 and 1408 of the Code,
PUNITIVE DAMAGES AND ATTORNEY‘S FEES
Similarly, DPW contends that the trial court erred in concluding that it could not recover attorney‘s fees, costs or punitive damages. As noted above, where the legislature has specifically provided civil and criminal remedies and sanctions against providers and recipients, this court will not attempt to rewrite a statute to supply additional remedies against attorneys. While we are sympathetic to the concerns оf DPW in this case in preventing welfare abuses, careful review of section 1409(b) of the Code,
DECLARATORY AND INJUNCTIVE RELIEF
Finally, DPW contends that the trial court erred in concluding that DPW was not entitled to equitable relief in this case. DPW sought, in its first amended complaint, a declaration that Appellees must comply with the notice provisions of section 1409(b) of the Code,
DPW asserts that the trial court erred in denying injunctive relief in this case. DPW sought an injunction prohibiting Appellees from failing to give notice under section 1409 of the Code,
The trial court concluded that the absence of legal and/or equitable remedies as to attorneys in article XIV of the Code precluded it from granting an injunction. Further, the trial court stated that a mandatory injunction “should not be granted when its enforcement will require too great an amount of supervision by the court.” Commonwealth of Pennsylvania v. Portnoy, (Civil Division, No. GD88-03677, filed May 3, 1988), slip op. at 20. We agree. This court has held that a party seeking a mandatory injunction must present a stronger cаse than that required for an injunction which restrains action. Allen v. Colautti, 53 Pa. Commonwealth Ct. 392, 417 A.2d 1303 (1980). A party must show that he is clearly entitled to immediate relief and that he will suffer irreparable harm if
Accordingly, we affirm.
ORDER
AND NOW, November 3, 1989, the order of the Court of Common Pleas of Allegheny County in the above-captioned matter is affirmed.
CRAIG, Judge, dissenting.
Are the courts of this Commonwealth powerless to require that attorneys-at-law—officers of the court—obey the statutory law which clearly requires them to give notice to the Department of Public Welfare (DPW) of suits against third parties on behalf of public assistance beneficiaries?
Because the statutory duty is clear and explicit, its violation constitutes irreparable injury as a matter of law, and there is no other remedy at law, by statute or otherwise, hence the judicial power and duty to enjoin disobedience of the legislative mandate is plain. Berman v. Philadelphia, 425 Pa. 13, 228 A.2d 189 (1967).
1. The Legal Duty Is Clear
Section 1409(b)(12) of the Public Welfare Code, Act of June 13, 1967, P.L. 31 as amended,
(12) In the event that the beneficiary ... brings an action against the third person whom may be liable for the
injury, notice of institution of legal proceedings, notice of settlement, and all other notices required by this act shall be given to the Secretary.... All such notices shall be given by the attorney retained to assert the beneficiary‘s claim, or by the injured party beneficiary ... if no attorney is retained. (Emphasis added.)
This court should not give license to any member of the Bar to ignore that explicit legal duty, enacted by the elected lawmakers and obviously designed to facilitate reimbursement to the public treasury, when proper, so that the public assistance program may aid as many citizens as possible.
2. Violation of Law Necessarily Imports Immediate and Irreparable Harm
With respect to neсessity of supporting injunctive relief by the existence of immediate and irreparable harm, this court has stated:
This traditional prerequisite to the issuance of an injunction is not applicable where as here the Legislature declares certain conduct to be unpermitted and unlawful. For one to undertake and pursue such statutorily prohibited conduct constitutes irreparable injury which is the proper subject of injunctive relief. Pennsylvania Public Utility Commission v. Israel, 356 Pa. 400, 52 A.2d 317 (1947).
City of Erie v. N.W. Pa. Food Council, 14 Pa.Commonwealth Ct. 355, 364, 322 A.2d 407, 412 (1974).
In Pa. P.U.C. v. Israel, 356 Pa. 400, 52 A.2d 317, the Supreme Court approved Judge Woodside‘s oft-quoted statements on the subject:
When the Legislature declares certain conduct to be unlawful it is tantamount in law to calling it injurious to the public. For one to continue such unlawful conduct constitutes irreparable injury.
Israel, 356 Pa. at 406, 52 A.2d at 321.
To allow violation of the statutory mandate in this case, by one group of attorneys, is to allow the thousands of
3. Injunсtive Relief Is Proper Because No Alternative Relief Exists
Although equitable relief is not available when an adequate remedy by common law or statute exists, and has not been exhausted, this court is apparently unanimous in agreeing that neither statute nor common law provide the Commonwealth with any remedy against the attorneys, so that, accordingly, injunctive compulsion is fully warranted.
If, as the majority opinion here holds, the state cannot recover damages from the lawyers when their violation of the notice requirement results in loss to the public treasury, there is no adequate common law remedy available.
Because the majority opinion also rightly notes that the Public Welfare Code contains no statutory provisions to implement performance of the lawyers’ notice duty, there is no alternative statutory remedy. And, with no alternative statutory remedy provided against the lawyers, this court certainly cannot withhold equitable relief to the Commonwealth on the ground that DPW has failed to exhaust a statutory remedy against the lawyer appellees.
The availability of some statutory remedies against public assistance beneficiaries does not, in law or logic, constitute a remedy against the attorney‘s duty to give notice. A remedy against public assistance recipients, particularly if delayed by lack of notice, is not likely to be productive in any practical sense, and will therefore not be adequate. Without notice from the counsel who are prosecuting proceedings against third-party defendants, the state‘s remedies to obtain reimbursement from beneficiaries become meaningless. For example, possession of a lien on proceeds, such as the law here gives the state, is of no significance if there is no notice of the lien‘s existence.
Conclusion
Issuance of the injunction, to require obedience to the law and thereby to support the strength and fairness of the public assistance system, is warranted in every respect.
BARRY and McGINLEY, JJ., join in this dissent.