MFW Wine Co., LLC, A6 Wine Company, and GECC2 LLC d/b/a Bloomsday Cafe, Petitioners v. Pennsylvania Liquor Control Board, Respondent
No. 251 M.D. 2020
IN THE COMMONWEALTH COURT OF PENNSYLVANIA
May 27, 2022
BEFORE: HONORABLE RENEE COHN JUBELIRER, Judge; HONORABLE PATRICIA A. McCULLOUGH, Judge; HONORABLE ANNE E. COVEY, Judge; HONORABLE MICHAEL H. WOJCIK, Judge; HONORABLE CHRISTINE FIZZANO CANNON, Judge
Argued: November 17, 2021
OPINION BY JUDGE COVEY
FILED: May 27, 2022
Before this Court is
Background
Before June 8, 2016, SO customers, like Bloomsday Cafe, that wished to purchase a class, variety, or brand of liquor or alcohol not then available from a PLCB Fine Wine and Good Spirits store (PLCB Store) could place SOs for the items with licensed importers or vendors, like MFW or A6. However, the licensed importers or vendors were required to deliver
On June 8, 2016, by enacting Section 3 of Act 39,4 the General Assembly amended Section 305(a) of the Liquor Code5 to provide that SOs may be delivered from a licensed importer or vendor directly to a customer. Section 3 of Act 39 also states that the PLCB may not assess a handling fee on [SOs], and that “[t]he
On March 6, 2020, Pennsylvania Governor Tom Wolf (Governor Wolf) issued a Proclamation of Disaster Emergency (Proclamation) in response to the COVID-19 pandemic. See Wolf v. Scarnati, 233 A.3d 679 (Pa. 2020); see also “Process to Reopen Pennsylvania.”8 On March 16, 2020, the PLCB announced the indefinite closure of the PLCB Stores and licensee service centers effective March 17, 2020, to reduce the spread of COVID-19.9 On March 18, 2020, the PLCB, with Governor Wolf’s authorization, mandated that all retail licensees, clubs, permittees, and producers cease sales of food and alcohol until further notice.10
On April 15, 2020, MFW and A6 filed a petition for review in this Court’s original jurisdiction seeking to enforce their statutory right to direct ship SOs from licensed importers and/or vendors to customers.11 On April 16, 2020, MFW filed an emergency motion for peremptory judgment in mandamus, and special injunctive and declaratory relief (Motion), and requested an expedited hearing.12
On
Notably, this Court concluded that “[t]he intent of the General Assembly in Act 39 is clear and unambiguous.” MFW I, 231 A.3d at 54. The Court explained:
Section 305(a) of the Liquor Code and Section 1799.2-E of [T]he Fiscal Code are in pari materia. With respect to [SOs], the Act 39 amendments to Section 305(a) of the Liquor Code did the following: (a) expressly authorized licensed vendors and importers to ship [SOs] directly to their customers; (b) directed that payment for such orders be made to [the] PLCB; (c) required PLCB authorization prior to shipment; (d) prohibited [the] PLCB
from charging a handling fee for [SOs] directly shipped to customers; (e) placed liability for all [SOs] directly shipped to customers on the licensed vendor or importer until delivery to the customer; (f) required [the] PLCB to implement a procedure for processing [SOs] for direct shipment to customers by January 1, 2017; and (g) allowed [the] PLCB to continue to process [SOs] at its stores. The only effect Section 1799.2-E of [T]he Fiscal Code had on Section 305(a) of the Liquor Code was to allow [the] PLCB to implement the procedures it is required to implement under Section 305(a) [of the Liquor Code] by June 1, 2017, instead of January 1, 2017.
MFW I, 231 A.3d at 55-56 (footnote omitted). Accordingly, this Court declared: “As the Court finds the language of the statutes unambiguous, it affords no deference to [the] PLCB’s proffered construction. Seeton v. Pa. Game Comm’n, 937 A.2d 1028, 1037 (Pa. 2007) (‘While an agency’s interpretation of an ambiguous statute it is charged with enforcing is entitled to deference, courts’ deference never comes into play when the statute is clear.’).” MFW I, 231 A.3d at 57 n.12.
Specifically relative to Mandamus, this Court ruled:
[A]ll of the elements for issuance of a writ of mandamus are present. Mandamus is appropriate where, as is the case here, an agency is operating under a “mistaken view of the law that it has
discretion to act when it actually does not.” Weaver v. Pa. Bd. of Prob. [&] Parole, 688 A.2d 766, 776 (Pa. Cmwlth. 1997) (en banc) (citing C[n]ty. of Allegheny v. [Commonwealth], 490 A.2d 402 (Pa. 1985)); see also A.S. v. Pa. State Police, 143 A.3d 896 (Pa. 2016) (affirming award of mandamus based on judicial construction of ambiguous statute). Section 305(a) of the Liquor Code, properly construed, imposes a mandatory duty on [the] PLCB to accept and process [SOs] for direct shipment to customers. It further imposes a mandatory duty on [the] PLCB to implement a procedure for doing so. [The] PLCB has yet to comply with these mandatory duties, depriving licensed vendors, licensed importers, and customers of their statutory right to direct shipment of [SOs] permitted under Section 305(a) of the Liquor Code.
This Court further declared:
[T]he Court recognizes that the time established by the General Assembly for [the] PLCB to implement a direct shipment [SO] process has long passed. Nonetheless, based on the credible evidence adduced during the hearing, the Court is satisfied that implementing a new
process for the direct shipment of [SOs] authorized by Act 39 is neither as simple as Petitioners suggest nor as complicated (or expensive) as [the] PLCB would have the Court believe. [The] PLCB must be afforded a reasonable amount of time to implement thoughtfully a process, perhaps even an interim one as Petitioners’ counsel suggested during the hearing, to provide licensed vendors, licensed importers, and customers a[n] [SO] direct shipment alternative. The Court is confident that [the] PLCB has the resources and ingenuity to do so without unreasonable delay. In not setting a deadline for [the] PLCB to act, the Court’s restraint is also based in part on [the] PLCB’s recent decision to re-open [SO] pick[-]up at designated PLCB facilities, which [the] PLCB suspended when it closed all PLCB [S]tores in response to the COVID-19 pandemic and executive action by [Governor Wolf]. The absence of a direct shipment option for [SOs], coupled with the closure of all PLCB [S]tores, had an obvious impact on Petitioners - which, through their unrebutted testimony at the hearing, established that their businesses rely on the sale, purchase, and delivery of [SO] wines in Pennsylvania. The fact that Petitioners now have some way of selling, ordering, processing, and fulfilling [SOs] through [the] PLCB, though not all of what Act 39 promised, is an improvement over the recent circumstances that prompted them to initiate this lawsuit.
For these reasons, the Court will not, at this time, endeavor to set a date by which time [the] PLCB must comply with this Court’s Order.[14]
MFW I, 231 A.3d at 57-58 (footnote omitted). The Court added: “The Court will not rule at this time on Petitioners’ request for monetary damages under [Section 8303 of the Judicial Code,]
On May 27, 2020,15 the PLCB appealed to the Pennsylvania Supreme Court (30 MAP 2020) which, on March 25, 2021, issued a Per Curiam Order (without an opinion) affirming this Court’s May 1, 2020 Order.
On May 25, 2021, Petitioners filed the Damages Application. The PLCB filed an answer to the Damages Application on June 11, 2021. By September 15, 2021 Order, this Court directed that the Damages Application shall be listed for argument seriately with the PLCB’s Preliminary Objection filed in Log Cabin Property, L.P. v. Pennsylvania Liquor Control Board (Pa. Cmwlth. No. 292 M.D. 2020, filed May 27, 2022) (Log Cabin).16 This Court limited argument on the Damages Application to: (1) whether the PLCB is a “person” under Section 8303 of the Judicial Code; and (2) whether Petitioners may recover mandamus damages from the PLCB. See September 15, 2021 Order.17
Discussion
Section 8303 of the Judicial Code specifies that “[a] person who is adjudged in an action in the nature of mandamus to have failed or refused without lawful justification to perform a duty required by law shall be liable in damages to the person aggrieved by such failure or refusal.”
(1) Person Defined
The PLCB argues that, as a Commonwealth agency,18 the PLCB is not a person under Section 8303 of the Judicial Code because the definition of person in Section 1991 of the Statutory Construction Act of 1972 (SCA),
Neither Section 8303 of the Judicial Code, nor Section 102 of the Judicial Code,
Importantly, Section 1991 of the SCA’s definition of person excludes only “the Commonwealth.”
[T]he Commonwealth government and its various agencies and officers are separate entities and [] ‘the Commonwealth of Pennsylvania, itself . . . is clearly not a Commonwealth agency[.] . . .’ Bonsavage v. Borough of Warrior Run, 676 A.2d 1330, 1331 (Pa. Cmwlth. 1996) (emphasis in original)[;] [s]ee also Tork-Hiis v. Commonwealth, . . . 735 A.2d 1256 ([Pa.] 1999).
Finn v. Rendell, 990 A.2d 100, 105 (Pa. Cmwlth. 2010) (emphasis added).
The Finn Court reasoned:
The Commonwealth comprises three branches of government, each divided into many independent subparts. The essence of an action in mandamus is that a specific actor has a non-discretionary duty to perform a particular act. A request that the Commonwealth be ordered to do something begs the question which of the many actors comprising state government is to be held accountable. Since merely naming the Commonwealth is insufficient to state a claim against a Commonwealth party, [see] Tork-Hiis, it would seem self-evident that if a specific state party can be identified as having a mandatory
or ministerial duty, that party must be the named defendant, both in order to make out a cause of action in mandamus and to effectuate enforcement of any ensuing order.
Finn, 990 A.2d a 106. Applying the Finn Court’s logic here, it is reasonable to conclude that the General Assembly intended, by excluding the Commonwealth from the definition of person in Section 1991 of the SCA, that the Commonwealth itself could not be liable for mandamus damages under
The PLCB cites Commonwealth v. Runion, 662 A.2d 617 (Pa. 1995), to support its position.21 However, Runion is inapposite. First, the General Assembly legislatively superseded Runion.22 See Commonwealth v. Veon, 150 A.3d 435 (Pa. 2016). Second, the Runion Court construed a penal statute, which must be strictly construed, see Section 1928(b)(1) of the SCA,
Moreover, the context of Section 8303 of the Judicial Code, effective June 27, 1978, clearly intends that mandamus damages may be assessed against a Commonwealth agency, just as the now-repealed Mandamus Act of 1893 (Mandamus Act)23 did.
agency[’s]”25 “failure to perform legally mandated ministerial duties results from an erroneous interpretation of the law.” Stoner v. Twp. of Lower Merion, 587 A.2d 879, 885 (Pa. Cmwlth. 1991) (emphasis added).
Notably, at the time Section 8303 of the Judicial Code was enacted, Section 1991 of the SCA defined person as “a corporation, partnership, and association, as well as a natural person[,]” see Warner-CCC Inc. v. City of Altoona, 374 A.2d 987, 988 (Pa. Cmwlth. 1977), thereby exposing the Commonwealth and its agencies to liability under Section 8303 of the Judicial Code, until the General Assembly excluded the Commonwealth in 1992. There is no indication that the General Assembly intended, by amending the SCA’s definition of person in 1992, to immunize Commonwealth agencies from mandamus damages.
Finally, based on the fact that the purpose of Section 8303 of the Judicial Code is to authorize mandamus damages against government actors that fail to perform their statutorily mandated duties, Pennsylvania courts have allowed mandamus damages to be assessed against Commonwealth agencies thereunder. See Richard Allen Preparatory Charter Sch. v. Dep’t of Educ., 161 A.3d 415 (Pa. Cmwlth. 2017) (en banc), aff’d, 185 A.3d 984 (Pa. 2018); see also KIPP Phila. Charter Sch. v. Dep’t of Educ., 161 A.3d 430 (Pa. Cmwlth. 2017) (en banc), aff’d sub nom. Richard Allen Preparatory Charter Sch. v. Dep’t of Educ., 185 A.3d 984 (Pa. 2018).
Accordingly, this Court holds that, in the context presented here, the PLCB is a person subject to Section 8303 of the Judicial Code.
(2) Mandamus Damages
Petitioners also argue that they are entitled to costs and damages under Section 8303 of the Judicial Code, plus associated interest and attorneys’ fees.26 The PLCB responds that, although MFW is entitled to its taxable costs, Petitioners are not entitled to damages or related interest because the PLCB has sovereign immunity, and Petitioners are not entitled to attorneys’ fees under the circumstances of this case. In the alternative, the PLCB requests that, if this Court determines that Petitioners are entitled to damages, interest, and/or attorneys’ fees, that the Court allow discovery and/or conduct a hearing for Petitioners to prove them.
Regarding costs, Section 1726(a) of the Judicial Code provides, in relevant part:
(2) The prevailing party should recover his costs from the unsuccessful litigant except where the:
(i) Costs relate to the existence, possession or disposition of a fund and the costs should be borne by the fund.
(ii) Question involved is a public question or where the applicable law is uncertain and the purpose of the litigants is primarily to clarify the law.
(iii) Application of the rule would work substantial injustice.
(3) The imposition of actual costs or a multiple thereof may be used as a penalty for violation of general rules or rules of court.
Where, as here, there is no fund to bear Petitioners’ costs, the applicable law is certain, and application of the rule will not work a substantial injustice, Petitioners are entitled to recover allowable litigation costs from the PLCB. Accordingly, the parties agree that the PLCB owes MFW $946.26 in taxable costs pursuant to Section 1726(a)(2) of the Judicial Code.
However, the parties disagree regarding whether Petitioners are also entitled to damages, interest, and attorney’s fees.
Damages
Petitioners also seek damages from the PLCB arising from their successful mandamus action.27 See Amended Pet. at 14. The PLCB responds that sovereign immunity protects it from having to pay Petitioners damages related to their mandamus action.
Pursuant to Section 8303 of the Judicial Code, a party, including the PLCB, adjudged in a mandamus action “to have failed or refused without lawful justification to perform a duty required by law shall be liable in damages to the person aggrieved by such failure or refusal.”
In addition, this Court has explained:
Damages recoverable in mandamus are those incidental to the specific relief being sought. For example, where mandamus is issued to compel the reinstatement of a public employee in employment, the damages have regularly been confined to those arising from the absence of employment over the period, i.e., the loss of salary or net loss of income.
Stoner, 587 A.2d at 885 (citation omitted). “The damages must be clearly related to the defendant’s failure to perform a mandatory ministerial function.” Sch. Dist. of Pittsburgh v. City of Pittsburgh, 352 A.2d 223, 229 (Pa. Cmwlth. 1976). “In Stoner, this [C]ourt held that [] mandamus damages . . . do not include ‘consequential damages or damages arising in connection with transactions or potential transactions with other parties.’ Id. at 885.” Soni Props., LLC v. City of Reading (Pa. Cmwlth. No. 2559 C.D. 2009, filed May 28, 2010), slip op. at 8.28 “Black’s Law Dictionary . . . defines [consequential damages] as ‘losses that do not flow directly and immediately from an injurious act, but that result indirectly from the act.’” Safe Auto Ins. Co. v. Berlin, 991 A.2d 327, 333 n.2 (Pa. Super. 2010).
The determination of damages is a factual question to be decided by the fact-finder. The fact-finder must assess the testimony, by weighing the evidence and determining its credibility, and by accepting or rejecting the estimates of the damages given by the witnesses. Although the fact-finder may not render a verdict based on sheer conjecture or guesswork, it may use a measure of speculation in estimating damages. The fact-finder may make a just and reasonable estimate of the damage based on relevant data, and in such circumstances may act on probable, inferential, as well as direct and positive proof.
Judge Tech. Servs., Inc. v. Clancy, 813 A.2d 879, 885 (Pa. Super. 2002) (citation omitted). Discover Bank v. Booker, 259 A.3d 493, 497 (Pa. Super. 2021).
In the instant matter, Petitioners’ damages consist of lost profits, which are often consequential damages. However,
[l]ost profits . . . are not the only form of consequential damages and not all lost profits constitute consequential damages. Certain lost profits can in fact be “direct” damages. A good example is a construction contract. If a property owner wrongfully terminates a construction contract with the contractor, the direct damages that naturally arise from that wrongful termination are the “profits necessarily inherent in the contract,” i.e., the “net profit to which the contractor would have been entitled had full performance of the contract been permitted.” Similarly, if a breach foreseeably and naturally
deprives the non-breaching party of profits that would have been earned in the ordinary course of business and not under special circumstances, those lost profits may also constitute direct damages rather than consequential damages.
Glenn D. West, Sara G. Duran, Reassessing the “Consequences” of Consequential Damage Waivers in Acquisition Agreements, 63 Bus. Law. 777, 792 (2008) (emphasis added; footnotes omitted). Therefore, “[l]ost profits, though often consequential, can come in the form
The general rule of law applicable for loss of profits in both contract and tort actions allows such damages where (1) there is evidence to establish them with reasonable certainty, (2) there is evidence to show that they were the proximate consequence of the wrong; and, in the contract actions, that they were reasonably foreseeable.
Birth C[tr.] v. St. Paul Co., Inc., . . . 787 A.2d 376, 387-88 n.5 ([Pa.] 2001) (quoting Delahanty v. First P[a.] Bank, N.A., 464 A.2d 1243, 1258 ([Pa. Super.] 1983)). Co. Image Knitware, Ltd. v. Mothers Work, Inc., 909 A.2d 324, 336 (Pa. Super. 2006) (emphasis added). Accordingly, Section 8303 of the Judicial Code allows Petitioners to recover damages to the extent Petitioners can prove them.
Interest
As successful mandamus plaintiffs, Petitioners may be entitled to interest on their costs and damages at a legal rate of 6% per annum. See
Generally, “the Commonwealth is not liable to pay interest unless bound to do so by statute or by contract of its executive officers[,]” Indep. Oil & Gas Ass’n of Pa. v. Pa. Pub. Util. Comm’n, 804 A.2d 693, 704 (Pa. Cmwlth. 2002), and “interest is . . . allowed only when payment has been withheld after the duty of a party to discharge the debt has become fixed.” Id.; see also Twp. of Marple v. Weidman, 613 A.2d 94, 95 (Pa. Cmwlth. 1992) (“This Court has held that a mandamus action can include an award of interest against the Commonwealth when the Auditor General, even in good faith, delays payments.”); Temple Univ. However, this Court has also ruled that “[i]f no obligation arises under either statute or contract, we must next determine whether [the Commonwealth agency] is under an independent obligation, by virtue of the common law of this Commonwealth, to pay [] interest[.]” Braig v. Pa. State Emps.’ Ret. Bd., 682 A.2d 881, 885 (Pa. Cmwlth. 1996).
The Pennsylvania Superior Court has held:
The safest and fairest way for a court to decide questions pertaining to interest is according to a plain and simple consideration of justice and fair dealing. Since plaintiffs
are entitled to damages from defendants . . . and because it was found as a fact that defendants’ dilatory tactics caused financial harm to plaintiffs[,] we also find that plaintiffs are entitled to interest for deprivation of their money . . . .
Remic v. Berlin, 426 A.2d 153, 154 (Pa. Super. 1981) (citation omitted).
Attorneys’ Fees
MFW and A6 request that this Court grant their request for $310,821.50, which represents their combined attorneys’ fees from the moment they engaged counsel through the filing of the Damages Application.30 The PLCB retorts that Petitioners are not entitled to attorneys’ fees merely because the PLCB advanced an argument that was ultimately unsuccessful; this Court is not authorized to award attorneys’ fees pursuant to Pennsylvania Rule of Appellate Procedure (Rule) 2744; Section 2503 of the Judicial Code,
“Damages under Section 8303 [of the Judicial Code] do[] not encompass an award for reasonable counsel fees[.]” Maurice A. Nernberg & Assocs., 920 A.2d at 970 n.5. However, regarding attorneys’ fees, “Pennsylvania law embodies the American [R]ule,” Doctor’s Choice Physical Med. & Rehab. Ctr., P.C. v. Travelers Pers. Ins. Co., 128 A.3d 1183, 1189 (Pa. 2015), which “states that a litigant cannot recover counsel fees from an adverse party unless there is express statutory authorization, a clear agreement of the parties or some other established
exception.” Mosaica Acad. Charter Sch. v. Dep‘t of Educ., 813 A.2d 813, 822 (Pa. 2002). Because the parties do not agree, this Court must determine whether there is express statutory authorization or another established exception that would allow the imposition of attorneys’ fees in this case.
“In Pennsylvania, the American Rule is embodied in [Section 1726(a)(1) of the Judicial Code,]
The following participants shall be entitled to a reasonable counsel fee as part of the taxable costs of the matter:
. . . .
(7) Any participant who is awarded counsel fees as a sanction against another participant for dilatory, obdurate or vexatious conduct during the pendency of a matter.
. . . .
(9) Any participant who is awarded counsel fees because the conduct of another party in commencing the matter or otherwise was arbitrary, vexatious or in bad faith.
This Court has further interpreted that
[t]he phrase ‘or otherwise’ in [
Section 2503(9) of the Judicial Code ] refers to misconduct in the raising of defenses, and cannot be construed to refer to the [Commonwealth agency‘s] action before the commencement of the case in court. Smith.
Norris v. Commonwealth, 634 A.2d 673, 676 (Pa. Cmwlth. 1993) (emphasis added). Accordingly, “[
This Court acknowledges that
In addition to other costs allowable by general rule or Act of Assembly, an appellate court may award as further costs damages as may be just, including
(1) a reasonable counsel fee and
(2) damages for delay at the rate of 6% per annum in addition to legal interest,
if it determines that an appeal is frivolous32 or taken solely for delay or that the conduct of the participant against whom costs are to be imposed is dilatory, obdurate or vexatious. The appellate court may remand the case to the trial court to determine the amount of damages authorized by this [R]ule.
Notably, neither
According to the Pennsylvania Superior Court,
[g]enerally speaking, ’obdurate’ conduct may be defined in this context as ’stubbornly persistent in wrongdoing.’ [Webster‘s Ninth New Collegiate Dictionary] 815 (1987). Conduct is ’dilatory’ where the record demonstrates that counsel displayed a lack of diligence that delayed proceedings unnecessarily and caused additional legal work. See Gertz v. Temple Univ., 661 A.2d 13, 17 n.2 (Pa. Super. 1995). Although disposition of claims under [
Section 2503(7) of the Judicial Code ] generallyrequires an evidentiary hearing, no hearing is necessary where the facts are undisputed.
In re Est. of Burger, 852 A.2d 385, 391 (Pa. Super. 2004) (emphasis added), aff‘d, 898 A.2d 547 (Pa. 2006).
In addition, although the Judicial Code does not define “arbitrary,” the Pennsylvania Supreme Court has ruled that “[a]n opponent‘s conduct has been deemed to be ’arbitrary’ within the meaning of the statute if such conduct is based on random or convenient selection or choice rather than on reason or nature.” Thunberg v. Strause, 682 A.2d 295, 299 (Pa. 1996) (emphasis added). The term “bad faith” used in
Importantly, this Court en banc has previously ordered a Commonwealth agency - the Pennsylvania Department of Education (Department) - to pay attorneys’ fees relative to a mandamus action, on the basis that the Department‘s refusal to withhold funds or conduct a hearing as statutorily mandated, was arbitrary, dilatory, and obdurate. See Richard Allen Preparatory Charter Sch.; see also KIPP Phila. Charter Sch. Accordingly, Petitioners would be entitled to attorneys’ fees if the PLCB‘s conduct during the pendency of the litigation (or its appeal to the Pennsylvania Supreme Court) was without reasonable cause, stubbornly persistent in wrongdoing, and/or caused unnecessary delay, or its defense had no reasonable basis (i.e., no basis in law or fact).
This Court, having determined that the PLCB had a clear and unambiguous statutory duty to implement a procedure to process direct shipment SOs by June 1, 2017, see MFW I, and, given that this Court issued MFW I in May 2020, and the Pennsylvania Supreme Court affirmed that decision in March 2021, yet the PLCB has not yet fulfilled that duty, concludes that the PLCB‘s initial inaction was, at the very least, arbitrary, and its ongoing refusal to implement a procedure to process direct shipment SOs and continuing to assess handling fees is dilatory and obdurate. Accordingly, MFW and A6 are entitled to attorneys’ fees from the PLCB related to their mandamus action.
Therefore, the PLCB is liable for Petitioners’ costs. The PLCB is also liable for Petitioners’ damages to the extent Petitioners can prove them, plus associated interest on their costs and damages, and MFW and A6 are entitled to attorneys’ fees.
Conclusion
Based on the foregoing, Petitioners’ Damages Application is granted. However, the PLCB is hereby permitted to undertake discovery and/or request a hearing limited to Petitioners’ damages and interest, and MFW‘s and A6‘s attorneys’ fees.
_________________________________
ANNE E. COVEY, Judge
MFW Wine Co., LLC, A6 Wine Company, and GECC2 LLC d/b/a Bloomsday Cafe, Petitioners v. Pennsylvania Liquor Control Board, Respondent
No. 251 M.D. 2020
IN THE COMMONWEALTH COURT OF PENNSYLVANIA
May 27, 2022
ANNE E. COVEY, Judge
ORDER
AND NOW, this 27th day of May, 2022, MFW Wine Co., LLC‘s, A6 Wine Company‘s, and GECC2 LLC d/b/a Bloomsday Café‘s (collectively, Petitioners) Application for Relief Seeking Damages, Costs, Interest and Attorneys’ Fees is GRANTED.
The Pennsylvania Liquor Control Board (PLCB) has 20 days from the date of this Order to file an Application with this Court to request a hearing on Petitioners’ damages. The PLCB shall serve discovery request(s), if any, related to the issue of Petitioners’ damages 20 days from the date of this Order and all discovery shall be completed within 60 days of the date of this Order.
_________________________________
ANNE E. COVEY, Judge
MFW Wine Co., LLC, A6 Wine Company, and GECC2 LLC d/b/a Bloomsday Cafe, Petitioners v. Pennsylvania Liquor Control Board, Respondent
No. 251 M.D. 2020
IN THE COMMONWEALTH COURT OF PENNSYLVANIA
May 27, 2022
HONORABLE RENÉE COHN JUBELIRER, Judge; HONORABLE PATRICIA A. McCULLOUGH, Judge; HONORABLE ANNE E. COVEY, Judge; HONORABLE MICHAEL H. WOJCIK, Judge; HONORABLE CHRISTINE FIZZANO CANNON, Judge
BEFORE: HONORABLE RENÉE COHN JUBELIRER, Judge
HONORABLE PATRICIA A. McCULLOUGH, Judge
HONORABLE ANNE E. COVEY, Judge
HONORABLE MICHAEL H. WOJCIK, Judge
HONORABLE CHRISTINE FIZZANO CANNON, Judge
DISSENTING OPINION
BY JUDGE WOJCIK FILED: May 27, 2022
I dissent. I do not agree that the Pennsylvania Liquor Control Board (PLCB) is a “person” subject to damages under
The following words and phrases, when used in any statute finally enacted on or after September 1, 1937, unless the context clearly indicates otherwise, shall have the meanings given to them in this section:
* * *
“Person.” Includes a corporation, partnership, limited liability company, business trust, other association, government entity (other than the Commonwealth), estate, trust, foundation or natural person.
As our Supreme Court has explained, the conditional language in the definition section means that “the General Assembly contemplated that there might be instances in the [relevant statute] where a term defined in [the definition section] has a meaning that differs from the definition given it, and directed that attention be paid to what surrounds the term in order to determine whether or not the [definition section‘s] definition applies.” Pennsylvania Associated Builders and Contractors, Inc. v. Department of General Services, 932 A.2d 1271, 1279 (Pa. 2007) (emphasis added).1
Petitioners assert that
“The polestar in our quest is to ascertain and effectuate the intent of the General Assembly.” Woodford v. Insurance Department, 243 A.3d 60, 73 (Pa. 2020) (citing
(1) The occasion and necessity for the statute.
(2) The circumstances under which it was enacted.
(3) The mischief to be remedied.
(4) The object to be attained.
(5) The former law, if any, including other statutes upon the same or similar subjects.
(6) The consequences of a particular interpretation.
(7) The contemporaneous legislative history.
(8) Legislative and administrative interpretations of such statute.
In order to ascertain the General Assembly‘s intent behind
In Mayle v. Pennsylvania Department of Highways, 388 A.2d 709, 716 (Pa. 1978), our Supreme Court examined the constitutional basis for immunity and determined that the Pennsylvania Constitution
In response, “[t]he General Assembly was swift to react restoring sovereign immunity” by codifying the preexisting immunity scheme that the Supreme Court in Mayle had abolished. Dorsey, 96 A.3d at 340. The General Assembly specifically reaffirmed the historical concept of sovereign immunity by enacting
Title 42 includes
However, Title 42 also includes
In order to maintain a mandamus action against the Commonwealth, a party must name the specific Commonwealth agency, officer or employee from which relief is sought. See Finn v. Rendell, 990 A.2d 100, 105-06 (Pa. Cmwlth. 2010). In Finn, we recognized that the Commonwealth and its various agencies and officers are separate entities and that the Commonwealth of Pennsylvania, itself, is not a Commonwealth agency. Finn, 990 A.2d at 105 (citing Tork-Hiis v. Commonwealth, 735 A.2d 1256, 1257 (Pa. 1999); Bonsavage, 676 A.2d at 1331). It is the very “nature of the Commonwealth as an entity separate from its agencies and officers” that makes mandamus actions against the Commonwealth itself “a practical impossibility.” Id. We explained:
The essence of an action in mandamus is that a specific actor has a non-discretionary duty to perform a particular act. A request that the Commonwealth be ordered to do something begs the question which of the many actors comprising state government is to be held accountable. Since merely naming the Commonwealth is insufficient to state a claim against a Commonwealth party, Tork-Hiis, it would seem self-evident that if a specific state party can be identified as having a mandatory or ministerial duty, that party must be the named defendant, both in order to make out a cause of action in mandamus and to effectuate enforcement of any ensuing order.
Id. at 106 (emphasis added).
When the logic of Finn is applied in the context of
In Runion, our Supreme Court examined whether
Applying
Runion is instructive here. Because only a “person” may be liable for mandamus damages under
Although the General Assembly legislatively superseded Runion by revising
As the Majority opinion points out, Runion also involved the interpretation of “person” in a penal statute. According to the tenets of statutory construction, penal statutes must be “strictly construed.”
However, there is another fundamental tenet of statutory construction that must be applied here. Namely, “statutes in derogation of sovereignty should be construed strictly in favor of the sovereign.” Clipper Pipe & Service, Inc. v. Ohio Casualty Insurance Co., 115 A.3d 1278, 1282 (Pa. 2015); see Brimmeier, 147 A.3d at 961 (“Because immunity is the rule, we must narrowly construe any exceptions thereto.“). Because the definition of a “person” within
Although mandamus actions are permitted against the Commonwealth and its
While I join in the Majority‘s admonition of PLCB‘s conduct and recognize the inequity of Petitioners’ position, the monetary relief that Petitioners seek is simply not available against the Commonwealth. As our Supreme Court has opined:
Understandably, some immunity applications may be distasteful to those who may discern government wrongdoing, or at least unremediated collateral injury to private concerns resulting from governmental policy changes. In light of the constitutional basis for the General Assembly‘s allocation of immunity, however, the area implicates the separation of powers among the branches of government also crafted by the framers. Thus, in absence of constitutional infirmity, courts are not free to circumvent the Legislature‘s statutory immunity directives pertaining to the sovereign.
Scientific Games International, Inc. v. Department of General Services, 66 A.3d 740, 755 (Pa. 2013) (footnote omitted).
In short, because the PLCB is part of “the Commonwealth” and is not a “person,” it is not liable for damages under
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MICHAEL H. WOJCIK, Judge
President Judge Cohn Jubelirer joins in this dissent.
Notes
Log Cabin, PLCB Appl. to Stay Log Cabin’s Complaint at 5 n.2. However, at the November 17, 2021 oral argument before this Court, the PLCB admitted that it has not implemented a direct SO delivery procedure, or offered an interim SO solution. Although the PLCB’s counsel (Counsel) referenced the PLCB’s intended roll-out of a new Enterprise Resource Planning System that will include changes to the PLCB’s SO process, he did not represent what the changes would be, and he declared that the earliest the purported roll-out will occur is July 2022.Notwithstanding its disagreement with, and appeal of, the Court’s May 1, 2020 Order, the PLCB continues to take steps to implement the Court’s directive that the PLCB implement a procedure for processing direct shipments within a reasonable time period. The PLCB will continue to do so during the pendency of the MFW [I] appeal and, thus, the pendency of the requested stay.
Counsel suggested that, because the Court did not set a specific date for the PLCB’s compliance with the May 1, 2020 Order, it has not violated that Order, and whether the July 2022 roll-out is an unreasonable delay is a question for a contempt proceeding. When this Court asked why the PLCB has not simply stopped charging the SO handling fee pending the roll-out, Counsel represented that it cannot do so. When asked what would happen if licensees refused to pay the handling fees, Counsel declared that the PLCB would not release the SOs to them.
Reference in any law or document enacted or executed heretofore or hereafter to “legal rate of interest” and reference in any document to an obligation to pay a sum of money “with interest” without specification of the applicable rate shall be construed to refer to the rate of interest of six per cent per annum.