Log Cabin Property, LP v. PA LCB

IN THE COMMONWEALTH COURT OF PENNSYLVANIA
Log Cabin Property, LP, :
individually and on behalf of :
all those similarly situated, :
Petitioner :
:
v. :
:
Pennsylvania Liquor Control Board, : No. 292 M.D. 2020
Respondent : Argued: November 17, 2021
BEFORE: HONORABLE RENÉE COHN JUBELIRER, Judge1
HONORABLE PATRICIA A. McCULLOUGH, Judge
HONORABLE ANNE E. COVEY, Judge
HONORABLE MICHAEL H. WOJCIK, Judge
HONORABLE CHRISTINE FIZZANO CANNON, Judge
OPINION BY
JUDGE COVEY FILED: May 27, 2022
Before this Court is the Pennsylvania Liquor Control Board’s (PLCB)2
Preliminary Objection to the petition for review in the nature of a class action
complaint (Complaint) Log Cabin Property, LP filed, individually and on behalf of
all those similarly situated (Log Cabin) against the PLCB, in connection with this
Court’s May 1, 2020 Order in MFW Wine Co., LLC v. Pennsylvania Liquor Control
Board, 231 A.3d 50 (Pa. Cmwlth. 2020) (MFW I) (Brobson, J., single judge op.),
aff’d per curiam, 247 A.3d 1008 (Pa. 2021). In MFW I, this Court granted
peremptory judgment in mandamus and summary declaratory relief in favor of
MFW Wine Co., LLC (MFW), A6 Wine Company (A6), and GECC2 LLC d/b/a
1
This case was assigned to the opinion writer before January 7, 2022, when Judge Cohn
Jubelirer became President Judge.
2
“The PLCB regulates the distribution of beverage alcohol in Pennsylvania, operates [580
Fine W]ine and [Good S]pirits stores statewide, and licenses 20,000 alcohol producers, retailers,
and handlers.” www.media.pa.gov/pages/liquor-control-board-details.aspx?newsid=566 (last
visited May 26, 2022).
Bloomsday Café (Bloomsday Café) (collectively, MFW I Petitioners), related to the
PLCB’s failure to carry out the General Assembly’s directive to permit properly
licensed companies to sell and deliver special orders (SOs) directly to their
customers without added handling fees.3
Background
Before June 8, 2016, SO customers, like Bloomsday Café, 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 the SOs to PLCB Stores, where the
customers had to pick them up. The PLCB charged the customers a handling fee for
each bottle purchased in this process.
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 [PLCB] shall, by January 1, 2017, implement a procedure for processing
[SOs] . . . .” (Emphasis added.) Further, on July 13, 2016, the General Assembly
passed an omnibus amendment to implement the Commonwealth’s 2016-2017
budget (Section 20 of Act 85 of 20166), which added Section 1799.2-E to The Fiscal
Code,7 and therein provided that “the [PLCB] may implement a procedure for
3
SO customers are largely PLCB licensees (i.e., establishments authorized to sell alcohol).
4
Act of June 8, 2016, P.L. 273.
5
Act of April 12, 1951, P.L. 90, as amended, 47 P.S. § 3-305(a).
6
Act of July 13, 2016, P.L. 664.
7
Act of April 9, 1929, P.L. 343, as amended, added by Section 20 of the Act of July 13,
2016, P.L. 664, 72 P.S. § 1799.2-E (PLCB Procedure).
2
processing [SOs] . . . by June 1, 2017.” (Emphasis added.) The PLCB took the
position that implementing an SO processing procedure was discretionary, and the
June 1, 2017 date was merely advisory. As a result, to date, the PLCB has not
implemented an SO processing procedure, thereby preventing licensed importers
and vendors from directly shipping SOs to their customers, and the PLCB continues
to assess handling fees on all SOs.
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, in MFW I, 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,
in MFW I, MFW filed an emergency motion for peremptory judgment in mandamus,
8
See www.governor.pa.gov/process-to-reopen-pennsylvania/last updated Nov. 19, 2020
(last visited May 26, 2022). On March 19, 2020, Governor Wolf issued an Executive Order that
compelled the closure of the physical operations of all non-life sustaining Commonwealth of
Pennsylvania businesses. See id. On June 3, 2020, Governor Wolf renewed the Proclamation for
an additional 90 days. Governor Wolf renewed the Proclamation several times thereafter. See id.9
See www.media.pa.gov/pages/liquor-control-board-details.aspx?newsid=562 (last
visited May 26, 2022).
10
See www.media.pa.gov/pages/liquor-control-board-details.aspx?newsid=563 (last
visited May 26, 2022).
11
MFW and A6 explained in MFW I that they did not initiate this action before Governor
Wolf closed the PLCB Stores because it was not until their Pennsylvania revenue dropped to $0
that they had the economic motivation to lead the charge. See MFW I Application for Relief
Seeking Damages, Costs, Interest and Attorneys’ Fees at 14-15.
3
and special injunctive and declaratory relief (MFW I Motion), and requested an
expedited hearing.12
On April 22, 2020, the PLCB re-opened its SO program to allow retail
licensees with wine expanded permits (i.e., those permitted to sell wine to-go) to
pick up SOs from designated PLCB Stores beginning April 24, 2020. 13 Also on
April 22, 2020, MFW and A6 filed an amended petition for review in MFW I, adding
Bloomsday Café as a petitioner. On April 28, 2020, this Court conducted a hearing
on the MFW I Motion.
On May 1, 2020, relative to the MFW I Motion, the Court granted
summary relief in the MFW I Petitioners’ favor with respect to amended petition
Count III (Declaratory Judgment), and declared that Section 305(a) of the Liquor
Code, as amended, (1) prohibits the PLCB from charging a handling fee on SOs
delivered directly to customers, and (2) requires the PLCB to implement a procedure
to process SO direct shipments. See MFW I. With respect to amended petition Count
I (Mandamus), the Court granted summary relief in the MFW I Petitioners’ favor
and issued a writ of mandamus: (1) directing the PLCB to allow licensed vendors
and licensed importers to ship SOs directly to customers, and (2) directing the PLCB
to implement a procedure for processing SO direct shipments. The Court denied the
MFW I Motion in all other respects (Count II (Injunctive Relief)). See MFW I.
12
“Consistent with the applicable rules of appellate procedure, the Court [] treated [the MFW
I] Petitioners’ [M]otion as an application for special and summary relief. See Pa.R.A.P 123, 1532.”
MFW I, 231 A.3d at 52 n.2.
13
See www.media.pa.gov/pages/liquor-control-board-details.aspx?newsid=566 (last
visited May 26, 2022). Thereafter, the PLCB progressively expanded its access to the PLCB Stores
to retail customers and licensees. See www.media.pa.gov/pages/liquor-control-board-
details.aspx?newsid=569 (last visited May 26, 2022). On May 1, 2020, the PLCB announced that
it would resume fulfillment of retail licensees’ wine and spirits orders through the PLCB Stores
and licensee service centers. See id. By the end of June 2020, 559 PLCB stores and all 13 of the
PLCB’s licensee service centers were open with limited in-store public access. See
www.lcb.pa.gov/About-Us/News-and-Reports/Documents/PLCB%20FY%202019-
2020%20Annual%20Report.pdf (last visited May 26, 2022) at 25.
4
Specifically relative to the MFW I 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.
MFW I, 231 A.3d at 57.
This Court added:
[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 [MFW I] 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
5
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 - who, 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).
On May 6, 2020, Log Cabin filed the Complaint in the instant action,
therein alleging that it and those similarly situated have been unlawfully compelled
to pick up and pay a handling fee to the PLCB on every bottle of SO liquor or wine
14
The PLCB represented:
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.
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.
Counsel suggested that, because the Court did not set a specific date for the PLCB’s
compliance with the May 1, 2020 Order in MFW I, 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.
6
it purchased since June 1, 2017 (allowing the PLCB to collect millions of dollars in
handling fees) and, pursuant to Section 8303 of the Judicial Code, 42 Pa.C.S. § 8303,
and MFW I, they are entitled to recover damages in the form of all handling fees
paid and pick-up expenses incurred due to the PLCB’s inaction since June 1, 2017,
plus costs, prejudgment interest, and attorneys’ fees.
On May 27, 2020,15 in MFW I, the PLCB appealed to the Pennsylvania
Supreme Court (30 MAP 2020). On June 5, 2020, the PLCB filed an Application to
Stay Log Cabin’s Complaint in the instant action pending the Supreme Court’s
decision relative to MFW I. Log Cabin opposed the Application for Stay. However,
on June 30, 2020, the parties filed a Joint Application to Stay, which this Court
granted the same day.
On March 25, 2021, the Pennsylvania Supreme Court issued a Per
Curiam Order (without an opinion) affirming this Court’s May 1, 2020 Order in
MFW I. On April 15, 2021, the parties in this case filed a joint stipulation to lift the
stay. On April 28, 2021, this Court lifted the stay and issued a scheduling order.
On May 25, 2021, the MFW I Petitioners filed an Application for Relief
Seeking Damages, Costs, Interest and Attorneys’ Fees (MFW I Damages
Application), which the PLCB opposed.
On May 28, 2021, the PLCB filed the Preliminary Objection and its
supporting brief, arguing that Log Cabin failed to state a viable cause of action
because: (1) the PLCB is entitled to sovereign immunity and cannot be held liable
for damages under Section 8303 of the Judicial Code; (2) the PLCB is not a “person”
15
On May 7, 2020, the MFW I Petitioners filed an application for relief seeking leave to
amend their amended petition for review (Amendment Application) so as to allow Bloomsday
Café to plead allegations in support of a class action and state its claim for mandamus damages on
a class-wide basis. The PLCB filed an answer in opposition to the Amendment Application on
May 26, 2020. However, because the PLCB filed a notice of appeal to the Pennsylvania Supreme
Court and, after its ruling, MFW I Petitioners filed an Application for Relief Seeking Damages,
Costs, Interest and Attorneys’ Fees, this Court has not yet ruled on the Amendment Application.
7
within the meaning of Section 8303 of the Judicial Code and, thus, is not liable for
mandamus damages thereunder; and (3) mandamus damages are only available
under Section 8303 of the Judicial Code to those that bring and successfully obtain
mandamus relief, which Log Cabin has not.
On June 28, 2021, Log Cabin filed its response to the Preliminary
Objection and its opposing brief, therein arguing: (1) sovereign immunity does not
apply; (2) the PLCB is a “person” under Section 8303 of the Judicial Code; and (3)
Log Cabin need not have been a party to MFW I to recover mandamus damages. On
August 6, 2021, the PLCB filed a reply brief.
By September 15, 2021 Order, this Court directed that the PLCB’s
Preliminary Objection in this matter shall be listed for argument seriately with the
MFW I Damages Application.16 Therein, the Court limited argument on the MFW I
Damages Application to: (1) whether Petitioners may recover mandamus damages
from the PLCB; and (2) whether the PLCB is a “person” under Section 8303 of the
Judicial Code. With this Court’s permission, on October 8, 2021, Log Cabin filed a
sur-reply brief.17
Discussion
The PLCB objects to Log Cabin’s Complaint pursuant to Pennsylvania
Rule of Civil Procedure (Rule) 1028(4), on the basis that it fails to state a legally
sufficient cause of action for damages.
16
The allegations in this matter are interrelated with those raised in MFW I, and are
premised upon this Court’s preliminary ruling in that matter. On May 6, 2020, Log Cabin filed an
application to consolidate this matter with MFW I. By June 4, 2020 Order, this Court denied the
request without prejudice pending a similar application having been filed in MFW I. To date, Log
Cabin has not filed a new consolidation application in this case, nor has a similar application been
filed in MFW I.
17
On April 8, 2022, the PLCB filed an Application for Post-Submission Communication.
On April 13, 2022, Log Cabin filed an answer in opposition to the Application for Post-Submission
Communication.
8
In ruling on preliminary objections, we must accept as true
all well-pleaded material allegations in the petition for
review [in the nature of a complaint], as well as all
inferences reasonably deduced therefrom. The Court need
not accept as true conclusions of law, unwarranted
inferences from facts, argumentative allegations, or
expressions of opinion. In order to sustain preliminary
objections, it must appear with certainty that the law will
not permit recovery, and any doubt should be resolved by
a refusal to sustain them.
A preliminary objection in the nature of a demurrer admits
every well-pleaded fact in the [petition for review in the
nature of a] complaint and all inferences reasonably
deducible therefrom. It tests the legal sufficiency of the
challenged pleadings and will be sustained only in cases
where the pleader has clearly failed to state a claim for
which relief can be granted. When ruling on a demurrer,
a court must confine its analysis to the [petition for review
in the nature of a] complaint.
Torres v. Beard, 997 A.2d 1242, 1245 (Pa. Cmwlth. 2010) (emphasis added;
citations omitted). “‘[C]ourts reviewing preliminary objections may not only
consider the facts pled in the complaint, but also any documents or exhibits attached
to it.’ Allen v. Dep’t of Corr., 103 A.3d 365, 369 (Pa. Cmwlth. 2014).” Foxe v. Pa.
Dep’t of Corr., 214 A.3d 308, 311 n.1 (Pa. Cmwlth. 2019).
(1) Sovereign Immunity
The PLCB first argues in support of its demurrer that Log Cabin’s claim
is barred by sovereign immunity.18 Specifically, the PLCB asserts that there is no
18
This Court has recognized:
[U]nder Rule 1030(a) . . . , all affirmative defenses, including
immunity from suit, shall be pled in a responsive pleading under the
heading of “New Matter.” Pa.R.C[iv].P. [] 1030(a); see Madden v.
Jeffes, . . . 482 A.2d 1162, 1164 n.2 ([Pa. Cmwlth.] 1984) (noting
that [Rule] 1030 “requires that an immunity claim be pleaded as an
affirmative defense in a responsive pleading under new matter”).
However, in Stackhouse v. Pennsylvania State Police, 892 A.2d 549
specific waiver of sovereign immunity which operates to allow Log Cabin’s claim
and, although actions to restrain state officials from performing affirmative acts are
not within the rule of immunity, suits to obtain money damages are, and Log Cabin’s
tag-along claim is the latter.
Log Cabin responds that the PLCB is not entitled to sovereign
immunity in this case because: (1) the PLCB acted outside the scope of its duties;
(2) sovereign immunity does not apply to Section 8303 of the Judicial Code because
it is a long-standing form of relief expressly authorizing the assessment of damages
against a Commonwealth agency; and (3) the General Assembly has made it
abundantly clear in other contexts that sovereign immunity does not permit a state
agency to retain unlawfully collected funds.
Log Cabin seeks damages from the PLCB pursuant to Section 8303 of
the Judicial Code stemming from this Court’s ruling in MFW I that Section 305(a)
of the Liquor Code imposed a mandatory duty on the PLCB to implement a process
for licensed vendors and importers to accept and process SOs for direct shipment to
customers by June 1, 2017, that the PLCB has yet to comply with its mandatory duty,
and that its failure to do so has deprived licensed importers, licensed vendors, and
other customers of their statutory right to SO direct shipments. See MFW I, 231
A.3d at 57.
“Generally, the Commonwealth and its agencies, officials and
employees acting within the scope of their duties are immune from suits for
damages.”19 Stackhouse v. Pa. State Police, 892 A.2d 54, 58 (Pa. Cmwlth. 2006);
(Pa. Cmwlth. [2006]), . . . this [C]ourt noted that the matter may be
raised in preliminary objections when to delay a ruling on the matter
would serve no purpose.
Banfield v. Cortes, 922 A.2d 36, 43 n.5 (Pa. Cmwlth. 2007).
19
Section 102 of the Commonwealth Attorneys Act lists the PLCB among the
Commonwealth’s independent agencies. See Act of October 15, 1980, P.L. 950, as amended, 71
P.S. § 732-102.
10
see also article I, section 11 of the Pennsylvania Constitution, PA. CONST. art. I, §
11. The Pennsylvania Supreme Court declared: “The constitutionally[]grounded,
statutory doctrine of sovereign immunity obviously serves to protect government
policymaking prerogatives and the public fisc.” Sci. Games Int’l, Inc. v.
Commonwealth, 66 A.3d 740, 755 (Pa. 2013). “Thus, in [the] absence of
constitutional infirmity, courts are not free to circumvent the [l]egislature’s statutory
immunity directives pertaining to the sovereign.” Id. However, “[t]he Pennsylvania
Constitution provides that the Commonwealth and its officers and employees may
[] be sued where the General Assembly has authorized the suit.”20 Russo v.
Allegheny Cnty., 125 A.3d 113, 116 (Pa. Cmwlth. 2015), aff’d, 150 A.3d 16 (Pa.
2016).
Although the Pennsylvania Supreme Court abolished the sovereign
immunity doctrine on July 14, 1978 in Mayle v. Pennsylvania Department of
Highways, 388 A.2d 709 (Pa. 1978), “the General Assembly enacted [Section 2310
(]Act 152[),] which reinstated the doctrine of sovereign immunity in September
1978[.]” Kapil v. Ass’n of Pa. State Coll. & Univ. Faculties, 470 A.2d 482, 484 (Pa.
1983). Therein, the General Assembly specified:
Pursuant to section 11 of [a]rticle [I] of the Constitution of
Pennsylvania, it is hereby declared to be the intent of the
General Assembly that the Commonwealth, and its
officials and employees acting within the scope of their
duties, shall continue to enjoy sovereign immunity and
official immunity and remain immune from suit except as
the General Assembly shall specifically waive the
immunity. When the General Assembly specifically
waives sovereign immunity, a claim against the
Commonwealth and its officials and employees shall be
brought only in such manner and in such courts and in such
20
Because immunity remains the rule under what is commonly known as the Sovereign
Immunity Act, 42 Pa.C.S. §§ 8521-8528, exceptions thereto must be narrowly construed. See Gale
v. City of Phila., 86 A.3d 318 (Pa. Cmwlth. 2014); see also Quinones v. Dep’t of Transp., 45 A.3d
467 (Pa. Cmwlth. 2012).
11
cases as directed by the provisions of Title 42 (relating to
judiciary and judicial procedure) or 62 (relating to
procurement) unless otherwise specifically authorized by
statute.
1 Pa.C.S. § 2310. This Court explained, in Rank v. Balshy, 475 A.2d 182 (Pa.
Cmwlth. 1984), aff’d, 490 A.2d 415 (Pa. 1985), “that after our Supreme Court
abolished traditional sovereign immunity in Mayle . . . , the legislature replaced it
with statutory language, [see] 42 Pa.C.S. §§ 8521-8528, but the fact remain[ed] that
the only purpose of that statute was to restore sovereign immunity where it formerly
existed.” Id. at 185.
Moreover, since 1976 (four years before Act 152 was passed), Section
8303 of the Judicial Code has declared: “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.” 42 Pa.C.S. § 8303 (emphasis added). It does not appear
that claims brought pursuant to Section 8303 of the Judicial Code or its now-repealed
predecessor, the Mandamus Act of 1893 (Mandamus Act),21 ever required a waiver
because those actions were never barred by sovereign immunity in the first place.
This Court acknowledges that, in Chapter 85 of the Judicial Code, the
act commonly referred to as the Sovereign Immunity Act,22 the General Assembly
has waived immunity to allow “Commonwealth parties” to be sued for damages
arising from the negligent acts, 42 Pa.C.S. § 8522(a) (emphasis added), set forth in
Section 8522(b) of the Sovereign Immunity Act, see 42 Pa.C.S. § 8522(b). Log
Cabin’s claims do not fall under any of the exceptions listed in Section 8522(b) of
the Sovereign Immunity Act.
21
Act of June 8, 1893, P.L. 345, as amended, formerly 12 P.S. §§ 1911-2002, repealed by
the Act of April 28, 1978, P.L. 202.
22
The Sovereign Immunity Act became effective on December 4, 1980.
12
However, after Act 152 was passed, in Bullock v. Horn, 720 A.2d 1079(Pa. Cmwlth. 1998), wherein the Department of Corrections (DOC) similarly argued
that it enjoyed immunity because the petitioners’ action was not one of Section
8522(b) of the Sovereign Immunity Act’s exceptions, this Court held that DOC did
not enjoy immunity, reasoning:
Th[o]se immunity exceptions only apply to actions
“against Commonwealth parties, for damages arising out
of a negligent act” and are not applicable in the present
factual situation. 42 Pa.C.S. § 8522(a). Moreover,
immunity was not intended as a shield for
Commonwealth officials against alleged violations of
constitutional and/or statutory rights.
Bullock, 720 A.2d at 1081-82 (emphasis added).
Moreover, Act 152 limited sovereign immunity to “the
Commonwealth, and its officials and employees acting within the scope of their
duties[.]” 1 Pa.C.S. § 2310 (emphasis added). Similarly, a “Commonwealth party”
to whom the Sovereign Immunity Act applies is “[a] Commonwealth agency and
any employee thereof, but only with respect to an act within the scope of his office
or employment.” 42 Pa.C.S. § 8501 (emphasis added). Since the General Assembly
passed Act 152, this Court has clarified: “An agency of the Commonwealth is
entitled to complete immunity from taxation as long as it acts in accordance with the
powers granted to it. Where an agency acts outside the scope of the powers
granted[,] the immunity is lost.” Se. Pa. Transp. Auth. v. Bd. of Revision of Taxes,
777 A.2d 1234, 1237 (Pa. Cmwlth. 2001), aff’d, 833 A.2d 710 (Pa. 2003) (SEPTA)
(emphasis added). Accordingly, this Court has concluded “that sovereign immunity
does not bar either mandamus or declaratory judgment actions.”23 Brimmeier v. Pa.
23
Therefore, the petitioners in MFW I were not barred by sovereign immunity.
13
Tpk. Comm’n, 147 A.3d 954, 961 (Pa. Cmwlth. 2016), aff’d, 161 A.3d 253 (Pa.
2017).
The PLCB contends that the General Assembly declared in Section
8521(a) of the Sovereign Immunity Act: “Except as otherwise provided in []
[S]ubchapter [B (Actions Against Commonwealth Parties)], no provision of []
[T]itle [42] shall constitute a waiver of sovereign immunity for the purpose of [Act
152] (relating to sovereign immunity reaffirmed; specific waiver) or otherwise.” 42
Pa.C.S. § 8521(a). The PLCB submits that Act 152’s liability limitation prevails
over Section 8303 of the Judicial Code’s general damages authorization pursuant to
Section 1971(a) of the Statutory Construction Act of 1972 (SCA),24 1 Pa.C.S. §
1971(a). See PLCB Br. at 5-6. However, Section 8303 of the Judicial Code has not
before nor after Act 152 been subject to sovereign immunity. In addition, implied
repeals are disfavored, particularly when two statutes can be reconciled. See
Harrisburg Area Cmty. Coll. v. Pa. Hum. Rels. Comm’n, 245 A.3d 283 (Pa. Cmwlth.
2020).
The PLCB also asserts this Court’s decision is bound by the
Pennsylvania Supreme Court’s holding that “[s]uits which seek to compel
affirmative action on the part of state officials or to obtain money damages . . . are
within the rule of immunity[.]” Phila. Life Ins. Co. v. Commonwealth, 190 A.2d
111, 114 (Pa. 1963). However, that case did not involve a mandamus claim or
24
Section 1971(a) of the SCA provides:
Whenever a statute purports to be a revision of all statutes upon a
particular subject, or sets up a general or exclusive system covering
the entire subject matter of a former statute and is intended as a
substitute for such former statute, such statute shall be construed to
supply and therefore to repeal all former statutes upon the same
subject.
1 Pa.C.S. § 1971(a). Section 1971(c) of the SCA states: “In all other cases, a later statute shall not
be construed to supply or repeal an earlier statute unless the two statutes are irreconcilable.” 1
Pa.C.S. § 1971(c).
14
Section 8303 of the Judicial Code. The PLCB also offered Finn v. Rendell, 990 A.2d
100 (Pa. Cmwlth. 2010), a mandamus case, for the same conclusion. However, in
Finn, the petitioners sought to compel the Commonwealth to reimburse the county
for a district attorney’s salary the Commonwealth was under no duty to pay, which
is not the same fact pattern presented here.
Based on the foregoing, and in light of this Court’s ruling in MFW I
that the PLCB violated a clear statutory mandate, Log Cabin’s claim is not barred
by sovereign immunity.
(2) Person Defined
The PLCB also argues that, even if this Court determines that the PLCB
is not entitled to sovereign immunity, as an agency of the Commonwealth, the PLCB
is not a person under Section 8303 of the Judicial Code and, thus, Log Cabin cannot
collect mandamus damages from the PLCB. Log Cabin responds that the PLCB is
a person under Section 8303 of the Judicial Code. It maintains that the PLCB’s
argument fails to grapple with the obvious purpose of Section 8303 of the Judicial
Code, which is to authorize mandamus damages against government actors that fail
to perform their duties.
Neither Section 8303 of the Judicial Code, nor Section 102 of the
Judicial Code, 42 Pa.C.S. § 102 (definitions), define person. This Court has held
that “[w]hen a term is not defined in a statute, we resort to the definitions provided
in [S]ection 1991 of the [SCA.]” Muscarella v. Commonwealth, 87 A.3d 966, 974
(Pa. Cmwlth. 2014). Section 1991 of the SCA defines person to “[i]nclude[] a
corporation, partnership, limited liability company, business trust, other association,
government entity (other than the Commonwealth), estate, trust, foundation or
natural person.” 1 Pa.C.S. § 1991 (emphasis added). Section 1991 of the SCA
specifies that the definitions supplied therein apply “when used in any statute finally
15
enacted on or after September 1, 1937, unless the context clearly indicates
otherwise[.]” Id. (emphasis added). Therefore, the Commonwealth is not a
“person,” as that term is defined in Section 1991 of the SCA, unless the context in
which the term appears clearly indicates otherwise.
Importantly, Section 1991 of the SCA’s definition of person excludes
only “the Commonwealth.” 1 Pa.C.S. § 1991. The term Commonwealth, as used
therein could have, but does not, expressly include Commonwealth agencies, nor
does it use the broader term “Commonwealth party,” as used in Section 8501 of the
Sovereign Immunity Act. 42 Pa.C.S. § 8501. Rather, Section 1991 of the SCA
defines Commonwealth merely as “[t]he Commonwealth of Pennsylvania.” Id.
Neither the SCA nor Section 102 of the Judicial Code define “Commonwealth of
Pennsylvania.”25 Moreover, this Court has stated:
[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)[;] see also Tork-Hiis v.
Commonwealth, . . . 735 A.2d 1256 ([Pa.] 1999).
Finn, 990 A.2d at 105 (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
25
Although Section 102 of the Judicial Code’s definition of Commonwealth government
includes executive and independent “agencies of the Commonwealth[,]” 42 Pa.C.S. § 102 (see also
“Commonwealth agency” definition), if this Court is bound solely by Section 1991 of the SCA’s
definition, as the PLCB asserts, then Section 102 of the Judicial Code definitions are inapplicable.
16
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 Section 8303 of the Judicial
Code, but individual agencies could be so liable.
The PLCB cites Commonwealth v. Runion, 662 A.2d 617 (Pa. 1995),
to support its position.26 However, Runion is inapposite. First, the General
Assembly legislatively superseded Runion.27 See Commonwealth v. Veon, 150 A.3d
26The Runion Court reversed the trial court’s order that directed the defendant to pay
restitution to the Department of Public Welfare (DPW) pursuant to Section 1106 of the Crimes
Code, 18 Pa.C.S. § 1106, because only victims were entitled to restitution. At that time, Section
1106(h) of the Crimes Code defined victim as “‘[a]ny person, except an offender, who suffered
injuries to his person or property as a direct result of the crime.’ 18 Pa.C.S. § 1106(h).” Runion,
662 A.2d at 619 (emphasis added). Relying on the SCA’s definition of person, the Runion Court
held that, since DPW is “a Commonwealth entity,” id. at 621, which was excluded from the SCA’s
definition of person, the Court stated it was constrained to conclude that DPW could not be a
victim to whom restitution was due under Section 1106(h) of the Crimes Code, 18 Pa.C.S. §
1106(h). The Runion Court acknowledged that, although defining the term victim to include
government agencies would favor the restitution statute’s rehabilitative purpose, “it [wa]s for the
legislature, and not for th[e Supreme] Court, to expand the meaning of the term ‘victim’ under
[Section] 1106 [of the Crimes Code] so as to include governmental agencies . . . .” Id. at 621.
27
Effective on July 2, 1995, two weeks before the Supreme Court decided Runion, on July
18, 1995, the General Assembly amended Section 1106 of the Crimes Code to add “[a]ny other
government agency which has provided reimbursement to the victim as a result of the defendant’s
criminal conduct” to the list of entities to whom the courts may order mandatory restitution.
Section 1106(c)(1)(ii) of the Crimes Code, 18 Pa.C.S. § 1106(c)(1)(ii) (emphasis added); see also
Section 1 of the Act of May 3, 1995, P.L. 999 (Spec. Sess. No. 1). In 2009, the Pennsylvania
Supreme Court ruled, based on the legislative history of Section 1106 of the Crimes Code, the
General Assembly’s revisions, and the purpose of the restitution statute, that government agencies
that paid money on a victim’s behalf were also entitled to restitution. See Commonwealth v.
17
435 (Pa. 2016). Second, the Runion Court construed a penal statute, which must be
strictly construed, see Section 1928(b)(1) of the SCA, 1 Pa.C.S. § 1928(b)(1),
whereas Section 8303 of the Judicial Code is to be “liberally construed to effect [its]
object[] and to promote justice.” Section 1928(c) of the SCA, 1 Pa.C.S. § 1928(c).
Third, Runion did not involve the situation where, as here, a Commonwealth
agency’s conduct was contrary to and, in fact, defiant of, a statutory mandate. And,
lastly, the Runion Court concluded that “[t]he definition of ‘person’ as found in the
[SCA] was amended in 1992, in part, to exclude government entities of the
Commonwealth,” Runion, 662 A.2d at 621 n.4, when the definition amendment
actually added “government entit[ies]” as persons, while simultaneously excluding
“the Commonwealth” from the definition, as discussed supra. 1 Pa.C.S. § 1991; see
also Section 2 of the Act of December 18, 1992, P.L. 1333.
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 did. Section 16 of
the Mandamus Act28 “provide[d,] in pertinent part: ‘If a verdict is found for plaintiff
and judgment is entered thereon, or if a judgment is given for him upon a demurrer,
. . . he shall recover his damages and costs.’ The [Mandamus A]ct [wa]s
substantially reenacted at 42 Pa.C.S.[] § 8303 (1980 pamphlet).” City of Pittsburgh
v. Pa. Dep’t of Transp., 416 A.2d 461, 463 n.3 (Pa. 1980). This Court has since
ruled: “There is no doubt that mandamus damages are available under [Section 8303
Brown, 981 A.2d 893 (Pa. 2009). On October 24, 2018, the General Assembly amended the term
victim to specifically include “an affected government agency[,]” and defined “affected
government agency” to include “the Commonwealth,” 18 Pa.C.S. § 1106(h) (emphasis added); see
also Section 1 of the Act of October 24, 2018, P.L. 891, so there is no longer any doubt that the
Commonwealth and its agencies are included among the parties for whom Pennsylvania courts
may order to receive restitution. Notably, the General Assembly has not modified the definition
of person in Section 1991 of the SCA to exclude Commonwealth agencies.
28
12 P.S. § 1919 (repealed).
18
of the Judicial Code)] whenever a public agency[’s]”29 “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.
29
Although the term public agency is not specifically defined in the Judicial Code, as stated
previously, Section 102 of the Judicial Code defines government agency to include “[a]ny
Commonwealth agency or any political subdivision or municipal or other local authority, or any
officer or agency of any such political subdivision or local authority.” 42 Pa.C.S. § 102.
19
(3) Mandamus Damages
The PLCB argues that, even if it is liable for mandamus damages under
Section 8303 of the Judicial Code as a general matter, it cannot be liable to Log
Cabin, because Log Cabin was not a successful mandamus petitioner. Specifically,
the PLCB asserts that the use of the article the in the phrase the person aggrieved in
Section 8303 of the Judicial Code suggests that there is a single, identifiable
aggrieved party that the Legislature had in mind, i.e., the successful petitioner, and
where this Court has addressed mandamus damages, it has done so in the context of
a request by the original mandamus petitioner for an award of those damages.
Finally, the PLCB claims that the Mandamus Act made plain that mandamus
damages were awarded to a successful plaintiff incident to having prevailed in the
mandamus action.
Log Cabin responds that, although it did not formally style its
Complaint as one in the nature of mandamus, it clearly alleges that the PLCB has
“failed or refused to perform a duty required by law,” as required by Section 8303
of the Judicial Code. Specifically, the Complaint details the PLCB’s mandatory duty
to implement direct delivery, the harm this caused to Log Cabin and the class, and
that the MFW I Court already adjudged that the PLCB failed or refused to comply
with this duty, and those allegations meet the requisite elements of Section 8303 of
the Judicial Code. Moreover, Log Cabin asserts that it previously moved to
consolidate this action with MFW I, so as to promote judicial economy by joining
its putative class action with the one that Bloomsday Café seeks leave to assert in
MFW I. Log Cabin maintains that, because Bloomsday Café was a successful
mandamus petitioner in MFW I, Bloomsday Café’s participation as a joint class
representative with Log Cabin would moot the PLCB’s argument. Further, Log
Cabin argues that, even if the PLCB is technically correct, Log Cabin can easily
amend its Complaint to add a more formal mandamus claim, since the PLCB still
20
has not implemented a procedure for direct delivery of SOs, and continues to charge
the unlawful handling fees that are the subject of the instant action.
Pursuant to Section 1921(a) of the SCA, this Court’s objective “is to
ascertain and effectuate the intention of the General Assembly.” 1 Pa.C.S. § 1921(a).
The best indicator of the General Assembly’s intent is a statute’s plain language.
Commonwealth v. Chesapeake Energy Corp., 247 A.3d 934 (Pa. 2021). “Only if the
statute is ambiguous, and not explicit, do we resort to other means of discerning
legislative intent.” Matter of Private Sale of Prop. by Millcreek Twp. Sch. Dist., 185
A.3d 282, 291 (Pa. 2018).
However,
[i]f statutory language is “clear and free from all
ambiguity, the letter of it is not to be disregarded under the
pretext of pursuing its spirit.” [SCA] § 1921(b). Thus,
when the words of a statute have a plain and unambiguous
meaning, it is this meaning which is the paramount
indicator of legislative intent.
McKelvey v. Pa. Dep’t of Health, 255 A.3d 385, 398 (Pa. Cmwlth. 2021).
Section 8303 of the Judicial Code clearly and unambiguously intends
that, when the PLCB fails or refuses without lawful justification to perform a
statutorily mandated duty, it “shall be liable in damages to the person aggrieved by
such failure or refusal[.]” 42 Pa.C.S. § 8303. Read in the context of the
circumstances before this Court, because the PLCB has been adjudged in a
mandamus action to have refused to perform its statutory duty, it is liable for
damages “to the person aggrieved by such failure or refusal.” Id. (emphasis added).
This Court acknowledges that the General Assembly in Section 8303
of the Judicial Code’s predecessor, Section 16 of the Mandamus Act, declared: “If a
verdict is found for plaintiff and judgment is entered thereon, or if a judgment is
given for him upon a demurrer, . . . he shall recover his damages and costs.” City of
21
Pittsburgh, 416 A.2d at 463 n.3. In addition, in Section 8303 of the Judicial Code,
the General Assembly could have, but did not (as it has done in other circumstances),
refer to “any person aggrieved.” Further, Pennsylvania courts that have considered
mandamus damages have generally done so in the context of a request by the
successful mandamus petitioner for damages. That, alone, is not a sufficient basis
for this Court to conclude that a request by Log Cabin or other PLCB licensees under
the circumstances presented here are not valid. This case presents a relatively unique
situation in which the PLCB’s conduct has harmed and will continue to harm
hundreds of PLCB licensed entities.
Finally, the MFW I Court declared, and the Pennsylvania Supreme
Court affirmed the ruling, that the PLCB’s failure to comply with its duty to
implement an SO procedure has “depriv[ed (and continues to deprive)] licensed
vendors, licensed importers [(including, but not limited to, MFW and A6)], and
customers [(which naturally include Bloomsday Café and Log Cabin, and others
similarly situated)] of their statutory right to direct shipment of [SOs] permitted
under Section 305(a) of the Liquor Code.” MFW I, 231 A.3d at 57 (emphasis added).
The MFW I Court’s declaration that licensee customers, such as Log Cabin, have
been injured by the PLCB’s conduct, as an affected class member, Log Cabin could
join MFW I’s class action if and when it is permitted to do so, begs the question
whether it “appear[s] with certainty that . . . [Log Cabin has failed to state a viable
cause of action for damages against the PLCB.]” Torres, 997 A.2d at 1245(emphasis added).30 Certainly, to the extent this is a matter of first impression,
30
At the November 17, 2021 oral argument before this Court, the PLCB acknowledged
that Log Cabin and other PLCB licensees could bring a new mandamus action against the PLCB
and, after this Court reached the same conclusion it did in MFW I, as the successful mandamus
petitioners therein, they could petition this Court for damages. This Court is dismayed that the
PLCB believes the best use of Commonwealth taxpayers’ funds and this Court’s time is to litigate
serial, identical cases brought by every licensee affected by the PLCB’s continued violation of a
statutory mandate and the MFW I Court’s clear May 1, 2020 Order.
22
whether Log Cabin can claim damages from the PLCB in this case is not clear and
free from doubt.
Because the PLCB is clearly liable to licensed vendors, importers, and
licensees for provable mandamus damages under Section 8303 of the Judicial Code,
and neither that provision nor any caselaw expressly preclude Log Cabin’s claim, it
does not appear with certainty that Log Cabin cannot recover damages from the
PLCB. Accordingly, the PLCB’s Preliminary Objection must be overruled.
Conclusion
“[A]ccept[ing] as true all well-pleaded material allegations in the
[Complaint and the documents attached thereto], as well as all inferences reasonably
deduced therefrom[,]” and resolving any doubt in favor of overruling the preliminary
objection, as we must, because it does not “appear with certainty that . . . [Log Cabin
has failed to state a viable cause of action for damages against the PLCB],” Torres,
997 A.2d at 1245 (emphasis added), the PLCB’s Preliminary Objection is overruled.
_________________________________
ANNE E. COVEY, Judge
23
IN THE COMMONWEALTH COURT OF PENNSYLVANIA
Log Cabin Property, LP, :
individually and on behalf of :
all those similarly situated, :
Petitioner :
:
v. :
:
Pennsylvania Liquor Control Board, : No. 292 M.D. 2020
Respondent :
ORDER
AND NOW, this 27th day of May, 2022, the Pennsylvania Liquor
Control Board’s (PLCB) Preliminary Objection to the petition for review in the
nature of a class action complaint (Complaint) filed by Log Cabin Property, LP,
individually and on behalf of all those similarly situated, is OVERRULED. The
PLCB is directed to file an answer to the Complaint within 30 days of the date of
this Order.
The PLCB’s Application for Post-Submission Communication is
DENIED.
_________________________________
ANNE E. COVEY, Judge
IN THE COMMONWEALTH COURT OF PENNSYLVANIA
Log Cabin Property, LP, :
individually and on behalf of :
all those similarly situated, :
:
Petitioner :
:
v. : No. 292 M.D. 2020
: Argued: November 17, 2021
Pennsylvania Liquor Control :
Board, :
:
Respondent :
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. For the reasons set forth in my Dissenting Opinion filed in
MFW Wine Co., LLC v. Pennsylvania Liquor Control Board (Pa. Cmwlth., No. 251
M.D. 2020, filed May 27, 2022), I do not agree that the Pennsylvania Liquor Control
Board (PLCB) is a “person” subject to damages under Section 8303 of the Judicial
Code, 42 Pa. C.S. §8303. Therefore, unlike the Majority, I would sustain the
PLCB’s preliminary objection in the nature of demurrer on the basis that Log Cabin
Property, LP’s claim is barred by sovereign immunity.
MICHAEL H. WOJCIK, Judge
President Judge Cohn Jubelirer joins in this dissent.