Case Name: Martin HELLER, Esquire and Robert F. Simone, Esquire, Appellees, v. Arthur S. FRANKSTON, Administrator of the Arbitration Panels for Health Care, Appellants
Court: Supreme Court of Pennsylvania
Jurisdiction: Pennsylvania
Decision Date: 1984-04-18
Citations: 504 Pa. 528
Docket Number: No. 58 M.D. Appeal Docket, 1983
Parties: Martin HELLER, Esquire and Robert F. Simone, Esquire, Appellees, v. Arthur S. FRANKSTON, Administrator of the Arbitration Panels for Health Care, Appellants.
Judges: Before NIX, C.J., and LARSEN, FLAHERTY, McDERMOTT, HUTCHINSON, ZAPPALA and PAPADAKOS, JJ.
Reporter: Pennsylvania State Reports
Volume: 504
Pages: 528–551

Head Matter:
475 A.2d 1291
Martin HELLER, Esquire and Robert F. Simone, Esquire, Appellees, v. Arthur S. FRANKSTON, Administrator of the Arbitration Panels for Health Care, Appellants.
Supreme Court of Pennsylvania.
Argued Jan. 24, 1984.
Decided April 18, 1984.
Gwendolyn T. Mosley, Allen C. Warshaw, Andrew S. Gordon, Deputy Atty. Gen., for appellants.
Fred Speaker, Lewis S. Kunkel, Jr., Harrisburg, for amicus curiae.
Harry Lore, Philadelphia, for appellees.
Before NIX, C.J., and LARSEN, FLAHERTY, McDERMOTT, HUTCHINSON, ZAPPALA and PAPADAKOS, JJ.

Opinion:
OPINION
NIX, Chief Justice.
Carmello Marquez, a minor, by Dionisia Marquez, his mother and guardian, and Dionisia Marquez in her own right, filed a complaint with the Administrator for Arbitration Panels for Health Care (Administrator), pursuant to the Health Care Services Malpractice Act (Act), Act of October 15, 1975, P.L. 390, as amended, 40 P.S. § 1301.101 et seq. At the time of the filing of the complaint in this matter, the arbitration panel had "original exclusive jurisdiction over a claim brought by a patient or his representative for loss or damages resulting from the furnishing of medical services which were or which should have been provided." Section 309 of the Act, 40 P.S. § 1301.309.
Before an arbitration panel was formed, the parties reached a settlement of one million dollars, one-third of the settlement to go to counsel as attorneys' fees. Because a minor was involved in the action, Martin Heller and Robert F. Simone, as counsel for the Marquez family, petitioned the court of common pleas for leave to compromise the action. The court approved the settlement and the attorneys' fees, although the attorneys' fees were in excess of the fees allowed pursuant to section 604(a) of the Act, 40 P.S. § 1301-604(a), which provided that:
(a) When a plaintiff is represented by an attorney in the prosecution of his claim the plaintiffs attorney fees from any award made from the first $100,000 may not exceed 30%, from the second $100,000 attorney fees may not exceed 25%, and attorney fees may not exceed 20% on the balance of any award.
Pursuant to section 307 of the Act, 40 P.S. § 1301.307, the parties also sought the approval of the Administrator, who initially declined to approve the settlement as proposed because the attorneys' fees were greater than those permitted by section 604(a) of the Act. The Administrator subsequently approved that portion of the fee allowed by the Act; however, because Heller and Simone raised a question as to the constitutionality of the attorneys' fees provision, the Administrator ordered that the disputed fees ($110,610.77) be placed into escrow pending final judicial disposition. The Attorney General filed a petition in the court of common pleas by which he sought to modify the court's order approving the settlement and attorneys' fees and granting distribution of the settlement fund. On October 2, 1979, the common pleas court entered an order denying the petition to modify and directed that the disputed attorneys' fees from the escrow account be remitted to appellees.
The Attorney General appealed to the Commonwealth Court, and while that appeal was pending, our Court handed down the decision in Mattos v. Thompson (Mattos), 491 Pa. 385, 421 A.2d 190 (1980). Subsequently, the Commonwealth Court held that the common pleas court did not have jurisdiction to entertain the petition seeking approval of the settlement and attorneys' fees based on its belief that only the Administrator was competent to consider and approve the settlement. Marquez v. Hahnemann Medical College and Hospital of Philadelphia, 56 Pa.Commw. 188, 424 A.2d 975 (1981). The Commonwealth Court made only passing reference to Mattos and did not address the question as to the effect of that decision on the issue then before the court. Marquez v. Hahnemann Medical College and Hospital of Philadelphia, supra, 56 Pa.Cwlth. at 190 n. 1, 424 A.2d at 976 n. 1.
Thereafter, relying on the Commonwealth Court's decision, the Administrator directed the appellees to relinquish the disputed fees. The action of the Administrator was in turn appealed to the Commonwealth Court. That court declared section 604(a) of the Act unconstitutional, finding an impermissible legislative interference with the responsibility of the judiciary. Heller v. Frankston, 76 Pa.Commw. 294, 464 A.2d 581 (1983). This appeal is from that decision.
II.
The Commonwealth Court and the parties herein have implicitly assumed the continuing validity of the Act after our decision in Mattos. They have framed the question as being whether the attorneys' fees limitation imposed by section 604(a) of the Act constitutes an impermissible interference with judicial authority to supervise the activities of attorneys. However, it is our view that the effect of the holding in Mattos was to nullify all of the arbitration procedures of the Act, including section 604(a).
At the outset it is instructive to review the purposes of the Act. The stated objectives were to make available professional liability insurance at a reasonable cost, and to establish a system through which a victim who had sustained injury or death as a result of tort or breach of contract by a health care provider could obtain a prompt adjudication of his claim and fair and reasonable compensation for the resulting losses. Section 102 of the Act, 40 P.S. § 1301.102. The heart of the scheme designed to effectuate the prompt and the fair dispute resolution was the compulsory arbitration. It is clear that section 604(a) was ancillary to and a component of that arbitration scheme. The Act's other objective of making available professional liability insurance at a reasonable cost was implemented through the establishment of the Medical Professional Liability Catastrophe Loss Fund.
We were first confronted with constitutional challenges to the arbitration system created under the Act in Parker v. Children's Hospital of Philadelphia, 483 Pa. 106, 394 A.2d 932 (1978). The focus of our attention then and now was on those provisions relating to the arbitration scheme, Articles III, IV, V, and VI. It was argued, inter alia, in Parker that the arbitration requirement constituted an impermissibly onerous burden upon the right to trial by jury accorded pursuant to Article I, Section 6 of the Pennsylvania Constitution. We upheld the constitutionality of the Act with the caveat that "deference to a coequal branch of government requires that we accord a reasonable period of . time to test the effectiveness of the legislation." Id., 483 Pa. at 121, 394 A.2d at 940.
The challenge that the arbitration process created by the Act infringed upon the right to jury was again raised in Mattos. By that time experience had demonstrated that the lengthy delays occasioned by the arbitration scheme under the Act impermissibly burdened the right of trial by jury so as to render "the right practically unavailable." Id. 491 Pa. at 390, 421 A.2d at 195.
The findings made by the Commonwealth Court indicate that the arbitration panels provided for under the Act are incapable of providing the "prompt determination and adjudication" of medical malpractice claims which was the goal of the Act. See § 102, 40 P.S. § 1301.102. Nor has the arbitration system improved within the last year. Papers filed with this Court included a statistical analysis of the health care panels up to May 31, 1980. These documents reveal that as of May 31, 1980, a total of 3,452 cases had been filed with the Administrator and that only 936 of these cases had been resolved, settled or terminated. This means that 73 per cent of the cases filed with the Administrator have not been resolved. Even worse, six of the original 48 cases filed in 1976 remain unresolved, despite the passage of four years. No extraordinary circumstances have been offered to explain this intolerable delay. Furthermore, as of May 31, 1980, 38 per cent of the claims filed in 1977, 65 per cent of the claims filed in 1978, and 85 per cent of the claims filed in 1979 remain unresolved. Such delays are unconscionable and irreparably rip the fabric of public confidence in the efficiency and effectiveness of our judicial system. Most importantly, these statistics amply demonstrate that "the legislative scheme is incapable of achieving its stated purpose."
Mattos, 491 Pa. at 395-96, 421 A.2d at 195-96 (footnote and citation omitted).
Despite our repeated statements in Mattos declaring the arbitration "system", the arbitration "procedure", the arbitration panels, and the legislative "scheme", to be ineffective and oppressive, it is still being contended that the arbitration system of the Act is viable. However, in Mattos, we expressly held:
We are compelled, therefore, to declare unconstitutional section 309 of the Act, 40 P.S. § 1301.309, giving the health care arbitration panels "original exclusive jurisdiction" over medical malpractice claims, because the delays involved in processing these claims under the prescribed procedures set up under the Act result in an oppressive delay and impermissibly infringes upon the constitutional right to a jury.
Our conclusion merely indicates the inability of this statutory scheme to provide an effective alternative dispute resolution forum in the area of medical malpractice.
Mattos, 491 Pa. at 396-97, 421 A.2d at 196 (emphasis added).
The fact that reference was made to the "original exclusive jurisdiction" of section 309 over medical malpractice claims does not mean that the unconstitutionality of section 309 refers only to its exclusivity aspect. Rather, since "the legislative scheme was incapable of, achieving its stated purpose", Parker v. Children's Hospital, supra 483 Pa. at 121, 394 A.2d at 940, Mattos inherently rendered the entire medical malpractice arbitration scheme, not only the exclusivity of jurisdiction, unconstitutional.
Nevertheless, it is argued that Mattos should be interpreted as allowing the arbitration panels to retain jurisdiction concurrent with the courts. Official Opinion of the Attorney General No. 80-2, 15 Pa.D. & C.3d 585 (1980). The fallacy underlying the attempts to read Mattos narrow ly is that that decision only declared the "exclusivity" of the jurisdiction conferred by the Act unconstitutional.
However, we emphasize that in striking down Section 309 we indicated, in the clearest possible language, that the constitutional objection resulted from the arbitration scheme. We did not expressly or implicitly limit our action to the "exclusive" aspect of the panels' jurisdiction. Our holding in Mattos rendered invalid the only legislative grant of jurisdiction to the panels. The only body competent to confer a new jurisdictional predicate for the panels would have been the legislature. This the legislature has not done.
Moreover, this argument would assume that this Court intended to provide an alternative for the scheme fashioned by the legislature. Where a legislative scheme is determined to have run afoul of constitutional mandate, it is not the role of this Court to design an alternative scheme which may pass constitutional muster. See Mayhugh v. Coon, 460 Pa. 128, 331 A.2d 452 (1975); Glancey v. Casey, 447 Pa. 77, 288 A.2d 812 (1972); Cali v. City of Philadelphia, 406 Pa. 290, 177 A.2d 824 (1962).
Under the position taken by the proponents of the ])ost-Mattos viability of the arbitration system, we would have been required to substitute concurrent jurisdiction in the place of the exclusive jurisdiction provided by the legislature. This would have been an improper exercise of judicial authority. See Mayhugh v. Coon, supra; Glancey v. Casey, supra; Cali v. City of Philadelphia, supra. Not only, as previously stated, is the fashioning of an alternative scheme an inappropriate judicial function, but also the suggested scheme would have been clearly contrary to the legislative expression of public policy. The scheme advocated by those who attempt to distort Mattos substitutes concurrent jurisdiction in the panels for exclusive jurisdiction expressly provided by the legislature. There is no doubt that the legislature intended to establish a compulsory scheme of arbitration, an integrated system in which the arbitration panels had "exclusive original jurisdiction". The exclusivity of the jurisdiction was crucial to the legislative design in that the Act could accomplish its stated purpose of prompt and fair dispute resolution only if the parties were compelled to proceed through the system.
Since Mattos, properly interpreted, did in fact strike down the arbitration process, it necessarily follows that section 604(a) no longer has vitality. While a statute may be partially valid and partially invalid, that can only occur where the provisions are distinct and not so interwoven as to be inseparable. Saulsbury v. Bethlehem Steel Co., 413 Pa. 316, 196 A.2d 664 (1964); Pennsylvania Railroad Co. v. Schwartz, 391 Pa. 619, 139 A.2d 525 (1958). The power to regulate counsel fees, was ancillary to the power to arbitrate the basic claim. Where the panel has lost the jurisdiction over the resolution of the claim itself it obviously cannot regulate counsel fees in such matters. With our decision in Mattos the exclusive original jurisdiction in these cases reverted to the court. Any argument suggesting severability of section 604(a) would be patently erroneous.
Accordingly, the Order of the Commonwealth Court vacating the Order of the Administrator is affirmed.
LARSEN, J., concurs in the result.
HUTCHINSON, J., files a dissenting opinion.
. Pa.Rule of Civil Procedure 2039(a) provides:
No action to which a minor is a party shall be compromised, settled or discontinued except after approval by the court pursuant to a petition presented by the guardian of the minor.
Additionally, the regulations adopted by the administrator pursuant to section 307 of the Act, 40 P.S. § 1301.307, provided:
Requirement of Court Approval of Settlements
Approval of a settlement involving fiduciaries, minors or incompetent parties by the Administrator or the arbitration panel shall not relieve the parties of obtaining approval by an appropriate court where such is required by the Pennsylvania Rules of Civil Procedure.
37 Pa.Code, § 171.130, adopted July 1, 1976.
. We note that the language of section 604(a), regulating counsel fees, was specifically directed to "awards" by the arbitration panels, and did not refer to "settlements". Cf. Chiesa v. Fetchko, 318 Pa.Super. 188, 464 A.2d 1293 (1983). The parties, however, have not raised this issue herein.
. Section 307 of the Act, 40 P.S. § 1301.307(b) read in pertinent part: The administrator shall have the power to consider and approve offers of settlement for fiduciaries, minors and incompetent parties at any time prior to the first meeting of the arbitration panel.
. We note that there is no question here as to the reasonableness of or the fairness of the attorneys' fees as approved by the court; the sole challenge concerned the fact that the fee exceeded the statutory limit of section 604(a) of the Act.
. The record is unclear as to whether the Attorney General was acting as counsel for the Administrator or was involved in the case pursuant to Pa.R.A.P. 521(a) which states in pertinent part:
The Attorney General may be heard on the question of the constitutionality of the statute involved without formal intervention. If the Attorney General files a brief concerning the question the Commonwealth shall thereafter be deemed to be an intervening party in the matter.
The Attorney General requested that the sum in the escrow account, plus interest, be paid to the guardian of the estate of the injured minor.
. Todays decision, as well as the decision of Mattos do not consider Articles I, II, VII, VIII, IX, and X of the Act.
. The other constitutional issues raised in Parker v. Children's Hospital of Philadelphia, 483 Pa. 106, 394 A.2d 932 (1978), include whether the Act and its procedures deny medical malpractice victims procedural due process guaranteed by the fourteenth amendment to the United States Constitution because the physician member of the panel has an impermissible financial interest in the outcome of the litigation; and whether the Act places an onerous and impermissible financial condition on the right to jury trials due to the expense of trying a complicated and expensive malpractice action in arbitration prior to having access to a jury.
. In declaring unconstitutional the arbitration system of the Act, Mattos nullified Articles III, IV, V and VI of the Act, which provide the administrative and procedural details relating to the arbitration process.
. Efforts of my colleague to redefine the meaning of Mattos, see Dissenting Opinion of Mr. Justice Hutchinson at 1297 and 1299, fail upon scrutiny. While the dissent makes a valiant attempt to retrieve some power for the Administrator for Arbitration Panels to rule upon attorney's fees, the seminal jurisdictional section 309, vital to any enforcement authority of the Administration for Arbitration Panels, no longer exists. Therefore, the state's power to regulate attorneys' • fees may not be exercised through the action of the Administrator for Arbitration Panels.