Court Opinion

ID: 4950441
Source: CourtListenerOpinion
Date Created: 2021-09-24 12:57:21.414701+00
Date Added: 2024-06-11T08:15:18.651191
License: Public Domain

SMITH, Judge,
dissenting.
Although I agree with the Majority’s conclusion that Pennsylvania Institutional Health Services, Inc. (PIHS) does have a protectable property interest, I must respectfully dissent from its holding that the language in Management Directive 215.9 is constitutional under Lyness v. State Board of Medicine, 529 Pa. 535, 605 A.2d 1204 (1992).
As recognized by the Supreme Court in Lyness and recently by this Court in Stone & Edwards Ins. Agency, Inc. v. Department of Insurance, 161 Pa.Commonwealth Ct. 177, 636 A.2d 293, aff'd, — Pa. -, 648 A.2d 304 (Nos. 003, 004 M.D. Appeal Docket 1994, filed September 30, 1994), due process rights can be violated not only where there is actual commingling, but even where there exists an appearance of nonobjectivity or that commingling of functions may take place within an agency. Although a single administrative agency may exercise both prosecutorial and adjudicative functions if “walls of division” clearly separating those two functions are constructed within the agency, Lyness, no *197such walls have been constructed in the present matter. Indeed, Management Directive 215.9 on its face presents actual commingling of functions and, at a minimum, an appearance of commingling of these functions, thereby creating a fatal defect under the Pennsylvania Constitution.
The Majority emphasizes the holding in Stone & Edwards that the focus of the Court’s examination is not the process that is purportedly authorized, but is instead the process that the party will actually receive. Paragraph 11 of the stipulation between the parties notwithstanding, the process that PIHS will actually receive regarding its possible suspension and debarment is, at best, unclear. The Management Directive fails to parcel out the roles among distinct departments or boards, sets forth nothing as to the process that PIHS will actually receive, and on its face creates at a minimum an appearance of commingling.
Moreover, the Majority ignores an earlier decision by this Court which overruled Respondents’ preliminary objections to PIHS’ petition for review in the nature of a complaint in equity and for declaratory judgment challenging implementation of the contractor suspension and debarment procedures. This Court stated as follows:
Inasmuch as the debarring official in the matter sub judice is the same agency representative who issued the notice of suspension and would sit in judgment on the debarment as well under procedures contemplated by the management directive, Petitioners have raised a valid constitutional challenge to the implementation of the management directive_
Pennsylvania Institutional Health Services, Inc. v. Department of Corrections, 158 Pa.Commonwealth Ct. 221, 228, 631 A.2d 767, 771 (1993) (PIHS I).1
The Majority apparently disregards PIHS’ argument that the procedures for suspension set forth in the Management Directive, as well as the procedures for debarment, are constitutionally infirm under Lyness. Pursuant to Management Directive 215.9, the “suspending official” both notifies the contractor that it has been suspended for an initial period of three months and makes the determination, after reviewing information submitted by the contractor, whether the suspension shall be continued, terminated, or debarment proceedings initiated. As the Directive only permits the contractor to submit information in opposition to the suspension, there is no due process hearing mandated upon suspension. Similarly, under the debarment provisions of the Directive, the agency head or designated deputy who imposes debarment provides notice to a contractor that debarment is being considered and ultimately decides whether debarment shall be imposed. In either ease, the designated official is the same individual acting in a dual capacity and deciding whether to bring the action and what the final outcome will be, in clear contravention of Lyness.
The Majority also declines to presume in advance that the Department of Corrections will adjudicate the matter in violation of PIHS’ constitutional rights. This ignores PIHS’ argument that Management Directive 215.9 is not only constitutionally infirm on its face, it clearly violates Lyness as applied in this ease. As previously noted by this Court in PIHS I, Laurence J. Reid, as the suspending official, was delegated the authority to initiate debarment proceedings and to determine debarment of those contractors doing business with the Commonwealth. The present matter stands in contrast to this Court’s decision in Stone & Edwards in which an insurance agency was provided with due process in practice, but contended that the statute on its face impermissibly commingled prosecutorial and adjudicatory functions. In that case, the Insurance Department took specific action to comply with Lyness and the Insurance Commissioner delegated all prose-cutorial functions to the deputy commissioner for enforcement, who ultimately became responsible for initiation of prosecutions and *198had no interaction with either the Commissioner’s office or the office of administrative hearings, the Department’s adjudicative arm.
In the present matter, there is no office of administrative hearings, nor are there any hearing officers or examiners within the Department of Corrections: thus no walls of division exist within the Department. A right to due process entails, inter alia, a right to know how the proceedings shall be conducted. Department of Health v. Brownsville Golden Age Nursing Home, Inc., 103 Pa.Commonwealth Ct. 449, 520 A.2d 926 (1987). Management Directive 215.9, in addition to impermissibly commingling prosecu-torial and adjudicatory functions, does not sufficiently set forth the manner in which these proceedings shall be conducted. Further, Section 7(b) of the Directive fails to provide for a hearing conducted pursuant to the Administrative Agency Law, 2 Pa.C.S. §§ 501-508, 701-704, in cases where suspension is imposed. This differs from Stone & Edwards where the Insurance Department provides such a hearing, whether license suspension or revocation is at issue.
Accordingly, I would grant PIHS’ application for entry of summary relief on Count II of the petition for review and would deny the Department’s motion for summary judgment or summary relief.

. The Supreme Court recently affirmed this Court’s entry of a preliminary mandatory injunction on August 25, 1993 enjoining Respondents from taking any further suspension or debarment action pursuant to the Management Directive pending decision on the underlying declaratory judgment action. Pennsylvania Institutional Health Services, Inc. v. Department of Corrections, 536 Pa. 544, 640 A.2d 413 (1994).