Court Opinion

ID: 9374292
Source: CourtListenerOpinion
Date Created: 2023-02-22 18:07:43.411944+00
Date Added: 2024-06-11T17:16:46.242577
License: Public Domain

[J-16-2022] [MO: Donohue, J.]
                      IN THE SUPREME COURT OF PENNSYLVANIA
                                    MIDDLE DISTRICT

 SYNTHES USA HQ, INC.,                           :   No. 11 MAP 2021
                                                 :
                       Appellee                  :   Appeal from the Order of
                                                 :   Commonwealth Court at No. 108 FR
                                                 :   2016 dated July 24, 2020, Judgment
                 v.                              :   entered January 21, 2021, reversing
                                                 :   the decision of the PA Board of
                                                 :   Finance and Revenue at No.
 COMMONWEALTH OF PENNSYLVANIA,                   :   1409195 dated January 13, 2016
                                                 :   and remanding.
                       Appellant                 :
                                                 :   ARGUED: March 10, 2022

                                   CONCURRING OPINION

CHIEF JUSTICE TODD                                      DECIDED: February 22, 2023
       I join the introduction and Part II of the majority opinion. With respect to Part I,

however, while I agree with broad aspects of the majority’s reasoning, ultimately I concur

in the result.

       The issue resolved by the majority in Part I is one of authorization, i.e., whether

the Commonwealth Attorney’s Act (“CAA”) authorizes the Office of the Attorney General

(“OAG”) to represent the Commonwealth separately from the Department of Revenue in

this appeal, which challenges the method of allocating sales of services under the Tax

Reform Code of 1971. The majority concludes that the OAG, “as an independently

elected, constitutional officer, is authorized by the CAA to represent the Commonwealth
separately from the Department on appeals from the Commonwealth Court generally,”

and can do so here. Majority Opinion at 29. I agree with this conclusion. 1

       The majority, however, does not limit its discussion to the statutory authorization

inquiry, but finds that this substantive legal issue calls for a detailed consideration of the

Rules of Professional Conduct. The majority finds that the OAG may assert a litigation

position contrary to that espoused by the government agency under the CAA, but must

manage conflicts of interest under the dual-client conduct rules, perceiving the agency

and the Commonwealth to be separate clients. Majority Opinion at 29-32. The majority

also holds that the OAG has an obligation under our professional conduct rules, not under

the CAA, to advise the Department of Revenue of its conflicting interpretation of the tax

code to enable the Department to trigger the supersession process under Section 303 of

the CAA.    Majority Opinion at 31-32.      In essence, the majority uses the Rules of

Professional Conduct to fill in purported statutory gaps in the CAA.

       Respectfully, in my view, the professional responsibilities of the OAG are outside

the scope of our grant of allocatur, were not meaningfully briefed by the parties, 2 and are

unnecessary to the disposition of this appeal. Of course, under our state charter, the

Attorney General must be a member of the Pennsylvania bar, and, thus, must comply

with our professional conduct rules. Pa. Const. art. IV, § 5. However, the Rules of

1 I further agree with the majority that the OAG has standing, as the Commonwealth is
aggrieved by the Commonwealth Court’s order remanding the case for the Board of
Finance and Revenue to issue a tax refund. Id.
2 In a brief response to a concurring opinion below, which suggested that the relationship
between the OAG and the Department of Revenue is akin to a private attorney and client,
the OAG cites Paragraph 17 of the Preamble and Scope of the Rules of Professional
Conduct, which discusses ethical obligations of government attorneys. Brief for Appellant
at 27-28. In a footnote in its brief to this Court, the Department of Revenue disputed the
OAG’s interpretation in that regard, citing additional conduct rules. Brief for Appellee at
30 n.18. Neither party, however, suggests or implies that the OAG’s ethical duties under
the conduct rules are a governing consideration in interpreting the CAA.

                             [J-16-2022] [MO: Donohue, J.] - 2
Professional Conduct do not have the effect of substantive law, and, instead, provide a

framework for the ethical practice of law and govern disciplinary proceedings. See

Pa.R.P.C. Preamble & Scope, ¶ 19 (“nothing in the Rules should be deemed to augment

any substantive legal duty of lawyers or the extra disciplinary consequences of violating

such a duty”); id. (“The Rules are designed to provide guidance to lawyers and to provide

a structure for regulating conduct through disciplinary agencies.”); id. at ¶15 (“The Rules

simply provide a framework for the ethical practice of law.”); In re Estate of Pedrick, 482

A.2d 215, 217 (Pa. 1984) (explaining that the prior Code of Professional Responsibility

does not have the force of substantive law). Because there is no issue or allegation of

professional misconduct in this tax appeal, I would leave for another day the ethical

implications of the OAG’s presentation of a litigation posture contrary to that asserted by

a government agency.

       Rather, I would resolve this appeal exclusively on the CAA and its express

authorization of the OAG to participate in matters such as this one. To facilitate a better

understanding of this statute, I observe, as does the majority, that, under the

Pennsylvania Constitution, the Attorney General is designated as the “chief law officer”

for the Commonwealth, accountable directly to the Pennsylvania voters, and that the

Attorney General “shall exercise such powers and perform such duties as may be

imposed by law.” Pa. Const. art. IV, § 4.1.

       Consistent with the sui generis role of the OAG and its constitutional origin, the

CAA provides that the OAG is authorized to represent the Executive Branch, but is also

independent therefrom. Section 204(c) of the CAA provides that “[t]he Attorney General

shall represent the Commonwealth and all Commonwealth agencies . . . in any action

brought by or against the Commonwealth or its agencies, and may intervene in any other

action . . . .” 71 P.S. § 732-204(c).

                             [J-16-2022] [MO: Donohue, J.] - 3
      Germane to this appeal, Sections 303 and 403 of the CAA address the OAG’s

representation of the Commonwealth. 3         These sections allow the Governor or

independent agency head to request that the agency’s General Counsel supersede the

Attorney General and represent the agency. 71 P.S. §§ 732-303(a), 732-403(a). If the

Attorney General refuses the request, the General Counsel can intervene as a matter of

right to represent “the Governor and his interests as Chief Executive Officer of the

Commonwealth and its Executive Department.”           Id.   However, the CAA, in such

circumstances, provides expressly that the “Attorney General shall at all times continue

to represent the Commonwealth.” Id.

3 The text of Section 303, entitled “Supersession and intervention,” provides in full as
follows:
             (a) Representation of agency by General Counsel. --
             Whenever any action is brought by or against any executive
             branch agency, the Governor or other executive branch
             official, the Governor may request in writing, setting forth his
             reasons, the Attorney General to authorize the General
             Counsel to supersede the Attorney General and represent the
             agency, the Governor or other executive branch official.

             (b) Intervention by General Counsel. -- If the Attorney General
             does not grant the request, the Governor may authorize the
             General Counsel to intervene in the litigation. Such
             intervention shall be a matter of right and when exercised,
             confer upon the General Counsel the obligation to represent
             the Governor and his interests as Chief Executive Officer of
             the Commonwealth and its Executive Department. The
             Attorney General shall at all times continue to represent the
             Commonwealth.
71 P.S. § 732-303(a). Section 403 provides functionally identical language for
independent agencies, empowering the head of an independent agency to request
supersession and intervention by the agency’s counsel in “action[s] brought by or against
any independent agency or independent agency official.” 71 P.S. § 732-403.

                           [J-16-2022] [MO: Donohue, J.] - 4
       Thus, the CAA’s supersession process ensures that both the OAG and the

Governor/agency executive have a vehicle by which to present their independent legal

positions to Pennsylvania courts in litigation commenced against any agency or executive

branch official. Our courts benefit from robust advocacy, as the free exchange of ideas

and legal theories facilitate the resolution of cases.       Here, however, the statutory

supersession process was not directly followed, as the Department of Revenue, via the

Governor, did not request the OAG to grant supersession.

       Nevertheless, the majority concludes, appropriately in my view, “a result that

conformed to the statute was achieved as the Commonwealth Court allowed the agency’s

intervention, and the OAG continued to represent the Commonwealth.” Majority Opinion

at 36. Under these circumstances, where the agency was afforded its right of intervention

by the General Counsel and the OAG continued to represent the Commonwealth

consistent with Section 303 of the CAA, in my view, we should not expand our focus to

address the OAG’s ethical duties under the Rules of Professional Conduct, which have

potential disciplinary ramifications. 4 See Pa.R.P.C. Preamble & Scope, ¶ 18 (“Failure to

comply with an obligation or prohibition imposed by a Rule is a basis for invoking the

disciplinary process.”). Although the majority certainly does not suggest or imply that the

OAG should be referred to the Disciplinary Board for the institution of a disciplinary

4 The majority’s discernment of a duty on the part of the OAG to notify the relevant
government agency of its assertion of an inconsistent litigation posture is certainly logical,
for if the agency is unaware of the OAG’s contrary litigation position, it has no reason to
initiate the supersession procedure in Section 303, rendering the entire statutory process
ineffective. My disagreement lies only in the majority’s reliance upon our professional
conduct rules to create that substantive duty when those rules do not have the effect of
substantive law.

                             [J-16-2022] [MO: Donohue, J.] - 5
proceeding, examination of the OAG’s professional responsibilities under our conduct

rules has no place in this tax appeal. 5

       Accordingly, as the OAG’s participation in this appeal was authorized by the CAA,

I concur in the result reached by the majority in Part I of its opinion.

5The parties dispute whether the OAG provided sufficient notice to the Department of
Revenue regarding the OAG’s contrary litigation posture, and the majority makes no
conclusions in this regard.

                             [J-16-2022] [MO: Donohue, J.] - 6