Court Opinion

ID: 9650949
Source: CourtListenerOpinion
Date Created: 2023-08-23 15:57:14.147982+00
Date Added: 2024-06-11T18:12:27.687698
License: Public Domain

DISSENTING OPINION BY
Judge PELLEGRINI.
I respectfully dissent from the majority’s decision to uphold the General Counsel’s determination1 that John C. Balshy (Balshy) and Janice Roadcap (Roadcap) were not entitled to indemnification for costs of settlement and counsel fees because 42 Pa.C.S. § 85252 places exclusive *842jurisdiction in a “court” to make that determination.
In 2003, Steven Crawford (Crawford) filed an action under 42 U.S.C. §§ 1983, 1985 and 1986 against numerous parties, including the Commonwealth of Pennsylvania, other state officials and Balshy and Roadcap. Balshy and Roadcap both sought legal representation by the Commonwealth, which denied their request. They each then retained separate counsel. In the midst of trial, the Commonwealth reached a $1.2 million settlement with Crawford without any admission of liability.3 Balshy and Roadcap each settled their individual liability for $1,000, also without an admission of liability.
Both Balshy and Roadcap sought reimbursement of the amount they paid to settle the case as well as reimbursement of their legal fees. Balshy’s legal fees at that date totaled $107,385.85, and Roadcap’s legal fees totaled $178,156.40. Both requests were denied by the Deputy General Counsel, and both parties appealed to the General Counsel and requested an eviden-tiary hearing. At the hearing, both Balshy and Roadcap presented testimony that, if believed, would have shown that they were acting within the scope of their office or duties of their employment. The Commonwealth, through an attorney in the General Counsel’s office, presented evidence that, if believed, would have shown that Balshy and Roadcap acted in bad faith and engaged in willful misconduct outside the scope of their employment. Based on the Hearing Officer’s recommendation, the General Counsel denied both Balshy’s and Roadcap’s requests for reimbursement finding that their testimony was not credible.
The General Counsel began the portion of her adjudication entitled “Standard of Review” with three citations to Section 8525 of what is commonly known as the Sovereign Immunity Act.4 However, she has since disavowed that portion of her adjudication and now contends that Section 8525 does not apply. She now argues that Section 8525 only applies to certain torts listed in Section 8522 of the Judicial *843Code that relate to circumstances where the Commonwealth has waived its sovereign immunity. Because the action for which Balshy and Roadcap sought indemnification and counsel fees was brought under 42 U.S.C. § 1983, the General Counsel contends that it is governed only by 4 Pa.Code 39.3(b)(1),5 a regulation that gives her the authority to make the initial decision whether to offer the employee a defense and then, after a hearing, to determine whether her decision was right.6
Significantly, the General Counsel admitted at oral argument that if Section 8525 did apply, she lacked jurisdiction.7 The determinative issue then is whether the method prescribed by the General Assembly in Section 8525 giving the court jurisdiction to determine whether an employee is entitled to be indemnified for counsel fees for tort actions applies to Section 1983 constitutional torts. If so, then the General Counsel lacked jurisdiction to hear this matter, and her decision must be vacated.
I.
There is no dispute that indemnification for judgments and court costs for actions brought under 42 U.S.C. § 1983 are available to local government employees under 42 Pa.C.S. §§ 8547 and 8548 of what is commonly known as the Political Subdivision Tort Claims Act (Tort Claims Act), the analogous provisions to Section 8525, which governs commonwealth employees. It is also clear that under Sections 8547 and 8548, a court has to make the determination whether to order indemnification. In Wiehagen v. Borough of North Braddock, 527 Pa. 517, 594 A.2d 303 (1991), our Supreme Court held that a police officer was entitled to indemnification and attorney’s fees pursuant to Section 8548 for compensatory damages, attorney’s fees, costs and expenses awarded to a plaintiff in a federal civil rights action. The plaintiff brought a 42 U.S.C. § 1983 action against a police officer and the municipality based on the officer’s use of excessive force in arresting him for public intoxication. A federal jury awarded the plaintiff compensatory damages, finding that the officer, Wiehagen, used more force than necessary while acting within the scope of his duties. Officer Wiehagen brought suit seeking indemnification from the municipality under Section 8548(a) of *844the Tort Claims Act. As here, the municipality argued that it was required to indemnify an employee only when his conduct fell within one of the eight exceptions to governmental immunity set forth in 42 Pa.C.S. § 8542(b) (here, in 42 Pa.C.S. § 8522). Because Officer Wiehagen’s conduct did not fall under one of the eight exceptions, the municipality, just as the General Counsel does here, contended that it had no duty to indemnify the police officer.
In rejecting that claim, our Supreme Court stated:
We first note that Section 8548 does not limit the amount of indemnification in any manner, but rather provides that the “local agency shall indemnify the employee for the payment of any judgment on the suit.” In fact, through Section 8548(b) the Legislature has actually gone as far as to provide that the employee shall not even be liable for any expenses or legal fees incurred by the local agency during the employee’s defense. These factors alone should be sufficient to compel the conclusion that the Borough is liable to indemnify Wieh-agen for the entire judgment, which obviously fulfills the Legislature’s purpose of providing a job environment free from the risk of personal liability. However, the Borough argues that 42 Pa.C.S. § 8553(c), which limits the type of damages recoverable under the Act, does not provide for the recovery of attorney fees, costs, and expenses, and that Wieh-agen was therefore not entitled to indemnification for this portion of the judgment against him. We disagree. Section 8553(c) limits damages in actions brought pursuant to the Act, which seek damages. The case sub judice is an indemnification action, which is not an action for damages under the Act, and thus, is not subject to the damage limitations set forth in Section 8553. The original action for damages that serves as the basis for the within indemnification action was brought pursuant to 42 U.S.C. § 1983, not the Act.
In addition, 42 Pa.C.S. § 8547 provides further evidence of the Legislature’s intent that Wiehagen and others similarly situated suffer no financial loss while defending acts performed within the scope of their employment. Section 8547 actually obligates local agencies in these circumstances to defend the action on behalf of the employee or reimburse the employee for reasonable expenses incurred in defending the action, and as noted above, the employee is not liable for any expenses or attorney fees thereby incurred by the local agency pursuant to Section 8548(b). We are equally convinced that the legal assistance provided for in Section 8547 extends to federal actions in the same manner as the indemnification provided by Section 8548.
Wiehagen, 527 Pa. at 523-24, 594 A.2d at 306. (Emphasis added.) The Court then ordered that the matter be submitted to a court to make a determination as to the amount of fees and damages. See also Renk v. City of Pittsburgh, 537 Pa. 68, 641 A.2d 289 (1994); Pettit v. Namie, 931 A.2d 790, 801 (Pa.Cmwlth.2007); Kuzel v. Krause, 658 A.2d 856 (Pa.Cmwlth.1995).
While it is clear that local government employees are entitled to indemnification for damages arising out of and counsel fees incurred in defending a Section 1983 action under Sections 8547 and 8548 of the Tort Claims Act, the question is whether commonwealth employees enjoy the same protection under Section 8525 of the Sovereign Immunity Act.
II.
I recognize that there are differences between the indemnification provisions *845governing local government employees under the Tort Claims Act and commonwealth employees under the Sovereign Immunity Act. The most pertinent difference is that Section 8548 of the Tort Claims Act does not limit the type of action for which a local government employee is entitled to indemnification, only stating that it applies “[w]hen an action is brought against an employee of a local agency for damages on account of an injury to a person or property.” Section 8525 of the Sovereign Immunity Act is different in that it states that “[wjhen an action is brought under this subchapter [Sovereign Immunity Act] against an employee of the Commonwealth government,” the employee is entitled to indemnification. The General Counsel argues that this difference in language takes representation and indemnification for Section 1988 actions outside Section 8525 of the Sovereign Immunity Act because a federal action was obviously not brought under the Sovereign Immunity Act.
Before getting to the General Counsel’s contention, it may first be useful to explain what a Section 1983 action is. Section 1983 provides, in relevant part:
Every person who, under color of any statute, ordinance, regulation, custom, or usage, of any State ... subjects, or causes to be subjected, any citizen of the United States ... to the deprivation of any rights, privileges, or immunities secured by the Constitution and laws, shall be liable to the party injured in an action at law, suit in equity, or other proper proceeding for redress ... 42 U.S.C. § 1983.
However, a Section 1983 action does not create any substantive rights, but rather serves merely as a “vehicle or ... ‘device’ by which a citizen is able to challenge conduct by a state official whom he claims has deprived or will deprive him of his civil rights.” Harry Blackmun, Section 1983 and Federal Protection of Civil Rights— Will the Statute Remain Alive or Fade Away? 60 N.Y.U.L.Rev. 1, 1 (1985); Balent v. City of Wilkes-Barre, 542 Pa. 555, 564-65, 669 A.2d 309, 314 (1995) (quoting Urbanic v. Rosenfeld, 150 Pa.Cmwlth. 468, 616 A.2d 46 (1992)). In other words, it is just a form of action.
Section 1983, though, is to be interpreted “against the background of tort liability that makes a man responsible for the natural consequences of his action” to create a “constitutional tort without a showing of specific intent.” Monroe v. Pape, 365 U.S. 167, 187, 81 S.Ct. 473, 5 L.Ed.2d 492 (1961). Common law or statutory torts that would not have been actionable under the Tort Claims Act or Sovereign Immunity Act become converted into constitutional torts through Section 1983. For example, the torts of assault, battery or wrongful death, which are not maintainable under the Tort Claims Act or Sovereign Immunity Act, can become maintainable under those Acts through Section 1983 as a denial of due process by summary infliction of punishment. Similarly, negligently failing to provide medical care to a person in custody becomes actionable through Section 1983 under the Eighth Amendment’s cruel and unusable punishment provision. In short, Section 1983, as a constitutional tort, overlaps the conduct that is covered by the Sovereign Immunity Act.
Going back to the General Counsel’s contention that Section 8525 of the Sovereign Immunity Act does not provide indemnification because a Section 1983 lawsuit is not “an action brought under [the Sovereign Immunity Act]”, that initial clause is problematic because it cannot mean what it says. The Sovereign Immunity Act does not provide for a cause of action, but instead only provides an affirmative defense to those actions that do not *846fall within one of the exceptions to immunity. In other words, the phrase cannot be taken literally because there is no such thing as a cause of action for sovereign immunity. Rather, all actions seeking recovery against a governmental party are brought in the form of a civil action or some available statutory form of action, and then sovereign immunity is pled as a defense. Therefore, if we were to interpret this provision as the General Counsel suggests, it would mean that no employee’s damages or counsel fees could ever be indemnified under Section 8525 because no actions are ever brought under the Sovereign Immunity Act.
It could be argued that an action is “brought” under the Sovereign Immunity Act when the action falls under one of the exceptions to immunity. However, besides already being rejected in Wiehagen, that position would lead to situation where sovereign immunity is pled and the action is dismissed that a commonwealth employee could not recover counsel fees. For example, if a state trooper is sued for negligence for shooting an innocent bystander when the trooper intended to shoot an actor engaged in a violent felony, the action would not have been “brought” under the Sovereign Immunity Act because that conduct does not fall within any of the exceptions to immunity. No one would argue that if the Attorney General initially refused to defend an action based on those facts brought against the state trooper, the procedure set forth in Section 8525 would not be applicable to determine whether an employee is entitled to counsel fees if that action was dismissed.
Similarly, just because the form of the action is under Section 1983 does not mean that Section 8525 does not apply to determine whether damages and counsel fees should be indemnified for conduct that would otherwise fall within one of the exceptions or subject to the defense of sovereign immunity. For example, the same conduct described above involving the shooting of a bystander could give rise to the bringing of a constitutional tort under Section 1983, perhaps under a deliberate indifference standard, subjecting the state trooper to personal liability. The purpose of Section 8525 is to provide commonwealth employees a job environment free from the risk of personal liability and to provide that a court make the determination whether indemnification should be permitted, not within the “sole discretion” of the General Counsel or the Attorney General whose interests may be adverse.
Because Section 1983 overlaps conduct covered by the Sovereign Immunity Act, I would hold that the procedure set forth in Section 8525 of the Sovereign Immunity Act for indemnification applies to all actions where a commonwealth employee is subject to personal monetary liability when acting within the scope of his or her office, including constitutional torts brought under Section 1983. Because that procedure mandates that a “court” determines whether a commonwealth employee should be reimbursed for counsel fees and damages, I would vacate the General Counsel’s order because she lacked subject matter jurisdiction to make that determination. Accordingly, I respectfully dissent.

. Although none of the parties raised the issue of subject matter jurisdiction until ordered to do so by this Court, the issue of subject matter jurisdiction is never waived, and a court may raise it sua sponte. Borough of Jenkintown v. Hall, 930 A.2d 618, 626 n. 7 (Pa.Cmwlth.2007); West Mifflin Area School District v. Board of Property Assessment Appeals, 844 A.2d 602, 605 n. 3 (Pa.Cmwlth.2004). After a panel heard this matter, we ordered supplemental briefs and it was argued en banc.

. 42 Pa.C.S. § 8525 provides:
When an action is brought under this sub-chapter against an employee of the Commonwealth government, and it is alleged that the act of the employee which gave rise to the claim was within the scope of the office or duties of the employee, the Commonwealth through the Attorney General shall defend the action, unless the Attorney General determines that the act did not occur within the scope of the office or duties of the employee. In the latter case, if it is subsequently determined that the act occurred within the scope of the office or *842duties of the employee, the Commonwealth shall reimburse the employee for the expense of his legal defense in such amounts as shall be determined to be reasonable by the court. If an action is brought against a Commonwealth government employee for damages on account of injury to a person or property and it is not alleged that the act of the employee which gave rise to the claim was within the scope of his office or duties, and he successfully defends the action on the basis that the act was within the scope of his office or duties, and he has given prior notice to the Attorney General and the Attorney General has refused to defend the action, he shall likewise be entitled to the reasonable expenses of the defense.

. Because the Commonwealth has Eleventh Amendment immunity and is not subject to money damages, the only possible reason for it to settle an action brought against it is if some state actor was guilty of an independent negligence that the Commonwealth agreed to defend and indemnify. Otherwise, the Commonwealth could have been dismissed from the case as a matter of law leaving the state actors to their own devices. Thus, by the very act of settling with Crawford, the Commonwealth implicitly admitted that other state actors were entitled to a defense and indemnification by the Commonwealth; in other words, that their actions had been within the scope of their office or duties as Commonwealth employees. Instead, the Commonwealth agreed to pay the vast majority of the settlement, leaving Balshy and Roadcap liable for a nearly de minimis amount of damages when compared to the sum total of the settlement. The General Counsel argues that because the Joint State Government Report on Sovereign Immunity states that the Commonwealth did not intend to waive immunity meant that it did not intend to waive Eleventh Amendment Immunity.

. 42 Pa.C.S. §§ 8521-8527.

. Section 39.3(b)(1) provides:
If the General Counsel or the General Counsel’s designee determines that the defendant's conduct was a bad faith exercise of his authority, malicious or outside the scope of his employment, the General Counsel, in his sole discretion, will determine whether the Commonwealth will undertake the defense of the defendant. The Commonwealth will not indemnify the defendant for a judgment against him, and will notify the defendant that he may be subject to personal liability and should engage his own attorney.
(Emphasis added.)

. No argument has been made that there was an impermissible comingling of functions. See Lyness v. State Board of Medicine, 529 Pa. 535, 605 A.2d 1204 (1992).

.An analysis of Section 8525 leads inescapably to the conclusion that it vests original jurisdiction in a "court.” Section 8525 provides for mandatory reimbursement of legal fees and for costs for any Commonwealth employee whose action was within the scope of the office or duties of the employee, a very broad standard. It also provides that the defense reimbursement should be determined by a "court.”
While Section 8525 is silent as to reimbursement for the employee’s damages, presumably reimbursement for damages Dows automatically from the reimbursement for legal fees through basic agency law because a determination to reimburse legal fees is an admission by the Commonwealth that the employee’s actions were within the scope of his office or duties of the employee.