Opinion
Argued September 8, 1976
October 15, 1976.
Parties — Jurisdiction of the Commonwealth Court of Pennsylvania — Appellate Court Jurisdiction Act of 1970, Act 1970, July 31, P.L. 673 — Indispensable party — Constitutional question — Sovereign immunity — Equity — Benefit to Commonwealth.
1. The Appellate Court Jurisdiction Act of 1970, Act 1970, July 31, P.L. 673, gives exclusive jurisdiction to the Commonwealth Court of Pennsylvania in cases where the Commonwealth is an original party defendant or an indispensable party defendant and, where no relief is sought by the plaintiff against the Commonwealth, the Commonwealth Court of Pennsylvania has no jurisdiction unless the Commonwealth is an indispensable party to the action. [565]
2. In determining whether the Commonwealth Court of Pennsylvania is an indispensable party to an action, constitutional issues as well as procedural rules and decisional law must be considered. [565]
3. The sovereign immunity of the Commonwealth of Pennsylvania extends to cases in equity. [565]
4. The Commonwealth of Pennsylvania is not an indispensable party to an action merely because it may benefit from the action but is such only where the matter cannot conceivably be concluded with meaningful relief without the direct involvement of the Commonwealth. [565-6]
Argued September 8, 1976, before President Judge BOWMAN and Judges CRUMLISH, JR., WILKINSON, JR., MENCER, ROGERS and BLATT. Judge KRAMER did not participate.
Original jurisdiction, No. 1316 C.D. 1973, in the Commonwealth Court of Pennsylvania in case of Betty McDonough v. Commonwealth of Pennsylvania, Gulf Insurance Company and Reserve Insurance Company. Complaint in equity by taxpayer seeking rescission of insurance contracts and restitution of premiums paid by the Commonwealth. Defendant insurers filed preliminary objections. Held: Preliminary objections sustained and cause transferred to the Court of Common Pleas of Montgomery County.
Harry R. Nixon, with him Schneider, Nixon John, for plaintiff.
John J. Walash, Jr., with him Joseph G. Manta, and LaBrum Doak, for defendant, Gulf Insurance Co.
F. Murray Bryan, with him Clyde W. McIntyre, and McNees, Wallace Nurick, for defendant, Reserve Insurance Company.
Joseph W. McGuire, Deputy Attorney General, with him J. Justin Blewitt, Jr., Deputy Attorney General, and Robert P. Kane, Attorney General, for defendant, Commonwealth.
Plaintiff filed a taxpayers' suit against the Commonwealth of Pennsylvania (Commonwealth) and two named insurance carriers. The complaint alleges that the Commonwealth has paid substantial sums to the defendant carriers to insure state employes against liability for injuries and damages caused by them in the course of their employment. Plaintiff argues that because Commonwealth employes are immune from liability for ordinary negligence the risk of liability insured against is nonexistent. Consequently, it is alleged that the defendant carriers are unjustly enriched by the receipt of premiums without consideration. An accounting of the premiums is sought together with the refund of the premiums to the Commonwealth. No relief is sought against the Commonwealth. Preliminary objections challenging the jurisdiction of this Court have been raised by the defendant insurance carriers.
The Court's jurisdiction in this case is dependent on the Commonwealth remaining a party to the action. Section 401 of the Appellate Court Jurisdiction Act of 1970, Act of July 31, 1970, P.L. 673, as amended, 17 Pa.C.S.A. § 211.401, has been interpreted as conferring exclusive original jurisdiction to the Commonwealth Court "where the Commonwealth is an original party defendant or is determined to be an indispensable party defendant." Keitt v. Ross, 17 Pa. Commw. 183, 189, 331 A.2d 582, 584 (1975). Since no relief is sought against the Commonwealth, this Court's jurisdiction depends upon whether or not the Commonwealth is an indispensable party to the plaintiff's equity action. See Comerford v. Factoryville Borough Council, 16 Pa. Commw. 261, 263, 328 A.2d 221, 222 (1974).
Whether the Commonwealth is an indispensable party to this action cannot be determined by "simply considering rules of civil procedure and decisional law as adopted and developed within traditional concepts of parties at law." Ross v. Keitt, 10 Pa. Commw. 375, 380, 308 A.2d 906, 908 (1973). Difficult constitutional issues enter into the determination, such as sovereign immunity. See Pa. Const. art. I, § 11; Brown v. Commonwealth, 453 Pa. 566, 305 A.2d 868 (1973). This immunity has been extended to cases in equity. Philadelphia Life Insurance Co. v. Commonwealth, 410 Pa. 571, 190 A.2d 111 (1963).
Plaintiff argues that the Commonwealth is an indispensable party because the Commonwealth would be the beneficiary if the action is successful. President Judge BOWMAN discarded that position by stating:
"[T]he Commonwealth of Pennsylvania — as a sovereign state — should not be declared to be an indispensable party to an action or proceeding . . . unless such action cannot conceivably be concluded with meaningful relief without the sovereign state itself becoming directly involved." Ross v. Keitt, 10 Pa. Commw. 375, 381, 308 A.2d 906, 909 (1973).
Meaningful relief can be granted in this case without the direct involvement of the Commonwealth, so the Commonwealth may not be joined as an indispensable party. Because the Commonwealth has been improperly joined, the preliminary objections of the defendant insurance carriers challenging the jurisdiction of the Court must be sustained and the matter transferred to a court of proper jurisdiction.
Accordingly, we will enter the following
ORDER
NOW, October 15, 1976, the preliminary objections of the defendant insurance carriers challenging the jurisdiction of this Court are sustained. It is hereby ordered that the Commonwealth be stricken from the caption and the matter transferred to the Court of Common Pleas of Montgomery County 30 days from the date hereof or to such other County as the parties may agree to prior to that date. The Chief Clerk is directed to transfer the record in this case to the Prothonotary of the Court of Common Pleas of Montgomery County or to such other County agreed upon, together with a certified copy of the docket entries of this Court and of this Opinion.