Meyer v. Cmty. Coll. of Beaver County

30 A.3d 587

273 Ed. Law Rep. 837

David J. MEYER, Dallas Berry, Charles J. Brown, Jeremy Lee Fox, Martin Gorecki, Anthony J. Hollibaugh, Lisa L. Salyers, Rochell Sykes, Joseph W. Vucick, David L. Wigley, Dennis W. Woodley, Chris Mack and Tammy Muslo

v.COMMUNITY COLLEGE OF BEAVER COUNTY, Appellant.

Commonwealth Court of Pennsylvania.

Argued April 6, 2011.Decided Oct. 27, 2011.

Diego Correa, Pittsburgh, for appellant.

John P. Liekar, Jr., Pittsburgh, for appellee Dallas Berry.BEFORE: LEADBETTER, President Judge, and McGINLEY, Judge, and PELLEGRINI, Judge, and SIMPSON, Judge, and LEAVITT, Judge, and BROBSON, Judge, and McCULLOUGH, Judge.OPINION BY Judge SIMPSON.

This first of two related interlocutory appeals by permission returns to us after our Supreme Court vacated our prior decision in Meyer v. Community College of Beaver County, 965 A.2d 406 (Pa.Cmwlth.2009) ( en banc ) and remanded the case to us. In doing so, the Supreme Court determined that the part of the Judicial Code commonly known as the Political Subdivision Tort Claims Act (Tort Claims Act) ¹ does not grant immunity to a local agency from all statutory causes of action. See Meyer v. Cmty. Coll. of Beaver County, 606 Pa. 539, 2 A.3d 499 (2010) ( Meyer II ). The Court instructed us to consider: 1) whether the Community College is a “person” as defined in the Unfair Trade Practices and Consumer Protection Law (CPL) ² and therefore subject to suit under that statute; and, 2) whether the Community College is immune under the Tort Claims Act because the CPL claims raised against it sound in tort.

Generally, the Community College appeals an interlocutory order of the Court of Common Pleas of Beaver County (trial court) denying its motion for partial summary judgment. A group of former students (Plaintiffs) ³ enrolled in the Community College's police technology program (the Academy) during the 2001–02 academic year, brought a civil action after the program lost its school certification under the Municipal Police Officers Education and Training Act (Training Act), 53 Pa.C.S. §§ 2161–70, informally known as “Act 120.” In their complaints, Plaintiffs allege breach of contract and breach of warranty, and various unfair or deceptive acts as defined in the CPL.

I. Pleadings

In May 2002, before Plaintiffs completed the Academy's course of study, the Pennsylvania Municipal Police Officers' Education and Training Commission (Training Commission) suspended the Academy's Act 120 certification. The Training Commission based the suspension on numerous violations. The Training Commission officially revoked the Academy's Act 120 certification in August 2002.

Thereafter, Plaintiffs filed a complaint against the Community College that alleged as follows. In its 2000–01 ⁴ course catalog, the College expressly represented the Academy to be a Training Commission certified course of study. These express representations were made to induce, and did induce, Plaintiffs to enroll in the Academy. Plaintiffs paid tuition, attended the required courses and took examinations. Plaintiffs raised causes of action for breach of contract, breach of warranty, violations of the CPL, and violations of other statutes.

The Community College filed preliminary objections, only some of which are relevant now. In addition to issues regarding whether it is subject to liability under the CPL and whether it is immune from statutory-based claims, the Community College challenged the sufficiency of averments of fraud.

As pertinent to the current discussion, the trial court allowed CPL claims sounding in contract to proceed; however, the trial court sustained objections to all claims sounding in fraud, including CPL claims, because the averments did not establish scienter on the part of the Community College.

Plaintiffs filed an amended complaint. They repeated their previous claims for breach of contract and breach of warranty. As to claims under the CPL, they removed averments of fraudulent conduct, but they retained averments that conduct was unfair and deceptive. This pleading will be discussed below. Plaintiffs alleged substantial economic losses as a result of the Community College's violations of the CPL. They also sought treble damages and an award of costs and attorney fees under Section 9.2 of the CPL.⁵

A second round of preliminary objections was filed. Relevant now, the Community College challenged Plaintiffs' pleading of misrepresentations, asserting the averments reintroduced CPL claims sounding in fraud, contrary to the trial court's ruling on the first set of preliminary objections. Accepting Plaintiffs' arguments that the language sought to bolster breach of contract and warranty claims and not to plead a cause of action in fraud, the trial court overruled the objections.⁶

II. Partial Summary Judgment

After the close of pleadings and discovery, the Community College filed a motion for partial summary judgment. Relevant to this appeal, the Community College argued the CPL does not apply to community colleges and, as a local agency, a community college is immune from CPL claims under 42 Pa.C.S. § 8541, part of the Tort Claims Act.

Ultimately, the trial court denied the Community College's motion for partial summary judgment. The trial court rejected the assertion the CPL does not apply to community colleges. It further rejected the immunity defense on the basis that some of Plaintiffs' CPL claims sound in contract, not in tort. In denying the motion for partial summary judgment, the trial court reasoned (with emphasis added):

The party opposing a motion for summary judgment must provide an evidentiary foundation to demonstrate the existence of a genuine issue of material fact. In ruling on a motion for summary judgment, the court's function is not to decide issues of material fact, but rather to determine whether any such issues exist.

Our courts have been reluctant to recognize claims of educational malpractice in the academic environment but they have recognized that a contract exists between a student and a college. The courts have held that in general, the basic legal relationship between a student and a private university or college is contractual in nature. The catalogs, bulletins, circulars, and regulations of the institution made available to the matriculant become part of the contract. Questions of discipline, academic matters, and tuition and scholarship disputes have been addressed by courts and resolved on contract principles. At the same time, however, courts have been reluctant to apply strict contract concepts to the unique relationship that exists between students and universities or colleges.

Trial Ct. Slip Op., 5/12/08, at 5, Reproduced Record (R.R.) at 258.

In response to the denial of its motion, the Community College filed a motion to amend the order to certify for an interlocutory appeal of the following two issues: whether the Community College is a “person” as defined in Section 2(2) of the CPL, 73 P.S. § 201–2(2); and, whether the Community College is immune to prosecution because the CPL sounds in tort and the Community College is immune to tort actions under the Tort Claims Act. The trial court granted the Community College's motion. This Court allowed the appeal.

III. Meyer II

After argument, an en banc panel of this Court reversed the trial court, holding that regardless of whether the Community College was a “person” under the CPL, it was immune from claims for statutory damages under the Tort Claims Act. The Supreme Court, however, permitted a discretionary appeal. Ultimately, it reversed and remanded, with direction.

The majority opinion was authored by Mr. Justice Saylor. The majority concluded that our application of the Tort Claims Act to statutory damages was not sustainable. The majority emphasized the main policy considerations historically underlying tort law, centered on injury to a person or property. See Meyer II, 606 Pa. at 544–45, 2 A.3d at 502. This was contrasted with the central focus of contract law, the protection of bargained-for expectations. Id. The Torts Claims Act was intended to apply to the former, not the latter. Id. Consequently, the Supreme Court held that governmental immunity does not extend to all statutory causes of action, regardless of whether they sound in tort or contract. See id. at 545–46, 2 A.3d at 503.

In a lengthy note responding to the concurring opinion, the majority presumed the first order of business on remand would be for this Court to undertake the threshold determination of whether the Legislature intended for the government to be subject to private actions under Section 9.2 of the CPL. Id. at 546 n. 6, 2 A.3d at 503 n. 6. The majority highlighted the Plaintiffs' argument referencing Commonwealth Court opinions holding that the Legislature did not intend to include governmental entities within a listing of persons and entities which might technically encompass them where it did not include the governmental entity expressly. See, e.g., Huffman v. Borough of Millvale, 139 Pa.Cmwlth. 349, 591 A.2d 1137 (1991); see also Leonard v. Masterson, 70 A.D.3d 697, 896 N.Y.S.2d 358 (N.Y.App.Div.2010).

In her concurring opinion, Madame Justice Orie Melvin expressed her preference for directing this Court “to examine the pleadings on remand to determine whether the [Plaintiffs'] claims satisfy the [CPL]. If sufficient facts have been pled, the Commonwealth Court should then ascertain whether the claims sound in tort or in contract and dispose of the matter accordingly.” 606 Pa. at 549, 2 A.3d at 505. With these directives in mind, we analyze the issues.⁷

IV. Issues

A. “Person” Under CPL

1. Contentions

The Community College first asserts it is not included in the CPL's definition of a “person” and thus not subject to prosecution under Section 9.2 of the CPL. Section 2(2) of the CPL, 73 P.S. § 201–2(2), defines a “person” as follows (with emphasis added):

‘Person’ means natural persons, corporations,...