Montella v. Berkheimer Associates

FRIEDMAN, Judge,

dissenting.

I respectfully dissent. The majority opinion does not convince me that Upper More-land and Warrington Townships (townships) are necessary and indispensable parties to this action.1 Moreover, assuming, arguendo, *805that this is true, I do not believe that the majority should have affirmed the dismissal of Ernest Montella’s second amended complaint unless it was not possible to join the townships in this action. Pa.R.C.P. No. 1032(b).2

. The majority concludes that, "[i]n order to decide whether Appellant is entitled to the relief sought in his complaint, the court will necessarily have to determine the validity of the tax as applied and collected in this case.” (Maj. op. at 803.) The majority then goes on to determine *805that, based on an acknowledged agency relationship, Berkheimer and the townships are in privity with one another, so that the townships would be bound by any judgments or injunctions entered below. On that basis, the majority concludes that the trial court could not “begin to fashion a meaningful injunctive and declaratory remedy if the townships are not to be bound." (Maj. op. at 804.)

I agree that a threshold substantive issue in this case, emphasized by the superior court in transferring the appeal to this court, might necessarily be whether taxes on retirement benefits collected by Berkheimer, engaged by the townships and other political subdivisions, constitute taxes on earned income under the Local Tax Enabling Act (LTEA), Act of December 31, 1965, P.L. 1257, as amended, 53 P.S. §§ 6901-6924 and local earned income ordinances adopted thereunder. However, the resolution of this issue would at most set a legal precedent, as may occur in any case. A decision would in no way require the townships or other political subdivisions to refund taxes received, because, in addition to the statutory restraints discussed in Gorson v. Lackawanna County Board of Commissioners, 77 Pa.Cmwlth. 140, 465 A.2d 703 (1983), Appellant’s claim is that Berkheimer is independently liable based on its own willful actions, and redress is sought solely from Berk-heimer. The distinctive allegations here are that Berkheimer “knowingly” violated the LTEA and earned income ordinances, knew it was not collecting earned income taxes and, in so doing, committed unfair debt collection actions, civil rights violations in discriminating on the basis of age and was unjustly enriched. Therefore, the determinative issue is whether there is such culpability and independent liability. Assuming Appellant can prove his case in this regard, after first establishing that the taxes collected were not on earned income, it is the rights and interests of Berkheimer, not the townships, that may be impaired and prejudiced.

Further, I would agree with the majority that Appellant concedes that Berkheimer served as the townships’ agent with regard to the legal collection of taxes. However, because the claims set forth in the second amended complaint are brought against Berkheimer based on actions and omissions which exceed the authority conferred by the LTEA and various political subdivisions, Appellant does not allege an actual or apparent agency relationship between Berkheimer and the townships with regard to the collection of the alleged illegal collection of taxes; therefore, for purposes of this action, I would not find Berkheimer and the townships in privity with one another.

. Rule 1032(b) of the Pennsylvania Rules of Civil Procedure provides in pertinent part as follows:

(b) Whenever it appears by suggestion of the parties or otherwise ... that there has been a failure to join an indispensable party, the court shall order ... that the indispensable party be joined, but if that is not possible, then it shall dismiss the action.