Marx v. Lake Lehman School District

Dissenting Opinion by

Judge FRIEDMAN.

I respectfully dissent. I do not agree that Donald Marx (Marx) has standing to seek a temporary restraining order and preliminary injunction against the Lake Lehman School District (School District) to enjoin the School District’s public bid award to Main Electric Supply Contracting, Inc. (Main Electric) for electrical contracting work.

I. Traditional Standing

The purpose of the requirement of standing is to protect against improper plaintiffs. Application of Biester, 487 Pa. 438, 409 A.2d 848 (1979). To meet the standing requirement, a plaintiff must allege and prove an interest in the outcome of the suit which surpasses the common interest of all citizens in procuring obedience to the law. Id. To surpass the common interest, the plaintiffs interest must be substantial, direct and immediate.1 Id. (citing Wm. Penn Parking Garage, Inc. v. City of Pittsburgh, 464 Pa. 168, 346 A.2d 269 (1975)).

Here, Marx testified that he is a taxpayer who resides in the School District and a heating and air conditioning contractor. (R.R. at 61a.) When asked why he agreed *1250to allow this lawsuit to be brought in his name, Marx replied, “Well, I bid school work and ah the other work and I like to see that it’s fair, that everybody bid apples for apples and bid according to specifications.” (R.R. at 61a.) On cross-examination, Marx testified as follows:

Q. Do you have any interest in the outcome of this other than [as] a taxpayer like anyone else in [the School District]?
A. No, sir.

(R.R. at 68a.) Thus, Marx admitted that he does not have a substantial, direct and immediate interest which surpasses the common interest of all citizens.

Of course, as a taxpayer, Marx’s interest in the outcome of this litigation is not necessarily substantial, direct and immediate. Our supreme court has stated that an interest in preventing a waste of tax revenue “is not immediate because the detriment to the taxpayer is too remote since he is not directly or specially affected by the loss.” Biester, 487 Pa. at 444, 409 A.2d at 851. In similar fashion, this court has stated that a taxpayer’s interest in “protecting the integrity of the competitive bidding process ... is too remote to grant [the taxpayer] standing [and] ... the threat of future noncompliance with bid specifications cannot be a basis to grant standing [to the taxpayer].” Boady v. Philadelphia Municipal Authority, 699 A.2d 1358, 1361 n. 1 (Pa.Cmwlth.1997).

II. Narrow Exception

There is a narrow exception to the requirement that a taxpayer have a substantial, direct and immediate interest in the outcome of the litigation. Biester; Rainey v. Borough of Derry, 163 Pa.Cmwlth. 606, 641 A.2d 698 (1994). A taxpayer without a substantial, direct and immediate interest may have standing if the taxpayer can demonstrate that: (1) the governmental action otherwise would go unchallenged; (2) those directly and immediately affected by the complained of expenditures are beneficially affected and not inclined to challenge the action; (3) judicial relief is appropriate; (4) redress through other channels is unavailable; and (5) no other persons are better situated to assert the claim.2 Id.

Here, Marx’s testimony does not address any of these elements. Thus, I cannot conclude that Marx met his burden of proving that he falls within this narrow exception. Inexplicably, the majority does not address the requirements for taxpayer standing set forth in Biester. The majority simply concludes that Marx has standing as a taxpayer. (Majority op. at 1245.)

III. Sufficient Knowledge

In Rainey, having concluded that the taxpayers met the Biester requirements, this court considered whether a taxpayer’s interest is negated by the lack of a thorough comprehension or knowledge of the complaint. This court stated that taxpayers need not understand the legal basis for the complaint. Rainey. However, this court did require that taxpayers have “a sufficient knowledge of the factual circumstances surrounding the bidding process, giving rise in them to a specific interest in *1251the outcome of that process.” Rainey, 641 A.2d at 701 (emphasis added).

Here, Marx testified that the bidding process was improper because Main Electric failed to file a proper bid bond. (R.R. at 64a.) However, when Marx was shown a copy of Main Electric’s bid bond, Marx testified, “I think he was talking about the performance bond.” (R.R. at 64a) (emphasis added). Marx was referring to Joseph Cavanaugh, a disappointed bidder who asked Marx to challenge the bid award and who hired and paid for Marx’s attorney. (R.R. at 63a-64a.) Marx never discussed this case with the attorney; Marx never read any document filed by the attorney; Marx simply signed the verification that Cavanaugh brought to him. (R.R. at 64a.) I would conclude that Marx’s lack of knowledge about the facts surrounding the bidding process negates any interest Marx might have had as a taxpayer in this matter.3 Rainey.

Unlike the majority, I would conclude that the trial court properly determined that Marx lacks standing. Therefore, the trial court erred in addressing the merits of this case. Accordingly, I would vacate the trial court’s order and remand for dismissal of the action for lack of standing.

. The requirement of a "substantial” interest simply means that there must be some discernible adverse effect to some interest other than the abstract interest of all citizens in having others comply with the law. Wm. Penn Parking Garage, Inc. v. City of Pittsburgh, 464 Pa. 168, 346 A.2d 269 (1975). The requirement that an interest be "direct” simply means that the person claiming to be aggrieved must show causation of the harm to his interest by the matter of which he complains. Id. The requirement of an "immediate” interest means that there must be a sufficiently close causal connection between the challenged action and the asserted injury. Id.

. With respect to the fifth element, this court stated that, because “disappointed bidders who are not taxpayers" cannot challenge bid awards, taxpayers are in the best position to challenge bid awards. Rainey 641 A.2d at 701. I believe that, in making this statement, this court suggests that disappointed bidders who also are taxpayers are better situated than other taxpayers to challenge bid awards. See Lutz Appellate Printers, Inc. v. Department of Property and Supplies, 472 Pa. 28, 370 A.2d 1210 (1977) (holding that a taxpayer who is also a disappointed bidder has standing to challenge a bid award).

. The majority interprets Rainey to mean that "knowledge of details is not necessary.” (Majority op. at 4.) However, Rainey makes a clear distinction between a taxpayer’s knowledge of legal details and a taxpayer's knowledge of factual details. Here, in providing an erroneous basis for his challenge, Marx’s testimony displays an unpardonable lack of knowledge of the factual details of this case, thereby depriving him of any standing he might otherwise claim. Rainey.