author: HERRON, J„

text:
    TJS Brokerage & Co. Inc. v. Hartford Casualty Insurance Co.

      Robin Grey, John Ellison and Robert Frankel, for plaintiff.

      Patrick Keenan, Thomas Close and Joseph Connor III, for defendants.
    July 26, 2002
   HERRON, J„

Defendant Hartford Casualty Insurance Co. filed this motion for nonsuit against plaintiff TJS Brokerage & Co. Inc. following TJS’s case in chief in its bad faith trial. For the reasons set forth below, Hartford’s motion is granted.

BACKGROUND

TJS, a transportation broker, is a Pennsylvania corporation located at 4940 Disston Street, Philadelphia, Pennsylvania. Customers contact TJS with freight to be shipped, and TJS arranges for trucking companies to carry the freight. Thomas J. Sicalides is the president and sole shareholder of TJS. In addition, he owns or did own, inter alia, T&T Freight Consolidators, located at 6918 State Road.

Hartford is an Indiana corporation, engaged in the business of selling insurance and located at Hartford Plaza, Hartford, Connecticut. Hartford sold a multi-risk insurance policy, no. 39UUCLE4914 to TJS. The policy was effective from June 18,1998, to June 18,1999. The named insureds under the policy were TJS, Keystone Transportation Inc., Garden State Transportation Inc., Beverly Hills Sales and Marketing Inc., Thomas Sicalides, Michael’s Transport Inc. and T&T Freight Consolidators.

Among other coverage, the policy included: (a) business income loss coverage of $1,200,000 with 80 percent co-insurance, (b) business personal property coverage of $350,000 with a $500 deductible and 80 percent co-insurance, (c) computer equipment coverage of $350,000 with 80 percent co-insurance, and (d) valuable papers coverage of $100,000 with a $250 deductible and no co-insurance. TJS purchased additional coverage such that the policy covered the full replacement cost of business personal property and computer equipment that was actually replaced.

On April 2,1999, Vincent Sicalides, Thomas Sicalides’ brother, allegedly vandalized the offices of TJS at 4940 Disston Street, the TJS warehouse, and the neighboring offices of T&T Freight Consolidators and Michael’s Trucking at 6918 State Road. TJS employees Gary Krinick and Steven Horvay were present at the TJS offices during the vandalism. Police arrived and took Vincent Sicalides into custody. TJS submitted claims to Hartford for business personal property, computer equipment, valuable papers and business income losses. While most of these claims had been resolved by the time of trial, the business income loss and phone switch claims remained at issue.

Within days of the vandalism incident Alan Mycek, the Hartford adjuster who handled TJS’s claim, visited the TJS premises. Between April 19,1999, and June 18, 1999, Hartford processed TJS’s claims and tendered eight checks to TJS totaling $533,297.15. On May 14, 1999, Hartford advanced $50,000 toward the April 1999 business income loss claim. On June 4, 1999, Hartford advanced $50,000 toward the May 1999 business income loss claim. Thereafter, Hartford refused to advance TJS any additional money toward the business income loss claim because TJS and the other named insureds in the policy had not provided Hartford with sufficient financial information to evaluate that claim.

Several factors complicated TJS’s submission of the requested information. First, some of the requested financial information was purportedly stored on the hard drives of the damaged computers. Second, in July 1999, the Department of Transportation seized TJS’s records. Third, Hartford’s requests for information were piecemeal such that it was not clear exactly what information Hartford needed. Fourth, TJS and the other named insureds appeared to have been less than meticulous record keepers. On December 6,1999, Hartford’s counsel informed TJS that the proof of loss that TJS submitted was incomplete. Between April 19, 1999, and June 18,1999, Hartford advanced $433,297.15 for TJS’s business personal property and computer equipment claims.

In its complaint, TJS asserted a claim of bad faith against Hartford in denying TJS’s benefits. TJS’s bad faith trial against Hartford commenced on March 6,2002. On May 29, 2002, following TJS’s case in chief, Hartford filed this motion for nonsuit. To the extent that it is relevant and helpful, this court’s opinion, dated April 22, 2002, is incorporated by reference. This opinion, presently on appeal, dealt with the non-bad faith claims tried to a jury and resulting in a verdict of $650,000 for business income loss and $2,488.60 for the phone switch claim in favor of plaintiff TJS.

DISCUSSION

I. Legal Standard

Pa.R.C.P. 230.1(a)(1) states that a court “may enter a nonsuit on any and all causes of action if, at the close of the plaintiff’s case on liability, the plaintiff has failed to establish a right to relief.” The court, in making this determination, must give:

“[T]he plaintiff the benefit of all reasonable inferences arising from the evidence. When so viewed, a nonsuit is properly entered if the plaintiff has not introduced sufficient evidence to establish the necessary elements to maintain a cause of action; it is the duty of the trial court to make this determination prior to the submission of the case to the jury.” Parker v. Freilich, 2002 WL 1308708 at 3 (Pa. Super. 2002) (citing Hong v. Pelagatti, 765 A.2d 1117, 1121 (Pa. Super. 2000)).

The Pennsylvania Superior Court has spoken on what is necessary to establish a bad faith insurance claim:

“Insurance. ‘Bad faith’ on part of insurer is any frivolous or unfounded refusal to pay proceeds of a policy; it is not necessary that such refusal be fraudulent. For purposes of an action against an insurer for failure to pay a claim, such conduct imports a dishonest purpose and means a breach of a known duty (i.e., good faith and fair dealing), through some motive of self-interest or ill will; mere negligence or bad judgment is not bad faith. Black’s Law Dictionary 139 (6th ed. 1990)....
“Further, bad faith must be proven by clear and convincing evidence and not merely insinuated.... Finally, to recover under a claim of bad faith, the plaintiff must show that the defendant did not have a reasonable basis for denying benefits under the policy and that defendant knew or recklessly disregarded its lack of reasonable basis in denying the claim.” Terletsky v. Prudential Property & Casualty Insurance Co., 437 Pa. Super. 108, 125, 649 A.2d 680, 688 (1994). (citations omitted)

A. TJS Has Not Met Its Burden of Showing That Hartford Lacked a Reasonable Basis For Denying Benefits to TJS

As discussed above, the plaintiff has the burden of proving bad faith by clear and convincing evidence. Terletsky at 125, 649 A.2d at 688. Here, even if the court gives TJS the benefit of all reasonable inferences arising from the evidence it provided, TJS has still failed to establish the necessary elements to maintain a bad faith claim. Although TJS argues that Hartford acted in bad faith in processing its claim, it fails to provide clear and convincing evidence to support its argument. TJS urges that in denying benefits, Hartford improperly relied on Steve Lieb, William Mooney, and Amie Friedman for information regarding TJS’s negative business and financial condition. Pi’s opp. brief ¶15. Specifically, TJS argues that it was unreasonable for Hartford to rely on these “liars” when it could have asked TJS’s financial representatives about TJS’s financial condition. Id. at ¶¶15-21. However, TJS does not offer evidence suggesting that Hartford lacked a reasonable basis for denying benefits. In fact, as Hartford correctly suggests, TJS “did not present any evidence of the state of mind of Hartford.” Def’s mem. of law at 5.

TJS also asserts that Hartford acted in bad faith when it neither denied nor accepted the proof of loss, when it failed to update TJS as to the status of the claim, and when it repeatedly asked for the “same information over and over again.” Pi’s opp. brief ¶¶4-6, 10, 12, 32. However, again, at no point does TJS offer clear and convincing evidence of Hartford’s lack of a reasonable basis for these actions. Admittedly, these actions of Hartford may be considered negligent, or bad judgment, but it hardly arises to the level of bad faith espoused by the Superior Court in Terletsky. Terletsky at 125, 649 A.2d at 688 (citing Black’s Law Dictionary, 139 (6th ed. 1990) to hold that “mere negligence or bad judgment is not bad faith”).

Finally, TJS cites to several cases without explaining how these cases are relevant or how these help TJS meet its heavy burden of showing how Hartford acted in bad faith. Pi’s resp. mem. of law at 3. Specifically, TJS proclaims that Hartford’s actions were “outrageous” and “with a dishonest purpose and evil motive,” but fails to provide this court with any evidence, let alone clear and convincing evidence, of how these actions qualify as such. See Jung v. Nationwide Mutual Insurance Co., 949 F. Supp. 353, 360 (E.D. Pa. 1997) (granting summary judgment on a bad faith claim, holding that in the absence of evidence revealing a dishonest purpose, it is not bad faith for insurer to aggressively investigate and protect its interests). Without clear and convincing evidence of Hartford’s lack of reasonable basis in denying benefits to TJS, this court must grant Hartford’s motion for nonsuit.

II. Hartford Had Several Reasonable Bases In Denying Benefits To TJS

Although TJS has failed to show that Hartford lacked a reasonable basis, Hartford, on the other hand, has successfully shown that it had several reasonable bases to deny benefits. Pursuant to the insurance policy TJS had with Hartford, the coverage provided is void:

“[I]n any case of fraud by you as it relates to this coverage part at any time. It is also void if you or any other insured, at any time, intentionally conceal or misrepresent a material fact concerning:
“(1) This coverage part;
“(2) The covered property;
“(3) Your interest in the covered property; or
“(4) A claim under this coverage part.” Def’s mem. of law at 5 (citing exhibit D-549, Commercial Property Conditions form (CP 00 90 07 88), section A, p. 1 of 2).

After an investigation, Hartford denied benefits as it concluded that TJS had misrepresented several material facts including, inter alia, the whereabouts of Vincent Sicalides, the absence of computer back-up tapes, the amount TJS paid Sprint for the new phone switch, and the manner in which the vandalism loss occurred. Def’s mem. of law at 7. As discussed below, this court agrees with Hartford and holds that it had several reasonable bases for denying benefits to TJS.

A. Whereabouts of Vincent Sicalides

Hartford reasonably concluded that Thomas Sicalides concealed the whereabouts of Vincent Sicalides, his brother, thereby breaching the policy provision discussed above. Hartford directs this court to several occasions when Thomas Sicalides claimed not to know of his brother’s whereabouts following the vandalism. Id. at 6 (citing N.T. 11/27/01 at 78-80, 83, 84-86, 87, 89-91). However, Hartford argues that it had a reasonable basis to believe that Thomas Sicalides falsely denied knowing the whereabouts of his brother. Specifically, Hartford explains that during its investigation it discovered, inter alia, that Vincent Sicalides was living with his sister, Mary Louise, in Texas, Thomas Sicalides spoke frequently with Mary Louise following the vandalism, and there was videotape of Vincent Sicalides at the home of Mary Louise. Def’s mem. of law at 6-9 (citing N.T. 11/ 27/01 at 88, 91-94, 95-99, 101, 102-103; N.T. 11/28/01 at 123-24, 133-35, 139; N.T. 11/29/01 114-15, 117, 124-25,134; N.T. 11/30/01 at 8,21-22,25,30). As Hartford correctly concluded, “[t]he evidence gathered . . . provided ample support for its reasonable belief that Thomas Sicalides knew the whereabouts of Vincent Sicalides, had spoken to him, and concealed this information from Hartford.” Def’s mem. of law at 9.

TJS counters arguing that “Hartford failed to present any reliable or credible evidence at any time during this litigation that Tom Sicalides knew the location of his brother Vincent Sicalides.” Pi’s resp. mem. of law at 8. However, TJS ignores the fact that the focus of the inquiry is whether Hartford had a reasonable basis to deny benefits, not whether Thomas Sicalides actually knew of the location of his brother. Given the conflicting statements by Thomas Sicalides, and the various sightings of Vincent Sicalides, there was ample support for Hartford to deny benefits as it reasonably believed that Thomas Sicalides was concealing the whereabouts of his brother. See O’Donnell v. Allstate Insurance Co., 734 A.2d 901, 907-908 n.7 (Pa. Super. 1999) (dismissing a bad faith claim relying upon these reasonable bases or “red flags” of insurer; failure of claimant to provide accurate information about the whereabouts of her mother, the insured; statements by the claimant that she didn’t want the insured to know about the loss; allegations of a burglary by claimant, but police reports indicating there were no signs of forced entry; and claimant’s refusal to provide contact information of co-purchaser of stolen items for insurer’s verification).

B. Computer Back-up Tapes and Amount Paid for Phone Switch

Hartford also reasonably concluded that TJS concealed the existence of computer back-up tapes in order to prevent Hartford from discovering the unfavorable financial state of TJS. Def’s mem. of law at 9. Hartford argues that the following facts supported this conclusion: TJS refused to take Hartford’s offer to send the damaged computer hard drive to a firm in New Hampshire to retrieve financial information; Hartford was not advised of the fact that TJS created nightly back-up tapes of data from the computer system and stored them in a secured area; and Hartford was not given the 1998 trial balance which would have showed financial losses for TJS that were higher than those reported in earlier financial statements. Def’s mem. of law at 9 (citing N.T. 11/27/01 at 128-29; N.T. 11/28/01 at 174-75; N.T. 11/29/01 at 38-42, 108-109, 133; N.T. 11/30/01 at 63-68; N.T. 3/6/02 at 159-62,174-76). It is clear to this court that this conduct provided a reasonable basis for Hartford to deny benefits.

TJS counters arguing that “Hartford is attempting to convince this court that because Hartford did not take the back-up tapes and hard drive to New Hampshire, and based upon the statement of a known liar and direct competitor, Steve Lieb, Hartford was prejudiced in its attempt to prove that plaintiff was in a poor finanical condition.” Pi’s resp. mem. of law at 9. However, TJS incorrectly represents Hartford’s argument as it is not arguing prejudice. Hartford, instead, argues that the conflicting evidence regarding the back-up tapes provided a reasonable basis to deny benefits to TJS. This court agrees.

In addition to the conduct surrounding the back-up tapes, TJS’s alleged misrepresentations concerning the amount it agreed to and did pay for the new phone switch also provided Hartford a reasonable basis from which to deny benefits. Pursuant to the insurance policy, Hartford would pay TJS the “amount you actually spend that is necessary to repair or replace the lost or damaged property.” Def’s mem. of law at 10 (citing D-549, Building and Personal Property Coverage form, “G. Optional coverages” ¶3(6)(3), p. 11 of 11). Although TJS represented that Sprint had been paid $266,280.20 for the new phone switch, and that it denied any discussions with Sprint to reduce the price of the phone switch below $263,000, TJS only paid Sprint $152,000. Def’s mem. of law at 10 (citing N.T. 11/27/01 at 112-14,115-16,124). Moreover, TJS allegedly withheld documentation showing that, after some changes to the original phone switch order, the final price of the phone switch was $213,699. Id. (citing N.T. 11/27/01 at 117-19, 122-25; 11/30/01 at 34-37, 48-49, 59-60; N.T. 3/6/02 130-36). Since Hartford had already paid TJS $263,731.60 for the phone switch and then discovered the subsequent conflicting evidence, this court concludes that Hartford had a reasonable basis for denying benefits as it believed that TJS misrepresented the amount it agreed to and did pay for the phone switch. See Leo v. State Farm Mutual Auto. Insurance Co., 939 F. Supp. 1186 (E.D. Pa. 1996) (holding that the following all amount to an insurance company’s reasonable basis for denying benefits and therefore are not bad faith: conflicting medical records regarding injuries; plaintiffs having been fully compensated for out of pocket expenses with an amount less than amount of coverage; and an insurance company’s request for a statement under oath regarding injuries).

C. The Manner in Which Loss Occurred

Based on the conflicting reports and testimony, Hartford had a reasonable basis for concluding that TJS misrepresented the manner in which the loss occurred. For example, Hartford shows that although Thomas Sicalides testified that Vincent Sicalides was enraged prior to the vandalism, another TJS employee noticed that when she left work on the day of the vandalism, “Vincent seemed fine; he was not enraged ....” Def’s mem. of law at 11 (citing N.T. 11/27/01 at 73; N.T. 11/29/01 at 148-49).

Further, Hartford’s investigation revealed conflicting evidence regarding the time and duration of the vandalism. On the one hand, there was information that Vincent Sicalides vandalized both TJS’s and T&T’s property during a 15 to 30 minute window of opportunity. Id. (citing N.T. 11/27/01 at 72; N.T. 11/29/01 at 148). However, Hartford directs this court to testimony suggesting that Thomas Sicalides may have been involved in the vandalism at T&T as well. Id. Specifically, Hartford provides the testimony of Steve Horvay, who although he witnessed Vincent Sicalides break a lightbulb at TJS, did not witness any damage at T&T, even though he was at T&T moments before Vincent Sicalides was arrested at TJS. Id. at 12 (citing N.T. 11/28/01 at 102-107, 109). In fact, Horvay testified that he first learned of any damage to T&T when he was told by Thomas Sicalides. Id. (N.T. 11/28/01 at 107, 109). Hartford therefore reasonably concluded that the manner in which the damages occurred to TJS and T&T may have been misrepresented, since “[t]he damage was only ‘discovered’ after Vincent was arrested at TJS, and it was ‘discovered’ by Thomas Sicalides who would have had access to the T&T office.” Id. Given all this conflicting testimony, this court concludes that Hartford had a reasonable basis to deny TJS its benefits. Terletsky at 126-28, 649 A.2d at 689 (holding that insurance company did not act in bad faith because the following constituted reasonable bases in denying benefits to a covered motorist: conflicting information regarding medical diagnoses, varying accounts of the questionable severity of injuries; unsettled Pennsylvania law on “stacking”).

Having shown that it had a reasonable basis, and that TJS has failed to establish its right to relief, Hartford’s motion for nonsuit is granted.

CONCLUSION

For the reasons discussed above, Hartford’s motion for nonsuit is granted.

ORDER

And now, July 26,2002, upon the consideration of the motion for nonsuit of Hartford Casualty Insurance Co., the responses thereto, the trial record, and in accordance with the opinion being filed contemporaneously with this order, it is hereby ordered and decreed that the motion for nonsuit is granted.

      . Thomas Peterman, TJS’s insurance broker, was also in attendance.

      . Specifically, TJS directs this court to Focht v. Rabada, 217 Pa. Super. 35, 38, 268 A.2d 157, 159 (1970), and Jung v. Nationwide Mutual Insurance Co., 949 F. Supp. 353, 360 (E.D. Pa. 1997).

      . As discussed above, TJS maintains offices on 4940 Disston Street and T&T maintains offices on 6918 State Road. TJS alleges that both these facilities were vandalized by Vincent Sicalides.


source: Caselaw Access Project

author: WETTICK JR., J,

license: Public Domain

text:
    Miller v. Board of Property Assessment, Appeals and Review of Allegheny County

      C.P. of Allegheny County,
    no. GD96-7312.

      Harlan S. Stone, for plaintiffs.

      Terrence F. McVerry and George M. Janocsko, for defendant County of Allegheny.

      John Cambest, for defendant Allegheny County Council.
    February 8, 2002
   WETTICK JR., J,

The subject of this opinion and order of court is a petition for special relief filed on behalf of Allegheny County by the Allegheny County Law Department at the direction of the chief executive. Portions of the petition are opposed by county council, represented by the solicitor of county council.

In part I of this opinion, I consider whether the official county assessment of real property for 2002 is the assessment certified by the Property Assessment Oversight Board on January 8, 2002, or the assessment provided for in two ordinances adopted by county council on February 5, 2002.

In part II of this opinion, I consider whether changes to the existing assessment system that county council and the county executive wish to make are inconsistent with any of my prior orders of court. I am addressing this issue at this time in order that taxpayers and taxing bodies may know whether the assessed values of the 2002 assessment (as modified as a result of appeals or administrative changes) will be the assessed values for years 2003-2005.

I.

Section 209.09 of the Administrative Code of Allegheny County, enacted on June 20, 2000, required the chief executive to present to county council a proposed ordinance which would, inter alia, set forth a methodology for the valuation of properties for taxation purposes, set standards for property assessments, and require annual reassessments through a professionally developed and maintained computer assisted mass appraisal (CAMA) system. Section 209.09 reads, in its entirety, as follows:

“Section 209.09 assessment standards and practices ordinance
“The chief executive shall, after considering the recommendations of the Board of Assessment Oversight and of the chief assessment officer, present to county council a proposed ordinance for adoption that shall:
“(A) Set forth a methodology for the valuation of properties for taxation purposes;
“(B) Set standards for property assessments that shall include, at a minimum, an acceptable limit on the deviation of the common level ratio from the 100 percent predetermined ratio, an acceptable limit on the coefficient of dispersion, and an acceptable range for the price-related differential. These standards shall be applied to the assessments within each taxing jurisdiction and, in the City of Pittsburgh, to the assessments within each ward. The measurements against the standards shall be calculated following nationally recognized practices;
“(C) Require an annual reassessment through a professionally developed and maintained computer assisted mass appraisal system;
“(D) Require that the annual reassessment be applied to all properties, including tax-exempt property, public utility property, and residential trailers;
“(E) Establish standards for recommending tax exemption for properties; and
“(F) Establish procedure for changing values on an administrative basis (e.g., catastrophic loss, errors in data, initial recommendation on tax exemption, etc.).”

Chapter 205 of the Administrative Code, enacted on June 20,2000, created a Property Assessment Oversight Board that recommends assessment standards and practices to county council, confirms or rejects the appointment of the chief assessment officer, and certifies that assessments, as determined by the Office of Property Assessments, have been made in accordance with the county Assessment Standards and Practices Ordinance.

For tax year 2001, the Oversight Board certified that a report prepared by the Office of Property Assessments was a trae and correct copy of the total value of real property appearing in the assessment rolls of Allegheny County as of January 8, 2001.

On December 11, 2001, county council adopted the Allegheny County Assessment Standards and Practices Ordinance. Section 201.03 of the ordinance states that “[t]he Office of Property Assessments through the chief assessment officer shall perform an annual valuation of all objects of taxation in the county by the development and maintenance of a CAMA system.” (emphasis added)

Section 301.03-C provides that if “the ratio study of the county wide valuations of objects of taxation for the applicable tax year meets the IAAO Performance Standards, then the chief assessment officer shall prepare a request for certification in accordance with section 401.01 of this ordinance.” Under section 401.01, on or before the first business day of January of each year, the Office of Property Assessments through the chief assessment officer shall submit an official request for certification to the Oversight Board. Based on the official request for certification, the Oversight Board shall meet and vote to approve the certification on or before the fifteenth day of January. (Section 401.02.) Upon certification, the Office of Property Assessments shall provide the values of the objects of taxation contained in the certification to all taxing bodies within the county for use in levying property taxes. (Section 401.03.)

In accordance with the Administrative Code of Allegheny County and section 201.03 of the Assessment Ordinance, the Office of Property Assessments through the chief assessment officer performed an annual reassessment in year 2001 for use in year 2002 through a professionally developed and maintained computer assisted mass appraisal system. Pursuant to section 401.01 of the Assessment Ordinance, the chief assessment officer submitted an official request for certification to the Oversight Board. On January 8, 2002, the Oversight Board voted, by a two to one vote, to approve the certification pursuant to the provisions of section 401.02 of the Assessment Ordinance and section 205.06(C) of the Administrative Code. Upon certification, pursuant to section 401.03 of the Assessment Ordinance, the Office of Property Assessments proceeded “to cause its clerks to provide the values of the objects of taxation contained in the certification to all taxing bodies within the county for use in the levying of property taxes.” At least one municipality (City of Pittsburgh) and one school district (Pittsburgh School District) have mailed tax notices in reliance on the certification.

On February 5,2002, county council adopted an ordinance (first ordinance) which amended article II of the Administrative Code to eliminate the term “annual reassessment” and to provide for a county wide reassessment by the Office of Property Assessments every three years. (County council exhibit 1.) It changed the process of levying taxes by providing for a preliminary valuation on real property to be released April 1st of each year with the immediate right to appeal, and for the assessed values as of September 30th to be released on October 1st as the assessed value for taxation purposes in the subsequent year. Section 4 of the ordinance provided for special provisions for transition to three-year assessment. This section reads as follows:

“Special provisions for transition to three-year assessment.
“For the purposes of levying taxes for calendar year 2002, the valuations of real property as recorded as of December 31, 2001, will be used.
“The certified assessment issued for 2002 will serve as preliminary valuations for 2002. The values will be the basis of appeals during calendar year 2002. November 1, 2002, will be the date at which the assessed value of properties will be published for the purpose of establishing tax levies for tax year 2003.”

The first ordinance also includes the following:

“Allegheny County taxing body shall file a mass appeal for the 71,000 property owners whose assessment was lowered for 2002. The 2002 lower assessment shall be accepted as evidence for reduction. All appeals shall be decided and findings processed before the discount date.”

Thereafter, at the same meeting, county council enacted another ordinance (second ordinance) amending articles II, III, and IV of the Allegheny County Assessment Ordinance. (County council exhibit 2.)

Section 201.03 was amended to require the Office of Property Assessments through the chief assessment officer to perform triennial valuations. It provided that the “[assessed values on objects of taxation for the first triennial assessment shall be presented to the Oversight Board in January of2002 (as set forth in article IV hereof) for use in tax years 2003,2004 and 2005 and shall repeat every third year thereafter in a similar pattern .... The Office of Property Assessments through the chief assessment officer shall perform such triennial valuation of all objects of taxation in the county by the development and maintenance of a CAMA system.”

Section 401.01(A) creates a certification year beginning in year 2002 and continuing every third year thereafter. Section 401.02 provides that during each certification year, the assessed value of each property shall be its most recently certified value (as this may have been modified as a result of appeals or administrative changes). This section further provides that “Notwithstanding the foregoing, for each property (other than taxing body appealed properties (as defined below)) that has an assessment which, as a result of such triennial reassessment is less than the then-current assessment, such lower assessed value shall be used as the assessed value for such property in the current year (i.e., for certification year 2002, if a property has an assessed value which is lower than the assessed value in 2001, the assessment shall be used for tax year 2002 as well as 2003, 2004, and 2005).

Under this provision, the assessed value of a property for year 2002 is the lower of the 2001 or 2002 assessed value. Since the second ordinance is inconsistent with the first ordinance which uses only 2001 values, the second ordinance, being later in time, must be construed as modifying the first ordinance.

The legal issue that I address is whether the legislative body of Allegheny County may replace an assessment that was certified in accordance with existing law with an assessment that it subsequently created. The assessment which county council has created is an assessment based on the lesser of (i) the assessed value of a property as of December 31, 2001, or (ii) the assessed value of a property as certified by the Oversight Board for 2002. County council supports its action on the ground that it is moving to a triennial system through which appeals will be resolved before a reassessment takes effect and the assessment which it created for year 2002 is the most appropriate measure during this transitional period.

This dispute involves only the county executive and county council because the setting of the official assessment for a given year is not a matter in which taxpayers or municipalities/school districts are participants. While the law may permit taxpayers and taxing bodies to challenge the official countywide assessment, they cannot do so until it is determined whether the official assessment for Allegheny County for year 2002 is the assessment certified by the Oversight Board on January 8,2002, or the assessment adopted by county council through the ordinances enacted on February 5, 2002. Once there has been a judicial determination of which assessment governs year 2002, taxpayers may file appeals, administrative changes may be made, and taxpayers and taxing bodies with standing may initiate legislation for the purpose of altering the official county assessment for year 2002.

For several reasons, I find that county council lacked authority to substitute an assessment which it found to be more equitable for the assessment certified on January 8, 2002.

State law does not authorize a legislative body of a county to make, adopt, or alter assessments. Assessors make assessments. The role of the governing bodies of the county is limited to establishing assessment standards, creating an independent appeal process, and creating and funding a separate office of property assessment. The General County Assessment Law (72 P.S. §5020-101 et seq.) and the assessment legislation for the various classes of counties have (i) created separate boards that are responsible for making assessments (consider the Board of Property Assessment, Appeals and Review provided for in the Second Class County Law, 72 P.S. §5452.1 et seq.) and/or (ii) provided for assessments to be the responsibility of a chief assessment officer. See e.g., 72 P.S. §5453.602 (Supp. 2001). While certain assessment legislation provides for county commissioners to consider appeals concerning individual properties, a county governing body has never had the authority to adopt or create the official assessment for the county. State law is clear that a county governing body which uses the assessed values in setting taxes cannot be the decision-maker in setting the assessed values for the county. This must be done by a separate entity.

Counsel for county council contends that the county council has the power to establish the year 2002 assessment through the February 5, 2002 ordinances because of the power vested in the county under the Home Rule legislation. However, the county is subject to the following charter limitation set forth in the Second Class County Charter Law:

“(h) With respect to the following subjects, the charter shall not give any power or authority to the county contrary to, or in limitation or enlargement of, powers granted by acts of the General Assembly which are applicable to counties of the second class: ...
“(8) The assessment of real or personal property and persons for taxation purposes.” Act of May 20, 1997, RL. 149, §3107-C(h)(8), 16 P.S. §6107-C(h)(8).

The Second Class County Assessment Law, enacted on June 21, 1939, 72 P.S. §5452.1 et seq., gives full responsibility and control over the assessment system to a board of property assessment, appeals and review. See generally, Miller v. Board of Property Assessment Appeals and Review of Allegheny County, 145 P.L.J. 501 (1997).

Under this legislation, it was the exclusive responsibility of the Assessment Board to make, revise, and equalize all assessments and to certify, on or before January fifteenth of each year, the total value of real property appearing in the assessment roll and taxable by the political subdivisions. 72 P.S. §5452.17a. The Assessment Board was also responsible for hearing assessment appeals.

As I have previously discussed, on June 20, 2000, county council added three chapters to the Administrative Code of Allegheny County: Chapter 205 — Property Assessment Oversight Board; Chapter 207 — New Board of Property Assessment Appeals and Review; and Chapter 209 — Office of Property Assessments. These chapters created a new assessment system, replacing the Assessment Board with three entities that would perform the functions that were performed by the Assessment Board under the Second Class County Assessment Law.

In Board of Property Assessment, Appeals and Review v. County of Allegheny, 148 P.L.J. 284 (2000), I considered the request of the Assessment Board that I declare the provisions of the ordinance creating a different assessment system to be in violation of state law. It was the position of the Assessment Board that the county did not have the authority to change the Second Class County Assessment Law. The Assessment Board relied on Charter Limitation §3107-C(h)(8).

I ruled in favor of Allegheny County. I did so because I believed that Charter Limitation §3107-C(h)(8) only covered valuations of properties. Under the assessment system the county had created, valuations would be the responsibility of a separate office of property assessments. The certification would be performed by a separate body (i.e., an oversight board). Appeals would be heard by an independent body. Consequently, I concluded that the county’s Home Rule assessment system did not violate state law because bodies separate from the county council and the county executive were responsible for making and adopting the official county assessment.

My opinion relied on Lennox v. Clark, 372 Pa. 355, 93 A.2d 834 (1953), in which the Supreme Court was construing the Home Rule Act governing Philadelphia which provided that the city could not exercise powers contrary to or in limitation or enlargement of powers granted by acts of the General Assembly “providing for the assessment of real and personal property and persons for taxation purposes.” The court ruled that this restriction did not bar Philadelphia from transforming county employees of the Board of Revision of Taxes (a county office) into city employees. The court stated:

“What was obviously intended by that provision of the statute was that the city should not have the power to legislate in regard to the substantive rules governing the making of assessments and valuations of property. For example, the city cannot change the provision of section 13 of the Act of 1939 (under which the board now operates) that all taxable property shall be valued and assessed by the assessors and by the board at the actual value thereof, in determining the price for which it would bona fide sell shall be considered but [shall] not be controlling.” 372 Pa. at 376-77, 93 A.2d at 844.

In Board of Property, Assessment, Appeals, Review and Registry of Allegheny County v. County of Allegheny, 773 A.2d 816 (Pa. Commw. 2001), a divided Commonwealth Court affirmed my ruling. The court’s opinion stated that there were two possible meanings to Charter Limitation 3107-C(h)(8) prohibiting local governments through their home rule charters from modifying the system for making valuations of property for taxation purposes. The word “assessment” could refer to the “entire plan or scheme” for making assessments. However, it could also refer only to the valuation of property for taxation purposes. The court stated:

“Given the fact that state law requires individuals who make valuations of real property for taxation purposes in counties throughout the Commonwealth to have special expertise, section 3107-C(h)(8) of the Charier Law could be read to prohibit second class counties from interfering with the professional valuation work done by certified Pennsylvania evaluators within such counties. Because this represents a second reasonable construction of section 3107-C(h)(8), we conclude, like the trial court, that the statutory language is ambiguous.” Id. at 820. (emphasis added)

The court ruled that I did not err in determining the proper meaning of section 3107-C(h)(8) of the Charter Law:

“In section 3107-C of the Charter Law, the General Assembly specifically limits a home rule county’s powers and functions with regard to the assessment of real or personal property and persons for taxation purposes. As indicated above, section 3107-C(h)(8) of the Charter Law only pertains to and restricts the county’s power to interfere with the substantive rules governing the valuation of property by professional assessors.” Id. at 821.

The February 5,2002 ordinances would violate Charter Limitation 3107-C(h)(8) because the county legislative body is substituting its judgment, concerning the valuation of property, for the judgment of professional and independent entities that established the official assessment for Allegheny County. If the county, through an ordinance, may establish the official assessment for the county, the provisions of Charter Limitation 3107-C (h)(8) would have no meaning. In Board of Property, Assessment, Appeals, Review and Registry, supra, the Commonwealth Court clearly stated that Charter Limitation 3107-C(h)(8) prohibits the county from enacting ordinances that interfere with professional evaluation work. Thus, the county cannot adopt an ordinance which sets assessed values.

There is a second reason why the February 5, 2002 ordinances are invalid. State law uses a certification procedure for establishing the official county assessment for a given year. Once the assessment has been certified, taxing bodies and taxpayers may rely on the assessment. This assessment cannot be altered by a county governing body at a later date because of a dissatisfaction with the values. In the present case, the assessment was certified under the procedures provided for by existing law. After the date of certification, the county has no authority to retroactively alter assessment standards or to retroactively replace the certified assessment with an assessment that its governing body finds to be fairer. As counsel for the Pittsburgh School District recognized at pages 4-5 of its amicus brief, “If county council’s position is accepted by the court, there is nothing to prevent county council from changing assessments periodically throughout the year thus destroying any stability to the tax base and rendering the certification process a nullity.”

In addition, the February 5, 2002 county ordinances bypass any certification procedures. In January 2001, the Oversight Board certified an assessment for 2001 submitted by the Office of Property Assessments. In January 2002, the Oversight Board certified a reassessment for year 2002 submitted by the Office of Property Assessments. No body has ever certified the hybrid assessment for year 2002 set forth in the February 5, 2002 ordinances.

Finally, there is no basis in the law for an ordinance directing the county to file appeals on behalf of property owners to those assessments which the ordinance creates. County council is saying that the county must assist property owners in defeating an assessment that it created.

For these reasons, I rule that the January 8, 2002 assessment is the official assessment of Allegheny County for 2002.

II.

The petition for special relief also requests that I clarify prior orders of court which I have entered with respect to matters covered in the February 5, 2002 county ordinances that are supported by the county executive. The relief is sought because there may be language in prior court orders which state or suggest that the county may not proceed with any assessment system that does not provide for annual countywide reassessments.

The petition for special relief requests that I permit the county to implement a system providing for a countywide reassessment every three years with 2003 serving as the initial base year and with the 2002 certified valuations serving as the valuations for this base year. The county executive and county council believe that annual countywide reassessments of real property require the county to devote extensive resources to the appeal process, which could otherwise be used to improve the assessment system. Taxpayers may be forced to file and pursue appeals on an annual basis. Also, taxpayers want greater certainty as to the amount of real estate taxes they may owe.

I do not disagree with the position of county council and the county executive that an assessment system which provides for county wide reassessments every three years protects the integrity of the assessment system while minimizing the burdens imposed on the county and the taxpayers. While there may be language in prior court orders referring to annual countywide reassessments, this would be because the county’s proposals provided for annual reassessments.

It is my understanding that few, if any, counties conduct annual reassessments. There is nothing inconsistent with a countywide reassessment every three years and my previous rulings requiring the county to implement an assessment system that complies with state law.

I recognize that the triennial assessment system provided for in the Second Class County Assessment Law was found to be unconstitutional. However, the basis for the unconstitutionality was a reassessment of one-third of the county each year. Consequently, taxpayers in one area would be paying taxes on 1980 values, taxpayers in a second area would be paying taxes on 1981 values, and taxpayers in a third area would be paying taxes on 1982 values. The February 5,2002 ordinances have corrected this problem. The procedure set forth in the February 5, 2002 county ordinances provides for a single county wide reassessment every three years so taxpayers throughout the county will be paying taxes based on the same year.

In addition, the use of year 2002 as a base year for 2003 is not inconsistent with my previous rulings. The apparent purpose is to give the county two “appeal free” years (2003 and 2004) in which to improve the accuracy of the descriptions of properties throughout the county and to use year 2005 to decide appeals for the 2006 base year.

Finally, the petition for special relief requests that the county be permitted to use year 2001 values reduced through the appeal process for year 2002 for those taxpayers whose assessments were increased in year 2002 from 2001 assessments established through appeals of the 2001 assessments. It is the position of the county that the rulings made in the appeal process in year 2001 should apply in year 2002 because there has been a “breakdown in the assessment machinery.” The county believes that many of the reductions of 2001 assessed values made in the appeal process were based on evidence showing that the actual characteristics of the property varied from the characteristics in the assessment records. This information as to the actual characteristics of the properties should have been, but was not, made available to the Assessment Office before it established the year 2002 values. The county believes that it will be making administrative changes to many of these properties that will alter the year 2002 assessments, so the year 2001 assessments for these properties may be more accurate than the 2002 assessments.

The county is a taxing body. It should not be permitted to take advantage of the breakdown in the assessment process where this will result in higher assessments (i.e., more taxes). Consequently, the 2002 assessed values will apply where the 2002 assessed values are less than the 2001 assessed values following the appeal process (i.e., taxing body appealed properties). However, where an assessed value for 2002 is higher than the assessed value for 2001, as established in the appeal process, and there have not been physical changes to the property, the 2002 assessed value shall be reduced, only for year 2002, to the 2001 assessed value following the appeal (with the right of the taxing bodies to appeal).

There is legislative support for this concept of using in the subsequent year the values established for the prior year as a result of an assessment appeal. See the Second Class A and Third Class County Assessment Law at 72 P.S. §5349.5 (Supp. 2001) which reads as follows:

“(a) Except as provided in subsection (b) of this section, for purposes of taxation, when there is a change in assessment made by the board as a result of an assessment appeal, a taxing district shall apply the changed assessment in computing taxes imposed in the next fiscal year of the taxing district following the fiscal year in which the board heard the appeal and rendered its decision.”

Generally, a home rule municipality may adopt any feature of an assessment system recognized in state law.

Summary

A.

The governing body of a county has no power to change assessments that were established in accordance with existing law. In Allegheny County, the Office of Property Assessments has the sole responsibility for valuing property and the Property Assessment Oversight Board has the sole responsibility for certifying assessments. Under state law, the governing body of a county may not establish or change assessments. In 2001, in the case of Board of Property, Assessment, Appeals, Review and Registry of Allegheny County v. County of Allegheny, 773 A.2d 816, 820 (Pa. Commw. 2001), the Pennsylvania Commonwealth Court said that “state law requires individuals who make valuations of real property for taxation purposes in counties throughout the Commonwealth to have special expertise” and that section 3107-C(h)(8) of the Charter Law prohibits the governing body of a second class county “from interfering with the professional valuation work done by certified Pennsylvania evaluators within such counties.”

Under state law, an assessment for a particular year becomes the official assessment for that year once it has been certified. If the position of county council would become the law of Pennsylvania, there would be nothing to prevent county council from changing assessments periodically throughout the year, thus destroying any stability to the tax base and rendering the certification process a nullity. Municipalities and school districts cannot perform their responsibilities unless they can establish budgets and set millage based on the certified assessment.

For both of these reasons, the assessment certified by the Oversight Board on January 8, 2002 is the official assessment for Allegheny County for year 2002.

B.

In the future, the county is permitted to conduct countywide reassessments every three years, rather than every year. The county may use 2003 as a base year for 2004 and 2005. It may use the 2002 assessed values (as modified by appeals and administrative changes) for the 2003 values. Since 2003 is a base year, these values will also apply to 2004 and 2005.

In 2003 and 2004, the Assessment Office will correct and update data concerning the characteristics of the properties throughout the county. In early 2005, the Office of Property Assessments, through the use of a CAMA system as provided for in the county Assessment Ordinance, may establish values for the 2006 base year. Taxpayers and taxing bodies will be given the opportunity to file appeals and receive decisions in 2005 in order that taxes are paid on the values as determined through the appeal process.

C.

There is a class of taxpayers whose assessments were increased in year 2002 from 2001 assessments that were reduced through the appeal process. The county states that, as to these taxpayers, there has been a breakdown in the assessment machinery. According to the county, many of the reductions of the 2001 assessed values made in the appeal process were based on evidence showing that the actual characteristics of the properties varied from the characteristics in the assessment records. This information should have been, but was not, furnished to the Office of Property Assessments when it established the year 2002 values. The county states that it will be making administrative changes to many of these properties that will alter the year 2002 values, so the year 2001 reduced assessments for these properties — because of the county’s failures to follow its assessment procedures— may be more accurate than the 2002 assessments. There is also legislation governing second class A and third class counties which provides that when there is a change in an assessment made by the assessment board as a result of an assessment appeal, the taxing district shall apply the changed assessment in computing taxes imposed in the next fiscal year following the fiscal year in which the board heard the appeal and rendered its decision.

For year 2002 only, property owners whose assessments for year 2002 were increased following a reduction in 2001, as a result of an assessment appeal, will pay taxes based on the values established through the 2001 assessment appeal.

ORDER

On February 8, 2002, upon consideration of the petition for special relief filed by Allegheny County, it is ordered, adjudged and decreed that:

(1) the county is permitted to implement an assessment system under which there is a countywide reassessment every three years;

(2) the county is permitted to implement an assessment system whereby valuations for all properties are certified and distributed early in the year prior to the base year to permit taxpayers and taxing bodies to appeal the valuations and receive decisions on the appeals in this prior year in order that taxes are paid based on the values as determined by the appeal process;

(3) the county is permitted to implement the assessment system described in paragraph one of this court order by using 2003 as the initial base year and by using the 2002 certified values (as modified as a result of appeals or administrative changes) as the values for the base year;

(4)(a) where there was a reduction in the 2001 assessment (and no appeal is pending) as a result of an assessment appeal of only the 2001 assessment, for 2002 only, the reduced 2001 value (if lower than the assessed 2002 value) shall be the assessed value on which the taxing bodies shall compute taxes for the 2002 calendar/fiscal year;

(b) subparagraph (4)(a) does not preclude a taxing body from filing an appeal for 2002 from the reduced 2001 value;

(c) subparagraph (4)(a) applies only for year 2002. In the absence of another county wide reassessment, the assessed value established through the January 8, 2002 assessment will be the assessed value for subsequent years (unless modified in 2002 as a result of an appeal or administrative change);

(5) subject to the provisions of paragraph (4) of this court order, the property values certified by the Oversight Board for the 2002 tax year are the property values on which county, municipal, and school district real estate taxes will be computed for the year 2002; and

(6) ordinances providing for the use of 2001 valuations for 2002 would violate state law.

      .1 recognize that the ordinances, which were adopted by a unanimous vote of county council, may be vetoed by the chief executive and, thus, would not become law unless the veto is overridden. This would be a time-consuming process (paragraph 5 of the answer to the petition for special relief states that county council has 30 days in which to override a veto), there is a significant likelihood that the veto will be overridden, and taxing bodies and taxpayers cannot wait. (For example, Pittsburgh property owners have already received tax bills based on the January 8,2002 assessment and have only until February 28,2002, to receive the two percent discount for early payment.) Thus, I am deciding the issue at this time.

      . On December 11, 2001, county council enacted amendments to Chapter 209 of the Administrative Code. Section 209.09 was renumbered as section 209.10 but was substantially unchanged.

      . On December 11, 2001, county council also amended Chapter 205 of the Administrative Code. The amendments are not relevant to this litigation.

      . Under section 205.06(C) of the Administrative Code of Allegheny County, the Oversight Board has the power and duty to “[cjertify, in a timely fashion, that assessments determined by the Office of Property Assessment have been made according to the Assessment Standards and Practices Ordinance. If the Oversight Board is unable to certify the assessments, the last certified assessments and assessments on new and altered property shall remain in effect.”

      . Taxing body appealed properties is defined as the properties which since the most recent assessment were the subject of a successful appeal brought by an applicable county, municipality or school district.

      . See Bert M. Goodman, Assessment Law & Procedure in Pennsylvania, 390-91 (PBI Press 1998 ed.) (“It is a clear conflict of interest for the governmental powers who levy the millage and raise tax revenue to also set the assessments.”)

      . Under an assessment program that provides for county wide reassessments every three years, revisions may be made in any year for any of the reasons described in 72 P.S. §5452.13. Also, administrative changes may be made at any time as provided for in procedures adopted pursuant to section 209.09(F) (as amended, now numbered section 209.10(F)) of the Administrative Code of Allegheny County.

      . The Second Class County Code does not prohibit the use of a base year. See 72 P.S. §5452.la which includes a definition for “base year.”

      . This applies only for year 2002. The 2002 assessment, unless modified in 2002 by an administrative change or an appeal, applies for years 2003-2005. The county shall give adequate notice to the taxpayer.


author: CLARK JR., J.,

text:
    Central Dauphin Education Association v. Central Dauphin School District

      C.P. of Dauphin County,
    no. 5764 equity 2001.

      Thomas W. Scott, for association.

      John P. Krill and David R. Fine, for school district.
    March 30, 2001
   CLARK JR., J.,

The underlying cause of this action was the inability of the Central Dauphin Education Association and the Central Dauphin School District to reach a new negotiated collective bargaining agreement regarding the terms and conditions of employment for the school teachers who make up the association, and who are employed by the school district. The prior agreement covered a four-year period that began on July 1, 1996, and expired on June 30, 2000.

Throughout the past several decades, agreements negotiated between the association and the school district have been guided by the provisions of the Public Employee Relations Act (also commonly referred to as PERA, or Act 195 of 1970), 43 P.S. §1101.101 et seq., and the Public School Code, 24 P.S. §11-1101 et seq. In July of 1992, the Pennsylvania Legislature enacted article XI-A of the Public School Code (commonly referred to as Act 88 of 1992). The Act 88 provisions have, since their passage, been utilized in the collective bargaining negotiations involving teachers and their employing school districts. Act 88 was not, however, intended to completely replace PERA. In fact, the Pennsylvania Legislature stated that PERA “is to be read in pari materia with the addition of article XI-A of the Act, but is repealed insofar as it is clearly inconsistent with the addition of article XI-A of the Act.” (Section 6 of Act 1992, July 9, P.L. 403, no. 88).

In anticipation of the expiration of the 1996-2000 agreement on June 30,2000, and pursuant to these legislative acts, a state mediator appears to have been assigned to assist the parties in their collective bargaining efforts in January 2000. After mediated negotiations failed to produce a new agreement, the dispute was presented to a fact-finder in August 2000. The fact-finder issued a report in September 2000, but its terms were deemed unacceptable by both the association and the school district.

Mediated negotiations continued through the end of January 2001, but a new negotiated agreement was not obtained. Throughout these negotiations, and following the expiration of the 1996-2000 agreement on June 30, 2000, the members of the association continued to work under the terms of that expired agreement. The association commenced a lawful strike on February 1, 2001, which continued through February 21, 2001. The students of the Central Dauphin School District did not attend classes during this time period, inasmuch as the school district cancelled classes during the strike.

As a result of the failed negotiations, and due to the statutes which require that students be provided with 180 days of schooling by June 30 within a school calendar year, the board of school directors of the school district met on February 5,2001, and adopted a resolution which purported to unilaterally impose upon the members of the association the terms and conditions of a new labor contract (imposed agreement). On February 16, 2001, the association filed a complaint in equity and a petition for preliminary injunction which requested that this court enjoin the school district from implementing the terms and conditions of the imposed agreement. Following a hearing on the matters before this court on February 21, 2001, an order was entered which stated:

“(1) That the association members shall return to work on Thursday, February 22, 2001;
“(2) The school district shall provide work to the association members under the same terms and conditions as provided under the collective bargaining agreement which expired on June 30, 2000;
“(3) That the association is hereby ordered to post a bond in the amount of $5,000 before 12 p.m. on February 22,2001, naming the Commonwealth as the obligee and conditioned according to the provisions of Pa.R.C.P., Rule 1531(b)(1).
“(4) Matters concerning any possible unfair practices by the school district are hereby transferred directly to the Pennsylvania Labor Relations Board pursuant to the Pennsylvania Rules of Civil Procedure, for further action and final determination as that board deems appropriate.
“(5) The prothonotary shall certify a photocopy of the docket entries of the above matter and the record to the secretary of the Pennsylvania Labor Relations Board, and upon receipt of said documents, the secretary of the Pennsylvania Labor Relations Board shall consider them to be the equivalent of a regularly filed unfair practices complaint.
“The filing of any appeal of this order shall not act as an automatic stay or supersedeas pursuant to Pa.R.A.R, Rule 1736, without an order from a court of superior jurisdiction.” Order of the Court of Common Pleas, Dauphin County, Pennsylvania, February 21, 2001.

The school district filed an appeal with the Commonwealth Court of Pennsylvania on February 22,2001. This court directed the school district to file a statement of matters complained of on appeal, pursuant to Pa.R.A.P. 1925(b), on February 27,2001. The school district’s statement of matters complained of raised the following issues:

“(1) The court lacked subject matter jurisdiction.
“(2) Petitioners failed to establish the factors requisite for an injunction.
“(3) There is no reasonable basis for the court’s order.
“(4) The court’s finding that a ‘lockout’ had occurred is contrary to the definition of ‘lockout’ in the Public School Code and is in error.
“(5) Petitioners came before the court with ‘unclean hands,’ in that they were threatening defiance of the statutory deadline for ending their strike and the immediacy of harm was created by them.
“(6) The Pennsylvania Labor Relations Board had exclusive jurisdiction over the matters complained of.
“(7) Petitioners had an adequate remedy at law in that they could have pursued their complaint before the Pennsylvania Labor Relations Board.
“(8) Petitioners lacked standing to seek the relief they obtained.
“(9) There was no irreparable harm to petitioners.
“(10) Petitioners had no clear right to relief.
“(11) Transfer of the complaint to the Pennsylvania Labor Relations Board was improper when petitioners did not request such a transfer and when petitioners expressly objected to the jurisdiction of the Pennsylvania Labor Relations Board.
“(12) The court lacked authority to issue its order under Pa.R.A.P. 1925, because it had already issued an opinion.
“(13) The provision of the order protecting itself from automatic supersedeas was in error and ineffective.” Respondents’ statement of matters complained of on appeal, March 14, 2001.

The association filed a brief in reply to respondents’ statement of matters complained of on appeal on March 21, 2001, and also filed a supplemental brief in reply to respondents’ statement of matters complained of on appeal on March 23, 2001.

OVERVIEW OF ACT 88

In order to more fully understand the position of the parties at the time the injunction was issued, the court will briefly discuss the procedures outlined in 24 P.S. §11-1101-A et seq.

24 P.S. §11-1121-A allows the parties to voluntarily submit to mediation at any time. However, this section also requires the parties to submit to mediation if a dispute still exists 126 days prior to the June 30 deadline. The negotiations between the school district and the association failed to produce a new contract and, indeed, a state mediator was assigned on January 13, 2001. Further negotiations and mediation have also failed to produce an agreement, but mediation continues pursuant to 24 P.S. §ll-1122-A(a)(l).

After the mediated negotiations failed to produce a contract, the parties agreed to fact-finding as provided by 24 P.S. §11-1122-A, and the Pennsylvania Labor Relations Board appointed a fact-finder. The fact-finder issued a report on September 22,2000, which was rejected by the parties. Negotiations continued without success, and the association notified the school district of its intention to commence a lawful strike, as defined in 24 P.S. §11-1101-A, on January 29, 2001. The strike began on February 1, 2001, and continued through February 21, 2001. During the strike, on February 5, 2001, the directors met and unilaterally implemented a resolution.

A critical component of this matter is that the school district’s unilateral implementation took place prior to the utilization of arbitration procedures outlined in Act 88. 24 P.S. §11-1123-A provides a form of negotiated final best-offer arbitration where the parties bargain upon the adoption of one of three enumerated impasse procedures. The adoption of an impasse procedure, however, would not require either party to agree to a proposal or make a concession.

24 P.S. § 11-1125-A(a) provides for final best-offer arbitration if both parties agree to submit to such. If a strike or lockout threatens the 180 day school year, however, the parties must submit to mandated final best-offer arbitration. 24 P.S. §ll-1125-A(b).

Although Act 88 clearly provides arbitration procedures for the parties to utilize, these procedures were not yet employed prior to the school district’s imposition of terms and conditions of employment, vis-a-vis, the imposed agreement.

JURISDICTION

The school board first argues that this court lacks subject matter jurisdiction, because it believes the petitioners have submitted a complaint that qualifies more as an unfair labor practice charge, rather than as a suit in equity. In that sense, the school board argues that the Pennsylvania Labor Relations Board has exclusive jurisdiction. See brief in opposition to petition for preliminary injunction, February 21, 2001, p. 7, (citing Hotel & Restaurant Employees International Union Local No. 391-AFL-CIO v. School District Allentown City, 702 A.2d 16, 18 (Pa. Commw. 1997)). This court finds, however, pursuant to the extensive line of cases decided under Mazzie v. Commonwealth, 495 Pa. 128, 432 A.2d 985 (1981), that we were completely within our powers to issue a preliminary injunction in order to maintain the status quo.

In the Mazzie case, the Pennsylvania Supreme Court ultimately upheld a preliminary injunction and affirmed the order of the Commonwealth Court. The union representing the employees filed grievances with the Bureau of Labor Relations in the governor’s office on October 28 and November 3,1980, after the majority of its members were asked to submit statements of financial interest by November 3,1980, pursuant to an executive order issued by Governor Thornburgh. The union believed the executive order unilaterally altered the provisions of employment. The union also filed an unfair labor practice charge with the Pennsylvania Labor Relations Board on November 3, 1980. In the meantime, the union also commenced an action in the Commonwealth Court of Pennsylvania on October 31, 1980 seeking an injunction against enforcement of the executive order. Id. at 132, 432 A.2d at 987.

The Commonwealth Court entered a temporary restraining order on October 31, 1980, and continued the order following a hearing on the union’s motion for a preliminary injunction on November 6,1980. On appeal, the Commonwealth argued that the appellees (union) did not show a clear and immediate right to relief, nor did the appellees show that greater injury would result if the injunction were not granted. The Commonwealth also argued, just as the school district argues in the instant case, that if the statements of financial interest were indeed matters of collective bargaining, then the Pennsylvania Labor Relations Board had “exclusive jurisdiction to consider the charge of unfair labor practice and the courts may not intervene to preserve the status quo pending exhaustion of administrative remedies.” Id. at 133, 432 A.2d at 987-88.

In affirming the Commonwealth Court’s issuance of a preliminary injunction in Mazzie, the Supreme Court of Pennsylvania stated:

“The Commonwealth correctly states that our case law supports the PLRB’s exclusive jurisdiction to determine whether an unfair labor practice has occurred. Hollinger v. Department of Public Welfare, 469 Pa. 358, 365 A.2d 1245 (1976). We have, however, never held that the PLRB has exclusive jurisdiction to seek a status quo injunction pending final determination by it as to whether an unfair labor practice has occurred.” Id. at 140, 432 A. 2d at 991. (emphasis in original)

The approach taken by this court in the instant case follows that holding. This court did not make any final determinations regarding the merits of any possible unfair labor practices, but merely transferred the dispute to the Pennsylvania Labor Relations Board to ultimately decide those issues. An injunction was issued to maintain the status quo until those issues were determined.

This court relied on the principles of Pa.R.C.P. no. 213(f) and, more specifically, the holding of the Commonwealth Court of Pennsylvania in Smith v. Borough of Castle Shannon, 163 Pa. Commw. 531, 641 A.2d 671 (1994), in transferring jurisdiction directly to the Pennsylvania Labor Relations Board. In that case, after grievances were submitted to binding arbitration pursuant to the collective bargaining agreement that existed between the police officers and the Borough of Castle Shannon, the arbitrator ruled in favor of the police officers. When the borough failed to comply with the arbitration awards, the police officers filed a complaint in mandamus with the court of common pleas. Id. at 533-34, 641 A.2d at 672.

The borough argued that mandamus was not a proper remedy, and the court of common pleas sustained the preliminary objections. Id. at 534-35, 641 A.2d at 673. On appeal, the Commonwealth Court vacated the decision of the court of common pleas, transferred the matter to the Pennsylvania Labor Relations Board, and stated, “the PLRB has jurisdiction to determine whether the borough’s alleged failure to comply with the arbitration award is an unfair labor practice.” Id. at 537, 641 A.2d at 674. See also, Borough of Nazareth v. Pennsylvania Labor Relations Board, 534 Pa. 11, 626 A.2d 493 (1993), and Pottstown Police Officers’ Association v. Pennsylvania Labor Relations Board, 160 Pa. Commw. 87, 634 A.2d 711 (1993). Likewise, in the instant matter, this court finds that a direct transfer to the Pennsylvania Labor Relations Board is appropriate for consideration of any possible unfair labor practices.

PRELIMINARY INJUNCTION

The principles surrounding the issuance of a preliminary injunction are well established. In order to succeed, the petitioners have the burden of showing:

“(1) [Tjhat relief is necessary to prevent immediate and irreparable harm which cannot be compensated by damages; (2) that greater injury will occur from refusing the injunction than from granting it; (3) that the injunction will restore the parties to the status quo as it existed immediately before the alleged wrongful conduct; (4) that the alleged wrong is manifest, and the injunction is reasonably suited to abate it; and (5) that the plaintiff’s right to relief is clear.” Lewis v. City of Harrisburg, 158 Pa. Commw. 318, 324, 631 A.2d 807, 810 (1993).

Another source provides:

“In the field of labor relations, injunction is an extraordinary remedy, and the tests applicable to other cases are to be applied. While the issuance of an injunction may be mandatory in exceptional cases, the granting of the remedy ordinarily rests in the discretion of the court, and the court will not entertain an action for injunctive relief where there is an adequate remedy at law. The interference of the court in labor disputes directed either against employer or employees should be exercised sparingly and with caution, especially where fundamental rights of union and employer are involved. So it has been held that in controversies between employers and employees, as in other cases, injunctions are granted only in cases of urgent necessity, to guard against injuries not merely feared but reasonably to be apprehended, and likely to be irreparable.
“An injunction does not issue as punishment for the past; its only legitimate end is protection for the future. The basis of permissible action by the court in labor disputes is the probability of threatened and unjustified interference with the rights of plaintiff. The right to an injunction is to be determined as of the time of the hearing, and an injunction is granted with reference to what there is reason to expect in its absence.” 5 IB CJ.S. Labor Relations §781.

It is readily apparent that injunctive relief was necessary to prevent immediate and irreparable harm which could not be compensated for by damages. The school district unilaterally implemented terms and conditions of employment at a time when the association was conducting a limited lawful strike. Furthermore, these changes preceded the utilization of the arbitration procedures outlined in Act 88.

At a minimum, the actions of unilateral implementation exercised by the school district leave the association in a frustrated negotiating position. Allowing the school district to act in such a way would immediately and irreparably eliminate any leverage that the association could maintain throughout the bargaining process. In short, if this avenue of conduct is available to the school district at this stage of the negotiation process, then any impression of economic leverage in favor of the association at any stage of negotiations is purely illusory.

Keeping this in mind, the school district had to know its actions would provoke an immediate response from the association and create great discord in future bargaining.

If the school district could unilaterally dictate the wages and conditions of employment to the teachers in the first instance, and could thereafter (at any time, and as many times) change, reduce or eliminate wages, benefits or working conditions, what teachers’ union would dare to advance any form of a proposition in collective bargaining that might somehow not be well received by their employer? This would, most likely, only lead to further unilateral changes to the detriment of the union.

Furthermore, this court stated “that the school district, by unilaterally implementing the terms and conditions of employment (imposed agreement) which the association members are apparently expected to accept, has created a constructive, or de facto, lockout.” Memorandum and order, February 21, 2001, pp. 3-4. Act 88 defines lockout as “the cessation of furnishing of work to employees or withholding work from employees for the purpose of inducing, influencing or coercing a change in the conditions or compensation or the rights, privileges or obligations of employment.” 24 P.S. §11-1101-A. The school district argues that a lockout could not have existed because it never refused to furnish work to the teachers. Under this rationale, however, any school district could avoid a potential lockout by merely allowing classes to continue while implementing its own terms and conditions of employment. In this sense, a school district could, in effect, coerce a change of conditions in employment. Therefore, this court concludes, although the school district did not refuse to provide work to the association, it created a de facto lockout by withholding work from the teachers under the terms of the expired collective bargaining agreement, while attempting to coerce the teachers to work under the terms of the imposed agreement.

The second thing that must be shown prior to issuing an injunction is that greater injury will result from refusing the injunction rather than from granting it. The discussion to this point has clearly shown that the abilities of the association to bargain effectively would be seriously hindered, if not crippled, were this court not to issue an injunction.

The third necessity is that the injunction restores the parties to the status quo as it existed prior to the alleged wrongful conduct. The preliminary injunction issued by this court on February 21, 2001 made it clear that the association members were to return to work on February 22, 2001 under the terms and conditions of the collective bargaining agreement that expired on June 30,2000.

Next, the alleged wrong must be manifest, and the injunction must be reasonably suited to abate it. It is evident that the alleged wrong is the school district’s unilateral implementation of terms and conditions of employment. As stated immediately above, this court issued a preliminary injunction which prevented such unilateral implementation, and returned the parties to the status quo.

Finally, this court finds that the rights of the plaintiffs are clear, inasmuch as the school district unilaterally implemented terms and conditions of employment when dispute resolution processes remained under Act 88. The school district argues that the bargaining process reached an impasse, thus allowing it to unilaterally implement the contract provisions while the association was on strike. Impasse is defined by Act 88 as “the failure of an employer and an employee organization to reach an agreement in the course of negotiations.” 24 P.S. §11-1101-A. However, the Commonwealth Court of Pennsylvania stated that the term impasse, when used in public sector law under PERA, “can also mean the end of the statutory dispute resolution process, as well as deadlock.” Philadelphia Housing Authority v. Pennsylvania Labor Relations Board, 153 Pa. Commw. 20, 24, 620 A.2d 594, 596 (1993). The statutory dispute resolution processes provided for in Act 88 were not exhausted prior to the school district’s unilateral implementation of the contract provisions. From this perspective, the plaintiffs had a clear right to obtain a status quo injunction.

This court understands the “either-or” argument presented by the school district. However, although it is clear that impasse may be interpreted to mean either deadlock, or the end of the statutory dispute resolution process, it is important to keep the nature of the dispute in mind.

As noted above, the students are required to receive 180 days of education in a calendar school year. In order to assure that the students of this Commonwealth would be provided with the required 180 days of instruction during a work stoppage by an employee organization, the General Assembly amended the Public School Code by adding provisions regarding collective bargaining. Carroll v. Ringgold Education Association, 168 Pa. Commw. 681, 652 A.2d 417 (1994). Furthermore, the sole purpose of the requirement that schools provide 180 days of instruction per calendar year is to benefit the students of the Commonwealth rather than the teachers. Id. at 687, 652 A.2d at 419.

For the school district to assume that it was capable of unilaterally implementing terms and conditions of employment every time contract talks stalled would be contrary to the basic principles of collective bargaining, and would render the dispute resolution processes developed by the legislature moot. Absent a clear, unequivocal statement in the law by our General Assembly that it was their intention to empower the school district in this fashion, and thereby literally destroy collective bargaining in the school districts throughout this Commonwealth, we are not prepared to ascribe that intention through judicial fiat. If we were to succumb to that enticement, we would effectively flush away over three decades of accumulated labor law in this Commonwealth.

Furthermore, if the school district were simply entitled to unilaterally implement contract provisions when a lawful strike is resorted to, what purpose would a strike serve? The union representing the association, in effect, would become useless, and the school district would have no incentive to settle the dispute. This scenario provides no incentive for the school district to bargain, as it would have the capability of prolonging a dispute, all the while paying the association members at levels that would be below market value.

In Philadelphia Housing Authority v. Pennsylvania Labor Relations Board, 153 Pa. Commw. 20, 620 A.2d 594 (1993), the main issue facing the Commonwealth Court of Pennsylvania was whether an employer could unilaterally implement terms and conditions of employment under PERA, where a statutory impasse was reached, but the employees had not interrupted public services by striking. In holding that the employer could not take unilateral action at such a time, the Commonwealth Court was concerned with the effects this behavior would have on the negotiation process. That court stated that “[Unilateral action by an employer during a period of no contract while employees continue to work serves to polarize the process and would encourage strikes by employees who otherwise may wish to continue working under the terms of the expired agreement while negotiations continue.” Id. at 32, 620 A.2d at 600.

Granted, the facts surrounding the instant case are significantly different. First, legislatively speaking, Act 88 must now be considered regarding the collective bargaining process. Second, in the instant scenario, the association was on strike when the school district unilaterally imposed the terms and conditions of employment.

In support of its reasoning in Philadelphia Housing Authority, supra, the Commonwealth Court said:

“We believe that a public employer is less likely to negotiate in good faith with a sincere desire to reach mutual agreement if it knows that it may implement its final offer after only 21 days of negotiation and 20 days of mediation.. .. Good faith negotiation would be seriously jeopardized by permitting the employer to implement its bargaining position after a few face-to-face bargaining sessions and the requisite number of mediation sessions with the mediator. The employer’s unilateral achievement of its bargaining position effectively relieves pressure on it to arrive at a mutually agreed resolution of the bargaining impasse. It is the tension created by the need to find common ground between the parties which is at the core of the process. Relieving that tension greatly removes the incentive of a party to bargain with a sincere desire to reach agreement.” Id. at 32-33, 620 A.2d at 600.

It seems clear that the Commonwealth Court was concerned with the exhaustion of procedures under PERA, and because the employees chose to continue working under the terms of the expired agreement, the court felt that unilateral action by the employer at that time would have been improper. Likewise, this court must consider whether all of the collective bargaining procedures under Act 88 have been exhausted. As noted above, statutory arbitration processes remain, and allowing unilateral action by the school district at this time would, much like in Philadelphia Housing Authority, provide the employer with less desire to reach a mutual agreement.

This court is unwilling to overlook the intentions of the Pennsylvania General Assembly in its enactment of Act 88. Moreover, this court will not condone actions by a party that refuses to recognize the provisions of Act 88. We refuse to believe that the General Assembly intended to give an employer the ability to unilaterally implement terms and conditions of employment when the employees enter into a very limited strike that has been declared lawful by the very same General Assembly. It would likewise be contrary to logic to believe that the General Assembly included arbitration procedures within Act 88 without the intention that parties utilize those procedures prior to any consideration of unilateral implementation.

Despite this court’s inability to ultimately determine whether unfair labor practices have occurred, this court believes it is appropriate to discuss the likelihood that such practices may be found in order to further justify the issuance of the preliminary injunction. This court, therefore, will discuss some other cases that present similar circumstances.

For instance, in Morrisville School District v. Pennsylvania Labor Relations Board, 687 A.2d 5 (Pa. Commw. 1996), the Commonwealth Court affirmed the order of the Court of Common Pleas of Bucks County, which had affirmed the decision of the PLRB that there was a failure to bargain in good faith on the part of the employer. In that case, the Commonwealth Court found that the employer refused to continue bargaining although the union continued to negotiate. Id. at 9. The Commonwealth Court noted that the “employer has the obligation to bargain in good faith to a bona fide impasse____” Id. at 8. Rather than follow this obligation, however, the employer chose to unilaterally declare that an impasse existed, despite the union’s willingness to hold more bargaining sessions.

Likewise, it is difficult for this court to conclude that the parties reached an impasse in the instant case. The parties did not utilize arbitration procedures set forth in Act 88, yet the school district unilaterally determined that an impasse or deadlock existed which allowed it to impose terms and conditions on the association after it commenced a lawful strike.

In Upper Moreland Township District v. Pennsylvania Labor Relations Board, 695 A.2d 904 (Pa. Commw. 1997), the Commonwealth Court again affirmed the order issued by the Court of Common Pleas of Montgomery County, which affirmed the PLRB’s order that determined the employer failed to bargain in good faith. In discussing the employer’s failure to bargain in good faith, the Commonwealth Court stated:

“The parties must set forth a position upon which the adversary may rely that the acceptance of which would result in a tentative agreement. At a minimum, each party must present an identifiable target for the adversary to shoot at which will result in at least a tentative agreement, if reached.” Id. at 909.

In that regard, the school district never presented the association with an identifiable target prior to the school district’s implementation of the imposed agreement. Much like the employer’s actions in Upper Moreland, the school district’s unilateral implementation only widened the gap in the negotiations with the association.

Although the determination of any unfair labor practice will be made by the PLRB, these cases provide this court with an intricate look into the review process exercised by the Commonwealth Court. In that sense, the prior decisions of the Commonwealth Court allow this court to anticipate the validity of any unfair labor practice claims. This, in turn, provides lower courts with more justification for issuing status quo injunctions in cases where similar actions have been adjudicated as unfair labor practices, inasmuch as it helps the lower courts determine whether the petitioner for a preliminary injunction has a clear right to such relief.

OTHER ARGUMENTS

The school district also argues that the association came before this court with “unclean hands” because the association considered continuing the work stoppage if the teachers were forced to work under the terms of the imposed agreement. This court finds that argument unpersuasive.

It must be noted that this was simply a consideration made by the association, and the preliminary injunction issued by this court eliminated the need on behalf of the association to take such action. Such speculation does not justify a conclusion that the association came before this court with “unclean hands.”

The school district questions the standing of the association in this action. The Commonwealth Court of Pennsylvania, in Harrisburg School District v. Hickok, 762 A.2d 398, 404 (Pa. Commw. 2000) (citing Defazio v. Civil Service Commission of Allegheny County, 526 Pa. 431, 756 A.2d 1103 (2000)), stated:

“The test for standing is that ‘one who seeks to challenge governmental action must show a direct and substantial interest [and] a sufficiently close causal connection between the challenged action and the asserted injury to qualify the interest as “immediate” rather than remote.’ Allegheny County v. Monzo, 509 Pa. 26, [33-35,] 500 A.2d 1096, 1100 (1995) (citing William Penn Parking Garage Inc. v. City of Pittsburgh, 464 Pa. 168, 346 A.2d 269 (1975)). We further explained that a substantial interest requires ‘some discernible adverse effect to some interest other than the abstract interest of all citizens in having others comply with the law____[D]irect simply means that the person claiming to be aggrieved must show causation of the harm to his interest by [the government’s actions].’ Monzo at [34,500 A.2d at] 1100. The immediacy or remoteness of the injury is determined by the ‘nature of the causal connection between the action complained of and the injury to the person challenging it.’ ” Id.

Although, as stated above, the requirement that students receive 180 days of education is intended to benefit the students, the provisions of Act 88 cannot be ignored in relation to the various school districts and unions representing the teachers. Those provisions deal specifically with the collective bargaining between the school districts and the unions. Inasmuch as some of those provisions address strikes and lockouts, it is difficult to conclude that unions and school districts lack standing to challenge actions taken by one of the parties. We have already described how the unilateral implementation of terms and conditions would have adversely affected the bargaining position of the association. Furthermore, there can be no argument that the association members would have been directly affected by the changes within the imposed agreement, and the injuries suffered by the association would have been immediate, in that the teachers would have been forced to work under the new terms and conditions when they returned to work on February 22, 2001.

The school district also claims that this court lacked the authority to issue its order of February 27, 2001, which ordered the school district to file a statement of matters complained of on appeal pursuant to Pa.R.A.P. 1925, stating this court already issued an opinion via its memorandum and order of February 21, 2001.

We first note that several issues were raised during the hearing before this court on February 21,2001, some of which were not contemplated by the parties prior to the hearing. This court is also aware of the statewide implications this case could have on the conduct of employer/teacher collective bargaining. Keeping these considerations in mind, along with the time constraints that were placed on the parties and the court, the issuance of the order directing the school district to file a statement of matters complained of on appeal merely afforded an opportunity to crystallize the issues that would be considered on appeal before the Commonwealth Court.

The last issue raised by the school district is that this court erred when it stated in the February 21,2001 memorandum and order that an appeal would not act as an automatic stay or supersedeas pursuant to Pa.R.A.P. 1736. This court believes it has the authority to modify the terms of any supersedeas under the language of Pa.R.A.P. 1732(a). This court was well aware that an appeal from the issuance of a preliminary injunction was a certainty. Armed with this knowledge, this court was forced to vacate the automatic supersedeas provided for in Pa.R.A.P. 1736(b). Otherwise, the filing of the appeal by the school district would have operated as an automatic stay of this court’s February 21, 2001 order, and the issuance of the preliminary injunction would have become moot.

In light of the case law and statutes reviewed, this court finds that its exercise of jurisdiction was proper. Therefore, having found that all of the prerequisites to the issuance of a preliminary injunction have been satisfied, such issuance on February 21,2001, enjoining the school district from unilaterally implementing the imposed agreement, was justified. This court also finds that it was within its authority to transfer this matter to the PLRB for a determination of whether any unfair labor practices occurred.

      . In this court’s memorandum and order of February 21,2001, this date was listed as June 15, which would be the appropriate date if both of the parties to a collective bargaining agreement agreed to submit to final best-offer arbitration. (See 24 P.S. §11-1125-A.) The 180 days of instruction required by 24 P.S. §15-1501 must be completed, regardless of the circumstances, no later than June 30 under the provisions of Act 88. Should this deadline become threatened, the secretary of education is authorized to initiate injunctive proceedings in the appropriate county court of common pleas. 24 P.S. §11-1161-A.

      . As a general matter, some of the altered terms and conditions of employment included: (1) reductions in the health insurance plans made available to the association members; (2) increases in the cost of health insurance coverage, including co-payments to be made by the teachers; (3) elimination of unpaid leaves of absence, (4) restrictions on professional development, and (5) wage adjustments that would hinder the progress of the teachers on the salary scale. See petitioners’ complaint in equity, February 16, 2001, ¶41, and respondents’ brief in opposition to petition for preliminary injunction, February 21, 2001, pp. 4-6.

      . The supplemental brief filed by the association touched on an issue that was not raised by the school district in its appeal. Therefore, this court will not address that issue herein.

      . This “strike” is not of the usual unlimited variety of labor job action, but, rather is a very narrowly drawn and precisely limited cessation of work which is statutorily permitted to occur during the midst of the statutorily permitted process set forth in Act 88, and is specifically limited in length. After any such limited initial strike periods the employees are required to return to work and the remainder of the Act 88 processes then are implemented, including mandatory arbitration.

      . The Supreme Court of Pennsylvania also noted that “preliminary injunctions are preventive in nature and are designed to maintain the status quo until the rights of the parties are finally determined. There is, however, a distinction between mandatory injunctions, which command the performance of some positive act to preserve the status quo, and prohibitory injunctions, which enjoin the doing of an act that will change the status quo. This court has engaged in greater scrutiny of mandatory injunctions and has often stated that they should be issued more sparingly than injunctions that are merely prohibitory.” Mazzie v. Commonwealth, 495 Pa. 128, 134, 432 A.2d 985, 988 (1981). There is no doubt that the preliminary injunction issued by this court on February 21,2001 was aprohibitory injunction, inasmuch as it was issued to prohibit the school district from unilaterally implementing terms and conditions of employment in order to maintain the status quo.

      . Pa.R.C.P. no. 213(f) states:
      “(f) When an action is commenced in a court which has no jurisdiction over the subject matter of the action it shall not be dismissed if there is another court of appropriate jurisdiction within the Commonwealth in which the action could originally have been brought but the court shall transfer the action at the cost of the plaintiff to the court of appropriate jurisdiction. It shall be the duty of the prothonotary or clerk of the court in which the action is commenced to transfer the record together with a certified copy of the docket entries to the prothonotary or clerk of the court to which the action is transferred.”

      . This position taken by the court, or any other position within this opinion, is not intended to infer that the school district has, in fact, committed an unfair labor practice. This determination, as discussed previously, is within the exclusive jurisdiction of the PLRB.

      . See Pennsylvania Labor Relations Board v. Williamsport Area School District, 486 Pa. 375, 381, 406 A.2d 329, 332 (1979). In that case, the Supreme Court of Pennsylvania, relying on Appeal of Cumberland Valley School District, 483 Pa. 134, 143, 394 A.2d 946, 951 (1978), stated that “[t]he coercive effect of the unilateral [changes] is obvious. The bargaining authority of the [association] to freely bargain is seriously undermined.”

      .24 P.S. §11-1132-A(2) provides that lockouts are prohibited during final best-offer arbitration. As discussed above, Act 88 provides for final best-offer arbitration. The Pennsylvania Supreme Court has held that the violation of a statute constitutes immediate and irreparable harm, and the issuance of a preliminary injunction to avoid such a violation is justified. Public Utility Commission v. Israel, 356 Pa. 400, 406, 52 A.2d 317, 321 (1947). Inasmuch as this court held that a de facto lockout existed, the preliminary injunction was justified to avoid any possible violation of 24 P.S. §11-1132-A(2).

      . In Upper Moreland, the employer eventually subcontracted away the union’s work. During the negotiations, the employer first notified the union that it would have to compete with a subcontractor’s bid that would save the employer in excess of $100,000. The employer later notified the union that this figure increased to nearly $300,000, without indicating to the union that the employer would accept such a proposal if the union could match it. The Commonwealth Court stated that “[i]t is not a fair practice to refuse to define the terms the employer will accept in a settlement before contracting away the bargaining unit’s work.” Upper Moreland Township District v. Pennsylvania Labor Relations Board, 695 A.2d 904, 909 (Pa. Commw. 1997).