Indemnification under the Political Subdivision Tort Claims Act; Collateral Estoppel
McGuire v. City of Pittsburgh, 250 A.3d 516 (Pa. Cmwlth. 2021), allocatur granted Nov. 16, 2021, appeal docket 26 WAP 2021
Colby Neidig, an off-duty officer, allegedly chased and then beat up McGuire, a teenager who was smashing pumpkins and ringing the doorbell at Neidig’s home. Neidig did not disclose that he was a police officer until asking a neighbor to call the police.
McGuire filed a federal suit against Neidig in his individual capacity as a police officer, asserting counts of, inter alia, use of excessive force in violation of 42 U.S.C. § 1983. The City participated in the officer’s defense and did not assert that the officer’s use of force was “outrageous” or rose to the level of willful misconduct. The federal jury concluded that Neidig acted under color of state law when he injured McGuire and a judgment was entered in McGuire’s favor and against Neidig. Thereafter, Neidig assigned to McGuire his right to indemnity under the Political Subdivision Tort Claims Act, which provides in pertinent part that a “local agency shall indemnify the employee for the payment of any judgment’ in an action for injury to person or property brought against an employee where the employee was acting within the scope of his duties.” 42 Pa.C.S. § 8548(a)(emphasis added). McGuire then filed the instant action in the Allegheny County Court of Common Pleas (trial court) seeking a declaratory judgment that the Tort Claims Act required the City to indemnify Neidig following the federal district court’s award. McGuire filed a motion for summary judgment arguing that the federal jury finding that Neidig was acting under color of state law at the time he assaulted McGuire obligated the City to pay the award. In support, McGuire pointed to Tepper v. City of Philadelphia Board of Pensions and Retirement, 163 A.3d 475 (Pa. Cmwlth. 2017) in which the court treated the terms under color of state law and scope of employment under the state retirement law as the same.
The trial court disagreed that the federal court determination that Neidig injured McGuire while acting under color of state law was a judicial determination equivalent to a finding that Neidig acted within the scope of his employment for purposes of indemnification. The trial court jury ultimately found in the City’s favor and against McGuire on the basis that Neidig had not acted within the scope of his duties when he struck McGuire. In its memorandum opinion, the trial court distinguished Tepper, explaining:
In Tepper, the jury accepted that Tepper exited his home, flashed his badge, and identified himself as a police officer.
After hearing those facts, the jury found that Tepper acted ‘under color of state law,’ in his official capacity as a police officer, under the definitions of that term and the guidelines set forth in the federal jury charge. The facts presented in this case are quite distinguishable; there was never the display of a badge or the announcement as a police officer, or any other indication that Neidig was a ‘state actor.’ This Court finds these facts critical and determinative to the jury’s finding and any comparison with Tepper [is] misplaced.
Slip op. at 19, quoting Trial Ct. Op. at 12-13 (citations omitted, emphasis in original). Additionally, the trial court explained its refusal to find “under color of state law” is synonymous with “acting within the scope of his employment,” reasoning that:
This writer is unwilling to accept the issue decided in the prior case as identical to the one presented in the instant. This [trial c]ourt does not find that ‘under color of state law’ is synonymous with ‘acting within the scope of his employment[.’] This [trial c]ourt crafts jury instructions dozens of times throughout the course of every year; there has never been a time that legal counsel so freely offered to deem words or terms as synonymous or interchangeable. This [trial c]ourt routinely argues over the placement of commas, the placement of each particular instruction; and often in negligence actions where liability is admitted, the inclusion of the definition of the term negligence. It is contrary to all of this [trial c]ourt’s training and experience to patently ignore the clear language of the statutes and precedential holdings spanning nearly 100 years of jurisprudence. It is also contrary to reason and law to apply the ‘close enough’ rationale that McGuire now asserts.
Slip op. at 20, quoting Trial Ct. Op. at 15. McGuire appealed to Commonwealth Court, arguing that the City was collaterally estopped as a result of the federal court determination that Neidig injured McGuire while acting under color of state law, which McGuire contended was a judicial determination equivalent to a finding that Neidig acted within the scope of his employment for purposes of indemnification. McGuire further argued that that Section 8548 of the Tort Claims Act provides for the indemnification for any judgment rendered against an employee while acting within the scope of his employment. In support, McGuire argued his case comparable to Wiehagen v. Borough of N. Braddock, 594 A.2d 303 (Pa. 1991), in which the Pennsylvania Supreme Court ordered a municipality must indemnify a police officer for damages awarded in a federal action for violation of Section 1983, “because there is a judgment against [the police officer] arising from conduct within the scope of his employment[.]” Slip op. at n.10, quoting Wiehagen, 594 A.2d at 306.
Commonwealth Court agreed with the trial court that Tepper was factually distinguishable from McGuire’s case, and distinguished Wiehagen, reasoning that the Supreme Court required indemnification there “because, unlike in the instant matter, the parties had explicitly stipulated in the federal court action that the police officer was acting within the scope of his duties when he struck the plaintiff.” Slip op. at n.10. Commonwealth Court acknowledged that “Pennsylvania courts have not explicitly ruled on the interplay between the terms under color of state law and within the scope of employment in the context of indemnification under the Tort Claims Act.” Slip op. at 20. However, the court reasoned that “in the context of federal jurisprudence, the determination in the instant Federal Court Action that Neidig acted under color of law does not dictate that Neidig acted within the scope of his employment,” finding it “persuasive” that:
…federal courts have specifically held that a “determination that [a police officer] acted ‘within the scope of his office or employment’ does not inevitably flow from a concession that he acted ‘under color of’ Pennsylvania law.” Zion v. Nassan, 283 F.R.D. 247, 267-68 (W.D. Pa. 2012), aff’d, 556 F. App’x 103 (3d Cir. 2014). “The actions of a state official may ‘constitute state action …’ even when they exceed the limits of the official’s authority.” Id. at 267. The Zion Court noted that “[t]he Pennsylvania courts have recognized that ‘an assault committed by an employee upon another person for personal reasons or in an outrageous manner is not actuated by an intent to perform the business of the employer and, as such, is not within the scope of employment.’ ” Id. at 267 (bold emphasis added; italic emphasis omitted) (quoting Costa v. Roxborough Mem’l Hosp., 708 A.2d 490, 493 (Pa. Super. 1998)).
Slip op. at 21. Having concluded that McGuire did not meet the first collateral estoppel requirement, the court declined to address the remaining criteria except to note that “McGuire did not demonstrate that it was necessary to the federal court’s ruling that it make a finding that Neidig acted within the scope of his employment to determine that Neidig was liable under Section 1983.” Slip op. at n. 11.
The Supreme Court granted allocatur to consider the following issues:
(1) Is a federal jury’s finding that a police officer acted “under color of state law” a “judicial determination” that the officer acted within the “scope of his office or duties” for purposes of indemnification where the defense that the officer acted as a private citizen was rejected by the jury’s verdict and where the municipality participated in the officer’s defense and did not assert that the officer’s use of force was “outrageous” or rose to the level of willful misconduct?
(2) Must the criteria for indemnification under the [Political Subdivision Tort Claims Act, 42 Pa.C.S. §§ 8541-8542,] be judicially determined in the damages action brought against the employee?
(3) In a declaratory judgment action brought by an employee, is the issue of whether the criteria for indemnification under the [Political Subdivision Tort Claims Act] were “judicially determined” in the underlying action for damages a question of law for the court to decide?