Opinions of the United
2003 Decisions                                                                                                             States Court of Appeals
                                                                                                                              for the Third Circuit


4-29-2003

Mannarino v. Morgan
Precedential or Non-Precedential: Non-Precedential

Docket 02-2237




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Recommended Citation
"Mannarino v. Morgan" (2003). 2003 Decisions. Paper 609.
http://digitalcommons.law.villanova.edu/thirdcircuit_2003/609


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                                                       NOT PRECEDENTIAL

                UNITED STATES COURT OF APPEALS
                       FOR THE THIRD CIRCUIT
                               ___________


                               No. 02-2237
                               ___________


 JULIA MANNARINO and RON TESKA d/b/a SOUTHWESTERN COM MUNITY
                               VENTURES


                                     v.


MORGAN TOWNSHIP, SHIRL BARNHART, UNITED STATES DEPARTMENT OF
     HOUSING AND URBAN DEVELOPMENT and ANDREW CUOMO


          MORGAN TOWNSHIP, SHIRL BARNHART, Appellants
                               ___________


              On Appeal from the United States District Court
                  for the Western District of Pennsylvania
                        (Civil Action No. 99-2058)
             District Judge: The Honorable Robert C. Mitchell
                               ___________


            Submitted Pursuant to Third Circuit L.A.R. 34.1(a)
                              March 6, 2003


           Before: ROTH, BARRY and FUENTES, Circuit Judges


                     (Opinion Filed: April 29, 2003)
                       ________________________


                       OPINION OF THE COURT
                               ________________________

FUENTES, Circuit Judge

       Defendants Morgan Township and Shirl Barnhart appeal the judgment entered against

them and in favor of plaintiffs Julia Mannarino and Ron Teska d/b/a Southwestern

Community Ventures on plaintiffs’ 42 U.S.C. § 1983 claims. Because we discern no error

in the findings of fact and conclusions of law entered by the District Court, we will affirm.

                            Facts and Procedural Background

       The factual allegations underlying this case are well known to the parties, and

therefore, they are not detailed here, except to the extent that they directly bear upon the

analysis. On December 20, 1999, plaintiffs Julia Mannarino and Ron Teska, husband and

wife doing business as Southwestern Community Ventures, brought suit against defendants

Morgan Township, a Pennsylvania municipality, Shirl Barnhart, Chairman of the Morgan

Township Board of Supervisors, the United States Department of Housing and Urban

Development (“HUD”), and Andrew Cuomo, Secretary of HUD, alleging that their rights

under Section 3 of the Housing and Urban Development Act of 1968, as amended, 12 U.S.C.

§ 1701u, were violated by the manner in which Morgan Township had awarded a contract

to provide administrative services for housing rehabilitation. Thereafter, defendants HUD

and Andrew Cuomo were dismissed from the action. The parties consented to trial before

United States Magistrate Judge Robert C. Mitchell.

       After holding a pretrial conference, the Court identified, in the Pretrial Order, the



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contentions of the parties and the issues to be resolved as follows:

              Plaintiffs’ Contentions: Count II remains against Morgan
              Township and Shirl Barnhart: § 1983 action alleging defendant
              failed to give proper consideration under the HUD Act.

              Defendants’ Contentions: Plaintiffs are not residents of Morgan
              Township and therefore HUD is inapplicable to them.

              Issue to be Resolved: In determination of award contract did
              defendants give proper consideration to plaintiffs?

App. at 29. Following a bench trial, the Court ruled that plaintiffs’ action was timely filed

and that defendants failed to comply with Section 3 of the Housing and Urban Development

Act, which requires that, to the greatest extent feasible, opportunities for training and

employment be given to business concerns that provide economic opportunities to low and

very low income persons residing in the non-metropolitan county in which the assistance is

expended. The Court held that plaintiffs, who are residents of the non-metropolitan county,

are members of the class intended to benefit by Section 3 of the Act, while Community

Preservation, to whom the contract was awarded, was not and that plaintiffs were qualified

to be awarded the contract. The Court concluded that plaintiffs were entitled to $16,225 for

loss of income and thereafter entered a judgment awarding plaintiffs these damages, together

with costs. Defendants timely appealed.

                        II. Jurisdiction and Standard of Review

       The District Court exercised jurisdiction over this matter under 28 U.S.C. § 1331. We

have appellate jurisdiction under 28 U.S.C. § 1291.



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       We accept the trial court’s findings of historical or narrative facts unless clearly

erroneous and exercise plenary review of the court’s interpretation of legal precepts and its

application of those precepts to the historical facts. See Mellon Bank, N.A. v. Metro

Communications, Inc., 

(3d Cir. 1991) (citing Universal Minerals, Inc. v. C.A.

Hughes & Co., 

, 101-02 (3d Cir. 1981)).

                                       III. Discussion

       Defendants assert on appeal that plaintiffs’ § 1983 claims are barred by the applicable

two year statute of limitations; that they satisfied the Section 3 requirements by informing

plaintiffs of the potential contracting opportunities and awarding them points in the

evaluation process for being a Section 3 business; that, in any event, plaintiffs’ business was

not a qualifying Section 3 business because plaintiffs do not reside in Morgan Township; and

finally, that the Court erred in finding personal liability against defendant Shirl Barnhart

because no evidence was presented that would support the imposition of personal liability

upon a township supervisor acting in his official capacity.

       In response, plaintiffs explain that they do not claim that Barnhart is personally liable

for the judgment below and note that their original and amended complaint named Barnhart

only in his capacity as Chairman of the Board of Supervisors for Morgan Township. With

respect to the statute of limitations argument, plaintiffs counter that defendants did not raise

the statute of limitations defense based on the December 11 or 12, 1997 notice date until their

closing arguments at trial. Moreover, the statute of limitations defense, though pleaded in



                                              -4-
the answer, was not included in the Pretrial Order.

       As we have previously observed, “[t]he finality of the pretrial order contributes

substantially to the orderly and efficient trial of a case.” Petree v. Victor Fluid Power, Inc.,

, 1194 (3d Cir. 1987). Because the statute of limitations argument was not

identified in the Pretrial Order, plaintiffs did not have a meaningful opportunity to address

its merits at trial. We therefore agree with plaintiffs that allowing defendants to raise the

defense on appeal would constitute unfair prejudice and, accordingly, we affirm the District

Court on this issue.

       Defendants next argue that plaintiffs were not entitled to a preference as a Section 3

business concern because they are not residents of Morgan Township. Defendants argue, in

the alternative that, under the Interim Rules in effect at the time of the awarding of the

contract, they were only required to seek out qualified Section 3 businesses to inform them

of the potential contracting opportunity. Defendants assert that they solicited Mannarino to

participate in the request for proposals and that they awarded her points in the evaluation

process for being a Section 3 business.

       Plaintiffs correctly assert that Southwestern Community Ventures is entitled to

preference under Section 3 because the individual plaintiffs by whom it is wholly owned are

very low income individuals residing in Greene County, the nonmetropolitan county in which

the covered assistance was expended.

       Section 3 provides:



                                              -5-
              In providing housing and community development assistance
              pursuant to other programs . . . to the greatest extent feasible,
              and consistent with existing Federal, State, and local laws and
              regulations, contracts awarded for work to be performed in
              connection with a housing rehabilitation (including reduction
              and abatement of lead-based paint hazards), housing
              construction, or other public construction project are [to be]
              given to business concerns that provide economic opportunities
              for low- and very low- income persons residing within the
              metropolitan area (or nonmetropolitan county) in which the
              assistance is expended.

12 U.S.C. § 1701u(d)(2)(A) (emphasis added). As to the issue of compliance with Section

3, plaintiffs counter that informing Section 3 businesses of opportunities is but one of the

many actions that must be carried out to satisfy the “greatest extent feasible” statutory

requirement and, standing alone, is insufficient. The appendix to the HUD’s Interim Rules,

which were in effect when the contract at issue was awarded provides 22 “Examples of

Efforts to Award Contracts to Section 3 Business Concerns.” Economic Opportunities for

Low and Very Low Income Persons; Interim and Final Rules, 59 Fed. Reg. 33865, 33889

(1994). Providing notice of contracting opportunities is one of the many examples set forth

in the appendix. Defendants offer no basis however for concluding that, either standing

alone or coupled with the award of points given to plaintiffs to reflect Section 3 business

status, their selection process necessarily satisfied the “greatest extent feasible” statutory

requirement. We therefore affirm the District Court.

                                      IV. Conclusion

       After carefully considering the arguments discussed above and all other arguments


                                             -6-
advanced by appellants in support of their assertion that the District Court erred in awarding

damages to appellees on their § 1983 claims, we affirm the District Court’s judgment.




_____________________________

TO THE CLERK OF THE COURT:




Kindly file the foregoing Opinion.

                                                         By the Court,




                                                           /s/Julio M. Fuentes

                                                         Circuit Judge




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