Justia Real Estate & Property Law Opinion Summaries

In consolidated appeals, the issue presented for the Pennsylvania Supreme Court's review centered on the Commonwealth Court’s holding that, to be held liable for damages under Pennsylvania’s inverse condemnation statute, an entity had to be "clothed with the power of eminent domain" to the property at issue. In 2009, Appellee, UGI Storage Company filed an application with the Federal Energy Regulatory Commission (the “Commission” or “FERC”), seeking a certificate of public convenience and necessity to enable it to acquire and operate certain natural gas facilities. Appellee wished to acquire and operate underground natural gas storage facilities, which the company referred to as the Meeker storage field. Appellee also sought to include within the certificated facilities a 2,980-acre proposed "buffer zone." FERC ultimately granted the application for Appellee to acquire and assume the operation of the Meeker storage field, but denied Appellee’s request to certificate the buffer zone. Appellants petitioned for the appointment of a board of viewers to assess damages for an alleged de facto condemnation of their property, alleging that though their properties had been excluded by FERC from the certificated buffer zone, they interpreted Appellee’s response to the Commission’s order as signaling its intention to apply for additional certifications to obtain property rights relative to the entire buffer zone. The common pleas court initially found that a de facto taking had occurred and appointed a board of viewers to assess damages. Appellee lodged preliminary objections asserting Appellants’ petition was insufficient to support a de facto taking claim. The Supreme Court reversed the Commonwealth Court: "we do not presently discern a constitutional requirement that a quasi-public entity alleged to have invoked governmental power to deprive landowners of the use and enjoyment of their property for a public purpose must be invested with a power of eminent domain in order to be held to account for a de facto condemnation. ... a public or quasi-public entity need not possess a property-specific power of eminent domain in order to implicate inverse condemnation principles." The case was remanded for the Commonwealth Court to address Appellants’ challenge to the common pleas court’s alternative disposition (based upon the landowners’ purported off-the-record waiver of any entitlement to an evidentiary hearing), which had been obviated by the intermediate court’s initial remand decision and that court’s ensuing affirmance of the re-dismissal of Appellants’ petitions. View "Albrecht, et al. v. UGI Storage Co. et al." on Justia Law

In 2015, Pittsburgh City Council passed Ordinance 2015-2062. The Ordinance supplemented Section 659.03 of the Pittsburgh Code of Ordinances, which already barred various forms of discrimination in housing. In early 2016, the Apartment Association of Metropolitan Pittsburgh (“the Association”), a nonprofit corporation comprising over 200 residential property owners, managers, and landlords, filed in the Allegheny County Court of Common Pleas a Complaint for Equitable Relief and Request for Declaratory Judgment against the City, alleging that the Nondiscrimination Ordinance violated the Home Rule Charter ("HRC") and the Pennsylvania Constitution. The Association also sought a temporary stay of enforcement of the Ordinance, which the court granted. The parties submitted Stipulations of Fact and submitted the case for judgment on the pleadings (the City) or summary judgment (the Association). The trial court heard argument, and ultimately ruled in favor of the Association, declaring the Ordinance invalid. The Pennsylvania Supreme Court held that the HRC’s Business Exclusion precluded the Pittsburgh ordinance that proscribed source-of-income discrimination in various housing-related contexts. Accordingly, the Court affirmed the Commonwealth Court’s entry of judgment in favor of Apartment Association. View "Apt. Assoc. of Metro Pittsburgh v. City of Pittsburgh" on Justia Law

Appellants William "Billy" King, and Melanie (Frantz) King ("the Kings"), hired appellee Terra Firma Builders, LLC ("TF") to perform construction work in the backyard of their home. In December 2012, TF was removed from the project before completion due to a dispute about the work performed up to that point. In 2013, TF filed two lawsuits for breach of contract and unjust enrichment, a mechanics’ lien claim for alleged unpaid labor and materials. TF effectuated service of the mechanics’ lien on the Kings by sheriff, however a month later, TF withdrew the lien and filed a new one for the same amount of the discontinued lien; this lien was assigned a new docket number. TF did not file the required affidavit of service for this lien claim. The Kings answered the suit with their own counterclaim alleging breach of contract; they did not challenge TF’s failure to file an affidavit of service at this time. In 2015, TF sought to enforce and obtain judgment on its lien. The Kings did not file preliminary objections or otherwise raise TF’s failure to file an affidavit of service at this time. In 2017, the trial court consolidated TF’s mechanics’ lien and breach of contract actions and proceeded to a bench trial. The parties agreed that TF failed to complete the project but disputed the amount of work remaining unfinished and the quality of the work completed. The court ultimately found in favor of the Kings on all claims, including the Kings’ counterclaim, and awarded the Kings monetary damages. TF moved for a new trial, which was ultimately granted. At the conclusion of the second trial, the court again found in favor of the Kings on the merits, but did not award damages. In 2018, while the post-trial motions were pending, the Kings moved to strike the mechanics’ lien because TF’ failed to file an affidavit of service to perfect the lien. TF argued the Kings had waived their right to object to the lien when they accepted service of the complaint to enforce, never filed preliminary objections, and appeared in court to defend the action. The trial court granted the petition to strike. On appeal, a divided three-judge panel of the Superior Court reversed. The Pennsylvania Supreme Court reversed, finding the lien remained unperfected and invalid, "and the applicable statutes quite logically do not specify a time limit for objection to such a thing." View "Terra Firma Builders, LLC v. King, et al.." on Justia Law

Eleanor McLaughlin acquired all oil, gas, and mineral rights underlying two parcels in Watson Township, Warren County, Pennsylvania. In 1985, she leased the oil and gas rights for each parcel to United Land Services. United Land Services in turn assigned the leases to Appellant Mitch-Well Energy, Inc. In 2008, Jack and Zureya McLaughlin sold their interest in the Warrant 3010 to Sheffield Land and Timber Company, which merged into Appellee SLT Holdings, LLC in 2012. During the initial term of the leases, Mitch-Well drilled one well on each lease parcel and produced oil in paying quantities until 1996. Mitch-Well did not drill any additional wells. After 1996, no oil was produced or royalty payments, or delay rental payments made or tendered until 2013. Nor did Mitch-Well tender any minimum payments during that period under either lease. The Pennsylvania Supreme Court granted review to consider the propriety of the Superior Court’s affirmance of the trial court’s grant of partial summary judgment in favor of Appellees in their complaint in equity against Appellant on the grounds of abandonment. Because Appellees had available to them a full and adequate remedy at law, through contract principles generally applicable to oil and gas leases, and through the specific provisions of the subject leases, the Supreme Court concluded it was error to provide recourse through application of the equitable doctrine of abandonment. View "SLT Holdings v. Mitch-Well Energy" on Justia Law

Two taxing districts undertook parallel challenges to a property’s partial tax exemption. Appellee Huston Properties, Inc. (“Taxpayer”), owned the subject property (the “Property”). In 2013, Taxpayer, claiming to be a charitable institution, sought tax-exempt status for the Property for the 2014 tax year. After a hearing, the Chester County Board of Assessment Appeals granted a partial exemption, reasoning that that portion of the Property was used for charitable purposes. The City of Coatesville appealed that decision to the Court of Common Pleas. Six days later, the Coatesville Area School District, another taxing authority encompassing the Property, lodged its own appeal, also challenging the Property’s partially-tax-exempt status. The School District also intervened in the City's case. Ultimately, the trial court affirmed the Board's grant of a partial exemption. Both the City and the School District appealed to the Commonwealth Court, and Taxpayer cross-appealed as to each, seeking fully-exempt status for the Property. In a memorandum decision, the Commonwealth Court vacated and remanded to the trial court for more specific findings to support the partial tax exemption. On remand, the trial court set forth particularized findings and conclusions, and re-affirmed its earlier decision assessing the Property. At this juncture, the City elected not to appeal to the Commonwealth Court. The School District appealed the ruling in its own case, but it did not appeal the identical, simultaneous ruling which contained the City’s docket number. Taxpayer moved to quash the School District’s appeal. The Commonwealth Court granted the motion and dismissed the appeal observing that the common pleas court’s ruling in the City’s case became final after no party appealed it. Because the School District had intervened in that matter, it was a party to those proceedings. With that premise, the court found that res judicata and collateral estoppel barred it from reaching the merits. The Pennsylvania Supreme Court found that issue preclusion under the rubric of collateral estoppel should not have been applied to defeat the School District’s ability to obtain merits review of its substantive arguments in the intermediate court. The Commonwealth Court's judgment was vacated and the matter remanded for a merits disposition of the consolidated cross-appeals. View "In Re: Appeal of Coatesville Area Sch Dist" on Justia Law

The appellant property owners (“Taxpayers”) allowed billboards to be placed their lands. The appellee local taxing authorities, Chester-Upland School District and Chichester School District (the “School Districts”), filed 22 assessment appeals relating to the subject properties for tax years 2014 and forward. In their appeals, the School Districts sought to increase the assessed value based on the presence of the billboards. After relief was denied by the county assessment board, the School Districts appealed to the Court of Common Pleas. Separately, four property owners also appealed to that court after their properties were reassessed due to the presence of billboards. The issue presented for the Pennsylvania Supreme Court's review was whether the presence of a billboard on a property could affect the valuation of that property, such as where the landowner was entitled to ongoing payments pursuant to a lease with the billboard company. The Supreme Court found the Pennsylvania General Assembly has directed that billboards and their supporting structures were not real estate for tax assessment purposes. Here, the Court concluded the Commonwealth Court appropriately concluded that, although a billboard’s value may not itself be considered when assessing the underlying real property’s value, any increase in such value attributable to the billboard’s presence could be considered. View "In Re: Consol Apl of Chester-Upland SD, et al -" on Justia Law

Appellants Fred and Jolene Fouse owned two parcels of land in Huntingdon County, Pennsylvania, identified which they used as their primary residence from the time they acquired the two parcels in 1976 and 1987, respectively. Eventually, the Fouses fell behind in paying their property taxes. As mandated by the Real Estate Tax Sale Law (RETSL), the Huntington County Tax Claim Bureau scheduled an upset tax sale. Appellees Saratoga Partners, LP submitted the highest bid. Three months later, in December 2016, the Fouses filed a “petition to redeem property sold at tax sale,” even though Huntington County, a sixth class county, prohibited post-sale redemptions. Instead, the Fouses asserted, inter alia, a right to redeem under section 7293 of the Municipal Claims and Tax Liens Act (MCTLA), by paying the amount paid by Saratoga at the tax sale. In their brief, the Fouses acknowledged that the MCTLA applied only to first and second class counties, but the absence of a right of redemption provision in the RETSL resulted in citizens of second class A through eighth class counties being treated less favorably than citizens of first and second class counties, in violation of the equal protection provisions of the federal and state constitutions. After review, the Pennsylvania Supreme Court concluded the General Assembly’s decision to omit the right of post-sale redemption from the RETSL was constitutional because it was rationally related to a legitimate state interest. Accordingly, the Court affirmed the Commonwealth Court's order upholding the denial of the Fouses' petition for redemption. View "Fouse v. Saratoga Partners, et al" on Justia Law

In 2002, Edella and Eric Johnson executed a $74,000 mortgage and associated promissory note, secured by property in Pittsburgh. The instrument was recorded and later assigned to the Bank of New York Mellon Trust Company (“Mellon”). Six years later, the Johnsons defaulted on their mortgage. In March 2009, Mellon, through its debt-collection counsel Phelan Hallinan & Schmieg, LLP (“Phelan”), filed a complaint in mortgage foreclosure. In that complaint, Phelan included a claim for attorneys’ fees of $1,300. Following a non-jury trial, the court entered judgment for Mellon. In March 2012, while the underlying mortgage foreclosure case was still ongoing, the Johnsons filed the instant class action against Phelan. When the Pennsylvania Loan Interest and Protection Law ("Act 6") was enacted in 1974, a “residential mortgage” was defined as “an obligation to pay a sum of money in an original bona fide principal amount of fifty thousand dollars ($50,000) or less.” In 2008, however, the General Assembly amended Act 6’s definition of a “residential mortgage” to increase the principal-amount ceiling to $217,873 - a base figure that automatically was adjusted for inflation annually. This appeal centered on whether that increased principal-amount ceiling should apply to mortgages that were executed before the 2008 amendment to Act 6. Specifically, the question presented was whether the $74,000 mortgage the Johnsons executed should have been considered a "residential mortgage" under Act 6, given that when Appellants' lender initiated foreclosure proceedings in 2009, the increased principal-amount ceiling had gone into effect. Because the Pennsylvania Supreme Court concluded that nothing in the 2008 legislation amending Act 6 demonstrated that the revised figure should have applied retroactively, the Supreme Court affirmed the Superior Court's order. View "Johnson v. Phelan Hallinan & Schmieg" on Justia Law

Appellant Sara Ladd, a New Jersey resident, owned two vacation properties on Arrowhead Lake in the Pocono Mountains. Ladd started renting one of these properties in 2009 and the other in 2013 to supplement her income after being laid off from her job as a digital marketer. Eventually, some of her Arrowhead Lake neighbors learned of her success and asked her to manage rental of their own properties. Ladd considered “short-term” vacation rentals to be rentals for fewer than thirty days, and limited her services to such transactions only. Ladd acted as an “independent contractor” for her “clients” and entered into written agreements with them related to her services. In January 2017, the Commonwealth’s Bureau of Occupational and Professional Affairs (the Bureau), charged with overseeing the Commission’s enforcement of Real Estate Licensing and Registration Act (RELRA), called Ladd to inform her she had been reported for the “unlicensed practice of real estate.” Ladd reviewed RELRA and concluded her short-term vacation property management services were covered by the statute, and she would have to obtain a real estate broker license to continue operating her business. As Ladd was sixty-one years old and unwilling to meet RELRA’s licensing requirements, she shuttered PMVP to avoid the civil and criminal sanctions described in the statute. The Pennsylvania Supreme Court considered the Commonwealth Court's holding that the RELA's broker licensing requirements satisfied the heightened rational basis test articulated in Gambone v. Commonwealth, 101 A.2d 634 (Pa. 1954), and thus do not violate Article I, Section 1 of the Pennsylvania Constitution when applied to a self-described “short-term vacation property manager.” The Supreme Court concluded the Commonwealth Court erred in so holding, and therefore reversed and remanded for further proceedings. View "Ladd et al v. Real Estate Commission, et al." on Justia Law

At issue was whether the rule of capture immunized an energy developer from liability in trespass, where the developer used hydraulic fracturing on the property it owned or leased, and such activities allowed it to obtain oil or gas that migrated from beneath the surface of another person’s land. Plaintiffs’ property was adjacent to a tract of land leased by Appellant Southwestern Energy Production Company for natural gas extraction. Plaintiffs alleged that Southwestern “has and continues to extract natural gas from under the land of the Plaintiffs,” and that such extraction was “willful[], unlawful[], outrageous[] and in complete conscious disregard of the rights and title of the Plaintiffs in said land and the natural gas thereunder.” Southwestern alleged that Plaintiffs’ claims were barred by, inter alia, the rule of capture, and sought declaratory relief confirming its immunity from liability. The court of common pleas court granted Southwestern’s motion for summary judgment, denied Plaintiffs’ motion for partial summary judgment, and denied the motion to compel as moot. The court agreed with Southwestern’s position that the rule of capture applied in the circumstances and, as such, Plaintiffs could not recover under theories of trespass or conversion even if some of the gas harvested by Southwestern had drained from under Plaintiffs’ property. The Superior Court reversed, holding that hydraulic fracturing could give rise to liability in trespass, particularly if subsurface fractures ... crossed boundary lines. The Pennsylvania Supreme Court rejected the concept that the rule of capture was inapplicable to drilling and hydraulic fracturing that occurred entirely within the developer’s property solely because drainage was the direct or indirect result of hydraulic fracturing. Nevertheless, the Supreme Court found the Superior Court panel’s opinion "to suffer from multiple infirmities," reversed and remanded with directions. View "Briggs, et al v. Southwestern Energy" on Justia Law