York Rd. Realty Co., L.P. v. Cheltenham Twp.

136 A.3d 1047

YORK ROAD REALTY CO., L.P., Appellant

v.CHELTENHAM TOWNSHIP.

No. 1513 C.D. 2015

Commonwealth Court of Pennsylvania.

Argued Feb. 9, 2016.

Decided March 2, 2016.

Reargument Denied April 20, 2016.

Publication Ordered April 26, 2016.

Michael Yanoff, Jenkintown, for appellant.

Joseph M. Bagley, Blue Bell, for appellee.

BEFORE: PATRICIA A. McCULLOUGH, Judge, and ANNE E. COVEY, Judge, and JAMES GARDNER COLINS, Senior Judge.

OPINION BY Judge ANNE E. COVEY.

York Road Realty Co., L.P. (York Road) appeals from the Montgomery County Common Pleas Court's (trial court) July 17, 2015 order sustaining Cheltenham Township's (Township) preliminary objections and dismissing York Road's complaint and petition for appointment of board of viewers (Complaint/Petition). The issues before this Court are whether the trial court erred by: (1) ruling, without conducting an evidentiary hearing, that York Road did not make out a prima facie case of a de facto taking because York Road does not have a compensable property interest and, (2) holding that removal of the footbridge over Tookany Creek (Footbridge) did not impact the public's access to York Road's business. After review, we affirm.

Since 2002, York Road has owned and operated the York Road Ice Skating Rink (Rink) located at 8116 Old York Road in the Township (Property). The Property is located off Bosler Road, behind a medical office. In order to gain access to the Property and its limited parking spaces, vehicles must turn off Bosler Road, and pass through the medical office parking lot.

Wall Park is a Township park located adjacent to the medical office, separated by Tookany Creek. Wall Park has a Township-owned public parking lot. According to York Road's Complaint/Petition, since before 1978, when a sewer line was installed over Tookany Creek and covered by the Footbridge, Rink patrons would park in the Wall Park lot, cross over the Footbridge and walk through the medical office property (8118 Old York Road) in order to access the Property. PECO has a deeded easement through the medical office's property; York Road does not. Although the medical office owner did not prohibit Rink patrons from walking across its property to reach the Rink, parking by Rink patrons in the medical office lot has been prohibited.

After Hurricane Irene in August 2011 and Tropical Storm Lee in September 2011 damaged the sewer line to the point that it was spewing raw sewage into Tookany Creek, and the Footbridge was “blown away,” the Township repaired the sewer line but did not replace the Footbridge. Reproduced Record (R.R.) at 122a. Thereafter, “patrons, users and guests were obliged to attempt limited access to the Property and the Rink through [the medical office property], by way of an access easement[.]” R.R. at 56a–57a (Complaint/Petition ¶ 25). Lack of direct Footbridge access to the Property purportedly caused York Road lost business and revenue. See R.R. at 57a.

On September 8, 2014, York Road filed a writ of summons against the Township and conducted pre-pleading discovery, including interrogatories and requests for production of documents. See R.R. at 6a–49a. On November 20, 2014, York Road filed its Complaint in which it claimed that the Township owned the Footbridge and demanded damages on the basis that the Township's failure to repair or replace the Footbridge was a de facto taking/inverse condemnation under Section 714 of the Eminent Domain Code (Code),¹ 26 Pa.C.S. § 714 (Count I). York Road's pleading also contained its Petition in accordance with Section 502 of the Code, 26 Pa.C.S. § 502 (Count II). See R.R. at 52a–89a.

The Township filed preliminary objections to York Road's Complaint/Petition, wherein, the Township contended that York Road failed to allege facts sufficient to impose a legal duty upon the Township to rebuild the Footbridge or to compensate York Road for its loss, and that ingress and egress to the Rink at all times remained open through public roads. In the alternative, the Township argued that the circumstances in this case do not involve exceptional circumstances that interfered with York Road's use and enjoyment of the Property so as to inflict compensable injury. See R.R. at 90a–96a, 130a–151a. York Road responded to the Township's preliminary objections. See R.R. at 97a–128a, 158a–171a. The trial court heard argument on June 19, 2015. See R.R. at 212a–254a. The trial court sustained the Township's preliminary objections and dismissed York Road's Complaint/Petition. See R.R. at 183a. On August 7, 2015, York Road appealed to this Court.²

Initially, “we have held that the [Code] provides the exclusive method and practice governing eminent domain proceedings, including de facto takings, and that preliminary objections are the exclusive method of raising objections to a petition for appointment of viewers alleging a de facto taking [.]” Gerg v. Twp. of Fox, 107 A.3d 849, 852 (Pa.Cmwlth.2015) (citation omitted). Specifically, Section 502(c)(1) of the Code authorizes the “owner of a property interest who asserts that the owner's property interest has been condemned without the filing of a declaration of taking[, to] file a petition for the appointment of viewers ... setting forth the factual basis of the petition.” 26 Pa.C.S. § 502(c)(1). Section 504(d) of the Code provides, in relevant part:

(1) Any objection to the appointment of viewers may be raised by preliminary objections filed within 30 days after receipt of notice of the appointment of viewers.

....

(5) If an issue of fact is raised, the court shall conduct an evidentiary hearing or order that evidence be taken by deposition or otherwise, but in no event shall evidence be taken by the viewers on this issue.

26 Pa.C.S. § 504(d). Accordingly, this Court has concluded that “preliminary objections in the context of proceedings under the Code are distinct from preliminary objections in the context of a proceeding under the Pennsylvania Rules of Civil Procedure.” William Schenk & Sons v. Northampton, Bucks Cnty., Mun. Auth., 97 A.3d 820, 824 (Pa.Cmwlth.2014). “In proceedings under the Code, preliminary objections are intended as a procedure to resolve all legal and factual challenges to a declaration of taking before proceeding to the damages issue—i.e., hearing by an appointed board of viewers.” Id.

The law is well-settled:

In order to prove a de facto taking, the property owner must establish exceptional circumstances that substantially deprived him of the beneficial use and enjoyment of his property. This deprivation must be caused by the actions of an entity with eminent domain powers. Also, the damages sustained must be an immediate, necessary and unavoidable consequence of the exercise on the entity's eminent domain powers.^{[3 ]} A de facto taking is not a physical seizure of property; rather, it is an interference with one of the rights of ownership that substantially deprives the owner of the beneficial use of his property. The beneficial use of the property includes not only its present use, but all potential uses, including its highest and best use.

In re Borough of Blakely, 25 A.3d 458, 463–64 (Pa.Cmwlth.2011) (citations omitted; emphasis added). “Property owners alleging a de facto taking bear a heavy burden of proof.... Further, there is no bright line test to determine when a government action results in a de facto taking; each case turns on its own facts.” Id. at 465.

York Road in its Complaint/Petition also alleged a claim under Section 714 of the Code, which states: “All condemnors ... shall be liable for damages to property abutting the area of an improvement resulting from change of grade of a road or highway, permanent interference with access or injury to surface support, whether or not any property is taken.” 26 Pa.C.S. § 714. This Court has “recognize[d] the issue of consequential damages to property due to work by a municipality on its own abutting property. When access to property is interfered with, it creates a right to compensation by the land owner from the government.” Borough of Walnutport v. Dennis, 13 A.3d 541, 550 (Pa.Cmwlth.2010). A consequential damage claim under Section 714 of the Code is separate and distinct from a claim for a de facto taking under Section 502(c)(1) of the Code.⁴ Colombari v. Port Auth. of Allegheny Cnty., 951 A.2d 409 (Pa.Cmwlth.2008).⁵

York Road first argues that the trial court erred by ruling, without conducting an evidentiary hearing, that York Road did not make out a prima facie case of a de facto taking because York Road does not have a compensable property interest. Specifically, York Road contends that it pled sufficient facts to merit an evidentiary hearing on whether a de facto taking occurred, since it alleged in the Complaint/Petition that York Road suffered a substantial deprivation of its property by the Township, an entity vested with eminent domain power, when it eliminated York Road's “sole reliable means of accessing the Property” and caused York Road immediate, unnecessary and avoidable damages. York Road Br. at 16; see also

York Road Br. at 15–17. York Road also claimed that the multiple disputed factual issues require an evidentiary hearing.

In Linde Enterprises, Inc. v. Lackawanna River Basin Sewer Authority, 911 A.2d 658 (Pa.Cmwlth.2006), this Court held that when reviewing preliminary objections to a petition for the appointment of viewers,

[t]he trial court must determine whether, as a matter of law, the averments of the petition for the appointment of viewers, taken as true, in addition to any stipulated facts, are sufficient to state a cause of action for a de facto taking. If not, the preliminary objections must be sustained and the petition dismissed or allowed to be amended. If the averments, taken as true, might establish a de facto taking, the trial court must take evidence by depositions, or otherwise, so that a judicial determination might be made.

Id. at 661 (quoting Hill v. City of Bethlehem, 909 A.2d 439, 443 (Pa.Cmwlth.2...