Justia Pennsylvania Supreme Court Opinion Summaries

Articles Posted in Real Estate & Property Law
by
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

by
Decedent Sophia Krasinski died testate in 2006. The primary assets of her estate included three parcels of real estate. The Executor was one of the Decedent’s four children, who also included Eleanor Krasinski, James Krasinski, and Patricia Krasinski-Dunzik. Decedent’s will directed that each of her four children were equal beneficiaries of the residue of the estate. In 2010, the Executor filed a petition to permit the private sale of real estate to heirs. The orphans’ court granted the Executor’s petition to permit the sale. Dunzik and her husband sued the estate based upon an alleged oral contract with the Decedent regarding the property. After a nonjury trial, the trial court ruled that there was no enforceable oral contract between Dunzik and Decedent and dismissed the case. This trial court order also lifted a stay on the orphans’ court’s prior order approving the private sale of the Decedent’s lands. Dunzik did not appeal the trial court’s rulings. The sale proceeded; the Executor, James and his wife, and Dunzik attended, at which time Dunzik stated that she would not be bidding because she believed that she already owned the properties. Dunzik again challenged the completed sales. This discretionary appeal presented the Pennsylvania Supreme Court with an opportunity to clarify the proper scope of Rule 342(a)(6) of the Pennsylvania Rules of Appellate Procedure, which provided for an appeal as of right from an order of the Orphans’ Court Division that “determin[es] an interest in real or personal property.” The statute further provided that the failure of a party to immediately appeal an order appealable under, inter alia, Rule 342(a)(6), constitutes a waiver of all objections to the order. The Supreme Court concluded Dunzik waived all objections to the orphans’ court’s order approving the private sale. View "In Re: Estate of Krasinski" on Justia Law

by
Kenneth and Theresa-Ramondo purchased a property in Chester County, Pennsylvania in 1991 known as a “flag lot:” a narrow strip (the “pole”) that connected the main portion to a public street. The Ramondo pole extended six hundred feet from Garrett Mill Road to the main portion of the Ramondo property, the flag portion, which was approximately 5.62 acres. Thaddeus Bartkowski, III, and Crystal Anne Crawford (“the Bartkowskis”) bought the neighboring property 2012, which was also a flag lot. The pole of the Bartkowski property, also measuring twenty-five feet wide, abutted and ran parallel with the Ramondos’ pole. The flag portion of the Bartkowski property was approximately 5.25 acres. The portion of land at issue in this appeal involved the adjoining Ramondo and Bartkowski poles, upon which the Ramondos constructed a driveway that gave them access to Garrett Mill Road. The Pennsylvania Supreme Court granted allowance of appeal to consider whether a landowner had to prove impossibility of alternative access arising from zoning and regulatory prohibitions or conditions of the land in order to establish an easement by necessity. The Superior Court affirmed the trial court’s order denying the Ramondos an easement by necessity based upon the theory that establishing necessity requires proving impossibility of alternative access. The Supreme Court concluded this was error, reversed the Superior Court, remanded for further proceedings. View "Bartkowski v. Ramondo" on Justia Law

by
This appeal involved an ejectment action commenced by the City of Philadelphia (“City”) against Francis Galdo, and a counterclaim to quiet title filed by Galdo, claiming ownership of the property at issue by adverse possession. In 1974, City Council passed an ordinance authorizing the Commissioner of Public Property to execute a Declaration of Taking of several properties, including the Parcel at issue here. On November 13, 1974, the City obtained fee simple title to the Parcel by condemnation, with the notice of condemnation stating that the Parcel had been condemned for transit purposes. In 1976, the Commonwealth filed a notice of condemnation against several of the City’s lots, indicating that the Commonwealth would permanently retain the land in the I-95 right-of-way, and that the Commonwealth would have a temporary easement on other condemned properties, including the Parcel condemned by the City, during the period that the Elevated Frankford train line was rerouted to allow for construction of I-95. Germane to this appeal, the parties agreed the City did not physically occupied the Parcel since completion of the work connected to the rerouting of the Elevated Frankford train line in the 1970s. Further, it was undisputed the City did not perform any maintenance, grass- cutting, grading, or landscaping on the Parcel. Instead, after the highway construction was completed, the City viewed the Parcel as “surplus property” that was not actively being used. At least a decade after construction of I-95 had been completed, in September 1989, Galdo purchased a two-story dwelling located directly across the street from the Parcel. At that time, the Parcel was not being maintained and was purportedly home to “prostitutes” and “derelicts”. Galdo cleared the Parcel of weeds and trash, poured a concrete slab, and parked his vehicles there. He also used the Parcel to discard debris from the remodeling of his home. By 1992, Galdo poured another concrete slab on the Parcel for storing materials and enclosed that area with a fence. In 1994, he installed on the Parcel a fire pit and a picnic table affixed to the ground. Over the years Galdo continued to make improvements to the Parcel. He never obtained any permits to make improvements to the Parcel, did not pay property taxes for the Parcel, and did not provide evidence that he insured the Parcel. Further, it is undisputed that the City never gave Galdo permission to possess the land at issue. The trial court ruled in favor of the City, holding that it was immune from suit because a claim of adverse possession could not lie against a municipality. The Commonwealth Court vacated the trial court’s order and remanded for trial on the adverse possession claim, holding that the adverse possession claim could proceed against the City because the property was not devoted to a public use during the twenty-one-year prescriptive period, as required for immunity to apply. The Pennsylvania Supreme Court agreed the City was not immune from a claim of adverse possession under the facts presented and affirmed the order of the Commonwealth Court. View "City of Phila. v. Galdo" on Justia Law

by
TSG Real Estate, LLC (“TSG”) was a real estate company that owned a commercial property in Montgomery County, Pennsylvania (the “Property”). Initially, TSG hired New Hart Corporation d/b/a Hart Corporation (“Hart”) as its broker to market the Property. As TSG’s agreement with Hart was to expire, TSG began considering replacement brokers, one of which was Binswanger of Pennsylvania, Inc. (“Binswanger”). Two days before TSG informed Binswanger of its decision to hire it as its broker, TSG received a written offer from TWA Holdings, LLC (“TWA”) to purchase the Property for $3.7 million. TSG negotiated an agreement with Binswanger culminating in a September 27, 2013 “Exclusive Right To Sell Or Lease Agreement” (“Broker Agreement”) with Binswanger. The Broker Agreement permitted TSG to continue using other brokers in connection with any sale to TWA, and provided, inter alia, (1) if Binswanger sold the Property, it would be entitled to a 5% commission; (2) all commissions would be considered to be earned and payable “at the time scheduled for closing on a sale;” (3) a “carve-out period” which allowed that if another broker “completed” a sale, exchange, or transfer of the Property to TWA on or before January 5, 2014, Binswanger would earn no commission; (4) if another broker completed a sale of the Property to TWA after January 5, 2014, the other broker and Binswanger would split a 5% commission; and (5) the duration of the agreement was for one year; however, TSG had the right to terminate the agreement after 6 months with 30 days prior written notice to Binswanger. Two days prior to the expiration of the carve-out period contained in the Broker Agreement, TSG, via Hart and another broker, Gelcor Realty (“Gelcor”), entered into an Agreement of Sale with TWA, selling the Property for $3.4 million. In this appeal by allowance, the Pennsylvania Supreme Court considered the entitlement to broker commissions for the sale of commercial property. Applying the plain and unambiguous language of the Broker Agreement, the Supreme Court found the sale of the Property was completed at the time of closing, i.e., on April 24, 2014. As the sale was not completed on or before January 5, 2014, but only after the carve-out period had expired, Binswanger was entitled to a commission pursuant to the Broker Agreement fee schedule. View "Binswanger of PA Inc v. TSG Real Estate LLC." on Justia Law

by
At issue in this case was whether Appellees Burton and Joanne Adams demonstrated that opening a private road over the property of Appellant James Corl was necessary under the Private Road Act. The Pennsylvania Supreme Court concluded the Adamses did not demonstrate necessity as a matter of law based on their contemplated future use of their property, when, as in accordance with the Act, necessity had to be based on the existing use of the property. Accordingly, the Court reversed the Commonwealth Court’s order affirming the trial court’s confirmation of the Board of View’s (Board) report recommending the grant of a private road in favor of the Adamses. View "In Re: Petition of Adams" on Justia Law

by
The Pennsylvania Supreme Court granted discretionary review to determine whether a zoning ordinance that defined “family” as requiring “a single housekeeping unit” permitted the purely transient use of a property located in a residential zoning district. This question arose based on the increasingly popular concept of web-based rentals of single-family homes to vacationers and other short-term users (usually for a few days at a time). The Supreme Court concluded that pursuant to its prior decisions in Albert v. Zoning Hearing Bd. of N. Abington Twp., 854 A.2d 401 (Pa. 2004), and In re Appeal of Miller, 515 A.2d 904 (Pa. 1986), the purely transient use of a house is not a permitted use in a residential zoning district limiting use to single-family homes by a "single housekeeping unit." View "Slice of Life, et al v. Hamilton Twp ZHB" on Justia Law

by
This appeal arose from four separate, yet substantively similar, lawsuits filed by the county recorders in Delaware, Chester, Bucks and Berks Counties, Pennsylvania, and their respective Counties (collectively, the Recorders). The Recorders sued appellees, MERSCORP, Inc., its wholly-owned subsidiary, Mortgage Electronic Registration Systems, Inc. (MERS), and several financial institutions who are members of MERS (collectively, MERSCORP). The issue presented for the Pennsylvania Supreme Court was whether the Commonwealth Court correctly determined that 21 P.S. 351, “Failure to record conveyance,” did not create a mandatory duty to record all mortgages and mortgage assignments in a county office for the recorder of deeds. The Third Circuit Court of Appeals reversed a federal district court’s decision and held Section 351 did not create a mandatory duty to record all land conveyances. Relying on the Third Circuit’s decision, MERSCORP filed preliminary objections in the nature of a demurrer to the Recorders’ complaints at state court, seeking dismissal on the basis that Section 351 did not provide a duty to record, and the Recorders did not have authority to enforce Section 351 in any event. The court overruled the preliminary objections, and denied MERSCORP’s request to certify its interlocutory order for an immediate appeal. MERSCORP then filed a petition for review in the Commonwealth Court; a divided Commonwealth Court reversed. The majority agreed with the Third Circuit’s conclusion in the Federal Action, specifically ruling “Section 351 does not issue a blanket command that all conveyances must be recorded; it states that a conveyance ‘shall be recorded’ in the appropriate place, or else the party risks losing his interest in the property to a bona fide purchaser.” The majority observed the plain language of Section 351 did not specify which party to a transaction must record a conveyance, nor did it state when recording must take place. The majority also recognized Pennsylvania courts have consistently interpreted Section 351 and other provisions of Title 21 as intended to protect subsequent mortgages and purchasers, and that the failure to record inherently provides a limited consequence — the loss of a priority interest. The majority found further support for its conclusion in precedent recognizing as valid even unrecorded interests in land. The majority noted the Recorders have a ministerial duty to the public to record and safeguard records presented to them for recording, but that duty does not confer standing to file actions to protect the public from “inaccurate” records in the MERS(r) system. The Recorders appealed, but finding no reversible error with the Commonwealth Court's judgment, the Supreme Court affirmed. View "MERSCORP, et al v. Delaware Co., et al." on Justia Law

by
James and Beryl Wicker signed a mortgage agreement for their residence in Punxsutawney, Pennsylvania in favor of Countrywide Bank, FSB (Countrywide) in February 2008. The mortgage agreement indicated that Mortgage Electronic Registration Systems, Inc. (MERS) would act as nominee for Countrywide and its successors and assigns and was designated as the mortgagee. In an assignment of mortgage recorded in November 2011, MERS, as nominee for Countrywide, assigned the mortgage to Bank of America. In May 2012, Bank of America filed a mortgage foreclosure action against the Wickers alleging that the Wickers defaulted on their mortgage as of September 1, 2010. It further averred that it had provided the Wickers with the statutorily required foreclosure notice on September 21, 2011. Bank of America then moved for summary judgment, which the trial court granted in part and denied in part. In so doing, the trial court narrowed the issues for trial to determining whether Bank of America had provided proof of: (1) the required foreclosure notices; (2) the date of default; and (3) the amount of indebtedness. The Pennsylvania Supreme Court granted review to consider the application of Pennsylvania’s business records exception to the rule against hearsay, pursuant to Pennsylvania Rule of Evidence 803(6) and the Uniform Business Records as Evidence Act, 42 Pa.C.S. 6108. The parties agreed that then-current Pennsylvania precedent allowed a records custodian to authenticate documents even if the witness did not personally record the specific information in the documents. The parties disagreed, however, as to whether a records custodian could lay a foundation for documents incorporated into the files of the custodian’s employer when the information in the documents was recorded by a third party, a process which was allowed under the similar but not identical Federal Rule of Evidence 803(6), pursuant to the so-called adopted business records doctrine. The Supreme Court affirmed the Superior Court in concluding that the trial court did not abuse its discretion in allowing the testimony of the records custodian and admitting the documents under the facts of this case. View "Bayview Loan v. Wicker" on Justia Law

by
Appellees Steven and Mary Szabo, owned real property where they operate a hair salon and skin care business. The property abutted Route 19 and Old Washington Road, was improved with a parking lot and commercial structure. Appellant, the Pennsylvania Department of Transportation (PennDOT or Department) developed a road expansion plan to connect Route 19 with Old Washington Road by means of an exit ramp that would run across a section of the Szabos land, identified in the declaration of taking as Parcel 5. The Department attempted to purchase the property from the Szabos; however, the parties could not come to an agreement. The issue this case presented for the Pennsylvania Supreme Court's review was whether a failure to file preliminary objections to a declaration of taking resulted in waiver under Section 306 of the Eminent Domain Code, 26 Pa.C.S. sections 101-1106 (Code). After careful review, the Court held that the declaration did not establish the extent or effect of the taking. Accordingly, the failure to file preliminary objections within thirty days of service did not result in waiver of the right to assert ownership and seek just compensation, and therefore the Court affirmed the decision of the Commonwealth Court to remand the matter for an evidentiary hearing. View "Szabo v. PennDOT" on Justia Law