F.A. Investment Group Inc., F.A. Realty Investors Corp. and Information Mgmt. Group, Inc. v. City of Philadelphia
F.A. Investment Group Inc., F.A. Realty Investors Corp. and Information Mgmt. Group, Inc. v. City of Philadelphia - 2734 C.D. 2015
| Pa. Commw. Ct. | May 4, 2017Background
- Property Owners (F.A. Investment Group, F.A. Realty Investors, Information Management Group) petitioned for appointment of a Board of Viewers alleging a de facto taking of 6001 N. 17th St., Philadelphia, after the City boarded, padlocked and posted a cease-and-desist at the building on March 11, 2003.
- Owners alleged no prior code violations and claimed the City provided no notice or subsequent legal action; they also alleged prior instances where the City demolished or condemned several of their properties.
- City filed preliminary objections, asserting the boarding was an exercise of police power to abate imminent hazards to health and safety and thus not a taking under the Eminent Domain Code.
- Record shows L&I inspection documentation of numerous serious code violations (fire, electrical, heating, exits, elevator, hazardous materials, lack of rental license) and testimony that fumes after an oil delivery posed immediate danger.
- Owner testified he was not allowed back in the building, did not appeal the cease operations order, and contacted no City office after the boarding; City testimony described standard notice and appeal procedures and that notices were sent to the owner’s OPA address.
- Trial court sustained City’s preliminary objections, finding the action was a valid exercise of police power, not eminent domain; Commonwealth Court affirmed.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether boarding and closure constituted a de facto taking under the Eminent Domain Code | City’s boarding and subsequent loss of property deprived owners of beneficial use and evidence of a de facto taking; alleged prior City statements indicated intent to seize properties | City acted under police power to abate imminent hazards (fumes, serious code violations); actions were regulatory, appealable, and not an exercise of eminent domain | Court held no de facto taking: City’s actions were a lawful exercise of police power, not eminent domain |
| Whether owners pleaded sufficient exceptional circumstances to show a de facto taking | Owners argued exceptional circumstances existed because they lost property use and eventually lost the property through tax sale | City pointed to documented, serious unremedied code violations and available notice/appeal mechanisms; owner failed to exhaust remedies or appeal | Court held owners failed to show exceptional circumstances or causal link to an exercise of eminent domain |
| Whether the City failed to provide due process notice/opportunity to correct | Owners asserted lack of actual notice and denial of process | City produced testimony about notice procedures and that notices were sent to addresses on file; owner admitted he knew the building was boarded but did not appeal or contact City | Court held due process claim meritless given owner’s admissions and failure to pursue available remedies |
| Admissibility/weight of owner’s evidence of an alleged 1990 statement about seizures | Owners relied on Frempong’s uncorroborated, remote testimony about a 1990 comment to show City’s intent | City argued that bald, remote hearsay lacks probative value and does not establish intent or eminent domain action | Court found the testimony too remote and indefinite to have probative value and insufficient to overcome documentary and L&I evidence |
Key Cases Cited
- Hill v. City of Bethlehem, 909 A.2d 439 (Pa. Cmwlth. 2006) (standards for establishing a de facto taking)
- German v. City of Philadelphia, 683 A.2d 323 (Pa. Cmwlth. 1996) (acts not in exercise of eminent domain cannot form basis for eminent domain proceeding)
- Redevelopment Authority of Oil City v. Woodring, 445 A.2d 724 (Pa. 1982) (distinction between police power regulation and eminent domain requiring compensation)
- Balent v. City of Wilkes-Barre, 669 A.2d 309 (Pa. 1995) (police power must have recognized public purpose reasonably related to objective)
- Estate of Blose v. Borough of Punxsutawney, 889 A.2d 653 (Pa. Cmwlth. 2005) (property held subject to reasonable regulation to protect public health and safety)