Roethlein v. Portnoff Law Associates, Ltd., 623 Pa. 1

Portnoff Law Associates acted as a private tax collector for Pennsylvania municipalities under the Municipal Claims and Tax Liens Act (MCTLA).
Portnoff employed systematic charges (e.g., $150 file opening, $150 lien filing, $150 writ of scire facias) and a $35 administrative cost to delinquent taxpayers, plus 10% interest on principal.
Municipalities could authorize Portnoff to impose legal fees via ordinances/resolutions; Portnoff passed those costs to delinquent taxpayers and remitted proceeds to municipalities.
In November 2002, Beverly Roethlein filed a class action alleging unjust enrichment and violations of Act 6 (Loan Interest and Protection Law) for overcharging taxpayers.
Commonwealth Court held that Act 6 does not provide a standalone remedy for non-loan related charges, and that Portnoff’s $35 fee was not recoverable under MCTLA as charged, leading to an appeal to the Pennsylvania Supreme Court.
The Pennsylvania Supreme Court held (1) Act 6 does not provide a cause of action for charges not arising from the loan or use of money; (2) whether Act 6 may be pursued as a class action was not necessary to decide; (3) Section 7103 of the MCTLA allows municipalities to recover third-party collector fees, and the $35 administrative cost may be recoverable under MCTLA for the relevant time period.

Issue	Plaintiff's Argument	Defendant's Argument	Held
Does Act 6 provide a remedy for charges not tied to loan or use of money?	Taxpayers argue §502 is broad and covers excess charges beyond loan use.	Portnoff argues §502 applies only to loans/usages of money.	Act 6 does not apply to non-loan charges.
May Act 6 claims be pursued as a class action?	Taxpayers seek class action treatment under Act 6.	Portnoff contends class action is inappropriate.	Not decided; court decided resolution on other issues renders this moot.
Are the $35 administrative costs recoverable under MCTLA §7103 as costs of collection?	Taxpayers seek recovery of the $35 fee as a cost of collection.	Portnoff asserts the fee is not a cost incurred by the taxing authority.	Portnoff’s $35 fee recoverable under MCTLA, reversed Commonwealth Court.
Does §7101 define ‘taxes’ to include third-party collection fees, permitting recovery of those fees?	Taxpayers rely on broad definition to include third-party costs.	Portnoff argues limitation to actual municipal costs.	Yes; §7101 includes third-party collector fees when approved by municipal action.
Did the 2004 amendment to §7101 affect recoverability of Portnoff’s fees for 2000–2002?	Questions of retroactive application and scope.	Amendment clarified later practice; does not negate earlier recoveries.	Court held analysis consistent with text; remand for proceedings consistent with opinion.

Pollice v. Nat’l Tax Funding, L.P., 225 F.3d 379 (3d Cir. 2000) (usury laws apply to loan/use of money; not to non-loan charges)
In re Estate of John Francis Braun, 650 A.2d 73 (Pa. Super. Ct. 1994) (usury law limits to loan/use of money; similar reasoning later followed)
Equip. Fin., Inc. v. Grannas, 218 A.2d 81 (Pa. Super. Ct. 1966) (usury scope restricted to loan-related matters)
In re Kenin’s Trust Estate, 23 A.2d 837 (Pa. 1942) (precedent that money use/loan framed scope of Act 6)
Pentlong Corp. v. GLS Capital, Inc., 820 A.2d 1240 (Pa. 2003) (limits on costs recoverable under §7103 to costs actually incurred)
Konidaris v. Portnoff Law Assoc.,, 820 A.2d 1240 (Pa. 2003) (amendments to MCTLA context; costs recoverable when incurred)