Jennersville Hosp. v. Cnty. of Chester Bd. of Assessment Appeals

• Decision Date: 10 February 2023
• Docket Number: 1282 C.D. 2021,1286 C.D. 2021
• Parties: Jennersville Hospital, LLC, Appellant v. County of Chester Board of Assessment Appeals, Avon Grove School District and Penn Township
• Court: Pennsylvania Commonwealth Court

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Jennersville Hospital, LLC, Appellant v. County of Chester Board of Assessment Appeals, Avon Grove School District and Penn Township

Nos. 1282 C.D. 2021, 1286 C.D. 2021

Commonwealth Court of Pennsylvania

February 10, 2023

OPINION NOT REPORTED

Argued: November 16, 2022.

BEFORE: HONORABLE RENÉE COHN JUBELIRER, President Judge, HONORABLE PATRICIA A. McCULLOUGH, Judge, HONORABLE ANNE E. COVEY, Judge, HONORABLE MICHAEL H. WOJCIK, Judge HONORABLE CHRISTINE FIZZANO CANNON, Judge, HONORABLE ELLEN CEISLER, Judge, HONORABLE LORI A. DUMAS, Judge.

MEMORANDUM OPINION

CHRISTINE FIZZANO CANNON, Judge.

Jennersville Hospital, LLC (Hospital), appeals from a decision of the Court of Common Pleas of Chester County (trial court). After thorough review, we agree with the County of Chester Board of Assessment Appeals (Board) that Hospital has waived all issues on appeal. Accordingly, we dismiss the appeals.

We dismiss as moot Hospital's applications for relief seeking to strike the briefs filed by Patientrightsadvocate.org and Families USA as amici curiae in support of the Board.

I. Background

In 2017, Reading Health System, now known as Tower Health, LLC (Tower Health), bought several for-profit hospital facilities and related properties formerly owned by Community Health Systems (CHS), a for-profit entity, in Montgomery and Chester Counties. Trial Ct. Op. at 11-12. Tower Health, a limited liability company (LLC) with federal nonprofit status under 26 U.S.C. § 501(c)(3), created a new LLC to run each of the purchased hospital facilities as a nonprofit entity. Id. at 11. Tower Health is the sole member of each new LLC. Id. at 11 & 13. Hospital is one of the new LLCs and operates a hospital facility in Chester County. Id. at 12-13.

The Board denied Hospital's application for a property tax exemption for tax years 2018 through 2021. Hospital appealed to the trial court, which held a de novo trial. The trial court also denied the property tax exemption, finding that Hospital failed to sustain its burden of proving entitlement to a tax exemption as a nonprofit entity.

Hospital then appealed to this Court. In response to the trial court's directive to file a concise statement of errors complained of on appeal pursuant to Rule 1925(b) of the Pennsylvania Rules of Appellate Procedure (1925(b) Statement), Pa. R.A.P. 1925(b), Hospital filed a 19-page 1925(b) Statement containing some 88 issues and sub-issues. Application to Dismiss, Ex. A. In its subsequent opinion pursuant to Rule 1925(a) of the Pennsylvania Rules of Appellate Procedure (1925(a) Opinion), Pa. R.A.P. 1925(a), the trial court stated that Hospital's 1925(b) Statement failed to comply with the rule's conciseness requirement and hindered the trial court in preparing its 1925(a) Opinion. 1925(a) Op. at 3.

In Hospital's appeals before this Court, Patientrightsadvocate.org and Families USA filed joint briefs as amici curiae in support of the Board's denial of the property tax exemption. Hospital has filed applications for relief seeking to strike the briefs of the amici because they discuss matters not in the record.

II. Issues

Hospital raises six issues in its brief on appeal, which we combine into three issues. First, Hospital asserts that it had standing to apply for a real estate tax exemption for tax year 2018 even though, at the time the application was filed in 2017, Hospital was not the legal owner of the property at issue. Second, Hospital contends that the trial court improperly considered expert testimony asserting legal conclusions and that those conclusions were contrary to law. Third, and primarily, Hospital maintains that it met all of the factual and legal requirements for a property tax exemption. In addition, Hospital argues that this Court should grant Hospital's application for relief and strike the briefs filed by the amici because the briefs improperly contained information not in the record before this Court and presented arguments not raised by the parties.

The Board opposes each of Hospital's arguments. Further, the Board has filed an application for relief seeking dismissal of this appeal. The Board posits that Hospital waived all of its issues on appeal because it filed a 1925(b) Statement that failed to comply with the rule's conciseness requirement.

We have reordered our discussion of the issues for convenience and clarity.

III. Discussion^[1]

A. Standing for Tax Year 2018

The Board argues that for tax year 2018, Hospital had no standing to seek a tax exemption because Tower Health's purchase of the affected properties was not complete or certain at the time it filed its applications for the tax exemptions in 2017. However, the asset purchase agreement was pending for several months before the deed transferring the properties was recorded in October 2017. See Trial Ct. Op. at 21 & 23-24; Reproduced Record (RR) at 283a, 2022a, 2057a, 2059a & 2072a; Hospital's Br. at 5-6. Moreover, the purchase transaction was complete before the Board's hearing on Hospital's application for a property tax exemption. See RR at 2072a (reciting that transaction closed on October 1, 2017), 595a & 601a (Board decisions reciting that Board hearings were held on October 19, 2017 and September 12, 2018). Had the application for tax exempt status been delayed until the purchase transaction was complete and the deed recorded, the 2017 filing window for 2018 tax exempt status, which was May 1 to August 1, see RR at 581a-82a & 585a, would have expired. Therefore, as the equitable owner of the property, Hospital maintains it was an aggrieved party entitled to apply for a tax exemption, in accordance with Section 8844(c)(1) & (2) of the Consolidated County Assessment Law (CCAL),^[2] 53 Pa.C.S. § 8844(c)(1) & (2) (relating to annual appeal deadlines).

The trial court opined that Hospital lacked standing to apply for a 2018 tax exemption because neither Tower Health nor Hospital was the record owner of the property at issue at the time the application was filed. The trial court acknowledged that equitable ownership would be sufficient to confer standing. Trial Ct. Op. at 21 & 23-24. However, the trial court deemed the purchase agreement insufficiently certain to confer equitable ownership status. Id. at 23-24. The trial court pointed to the conditional and complex nature of the purchase agreement and the number of conditions, including a $590 million bond issue, that had to be satisfied for the purchase of the multiple properties involved in Tower Health's purchase transaction, which included properties in both Montgomery and Chester Counties. Id. at 12 & 23-24. The trial court also observed that settlement for the transaction did not occur until October 2017, after several continuances. Id. at 24.

However, the trial court did not cite any authority to support its determination that the contingent nature of the purchase transaction deprived Hospital of standing in 2017 to pursue a tax exemption for the 2018 tax year. See Trial Ct. Op. at 21 & 23-24. We are likewise unaware of any such authority.^[3] Accordingly, we agree with Hospital that it had standing to seek a tax exemption prospectively for tax year 2018 while Tower Health's purchase transaction was pending.

B. Waiver of Issues on Appeal

Rule 1925(a) of the Pennsylvania Rules of Appellate Procedure requires a trial court, upon receipt of a notice of appeal from its decision, to provide a written opinion explaining the reasons for its decision. Pa. R.A.P. 1925(a). Rule 1925(b)(4) provides, in pertinent part:

(b) Direction to file statement of errors complained of on appeal; instructions to the appellant and the trial court.- If the judge entering the order giving rise to the notice of appeal ("judge") desires clarification of the errors complained of on appeal, the judge may enter an order directing the appellant to file of record in the trial court and serve on the judge a concise statement of the errors complained of on appeal ("[1925(b)] Statement").

. . . .

(4) Requirements; waiver.

(i) The [1925(b)] Statement shall set forth only those errors that the appellant intends to assert.

(ii) The [1925(b)] Statement shall concisely identify each error that the appellant intends to assert with sufficient detail to identify the issue to be raised for the judge . . . .

(iv) The [1925(b)] Statement should not be redundant or provide lengthy explanations as to any error. Where non-redundant, non-frivolous issues are set forth in an appropriately concise manner, the number of errors raised will not alone be grounds for finding waiver.

(v) Each error identified in the [1925(b)] Statement will be deemed to include every subsidiary issue that was raised in the trial court . . . .

Pa. R.A.P. 1925(b)(4).

Here, the trial court ordered Hospital to file a 1925(b) Statement. Hospital filed a 1925(b) Statement that was 19 pages long with 43 numbered issues and 46 sub-issues in paragraph 43, for a total of 88 issues and sub-issues. Application to Dismiss, Ex. A. In its Rule 1925(a) Opinion, the trial court posited that Hospital violated Rule 1925(b)'s conciseness requirement. 1925(a) Op. at 3. Notably, the trial court expressly declared that the 1925(b) Statement's lack of conciseness hampered its issuance of the 1925(a) Opinion. Id.

Consistent with the trial court's Rule 1925(a) Opinion, the Board filed an application for relief in the form of a motion to dismiss the appeal. The Board argues that Hospital's failure to comply with Rule 1925(b) waived all issues. We agree.

In Eiser v. Brown & Williamson Tobacco Corp., a plurality of our Supreme Court opined that the number of issues in a 1925(b) statement should not, standing alone result in waiver. 938 A.2d 417, 427 n.16 (Pa. 2007). The current Rule 1925(b)(4)(iv)...