REDEVELOPMENT AUTH., PHILA. v. CITY OF HOPE N. MED. CTR., Civ. A. No. 74-2408.

• Decision Date: 31 October 1974
• Docket Number: Civ. A. No. 74-2408.
• Parties: REDEVELOPMENT AUTHORITY OF the CITY OF PHILADELPHIA v. CITY OF HOPE NATIONAL MEDICAL CENTER.
• Court: U.S. District Court — Eastern District of Pennsylvania

383 F. Supp. 813

REDEVELOPMENT AUTHORITY OF the CITY OF PHILADELPHIA v. CITY OF HOPE NATIONAL MEDICAL CENTER.

Civ. A. No. 74-2408.

United States District Court, E. D. Pennsylvania.

October 31, 1974.

Donald Strumph, Philadelphia, Pa., for plaintiff.

Harry Lore, Philadelphia, Pa., for defendant.

MEMORANDUM

GORBEY, District Judge.

Plaintiff, Redevelopment Authority of the City of Philadelphia, is an instrumentality of the City of Philadelphia, a municipal corporation of the Commonwealth of Pennsylvania. Plaintiff has filed a motion to remand to the Court of Common Pleas of Philadelphia County, the cause of action which had been removed to this court by the defendant, a California corporation.

The motion to remand is based upon the contention that this court lacks original jurisdiction because the amount in controversy is not in excess of $10,000 as required by 28 U.S.C. § 1332, although diversity of citizenship is conceded.

The petition for removal is accompanied by a surety bond as required by 28 U.S.C.A § 1446(d).

The action was commenced with no offer of compensation by plaintiff's petition for a writ of possession of premises 929 Filbert Street, 4th Floor, Philadelphia, Pennsylvania, defendant being in possession by virtue of a ten year lease which had seven years to go at the time plaintiff obtained title to the property by virtue of condemnation proceedings.

Plaintiff contends that the amount in controversy must be determined from the face of the complaint and no claim therein is made for damages.

Plaintiff, in support of its claim that the amount in controversy does not exceed $10,000 exclusive of interest and costs, points out that defendant by its answer sets up three items which it claims have an aggregate value in excess of $10,000: its seven year leasehold interest, fixtures, and dislocation damages under § 601-A(b)(3) of the Eminent Domain Code of Pennsylvania.

1. Plaintiff denies any liability on the ground that paragraph 22 of the lease which is attached as Exhibit "A" to plaintiff's supplemental memorandum of law in support of motion to remand provides that the lease shall terminate as of the date that title vests in the condemner. Scholls' Appeal, 292 Pa. 262, 141 A. 44 (1928).

2. Also, paragraph 9(d) of the lease provides inter alia that all alterations, improvements, additions or fixtures made by the defendant "shall remain upon the premises at the expiration of the lease or sooner determination of this lease and become the property of Lessor, unless Lessor shall, prior to the determination of this lease, have given written notice to the Lessee to remove the same in which case Lessee will remove such alterations . . .". (Emphasis added) Exhibit "A" to plaintiff's supplemental memorandum of law in support of motion to remand.

3. With respect to statutory business dislocation damages, plaintiff relies upon § 601-A(b)(3) of the Eminent Domain Code of Pennsylvania which provides for damages of not more than $10,000 if the business (i) cannot be relocated without a substantial loss of its existing patronage, and (ii) is not a part of a commercial enterprise having at least one other establishment not being acquired by the acquiring agency, which is engaged in the same or similar business. Plaintiff contends that the two conditions precedent cannot be satisfied. Therefore, no damages would be payable under this section.

The above three contentions have been met by the defendant's arguments as follows:

(1) While paragraph 9(d), the condemnation clause in the lease, is valid as between lessor and lessee, 2 Nichols, Eminent Domain, § 5.83 2 (1974 Ed.), it cannot constitutionally be enforced by the plaintiff against the tenant, under a line of cases including Shelley v. Kraemer, 334 U.S. 1, 68 S.Ct. 836, 92 L.Ed. 1161 (1948); Boddie v. Connecticut, 401 U.S. 371, 91 S.Ct. 780, 28 L.Ed.2d 113 (1971); Fuentes v. Shevin, 407 U.S. 67, 92 S.Ct. 1983, 32 L.Ed.2d 556 (1972); Stanley v. Illinois, 405 U.S. 645, 92 S.Ct. 1208, 31 L.Ed.2d 551 (1972); Goldberg v. Kelly, 397 U.S. 254, 90 S.Ct. 1011, 25 L.Ed.2d 287 (1970).

(2) Defendant, in response to plaintiff's reliance upon paragraph 9(d) and its assertion that the fixtures and improvements became the property of the lessor because lessor did not give written notice prior to determination of the lease, to the lessee to remove the same, contends that the condition precedent was satisfied as shown by the affidavit of Louis J. Solomon, Administrator of the program of the defendant, Medical Center.

Since the plaintiff obtained title to the property by declaration of taking filed on October 31, 1973, it would appear that it would be necessary to show that the written notice, if any, of the lessor was given to defendant prior to that date. An examination of the affidavit filed by the defendant with its Exhibit "A", a letter dated April 25, 1974, and signed by Alan J. Swates, representing the former owner, and addressed to the Redevelopment Authority of the City of Philadelphia stated:

"The

...