Szabo v. Commonwealth, 46 WAP 2017

• Decision Date: 20 February 2019
• Docket Number: No. 46 WAP 2017,46 WAP 2017
• Parties: Stephen J. SZABO and Mary B. Szabo, Appellees v. Commonwealth of Pennsylvania, DEPARTMENT OF TRANSPORTATION, Appellant
• Court: Pennsylvania Supreme Court

202 A.3d 52

Stephen J. SZABO and Mary B. Szabo, Appellees
v.
Commonwealth of Pennsylvania, DEPARTMENT OF TRANSPORTATION, Appellant

No. 46 WAP 2017

Supreme Court of Pennsylvania.

Argued: April 11, 2018
Decided: February 20, 2019

OPINION ANNOUNCING THE JUDGMENT OF THE COURT

JUSTICE MUNDY

This appeal asks us to determine 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. §§ 101 - 1106 (Code). After careful review, we hold 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 we affirm the decision of the Commonwealth Court to

202 A.3d 54

remand the matter for an evidentiary hearing.

Appellees, Steven and Mary Szabo, own real property located at 3101 Washington Road, McMurry, Pennsylvania where they operate a hair salon and skin care business. The property, which abuts both Route 19 and Old Washington Road, is 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.

On January 10, 2013, after six months of negotiations, PennDOT served the Szabos with a declaration of taking for a 1.040 acre right of way, and a 1.729 acre temporary construction easement on Parcel 5, for the purpose of expanding State Route 19. Declaration of Taking Property Plan, 12/3/12 at Sheet 1 of 2. The plot plan stated that Parcel 5 had an effective size of 3.128 acres, and the declaration of taking marked the right of way seized from Parcel 5 as required under Section 305.¹

The plot plan served with the declaration also listed two adjacent parcels of land, Parcels 1 and 9. The owners of Parcel 1 were listed as Edward A. Courtney, Jr. and Susan H. Courtney, H & W (1/2 Interest) & Heirs of Eveline H. Roach; Being Bessie A. Fife Her Heirs and Assigns (1/2 Interest), and the owner of Parcel 9 was listed as The Home Rule Municipality of Peters Township. Id. at Sheet 1 of 2. Lines demarcating Parcel 5 from Parcels 1 and 9 were labeled "probable [sic] correct" and a property note indicated that "the Gerrick² plan, dated September 1996 ... was not used for the Szabo boundary lines." Id. The note described several errors discovered within the chain of title, including a distance line of 178.2 feet, mislabeled as 270 feet, and an unrecorded outsale to the Montour Railroad Company, which was then transferred to the Home Rule Municipality of Peters Township in 1985. Id. The lower portion of both plans stated the "private property lines are plotted from the deed of record," but noted those lines "were not surveyed by the professional land surveyor responsible for the project" and advised "this property plot is not to be substituted for a boundary survey." Id.

Importantly, the plot plans attached to the declaration of taking did not indicate that any portions of Parcels 1 and 9 were condemned. Moreover, the plot plan failed to illustrate that Parcel 1 was condemned on November 8, 2012, and Peters Township conveyed Parcel 9 to PennDOT by deed in lieu of condemnation, recorded on June 26, 2012. Thus, the Szabos were provided with notice solely of the portion of Parcel 5, which was correctly marked as owned by the Szabos, that was to be condemned.

Correspondence attached to the notice of condemnation advised the Szabos that they had the right to receive estimated just compensation for land taken from

202 A.3d 55

Parcel 5 in the amount of $ 587,000 and their acceptance of payment would in no way jeopardize their right to petition the court to appoint a board of viewers to determine the precise amount of compensation to which they were entitled. A memorandum of law attached to the declaration informed the Szabos they could, within 30 days, file preliminary objections to challenge the declaration of taking.³ Because the Szabos had no objection to the portion of Parcel 5 indicated as condemned, the Szabos did not file preliminary objections.

On April 8, 2013, PennDOT deposited $ 587,000 estimated just compensation with the Court of Common Pleas of Washington County (Trial Court). On December 12, 2013, the Szabos filed a petition for the appointment of viewers pursuant to Section 502⁴ to determine just compensation for the condemnation of Parcel 5. Petition for Evidentiary Hearing, 5/13/15, at ¶¶ 4-5. The trial court appointed a board of viewers and the Szabos requested and received their estimated just compensation of $ 587,000 from the trial court. A hearing before the board of viewers was scheduled for May 21, 2015.

On May 13, 2015, the Szabos asserted for the first time that the ownership interests provided in the declaration of taking were incorrect and filed a petition for an evidentiary hearing with the trial court. The petition informed the court that the Szabos had recently hired a registered surveyor to prepare a plan depicting their property. The surveyor's plan demonstrated that the plan attached to the declaration of taking was inaccurate in that it failed to show the entire property owned by the Szabos prior to condemnation. Petition for Evidentiary Hearing, 5/13/15, at ¶ 7. The Szabos notified PennDOT of the error, produced the survey prepared for them by the registered surveyor, offered to meet with PennDOT to demonstrate the results of the title search performed by the Commonwealth Land Title Company, and requested the official plan be changed. In response, PennDOT denied that its plans were erroneous, and all attempts at remedy failed. The Szabos therefore requested, "due to the issue of fact regarding the extent and nature of the property interest condemned and the owners thereof, an evidentiary hearing ... to resolve said issue." Id. at 9.

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In its answer to the petition, PennDOT admitted that while Section 504(d)(5)⁵ of the Code mandates that an evidentiary hearing be conducted by the court and not the board of viewers, it was inapplicable in this instance because Section 504(d)(5) does so only in the specific context in which issues are raised through preliminary objections. Further, PennDOT denied that the plans included with the declaration of taking were inaccurate, stating that strict proof is demanded at the time of hearing demonstrating ownership. Notwithstanding the request for proof, PennDOT argued that the trial court did not have jurisdiction to address the averments raised by the Szabos because the Szabos admittedly had not raised these issues within thirty days of service of the declaration of taking. Consequently, issues related to the extent and nature of the property interest condemned were waived under Section 306. The trial court directed the parties to file briefs.

In their brief to the trial court, the Szabos repeated that the plan did not adequately establish the extent or effect of the taking because it did not show the entirety of their property interests prior to the condemnation. Accordingly, they argued their claim should not be subject to waiver under Section 306.

PennDOT, in response, emphasized waiver under Section 306, and asserted that the trial court did not have jurisdiction over these issues because they had not been raised within thirty days of receipt of the declaration of taking. It stated "substantial prejudice" to the Department would result from raising an issue "which is so basic to the case" beyond the span of thirty days. Brief in Opposition to Plaintiffs' Petition for Evidentiary Hearing, 6/12/2015, at 8.

On August 17, 2015, the trial court denied the Szabos' Petition for Evidentiary Hearing. In ruling against the Szabos, the court noted that "there [was] no dispute as to what property PennDOT desire[d] to take -- the Szabos [did] not argue that the geographical boundaries of PennDOT's plan [were] ambiguous." Trial Ct. Op., 8/17/15, at 3. Further, the court concluded that "there [was] no dispute about the effect of the taking, i.e. what impact it would have on the remainder of the Szabos' property interest." Id. Characterizing a failure in "extent or effect" as fundamentally a question of notice to the landowner at the time the declaration is filed, and citing In re Commonwealth, Department of General Services , 714 A.2d 1159 (Pa. Cmwlth. 1998), and Commonwealth, Department of Transportation v. Greenfield Township-Property Owners , 135 Pa.Cmwlth. 113, 582 A.2d 41 (1990), the court concluded that the Szabos knew what property was being taken and did not allege the occurrence of some unanticipated consequence unknown to them at the time of the declaration, which would have explained the failure to file preliminary objections.⁶

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The Szabos filed a timely notice of appeal to the Commonwealth Court raising two assertions of error: "...