Opinion
July 29, 1975.
Zoning — Challenge to approved development plan — Petition to require bond — Pennsylvania Municipalities Planning Code, Act 1968, July 31, P.L. 805 — Due process — Equal protection — Discretion of court — Amount of bond — Stay of development — Waiver of stay — Interrogatories — Pa. R.C.P. No. 4007(a) — Relevance.
1. Under the Pennsylvania Municipalities Code, Act 1968, July 31, P.L. 805, when a challenge is filed with a zoning hearing board to a development plan which has been duly approved, the applicant for the approval of the plan may petition the court to require the protestants to post a bond and such a procedure is not violative of constitutional due process or equal protection of law principles. [510-1-2]
2. The granting of a petition requiring a protestant to post a bond under the Pennsylvania Municipalities Planning Code, Act 1968, July 31, P.L. 805, and the amount of such bond rests with the sound discretion of the court based on a determination of the reasonably anticipated damages which delay will cause the landowner to suffer, without reference to the merits of the challenge or the protestant's financial ability to post a bond. [510-1-2]
3. In determining the appropriate amount of a bond to require where an approved development plan is challenged, a court may properly consider such factors as interest carrying costs, the effect of inflation on labor and material costs, loss of options and rent and costs of refinancing and reordering. [512-3]
4. The requirement of the Pennsylvania Municipalities Code, Act 1968, July 31, P.L. 805, that continued work on an approved development plan be stayed when a challenge thereto is filed with a zoning hearing board is mandatory and cannot be waived. [513]
5. It is proper under Pa. R.C.P. No. 4007(a) to quash interrogatories filed in a proceeding to require the posting of a bond when a zoning appeal was taken, when the interrogatories related to the merits of the zoning appeal and were not relevant to the bond posting proceeding. [513]
Judge ROGERS dissented.
Submitted on briefs to President Judge BOWMAN and Judges CRUMLISH, JR., KRAMER, WILKINSON, JR., MENCER, ROGERS and BLATT.
Appeal, No. 292 C.D. 1975, from the Order of the Court of Common Pleas of Lehigh County in case of In Re: Appeal of Joseph A. Hercek, Sheila Stasko, and The Lehigh Valley Environmental Federation to Whitehall Township Zoning Hearing Board, No. 119 April Term, 1975.
Building permits issued for construction under development plan. Protestants appealed to the Zoning Hearing Board of Whitehall Township. Petition to require bond filed by property owner in the Court of Common Pleas of Lehigh County. Petition granted. Bond ordered. COYNE, J. Protestants appealed to the Commonwealth Court of Pennsylvania. Held: Affirmed.
Malcolm J. Gross, with him Paul A. McGinley, Jr., Carol K. McGinley, and Gross Brown, for appellants.
Howard Gittis, with him Ian A. L. Strogatz and, of counsel, Wolf, Block, Schorr and Solis-Cohen, for appellee.
On December 10, 1974, appellee was issued two building permits for the construction of a shopping mall and parking lot in Whitehall Township. An appeal was duly taken by appellants herein to the Zoning Hearing Board of Whitehall Township challenging the validity of these permits as well as the preliminary approval for site work and erosion control previously granted in November of 1974. Appellee then filed a petition to post bond under Section 916 of the Pennsylvania Municipalities Planning Code, Act of July 31, 1968, P.L. 805, 53 P. S. § 10916. On February 11, 1975, the Court of Common Pleas of Lehigh County ordered appellants, as a condition to continuing their appeal before the zoning board, to post bond in the amount of $10,000.00 within six (6) days, with additional monthly increments totalling $750,000.00 to compensate appellee for damages arising from the delay in the completion of the project necessitated by the appeal. When appellants failed to post the first stage of the bond, their appeal to the zoning board was dismissed, and this appeal followed.
Section 916 provides:
"Upon filing of any proceeding referred to in section 914 and during its pendency before the board all land development pursuant to any challenged ordinance, order or approval of the zoning officer or of any agency or body, and all official action thereunder shall be stayed unless the zoning officer or any other appropriate agency or body certifies to the board facts indicating that such stay would cause imminent peril to life or property, in which case the development or official action shall not be stayed otherwise than by a restraining order, which may be granted by the board or by the court having jurisdiction of zoning appeals on petition after notice to the zoning officer or other appropriate agency or body. When an application for development, preliminary or final, has been duly approved and proceedings designed to reverse or limit the approval are filed with the board by persons other than the applicant, the applicant may petition the court having jurisdiction of zoning appeals to order such persons to post bond as a condition of continuing the proceedings before the board. The question whether or not such petition should be granted and the amount of the bond shall be within the sound discretion of the court."
In Driscoll v. Plymouth Township, 13 Pa. Commonwealth Co. 404, 320 A.2d 444 (1974), this Court held that Section 916 does not violate due process or equal protection of law, the same constitutional challenges raised here. Driscoll further holds that in a Section 916 proceeding the lower court's inquiry is limited to a determination of the reasonably anticipated damages a landowner will suffer as the result of the delay caused by the protestant's appeal to the zoning board. Neither the underlying merits of the appeal nor the protestants' financial ability to post bond are relevant to this inquiry. Driscoll was recently followed in Orleans v. Melrose Park Improvement Association, 18 Pa. Commw. 185, 335 A.2d 851 (1975), where Section 916 was held applicable to an appeal from a favorable preliminary opinion of a development plan by a zoning officer under Section 1005(b) of the Code, 53 P. S. § 11005(b). Appellants attempt to distinguish Driscoll and Orleans by arguing that appellee failed to record its approved final development plan within ninety (90) days as required by the local ordinance; and, therefore, the plan was not "duly approved" within the meaning of Section 916, and their appeal would not operate so as to "reverse or limit" an approval which was, in effect, a nullity. It is clear to us that this allegation of a procedural defect in the recording of the plan is properly for the zoning board's consideration in the first instance, and since it raises a question going to the underlying merits of the appeal, the lower court did not commit an abuse of discretion in refusing to consider it.
Nor do we find that the lower court abused its discretion in setting the amount of bond. The record establishes that the interest carrying costs alone on the project amount to $2,330.00 per day, or approximately $70,000.00 per month. Calculated upon an annual inflation factor of 12% prevailing in the area construction industry, the cost of material and labor was estimated to increase $75,000.00 per month. Faced with the delay occasioned by the appeal, appellee was forced to cancel — at an option cost of $5,000.00 — a structural steel order it had placed before the appeal, and which will cost an additional $80,000.00 to reorder. Given this evidence, and other testimony of potential delay damages relating to the cost of refinancing the entire project and the loss of rent from prospective tenants, we can only hold that the first stage bond of $10,000.00 not posted by appellants, was within the court's statutory discretion.
Appellant contend that these costs cannot be attributed to the appeal delay since appellee continued to perform site work after the appeal was taken, and appellants agreed to waive the automatic stay provision of Section 916 if, concomitantly, no bond were required. The continuing work, however, was performed pursuant to a certification by the township zoning officer under Section 916 in order to prevent erosion and water runoff which threatened adjacent properties and resulted from site work performed under the prior approvals before notice of the appeal. The evidence establishes that appellee's delay costs were not attributed to this work, but to other grading and fabricating work which was foreclosed by the pendency of the appeal. As to the attempted waiver of the stay of development provision of Section 916, we agree with appellee that this provision is mandatory and the protection afforded thereby extends beyond the interests of the particular appellant before the zoning board so as to preclude its amicable waiver.
Finally, we cannot agree that the lower court erred in striking appellant's set of interrogatories directed to appellee prior to the hearing on the petition to post bond. The trial court is given broad discretion in this respect. A review of the interrogatories reveals that most relate to the underlying merits of the appeal which, as we have previously indicated, were not relevant to the Section 916 proceeding. Therefore, under Pa. R.C.P. 4007(a), the lower court properly exercised its discretion in quashing these interrogatories.
Order affirmed.
Judge ROGERS dissents.