Opinion
No. 2269 C.D. 2012
03-17-2014
Condemnation by the Mercer Area School District of Mercer County for Acquisition of Land for School Purposes in the Borough of Mercer, Being the Lands of Kevin and Doreen Wright and Glenn and Edith Krofcheck Appeal of: Mercer Area School District
BEFORE: HONORABLE DAN PELLEGRINI, President Judge HONORABLE ROBERT SIMPSON, Judge HONORABLE PATRICIA A. McCULLOUGH, Judge OPINION NOT REPORTED MEMORANDUM OPINION BY JUDGE McCULLOUGH
Mercer Area School District (District) appeals the December 4, 2012 order of the Court of Common Pleas of Mercer County (trial court) sustaining the preliminary objections of Kevin and Doreen Wright, husband and wife, and Glen and Edith Krofcheck, husband and wife (collectively Landowners), and striking the District's declaration of taking. We reverse and remand for further proceedings.
This case involves two eminent domain actions filed by the District, the second of which was dismissed by the trial court on the basis of res judicata. In the first action (No. 2010-3837), the District filed a declaration of taking on October 14, 2010, pursuant to a September 20, 2010 resolution authorizing the taking of a .52 acre lot owned by Landowners. The lot was located at 398 South Shenango Street, Mercer County, and contained an occupied, single-family dwelling. According to the resolution, the purpose of the taking was to expand the District's driveways for its educational programs and to improve emergency ingress and egress from District property. Similarly, the declaration of taking stated that the condemnation was "to acquire property for expansion of the District's current facilities and to provide emergency access to current District owned property." (Trial court op., 12/7/2011, at 3; Reproduced Record (R.R.) at 363a.) Beginning on November 30, 2010, Landowners filed a variety of preliminary objections and later amended preliminary objections to the declaration, and the trial court received deposition transcripts and documentary evidence to decide these objections. (Trial court op., 12/7/2011, at 3-4; R.R. at 363a-64a.)
By opinion and order dated December 7, 2011, the trial court granted Landowners' preliminary objections, determining that the District's proposed taking was excessive, done in bad faith, and constituted an abuse of discretion. The trial court concluded that the District abused its discretion in "moving too quickly and without adequate preparation when voting" to pass the resolution authorizing the taking. (Trial court op., 12/7/2011, at 19; R.R. at 379a.) Specifically, the trial court found that the District's board members did not review any plans, drawings, or maps prior to the vote; failed to consult an expert, such as an engineer or the Department of Transportation (DOT), to determine where the access road should be located on the property; and did not conduct an investigation to determine how much land was needed for the emergency access. In addition, the trial court found that there were no tangible plans to indicate how the land would be used within a reasonable time; explain how the District would acquire an easement to connect adjacent streets; or demonstrate how the District would obtain the legal rights to a 25-foot driveway owned by Landowners that was necessary to complete the access road, but was not listed for condemnation in either the resolution or the declaration. Finally, the trial court found that the District's board members lacked an "informed perception" because they did not express any questions or concerns prior to the vote and were unable to identify on a map the property they had just voted to take; rather, the board members' decision was based solely on the recommendation of the District's Superintendent and Solicitor who advised that there was nothing illegal about taking the property. (Trial court op., 12/7/2011, at 19-21; R.R. at 379a-81a.)
Significantly, in making its observation concerning the board members' failure to conduct due diligence, the trial court stated in footnote 13 of its opinion that:
It is clear that upon reading the depositions, each was relying on someone else's work to assess whether the requirements for condemnation had been met. It is clear to this [c]ourt, however, that the requirements for condemnation have not been met. It is the suggestion of the [c]ourt that if the [District] still desires to develop the [property, the District] do the following: conduct a cost-benefit analysis of the proposed project, consult with an engineer or [DOT] to more accurately estimate how much land would be needed for the project, estimate the width of the new road, plan where the driveway will be located on the lot, estimate the cost of clearing the land, pursue a right-of-way and/or easement . . . before condemning the subject property, etc. These suggestions are intended to serve as a guide and are not an exhaustive list of requirements.(Trial court op., 12/7/2011, at 23 n.13; R.R. at 383a) (emphasis supplied).
Accompanying the trial court's opinion was an order granting Landowners' preliminary objections. (Order, 12/7/2011; R.R. at 384a.) Landowners then filed a petition for special relief seeking an order vesting title to the property back to them. (R.R. at 389a.) In turn, the District filed an answer seeking, among other things, permission to amend its declaration to conform to the requirements set forth in the trial court's December 7, 2011 opinion and/or permission "to amend its initial condemnation resolution." (R.R. 423a-24a.) By order dated January 6, 2012, the trial court granted Landowners' requested relief and, through necessary implication, denied the District's answer and requests to amend. (R.R. at 427a-28a.) Thereafter, the District did not file an appeal to this Court.
On May 2, 2012, the District commenced a second action (No. 2012-662), by filing a declaration of taking pursuant to a new resolution adopted on February 27, 2012. The property sought to be condemned was Lot No. 1 in the Elsie Ferry Subdivision recorded at 1994 P.L. 4319-42, together with a strip of land and a driveway, totaling approximately 1.83 acres, with a mailing address of 398 South Shenango Street. As in the first action, Landowners were the owners of this property. According to the resolution and declaration of taking, the purpose of the taking "is to acquire property for emergency and/or improved access and egress to current District owned property, and for the expansion of the District's current parking facilities." (Trial court op., 12/4/2012, at 1-2.)
Landowners filed preliminary objections, asserting, among other things, that the District's second attempt to condemn their property was barred by res judicata. In response, the District argued, among other things, that res judicata did not apply because it cured all of the substantial defects outlined in the trial court's December 7, 2011 opinion. Moreover, by providing guidance as to the future development of the initially condemned property, the District contended that res judicata was inapplicable because the trial court's December 7, 2011 opinion effectively acknowledged that the District had a right to file a second declaration of taking if it fixed the deficiencies stated in that opinion. Further, the District argued that it did not extinguish its cause of action and/or that there was a change in circumstances sufficient to preclude application of res judicata. (Trial court op., 12/4/2012, at 2, 4; R.R. at 468a-69a, 510a-11a, 514a-15a.)
By order dated December 4, 2012, the trial court granted Landowners' preliminary objections on grounds of res judicata and struck the declaration of taking. In so doing, the trial court concluded that all of the elements for res judicata were met, "with a few minor exceptions," and that the first action constituted a final judgment on the merits. The trial court also emphasized the fact that the District "did not file any formal motion seeking leave of court to file another [d]eclaration of [t]aking after they had cured any of the defects listed in the [December 7, 2011] opinion." (Trial court op., 12/4/2012, at 4-5, 8) (emphasis added).
On appeal, the District raises numerous arguments as to why res judicata should not bar its second eminent domain action. One of the District's contentions is that res judicata is inapplicable because footnote 13 of the trial court's December 7, 2011 opinion recognized that the District had a right to file a second declaration and effectively granted them permission to do so. We agree.
In an eminent domain proceeding where a trial court has sustained preliminary objections to a declaration of taking, this Court's scope of review is limited to determining whether the trial court abused its discretion, committed an error of law, or whether the findings and conclusions are supported by substantial evidence. Condemnation by Valley Rural Electric Co-op., Inc. v. Shanholtzer, 982 A.2d 566, 570 n.4 (Pa. Cmwlth. 2009).
As a general principle, the doctrine of res judicata (otherwise known as claim preclusion) can operate to bar a condemnor from filing successive eminent domain actions. See Northwestern Lehigh School District v. Agriculture Lands Condemnation Approval Board, 578 A.2d 614, 617 (Pa. Cmwlth. 1990) (applying res judicata to bar successive approval applications for condemnation of property under the Agricultural Security Law). See also Oakes Municipal Airport Authority v. Wiese, 265 N.W.2d 697, 701 (N.D. 1978). To be applicable, "res judicata requires the existence of four elements: (1) identity of the thing sued for; (2) identity of the cause of action; (3) identity of persons and parties to the action; and (4) identity of the quality or capacity of the parties suing or being sued." Northwestern Lehigh School District, 578 A.2d at 617.
Act of June 30, 1981, P.L. 128, as amended, 3 Pa.C.S. §§901--915.
However, even if all the elements of res judicata are met, res judicata will not prohibit a second action where a trial court's order or opinion dismissing the first action indicates the court's intent to permit the plaintiff to bring a second action. For example, the Restatement (Second) of Judgments §26(1)(b) (1982) states that res judicata will not extinguish a claim where "[t]he court in the first action has expressly reserved the plaintiff's right to maintain the second action." Id. The comment to this subsection provides as an illustration the situation in which a trial court dismisses an action "without prejudice" and states that the term "without prejudice," or words to that effect, are sufficient to permit the filing of a second action. Id., Comment; accord Robinson v. Trenton Dressed Poultry Company, 496 A.2d 1240, 1243 (Pa. Super. 1985); Venuto v. Witco Corp., 117 F.3d 754, 758-59 (3d Cir. 1997).
On a variety of occasions, Pennsylvania courts have looked to and relied upon the Restatement of Judgments when defining the parameters and preclusive effect of res judicata or collateral estoppel. See, e.g., Shaffer v. Smith, 543 Pa. 526, 530-31, 673 A.2d 872, 875 (1996); Pilgrim Food Products Company v. Filler Products, Inc., 393 Pa. 418, 421-22, 143 A.2d 47, 49 (1958); Clark v. Pfizer Inc., 990 A.2d 17, 31-32 (Pa. Super. 2010); McArdle v. Tronetti, 627 A.2d 1219, 1223 (Pa. Super. 1993).
Quoting an authoritative treatise, the United States Court of Appeals for the Third Circuit further explained: "A judgment that expressly leaves open the opportunity to bring a second action on specified parts of the claim or cause of action that was advanced in the first action should be effective to forestall preclusion." Venuto, 117 F.3d at 759 n.9 (quoting 18 Wright, Miller, and Cooper, Federal Practice and Procedure, §4413, at 106). Additionally, the Supreme Court of Iowa has held that "[a] clear signal from a court that it did not intend its decision to have preclusive effect on a specific claim should be honored, even if that signal arguably does not amount to an 'express reservation.'" Lambert v. Iowa Department of Transportation, 804 N.W.2d 253, 259 (Iowa 2011).
In City of Chicago v. Midland Smelting Co., 896 N.E.2d 364 (Ill. App. Ct. 1st Dist. 2008), the city council passed an ordinance authorizing the City of Chicago to acquire an entire parcel of property, the City filed a complaint to condemn the property, and the landowner filed a motion to dismiss, contending that the condemnation was unnecessary and an excessive taking for private use. Although the circuit court found that it was necessary for the City to acquire the property, the circuit court also found that the City abused its authority by seeking to condemn all of the property because only the northern portion, or approximately one-half of the property, needed to be condemned to achieve the stated purpose. In addition, the circuit court denied, without comment, the City's attempt to amend its complaint to reflect that it was only seeking acquisition of the northern portion of the property. Presumably, the circuit court did so because the City lacked an ordinance at that time specifically authorizing it to condemn less than all of the property and, therefore, the City could not cure the excessiveness defect without passing a new ordinance. In dismissing the action on the ground that the proposed taking was excessive, the circuit court stated in its order that "this is a matter that the City can correct." 896 N.E.2d at 372.
Thereafter, the city council in Midland Smelting Co. passed a resolution authorizing the City to acquire the northern portion of the property, and the City filed a second condemnation action. In response, the landowner raised the defense of res judicata, claiming that the City could have sought to condemn only the northern portion of the property in the first lawsuit. The circuit court concluded that the City's second action sought to condemn the northern portion of the property in order to "address the defect [the court] previously found." 896 N.E.2d at 373. The circuit court further determined that "implicit in [the court's] previous rulings . . . was the right of the City to cure its defect of an excessive taking by reducing the amount of property to be acquired." Id. For these reasons, the circuit court concluded that res judicata did not apply and that the City could proceed on its second condemnation action.
On appeal, the Illinois Court of Appeals, citing the Restatement (Second) of Judgments §26(1)(b), affirmed the circuit court's conclusion that res judicata did not bar the City's second action. In so holding, the intermediate appellate court in Midland Smelting Co. noted that in the first action, the City attempted to amend its complaint in order to seek condemnation of the northern portion of the property only, but an amendment would have been futile because the City would have had to pass a new ordinance. The appeals court also interpreted the circuit court's statement in its dismissal order that the excessive taking was a "matter that the City can correct." According to the appeals court, this language had the practical effect of dismissing "the case with the intention of reserving the City's right to file a complaint for half of the [property] after it had obtained an ordinance allowing it to do so." 896 N.E.2d at 373. From these premises, the appeals court found that the City commenced the second action "specifically pursuant to the [circuit] court's order dismissing the prior lawsuit" and ultimately concluded that "[t]o apply res judicata under these circumstances . . . would effectively punish the City for its reliance upon the court's ruling." Id. at 382.
Here, the trial court in the first action found that the District's board members abused their discretion and failed to make an informed decision when they passed the September 20, 2010 resolution authorizing the taking of Landowners' property. Footnote 13 of the trial court's December 7, 2011 opinion reflects the court's intention to permit the District to file another declaration of taking when the defects were cured. Specifically, the trial court's intention is made clear by the language contained in the footnote, which is expressed through a conditional, correlative conjunction; i.e., if the District wants or "desires" to file another eminent domain action, then it must/should do the following ... "before condemning the subject property." The District's right to commence a second eminent domain action is an absolute and necessary predicate to this conjunction. Therefore, by its very language, footnote 13 adequately reserved to the District the right to file a second condemnation action. See Midland Smelting Co., 896 N.E.2d at 373 & 382. See also Lambert, 804 N.W.2d at 259-60 (concluding that opinion's language sufficiently reserved the plaintiff's right to file an action in mandamus to compel condemnation proceedings where the opinion and order granted the defendant's motion to dismiss the action at law but implicitly contemplated that the mandamus claim would be preserved).
Additionally, the District sought leave to amend its declaration and resolution in the first eminent domain action in order to correct the errors pointed out by the trial court in its December 7, 2011 opinion. However, the trial court denied the District's request without discussion, ostensibly because the District could only cure the defects if its board members passed a new resolution and filed a new declaration of taking. The District relied upon the trial court's instructions in footnote 13 and later passed a new resolution, purporting to rectify the flaws identified by the trial court in its opinion in the first action. Because the trial court denied the District leave to amend its declaration and resolution in the first action, after providing the District with detailed guidance and instructions in order to institute a second action, we conclude that the trial court adequately reserved to the District the right to file a second action, so long as the District attempted to fulfill the conditions stated in footnote 13. Were this Court to hold otherwise, the trial court's instructions would be rendered meaningless, and the efforts that the District made in reliance upon those instructions reduced to an exercise in futility.
Our conclusion is buttressed by the fact that in its opinion in the second eminent domain action, the trial court never disclaimed the District's argument that the December 7, 2011 opinion reserved the District's right to institute a subsequent action. Instead, the trial court found in its second opinion that, after the District followed the instructions in the December 7, 2011 opinion, the District had to file a formal motion seeking leave of court before it could file a second action. (Trial court op., 12/4/2012, at 4.) In so doing, the trial court impliedly acknowledged that the District had a reserved right to institute a second action -- but only if the District first obtained formal leave.
However, it was unnecessary for the District to obtain leave of court to file another declaration if it cured the defects highlighted in the December 7, 2011 opinion. This is because the trial court's opinion effectively granted Landowners' preliminary objections "without prejudice" to the District filing a second eminent domain action when and if the District's board members passed a resolution that reflected an informed decision. See Robinson, 496 A.2d at 1243 (concluding that where the trial court dismisses an action "without prejudice," it is unnecessary for a plaintiff to obtain permission or leave of court to file another action), and compare with McCarter v. Mitcham, 693 F. Supp. 349, 351 (W.D. Pa. 1988) (concluding that where a case is dismissed with prejudice and "no further litigation of the matter is contemplated or permitted," a second suit may not be brought without leave of court and for good cause shown). Because the trial court's opinion reserved the District's right to commence a second action, and there was no requirement in that opinion stating that a motion for leave was a condition precedent to filing a second action, the District was not obligated to seek and secure formal leave before filing the second action.
Landowners, nonetheless, contend that the trial court's statements to the District lack legal significance because they were contained in a footnote rather than in the body of the opinion or in an order.
Although this issue has not been squarely addressed by Pennsylvania case law, the courts of foreign jurisdictions are seemingly unanimous in concluding that a holding expressed in a footnote is as much of a judicial opinion as the opinion's text or order, and that a footnote has precedential value so long as it does not pronounce dicta . In In the Interest of L.J., ___ Pa. ___, ___, 79 A.3d 1073, 1078-80 (2013), our Supreme Court endorsed this view, sub silentio, when it analyzed a footnote in Commonwealth v. Chacko, 500 Pa. 571, 459 A.2d 311 (1983), to determine whether that footnote was non-binding dicta under the doctrine of stare decisis. If the statements in the Chacko footnote were to be interpreted as inherently worthless and incapable of possessing precedential value solely on the basis that they were contained in a footnote, the Court in In the Interest of L.J. would not have engaged in this type of substantive legal analysis. In Commonwealth v. Barnett, 25 A.3d 371, 374 (Pa. Super. 2011) (en banc), the Superior Court concluded that a footnote in our Supreme Court's decision in Commonwealth v. Wright, 599 Pa. 270, 961 A.2d 119 (2008), was binding precedent because a majority of participating justices "joined in footnote 22." Id.
See, e.g., Board of Education of the City School District of the City of Olean, 777 F.2d 837, 841-42 (2d Cir. 1985) (concluding that language in a footnote is binding so long as it is not dicta); Gray v. Union Joint Stock Land Bank, 105 F.2d 275, 279 (6th Cir.), rev'd on other grounds, 308 U.S. 523 (1939) (holding that "while a footnote may sometimes make [an opinion] chaotic and bewildering, it is as much a part of it as that in the body."); Allison v. AEW Capitol Mgmt., L.L.P., 751 N.W.2d 8, 17-18 (Mich. 2008) (concluding that language in a footnote is binding so long as it is not dicta); Fuessenich v. DiNardo, 487 A.2d 514, 521 n.8 (Conn. 1985) ("A footnote has the same binding force and effect as the language contained in the body of the opinion."); Melancon v. Walt Disney Productions, 273 P.2d 560, 562 n.2 (Cal. Ct. App. 2d Dist. 1954) (citing 21 C.J.S., Courts §221) ("There is no merit in plaintiff's contention made at the oral argument that the ruling of the Supreme Court was not binding since it appeared in the footnote in the opinion. A footnote is as important a part of an opinion as the matter contained in the body of the opinion and has like binding force and effect."); Robert A. James, Are Footnotes in Opinions Given Full Precedential Effect?, 2 Green Bag 2d 267 (1999) (discussing cases).
For example, in Mercury Interactive Corp. v. Klein, 70 Cal. Rptr. 3d 88, 99 (Cal. Ct. App. 6th Dist. 2007), the appellee argued that two cases should not be considered authoritative and binding because the holdings in those cases "appeared in footnotes in the opinions. Id. A California intermediate appellate court disagreed, concluding that "[t]he placement of the text expressing those holdings in footnotes does not negate their authoritative nature." Id.
Moreover, our Supreme Court has stated that the doctrine of stare decisis "only applies to issues actually raised, argued and adjudicated, and only where the decision was necessary to the determination of the case. The doctrine is limited to actual determinations in respect to litigated and necessarily decided questions, and is not applicable to dicta or obiter dicta." In the Interest of L.J., ___ Pa. at ___, 79 A.3d at 1081. In In the Interest of L.J., the Supreme Court held that the doctrine of stare decisis did not apply to the Chacko footnote because the footnote "was not necessary to the outcome of the case." Id. Instead, the Court concluded that the statements in the Chacko footnote were non-binding dictum because the majority in Chacko "simply volunteered the discussion" and "the issue was not litigated by the parties." Id.
Here, based upon a plain reading, it is clear from footnote 13's text that the trial court was directing the District how to file a second declaration of taking and that it was not rendering gratuitous statements of dictum. The trial court's analysis in footnote 13 directly addressed the merits of the first action, discussing the very issues that were litigated by the parties and explaining how the District abused its discretion in seeking to condemn the property. Further, by reserving to the District a right to institute a second action, footnote 13 cannot be deemed unnecessary to the trial court's disposition of the eminent domain action and the District's attempt to condemn Landowner's property. Rather, footnote 13 adjudicated the substantive rights of the District, outlining the path for the District to commence a second action and effectively permitting a second action to proceed at a later date when and if the District cured the defects that caused the first action to fail. Pursuant to the above- referenced case law, the trial court's instructions in footnote 13 were not dictum., and they had the legal effect of reserving to the District the right to commence a second action, despite being contained in a footnote as opposed to the text of the opinion.
Landowners also argue that this Court should pay deference to the trial court on the ground that the trial court, in the second action, interpreted the footnote in its first opinion as not reserving to the District a right to file a subsequent action. We disagree. There is nothing in the record or the trial court's opinion in the second action to suggest that the trial court interpreted its previous opinion and concluded that it did not reserve to the District a right to institute a subsequent action. Rather, as explained above, the trial court required, albeit erroneously, the District to seek and obtain formal leave after it cured the deficiencies. Moreover, even if the trial court construed its opinion in such a manner, this construction would be at odds with the unambiguous language of the opinion and the trial court's apparent intention of permitting the District to file a second eminent domain action. Therefore, we find no merit in Landowners' arguments.
For the above-stated reasons, we conclude that footnote 13 in the trial court's opinion in the first action adequately reserved to the District the right to bring the second action and provided instruction to the District as to how to accomplish the same. Accordingly, we reverse and remand for further proceedings. Due to our disposition, we need not address the District's remaining arguments pertaining to the substantive elements and application of res judicata.
/s/_________
PATRICIA A. McCULLOUGH, Judge ORDER
AND NOW, this 17th day of March, 2014, the December 4, 2012 order of the Court of Common Pleas of Mercer County is reversed and the case is remanded for further proceedings.
Jurisdiction relinquished.
/s/_________
PATRICIA A. McCULLOUGH, Judge