An Abuse of Power Case

The Township supervisors were incensed. A local developer had filed a declaration of condominium to convert a property with four homes on it into condominiums in a rural part of the Township.

The owner of the property previously rented out the houses to tenants and they all shared a common septic system. The property had been developed years before passage of a modern subdivision ordinance. The new ordinance required at least five acres per house. Because the property had been developed prior to the enactment of the ordinance, the owner had been exempted from the new five-acres-per house minimum requirement.

The local developer put the housing units up for sale. Two of the condos were sold before coming to the supervisors’ attention.

Through the Township’s attorneys, a letter was sent to warn the developer and condo buyers that they had violated the local ordinances. In the meantime, the remaining two condos were sold as well.

None of the condo owners believed that they had done anything wrong or illegal. They reached out to their title insurance companies for help. The title company for Mary Ball and John Ingram then hired Mike Bomstein to represent them in the lawsuit filed by the Township against them and the other condo owners.

The lawsuit falsely claimed that the developer and the owners had violated the local development ordinance by failing to have units containing at least five acres and also by failing to apply to the Township for permission to convert to condominiums. The homeowners, however, had done nothing of the sort. All they did was purchase homes from a developer. They had no idea there was a dispute between the Township and the developer.

The lawsuit falsely claimed that the owners’ use of their properties was improper even though their use as residences was exactly the same at that of the tenants who had lived there previously.

The lawsuit also claimed that the Pennsylvania condominium statute allowed it to require developers to file applications for development approval when converting to condo ownership. The law, however, does not require that. As an example, if a small apartment complex is converted to condo ownership and it is physically unchanged, the law is clear that no application needs to be filed with local authorities.

The owners’ most significant concern was that the Township was asking the trial judge to give up ownership of their homes because of an alleged violation by the developer. Mike Bomstein was outraged because this would be both unlawful and a violation of the owners’ constitutional right to due process of law.

As the suit got close to trial, the Township, the developer and the owners all filed motions for judgment, based on the undisputed facts of the case. For Bomstein’s clients, the stakes were high: It was all or nothing.

Within two months, the court rendered its decision. The judge ruled completely against the Township and in favor of the developer and the owners. The Township, however, still had a right to appeal and appeal they did.

All of the parties submitted briefs to the Commonwealth Court. A few months later, counsel argued the case before that court. In the end, the appeal judges ruled unanimously in favor of the developer as well as all of the owners.

The Commonwealth Court’s opinion held that the Township land development ordinance did not apply to properties developed prior to the date the ordinance went into effect. The Court also found that the condominium law made clear that the physical structure of the homes was the same after condo conversion as it was before conversion. Hence, the developer had not been required to take the steps prior to conversion that the Township insisted were required.

The Township “threw in the towel” after the Commonwealth Court decision was handed down. No further appeals were taken and Mike Bomstein’s clients were vindicated a second time.