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COMMONWEALTH PENNSYLVANIA v. MONUMENTAL PROPERTIES (11/07/73)

decided: November 7, 1973.

COMMONWEALTH OF PENNSYLVANIA, BY J. SHANE CREAMER, ATTORNEY GENERAL, PLAINTIFF,
v.
MONUMENTAL PROPERTIES, INC., CAPITAL HOUSING CORPORATION, EXECUTIVE HOUSE, INC., PROPERTY MANAGEMENT, INC., SAMUEL ELGART, INC., FRANK STEIN, ALBERT KAYTES, HARRY B. DAVIS, DONALD YOST REAL ESTATE COMPANY, MILLER BROS. & COMPANY, WILLIAM B. HOLLINGER & SON, BENJAMIN VOLK, MARKS & COMPANY, DEVON-STRAFFORD COMPANY, C. PAT RILEY, ROBERT E. PLANK, GRIEST REALTY COMPANY, MEDIA REAL ESTATE COMPANY, LORI INCORPORATED, J.J. GUMBURG COMPANY, WASHINGTON PLAZA, INC., PENNDALE TOWERS, INC., SANIEL-ELKIND REAL ESTATE CO., SPIRO REALTY COMPANY, TALENFELD REAL ESTATE CO., JOHN C. CLARK COMPANY, YEO & LUKENS COMPANY, G.S. ROCKEY COMPANY, AND P.O. NALY COMPANY, DEFENDANTS



Original jurisdiction in case of Commonwealth of Pennsylvania, by J. Shane Creamer, Attorney General, v. Monumental Properties, Inc., Capital Housing Corporation, Executive House, Inc., Property Management, Inc., Samuel Elgart, Inc., Frank Stein, Albert Kaytes, Harry B. Davis, Donald Yost Real Estate Company, Miller Bros. & Company, William B. Hollinger & Son, Benjamin Volk, Marks & Company, Devon-Strafford Company, C. Pat Riley, Robert E. Plank, Griest Realty Company, Media Real Estate Company, Lori Incorporated, J.J. Gumburg Company, Washington Plaza, Inc., Penndale Towers, Inc., Saniel-Elkind Real Estate Co., Spiro Realty Company, Talenfeld Real Estate Co., John C. Clark Company, Yeo & Lukens Company, G.S. Rockey Company, and P.O. Naly Company.

COUNSEL

Lawrence Silver, Deputy Attorney General, with him David Kurtz, Deputy Attorney General, and Israel Packel, Attorney General, for plaintiff.

Patricia F. Kemp, with her Rod J. Pera, and McNees, Wallace & Nurick, for defendants, Monumental Properties, Inc. and Property Management, Inc.

Walter H. Compton, for defendant, Capital Housing Corporation.

Myron B. Markel, for defendant, Saniel-Elkind Real Estate Co.

Lee C. Swartz, with him Hepford, Zimmerman & Swartz, for defendants, G.S. Rockey Company, Miller Bros. & Company and Donald Yost Real Estate Company.

Patrick M. O'Donnell, for defendant, Penndale Towers, Inc.

Milton S. Lazaroff, for defendant, Devon-Strafford Company.

Joseph A. Klein, for defendant, William B. Hollinger & Son.

Robert G. Sable, with him John P. Klee, and Baskin, Boreman, Wilner, Sachs, Gondelman & Craig, for defendant, P.O. Naly Company.

Irving L. Mazer, with him Oscar Spivack and Spivack & Dranoff, for defendant, Yeo & Lukens Company.

Samuel Lander, for defendant, John C. Clark Company.

Harry B. Yost, with him Hassel & Yost, for defendants, C. Pat Riley and Robert E. Plank.

John Havas, with him Charles B. Zwally and Shearer, Mette, Hoerner & Woodside, for defendants, Executive House, Inc., C. Pat Riley and Robert E. Plank.

Norman L. Haase, with him Fronefield, deFuria & Petrikin, for defendant, Harry Davis.

Samuel P. Kamin, for defendant, Spiro Realty Company.

G. W. Wilde, for defendant, J.J. Gumburg Company.

Andrew Flash, with him Herbert A. Fogel, for defendant, Marks & Company.

Arnold R. Lieberman, for defendant, Albert J. Kaytes.

Edward D. Marks, for defendant, Washington Plaza, Inc.

Thomas M. Kittredge, for defendant, Media Real Estate Company.

President Judge Bowman and Judges Crumlish, Jr., Kramer, Mencer, Rogers and Blatt. Judge Wilkinson, Jr. did not participate. Opinion by Judge Kramer.

Author: Kramer

[ 10 Pa. Commw. Page 600]

This matter comes within the original jurisdiction of this Court and is before us on preliminary objections. The case was initiated by the Commonwealth of Pennsylvania, by its then Attorney General, J. Shane Creamer (hereinafter referred to as Commonwealth), under the Unfair Trade Practices and Consumer Protection Law, Act of December 17, 1968, P.L. 1224, as amended, 73 P.S. § 201-1 et seq. (hereinafter referred to as the Act), seeking to enjoin alleged violations of the Act. Twenty-five individuals and companies, alleged to be engaged in the business of leasing dwellings, including apartments, and four companies alleged to be engaged in the business of selling "legal forms," including "leases," are named as defendants.

We first observe that the allegations of the complaint are deceptively and unfairly general. In essence,

[ 10 Pa. Commw. Page 601]

    the Commonwealth treats all of the defendant landlords as if they were but one defendant. By pleading what in reality are conclusions of law, the Commonwealth alleges that these defendants have violated the Act by utilizing "certain lease agreements which in whole and in part are unlawful, unconstitutional, unenforceable, unconscionable, unfair, unclear, deceptive and misrepresent the respective rights and obligations of the parties to said agreements and constitute agreements of adhesion." The defendant form sellers are likewise lumped together and charged with violation of the Act in the alleged selling of the lease form agreements, which are characterized in the complaint with the same adjectives quoted immediately above in connection with the defendant landlords. There are no specific allegations of violation by any particular defendant.

Although Section 6 of the Act (73 P.S. § 201-6) provides an exclusive and effective means for the Attorney General to investigate, obtain information and discover facts prior to the bringing of a lawsuit under the Act, the Commonwealth filed, simultaneously with its complaint, a Motion for the Production of Documents. After the filing of objections and answers to the Motion by some of the defendants, a hearing was held before President Judge James S. Bowman of this Court. The President Judge entered an Order on February 21, 1973, resolving the matter wherein the defendant landlords were ordered to submit to the Commonwealth unexecuted copies of each of its form of lease contracts. The point in mentioning this procedural matter is to highlight the fact that the Commonwealth, in its complaint, failed to comply with the Pennsylvania Rule of Civil Procedure No. 1019(h) by failing to attach to the complaint a copy of any lease, or any part thereof, or making an averment that such written material was not available to the Commonwealth. As the President

[ 10 Pa. Commw. Page 602]

Judge noted in his Memorandum Opinion: "Which particular provision or provisions in which particular lease or leases of which particular defendant or defendants are alleged to be violative of any one or more of the paragraphs of plaintiff's complaint is unspecified."

The breadth and complexity of this case are revealed by the docket entries, which indicate that 16 of the 25 defendant landlords filed preliminary objections, five filed answers, two filed no responsive pleadings whatsoever, and two were not served. The Commonwealth, in turn, filed a Praecipe to Enter Default Judgment against only one of the unresponsive defendants. All four of the defendant form sellers filed preliminary objections. In total, 16 briefs were filed by defendants on the 20 sets of preliminary objections presently before us. We note at this time that the preliminary objections of the defendant landlords are on the same or similar grounds, and therefore, will be disposed of infra, under separate sections with appropriately entitled subheadings.

Initially, having perused the complicated pleadings in this case, one immediately queries the purpose behind the apparent random selection of the 25 defendant landlords (out of thousands in the Commonwealth) and the four defendant form sellers. That puzzle is answered in the Commonwealth's brief, wherein it is stated that:

"Plaintiff asserts a cause of action against the housing industry in the sale and use of form leases. In order to prove an adhesion contract, the court should look at industry practice. . . ." (p. 42).

". . . [T]his is a single cause of action against an industry-wide practice." (p. 43).

". . . [And plaintiff] seeks to correct abuses in the housing industry by establishing a fairness in the relationship between landlords and tenants. This action, against 25 major 'landlords' and 4 major 'form sellers,'

[ 10 Pa. Commw. Page 603]

    as representatives of that industry, seeks judicial intervention to correct the unconscionable use of contracts of adhesion, the form lease, which as used in Pennsylvania, overprotects any legitimate interests of landlords and strips tenants of common law, statutory and constitutional rights." (p. 2).

If there ever was a description of a sociologically desirable legislative program for the entire Commonwealth through the improper use of "judicial intervention," the aforesaid statement from the Commonwealth's brief sets it forth. Unless and until the General Assembly of Pennsylvania or some higher Court directs this Court, in effect, to establish social legislation (no matter how desirable it may be), this Court will condemn and refuse such "judicial intervention." Courts in this country are about the business of determining people's rights, based upon presented facts and applicable law. If the particular provisions of leases used in this Commonwealth (only generally referred to and certainly not set forth with any specificity by the Commonwealth in its complaint) are as onerous as alleged, then the proper method to test the legality of such leases is to bring a specific action, with respect to specific harm done to some specific citizen, against specific defendants on specific leases. If the Commonwealth desires a broad approach, the matter should be laid before the General Assembly. The Attorney General is clearly empowered to make such requests under the specific provisions of The Administrative Code of 1929, Act of April 9, 1929, P.L. 177, art. IX, § 905, as amended, 71 P.S. § 295, which states: "The Department of Justice shall have the power, and its duty shall be, to prepare, for submission to the General Assembly, from time to time, such revisions and codifications of the laws of this Commonwealth, or any part thereof, as may be deemed advisable."

[ 10 Pa. Commw. Page 604]

Even if the leasing of property came within the provisions of the Act involved in this case (which will be discussed infra), the approach utilized by the Attorney General is improper. In reality, the Commonwealth is requesting this Court to determine for an entire industry that provisions of agreements which are onerous to the Attorney General, but which have not yet been declared illegal or unconstitutional per se, be declared illegal, null and void. The Commonwealth's approach in this case would be analogous to the Department of Environmental Resources bringing a lawsuit against 25 owners of buildings with smokestacks and four builders of smokestacks, seeking to ...


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