Original jurisdiction in case of Delaware Valley Apartment House Owners' Association, by Paul R. Trichon, Trustee Ad Litem, and Hopkinson Associates v. Department of Revenue of the Commonwealth of Pennsylvania.
Barton A. Hertzbach, with him Frank E. Hahn, Jr., and Obermayer, Rebmann, Maxwell & Hippel, for petitioners.
R. Scott Shearer, Deputy Attorney General, for respondent.
President Judge Bowman and Judges Crumlish, Jr., Wilkinson, Jr., Mencer, Rogers, Blatt and DiSalle. Opinion by Judge Blatt. Dissenting Opinion by President Judge Bowman. Judges Rogers and DiSalle join in this dissent.
[ 36 Pa. Commw. Page 617]
This is an action within our original jurisdiction seeking a declaratory judgment on the constitutionality of Section 201(m) of the Tax Reform Code of 1971*fn1 (Tax Code), 72 P.S. § 7201(m). The petitioners are the Delaware Valley Apartment House Owners' Association (association) and Hopkinson Associates, a limited partnership which owns and operates a residential apartment house in Philadelphia. The respondent is the Pennsylvania Department of Revenue. We are here concerned with the respondent's preliminary objections which challenge the petitioners' standing to bring this action, the general appropriateness of a declaratory judgment here, and whether or not the petitioners correctly initiated this action by way of a petition for review.
The respondent first questions the standing of the association to act as a petitioner in this action, the association being a nonprofit association of owners and operators of apartment residences in the Commonwealth. The interest required of a party to bring a declaratory judgment action is defined in Section 2 of the Uniform Declaratory Judgments Act*fn2 (Declaratory Judgment Act), 12 P.S. § 832, which provides:
Any person interested under a deed, will, written contract, or other writings constituting a contract, or whose rights, status, or other legal relations are affected by a statute, municipal ordinance, contract, or franchise, may have determined any question of construction or validity arising under the instrument, statute, ordinance, contract, or franchise, and obtain a declaration of rights, status, or other legal relations thereunder.
[ 36 Pa. Commw. Page 618]
The respondent argues that because the association is not itself liable for payment of the challenged tax it cannot be considered a party whose rights are affected by a statute for purposes of bringing a declaratory judgment action. Although Section 13 of the Declaratory Judgments Act, 12 P.S. § 843, provides that the word "party" as used in the act should be construed to include an unincorporated association, the respondent's objection appears to be directed toward whether or not the status asserted by the association is sufficient under Section 2. In its petition for review, the association has not alleged any effect on its own taxpayer status, instead it has alleged only the liability of its individual members for payment of the tax. This Court has recently held in Concerned Taxpayers of Allegheny County v. Commonwealth, 33 Pa. Commonwealth Ct. 518, 525, 382 A.2d 490, 493-94 (1978), that a nonprofit corporation may gain standing to bring an action in equity challenging the constitutionality of a statute by asserting the interests of its members provided that the members' interests in themselves are sufficient to bring the action and that their interest is sufficiently pleaded. We believe that the same reasoning is applicable here. In the present case, the association has alleged that the taxpayer status of its members has been affected by the statute here challenged and we believe that this is sufficient to confer standing on the association under Section 2 of the Declaratory Judgments Act.
The respondent has also raised several challenges to the appropriateness of a declaratory judgment here. Noting that Section 6 of the Declaratory Judgments Act, 12 P.S. § 836, requires that where a statute provides a special form of remedy for a specific type of case that remedy must be pursued before a declaratory judgment action will lie, the respondent
[ 36 Pa. Commw. Page 619]
argues first that the statutory refund procedure contained in Sections 252-255 of the Tax Code, 72 P.S. §§ 7252-55, provides a statutory remedy which the petitioners must follow before a declaratory judgment should be permitted. We note, however, that the petitioners here do not seek a refund of taxes but rather a declaratory judgment that a provision of the Tax Code violates specific provisions of the United States and Pennsylvania Constitutions.*fn3 Our Supreme Court examined the sufficiency of administrative remedies as a deterrent to equitable actions attacking the constitutionality of taxing ...