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Alrp Property, LLC v. Borough of Tarentum and William Rossey

October 18, 2011


The opinion of the court was delivered by: Mitchell, J.


Presently before the Court is Defendants', Borough of Tarentum's ("Tarentum" or "borough") and William Rossey's ("Rossey") motion to dismiss the amended complaint (Doc. # 11) filed by the Plaintiff, ALRP Property, LLC ("ALRP"). For the reasons that follow, the motion will be granted in part and denied in part.

II. Report

A. Factual and Procedural History

ALRP filed this 42 U.S.C. § 1983 action claiming that Tarentum and/or Rossey violated its Fourteenth Amendment equal protection and substantive and procedural due process rights when they interfered with and then destroyed its possession and use interest in a property located at 203 East Fifth Avenue in Tarentum, Pennsylvania. The subject property includes a building and a plot of land. The building was constructed in approximately 1907. Six months after it was built, the building tilted and, since that time, it has leaned to one side.

In 1993, the property was purchased by Joseph and Darlene McGough. In 1996, in response to an inquiry from Tarentum concerning the safety of the building, the McGoughs submitted a letter from David Petrak (the "Petrak report"), a structural engineer, that concluded that the building was sound. On May 15, 1996, the borough solicitor acknowledged receipt of Petrak's letter and informed the McGoughs that they had satisfied the concerns regarding the structural integrity of the building. The solicitor also advised that the Petrak report would be maintained in a file and disclaimed any responsibility of the borough for any liability arising from a structural failure of the building.

In 1999, Tarentum Laundromat Cleaners ("TLC") purchased the building. According to the amended complaint, Glen Hunkele, the president of TLC, filed a copy of the Petrak report with Tarentum which the borough acknowledged as sufficient to support the issuance of a building permit. The complaint further avers that, at this time, Tarentum declared that any subsequent purchaser of the property must be provided with a copy of the Petrak report prior to the transfer of ownership.

ALRP purchased the building in August 2008. The first floor housed a Laundromat and the second floor included two Section 8--eligible apartments, one of which was occupied. After the closing, a Tarentum building inspector informed ALRP that it must secure an engineering report concerning the soundness of the building. Based upon the building inspector's position, ALRP did not receive an occupancy permit or reopen the Laundromat. The borough representative did not inform ALRP about the existence of the Petrak report.

After its discussion with the Tarentum building inspector, ALRP became concerned that the prior owners misrepresented the trustworthiness of the building. It thus filed a complaint against the sellers in the Court of Common Pleas of Allegheny County where the matter was referred to arbitration. In the meantime, the condition of the building deteriorated.

On February 4, 2009, the Tarentum building inspector sent a notice to ALRP declaring that the building was an "Unsafe Structure" and "unfit for human occupancy" based upon the building's non-compliance with Tarentum's Ordinance "04-09, as amended." Am. Compl., Ex 4. The letter informed ALRP that recent inspections revealed a number of violations of the Code, including, the visible lean of the building, a separation in the stairs, large holes in the ceiling, and water-soaked floor joists, timbers, and beams. It was also noted that the structure showed a lack of maintenance and repair. Tarentum instructed ALRP that it had twenty days from the date of the notice to bring the building into compliance with the Code or to submit a plan detailing demolition of the structure. It further informed that failure to comply with the notice could result in legal action and the imposition of a $600 fine per day of violation and that ALRP could appeal within twenty days. According to ALRP, it did not pursue an appeal because it was still in litigation with the sellers and remained unaware of the Petrak report that supposedly attested to the structural integrity of the building.

Later in the winter of 2009, ALRP and Tarentum met to discuss ALRP's options with regard to the building. Tarentum officials recommended demolition of the building and encouraged ALRP to engage a particular company to perform the demolition. At this same meeting, ALRP inquired about the history of the building and whether the Borough possessed any paperwork referring to the structure. While Tarentum produced some documentation, it did not disclose the Petrak report or other documents related to the building.

ALRP decided to postpone making the required renovations to the building until a decision was reached in the pending arbitration between it and the sellers. As that proceeding was nearing its conclusion, Tarentum provided ALRP with the Petrak report. Shortly thereafter, the borough initiated legal proceedings with the local district magistrate due to ALRP's failure to bring the building into compliance with the local ordinance. At this point, ALRP advised the borough that it was willing to make the repairs listed in the February 4, 2009 citation, but, relying on the Petrak report's attestation to the structural soundness of the structure, asserted that it would not demolish the structure. The borough responded that it no longer accepted that premise of the Petrak report. It also informed ALRP that if it challenged Tarentum's determination that the structure was unsound, the borough would engage its own engineer to assess the integrity of the building. A hearing on the citations was postponed while the parties attempted to negotiate the future of the building, however, the borough represented that it would not agree to anything short of demolition of the building. The citation was eventually resolved by ALRP agreeing to be found guilty of one instance of failure to remove the building on the condition that Tarentum would not issue further citations.

ALRP then learned that the borough intended to develop green space near the building and believed that the borough wanted the building demolished so that the resulting vacant lot could be incorporated into the green space. At this point, ALRP offered to deed the property to Tarentum if the borough would bear the expense of the demolition or allow the borough to assert a lien against the property for the expense. The borough declined the offer, but agreed to research acquiring a grant to take down the building. Although only a government entity could apply for the grant funds, ALRP agreed to do the groundwork for the grant application.

In November and December 2009, ALRP performed all the legwork within its power to facilitate the grant process and waited for information from the borough concerning the progress of the application. In January 2010, ALRP questioned Rossey on the status of the grant application. Rossey responded that the application had been denied; in fact, though, the borough never submitted the application. Rossey also warned ALRP that it would face daily citations until the building was demolished. Rossey then informed the press that the reason the grant money was not secured was because there was no grant money available.

A few days after the conversation between ALRP and Rossey, ALRP was contacted by a relative of Rossey's, Jeffrey Steihler, the owner of a neighboring property. Steihler expressed interest in acquiring the subject property from ALRP for no consideration in exchange for his assumption of responsibility for the building. The offer was contingent on Steihler's being allowed to enter the building with a contractor or engineer to assess the potential costs of rectifying the problems with the building. According to the complaint, Steihler intimated that he could influence the borough to overturn its condemnation decision.

The dialogue between ALRP and Steihler continued through April 2010 while the building continued to deteriorate. Tarentum issued several new citations for failure to rectify an unsafe structure. Following a hearing on the charges, ALRP was found guilty and a fine was imposed.

On February 2, 2011, ALRP filed a 42 U.S.C. $1983 action, alleging violations of its Fourteenth Amendment equal protection and due process rights. After the defendants filed a motion to dismiss, ALRP was granted leave of court to file an amended complaint. In count one of its amended pleading, ALRP claims that Tarentum and Rossey intentionally treated it differently from both the prior owners of the subject property and from similarly situated owners of other properties without reason. Because of ...

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