Daniel Iacurci, Nancy Iacurci, Eleanor Knight, and Eugenia Knight, individually and on behalf of similarly situated homeowners in Allegheny County, Pennsylvania, Appellants
County of Allegheny, GLS Capitol, Inc., and Dynex Capitol, Inc
Argued: April 14, 2015.
Ralph N. Feldman, Pittsburgh, for appellants.
George M. Janocsko and Mandi Lea Scott, Pittsburgh, for appellees.
BEFORE: HONORABLE RENé E COHN JUBELIRER, Judge. HONORABLE MARY HANNAH LEAVITT, Judge. HONORABLE P. KEVIN BROBSON, Judge.
P. KEVIN BROBSON, Judge
Daniel Iacurci, Nancy Iacurci, Eleanor Knight and Eugenia Knight, individually and on behalf of similarly situated homeowners in Allegheny County (Appellants), appeal from an order of the Court of Common Pleas of Allegheny County (trial court) sustaining preliminary objections and dismissing their complaint. For the reasons stated below, we affirm.
Appellants filed a putative class action on behalf of owners of real property located in Allegheny County (the County) whose property has been subject to a tax lien filed by the County that the County has either retained or sold and assigned to GLS Capital, Inc. (GLS), and who have been billed by the County or GLS for attorney fees, interest calculated on a monthly basis, or prothonotary fees. Appellants' complaint challenged the constitutionality of the Act of August 14, 2003, P.L. 83 (referred to as Act 20), which amended the Municipal Claims and Tax Lien Act (MCTLA). The County and GLS filed preliminary objections. After oral argument, the trial court sustained the preliminary objections and dismissed the case.
On appeal to this Court, Appellants argue that Act 20 imposed new taxes that are unconstitutionally retroactive and impermissibly delegated taxing authority to a private entity. Alternatively, Appellants argue that if Act 20 does not impose new taxes, it violates Appellants' due process rights and is an unconstitutional taking of property under Article I, Section 10 of the Pennsylvania Constitution.
A brief history of the MCTLA and Act 20 and our courts' interpretation of the statute are instructive. Our Supreme Court in Konidaris v. Portnoff Law Associates, Ltd., 598 Pa. 55, 953 A.2d 1231 (Pa. 2008), explained:
Between 1923 and February 1996, the MCTLA allowed for the imposition of an attorney collection fee of five percent for claims resulting in a verdict or default judgment. In recognition of the relative increase in legal fees over the century, the General Assembly in 1996 amended § 3 the MCTLA to allow for the collection of " reasonable" attorney fees, rather than limiting the collectable fees to five percent. The fee provision thus burdened the delinquent taxpayer with the reasonable attorney fees expended in collecting the taxes, rather than imposing the financial burden of collection on the municipality or school district. Pursuant to the dictates of the amendment, municipalities adopted ordinances and resolutions establishing a schedule of attorney fees.
Due to an apparent drafting omission, however, the statute as amended in 1996, spoke only to the collection of reasonable attorney fees for " municipal claims" rather than " tax claims." In March 2003, this Court held in Pentlong Corp. v. GLS Capital, Inc., . . . 573 Pa. 34, 820 A.2d 1240), that § 3 of the MCTLA did not authorize taxing authorities to collect attorney fees on " tax claims" as opposed to " municipal claims" because the General Assembly failed to provide specifically for the collection of attorney fees expended in the collection of " tax claims."
In response, the General Assembly quickly amended the MCTLA to provide for the recovery from the delinquent taxpayers of reasonable attorney fees expended in the collection of " [a]ll municipal claims, municipal liens, taxes, tax claims and tax liens." 53 P.S. § 7106 (as amended by [Section 2 of Act 20]). Moreover, the General Assembly specified that the amendment " shall be retroactive to January 1, 1996." [Section 10 of Act 20.] The legislative history in both the House and the Senate indicate that the amendment was intended to address this Court's interpretation in Pentlong, and to provide statutory authorization for taxing authorities to collect ...