Sue Davis-Haas, Richard H. Haas, Ida C. Smith, Zildia Perez, Leon Perez, Donna Galczynski, Kevin Galczynski, Alan Ganas, Renee Froelich, Scott Matthews, Patricia J. Miravich, John J. Miravich and William Ryan, Appellants
Exeter Township Zoning Hearing Board and MetroDev V, LP and Exeter Township
Argued: June 5, 2017
BEFORE: HONORABLE ROBERT SIMPSON, Judge HONORABLE ANNE E.
COVEY, Judge (P.) HONORABLE BONNIE BRIGANCE LEADBETTER,
this, the most recent of several related appeals in this land
use case, Objectors ask whether the Court of Common Pleas of
Berks County (trial court) erred in affirming a
decision of the Exeter Township Zoning Hearing Board (ZHB)
that sustained MetroDev V, LP's (Landowner) procedural
validity challenge. Objectors argue the trial court erred in
failing to: (1) enforce a settlement agreement reached by the
parties; (2) find that Landowner's 2005 procedural
challenge to and the process Landowner followed was defective
and Objectors' rights were violated; and (3) determine
Landowner lacked standing to prosecute its procedural
validity challenge. Upon review, we affirm.
case has an extensive procedural history, most of which was
set forth in this Court's decision in Metro Dev V, LP
v. Exeter Township Zoning Hearing Board (Pa. Cmwlth.,
No. 1367 C.D. 2013, filed July 24, 2014), 2014 WL 3697529
(unreported). There, we explained that Objectors own
properties adjacent to Landowner's proposed residential
development. Landowner's property (subject property)
consists of approximately 46.36 acres in an area where the
boundary lines of the Township of Exeter (Township), and two
surrounding municipalities, Lower Alsace Township and Alsace
to July 25, 2005, the Township's Zoning Ordinance No. 500
(old ordinance) was in effect. Under the old ordinance, the
subject property was zoned low density residential. On July
25, 2005, the Township enacted Zoning
No. 596 (new ordinance), which changed the zoning
classification of the property from low density residential
to suburban residential. The changed classification had the
practical effect of reducing the number of residential lots
permitted on the subject property from 30 to 7.
August 2005, Landowner filed a challenge to the validity of
the new ordinance with the ZHB pursuant to former Section
10909.1(a)(2) of the Pennsylvania Municipalities Planning
Code (MPC) alleging procedural irregularities in its
September 2005, a preliminary subdivision plan was submitted
for a residential development on the subject property called
"Windy Willows, " comprising 34 residential lots,
26 of which were located within the Township. The plan was
based on a sketch plan that was previously submitted while
the old ordinance was still in effect. Waivers were sought
from the Township's Subdivision and Land Development
September 26, 2005, the Township and Landowner entered into a
settlement agreement in which Landowner agreed to withdraw
its procedural validity challenge to the new ordinance in
exchange for the Township's agreement to review and
potentially approve the plan under the terms of the old
ordinance. Shortly thereafter, Landowner withdrew its
2008, the Township approved Landowner's plan, subject to
certain conditions. The Township also granted waivers from
certain SALDO sections but it reserved its determination of
other waiver requests until the final plan approval stage.
Pursuant to the terms of the settlement agreement, the
Township reviewed the plan under the old ordinance.
subsequently filed a land use appeal with the trial court.
Landowner intervened. The Township filed a motion to dismiss
the appeal, arguing Objectors lacked standing to appeal
because they did not appear in the proceedings below. The
trial court granted the Township's motion and dismissed
Objectors' appeal. On appeal, this Court held Objectors,
as adjacent landowners, had substantive standing to object to
subdivision plans both before the Township and in land use
appeals, even though they did not appear before the Township
or its Planning Commission. Miravich v. Twp. of
Exeter 6 A.3d 1076 (Pa. Cmwlth. 2010) (Miravich
I). We reversed and remanded.
remand, the trial court denied Objectors' land use
appeal. The trial court determined the Township did not err
by reviewing the plan under the old ordinance based on the
terms of the settlement agreement because municipalities are
legally authorized to settle challenges to zoning ordinances.
The trial court also upheld the Township's grant of
waivers to Landowner, and it held Landowner had standing to
submit the plan.
filed another appeal to this Court, asserting: (1) the proper
procedure to challenge the new ordinance was to have a
hearing before the ZHB; (2) the settlement agreement was an
invalid exercise of the Township's authority to settle
the challenge to the new ordinance; (3) the Township erred by
applying the old ordinance instead of the new ordinance to
the plan; (4) the Township's approval of the plan was
defective; and, (5) Landowner lacked standing to seek
preliminary plan approval. Miravich v. Twp. of
Exeter 54 A.3d 106 (Pa. Cmwlth. 2012) (Miravich
this Court held the Township lacked authority to determine
which zoning ordinance would be applied to the plan for three
reasons. First, Landowner's procedural challenge fell
within the exclusive jurisdiction of the ZHB, not the
Township. Additionally, Landowner filed its challenge with
the ZHB and did not bring the matter before the Township as a
substantive validity challenge. Finally, even if Landowner
filed its challenge with the Township, the Township was
required to hold a hearing within 60 days of the request and
provide notice of the hearing, events which did not occur.
This Court concluded that, by entering into the settlement
agreement with Landowner and agreeing the old ordinance would
apply to the plan, the Township usurped the ZHB's role
and violated the MPC's notice and hearing provisions.
Citing the trial court's opinion, this Court also noted
that the parties did not dispute that the enactment process
for the new ordinance was procedurally defective.
Court also held that the settlement agreement was an invalid
exercise of the Township's authority to settle the
procedural validity challenge to the new ordinance. We
determined the settlement agreement was akin to contract
zoning, which the Pennsylvania Supreme Court expressly
disapproved in Carlino v. Whitpain Investors, 453
A.2d 1385 (Pa. 1982).
this Court held the Township erred when it considered the
plan under the old ordinance rather than the new ordinance.
We concluded Landowner submitted its plan after passage of
the new ordinance; therefore, under Section 508(4)(i) of the
MPC, 53 P.S. §10508(4)(i), which provides that an
application for subdivision approval is governed by the
ordinance in effect at the time the application is filed, the
new ordinance applied. Additionally, as to Objectors'
arguments that the Township's approval of the plan was
defective, this Court rejected some arguments and accepted
both parties filed petitions for allowance of appeal to the
Supreme Court, which were ultimately denied. The plan
approval appeal proceeded on remand. Meanwhile, however,
while the petitions for allowance of appeal were pending,
Landowner sent a letter to the ZHB requesting that it conduct
a hearing on the procedural validity challenge Landowner
filed in 2005 and subsequently withdrew pursuant to the
held a hearing on the validity challenge at which it heard
testimony and received exhibits regarding the legal status of
the 2005 challenge and the relevancy of this Court's
decision in Miravich II declaring the settlement
agreement invalid. The ZHB concluded there was nothing before
it to consider because Landowner unconditionally withdrew its
challenge in October 2005. The ZHB also held it could not
exercise equity powers to conclude Landowner's withdrawal
of the challenge was nullified by this Court's
determination that the settlement agreement was invalid
because zoning boards lack equity powers.
appealed to the trial court, challenging both the ZHB's
denial based on jurisdictional grounds and the validity of
the new ordinance. The trial court determined Landowner
properly filed an appeal within 30 days after the adoption of
the new ordinance, which was only withdrawn after the parties
reached a settlement agreement. Thus, the trial court
remanded to the ZHB for a determination on the merits. The
trial court explained the settlement agreement was a contract
between Landowner and the Township, and when this Court held
it was invalid in Miravich II, Landowner did not
receive the benefit of its contractual bargain. As such, the
trial court determined Landowner should be placed back to its
original position, and the ZHB had jurisdiction to hear the
2005 procedural validity challenge. The trial court also
determined that in Miravich II this Court intended
the matter to be remanded to the ZHB because only the ZHB had
jurisdiction over a procedural validity challenge filed in
further appeal by Objectors, this Court affirmed, holding,
"[b]ecause the settlement agreement has been
invalidated, unmaking the contract between [Landowner] and
the Township by judicial order, equity requires that
[Landowner] must be returned to its position prior to
execution of the settlement agreement. Therefore, the ZHB is
required to decide the merits of the procedural validity
challenge under the statutory procedure in effect in
2005." Metro Dev V, Slip Op. at 11, 2014 WL
3697529 at *5.
the ZHB held hearings on Landowner's procedural validity
challenge to the new ordinance. Ultimately, the ZHB sustained
Landowner's procedural validity challenge, and it
declared the new ordinance void ab initio. In so
doing, the ZHB made the following relevant determinations.
2005, the Township undertook a project to amend its zoning
ordinance. After various meetings, the Township decided to
advertise for public hearing and enact a proposed ordinance
to amend and restate the Township zoning ordinance and the
zoning map in their entirety (collectively, the draft
Township advertised a notice in the Reading Eagle, a
newspaper of general circulation in the area, on June 29 and
July 6, 2005, which stated:
The Exeter Township Board of Supervisors [(Supervisors)] will
hold a public hearing at 7:00 P.M. on July 18, 2005 to hear
[p]ublic [c]omment on the [draft ordinance]. The
[Supervisors] will consider adoption of the [draft ordinance]
at their July 25, 2005 meeting. Full text of the [draft
ordinance] is available for public inspection at the Township
Office, 4974 DeMoss Road, Reading, PA 19606. If you require
special accommodations in order to attend Township meetings,
please call the Township office at 610-779-5660. The Township
will make every reasonable attempt to accommodate you.
Troy S. Bingaman, Manager/Secretary.
ZHB Op., 9/24/15, Finding of Fact (F.F.) No. 28 (Reading
Reading Eagle Notice did not provide "the time and
place" of the meeting on July 25, 2005 in which the
Supervisors would consider enactment of the draft ordinance.
F.F. No. 29. Also, the Reading Eagle Notice did not provide
either "the full text" of the draft ordinance or
"a brief summary which lists provisions [of the draft
ordinance] in reasonable detail[.]" F.F. No. 30.
Although the Reading Eagle Notice did indicate that copies of
the Draft Ordinance could be obtained at the Township
Building, the Notice did not state "copies of the
proposed ordinance or amendment may be examined without
charge or obtained for a charge not greater than the cost
hereof." F.F. No. 31. Further, the Reading Eagle Notice
was prepared by the Township Manager, not the Township
Solicitor. The draft ordinance provided for changes to the
zoning map that did not constitute comprehensive rezoning as
only a few areas of the Township were rezoned.
further determined a notice of the public hearing on July 18,
2005 and proposed enactment at the July 25, 2005 meeting were
not conspicuously posted along tracts of land that were the
subject of zoning map changes under the draft ordinance.
Also, a notice of the public hearing on July 18, 2005 and
proposed enactment at the July 25, 2005 meeting was not
mailed to the owners of the tracts of land within the
Township that were the subject of zoning map changes under
the draft ordinance. An attested copy of the draft ordinance
or any revised version was not filed in the County Law
Library at any time prior to July 25, 2005. Additionally, a
copy of the full text of the draft ordinance or any revised
version was not filed with the Reading Eagle at any time
prior to July 25, 2005.
18, 2005, the Supervisors held a public hearing at which time
the draft ordinance was reviewed. At the hearing, the
Supervisors made several substantial changes to the draft
ordinance including changes to uses within zoning districts,
changes to definitions and changes to objective criteria for
uses. The Township Planning Commission reviewed the draft
ordinance with the changes recommended at the July 18 hearing
at a workshop meeting on July 20, 2005. At that time the
Township Planning Commission recommended additional changes
to Sections 400 and 500 of the draft ordinance.
25, 2005, the Supervisors held a public meeting at which time
the draft ordinance (with the changes recommended at the July
18 hearing and the July 20 Planning Commission workshop
meeting) was considered for adoption. As a result of public
comment at the July 25 Supervisors' meeting, the draft
ordinance was revised again. F.F. No. 42.
25, 2005, the Supervisors adopted the new ordinance, which
was in the form and content of the draft ordinance with the
changes recommended at the July 18 public hearing, the July
20 Planning Commission workshop meeting, as well as the July
25 Supervisors' meeting, and served to amend and restate
the zoning ordinance in its entirety.
July 18 and prior to the adoption of the new ordinance on
July 25, neither any of the revised versions of the draft
ordinance nor the final version of the new ordinance were:
(a) submitted to the County Planning Commission for review;
(b) submitted to the Township Planning Commission for review
of the changes made at the July 25 meeting; (c) submitted to
the County Law Library to be available for public inspection;
(d) submitted to the Reading Eagle to be available for public
inspection; (e) re-advertised in the Reading Eagle for a
public hearing or enactment at a public meeting; (f) posted
conspicuously along tracts in the Township that were the
subject of zoning map changes; or, (g) mailed to the owners
of the tracts of land within the Township that were the
subject of zoning map changes. F.F. No. 44.
ordinance became effective on August 5, 2005, 10 days after
its passage by the Supervisors. On August 24, 2005, Landowner
filed its procedural validity challenge with the Township,
which was within 30 days of the new ordinance's effective
explained that a procedural challenge must be brought within
30 days of an ordinance's effective date. 42 Pa. C.S.
§5571(c)(5). Where a challenge is filed within 30 days
of the ordinance's effective date, the party alleging a
defect must prove there was a failure to strictly comply with
statutory procedure. However, where a challenge is filed
outside the 30-day period, a party must prove its right to an
exemption from the deadline. This is accomplished by evidence
showing the municipality's "failure to substantially
comply" with applicable procedures prevented the public
from commenting on the ordinance. Hawk v. Eldred Twp. Bd.
of Supervisors, 983 A.2d 216 (Pa. Cmwlth. 2009). If the
challenging party meets its burden of proof, the challenged
ordinance is void ab initio. Id.
609 of the MPC, 53 P.S. §10609, establishes the
procedures to be followed in the enactment process of zoning
ordinance amendments. Additionally, Section 610 of the MPC,
53 P.S. §10610, establishes the requirements for
publication, advertisement and availability of proposed
the ZHB found Landowner submitted credible evidence to meet
its burden of establishing that its application was filed
within 30 days of the effective date of the new ordinance,
and that the Township did not strictly comply with the
required statutory procedure. Specifically, the ZHB
determined the Township did not strictly comply with the
required statutory procedure in the enactment process of the
new ordinance based on 11 defects, detailed more fully below.
In light of these determinations, the ZHB sustained
Landowner's procedural validity challenge, and it
declared the new ordinance void ab initio. Objectors
appealed to the trial court raising numerous issues.
the trial court, the parties engaged in settlement
discussions and reached a tentative agreement; however, a
final settlement agreement was not reached.
without taking additional evidence on Objectors' land use
appeal, the trial court affirmed. Additionally, the trial
court denied Objectors' motion to enforce the purported
settlement agreement reached before the trial court. This
appeal,  Objectors assert the trial court erred in
failing to: (1) enforce a settlement agreement reached by the
parties after the trial court determined Landowner was unable
to comply with one of the terms of the agreement; and, (2)
find Landowner's 2005 procedural challenge to the new
ordinance and the process Landowner followed was defective
and Objectors' rights were violated where (a) substantial
and actual notice of the new ordinance was provided to all
Township residents; (b) substantial reliance was shown by
Objectors that the new ordinance was properly enacted; and,
(c) the defective process undertaken by Landowner denied
Objectors due process. Objectors also argue the trial court
erred in failing to conclude Landowner lacked standing to
prosecute its 2005 procedural validity challenge where it
sold the subject property.
Purported 2016 Settlement Agreement
first argue the trial court erred or abused its discretion
when it failed to enforce a 2016 settlement agreement reached
by the parties following Objectors' appeal of the
ZHB's 2015 decision declaring the new ordinance
procedurally invalid. Objectors assert Pennsylvania has a
strong judicial policy in favor of voluntarily settling
lawsuits. Mastroni-Mucker v. Allstate Ins. Co., 976
A.2d 510 (Pa. Super. 2009). Objectors contend settlement
agreements are enforced according to principles of contract
law. McDonald v. Ford Motor Co., 643 A.2d 1102 (Pa.
Super. 1994). Under Pennsylvania law, a contract exists when
parties exhibit mutual assent to the terms of an agreement.
Shovel Transfer & Storage, Inc. v. Pa. Liquor Control
Bd., 739 A.2d 133 (Pa. 1999).
settlement contains all of the requisites for a valid
contract, a court must enforce the terms of the agreement,
even if the terms are not yet formalized in writing.
Mastroni-Mucker. The intent of the parties to a
written contract is contained in the writing itself. Mace
v. Atl. Refining & Mktg. Corp., 785 A.2d 491 (Pa.
2001). Moreover, after the parties reach a meeting of the
minds as to the essential terms of their agreement, the
existence of gaps in the contract will not vitiate it.
See Commerce Bank/Pa. v. First Union Nat'l Bank,
911 A.2d 133 (Pa. Super. 2006). Thus, "[t]he law in this
Commonwealth makes clear that … [i]f parties agree
upon essential terms and intend them to be binding, a
contract is formed even though they intend to adopt a formal
document with additional terms at a later date."
Shovel Transfer & Storage, 739 A.2d at 136
(internal quotations omitted); see also Commerce
Objectors maintain, the parties agreed to the essential terms
of a settlement. The parties did not contemplate any
additional terms that needed to be agreed on as a condition
precedent to enforceability. Objectors argue that before the
trial court, the parties made no effort to clarify or object
to any of the terms of the proposal upon accepting it.
contend that, as admitted by Landowner, the parties entered
into a settlement agreement. Reproduced Record (R.R.) at
25a-33a, 1123a-24a. The terms of that agreement were simple:
(1) an entrance road would be moved; (2) Landowner would
receive certifications from the three township engineers that
the township boundary lines depicted on the plan were
accurate; (3) Landowner would pay the immediately adjacent
neighbors $60, 000; and, (4) the parties would release each
other, thus requiring Objectors not to further challenge
Landowner's development. R.R. at 70a-77a. Objectors
maintain Landowner itself sought enforcement of the
settlement agreement, and it admitted in its motion that
there was a "meeting of the minds." R.R. at 32a.
Therefore, no basis exists to not enforce the essential terms
of the settlement agreement.
contend Pennsylvania courts frequently enforce agreements
that contemplate the execution of a formal contract with
additional terms in the future. See, e.g.,
Shovel Transfer & Storage. Indeed, Objectors
argue, when compared to other settlement agreements enforced
under Pennsylvania law, the agreement here is much more
definitive and clearly enforceable. See e.g.,
Hatalowich v. Redev. Auth. of Monessen, 312 A.2d 22,
24-25 (Pa. 1973) (acceptance of proposal created a contract
despite the fact that parties intended to later execute
formal document); Compu Forms Control, Inc. v. Altus
Grp., 574 A.2d 618 (Pa. Super. 1990) (oral settlement
agreement was enforceable even though the parties were unable
to agree on, and execute, formal agreement). Here, Objectors
argue there can be no dispute that the parties entered into
an agreement that was simply not yet reduced to a writing
signed by the parties, but the parties agreed on all
essential terms. See Commerce Bank, 911 A.2d at 147
(enforcing terms of draft settlement agreement where parties
reached "meeting of the minds" regarding essential
terms of the agreement).
further contend the term of the agreement relating to
certification of municipal boundary lines was important to
Objectors because they believed Landowner intentionally
misrepresented the boundaries between the municipalities to
allow more development in the Township given that it allows
for smaller lots. Although this was not a specific legal
issue before the trial court, Objectors maintain, the trial
court agreed this term would be included so Objectors would
provide Landowner a general release not to challenge
Landowner's development again. Objectors argue
Landowner's failure to comply with this term constituted
a breach of the agreement; therefore, this case should be
remanded to enforce the settlement agreement.
Landowner responds that the trial
court correctly held that a settlement agreement that cannot
be performed is not enforceable as a matter of law. As
detailed by the trial court, Landowner and the Township could
not perform a material term of the proposed settlement
agreement; as such, the contract could not be enforced.
Landowner contends the trial court laid out the term that
Landowner and the Township could not perform and the reasons
the parties rejected the settlement proposal. As such, no
meeting of the minds ever occurred; thus, nothing suggests
the ability to enforce a settlement proposal.
argues it is critical to note that the settlement agreement
Landowner sought to enforce through its motion was
substantially different than the purported agreement
Objectors now seek to enforce. In fact, Objectors never
responded to the settlement's writing and the parties
relied on a spoken agreement. Despite this discussion,
Landowner asserts, throughout the entire summer of 2016-again
to the delay of Landowner's development-the terms of the
agreement continually changed. From the loss of lots in
April, to the payment of funds in May, to boundary
certifications in June and then to loss of lots again in
July, Objectors repeatedly changed the terms of any
Landowner maintains, as the draft agreements indicate, the
Township always proposed a full release. R.R. at 72a-77a.
However, at no time from April through June did Objectors
respond to that requirement, until the motion to enforce
settlement was filed. Essentially, Landowner argues Objectors
want it both ways. They refused to settle in the midst of
litigation, R.R. at 2a, and then they demanded enforcement of
a purported settlement agreement after losing before the
noted by the trial court, Landowner contends, the final
version of the settlement agreement could not be satisfied by
Landowner and the Township. As such, the agreement failed as
a matter of law. See, e.g., West v.
Peoples First Nat'l Bank & Trust Co., 106 A.2d
427 (Pa. 1954). Importantly, Landowner argues, the cases
Objectors cite in support of their position include scenarios
involving a clear meeting of the minds where the only
outstanding issue was a finalized writing. No meeting of the
minds occurred here.
maintains that, as to the purported agreement, the trial
court specifically referenced the boundary issue and made a
finding that the parties could not survey the boundary in the
manner demanded by Objectors. Thus, not all terms were
satisfied. Landowner asserts our Supreme Court holds:
"As with any contract, it is essential to the
enforceability of a settlement agreement that 'the minds
of the parties should meet upon all the terms, as well as the
subject-matter, of the [agreement].'" Mazzella
v. Koken, 739 A.2d 531, 536 (Pa. 1999) (citing Onyx
Oils & Resins, Inc. v. Moss, 80 A.2d 815, 817 (Pa.
1951)). Moreover, Landowner argues, the boundary issue was
only one of several items upon which the parties could not
agree, thus showing the settlement agreement was not
enforceable as a matter of law.
part, the ZHB notes, although present and a party to the
matter, it was not directly involved in negotiations and
attempts to resolve the matter through the proposed
settlement agreement before the trial court. Nevertheless,
the ZHB opposes Objectors' argument that the trial court
should have enforced the proposed settlement agreement. The
ZHB joins Landowner's argument on this issue in support
of the trial court's finding that the proposed settlement
agreement was not enforceable based on the impossibility of
performance of a material term.
resolving this issue, the trial court here explained (with
[Objectors] requested that this court enforce a settlement
agreement reached amongst the parties in court in April,
2016, and reduced to writing, but never finalized. The
agreement discussed in court contained financial terms and
several other provisions, but it was never finalized, and
no party performed any of the obligations contained in the
agreement. A material term of that agreement
required [Landowner] and [the Township] to obtain
certification from the engineers of the three municipalities
of each of the municipal boundaries as depicted on
[Landowner's] preliminarily approved land development
plans. [The Township] and [Landowner] were unable to obtain
the certifications, but proposed in the alternative, in
accordance with the recommendations of their relative
engineers, that determination of the municipalities'
boundaries be obtained in accordance with the procedures [set
forth in] [S]ection 302 of the [Second Class Township
Code. This proposal was rejected by
[Objectors] who insisted that they would not entertain any
agreement absent certification from the engineers.
[The] Township and [Landowner] could not perform a
material term of the settlement agreement. 'If
performance on one side or another of a contract becomes
excusably impossible while the transaction is wholly
executory on both sides, not only is the contract discharged,
but neither party is subject to obligation of any kind.'
[West, 106 A.2d at 433] citing Williston on
Contracts, vol. 6 (Rev. Ed.). See also, Ellwood City
Forge Corp. v. Fort Worth Heat Treating Co., Inc., [636
A.2d 219 (Pa. Super. 1994)]. Accordingly, impossibility
of performance of the material term rendered the agreement,
if indeed any was reached, terminated.
Tr. Ct., Slip Op., 9/15/16, at 9.
Objectors' claims that the parties reached a settlement
agreement after Objectors' appeal of the ZHB's
decision invalidating the new ordinance, Objectors point to
no record evidence to support their claim that an enforceable
agreement actually existed. Objectors note that, in June
2016, Landowner filed a motion to enforce the purported
settlement agreement between the parties in which Landowner
indicated there was a "meeting of the minds."
See R.R. at 32a. Shortly ...