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HomeMy WebLinkAbout97-1970 MLD / 02-5930 CivilMONROE TOWNSHIP MUNICIPAL AUTHORITY, CLAIMANT RICHARD L. SWOPE AND JOYCE L. SWOPE, HUSBAND AND WIFE, OWNERS IN THE COURT OF COMMON PLEAS OF CUMBERLAND COUNTY, PENNSYLVANIA 97-1970 MLD TERM 02-5930 CIVIL TERM IN RE: PETITION TO REDUCE A MUNICIPAL LIEN TO JUDGMENT BEFORE BAYLEY, J. OPINION AND ORDER OF COURT Bayley, J., February 25, 2003:-- On April 16, 1997, Monroe Township, a second class township in Cumberland County, filed a municipal lien against Richard L. Swope and Joyce L. Swope, husband and wife, as the owners of 675 Valley View Drive, Monroe Township (Boiling Springs), Cumberland County. The lien sets forth, inter alia: Monroe Township hereby files this Municipal Claim for services and sewer rates levied and assessed from October 1, 1977 through and including March 31, 1997 (fourth calendar quarter 1977 through and including first calendar quarter 1997). Said Township services and sewer rates were levied and assessed pursuant to Township Ordinance No. 3 of 1978, same being known and cited as the "Monroe Township Sewer Rental and Charge Ordinance", [sic] as amended... which services total in the amount of $7,079.31, which sum was duly assessed against Richard L. Swope and Joyce L. Swope, husband and wife, and the real property described herein from the date of said billing statements as attached hereto, and for which sum, with interest in the amount of ten (10%) percent, along with penalties and all costs, and including attorneys' fees, a municipal lien is claimed against the above- described real property and premises in accordance with the Act of 97-1970 MLD TERM 02-5930 CIVIL TERM May 16, 1923, P.L. 207, § 7, as amended, 53 P.S. § 7101, et seq., as amended. (Municipal Claims and Tax Liens). (Emphasis added.) On December 10, 2002, a voluntary substitution of claimant, Monroe Township Municipal Authority, the successor in interest of Monroe Township, was entered. On December 13, 2002, the Monroe Township Municipal Authority, seeking to enforce payment of its claim out of the real estate upon which the lien is attached, filed a praecipe for the issuance of a writ of scire facias sur municipal claim.1 The writ was issued by the Prothonotary that date. The owners filed an affidavit of defense on January 6, 2003, in which they aver that the lien is unenforceable and should be stricken. 2 On January 22, 2003, the Authority filed a response to the affidavit and a petition to reduce its lien to judgment. The Authority seeks judgment in the amount of the lien plus accumulated interest totaling $10,154.85, and an award of attorney fees of $4,339.36. A hearing was conducted on February 5, 2003. White Rock Sewage Corporation was a utility licensed before the Pennsylvania Public Utility Commission. Richard L. Swope was a stockholder and officer of the corporation. He and his wife, Joyce L. Swope, own 675 Valley View Drive which is located in White Rock Acres development that was served for sewage collection by the See Fox Chapel Sanitary Authority v. Abbott, 34 Commw. Ct. 637 (1978). 2 An affidavit of defense allows the owners to raise all defenses they have to the municipal lien. Shapiro v. Center Township, Butler County, 159 Pa. Commw. 82 (1993). There was no requirement for the owners to appeal within a specified period from the initial filing of the lien. Id. -2- 97-1970 MLD TERM 02-5930 CIVIL TERM White Rock Sewage Corporation. On April 8, 1974, the corporation passed a resolution to allow Richard Swope "to take sewage service in lieu of additional renumeration [sic]" as reimbursement for his "additional workload due to sewage system." The White Rock Sewage Corporation filed a petition for bankruptcy on October 3, 1994. In September, 1995, in conjunction with the bankruptcy, the White Rock Sewage Corporation and Monroe Township entered into an agreement in which the corporation transferred ownership of its sewer system and other assets to the Township. The Agreement provided: [t]he parties reserve in the Township the right and ability to collect any amounts due and owing from ratepayers who have not paid under legal obligation to do so .... (Emphasis added.) Thereafter, Monroe Township, and now the Monroe Township Municipal Authority, in accordance with the provisions of Township Ordinance No. 3 of 1978, has provided sewage collection service to the properties that had been served by the White Rock Sewage Corporation.3 Despite a representation to the contrary in the lien, the evidence shows that the Swopes have paid for all sewage collection services provided by the Township and the Municipal Authority to their property under Township Ordinance No. 3 of 1978 since the Township took over the collection of sewage. The 3 Monroe Township provided sewage treatment service to the White Rock Sewage Corporation even before it took over the collection service. The Township, and now the Authority, collects sewage for properties throughout the Township, and provides sewage treatment. -3- 97-1970 MLD TERM 02-5930 CIVIL TERM subject lien in the amount sought to be reduced to judgment covers only the amounts the Township believes should have been paid for sewage collection at 675 Valley View Drive, but was not paid by Richard Swope pursuant to the resolution of the White Rock Sewage Corporation on April 8, 1974. The Township filed the lien based on its legal conclusion that the White Rock Sewage Corporation was not permitted to "exonerate" the owners of 675 Valley View Drive for payment of collection services. It relies on Sections 1303 and 1304 of the Public Utility Code, 66 Pa.C.S. Section 101 et seq. Section 1303 provides: Adherence to tariffs No public utility shall, directly or indirectly, by any device whatsoever, or in anywise, demand or receive from any person, corporation, or municipal corporation a greater or less rate for any service rendered or to be rendered by such public utility than that specified in the tariffs of such public utility applicable thereto. The rates specified in such tariffs shall be the lawful rates of such public utility until changed, as provided in this part .... (Emphasis added.) Section 1304 provides: No public utility shall, as to rates, make or grant any unreasonable preference or advantage to any person, corporation, or municipal corporation, or subject any person, corporation, or municipal corporation to any unreasonable prejudice or disadvantage. (Emphasis added.) The owners maintain that Richard Swope was not granted a preferential rate for sewage collection services provided by White Rock Sewage Corporation, nor was he granted an exoneration. Rather, he traded his services provided to the corporation in exchange for the cost of sewage collection based on the established rate for 675 Valley -4- 97-1970 MLD TERM 02-5930 CIVIL TERM View Drive. Whether such a legal conclusion is warranted under Sections 1303 and 1304 of the Public Utility Code, thus negating liability for what is in effect on account receivable owed to the Township based on an unpaid legal obligation for collection services, is not an issue we need address. Under the General Municipal Law at 53 P.S. Section 2231, municipalities: may provide by ordinance or resolution, enacted either before or after the acquisition or construction thereof [of a sewer system], or the entry into such contract, for the imposition and collection of an annual rental, rate or charge for the use of Iai sewer, sewer system .... The annual rental, rate or charge so imposed shall be a lien on the properties serviced, and such liens may be filed in the office of the prothonotary and collected in the manner provided by law for the filing and collection of municipal claims. (Emphasis added.) The definitions section in the General Municipal Law at 53 P.S. Section 7101 provides: The words "municipal claim," as used in this act unless specifically indicated otherwise, mean and include... (2) the claim filed to recover for.., sewer rates... The word "municipality," as used in this act means any... township.., and a body politic and corporate created as a Municipal Authority pursuant to law. Section 7107 of the Act provides: The lien for.., sewer rates, or rates for any other service furnished by a municipality, -- shall exist in favor of, and the claim therefore may be filed against the property thereby benefited by, the municipality extending the benefit .... (Emphasis added.) -5- 97-1970 MLD TERM 02-5930 CIVIL TERM Monroe Township never provided any sewer collection services to the property of the Swopes until after the Agreement in September, 1995, transferring ownership of White Rock's sewage system to Monroe Township. Under Section 7107 of the General Municipal Law, a lien may be filed only for services "furnished by a municipality." While the Agreement of September, 1995, reserved to the Township "the right and ability to collect any amounts due and owing from ratepayers who have not paid under legal obligation to do so," authorization to file a lien is a statutory remedy, and is limited in the General Municipal Law to services "furnished by a municipality." Thus, the subject lien which states "Said Township services and sewer rates were levied and assessed pursuant Township Ordinance No. 3 of 1978," is incorrect. While Monroe Township obtained a right under its September, 1995, Agreement with White Rock Sewage Corporation to collect any amounts due and owing from ratepayers of the corporation who had not paid it under legal obligation to do so, it had no statutory authority to file a municipal lien for sewage collection services that were not levied under an ordinance of the Township. Accordingly, the petition to enter judgment on the lien filed on April 16, 1997, with accumulated interest and attorney fees must be dismissed, and the lien ORDER OF COURT AND NOW, this day of February, 2003, IT IS ORDERED that: (1) The petition of claimant to reduce a municipal lien to judgment, IS stricken. -6- 97-1970 MLD TERM 02-5930 CIVIL TERM DISMISSED. (2) The municipal lien filed on April 16, 1997, IS STRICKEN By the Court, Edgar B. Bayley, J. James D. Bogar, Esquire Jennifer B. Hipp, Esquire For Claimant William H. Andring, Esquire For Richard L. Swope and Joyce L. Swope :sal -7-