Guido v. Township of Sandy

880 A.2d 1220, 584 Pa. 93, 2005 Pa. LEXIS 1798
CourtSupreme Court of Pennsylvania
DecidedAugust 23, 2005
Docket36 WAP 2003
StatusPublished
Cited by16 cases

This text of 880 A.2d 1220 (Guido v. Township of Sandy) is published on Counsel Stack Legal Research, covering Supreme Court of Pennsylvania primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Guido v. Township of Sandy, 880 A.2d 1220, 584 Pa. 93, 2005 Pa. LEXIS 1798 (Pa. 2005).

Opinions

OPINION

Justice BAER.

In this dispute concerning real property, we granted allocatur limited to determining whether a leasehold interest in a parcel of land coupled with an option to purchase such land creates a property interest in the lessee-optionee sufficient to support a legally recognized subdivision of the property either at the time the lease and option were simultaneously executed or when the purchase option was exercised. The Commonwealth Court held that governmental recognition of a subdivision was not proper at either time because the petitioning party failed to satisfy the requirements of the municipality’s relevant ordinances. We affirm.

BACKGROUND

Appellee John Guido (Guido) purchased the Property at issue situate in Sandy Township, Pennsylvania, in 1986. At purchase, the 3.379-acre lot was informally separated into two parcels by virtue of a 1982 lease (hereinafter, 1982 Lease) between Guido’s predecessor in title and Appellant Dubois Dutch, LLC’s predecessor lessee.1 Dubois Dutch owns and operates a Dutch Pantry Restaurant on a 2.605-acre area of the lot; Guido retains occupancy of the smaller portion of the parcel, approximately 0.772 acres in area, on which he built and maintains a convenience store and gas station.2

[96]*96The present conflict arose because the 1982 Lease between Dubois Dutch and Guido contained an option granting Dubois Dutch the opportunity to purchase the Restaurant Parcel before the expiration of the 1982 Lease on February 29, 1999 (hereinafter, the Option). On June 19, 1996, however, before Dubois Dutch had exercised the Option and prior to the 1982 Lease’s expiration, Sandy Township repealed its 1964 Zoning Ordinance (hereinafter, 1964 Zoning Ordinance), which applied when the 1982 Lease and Option were executed, and adopted a new Zoning Ordinance (hereinafter, 1996 Zoning Ordinance), which required minimum lot sizes of 45,000 square feet in the area where the Property is located.

In November 1998, Dubois Dutch attempted to exercise the Option. Exercise of the Option would have left Guido with a lot 33,259 square feet in area, 11,741 square feet fewer than the required minimum lot size set forth in the 1996 Zoning Ordinance.3 Guido refused to convey the Restaurant Parcel to Dubois Dutch, due to his concern that his residue lot, the Gas Station Parcel, would be non-conforming pursuant to the 1996 Zoning Ordinance and thus rendered commercially useless. On November 28, 1998, Dubois Dutch sought formal subdivision approval from the Sandy Township Planning Commission (hereinafter, Planning Commission).4 Guido objected and the [97]*97Planning Commission rejected the subdivision approval request.

On February 12, 1999, Dubois Dutch commenced a legal action against Guido in the Clearfield County Court of Common Pleas, seeking specific performance of the Option. As a defense to specific performance, Guido asserted that he could not perform his contractual duty because subdivision of the property would violate the 1996 Zoning Ordinance. Additionally, Guido countersued for ejectment, seeking possession of the Restaurant Parcel free of any claim by Dubois Dutch. Dubois Dutch filed preliminary objections to the ejectment action, raising the pendency of its prior action for specific performance, pursuant to Pa.R.C.P. 1028(a)(6).5 On May 17, 1999, following a hearing, in an apparent effort to effectuate an amicable resolution of the parties’ dispute, the trial court directed Dubois Dutch to apply, once again, to the Planning Commission seeking approval of a formal subdivision of the Property. The trial court also issued an order staying all litigation pending a decision by the Planning Commission on the subdivision approval request it directed Dubois Dutch to submit.6

Pursuant to the court’s direction, Dubois Dutch reapplied to the Planning Commission.7 In due course, Dubois Dutch raised two principal arguments: first, that the 1982 Lease and [98]*98Option effected a per se lawful subdivision at inception; or second, that upon Dubois Dutch’s exercise of the Option, its ownership interest would relate back to 1982 and thus be governed by the 1964 Zoning Ordinance, such that even if the 1996 Zoning Ordinance applied, Guido’s Gas Station Parcel should win approval as a pre-existing non-conforming lot8 with a pre-existing non-conforming ongoing business situate thereon. On June 13, 1999, the Planning Commission agreed and approved Dubois Dutch’s request for formal subdivision.9

On August 3, 1999, Guido filed an appeal from the Planning Commission’s decision with the Clearfield County Court of Common Pleas. On June 13, 2000, the trial court held a de novo hearing. The court found that the creation of the 1982 Lease and Option and Dubois Dutch’s attempt to execute the Option constituted a Subdivision of the property under the MPC as of June 1982. The trial court noted that equitable title of property subject to a lease coupled with a purchase option passes, upon exercise of a purchase option, not as of the date of exercise, but rather as of the date of option creation. Thus, it concluded that the 1965 Subdivision Ordinance governed.10 Trial Ct. Op. at 8-9.

[99]*99The court then considered the 1965 Subdivision Ordinance’s requirement that the lots resulting from a Subdivision must “comply with the minimum requirements of the Sandy Township Zoning Ordinance.” Trial Ct. Op. at 13 (quoting 1965 Subdivision Ordinance § 611(A)). Concluding that the “minimum requirements” could be satisfied by use of the Zoning Ordinance’s exceptions, such as pre-existing non-conforming lots, the court held that the Gas Station Parcel satisfied the definition of non-conforming use because its lot size was “lawful” under the 1964 Zoning Ordinance, even if the property had not been formally Subdivided. Accordingly, the trial court held that the Gas Station Parcel constituted a permissible pre-existing non-conforming lot under the 1996 Zoning Ordinance. The court entered an order approving Dubois Dutch’s Subdivision application. Guido timely appealed that decision to the Commonwealth Court.

A three-judge panel of the Commonwealth Court reversed the trial court by a vote of two to one.11 See Guido v. Township of Sandy, 809 A.2d 1036 (Pa.Cmwlth.2002). The majority found that a leasehold interest coupled with an option to purchase does not create a Subdivision of the property and, therefore, Dubois Dutch could not effectively “lock-in” the Gas Station Parcel as a pre-existing non-conforming lot by exercising its option to purchase a portion of the property after the 1996 Zoning Ordinance took effect. The Commonwealth Court held:

There is simply no legal authority, or reason, to hold that the potential right to exercise an option to purchase, created by a lease in 1982, which Dubois Dutch did not seek to exercise until 1999, created a subdivision in 1982 under an ordinance which was no longer in existence when the option was exercised. In this case, Dubois Dutch’s right to pursue subdivision approval was no different in 1982 than it was in 1998, when it finally initiated its first request before the Township Supervisors.

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Bluebook (online)
880 A.2d 1220, 584 Pa. 93, 2005 Pa. LEXIS 1798, Counsel Stack Legal Research, https://law.counselstack.com/opinion/guido-v-township-of-sandy-pa-2005.