S. Bethlehem Assoc. v. ZHB of Bethlehem Twp

• Court: Supreme Court of Pennsylvania
• Decided: May 16, 2023
• Docket: 41 MAP 2022
• Status: Published

Opinion

[J-81-2022] IN THE SUPREME COURT OF PENNSYLVANIA MIDDLE DISTRICT

TODD, C.J., DONOHUE, DOUGHERTY, WECHT, MUNDY, BROBSON, JJ.

SOUTH BETHLEHEM ASSOCIATES, LP : No. 41 MAP 2022 : : Appeal from the Order of the v. : Commonwealth Court dated January : 29, 2021 at No. 321 CD 2020 : Affirming the Order of the Court of ZONING HEARING BOARD OF : Common Pleas of Northampton BETHLEHEM TOWNSHIP, : County dated February 14, 2020 at PENNSYLVANIA : No. C48-CV-2019-6785 : : ARGUED: November 30, 2022 v. : : : CENTRAL PA EQUITIES 30, LLC : : : APPEAL OF: SOUTH BETHLEHEM : ASSOCIATES, LP :

OPINION

JUSTICE MUNDY DECIDED: May 16, 2023 In this discretionary appeal, a local zoning board granted a request for variances

needed by a property owner to build a hotel on the subject property. The owner of a

competing hotel, who opposed the grant of such relief, was permitted to appear before

the board, cross examine witnesses, and provide oral argument. The question presented

is whether that party had standing to seek judicial review of the board’s subsequent ruling.

Appellee Central PA Equities 30, LLC (“Central”) owns the subject property, an

approximately 3.5-acre parcel in Bethlehem Township, Northampton County, located in a Light Industrial/Office Campus (Phased) Zoning District, which permits a hotel use as

of right. Central wants to construct a four-story, 107-room hotel on the property. The

hotel would be about two blocks away from an existing hotel owned by Appellant South

Bethlehem Associates, LP.

The subject property is bordered on the north and east by public rights of way. It

is bordered on the west by a residential neighborhood known as Madison Farms. Under

the local zoning code, construction on the property is subject to certain constraints: there

must be fifty-foot setbacks from the rights of way and a 150-foot setback from the lot lines

of any dwelling. Also, earth berms are required on the Madison Farms side as a buffer

between the hotel and the residences.

If Central were to comply fully with the setback requirements, the buildable portion

of the property would be a small triangular area comprising eleven percent of the subject

property, which would be too small to build a viable hotel. Also, constructing earth berms

on the Madison Farms side would be impractical because a utility easement for power

lines on that side precludes grading changes. In view of these limitations, Central applied

to the Zoning Hearing Board of Bethlehem Township, requesting a dimensional variance

which would allow it to utilize a 74-foot setback from the residences (thus, a 76-foot

variance), as well as a waiver of the earth-berm mandate.

The Board held a hearing on these requests, at which Central presented the

testimony of a professional engineer and a hotel manager. Central also submitted a

number of exhibits in support of its application for relief. Appellant’s counsel, Timothy

Stevens, Esq., appeared at the hearing and signed in on the appropriate form as an

objector. Central objected to his participation because Appellant’s hotel was 1,000 feet

away, and hence, it was not within a 400-foot radius of the subject property so as to have

been entitled under the zoning code to notice of the hearing. Central posited, moreover,

[J-81-2022] - 2 that Appellant was only appearing as a business competitor to oppose the construction

of a nearby hotel. Thus, Central argued Appellant lacked standing to oppose the

requested variances. Attorney Stevens countered that Appellant had a “definite interest

in the construction of a hotel that is just two blocks away” from its existing hotel. N.T.,

5/29/19, at 14.

The Board overruled Central’s objection. The Board’s solicitor explained that,

under the Municipalities Planning Code (MPC), when Attorney Stevens “entered his

appearance on the objector sheet,” he became “a party of record.” Id. at 34-35. In this

regard, the solicitor noted that per the MPC, even if the objector’s property was “on the

other side of the township,” he could still be a party of record. Id. at 35. See generally

53 P.S. § 10908(3) (relating to party status at zoning board hearings). Attorney Stevens

did not call any witnesses but he did cross-examine Central’s witnesses and provide oral

argument in opposition to the variances at the close of the hearing.

The Board ultimately issued a unanimous written decision granting the requested

variances. 1

Appellant appealed to the county court, and Central intervened, defending the

Board’s substantive decision and arguing Appellant lacked standing. The court ruled

against Central on the question of standing, concluding that Appellant had standing to

1 In its findings of fact, the Board stated, among other things, that: the proposed hotel would have less of an impact on the surrounding area than a warehouse and office building that had previously been approved for the property (but not built); the relief was necessary to enable the reasonable use of the property; due to the unique shape and topography of the parcel, Central demonstrated an unnecessary hardship that it did not create; an earth berm was unnecessary because the adjacent residential properties would be protected from traffic noise through the natural slope of the real estate, appropriate buffering vegetation including a hedge row, and the preservation of existing mature trees; the dimensional variance, if authorized, would be the minimum variance that could afford relief; and construction of the hotel would not substantially impair the appropriate use or development of adjacent property.

[J-81-2022] - 3 appeal as it had timely appeared before the Board as an objector and was presumed to

be affected by the variance requests as it owned a nearby property. 2 The court did,

however, affirm the Board’s decision on the merits.

Appellant appealed to the Commonwealth Court. In an unpublished decision, the

court affirmed the county court’s order on the grounds Appellant lacked standing. 3 It

reasoned zoning appeals may not be utilized solely as a method to deter free competition,

and it relied for this position on In re Farmland Industries, 531 A.2d 79 (Pa. Cmwlth. 1987),

which in turn referenced a now-replaced provision of the MPC that allowed appeals to

court by “aggrieved” persons. See 53 P.S. § 11007 (repealed). The court concluded that

Appellant failed to show aggrievement at the hearing because the asserted impact upon

its interest stemmed not from the variances themselves but from the competition that

would arise from the proposed new hotel. As such, the court did not reach Appellant’s

substantive arguments challenging the Board’s decision to grant the variances.

We granted allocatur limited to whether the Commonwealth Court erred in holding

that Appellant lacked standing to seek judicial review. See S. Bethlehem Assocs. v. ZHB

of Bethlehem Twp., 275 A.3d 484 (Pa. 2022) (per curiam).

Ordinarily, standing to initiate judicial proceedings depends on the litigant being

adversely affected in some way. See Wm. Penn Parking Garage v. City of Pittsburgh,

346 A.2d 269, 280 (Pa. 1975). To assess whether a litigant is affected in a manner the

law recognizes, courts “consider whether the litigant has a substantial, direct, and

2See S. Bethlehem Assocs. v. ZHB of Bethlehem Twp., No. C48-CV-2019-6785, slip op. at 7 (C.P. Northampton Feb. 14, 2020) (citing Grant v. ZHB of Penn Twp., 776 A.2d 356, 358-59 (Pa. Cmwlth. 2001); Johnson v. ZHB of Richland Twp., 503 A.2d 1117, 1119 n.1 (Pa. Cmwlth. 1986); Baker v. ZHB of W. Goshen, 367 A.2d 819, 822-23 (Pa. Cmwlth. 1986)).

3See S. Bethlehem Assocs. v. ZHB of Bethlehem Twp., No. 321 C.D. 2020, 247 A.3d 1198, 2021 WL 303046 (Pa. Cmwlth. Jan. 29, 2021) (Table).

[J-81-2022] - 4 immediate interest in the matter.” Markham v. Wolf, 136 A.3d 134, 140 (Pa. 2016). This

occurs when “the party’s interest surpasses that of the general public in procuring

obedience to the law, the harm alleged was caused by the matter complained of, and the

harm is not remote and speculative.” Trust Under Ashton’s Will, 260 A.2d 81, 88 (Pa.

2021).

The same is not necessarily true of local administrative proceedings. Section

908(3) of the MPC indicates standing to appear before a local zoning board considering

an application for a variance, and to present evidence and cross-examine witnesses in

relation to the application, is broader than aggrieved-person standing as outlined above.

That provision states:

The parties to the [zoning board] hearing shall be the municipality, any person affected by the application who has made timely appearance of record before the board, and any other person including civic or community organizations permitted to appear by the board. The board shall have power to require that all persons who wish to be considered parties enter appearances in writing on forms provided by the board for that purpose. 53 P.S. § 10908(3). By its terms the provision accords objector status to certain persons

who have entered their appearances in writing on the appropriate form – which Appellant

did in the present case. The “any other person” language is quite broad, and while we

need not determine its limits (if any) at this juncture, the record reflects Appellant attained

objecting-party status before the Board pursuant to this provision. See N.T., 5/29/19, at

34-35. It is a separate question whether such party status automatically transfers intact

to the arena of judicial review. 4

4 The dissent references In re Larsen, 616 A.2d 529 (Pa. 1992), to support its assertion that this Court has previously indicated standing to seek judicial review follows automatically from a party’s “unsuccessful participation” before a zoning board. Dissenting Op. at 17. In Larsen, this Court issued a per curiam order imposing a public reprimand upon former Justice Larsen, and accepting a report written by the Judicial Inquiry and Review Board. However, the portion of Larsen cited by the dissent does not (continued…)

[J-81-2022] - 5 In terms of policy, it is possible that, in enacting Section 908(3), the General

Assembly wanted to avoid the need for mini-hearings on aggrievement before local

zoning boards. It is also possible the General Assembly wanted to allow for a broad range

of views for and against the relief sought without regard to aggrievement, so as to fully

inform the board on the merits of the proposed variance. Cf. 2 Pa.C.S. §554 (providing

local agencies are not bound by technical rules of evidence at their hearings). But even

if the Legislature’s intent was to avoid such delays and limitations before local zoning

boards, it does not follow that it sought to do away with the need for aggrievement as a

predicate to an appeal to a court of law, whose jurisprudential interests and procedures

are not identical to those of a local administrative body.

For its part, Appellant places heavy reliance on MPC Section 908(9), 53 P.S.

§ 10908(9). See, e.g., Brief for Appellant at 11. That is a lengthy subsection dealing in

part with land use applications deemed approved by operation of law due to the board’s

failure to take timely action. Its final sentence states: “Nothing in this subsection shall

prejudice the right of any party opposing the application to appeal the decision to a court

of competent jurisdiction.” 53 P.S. § 10908(9). But this is not an affirmative grant of

appellate rights. It indicates nothing in subsection 908(9) should be interpreted to negate

such rights, but it does not purport to grant any such rights either.

Moreover, Section 908(9), as well as 908(3), appear in Article IX of the MPC,

whereas judicial review of zoning board decisions is governed by Article X-A. See 53

P.S. §11001-A (“The procedures set forth in this article shall constitute the exclusive

contain analysis by this Court, but by the Judicial Inquiry and Review Board. This Court did not expressly adopt all of the report’s legal analysis as our own. As such, its status as Pennsylvania Supreme Court precedent is not entirely clear. Cf. Commonwealth v. Tilghman, 673 A.2d 898, 904 (Pa. 1996) (observing a per curiam affirmance by this Court does not create Supreme Court precedent; this Court must expressly affirm on the basis of the lower court’s opinion in order to do so).

[J-81-2022] - 6 mode for securing review of any decision rendered pursuant to Article IX . . ..”). Article

X-A, however, is silent on the prerequisites for appealing to court. It includes provisions

specifying that such appeals are to be taken to the court of common pleas in the district

where the land is located, see 53 P.S. § 11002-A(a); that such appeals must be filed

within 30 days after the order is entered or the date upon which notice of a deemed

decision is given, see id.; that appeals based on an alleged procedural defect may only

be taken by a person who establishes that the zoning decision has resulted (or could

result) in a property use that directly affects the person’s substantive property rights, see

id. § 11002.1-A(c); and many other provisions governing various aspects of appeals to

court. The General Assembly also knew how to define the class of parties permitted to

appeal to court generally, but it chose not to do so. The most probable reason, in our

view, is that the Legislature intended for the courts of this Commonwealth to determine

for themselves who would possess standing to initiate judicial proceedings to review a

final decision rendered by a local zoning board. 5

5The Local Agency Law, see Act of Apr. 28, 1978, P.L. 202, No. 53, § 5 (as amended 2 Pa.C.S. §§ 551-554, 751-754), applies “to all local agencies,” 2 Pa.C.S. §551, which are defined as any government agency other than a Commonwealth agency, see id. §101. This description encompasses municipal zoning boards. As such, it has previously been applied to appeals from zoning board rulings. See, e.g., Money v. Bd. of Supervisors of Westtown Twp., 89 A.3d 308, 312 (Pa. Cmwlth. 2014); Nernberg v. City of Pittsburgh, 620 A.2d 692, 694 (Pa. Cmwlth. 1993); see also Metal Green, Inc. v. City of Phila., 266 A.3d 495, 515 (Pa. 2021) (plurality) (indicating that the Local Agency Law “governs review of adjudications by zoning hearing boards”).

We do not decide at present whether it controls as to the case sub judice, as neither Central nor the Board mention it as a basis to find a lack of standing. We note in passing, however, that its appeal-to-court provision contains an aggrievement prerequisite, see 2 Pa.C.S. § 752 (“Any person aggrieved by an adjudication of a local agency who has a direct interest in such adjudication shall have the right to appeal therefrom to the court vested with jurisdiction of such appeals . . ..”), which is similar to the traditional standing test that we ultimately conclude pertains here. See, e.g., Scott v. City of Phila. ZBA, 126 (continued…)

[J-81-2022] - 7 Standing exists as a jurisprudential doctrine to protect the courts and the public

from improper plaintiffs. See Firearm Owners Against Crime v. Papenfuse, 261 A.3d 467,

481 (Pa. 2021). An improper plaintiff is one who has no legally enforceable interest

affected by the matter complained of. See Application of Beister, 409 A.2d 848, 850 n.2

(Pa. 1979). The “legally enforceable” qualifier is important because an interest may be

harmed, but it may not be the type of interest the law protects. See generally Nernberg

v. City of Pittsburgh, 620 A.2d 692, 695 (Pa. Cmwlth. 1993) (explaining that, to establish

standing to seek judicial review as an “aggrieved person” under the Local Agency Law, a

litigant must demonstrate that the interest harmed “is one which the law is intended to

protect”) (citing Wm. Penn, 346 A.2d at 284).

Thus, in In re Hickson, 821 A.2d 1238 (Pa. 2003), the plaintiff filed a private criminal

complaint in an effort to initiate a prosecution which he believed would have given him an

advantage in an upcoming election and in a prospective civil suit. These interests of the

litigant would have been advanced by a prosecutorial decision to proceed against the

alleged offender based on the private complaint, and these interests were accordingly

harmed by the district attorney’s decision not to act. When the plaintiff sought judicial

review of the district attorney’s decision, we did not consider such harm sufficient to give

him standing. See id. at 1245. Similarly, the federal courts have held that harm to

ideological interests alone is insufficient to confer Article III standing. See, e.g.,

Competitive Enter. Inst. v. Nat’l Highway Traffic Safety Admin., 901 F.2d 107, 112 (D.C.

Cir. 1990) (citing Sierra Club v. Morton, 405 U.S. 727, 739 (1972)); accord O’REILLY,

ADMINISTRATIVE RULEMAKING § 15:50 (2022 ed.).

A.3d 938, 940 (Pa. 2015); Pittsburgh Trust for Cultural Res. v. Pittsburgh ZBA, 604 A.2d 298, 301-02 (Pa. Cmwlth. 1992).

[J-81-2022] - 8 Being free from market competition is similar: it is in the interest of the established

hotel, Appellant herein, to maintain market share and pricing without a new hotel cropping

up two blocks away, but that is not the type of interest the law recognizes as enforceable

in court. The reason is based in public policy, which protects market competition but not

market competitors – at least not from competition. Hence, such an interest cannot be

the basis for a claim to aggrievement for purposes of standing to commence a lawsuit.

Extending Section 908(3) of the MPC, which relates to standing to appear before a zoning

board considering a land use application, to the arena of judicial review would be contrary

to such policy. In this respect, the Commonwealth Court appropriately referred to a

passage from its Farmland Industries decision which states:

It is clear . . . that Farmland is using this process to impede the location of a competitor in its trading area. We cannot allow zoning appeals to be used as a method to deter free competition. Id. at 84. Even though the statutory provision applicable in Farmland Industries has been

repealed, it remains a valid policy objective to prevent the zoning appeals process from

being misused for the sole purpose of hindering market competition, and that objective

informs our interpretation of the MPC. See 1 Pa.C.S. § 1922(5) (providing the General

Assembly favors the public interest over any private interest). 6

Here, it is undisputed that Appellant’s sole motive for opposing the variance is that

its financial interests would be affected by having to compete for business with Appellee’s

6 We do not overlook Appellant’s argument that Section 11007 was “replaced” by Section 10908, which in turn “broadened the standing of a party” to appeal to court. Brief at 11. We just disagree. As developed above, Section 10908 does not appear in Article X-A and it relates only to standing to appear before a local zoning board. And the General Assembly is presumed to have been aware of our longstanding test for standing to seek judicial review when it made that legislative change. Because the requirement of standing serves important policy objectives as summarized above, if the General Assembly intends to override that requirement it will have to say so more explicitly; Article X-A’s silence on the issue is an insufficient basis to conclude that that was the Legislature’s intent.

[J-81-2022] - 9 proposed hotel. Appellant was allowed to make its case to the zoning board consistent

with the MPC’s liberal allowance of party status before that administrative body. But it

does not follow that the MPC or this Court’s standing jurisprudence must recognize a right

in favor of Appellant to continue its opposition through an appeal to court. Such would

allow Pennsylvania’s judicial machinery to be used in service of a business’s effort to be

free from competition to the detriment of the traveling public.

In sum, then, we hold that a party who appears before a zoning board may only

appeal an adverse decision to court if that party has standing per this Court’s traditional

understanding of the concept. Such is consistent with our decision in Hickson, where

Rule of Criminal Procedure 506 (then-Rule 106) was silent with regard to a citizen’s

standing to seek judicial review of prosecutorial inaction on a private criminal complaint.

We held that such silence did not negate the ordinary requirement of standing to institute

judicial proceedings. See Hickson, 821 A.2d at 1243. Further, we find in this matter that

Appellant lacked standing to appeal, as its only interest affected by the zoning board’s

ruling was its desire to suppress competition in the open market.

The order of the Commonwealth Court is affirmed.

Chief Justice Todd and Justice Dougherty join the opinion.

Justice Donohue files a dissenting opinion in which Justice Wecht joins.

Justice Brobson did not participate in the consideration or decision of this matter.

[J-81-2022] - 10