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An appeals court has upheld the dismissal of Allegheny County property owners’ challenge to the municipality’s ability to adjust property taxes based on current market values, but said the property owners still have another recourse.

On Aug. 14, the Commonwealth Court affirmed an Allegheny County trial court’s dismissal of a putative class action filed by Joseph Nissim Martel and Ester Martel seeking relief from property reassessments ordered by the Allegheny County Board of Assessment Appeals and Review. But whereas the trial court tossed the case for lack of legal sufficiency, the appeals court dismissed the complaint because the plaintiffs failed to exhaust their statutory remedies before bringing the matter to the courts. Instead, the appeals panel said, the Second Class County Assessment Law requires the plaintiffs to first challenge the reassessments before the board.

According to Commonwealth Court Judge Christine Fizzano Cannon’s precedential opinion, the board ordered the reassessments based on appeals brought by the Pittsburgh public school district, Allegheny County and the city of Pittsburgh. The board introduced evidence of current market values to support their request for increased assessments.

After reassessment, the Martels’ property value rose from $464,700 to $690,000. They subsequently filed a class action, alleging the taxing authorities “have initiated assessment appeals similar to the Martels’ appeal on ‘approximately 200 or more’ properties recently sold in Allegheny County, and have accepted ‘the increased tax revenues associated with the same,’” Cannon said. The Martels contested the taxing authorities’ power to bring the appeals and to rely on current market values. They argued that doing so violated the Allegheny County Home Rule Charter and Optional Plans Law, and the uniformity clause of the Pennsylvania Constitution, according to Cannon.

The trial court dismissed the plaintiffs’ complaint by sustaining the board and school district’s objection that the Allegheny Administrative Code and Board Rule the Martels relied upon violate state law, making their complaint “legally insufficient,” Cannon said.

The parties then appealed.

“Before this court, the parties present several arguments addressing the trial court’s analysis, including the validity of the Administrative Code and Board Rule. However, we do not reach those arguments,” Cannon said. “Though we conclude that the trial court correctly dismissed property owners’ complaint, the trial court did not have the authority to address the legal issues raised therein because the appeals process provided in the Assessment Law enables property owners to obtain the relief they seek.”

“Property owners had to exhaust the appeals process provided by the Assessment Law before bringing their complaint to the trial court as reflected in basic legal principles,” Cannon said. “If a party fails to pursue a statutory remedy, the court is without power to act until the statutory remedies have been exhausted, even in cases where a constitutional question is presented.”

The Martels are represented by Edward Friedman of Friedman & Friedman in Pittsburgh. Friedman said that he has filed a petition for allowance of appeal to the state Supreme Court.

Ira Weiss of Weiss Burkardt Kramer in Pittsburgh represents the taxing authorities and did not respond to a request for comment.