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The Pennsylvania Supreme Court is poised to explore the limits of the doctrines of res judicata and collateral estoppel in a dispute in which only one of two nearly identical tax assessment matters proceeded on appeal.

In In re Appeal of the Coatesville Area School District From the Decision of the Chester County Board of Assessment Appeals for the Property Located at 50 South First Avenue, City of Coatesville, Chester County, Pennsylvania Property Tax Parcel No. 16-05-0229.0000, the high court granted allocatur Feb. 10 to review a Commonwealth Court decision that dismissed cross-appeals because a very similar companion case in the Chester County Court of Common Pleas was never appealed and was, therefore, final.

The case began with an application for a real estate tax exemption by Huston Properties, which argued that a property it owned in Coatesville was subject to a tax exemption because it was regularly used as an institution of purely public charity, according to the Commonwealth Court's Aug. 7, 2009, opinion. The Chester County Board of Assessment granted a partial exemption of 72% for the 2014 tax year and both the Coatesville Area School District and the city of Coatesville filed separately docketed appeals. The school district then intervened in the city's case and Huston filed cross-appeals in both matters. While the parties agreed to consolidate the dual matters for trial, they were never moved under a common docket number.

Following a trial, the trial judge issued identical orders under both docket numbers, affirming the board's decision, but the Commonwealth Court remanded the matter after determining that the trial court's initial findings of fact and conclusions of law were insufficient.

On remand, the trial court issued two nearly identical decisions and orders under the separate docket numbers and with different captions, but the district appealed only the decision and order in the case it initially filed, and Huston cross-appealed only in that matter. No appeal was taken from the decision and order in the separately docketed matter.

Writing for the Commonwealth Court, Senior Judge Bonnie Brigance Leadbetter, pointing to the doctrines of res judicata and collateral estoppel, wrote that "the companion decision and order that were not appealed have preclusive effect and therefore we must dismiss these appeals."

According to Leadbetter, technical res judicata precludes a matter from proceeding when there is a separate matter that shares the "(1) identity of the thing sued upon or for; (2) identity of the causes of action; (3) identity of the persons or parties to the action; and (4) identity of the quality or capacity of the parties suing or being sued."

"Between the appealed decision and order in the district's case and the un-appealed decision and order in the city's case, there is clearly identity of the thing sued upon, identity of the cause of action, and identity of the quality or capacity of the parties being sued," said Leadbetter, joined by Judges Renee Cohn Jubelirer and Michael Wojcik. "Moreover, as noted above, district intervened in the city's case and fully participated in the joint trial. Our Supreme Court has long held that in applying res judicata '[t]he thing which the court will consider is whether the ultimate and controlling issues have been decided in a prior proceeding in which the present parties actually had an opportunity to appear and assert their rights.'"

Similarly, Leadbetter explained, collateral estoppel bars parties from relitigating  "(1) an issue decided in a prior action is identical to one presented in a later action; (2) the prior action resulted in a final judgment on the merits; (3) the party against whom collateral estoppel is asserted was a party to the prior action, or is in privity with a party to the prior action; and (4) the party against whom collateral estoppel is asserted had a full and fair opportunity to litigate the issue in the prior action."

The appeal in the district's case was precluded by collateral estoppel, Leadbetter said, "as it is clear that the issue in the city's un-appealed companion case is identical to the one involved in the instant cross-appeals, that the companion case resulted in a final judgment on the merits, and that district had a full and fair opportunity to appeal the decision and order in that case."

In its Feb. 6 allocatur grant, the Supreme Court agreed to consider a single issue raised on appeal by the school district: "Whether the Commonwealth Court erred in applying the doctrines of technical res judicata and collateral estoppel when dismissing petitioner's appeal because a companion case, subject to similar decision and order issued by the trial court, was not appealed?"

Counsel for the school district, Justin Barbetta of Sweet, Stevens, Katz & Williams in New Britain, could not be reached for comment.

Huston's attorney, John Fiorillo of Unruh, Turner, Burke & Frees in West Chester, also could not be reached.