Res Judicata and Collateral Estoppel where Companion Case not Appealed

In Re: Appeal of Coatesville Area Sch Dist., 216 A.3d 539 (Pa. Cmwlth. 2019), allocatur granted Feb. 6, 2020, appeal docket 7 MAP 2020

The Pennsylvania Supreme Court granted allocatur in this case to determine whether Commonwealth Court erred in applying res judicata and collateral estoppel where a companion case was not appealed.

This case arises from Huston Properties, Inc. (Huston)’s application for a real estate tax exemption claiming that its property, located in the City of Coatesville (City), was regularly used as an institution of purely public charity. After hearing, the Chester County Board of Assessment (Board) granted a partial exemption for the 2014 tax year. Both the Coatesville Area School District (District) and the City filed separately docketed appeals from the Board’s decision. The District filed a notice of intervention in City’s cross-appeal and Huston responded with cross-appeals under the two docket numbers. Upon agreement of all parties, the trial court ordered that the dual cross-appeals from the Board be “consolidated for trial,” however the trial court did not consolidate the cases as a single case under a common docket number. Rather, the trial court issued identical orders under the separate trial court docket numbers affirming the Board’s decision. In consolidated appeals, Commonwealth Court found that the trial court’s initial findings of fact and conclusions of law were insufficient to resolve the issue of whether the Property was used as a “purely public charity” and remanded the cases to the trial court for further consideration. After remand the trial court issued two essentially identical, but differently captioned, decisions and orders under the separate docket numbers.

The District appealed the decision and order under one docket and Huston cross-appealed. Neither City, nor District, nor Huston appealed the decision and order in the City’s companion case. Before Commonwealth Court, Huston filed an application to quash District’s appeal because of the un-appealed trial court decision in the companion case. Following argument, Commonwealth Court determine that the companion decision and order that were not appealed have preclusive effect and dismissed the appeals, reasoning that:

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. 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.” Slater v. Slater, 94 A.2d 750, 751 (Pa. 1953) (emphasis added) [quoting Hochman v. Mortg. Fin. Corp. of Pa., 137 A. 252, 253 (Pa. 1927)]. While this case procedurally differs from Slater and Hochman, the rationale of those cases still applies—the ultimate and controlling issues were decided in a prior proceeding in which District actually had—and availed itself of—an opportunity to participate and assert its rights.

Similarly, the cross-appeals are barred by the doctrine of collateral estoppel, 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.

Slip op. at 5-6.

The Supreme Court granted allocatur to examine:

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?

For more information, contact Kevin McKeon or Dennis Whitaker.