STENGEL, District Judge.
This case involves a private real estate developer's efforts to build a World Trade Center along the Delaware River in Philadelphia. The developer, Waterfront Renaissance Association ("WRA"), contends the City thwarted the project by changing its zoning laws and by imposing certain unfair requirements through its Planning Commission. Several claims have already been dismissed. The parties filed cross motions for summary judgment on Count XVI, which alleges the City's Central Delaware Riverfront Overlay District and plan of development regulations are unconstitutional. The City also seeks summary judgment on WRA's promissory estoppel and detrimental reliance claims (Count III and IV) and WRA's claim for Unjust Enrichment (Count VIII). For the reasons discussed in this memorandum opinion, I will grant the City's motions and deny the Plaintiff's.
Waterfront Renaissance Associates is a Pennsylvania limited partnership seeking to develop a "major World Trade Center"
In March 2001, after a series of cooperative efforts involving the Delaware River Port Authority (DRPA), WRA and the City, the Pennsylvania Department of Community and Economic Development granted Keystone Opportunity Zone ("KOZ") status to WRA's site, and eleven and a half (11.5) acres of City-owned property around it. KOZ status confers tax abatements at the state and local levels for qualified businesses that lease real property in the KOZ. The KOZ distinction made the property more valuable and would, presumably, attract new businesses to the site. WRA expended resources to obtain the application, including hiring a lobbyist, Steven Wojcik and Associates, to promote the granting of KOZ status. (Oral Argument Transcript Doc. #239 at 34 ¶¶ 17-25).
On March 5, 2009, Philadelphia City Councilman Frank DiCicco introduced Bill 090170-A, which the City Council approved, to create a zoning overlay ("CRO") for the Central Delaware Riverfront Overlay District.
On September 16, 2010, the Planning Commission filed the revised POD Regulations with the Philadelphia Department of Records. The revised POD Regulations became effective at midnight on September 27, 2010 pursuant to Section 8-407 of the Philadelphia City Charter. (Doc. #211 at ¶ 304). Subsection 13 of the CRO states that the Planning Commission shall approve a POD "only if the Commission has determined, in its discretion, that the Plan of Development provides for development appropriate in scale, density, character and use for the surrounding community." (Doc. #211 at ¶ 311; Exhibit J at 5-6). The parties' main contention is whether the CRO and POD Regulations are overly vague or result in arbitrary and capricious application.
WRA commenced this civil action in February 2007 by filing a fourteen-count complaint in the Court of Common Pleas of Philadelphia County against the City of Philadelphia, the Civic Associations for the surrounding neighborhoods, and a number of individual defendants. The defendants removed the case to this court on March 15, 2007. The original Complaint challenged a March 2006 ordinance that extended a 65 foot height restriction to the area north of Old City, which included property owned by Waterfront Renaissance.
The individual defendants were dismissed on 12(b)(6) motions, which left only the claims against the Civic Association and the City. Waterfront Renaissance Assocs. v. City of Philadelphia, 2008 WL 862705, 2008 U.S. Dist. LEXIS 25868 (E.D.Pa. Mar. 31, 2008). In 2011, the Civic Associations' Motion for Summary Judgment was granted. CMR D.N. Corp. v. City of Phila., 2011 U.S. Dist. LEXIS 25392 (E.D.Pa. Mar. 10, 2011). Additionally, in 2011, the constitutional challenge to the March 2006 ordinance was dismissed as moot. CMR D.N. Corp. v. City of Phila., 2011 U.S. Dist. LEXIS 25387 (E.D.Pa. Mar. 10, 2011).
WRA has since filed an amended complaint solely against the City of Philadelphia challenging the new ordinance and the POD and maintaining claims for promissory estoppel and unjust enrichment. (Doc. #211). The City then filed a motion for summary judgment on July 29, 2011 (Doc. #223
Summary judgment is appropriate "if the movant shows that there is no genuine dispute as to any material fact and that the movant is entitled to judgment as a matter of law." FED. R. CIV. P. 56(a). A dispute is "genuine" when "a reasonable jury could return a verdict for the non-moving party" based on the evidence in the record. Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248, 106 S.Ct. 2505, 91 L.Ed.2d 202 (1986). A factual dispute is "material" when it "might affect the outcome of the suit under the governing law." Id.
Under Rule 56 of the Federal Rules of Civil Procedure, the court must draw "all justifiable inferences" in favor of the non-moving party. Anderson, 477 U.S. at 255, 106 S.Ct. 2505. The court must decide "not whether ... the evidence unmistakably favors one side or the other but whether a fair-minded jury could return a verdict for the plaintiff on the evidence presented." Id. at 252, 106 S.Ct. 2505. If the non-moving party has produced more than a "mere scintilla of evidence" demonstrating a genuine issue of material fact, then the court may not credit the moving party's "version of events against the opponent, even if the quantity of the [moving party's] evidence far outweighs that of its opponent." Big Apple BMW, Inc. v. BMW of N. Am., Inc., 974 F.2d 1358, 1363 (3d Cir.1992).
The plaintiff contends the Central Riverfront Overlay District ("CRO") regulations and the Planning Commission's Plan of Development ("POD") provisions are unconstitutional. Specifically, WRA alleges the CRO and the POD regulations violate the principles of substantive due process and equal protection. The City contends that these claims are not ripe and have no merit.
The ripeness doctrine "serves to determine whether a party has brought an action prematurely[.]" Khodara Envtl. Inc. v. Blakey, 376 F.3d 187, 196 (3d Cir. 2004). In land-use cases, a property owner's constitutional claim will not be ripe until the zoning authorities have had an opportunity to arrive at a final, definitive position regarding the application of the regulations at issue. See Sameric Corp. of DE v. City of Philadelphia, 142 F.3d 582 (3d Cir.1998); Acierno v. Mitchell, 6 F.3d 970, 975 (3d Cir.1993); Hoehne v. Cnty of San Benito, 870 F.2d 529, 533 (9th Cir. 1989). Under this "finality rule," a plaintiff property owner must prove that a "final decision has been reached by the agency before it may seek compensatory or injunctive relief in federal court on federal constitutional grounds." Acierno, 6 F.3d at 975. The finality rule, however, does not apply to facial challenges because a facial challenge argues "any application of the regulation is unconstitutional."
WRA asserts a claim against a provision of the ordinance, which requires developers to submit a POD to the Planning Commission for approval.
The fact that WRA asserts a facial challenge to the ordinance meets the basic test to withstand summary judgment on this issue because the Third Circuit has held that facial challenges to ordinances ripen at the time of enactment. See County Concrete Corp., 442 F.3d at 164. Even if WRA did not seek a variance from the zoning ordinance, the Third Circuit has maintained that this type of facial attack is ripe for adjudication. See Id. at 256. Accordingly,
The Fourteenth Amendment to the United States Constitution prohibits deprivations "of life, liberty, or property, without due process of law." U.S. Const. amend. XIV, § 1. To prevail on a substantive due process claim, a Plaintiff must demonstrate that an arbitrary and capricious act deprived him of a protected property interest.
A second way to prevail on a claim that an ordinance is unconstitutional requires a plaintiff to demonstrate that that an enactment is void for vagueness. It is a basic principle of due process that an enactment is void for vagueness if its prohibitions are not clearly defined.
WRA alleges that the CRO and POD regulations violate the principle of substantive due process because the review is impermissibly vague, is arbitrary and capricious, and is unrelated to any legitimate planning purpose.
The City alleges that WRA has no vested property interest and, therefore, cannot allege a substantive due process violation.
The City's ordinance appears to be rationally related to the goal of the integrity and consistency of appropriate development. WRA has failed to produce any evidence to the contrary. Its only argument is that the structure of the CRO would allow for nothing other than arbitrary and subjective approval because the ordinance does not define its terms using objective criteria. There is simply no merit to the "impermissible discretion" argument. It would be impossible for a zoning ordinance to identify specifically each and every permitted use. A degree of discretion is necessary and is entirely consistent with the long history of land use law in Pennsylvania. Such discretion does not render the zoning ordinance unconstitutionally vague.
WRA had fair notice that the property was subject to a zoning ordinance. The ordinance in question contains standards and uses which are appropriately delineated in commonplace terms and categories. The POD also references specific legislative
Generally, the Fourteenth Amendment protects individuals only against government action, unless the state has delegated authority to a private party, thereby making the actor a "state actor" and implicating the Due Process Clause. See Nat'l Collegiate Athletic Ass'n v. Tarkanian, 488 U.S. 179, 195, 109 S.Ct. 454, 102 L.Ed.2d 469 (1988). The Due Process Clause limits the manner and extent to which a state legislature may delegate legislative authority to a private party acting as a state actor. See, e.g., Yick Wo v. Hopkins, 118 U.S. 356, 373-74, 6 S.Ct. 1064, 30 L.Ed. 220 (1886); West v. Atkins, 487 U.S. 42, 56, 108 S.Ct. 2250, 101 L.Ed.2d 40 (1988). Only if the state legislature imposes sufficient limitations is the exercise of authority by the private party constitutional. See, e.g., Seattle Title Trust Co. v. Roberge, 278 U.S. 116, 121-22, 49 S.Ct. 50, 73 L.Ed. 210 (1928) (concluding that the delegation of zoning power to individual landowners violated the due process clause because the ordinance allowed no opportunity for review and left the private parties free to withhold consent for selfish or arbitrary reasons based on will or caprice), but see Gilligan v. Pa. Horse Racing Comm'n, 492 Pa. 92, 422 A.2d 487, 489 (1980) (quoting Belovsky v. Redevelopment Authority, 357 Pa. 329, 54 A.2d 277, 284 (1947) (stating the legislative body "may establish primary standards and impose upon others the duty to carry out the declared legislative policy in accordance with the general provisions of the act.")).
Such delegated authority includes the ability to disseminate regulations so long as "(1) the basic policy choices [are] made by the Legislature; and (2) the `legislation [contains] adequate standards which will guide and restrain the exercise of the delegated administrative functions.'" Gilligan, 422 A.2d at 489 (quoting Chartiers Valley Joint School v. Cnty. Board of School Dirs., 418 Pa. 520, 211 A.2d 487, 493 (1965)).
WRA argues that nothing in the City Charter authorizes the Planning Commission to make zoning decisions. (Doc. #229 at 10). It argues that the CRO requires the Planning Commission to "second-guess" the zoning established by the City Council based on vague and undefined criteria. Id. at 12-13. The City argues the improper delegation claim fails because the POD standard was set by City Council and the ordinance at issue expresses only basic policy decisions and provides eight "Legislative Findings" that address the specific objectives of the overlay. (Doc. #228 at 36). (Doc. #223 at 15); Section 14-1638(1)(a)-(1)(h). Furthermore, the City argues that the ordinance provides standards because the Plan must "provide[] for development appropriate in scale, density, character and use for the surrounding community." Id.; Section 14-1638(12)(a).
WRA fails to supply evidence demonstrating that the Planning Commission was delegated impermissible power or that the statute is void of ascertainable standards against which a court may measure the Commission's exercise of discretion. The limitations on a legislative body's ability to delegate do not mean that each and every
The Equal Protection Clause of the Fourteenth Amendment provides that "[n]o state ... shall deny any person within its jurisdiction equal protection of the laws." U.S. Const. amend. XIV. "To bring a successful claim under 42 U.S.C. § 1983 for a denial of equal protection, plaintiffs must prove the existence of purposeful discrimination. To the extent Plaintiffs allege discrimination by Defendants solely by treating similarly situated individuals more favorably, they must demonstrate that they `received different treatment from that received by other individuals similarly situated.'" Keenan v. City of Phila., 983 F.2d 459, 465 (3d Cir. 1992) (citing Andrews v. City of Phila., 895 F.2d 1469, 1478 (3d Cir.1990)); and Cnty. Concrete, 442 F.3d at 167 (stating the test for a facial equal protection challenge to land-use regulations is the arbitrary differential treatment of similarly situated property owners).
Thus, the "first inquiry a court must make in an equal protection challenge to a zoning ordinance is to examine whether the complaining party is similarly situated" to other uses that are permitted. Congregation Kol Ami v. Abington Twp., 309 F.3d 120, 137 (3d Cir.2002). If the entities are similarly situated, then the City must justify its different treatment of the two under the rational basis test. Rogin v. Bensalem Twp., 616 F.2d 680, 689 (3d Cir.1980). Under rational basis, the burden is on the party challenging the validity of the ordinance to establish that the statute is unconstitutional. FCC v. Beach Communs., Inc., 508 U.S. 307, 314-15, 113 S.Ct. 2096, 124 L.Ed.2d 211 (1993). The party defending the constitutionality of the action need only demonstrate some legitimate justification that motivated the action. Id. at 315, 113 S.Ct. 2096.
WRA alleges that the CRO and POD regulations violate equal protection because the standards are impermissibly vague and indefinite and invite ad hoc regulation and impermissible discrimination.
"The doctrine of promissory estoppel allows a party, under certain circumstances, to enforce a promise even though that promise is not supported by consideration." Shoemaker v. Commonwealth Bank, 700 A.2d 1003, 1006 (Pa.Super.Ct.1997). In Pennsylvania, the doctrine of promissory estoppel involves three elements: (1) the promisor made a promise that he should have reasonably expected to induce action or forbearance on the part of the promisee; (2) the promisee actually took action or refrained from taking action in reliance on the promise; and (3) injustice can be avoided only by enforcing the promise. Jodek Charitable Trust, R.A. v. Vertical Net Inc., 412 F.Supp.2d 469, 478 (E.D.Pa.2006).
Under Pennsylvania law, plaintiff need not allege the exact, express "promise" in order to state a cause of action for promissory estoppel. See, e.g., Cornell Cos., Inc. v. Borough of New Morgan, 512 F.Supp.2d 238, 266 (E.D.Pa.2007); Straup v. Times Herald, 283 Pa.Super. 58, 423 A.2d 713, 720 (Pa.Super.1980) (describing promissory estoppel as "a flexible doctrine, to be applied ... as the equities between the parties preponderate"). However, a broad and vague implied promise is not enough to satisfy the first element. Ankerstjerne v. Schlumberger Ltd., 2004 WL 1068806, *4-5, 2004 U.S. Dist. LEXIS 9927, *14 (E.D.Pa.2004) (citing C & K Petroleum Prods., Inc. v. Equibank, 839 F.2d 188, 192 (3d Cir.1988)).
WRA claims that over a period of almost 20 years, the City encouraged and materially supported WRA's Project, by brokering the Zoning Covenant,
The City contends that its "mere encouragement" is not sufficient to support a promissory estoppel claim.
The Plaintiff has been unable to articulate a valid and enforceable promise.
Under Pennsylvania law, a claim of unjust enrichment must allege the following elements: (1) plaintiff conferred a benefit on the defendant; (2) the defendant appreciated the benefit; and (3) acceptance and retention by the defendant of the benefits, under the circumstances, would make it inequitable for the defendant to retain the benefit without paying for the value of the benefit. Com. ex rel. Pappert v. TAP Pharm. Prods., Inc., 885 A.2d 1127 (Pa.Commw.2005). See also Torchia v. Torchia, 346 Pa.Super. 229, 499 A.2d 581, 582 (1985) ("[T]o sustain a claim of unjust enrichment, a claimant must show that the party against whom recovery is sought either wrongfully secured or passively received a benefit that it would be unconscionable for her to retain."). However, Pittsburgh Baseball v. Stadium Auth., 157 Pa.Cmwlth. 478, 630 A.2d 505, 510 (Pa.Commw.Ct.1993) narrows the application of an unjust enrichment claim, holding that a party who bestows an indirect benefit on another is not entitled to a quasi-contract remedy.
WRA alleges that the City combined eleven and a half (11.5) acres of City-owned property with WRA's Site to establish the minimum fifteen (15) acres required for a KOZ, a status which the City would not otherwise have obtained. (Doc. #211 at ¶¶ 69-78). WRA alleges that it bore the expense of hiring a lobbyist, Steven Wojcik and Associates, without whom the KOZ status would not have been granted. (Doc. #239 at 34 ¶¶ 17-25). Specifically, WRA alleged that it paid the Wojcik firm "approximately one-hundred and fifty thousand dollars to achieve this result[,]" and the City benefitted from WRA's efforts, which resulted in the KOZ status. Id. at 34-35 ¶¶ 24-25, 1-5. There is an element of cynicism inherent in this argument. For sure, WRA hired the lobbyist and the lobbyist likely assisted the effort by advocating for the parties' joint request for KOZ status. But to say the hiring of the lobbyist secured the result totally diminishes the parties' integrity in the application process. The "my lobbyist created your result" position completely dismisses the Commonwealth of Pennsylvania's independent review of the application and the ultimate granting of the KOZ designation through the analysis of objective criteria, precedent and standards. Plaintiff's pompous pronouncement that it conferred a benefit on the City by obtaining the KOZ status ignores the City's cooperative effort, the Commonwealth's exercise of discretion, and the fact that WRA's portion of the property, which is substantial, is more valuable today than it was before it was designated for the KOZ.
The City is correct that the KOZ status was an indirect benefit bestowed upon the City by the Commonwealth and was not due to entirely to WRA's actions. (Doc. #223 at 29). Even if the City did receive a benefit from WRA, it would not be unjust because WRA also received a benefit from the transaction. Id. at 28. WRA has failed to produce evidence that it conferred a direct benefit upon the City. Much like the Pittsburgh Baseball case, WRA did not bestow the benefit of KOZ status on the City. The status was granted by the Commonwealth of Pennsylvania and, therefore,
For the reasons set forth in this memorandum, I will grant the City of Philadelphia's motion for summary judgment, any deny the plaintiff's motion.
An appropriate order follows.
AND NOW, this 4th day of November, 2011, upon careful consideration of the Defendant's Motion for Summary Judgment (Doc. #223) and the Plaintiff's Motion for Partial Summary Judgment (Doc. #224) and all responses thereto it is hereby ORDERED that:
1. The Defendant's Motion for Summary Judgment is GRANTED;
2. The Clerk of Court is directed to mark this case CLOSED.
Phila., Pa., The Philadelphia Code § 14-1638(12)(a) (2010).
Id. at 256.
Hoffman Estates v. Flipside, Hoffman Estates, 455 U.S. 489, 498-99, 102 S.Ct. 1186, 71 L.Ed.2d 362 (1982).
The Civic Vision identifies certain goals for Movement Systems, Parks and Open Space, and Land Development, such as increasing opportunities for public access to the riverfront, improving riverfront life and promoting water quality and extending Philadelphia's urban neighborhoods to the river's edge. Id. at ¶ 43 (citing the Civic Vision, pp. 72-74 (Exhibit K)). The Civic Vision also makes recommendations, such as ensuring public access to the Riverfront through zoning, conservation easements and acquisition of public spaces, improving the quality of development through the creation of both an interim zoning overlay and a long-term riverfront zoning classification, and ensuring that short term gain does not preclude achieving long term goals. Id. at ¶ 44 (citing the Civic Vision, pp. 30-31 (Exhibit K)).
Philadelphia Code, § 14-1638(1)(h).