Act 135 Conservator Appointment for Vacant Property Upheld by Superior Court

In Philadelphia, recently, there has been a push in City Council to limit the ability for non-profit organizations and individuals to take over derelict properties under Pennsylvania’s Abandoned and Blighted Property Conservatorship Act, 68 P.S. § 1101 et seq., also known as Act 135. 

Act 135 was enacted in Pennsylvania as a way to eliminate blighted properties from neighborhoods by allowing interested parties to file a private cause of action against absentee property owners.  Under Act 135, if a conservator is appointed by the trial court, they can bring a property up to applicable building codes and, after doing so, they will not only be repaid the cost for doing but they will also earn a commission for their time and energy which could even result in the forced sale of the property.  

In a recent opinion written by Judge Anne E. Lazarus, the Superior Court of Pennsylvania in Oceanview Property Management & Recovery Services, LLC v. Baker, 319 A.3d 508 (Pa. Super. Ct. 2024), held that the trial court did not err in the appointment of a conservator different from the one preferred by the plaintiff which initiated the Act 135 in the first place.  

In Oceanview, a property situated in Pittsburgh, Pennsylvania was still in the name of its deceased owner and the property was believed to have been vacant since at least 2016, the opinion said.  

In 2021, Oceanview Property Management & Recovery Services, LLC initiated an Act 135 action in the Allegheny Court of Common Pleas by way of petition for appointment as conservator over the allegedly blighted and abandoned property, the opinion said.  

In the petition, Oceanview requested that it be appointed as conservator under Act 135 to prevent further deterioration of the property and to permit it to begin rehabilitating the property, the opinion said.  

According to the opinion, shortly thereafter, Bloomfield Development Corporation filed a petition to intervene in the pending Act 135 action, which the trial court granted.  

Bloomfield also filed its own petition, proposing that the City of Bridges, a nonprofit corporation, be appointed as conservator of the property, the opinion said.  

The trial court in Oceanview then consolidated the petitions and ordered Oceanview and the City of Bridges to file proposed findings of fact and conclusions of law, briefs in support of their legal arguments, and proposed court orders, the opinion said.  

The trial court also permitted Oceanview and the City of Bridges to file responsive briefs.  

Subsequently, the trial court in Oceanview ruled that the City of Bridges should be appointed conservator of the property, the opinion said.  

The trial court in Oceanview found that Act 135 requires courts in Pennsylvania to give preferential treatment to nonprofit organizations, such as the City of Bridges.  

According to the opinion, the trial court in Oceanview also observed that the City of Bridges had experience as a conservator in Pittsburgh and that its preliminary plan for the abatement of the property was more developed than the one proposed by Oceanview.  

Additionally, the trial court in Oceanview concluded that the City of Bridges’ plan for the abatement of the property would preserve access to affordable housing in the community.  

Per the opinion, Oceanview filed a post-trial motion arguing that that the trial court erred in Oceanview when it found that Act 135 gives preference for the appointment of nonprofit organizations, that the City of Bridges could serve as conservator, and that affordable housing as part of the plan for abatement of the property was a valid consideration. 

After its post-trial motion was denied by the trial court, Oceanview filed an appeal of the trial court’s ruling to the Superior Court.  

On appeal, Oceanview raised similar issues as it did in its post-trial motion.  

In its first argument, Oceanview posited that the trial court misinterpreted language in Act 135 which set forth that a court “may appoint a nonprofit corporation or entity.”  

In response to that argument, the Superior Court noted that Oceanview did not provide any evidence that the trial court “misconstrued or misapplied the law.”  Rather, the Superior Court held that the trial court correctly interpreted Act 135 as requiring it to give greater weight to nonprofit organizations, such as the City of Bridges, over individuals.  Furthermore, the Superior Court observed that Oceanview did not submit any facts or legal arguments to suggest that the City of Bridges was unqualified to serve as a conservator.  

In its second argument, Oceanview contended that the trial court committed an error of law because the City of Bridges’ plan for abatement of the property did not maximize its full potential dollar value.  

In support of this argument, the opinion said, Oceanview pointed out that the City of Bridges would retain ownership of the land containing the residential structure and that it would only renovate the exterior of the structure on property before petitioning the trial court for permission to sell it.  

The Superior Court stated that Oceanview made the “bald statement” that “when a property is remediated and rehabilitated, the value of the property can then be maximized, through a court sale.”  According to the opinion, Oceanview did not provide any facts or law in support of this contention.  

Upon review of Act 135, the Superior Court found that the statute does not mention property value but, rather, merely explains how the proceeds from the sale of a property should be distributed.  The Superior Court emphasized that the trial court correctly recognized this as well when it stated that Act 135 “does not require a conservator to maximize the value of the subject property.”   

In its third and final argument, Oceanview claimed that the trial court erred when it found that one purpose of Act 135 is to supply affordable housing.  However, the Superior Court observed that Oceanview did not adequately explain or support its argument that the trial court improperly added an affordable housing requirement to Act 135, and that Oceanview should be barred from relief on that basis.  

Irrespective of this observation, the Superior Court went on to say that, even if Oceanview had not waived this argument, Oceanview would still not be entitled to relief, as, after two days of testimony and reviewing written arguments from Oceanview and Bloomfield, while the trial court found that affordable housing was a positive element of the City of Bridges’ conservatorship plan, the trial court did not rule that creation of affordable housing was a requirement under Act 135.  Instead, the Superior Court reiterated that the trial court merely stated that affordability of the property after the property abatement is one factor a court may consider when selecting between competing options for conservators.   

In the end, the Superior Court upheld the trial court’s ruling to award the conservatorship to the City of Bridges as being soundly within its discretion and supported by the record. 

Alan Nochumson is the principal of Nochumson P.C., a legal services firm with a focus on real estate, land use and zoning, litigation, and business counseling for the people of Pennsylvania and New Jersey. Nochumson is a frequent author and lecturer on issues commonly confronting businesses, individuals and professionals. You can reach him at 215-600-2851 or alan.nochumson@nochumson.com.

Alex Hamilton is an associate attorney at the firm. You can reach him at 215-399-1346 or alex.hamilton@nochumson.com.