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Gaab v. Borough of Sewickley
Citations: 692 A.2d 643; 1997 Pa. Commw. LEXIS 183; 1997 WL 177116Docket: No. 2463 C.D. 1996
Court: Commonwealth Court of Pennsylvania; April 15, 1997; Pennsylvania; State Appellate Court
Richard Terrence Gaab and others (Appellants) appeal a summary judgment order from the Court of Common Pleas of Allegheny County, which favored the Borough of Sewickley and associated parties (Appellees), dismissing their complaint regarding a lease agreement for a communications tower. The Borough owns Waterworks Park, primarily undeveloped land except for facilities maintained by the Sewickley Water Authority. In 1995, Crown Communications proposed to construct a communications tower on part of the park, which culminated in a lease agreement on September 18, 1996, allowing Crown to build a 250-foot tower and an equipment building. The lease, valid for 25 years with renewal options, required Crown to provide various communication services to the Borough at no cost and to pay an annual rent starting at $2,400, increasing by 3% annually. Appellants sought to invalidate the agreement, claiming it violated the Borough Code's public bidding requirements. They argued the agreement constituted a de facto sale of real estate under Section 1201(4), which mandates public bidding for real estate transactions over $1,500, and also a contract of purchase over $10,000 under Section 1402(a). The trial court dismissed the complaint, ruling these sections inapplicable. Appellants contend this was an error, asserting the agreement's long-term nature and exclusivity to Crown necessitate a classification as a sale rather than a lease. Section 1201(4) specifies that borough-owned real estate cannot be sold for more than $1,500 without competitive bidding. Section 1201(4) of the Code is applicable solely to real estate sales. The trial court determined that the Agreement in question was a lease, thus rendering Section 1201(4) irrelevant. Black's Law Dictionary defines a sale as the "transfer of title to land by deed" and a lease as an "agreement" where the owner relinquishes possession for a specified term, retaining the right to reclaim the property afterward. The trial court supported its lease classification by noting several stipulations in the Agreement, including: a defined term for Crown's property use, restrictions on the purpose of use (erecting a communications tower), a requirement for construction diligence, prohibitions against interference with existing operations, obligations for providing maintenance and services, and an annual rent of $2,400 with a 3% increase per year. Additionally, failure to meet these conditions could lead the Borough to terminate the Agreement and reclaim interests in improvements. Regarding Section 1402(a) of the Code, which mandates that contracts over $10,000 must be awarded to the lowest responsible bidder, the trial court ruled it inapplicable. This section pertains only to public fund expenditures for contracts or purchases. In this case, no public funds were involved, and applying the bidding requirement would be illogical, as it could force the Borough to accept the least beneficial offer. Consequently, the trial court's findings on both sections were upheld, affirming its decision without legal error or abuse of discretion. The order from the Court of Common Pleas of Allegheny County is affirmed. The scope of review for the trial court’s summary judgment is limited to assessing legal errors or discretion abuses, and summary judgment is appropriate when no genuine material fact issues exist.