Commonwealth Court Holds Failure To Raise Constitutional Issues in Initial Case Bars Litigant From Raising in Second Similar Case Under Res Judicata Doctrine

October 2010Newsletters In the Zone

Callowhill Center Assoc. Inc. v. Zoning Bd. of Adjustment, 2010 WL 3075744 (Pa. Cmwlth. Aug. 9, 2010)

In 1999, a landowner erected a 9,750-square-foot non-accessory wall wrap advertising sign on its commercial building without first acquiring a zoning permit. When the landowner finally requested a permit, it was rejected by the city, and the landowner then applied to the Board of Adjustment for a variance. The board granted the variance, but the trial court reversed the board’s decision on the ground the landowner failed to prove an unnecessary hardship. The Commonwealth Court confirmed, noting when the sign was erected the building was 70 to 80 percent occupied by commercial tenants and thus was being put to profitable use, and the loss of sign revenue did not render the building valueless. Alternatively, the landowner also challenged the constitutionality of the city’s zoning code as a prior restraint on commercial speech and as exclusionary zoning. The Commonwealth Court held those arguments were waived because they were never raised before the board.

The subject litigation began in 2005 when the landowner again applied for a zoning permit to erect a 9,750-square-foot non-accessory wall wrap advertising sign on its commercial building. The permit was denied, and the landowner appealed to the board arguing that (1) the code created an unreasonable hardship, (2) the code is unconstitutional because it is exclusionary and restricts freedom of expression, and (3) a variance will not have an adverse impact on the public. The board denied the variance, finding the Commonwealth Court’s decision in the 1999 case was res judicata and the constitutional challenge was without merit. The trial court upheld the board’s decision.

The Commonwealth Court first noted the landowner was requesting a variance for the same size and type of sign that was at issue in the 1999 case. Although the landowner provided evidence that in 2005 the building was only 60 to 65 percent occupied, as opposed to 70 to 80 percent occupied in 1999, the court determined the record did not demonstrate the existence of any substantial changes in the circumstances relating to the land itself and the building is now, as it was in 1999, occupied by commercial tenants and thus being put to profitable use. The court held the landowner’s entire challenge, including its constitutional arguments, was barred by the doctrine of res judicata. Despite the fact the merits of the constitutional challenge were never discussed in the 1999 case because that issue was deemed waived for failure to be raised at the board level, the court nonetheless held those issues could not be raised in the present litigation and were barred under the doctrine of res judicata because they could have beenraised in the 1999 litigation.

The lesson to be learned from this case is that all possible challenges must be raised at the first opportunity to avoid the situation in this case where a landowner was barred from raising issues in a later case that could have, and should have, been raised in the initial case.

For more information, please contact Kimberly A. Freimuth at 215.918.3627 or [email protected].