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An outgoing Board of Supervisors may enter into a settlement agreement to resolve a land use appeal after election of new Board members but prior to the expiration of the outgoing Board’s term, and such agreement cannot be collaterally attacked by the new Board absent extraordinary circumstances.
T.H. Properties, L.P. v. Upper Salford Township Board of Supervisors, 970 A.2d 495 (Pa. Commw. 2009).
This action concerns a comprehensive zoning agreement between a developer and the Upper Salford Township Board of Supervisors for a residential development and golf course on a 312-acre parcel. The Board initially denied the application for subdivision plan approval in June, 2005, and the developer appealed that denial to the Common Pleas Court. In November, 2005, the Board authorized its solicitor and one Board Member to engage in settlement negotiations with the developer, and on December 10, 2007, the Township and Developer entered into a settlement agreement approved by the Court. Prior to execution of the settlement agreement, one of the supervisors was defeated in public elections. The agreement was approved before the new supervisor – who opposed the development – took office. The Township rescinded the authorization for settlement negotiations when the new supervisor took office and hired special counsel to void the agreement. The new Board appealed to the trial Court asserting that the settlement agreement could not bind the new Board, the approval of the agreement was void because one of the Supervisors had an undisclosed conflict of interest and the Trial Court was without ability to approve the agreement because the record was never filed with the Court. The Common Pleas Court upheld its approval of the settlement agreement, and the new Board appealed.
On appeal, the Commonwealth Court rejected the challenge to the settlement agreement by the new Board of Supervisors. The Court recognized that under Pennsylvania Supreme Court precedent, a newly-elected governing body should be able to act in the public’s interest without being bound by agreements of a prior board, and agreements made after an election but before new board members took office are of particular concern. The Court, however, reviewed the settlement agreement which outlined a comprehensive settlement, including significant benefits to the Township. It further noted that under the Municipalities Planning Code, any resident – including the new supervisor – could have intervened in the land use appeal. No one sought to intervene, but the new Board is attempting to collaterally attack the settlement. The Court found that the decisions invalidating long-term contracts are distinguishable from court-approved settlements. Specifically, the action of the old Board to approve the agreement is not a governmental function of the Board, but settlement of a land use appeal. Under the prior decision in Summit Township Taxpayers Association v. Summit Township Board of Supervisors, 411 A.2d 1263 (Pa. Commw. 1980), a collateral attack on a settlement agreement will not be upheld unless there are extraordinary circumstances. The Court found that based on the thorough, extensive settlement negotiations and agreement and failure of the new supervisor or others to intervene in the land use appeal and object to the settlement agreement, there were no extraordinary circumstances to challenge the settlement agreement through separate action.
Opinion Date: February 11, 2009
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