IN THE COMMONWEALTH COURT OF PENNSYLVANIA

Somera Road – 835 West Hamilton :

Street, LLC, :

Appellant :

: No. 568 C.D. 2019

v. :

: Argued: June 9, 2020

City of Allentown :

BEFORE: HONORABLE P. KEVIN BROBSON, Judge

HONORABLE PATRICIA A. McCULLOUGH, Judge

HONORABLE J. ANDREW CROMPTON, Judge

OPINION NOT REPORTED

MEMORANDUM OPINION 

BY JUDGE McCULLOUGH FILED: August 25, 2020

Somera Road – 835 West Hamilton Street, LLC (Appellant) appeals 

from the April 12, 2019 order of the Court of Common Pleas of Lehigh County (trial 

court) granting summary judgment in favor of the City of Allentown (City) on a

claim for a de facto taking. The City has filed a motion to dismiss and/or quash the 

appeal. For the reasons that follow, we dismiss the appeal.

Background

Plaza at 835 West Hamilton Street (Plaza) was the former owner of a 

multi-story commercial Class A office space building in the downtown area of 

Allentown, Lehigh County, Pennsylvania, commonly known as the “PPL Plaza” 
2

(Property or Building).1 On October 27, 2017, Plaza commenced this action in the 

trial court by filing a petition for the appointment of a board of viewers pursuant to 

section 502(c) of the Eminent Domain Code (Code),

2 26 Pa.C.S. §502(c). Plaza 

alleged that the City effectuated a de facto taking because it engaged in a course of 

conduct that caused Plaza to lose a major tenant and sustain a substantial impairment 

to the value of the Property. 

In an apt and able manner, the trial court set forth the factual and 

procedural history of this case as follows:

The [B]uilding in question was originally constructed in 

2005. [Plaza] was not the original builder, but purchased 

the [Property and] structure in November 2006 for $92 

million. At the time of acquisition, [Plaza] paid $13 million 

in cash, and financed the remaining balance of the purchase 

price through two loans. One loan was for $75 million, 

while the second loan was in the amount of $7 million. 

There was a balloon payment provision for any outstanding 

balance to be paid in full by December 1, 2016.

At the time of purchase, certain pre[]existing leases of 

office space within the building were already in place. The 

largest tenant in terms of square footage and total amount of 

rent paid was PPL Energy Plus Corporation (PPL), and its 

successor, Talen Energy Corporation (Talen). The original 

lease began on April 30, 2003, and ran until April 30, 2018. 

In December 2014, PPL unsuccessfully attempted to 

renegotiate the base rent with [Plaza]. PPL also offered to

purchase the building outright from [Plaza] in January 2015 

for $41 million, but [Plaza] rejected the offer. In June 2015, 

PPL spun off [and formed into the corporate entity,] Talen. 

Talen subsequently assumed the lease rights from PPL for 

 

1 As explained infra, Appellant later became the owner.

2

26 Pa.C.S. §§101-1106.
3

the portion of [the] [P]roperty which PPL rented, with a 

unilateral right to extend the lease to 2038.

In 2015, Talen and [Plaza] began discussions about an 

extension of Talen’s lease. As the negotiations proceeded, 

Talen was also being wooed to move out of [Plaza’s]

property to another location. These alternate sites included 

office space in Bethlehem, Pennsylvania and Phillipsburg, 

New Jersey. However, there was significant pressure to 

retain Talen as a tenant in Class A office space in 

Allentown, and particularly within a 127.5[-]acre 

designated area within Allentown, referred to as the 

Neighborhood Improvement Zone [(NIZ) Zone].

The NIZ [Zone] was created by legislation enacted in 2011 

for the purpose of energizing economic development in 

certain portions of downtown Allentown and along the 

riverfront abutting the Lehigh River. Although [the 

Allentown Neighborhood Improvement Zone Development

Authority (ANIZDA)] was created by the enactment of a 

municipal ordinance, ANIZDA itself is deemed a “public 

instrumentality of the Commonwealth.” [Section 6(a) of 

Economic Development Financing Law (Economic 

Development Law),

[3] 73 P.S. §376(a)]. As a 

Commonwealth instrumentality, ANIZDA is a separate and 

distinct agency from the [City].

According to the authorizing statute and city ordinance, 

ANIZDA was empowered by law to undertake activities, 

including issuance of loans, in order to facilitate and 

advance the development of real estate parcels in [the NIZ 

Zone, which is] a strictly configured area within the [City]. 

However, ANIZDA was not endowed with condemnation 

or eminent domain powers. [See 73 P.S. §376(b) 

(enumerated express grants of rights and powers); see also

the Neighborhood Assistance Act, located in Article XIXA, Sections 1901-A – 1909-A, of the Tax Reform Code of 

1971 (Tax Code), Act of March 4, 1971, P.L. 6, as 

amended, added by the Act of June 16, 1994, P.L. 279, 72 

P.S. §§8901-A – 8908-A, and the act commonly referred to 

 

3 Act of August 23, 1967, P.L. 251, as amended, 73 P.S. §§371-386.
4

as the NIZ Law, located in Article XIX-B, Sections 1901-B 

– 1909-B, of the Tax Code, added by the Act of July 9, 

2013, P.L. 270, 72 P.S. §§1901-B – 1909-B.] ANIZDA 

promulgated certain guidelines to establish the procedure 

and criteria by which the agency would evaluate loan 

applications for funds to support economic development 

projects within the confines of the NIZ [Law]. Among the 

criteria was a requirement that any project seeking 

ANIZDA-approved funds was limited to any new 

construction or renovation and improvements of existing 

structures within the NIZ. [Section 1904-B of the Tax 

Code, 72 P.S. §8904-B(a), (e)(1)4]. [Plaza’s] [P]roperty 

was constructed in 2005, well before enactment of the NIZ 

legislation, but the [P]roperty is set within the boundaries of 

the NIZ [Zone].

The innovative concept behind the NIZ [Law] was a 

provision that allowed for the segregation of state revenue 

generated by existing businesses and their employees within 

the specific confines of the NIZ [Zone]. Those state 

revenues, drawn from state income, sales, cigarette taxes, 

etc., were used to support the issuance of bonds to pay for 

the construction of the centerpiece of the economic revival 

of downtown Allentown, a sports and entertainment venue

known as the PPL Center. [See generally Allentown 

Neighborhood Improvement Zone Development Authority v. 

City of Allentown (C.C.P. Lehigh Nos. 2015-C-1488, 1489, 

1490, and 490, filed May 20, 2016); see also sections 1902-

B, 1903-B of the Tax Code, 72 P.S. §§8902-B (defining 

 

4 This provision states that following the designation of a NIZ Zone, an authority, such as 

ANIZDA, shall notify the State Treasurer of the designation, and the State Treasurer shall establish 

a special fund for the benefit of each authority to be known as the NIZ Fund. Section 1904-B of the 

Tax Code, 72 P.S. §8904-B(a). The money may be used by the authority “[f]or payment of debt 

service, directly or indirectly through a multitiered ownership structure or other structure authorized 

by [an] authority to facilitate financing mechanisms, on bonds or on refinancing loans used to repay 

bonds issued to finance or refinance . . . the improvement and development of all or any part of the 

neighborhood improvement zone; and . . . the construction of all or part of a facility or facility 

complex.” 72 P.S. §8904-B(e)(1)(i)(A)-(B). See also 73 P.S. §376(b)(14) (vesting an authority 

with the power “[t]o do all acts and things necessary or convenient for the promotion of its business 

and the general welfare of the authority, to carry out and exercise the purpose of and the powers 

granted by this act or any other acts”). 
5

“facility” and “facility complex,” in large part, as and/or 

with reference to an “a stadium, arena[,] or other structure 

owned or leased by a professional sports organization), 

8903-B (“The [] authority may designate a [NIZ Zone] of 

not greater than 130 acres in which a facility or facility 

complex may be constructed and may borrow funds for the 

purpose of improvement and development within the [NIZ

Zone] and construction of a facility or facility complex 

within the zone.”)]

To manage this economic revitalization, the legislation 

authorized the appointment of an oversight board known as 

[ANIZDA (ANIZDA Board)]. As stated above, the 

ANIZDA [B]oard was permitted by the NIZ [Law] to issue 

bonds to fund the construction of the arena. The funding 

needed to support the issuance of the bonds was predicated 

upon a dedication of state tax revenue from existing 

businesses within the NIZ [Zone], primarily from PPL

Energy Plus, and its successor, Talen Energy [(Talen)]. For 

example, Talen alone contributed $13.7 million per year in 

NIZ taxes, almost the entire amount necessary to pay the 

$15.3 million annual debt for the arena.

Without the state revenue specifically drawn from Talen 

and its employees, the funding necessary to support the 

bonds issued by ANIZDA to pay for the construction of the 

hockey arena could be endangered. As a result, Talen’s

consideration of whether [] to remain as a tenant of 

[Plaza’s] [P]roperty took on an added significance to the 

ANIZDA [B]oard and the Mayor of Allentown, Edward 

Pawlowski [(Mayor)], to ensure the viability and continued 

success of the economic revitalization of Allentown.

In addition, the [NIZ Law] authorized the use of any state 

taxes generated from new businesses which came into the 

NIZ [Zone] to finance the construction or renovation of 

existing structures for those same new businesses, including 

other Class A office space. These subsidized construction 

loans enabled owners of newly built or renovated properties 

within the NIZ [Zone] to offer square footage rental rates 

below prevailing market rates, and thereby created a 

competitive disadvantage for any existing Class A office 

space within or outside of the boundaries of the NIZ [Zone].
6

As the negotiations continued between Talen and [Plaza], 

the leadership of ANIZDA and [the] Mayor [] were in 

frequent contact with Talen’s CEO, Paul Farr, about 

retaining Talen as a tenant within the NIZ [Zone]. Talen’s 

continue[d] presence in the NIZ [Zone] took on crucial 

importance due to the reliance by the ANIZDA [B]oard 

upon the state revenues generated by Talen’s employees.

Despite substantial efforts by [Plaza] to retain Talen as a 

tenant, in August 2017, Talen gave notice in August 2017 

that it was not going to extend its lease of [Plaza’s

Building] past the expiration date in April 2018. However, 

even before Talen rejected an extension of its lease, [Plaza]

was unable to make its balloon mortgage payment in 

December 2016. As a result, the mortgagee Wells Fargo 

Bank, N.A. [(Lender)] initiated mortgage foreclosure 

proceedings. While [Plaza] has conjoined the two events as 

being factually intertwined, it is important to observe that 

[Plaza] was not able to pay the balloon payment in 

December 2016 even while Talen was a tenant of the 

subject premises. 

On December 6, 2017, the undersigned entered an order 

granting [Lender’s] motion for judgment on the pleadings in 

the mortgage foreclosure action, and set a date for a hearing 

on damages.

[Plaza] has not proposed to construct a new facility, or 

renovate or improve the current facility. As a result, [Plaza] 

is statutorily precluded from applying for and obtaining any 

of the taxpayer-subsidized loans from ANIZDA. Ironically, 

[Plaza’s] [P]roperty was the beneficiary under previous 

legislation as being located within a “Keystone Opportunity 

Zone” that provided for an abatement of property taxes for a 

limited time period as an inducement for real estate 

development in certain urban areas.

[Plaza] contends the subsidized construction loans that are

available through the ANIZDA approval process have in 

turn depressed competing square foot rental rates in those

newly constructed Class A office space facilities. Existing 

commercial rental locations which predated the enactment 
7

of the NIZ, or which carry too high a debt load to enable the 

property owners to lower their rental rate, cannot compete 

against the subsidized square foot rental rates.

[Plaza] argues the consequential erosion of its competitive 

position amounted to an unlawful de facto taking or 

condemnation by the City of Allentown . . . because of the 

participation by [it] in the authorization or implementation 

of the NIZ-related tax collection. [Plaza] alleges that the

City [] engaged in a de facto taking of its property by the 

failure of [the] former Mayor [] and other city officials to 

take steps necessary to prevent Talen from vacating

[Plaza’s] premises, and by encouraging Talen to relocate to 

another property in the NIZ [Zone] which was able to offer 

substantially less expensive rental rates due to NIZ [Law]

subsidies.

[Plaza] filed its Petition for the Appointment of a Board of 

View[ers] on October 17, 2017. [Plaza] claims a Board of 

View[ers] needs to be appointed to determine the financial 

value of [Plaza’s] property. This figure would then be used 

to calculate the amount of damages owed by [the City] to 

[Plaza]. [The City] filed Preliminary Objections on 

December 22, 2017. On March 22, 2018, the [trial court]

filed an Order with an accompanying Memorandum

Opinion overruling the [City’s] preliminary objections and 

directing the parties to engage in discovery. The [trial 

court] set a hearing date for September of 2018, but due to 

the filing of several discovery-related motions, the hearing 

date was postponed . . . . 

On January 31, 2019, [the City] filed the instant Motion for 

Summary Judgment. [Plaza] filed it response on February 

20, 2019, and the [trial court] heard oral argument on the 

motion on March 12, 2019, at which time [it] took the 

matter under advisement. 

(Trial court op. at 3-8) (italicized emphasis in original, bold emphasis added) 

(internal citations omitted).

By opinion and order dated April 12, 2019, the trial court granted the 

City’s motion for summary judgment and dismissed Plaza’s petition for the 
8

appointment of a board of viewers. In its opinion, the trial court emphasized that it 

granted Plaza wide latitude to engage in discovery and required the City to produce 

numerous documents and email correspondence between the Mayor, the Chairman of 

the ANIZDA Board, the City’s Director of the Office of Community and Economic 

Development (Director of Economic Development), and the Chief Executive Officer 

of Talen. The trial court then surveyed the evidence and explained that Plaza failed 

to establish that the City, or any of its employees, including the Mayor, or the 

ANIZDA Board, took action that was intended to harm Plaza.

5

 In addition, the trial 

 

5 For instance, the trial court noted that “[t]he emails and deposition testimony amply 

illustrate the efforts undertaken” by the Mayor, the Director of Economic Development, and the 

Chairman of the ANIZDA Board “to find an attractive enough incentive package to convince []

Talen to keep its corporate headquarters and the hundreds of employees who worked for Talen at 

[Appellant’s] property, or alternatively, within the NIZ [Zone].” (Trial court op. at 10.) The trial 

court further explained that

[t]he predominant concern for [these] individuals was not so much the 

continued presence of Talen at [Appellant’s] property, but to retain 

Talen at any location in the NIZ [Zone]. This endeavor was the focus 

of these individuals not because they wished to harm [Appellant], but 

because it was critical to the financial success of the NIZ [Law and 

Zone] to retain Talen, its hundreds of employees, and the 

commensurate millions of dollars in state revenue flowing to the

ANIZDA to support the bonds that financed the construction of the 

hockey arena . . . . To put it bluntly, ANIZDA could survive without 

[Appellant’s] property being rented, but it could not easily absorb the 

loss of Talen and its associated stream of tax dollars.

Despite the fairly unbridled expanse of discovery permitted by the 

Court, [Appellant] has been unable to present any evidence that the 

Mayor intervened to persuade Talen to vacate [Appellant’s] premises. 

At most, the discovery materials reveal that the Mayor did not 

successfully cajole legislators to enact separate alternative funding so 

that [Appellant] could also [be] offer[ed] subsidized commercial 

rental rates, and the Mayor did not persuade the ANIZDA [B]oard to

provide financial assistance to [Appellant].

(Footnote continued on next page...)
9

court noted that ANIZDA and its Board were separate and distinct governmental 

entities from the City; the ANIZDA Board had control over the NIZ funds, but was 

not named as a party in this suit; and, importantly, the ANIZDA Board does not have 

eminent domain powers. The trial court found that Plaza failed to come forward with 

sufficient evidence to establish that the City, the Mayor, or any of its employees 

committed conduct that could be deemed as a causal or contributing factor in Plaza’s 

loss of Talen as a tenant. Finally, the trial court pointed out that, before Talen 

decided not to sign a lease extension, Plaza was not financially able to fulfill its 

mortgage obligations and Lender instituted mortgage foreclosure proceedings. 

Therefore, the trial court granted summary judgment in favor of the City and 

dismissed Plaza’s petition with prejudice.

Meanwhile, as noted above, while the eminent domain proceedings were 

pending before the trial court, on August 7, 2018, the trial court entered an in rem 

judgment in the foreclosure action against Plaza and in favor of Lender in the amount 

of $69,485,302.36. Pursuant to the terms of the mortgage and security agreement 

between Plaza and Lender, Plaza, as result of the judgment in foreclosure entered 

against it, transferred and/or assigned to Lender all of the causes of action that Plaza 

had with respect to the Property. Arguably, the transfer and/or assignment included 

Plaza’s de facto claim in the eminent domain proceedings. Thereafter, on November 

15, 2018, Lender assigned and/or transferred the mortgage judgment to Appellant, 

along with all the corresponding rights in the mortgage and security agreement. After 

the trial court entered summary judgment against Plaza on April 12, 2019, on April 

 

(continued...)

(Trial court op. at 10-11.) 
10

26, 2019, a sheriff’s sale was held on the Property. At the sheriff’s sale, Appellant 

purchased the Property for approximately $16 million, and the sheriff issued a new 

deed within 60 days. (Reproduced Record (R.R.) at 2432a-2435a.) 

On May 8, 2018, Appellant filed a “Praecipe for Substitution of 

Successor Petitioner” with the prothonotary of the trial court. Appellant asserted that 

it was the present holder of the mortgage foreclosure judgment and mortgage and 

security agreement and, also, the owner of the Property. Therefore, Appellant 

contended that it was “the successor party to Plaza,” “possesse[d] the right to pursue 

Plaza’s claims in the instant action,” and was and is “the current party at interest in 

this [e]minent [d]omain [a]ction.” (R.R. at 2434a.) 

On May 9, 2019, Appellant filed a notice of appeal to this Court. On 

October 9, 2019, the City filed an application to quash and/or dismiss, contending 

that Appellant failed to establish that it was a “successor” for purposes of Pa.R.C.P. 

No. 2352(a), and that Appellant, as a purchaser of the Property after an alleged de 

facto taking had occurred, does not have standing to appeal the order entering

summary judgment against Plaza. Appellant filed an answer on October 23, 2019, 

emphasizing that under the law, it has special rights as an assignee of a cause of 

action pursuant to the mortgage documents and mortgage judgment. By per curiam 

order dated November 12, 2019, this Court deferred ruling on the City’s application 

to quash and/or dismiss and ordered that it be listed with the merits of the appeal. 

Discussion

On appeal, Appellant contends that the trial court erred in granting 

summary judgment in favor of the City. However, before we can delve into the 
11

merits of this contention, we must initially address the City’s motion to dismiss for 

lack of standing. 

Under Pa.R.C.P. No. 2352(a), titled “Substitution of Successor,” a 

“successor may become a party to a pending action by filing of record a statement of 

the material facts on which the right to substitution is based.” Id. In turn, Pa.R.C.P. 

No. 2351 states that a “successor” is “anyone who by operation of law, election or 

appointment has succeeded to the interest or office of a party to an action.” Id. 

However, under Pennsylvania law, Appellant “cannot claim damages for 

a de facto taking which, if it happened at all, occurred prior to the time it became the 

owner of the property.” Snap-Tite, Inc. v. Millcreek Township, 811 A.2d 1101, 1105 

(Pa. Cmwlth. 2002); see also Fidelity-Philadelphia Trust Co. v. Kraus, 190 A. 874, 

876 (Pa. 1937) (stating that “[t]he right to the damages resulting from the 

[condemnation] did not pass to [the purchaser] by the sale; the right is personal and 

does not run with the land”). Further, Appellant cannot claim any right to maintain 

suit as a mortgagee or judgment creditor. See 26 Pa.C.S. §103 (defining 

“condemnee” as “[t]he owner of a property interest taken, injured or destroyed. The 

term does not include a mortgagee, judgment creditor or other lienholder.”). 

Relatedly, any assignment to Appellant of Lender’s purported right to recover 

damages in the eminent domain proceedings, as part of the judgment in the mortgage 

foreclosure action, was ineffectual as a matter of law, by virtue of the fact that the 

Property had been purchased at a sheriff’s sale. See Warner’s Estate, 24 Pa. D. & C. 

177, 182 (1935) (“[I]f a lienholder . . . is entitled to recover the damages paid by the 

condemnor to the owner he must act while the relationship of lienholder and owner 

still exists. If, without so acting, he forecloses his mortgage and takes title to the 

land, he loses all right to damages because the mortgage is extinguished” (citing Irons 
12

v. Pittsburgh, 64 Pa. Super. 126, 130-31 (1916));6cf. Mellon Bank, N.A. v. Crystian 

(In re Crystian), 197 B.R. 803, 805 (Bankr. W.D. Pa. 1996) (concluding that where 

“[t]he condemnation proceeds [were] the subject of a covenant and [were] assigned to 

the [b]ank,” and “[i]n Pennsylvania, upon condemnation, a lien is divested from the 

land but attaches by operation of law to the [proceeds],” “the assignment of the 

proceeds in the mortgage covenant does not constitute additional security” to “the 

lien of the mortgage”). Therefore, for purposes of the Rules of Civil Procedure, 

Appellant, “by operation of law,” cannot be deemed a “successor” to Plaza, Pa.R.C.P. 

No. 2351, and lacks standing to pursue this appeal. 

Accordingly, we grant the City’s motion to quash and dismiss the appeal 

because Appellant does not possess standing to pursue it. 

Assuming, arguendo, that Appellant had standing to maintain this 

appeal, we would conclude that its assertions of error lack merit. Appellant contends 

that the trial court erred in granting summary judgment in favor of the City because 

there are genuine issues of material fact regarding the role that the Mayor, the 

Director of Economic Development, and the Chairman of the ANIZDA Board had 

played with respect to Talen’s relocation.7 Appellant argues that the evidence it 

 

6

In Irons, the Superior Court determined that while a mortgagee creditor has standing to 

intervene and claim condemnation damages to the extent necessary to satisfy the lien, “[w]hen the 

property was sold at judicial sale, the . . . mortgage was extinguished” and, therefore, “the land 

pledged for the debt was reduced to possession by the creditor.” 64 Pa. Super. at 130. 

Consequently, the former mortgagee “was no longer a lien creditor” and it could not recover 

damages in the commendation proceedings because it could only do so “at a time when the relation 

of owner and lien creditor exist[ed].” Id. at 130-31.

7

“Preliminary objections are the exclusive method under the Code of raising objections to a 

petition for the appointment of a board of viewers alleging a de facto taking.” Genter v. Blair 

County Convention and Sports Facilities Authority, 805 A.2d 51, 55 n.6 (Pa. Cmwlth. 2002). 

Although the Code authorizes a court of common pleas to permit the parties to engage in discovery, 

(Footnote continued on next page...)
13

garnered from discovery is sufficient to establish that these individuals engaged in “a 

concerted effort . . . to develop a special mechanism to enable [PPL] to vacate the 

Property and relocate to a new, to-be-built property within the NIZ [Zone] and 

receive NIZ benefits.” (Appellant’s Br. at 41.) 

We disagree. Viewing the record evidence in the light most favorable to 

Appellant, and resolving all conflicts in the evidence in its favor, the evidence is

nonetheless insufficient to state a viable de facto taking claim as a matter of law. As 

presented, Appellant’s claim does not fit within the basic rubric that is designed for a 

de facto taking under the Code, and it is simply outside the legal scope of the 

doctrine. 

In Pennsylvania, the theory of eminent domain has constitutional 

underpinnings in the concept of just compensation for a governmental taking, and our 

General Assembly has enacted the Code to provide a substantive right and procedure 

to accomplish that end. See Pittsburgh Railways Co. v. Port of Allegheny County 

Authority, 202 A.2d 816, 821 (Pa. 1964). Section 502(c) of the Code vests a 

landowner with a right to assert what is commonly known as a de facto claim or 

taking. By its very nature, this type of claim involves specified property that has not 

been formally taken by a governmental entity through the actual exercise of the 

 

(continued...)

26 Pa.C.S. §306(f)(2), unlike civil actions governed by the Rules of Civil Procedure, the taking of 

discovery does not convert the preliminary objections into a summary judgment motion. The end 

result is that the standard of review for summary judgment motions, particularly the law pertaining 

to the existence of a genuine issue of material fact, is inapplicable in this case. Unlike its role in 

resolving summary judgment motions, a court of common pleas, in ruling on preliminary objections 

in a case under the Code, is charged with resolving evidentiary conflicts. In re Condemnation by 

Commonwealth, Department of Transportation, 827 A.2d 544, 547 n.4 (Pa. Cmwlth. 2003). In any 

event, there has been no allegation that the trial court erred in utilizing the summary judgment 

procedure to dispose of this case.
14

power of eminent domain, and it “is applicable only where a condemnor is found by 

the court to have taken property without the filing of a declaration of taking.” 

Department of Transportation v. Schodde, 512 A.2d 101, 102 n.1 (Pa. Cmwlth. 

1986). 

Generally, the factual and legal matrix for a de facto claim takes one of 

two forms. Where, as here, a governmental entity does not announce a plan or its 

intention to institute formal condemnation proceedings to take a specified portion of 

land or area, see, e.g., Lehigh-Northampton Airport Authority v. WBF Associates, LP, 

728 A.2d 981, 985-89 (Pa. Cmwlth. 1999) (discussing cases),

8

a landowner can assert 

a de facto claim by establishing that the consequential or collateral effects from a 

formal condemnation proceeding have resulted in a taking of his or her property. See,

e.g., Wolf v. Department of Highways, 220 A.2d 868, 871 (Pa. 1966).9 

 

8

In Lehigh-Northampton Airport Authority, this Court described the test for such a claim a 

follows: 

Where a property is designated for formal condemnation pursuant to a 

planned, prospective public improvement, adverse interim 

consequences caused to the property by the prospect of condemnation 

will not constitute a de facto taking unless those interim consequences 

are that the owner is deprived of the use and enjoyment of the 

property, or is subjected to the loss of the property before formal 

condemnation can provide compensation. If there has been such an 

interim deprivation of use, or exposure to loss, then the principle of de 

facto taking becomes applicable to accelerate the time when the 

governmental authority must make compensation. 

728 A.2d at 988 (internal citation omitted). See also Visco v. Department of Transportation, 498 

A.2d 984, 986-87 (Pa. Cmwlth. 1985) (discussing a case where “plans were recorded, with notices 

of intention to condemn being sent to some property owners” and “the property involved was in the 

line of taking”).

9 Wolf provides an example of this type of claim, namely where the Department of 

Transportation condemns land to build roads or related infrastructure and a nearby landowner 

(Footnote continued on next page...)
15

In this context, a landowner such as Appellant must demonstrate, at a 

minimum, three separate criteria. “[O]ne of the requisites of a de facto taking is that 

the condemnor must be an entity clothed with the power of eminent domain.” In re 

Condemnation by Commonwealth of Pennsylvania, Department of Environmental 

Resources, 497 A.2d 284, 286 (Pa. Cmwlth. 1985). The second is that the “de facto 

taking must result from a governmental body’s actual exercise of the power of 

eminent domain.” Darlington v. County of Chester, 607 A.2d 315, 320 (Pa. Cmwlth. 

1992). And the third is that “the damages sustained by the condemnee[—i.e., the 

landowner—]must be an immediate, necessary[,] and unavoidable consequence of 

such exercise.” Riedel v. County of Allegheny, 633 A.2d 1325, 1328 (Pa. Cmwlth. 

1993). In other words, in its condensed formulation, “a de facto taking requires that 

the injury complained of [be] a direct result of intentional action by an entity 

incidental to its exercise of its eminent domain power.” In re Mountaintop Area Joint 

Sanitary Authority, 166 A.3d 553, 562 (Pa. Cmwlth. 2017) (emphasis added). 

Here, the operative facts supporting Appellant’s claim that a de facto 

taking had occurred stem from the ANIZDA Board’s conduct in issuing bonds to 

fund a hockey facility in the NIZ Zone. However, as mentioned above, the ANIZDA 

Board does not possess the statutory power to condemn. The ANIZDA Board is also 

an instrumentality of the Commonwealth. As such, it is a governmental entity that is 

 

(continued...)

sustains injury to his/her property interests: “Where land is taken or purchased for highways, the 

abutting owner retains, as an incident to ownership of the remainder of his land, the right of access, 

or of ingress and egress. This right cannot be taken from him unless compensation is made therefor 

under the law.” Wolf, 220 A.2d at 871 (internal citation omitted). However, in Wolf, the alleged 

harm to the landowner’s right of ingress was “too remote” and “entirely unrelated” to the “property 

which was actually taken by the Commonwealth.” Id. at 873. 
16

separate and distinct from the City. Therefore, because the General Assembly has not 

granted the ANIZDA Board eminent domain authority, the activities of the ANIZDA 

Board cannot serve as a basis for a de facto claim. See Rowland v. Department of 

General Services, 820 A.2d 896, 899 (Pa. Cmwlth. 2003) (“[T]here is no dispute 

between the parties that neither the State Armory Board nor [the Department of 

Military and Veterans Affairs (DMVA)] is cloaked with the power of eminent 

domain . . . . Consequently, any allegation by [the landowner] in his brief that either 

the State Armory Board or DMVA effected a de facto taking of his property 

necessarily fails.” (internal citations omitted)).

Moreover, Appellant’s “de facto taking must result from [the] actual 

exercise of the power of eminent domain.” Darlington, 607 A.2d at 320. Even if the 

Mayor or the Director of Economic Development were clothed with the power to 

condemn, which is highly questionable, that authority was not used in any manner. A

fortiori, to the extent Appellant had suffered harm to the Property, it was not related 

to or incidental to an actual or formal condemnation by the Mayor or the Director of 

Economic Development. Cf. In re Mountaintop Area Joint Sanitary Authority, 166 

A.3d at 562 (explaining that a landowner did not state a claim for a de facto taking 

where “the losses suffered by the [landowner] were merely the unintended 

consequence” of the governmental authority’s condemnation activities and were “not

. . . related to or incidental to [the authority’s] condemnation powers”). Therefore, 

Appellant cannot assert that the activities of Mayor or the Director of Economic 

Development, in and of themselves, resulted in a de facto taking. 

To overcome these hurdles, Appellant seemingly attempts to 

intermingle, both factually and legally, the conduct of the ANIZDA Board with the 

agents of the City, the Mayor and the Director of Economic Development. 
17

Apparently, Appellant presupposes that the alleged condemnation power of the 

Mayor and the Director of Economic Development can be imported, imputed, or

otherwise transferred to the ANIZDA Board. But only the General Assembly can 

grant a governmental entity the authority to condemn, and it has not done so with the 

ANIZDA Board. See Pittsburgh Railways Co., 202 A.2d at 821 (“The legislature can 

grant the right to take private property for public use [and] may prescribe the kind 

and character of the security to be given and the manner in which it shall be given.”).

In short, Appellant’s claim is based on the implementation of legislation 

that is economic in nature and alleges that the above-mentioned individuals and/or 

entities conspired to place it at an economic disadvantage in the marketplace, which 

ultimately resulted in the loss of a tenant. At its core, the gist of the action underlying 

Appellant’s claim sounds as a “business tort” or a form of unfair competition rather 

than a governmental taking. While Appellant argues that it has enough evidence to 

prove arbitrary and calculated action on the part of the ANIZDA Board, the Mayor, 

and the Director of Economic Development, and its theory may suffice for purposes 

of some other cause of action, it is simply not one that fits within—or is cognizable 

under—the Code. 

Perceiving no reason to gild the lily, we conclude that the trial court did 

not err in granting summary judgment in favor of the City. Therefore, even if this 

Court did not dismiss Appellant’s appeal for lack of standing, we would affirm the 

trial court’s order on the merits. 

Accordingly, for the reasons stated above, we grant the City’s motion

and dismiss the appeal.

________________________________

PATRICIA A. McCULLOUGH, Judge
IN THE COMMONWEALTH COURT OF PENNSYLVANIA

Somera Road – 835 West Hamilton :

Street, LLC, :

Appellant :

: No. 568 C.D. 2019

v. :

:

City of Allentown :

ORDER

AND NOW, this 25th day of August, 2020, the motion to dismiss filed 

by the City of Allentown is granted and the appeal filed by Somera Road – 835 

West Hamilton Street, LLC, from the April 12, 2019 order of the Court of 

Common Pleas of Lehigh County is hereby dismissed.

________________________________

PATRICIA A. McCULLOUGH, Judge