S.L. Holtzapple v. CJD Group, LLC and York County TCB ( 2018 )

IN THE COMMONWEALTH COURT OF PENNSYLVANIA
Steven L. Holtzapple, :
:
Appellant :
: No. 1114 C.D. 2017
v. : Argued: September 14, 2018
:
CJD Group, LLC and York County :
Tax Claim Bureau :
BEFORE: HONORABLE RENÉE COHN JUBELIRER, Judge
HONORABLE CHRISTINE FIZZANO CANNON, Judge
HONORABLE JAMES GARDNER COLINS, Senior Judge
OPINION NOT REPORTED
MEMORANDUM OPINION BY
SENIOR JUDGE COLINS FILED: October 31, 2018
This matter is an appeal by Steven L. Holtzapple (Holtzapple) from an
order of the Court of Common Pleas of York County (trial court) that found him in
contempt for violating a prior order that set aside an upset tax sale and vacated the
prior order and directed that the tax sale be finalized as a civil contempt sanction for
that violation. For the reasons set forth below, we affirm the trial court’s decision
insofar as it found Holtzapple in contempt, but vacate the trial court’s setting aside
of its prior order and its direction that the tax sale be finalized.
On September 24, 2015, the York County Tax Claim Bureau (Bureau)
sold a property that Holtzapple owned in West Manchester Township, York County
(the Property) at an upset tax sale for failure to pay real estate taxes on the Property.
(Trial Court Op. at 1; Exceptions and Objections to Tax Sale ¶¶1, 4-5, Reproduced
Record (R.R.) at 1a-2a; Petition for Contempt ¶¶3-4 & Ex. A, R.R. at 17a-18a, 22a.)
Appellee CJD Group, LLC (Purchaser) was the successful bidder for the Property
and paid a total bid amount of $13,311.58. (Petition for Contempt ¶5 & Ex. A, R.R.
at 18a, 22a; Exceptions and Objections to Tax Sale ¶5, R.R. at 2a.) The assessed
value of the Property was $96,600. (Petition for Contempt Ex. A, R.R. at 22a;
Exceptions and Objections to Tax Sale ¶4, R.R. at 2a.)
On October 23, 2015, Holtzapple filed exceptions and objections to the
tax sale, asserting that the Bureau did not provide him the required notice of the tax
sale. (Exceptions and Objections to Tax Sale ¶¶6-8, R.R. at 2a.) Neither the Bureau
nor Purchaser answered the exceptions and objections to the tax sale. On November
9, 2016, following a case management conference, the trial court issued a rule to
show cause why the tax sale should not be set aside, ordering that Purchaser file an
answer to Holtzapple’s exceptions and objections to the tax sale within 20 days and
stating that if no answer was filed, Holtzapple could file a motion to make the rule
absolute and a proposed order granting the relief sought in the exceptions and
objections. (11/9/16 Trial Court Order, R.R. at 6a-7a.) Purchaser did not file any
answer following the rule to show cause. (Trial Court Op. at 2; Trial Court Docket
Entries.) The rule to show cause did not order the Bureau to file an answer and the
Bureau did not file any response to the rule to show cause. (11/9/16 Trial Court
Order, R.R. at 6a-7a; Trial Court Op. at 2; Trial Court Docket Entries.) On January
9, 2017, Holtzapple filed a motion to make the rule absolute.
On January 11, 2017, the trial court issued an order granting the relief
sought in the motion to make the rule absolute and vacating the tax sale. The January
11, 2017 order provided in relevant part:
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…[I]n accordance with the attached Motion, the Upset Sale for
[the Property], as conducted by the York County Tax Claim
Bureau on September 24th, 2015, is hereby vacated.
Any Deed conveying the above-referenced property to the
Respondents, CJD Group, LLC, if filed and applicable, is hereby
voided.
If there is no appeal filed within thirty (30) days of this
Order, Petitioner is directed to file a certified copy of this Order
with the Recorder of Deeds in order to clear the chain of title.
It is further ordered that the Petitioner shall pay to the York
County Tax Claim Bureaus [sic] within thirty-one (31) days of
the entry of this Order, all delinquent real estate taxes together
with penalty and interest due and owing with respect to this
property.
(1/11/17 Trial Court Order, R.R. at 12a.) The January 11, 2017 order was the
proposed order requested by Holtzapple in his motion – the order bears the name
and address of Holtzapple’s counsel and references the “attached Motion” to make
the rule absolute filed by Holtzapple. (Id., R.R. at 12a-13a.) No appeal was taken
by any party from this order.
Holtzapple did not make any payment of the delinquent real estate taxes
or penalty and interest as required by the January 11, 2017 order. (Trial Court Op.
at 3-4; Hearing Transcript (H.T.) at 10, 12, R.R. at 44a, 46a.) On June 5, 2017, the
Bureau filed a petition for contempt seeking to vacate the setting aside of the tax
sale, confirm the validity of the tax sale, and permit finalization of the sale as a
sanction. (Petition for Contempt, R.R. at 16a-24a.) On June 15, 2017, the trial court
issued an order scheduling a hearing on the petition for contempt for July 6, 2017
and providing that “Holtzapple is advised that failure to appear at this hearing will
result in the issuance of a bench warrant for [his] arrest.” (6/15/17 Order, R.R. at
25a.)
3
Counsel for Holtzapple appeared at the July 6, 2017 hearing, but
Holtzapple failed to appear. (Trial Court Op. at 3; H.T. at 2-3, R.R. at 36a-37a.) At
the hearing, counsel for Holtzapple admitted that he notified Holtzapple of the
hearing, did not dispute that Holtzapple knew of the January 11, 2017 order, and
admitted that Holtzapple had not complied with the order’s requirement that he pay
the taxes, penalty and interest. (Trial Court Op. at 3; H.T. at 2-3, 10, 12, 19, R.R. at
36a-37a, 44a, 46a, 53a.) Counsel for Holtzapple argued only that Holtzapple should
not be found in contempt because he lacked the financial ability to comply with the
January 11, 2017 order and that even if he was in contempt, the order could not be
vacated. (H.T. at 2-3, 6-8, 12-14, 17-20, R.R. at 36a-37a, 40a-42a, 46a-48a, 51a-
54a.) Counsel for Holtzapple did not introduce any evidence at the hearing
concerning Holtzapple’s income or financial condition.
At the July 6, 2017 hearing, the trial court issued an order, entered on
the docket on July 10, 2017, in which it found Holtzapple in contempt of the January
11, 2017 order, and, as a civil contempt sanction, vacated the January 11, 2017 order
setting aside the tax sale and directed that the tax sale be finalized. (7/6/17 Trial
Court Order; H.T. 22-23, R.R. at 56a-57a.) Holtzapple timely appealed the trial
court’s order to this Court. The parties in this appeal are Holtzapple and the Bureau;
Purchaser did not file a brief and was barred from participating in oral argument.
In this Court,1 Holtzapple argues that the elements of contempt were
not proven and that even if he was properly found in contempt, vacating the setting
aside of the tax sale and directing that the tax sale be finalized were not permissible
civil contempt sanctions for that violation. We conclude that the trial court did not
1
In an appeal from a contempt order, this Court’s review is limited to determining whether the
trial court abused its discretion or committed an error of law. West Pittston Borough v. LIW
Investments, Inc., 119 A.3d 415, 421 n.9 (Pa. Cmwlth. 2015).
4
err in finding Holtzapple in contempt of its January 11, 2017 order, but that it lacked
the power to vacate its prior order setting aside the tax sale and to direct that the tax
sale be finalized.
In a civil contempt proceeding, the burden is on the complaining party
to prove violation of the court order by a preponderance of the evidence. Barrett v.
Barrett, 368 A.2d 616, 621 (Pa. 1977); West Pittston Borough v. LIW Investments,
Inc., 119 A.3d 415, 421 (Pa. Cmwlth. 2015); Cecil Township v. Klements, 821 A.2d
670, 675 (Pa. Cmwlth. 2003). Moreover, the language of the order that the
contemnor violated must be definite, clear, and specific. Bold v. Bold, 939 A.2d
892, 895 (Pa. Super. 2007); Lachat v. Hinchcliffe, 769 A.2d 481, 488-89 (Pa. Super.
2001). Holtzapple does not dispute that the language of the January 11, 2017 order
requiring him to make payment of delinquent taxes, penalty, and interest with respect
to the Property within 31 days was clear.2 The record before the trial court and the
admissions of Holtzapple’s counsel established that Holtzapple had notice of the
January 11, 2017 order and that he did not comply with that order despite having
over five months to do so. The January 11, 2017 order was proposed to the trial
court by Holtzapple’s counsel and the record shows that a copy of the entered order
was faxed to Holtzapple’s counsel on January 13, 2017. (1/11/17 Trial Court Order,
R.R. at 12a-13a; Trial Court Docket Entry No. 19.) At the July 6, 2017 contempt
hearing, Holtzapple’s counsel stipulated that as of that date, over five months after
the January 11, 2017 order, Holtzapple had not paid any of the taxes, penalty and
interest. (H.T. at 10, 12, R.R. at 44a, 46a.)
2
While the January 11, 2017 order did not set forth the amount of the delinquent taxes, penalty,
and interest, there is no issue of ambiguity of the amount, as Holtzapple does not contend that he
did not know the amount and he made no payment at all, not a payment that he contended complied
with the order.
5
Holtzapple argues that he could not be held in contempt because there
was no evidence that his failure to pay was volitional or with wrongful intent. We
do not agree. Civil contempt may be proved by circumstantial evidence and logical
inference from other facts. Commonwealth v. Reese, 156 A.3d 1250, 1258 (Pa.
Super. 2017). Wrongful intent can be inferred where it is clear from the language of
the court order that the conduct in question violates the court order and the evidence
shows that the contemnor knowingly failed to comply. Id. at 1258-60;
Commonwealth v. Lambert, 147 A.3d 1221, 1227 (Pa. Super. 2016). Because
Holtzapple knew of the January 11, 2017 order and its requirement that payment be
made within 31 days was clear, the trial court could properly infer that his
nonpayment was with wrongful intent. Because Holtzapple did nothing to comply
for a period of over five months despite knowledge of the order, the trial court could
infer that his conduct was volitional.
Holtzapple also contends that there was no evidence that he had the
financial ability to pay. Contempt cannot be found if the defendant or respondent,
without fault on his part, is unable to comply with the court order and has attempted
in good faith to comply. Cecil Township, 821 A.2d at 675; Cunningham v.
Cunningham, 182 A.3d 464, 471 (Pa. Super. 2018). Inability to comply with the
order, however, is an affirmative defense that must be proved by the contemnor.
Cecil Township, 821 A.2d at 675; Cunningham, 182 A.3d at 471; see also Barrett,
368 A.2d at 621 (inability to comply is an affirmative defense that must be proved
by contemnor, but a court cannot impose coercive imprisonment as a sanction for
failure to pay where contemnor presents evidence of financial inability unless the
court is convinced beyond reasonable doubt that contemnor has ability to pay the
amount required to purge contempt). There was no evidence that Holtzapple was
6
unable to comply with the order because he did not appear at the contempt hearing
and his counsel did not introduce any documentary evidence of his financial
condition.
Although the trial court did not err in its contempt finding, the sanction
that it imposed cannot stand. The trial court vacated its January 11, 2017 order and
directed that the tax sale that was set aside by that order be finalized. The January
11, 2017 order was a final order, as it disposed of all claims of all parties in
Holtzapple’s exceptions and objections to the tax sale. Pa. R.A.P. 341(b)(1). Under
Section 5505 of the Judicial Code, a trial court loses jurisdiction to modify or vacate
a final order where more than 30 days have passed after the order was entered. 42
Pa. C.S. § 5505; In re Consolidated Return of Real Estate Tax Sale, 74 A.3d 1089,
1093-94 (Pa. Cmwlth. 2013); Fleetwood Area School District v. Berks County Board
of Assessment Appeals, 821 A.2d 1268, 1275 (Pa. Cmwlth. 2003); Gardner v.
Consolidated Rail Corp., 100 A.3d 280, 283 (Pa. Super. 2014). The trial court’s
sanction vacating the January 11, 2017 order was imposed in July 2017, far outside
the 30-day period when it retained jurisdiction to vacate that order.
A limited exception exists, under which a trial court can modify or
vacate a prior final order more than 30 days after its entry, where there is fraud, lack
of subject matter jurisdiction, a fatal defect on the face of the record, or some other
circumstance that constitutes extraordinary cause, such as administrative or court
error that denied a party notice of an order or proceeding. Pendle Hill v. Zoning
Hearing Board of Nether Providence Township, 134 A.3d 1187, 1202 (Pa. Cmwlth.
2016); Fulton v. Bedford County Tax Claim Bureau, 942 A.2d 240, 242 n.3 (Pa.
Cmwlth. 2008); Ainsworth v. Department of Transportation, Bureau of Driver
Licensing, 807 A.2d 933, 937 (Pa. Cmwlth. 2002); Manufacturers & Traders Trust
7
Co. v. Greenville Gastroenterology, SC, 108 A.3d 913, 919 (Pa. Super. 2015). The
Bureau, however, has neither alleged nor shown any fraud, breakdown in court
procedures, jurisdictional or facial defect in the January 11, 2017 order, or any other
circumstance that rises to the level of extraordinary cause.3 Because the trial court
lacked jurisdiction to modify or vacate its January 11, 2017 order when it imposed
sanctions on Holtzapple, we must vacate the trial court’s July 6, 2017 order insofar
as it vacated the January 11, 2017 order and directed that the tax sale be finalized.4
3
Although Holtzapple’s counsel raised this jurisdictional issue before the trial court (H.T. at 6-8,
12-14, R.R. at 40a-42a, 46a-48a), the Bureau did not contend that the January 11, 2017 order
setting aside the tax sale had been obtained by fraud or that any defect in the order existed. The
Bureau introduced no evidence from any person involved in the case when the order was entered
and argued only that the court’s contempt power permitted it to vacate the order on the ground that
other sanctions were not sufficient. (Id. at 6-7, 10, 14-17, R.R. at 40a-41a, 44a, 48a-51a.)
4
Holtzapple also argues that the sanctions imposed by the trial court were criminal contempt
sanctions because the trial court did not give him an opportunity to avoid the sanctions by purging
the contempt and that the sanctions were improper because the tax sale was legally invalid. We
do not rest our judgment on either of these grounds. Civil contempt sanctions may be imposed to
coerce compliance with the court’s order or to compensate the complainant for the loss from the
contemnor’s violation of the order. Department of Environmental Protection v. Cromwell
Township, Huntingdon County, 32 A.3d 639, 643 n.4 (Pa. 2011); Mrozek v. James, 780 A.2d 670,
674 (Pa. Super. 2001). While imposition of imprisonment or other penalties can be imposed as a
civil contempt sanction only where the contemnor can avoid the sanction by complying with the
court order, that requirement does not apply where the sanction is solely compensatory. Capital
Bakers, Inc. v. Local Union No. 464 of the Bakery and Confectionary Workers International
Union, 422 A.2d 521, 525 (Pa. Super. 1980). The purpose of the trial court’s sanction here was to
compensate the Bureau for Holtzapple’s failure to comply by allowing the Bureau to receive the
payment that he failed to make from the tax sale proceeds, not to coerce Holtzapple’s compliance
with the order. (Trial Court Op. at 8-9.) With respect to the second of these arguments,
Holtzapple’s assertions that the record shows non-compliance with the Real Estate Tax Sale Law,
Act of July 7, 1947, P.L. 1368, as amended, 72 P.S. §§ 5860.101-5860.803, are incorrect. At the
contempt hearing, the Bureau sought to introduce evidence that it had given Holtzapple the
required notice of the tax sale, but Holtzapple’s counsel objected on the ground that the January
11, 2017 order resolved the issue of insufficiency of notice and the only issue was whether
Holtzapple had complied with the January 11, 2017 order. (H.T. at 4-10, R.R. at 38a-44a.) As a
consequence, there is nothing in the record demonstrating that the tax sale was or was not valid.
8
This does not mean that the trial court is powerless to impose any
sanction on Holtzapple for his failure to comply with the order or that conducting a
new tax sale would make the Bureau whole for the financial loss from his contempt.
As Holtzapple conceded at oral argument, the trial court can properly award the
Bureau attorney fees to compensate it for its costs in bringing the contempt motion
as a civil contempt sanction in this case. We therefore remand this matter to the trial
court for further proceedings at which it may impose civil contempt sanctions for
Holtzapple’s contempt of the January 11, 2017 order that do not vacate or contravene
that prior final order.
For the foregoing reasons, we affirm the trial court’s finding of
contempt, vacate its order insofar as it vacated the January 11, 2017 order and
directed that the tax sale be finalized, and remand this matter to the trial court for
further proceedings consistent with this opinion.
____________________________________
JAMES GARDNER COLINS, Senior Judge
9
IN THE COMMONWEALTH COURT OF PENNSYLVANIA
Steven L. Holtzapple, :
:
Appellant :
: No. 1114 C.D. 2017
v. :
:
CJD Group, LLC and York County :
Tax Claim Bureau :
ORDER
AND NOW, this 31st day of October, 2018, the Order of July 6, 2017
of the Court of Common Pleas of York County is AFFIRMED IN PART and
VACATED IN PART. Said Order is AFFIRMED insofar as it found Appellant in
contempt. Said Order is VACATED insofar as it vacated that court’s January 11,
2017 order and directed that the tax sale set aside by the January 11, 2017 order be
finalized, and this matter is remanded to the Court of Common Pleas of York County
for further proceedings in accordance with the foregoing opinion.
Jurisdiction relinquished.
____________________________________
JAMES GARDNER COLINS, Senior Judge