Posted by: Patricia Salkin | July 25, 2014

Third Circuit Court of Appeals Holds Tabling of a Development Agreement was a Substantive Legislative Action

Northeast Land Development, LLC (“Northeast Land”), agreed to purchase a parcel of land in the City of Scranton, Pennsylvania and then submitted a subdivision plan to the City for approval. The Planning Commission endorsed the plan, and a resolution was introduced in the City Council to negotiate a Development Agreement with Northeast Land. Before consideration of the resolution, one of the five members of the Scranton City Council (“Individual Defendants”) met with Northeast Land and told it Council would not vote on the Development Agreement until another developer made progress on an adjacent development. The Council tabled the resolution, which prevented Northeast Land from closing.

Subsequently, Northeast Land commenced a 1983 action against the City and the Individual Defendants for violation of its Fourteenth Amendment substantive and procedural due process rights. Northeast Land alleged that Council tabled its resolution because Northeast Land had not met the “outrageous conditions for approval” that were not required by law The District Court dismissed the Individual Defendants from the case, holding that their legislative immunity as Council members shielded them from the claims. Only the procedural due process claim against the City of Scranton survived.

With respect to the remaining claim, the District Court requested briefing as to whether there was a right to procedural due process for legislative action, and if not, whether Council’s decision to table the resolution was legislative action. The District Court held that tabling the resolution constituted legislative action for which Northeast Land did not have a procedural due process right. Northeast Land appealed.

On appeal, Northeast Land raised two arguments. First, citing a United States Court of Appeals, Third Circuit decision, Carver v. Foerster, 102 F.3d 96 (3d Cir.1996), in which the court held that legislative immunity applies only to individually named defendants, Northeast Land claimed the legislative immunity defense was unavailable to the City. The Court stated, however, that this argument was wrong because the District Court never suggested that the City was entitled to legislative immunity. Rather, the District Court dismissed Northeast Land’s claim against the City because procedural due process did not extend to legislative action. Next, Northeast Land contended the District Court erred by holding that the Individual Defendants were entitled to legislative immunity. Specifically, Northeast Land asserted that Council did not take legislative action for immunity purposes by deciding to table the resolution. The court did not need to reach the merits of this argument because, as the individual Defendants argued, Northeast Land’s procedural due process claim against them failed because there was no right to procedural due process for legislative action. Thus, Northeast Land’s claim turned on whether Council’s act was legislative. The court stated that an act is legislative in nature if it is both substantively and procedurally legislative. Acierno v. Cloutier, 40 F.3d 597, 610 (3d Cir.1994). Here, Northeast Land disputed only whether City Council’s decision to table the resolution was substantive legislative action. Specifically, the Council’s role to review proposed developments once the Planning Commission approved them. The court stated that an act was substantive legislative action if it involves either the enactment or amendment of legislation. The enforcement of already existing laws was not legislative action.

The Scranton Development Ordinance enumerated eleven conditions that Council can impose on a development agreement. Northeast Land argued that this ordinance cabined Council’s discretion as it had a purely administrative function of passing the resolution and had no power to review the Planning Commission’s decision or to impose conditions.
However, the court stated that this argument was contradicted by the same ordinance, which stated, “The development agreement shall be acceptable in content to the governing body.” Further, one of the eleven enumerated conditions was a broad catch-all, which authorized “any other lawful terms which the governing body may require to carry out the provisions of this chapter.”

Accordingly, the court agreed with the District Court’s observation that “to hold that the Scranton City Council had only a perfunctory role in the approval process, it would be required to construe the Development Ordinance in a manner that ignored its plain text. The Council’s decision to table the development agreement was quintessentially substantive legislative action.”

Northeast Land Dev., LLC v City of Scranton, 561 Fed Appx 135 (3rd Cir. Ct. App. 3/29/2014)

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