SENATE AMENDED
PRIOR PRINTER'S NOS. 1199, 1324, 1956 PRINTER'S NO. 2345
No. 1076 Session of 1995
INTRODUCED BY MERRY, SCHRODER, PISTELLA, BARD, HENNESSEY, CURRY,
SANTONI, WOZNIAK, PETTIT, FEESE AND WALKO, MARCH 8, 1995
AS AMENDED ON SECOND CONSIDERATION, IN SENATE, JUNE 28, 1995
AN ACT
1 Amending the act of May 16, 1923 (P.L.207, No.153), entitled "An
2 act providing when, how, upon what property, and to what
3 extent, liens shall be allowed for taxes and for municipal
4 improvements, for the removal of nuisances, and for water
5 rents or rates, sewer rates, and lighting rates; for the
6 procedure upon claims filed therefor; the methods for
7 preserving such liens and enforcing payment of such claims;
8 the effect of judicial sales of the properties liened; the
9 distribution of the proceeds of such sales, and the
10 redemption of the property therefrom; for the lien and
11 collection of certain taxes heretofore assessed, and of
12 claims for municipal improvements made and nuisances removed,
13 within six months before the passage of this act; and for the
14 procedure on tax and municipal claims filed under other and
15 prior acts of Assembly," providing for attorney fees in
16 actions involving municipal claims; AND AUTHORIZING CERTIFIED <--
17 MAIL TO NOTIFY PROPERTY OWNERS OF PETITIONS OR RULES.
18 The General Assembly of the Commonwealth of Pennsylvania
19 hereby enacts as follows:
20 Section 1. Section 3(a) of the act of May 16, 1923 (P.L.207,
21 No.153), referred to as the Municipal Claim and Tax Lien Law,
22 amended December 19, 1990 (P.L.1092, No.199), is amended and the
23 section is amended by adding subsections to read:
24 Section 3. (a) All municipal claims which may hereafter be
1 lawfully imposed or assessed on any property in this
2 Commonwealth, and all such claims heretofore lawfully imposed or
3 assessed within six months before the passage of this act and
4 not yet liened, in the manner and to the extent hereinafter set
5 forth, shall be and they are hereby declared to be a lien on
6 said property, together with all charges, expenses, and fees
7 incurred in the collection of any delinquent account, including
8 reasonable attorney fees, added thereto for failure to pay
9 promptly; and said liens shall arise when lawfully imposed and
10 assessed and shall have priority to and be fully paid and
11 satisfied out of the proceeds of any judicial sale of said
12 property, before any other obligation, judgment, claim, lien, or
13 estate with which the said property may become charged, or for
14 which it may become liable, save and except only the costs of
15 the sale and of the writ upon which it is made, and the taxes
16 imposed or assessed upon said property.
17 (a.1) IT IS NOT THE INTENT OF THIS SUBSECTION TO REQUIRE <--
18 OWNERS TO PAY, OR MUNICIPALITIES TO SANCTION, INAPPROPRIATE OR
19 UNREASONABLE ATTORNEY FEES, CHARGES OR EXPENSES FOR ROUTINE
20 FUNCTIONS. Attorney fees incurred in the collection of any
21 delinquent account shall be in an amount sufficient to
22 compensate attorneys undertaking collection and representation
23 of a municipality in actions involving claims arising under this
24 act as provided in subsection (a). In the event a delinquent <--
25 property owner challenges the amount of the attorney fee, the
26 ACT AS PROVIDED BY SUBSECTION (A). A MUNICIPALITY BY OFFICIAL <--
27 ACTION SHALL SEEK COURT APPROVAL OF THE SCHEDULE, PRIOR TO THE
28 ADOPTION OF THE SCHEDULE, OF THE AMOUNT OF ATTORNEY FEES TO BE
29 ASSESSED. THE court shall consider, but not be limited to, the
30 following:
19950H1076B2345 - 2 -
1 (1) The time and labor required, the novelty and difficulty
2 of the questions involved and the skill requisite to properly
3 undertake collection and representation of a municipality in
4 actions arising under subsection (a).
5 (2) The customary charges of the members of the bar for
6 similar services.
7 (3) The amount involved in the controversy and the benefits
8 resulting to the client or clients from the services.
9 (4) The contingency or the certainty of the compensation.
10 (a.2) Any time attorney fees are awarded pursuant to any
11 provision of law, the municipality shall not be entitled to
12 duplicate recovery of attorney fees under this section.
13 (a.3) At least thirty days prior to any imposition or
14 assessment of attorney fees in accordance with this section, the
15 municipality shall notify the owner by first class mail of: THE <--
16 MANNER OF SERVICE AS PROVIDED FOR PURSUANT TO PA.R.C.P. NO.402
17 OR BY CERTIFIED MAIL, RETURN RECEIPT REQUESTED. IF THE CERTIFIED
18 MAIL IS REFUSED OR UNCLAIMED, THEN NOTIFICATION SHALL BE MADE BY
19 FIRST CLASS MAIL. THE NOTIFICATION SHALL INCLUDE THE FOLLOWING:
20 (1) The municipality's intent to impose or assess attorney
21 fees AFTER THE THIRTY-DAY PERIOD HAS EXPIRED. <--
22 (2) The manner in which the imposition or assessment of
23 attorney fees may be avoided by payment of the delinquent
24 account AND THE PROCESS BY WHICH THE DELINQUENT PROPERTY OWNER <--
25 MAY MAKE ARRANGEMENTS FOR INSTALLMENT PAYMENTS WITH THE
26 MUNICIPALITY PRIOR TO THE IMPOSITION OR ASSESSMENT OF ATTORNEY
27 FEES.
28 (3) A statement of the fixed fees and hourly rate or rates
29 to be applied in computing the amount of attorney fees which may
30 be imposed or assessed.
19950H1076B2345 - 3 -
1 * * *
2 Section 2. Sections 19 and 20 of the act are amended to
3 read:
4 Section 19. If no affidavit of defense be filed within the
5 time designated, judgment may be entered and damages assessed by
6 the prothonotary by default, for want thereof. Such assessment
7 shall include a [five per cent] fee for collection to
8 plaintiff's attorney in accordance with section 3.
9 If an affidavit of defense be filed, a rule may be taken for
10 judgment for want of sufficient affidavit of defense, or for so
11 much of the claim as is insufficiently denied, with leave to
12 proceed for the residue.
13 The defendant may, by rule, require the plaintiff to reply,
14 under oath or affirmation, to the statements set forth in the
15 affidavit of defense, and after the replication has been filed
16 may move for judgment on the whole record.
17 Section 20. Tax claims and municipal claims shall be prima
18 facie evidence of the facts averred therein in all cases; and
19 the averments in both tax and municipal claims shall be
20 conclusive evidence of the facts averred therein, except in the
21 particulars in which those averments shall be specifically
22 denied by the affidavit of defense, or amendment thereof duly
23 allowed. A compulsory nonsuit, upon trial, shall be equivalent
24 to a verdict for defendant, whether the plaintiff appeared or
25 not. If plaintiff recovers a verdict, upon trial, in excess of
26 the amount admitted by the defendant in his affidavit of defense
27 or pleadings, he shall be entitled to [an attorney's fee]
28 attorney fees for collection[, equal to five per centum of such
29 excess, but not exceeding fifty dollars] in accordance with
30 section 3.
19950H1076B2345 - 4 -
1 SECTION 3. THIS ACT SHALL APPLY RETROACTIVELY TO ALL CLAIMS <--
2 FILED ON OR AFTER DECEMBER 19, 1990.
3 SECTION 3. SECTION 39.2 OF THE ACT, ADDED DECEMBER 14, 1992 <--
4 (P.L.858, NO.135), IS AMENDED TO READ:
5 SECTION 39.2. (A) IN CITIES OF THE FIRST CLASS, NOTICE OF A
6 RULE TO SHOW CAUSE WHY A PROPERTY SHOULD NOT BE SOLD FREE AND
7 CLEAR OF ALL ENCUMBRANCES ISSUED BY A COURT PURSUANT TO A
8 PETITION FILED BY A CLAIMANT UNDER SECTION 31.2 OF THIS ACT
9 SHALL BE SERVED BY THE CLAIMANT UPON OWNERS, MORTGAGEES, HOLDERS
10 OF GROUND RENTS, LIENS AND CHARGES OR ESTATES OF WHATSOEVER KIND
11 AS FOLLOWS:
12 (1) BY POSTING A TRUE AND CORRECT COPY OF THE PETITION AND
13 RULE ON THE MOST PUBLIC PART OF THE PROPERTY;
14 (2) BY MAILING BY FIRST CLASS MAIL TO THE ADDRESS REGISTERED
15 BY ANY INTERESTED PARTY PURSUANT TO SECTION 39.1 OF THIS ACT A
16 TRUE AND CORRECT COPY OF THE PETITION AND RULE; AND
17 (3) BY REVIEWING A TITLE SEARCH, TITLE INSURANCE POLICY OR
18 TAX INFORMATION CERTIFICATE THAT IDENTIFIES INTERESTED PARTIES
19 OF RECORD WHO HAVE NOT REGISTERED THEIR ADDRESSES PURSUANT TO
20 SECTION 39.1 OF THIS ACT, THE CITY SHALL MAIL BY FIRST CLASS
21 MAIL AND [BY] EITHER BY CERTIFIED MAIL, RETURN RECEIPT
22 REQUESTED, OR BY REGISTERED MAIL TO SUCH ADDRESSES AS APPEAR ON
23 THE RESPECTIVE RECORDS RELATING TO THE PREMISES A TRUE AND
24 CORRECT COPY OF THE PETITION AND RULE.
25 THE CITY SHALL FILE AN AFFIDAVIT OF SERVICE WITH THE COURT PRIOR
26 TO SEEKING A DECREE ORDERING THE SALE OF THE PREMISES.
27 (B) NO PARTY WHOSE INTEREST DID NOT APPEAR ON A TITLE
28 SEARCH, TITLE INSURANCE POLICY OR TAX INFORMATION CERTIFICATE OR
29 WHO FAILED TO ACCURATELY REGISTER HIS INTEREST AND ADDRESS
30 PURSUANT TO SECTION 39.1 OF THIS ACT SHALL HAVE STANDING TO
19950H1076B2345 - 5 -
1 COMPLAIN OF IMPROPER NOTICE IF THE CITY SHALL HAVE COMPLIED WITH
2 SUBSECTION (A) OF THIS SECTION. THIS PROVISION SHALL NOT APPLY
3 IF THE MORTGAGE OR INTEREST WAS OTHERWISE PROPERLY RECORDED IN
4 THE OFFICE OF THE RECORDER OF DEEDS AND THE DOCUMENT CONTAINS A
5 CURRENT ADDRESS SUFFICIENT TO SATISFY THE NOTICE REQUIREMENTS OF
6 THIS SECTION.
7 (C) NOTICE OF THE COURT'S DECREE ORDERING A TAX SALE,
8 TOGETHER WITH THE TIME, PLACE AND DATE OF THE SALE, SHALL BE
9 SERVED BY FIRST CLASS MAIL ON ALL PARTIES SERVED WITH THE
10 PETITION AND RULE, ON ANY PARTIES WHOSE INTEREST APPEARED OF
11 RECORD AFTER THE FILING OF THE PETITION BUT BEFORE THE COURT'S
12 DECREE AND ON ANY CREDITOR WHO HAS OBTAINED JUDGMENT AGAINST THE
13 OWNER OF THE PREMISES PRIOR TO THE DATE OF THE DECREE. THE CITY
14 SHALL FILE AN AFFIDAVIT OF SERVICE OF THESE NOTICES PRIOR TO THE
15 DATE OF THE SALE.
16 SECTION 4. (A) THIS ACT SHALL APPLY AS FOLLOWS:
17 (1) EXCEPT AS PROVIDED IN PARAGRAPH (2), THIS ACT SHALL
18 APPLY RETROACTIVELY TO ALL CLAIMS FILED ON OR AFTER DECEMBER
19 19, 1990.
20 (2) PARAGRAPH (1) SHALL NOT APPLY TO THE ADDITION OF
21 SECTION 3(A.1) OF THE ACT PERTAINING TO THE COURT APPROVAL OF
22 THE SCHEDULE OR TO THE ADDITION OF SECTION 3(A.3) OF THE ACT.
23 (3) NO MUNICIPALITY SHALL BE LIABLE TO ANY ATTORNEY FOR
24 THE AMOUNT OF ANY ATTORNEY FEES FOUND TO BE UNREASONABLE BY
25 THE COURT IN CONNECTION WITH THE ADDITION OF SECTION 3(A.1)
26 OF THE ACT.
27 (B) IN THE EVENT A DELINQUENT PROPERTY OWNER FILES A
28 CHALLENGE OVER THE AMOUNT OF THE ATTORNEY FEES INCURRED DURING
29 THE RETROACTIVITY PERIOD, THE COURT SHALL CONSIDER, BUT NOT BE
30 LIMITED TO, THE PROVISIONS OF SECTION 3(A.1)(1), (2), (3) AND
19950H1076B2345 - 6 -
1 (4) OF THE ACT.
2 Section 3 4 5. This act shall take effect in 60 days. <--
B23L53PJP/19950H1076B2345 - 7 -