Judges Opinions, — October 3, 2018 10:00 — 0 Comments

KNG Lincoln Properties vs. Zoning Hearing Board of South Lebanon Township vs. South Lebanon Township No. 2014-01264

Civil Action-Law-Property Use-Zoning-Zoning Hearing Board Discretion-Renovation of Deteriorated Structure-Residential District-Retail and Commercial Uses-Substantial Evidence-Increased Traffic-Road Topography

KNG Lincoln Properties, LLC, (“Appellant”) purchased a property previously used for sales and manufacturing purposes in which the structures had deteriorated in a medium density residential district and requested permission to renovate and to subdivide the structure for use by seven (7) tenants, as well as to transform an accessory building previously used for storage to house an additional business. The Zoning Hearing Board of South Lebanon Township (“Zoning Hearing Board”) permitted the use of the main building for up to three (3) retail and commercial uses and denied the request to transform the accessory building into space for a business. Appellant appealed the decision, asserting that the decision of the Zoning Hearing Board is not based upon substantial evidence and the decision is arbitrary, unreasonable, contradictory and ambiguous, as it permits various uses yet limits Appellant to select three (3) such uses.

1. Since the trial court did not receive any additional evidence, the trial court’s role is to determine whether the Zoning Hearing Board committed a manifest abuse of discretion or an error of law.
2. An abuse of discretion exists only when the Board’s findings are not supported by substantial evidence. Substantial evidence means information that would be sufficient to enable a reasonable mind to support the conclusion rendered.
3. The trial court cannot substitute its judgment for that of the Zoning Hearing Board in its role as fact finder to evaluate witness credibility and to assign evidentiary weight.
4. The Zoning Hearing Board’s decision limiting the scope of the project is supported by substantial evidence where the manager of South Lebanon Township provided testimony regarding increased traffic potentially created by the project as proposed and problems posed by the topography of the road upon which utility trailers would be pulled if the property were permitted to be used for storage as proposed and neighbors expressed concern about the number of retail uses requested for the property.
5. Since it is not clear from the decision or the record whether the Zoning Hearing Board wished to limit the use of the property to three (3) tenants as opposed to three (3) uses of the property, the matter is remanded to the Zoning Hearing Board to delineate whether its limitation pertains to use, tenancy or both.
L.C.C.C.P. No. 2014-01264, Opinion by Bradford H. Charles, Judge, January 5, 2018.

CIVIL ACTION – LAW No. 2014-01264


AND NOW, this 5th day of January, 2018, in accordance with the attached Opinion, the above-referenced matter is remanded to the Zoning Hearing Board of South Lebanon Township for further proceedings consistent with the attached Opinion.




Scott L. Grenoble, Esquire FOR PLAINTIFFS

Timothy Sheffey, Esquire FOR DEFENDANTS

Keith Kilgore, Esquire FOR INTERVENOR

OPINION BY CHARLES, J., January 5, 2018
This is an appeal from a decision rendered by the South Lebanon Township Zoning Hearing Board (hereafter ZHB). For the following reasons, our sympathies are with PLAINTIFF KNG Lincoln Properties, LLC (hereafter APPELLANT):
• As a general philosophy, we believe that the ability of the government to interfere with decisions of landowners pertaining to their own property should be limited. 1
• In this case, the APPELLANTS purchased a deteriorating structure that was becoming an eyesore and a nuisance. They then expended considerable money to make it safe and visually appealing. We believe that local government should be encouraging structural rehabilitation instead of making projects such as the one proposed by APPELLANT more difficult.
• As noted above, the APPELLANTS have already expended considerable money to improve a once dilapidated structure. They intend to recoup their investment by leasing space inside the renovated structure. We would hope that a local government would want a project like this to be economically viable.
• The primary reason the Township has advanced for limiting APPELLANT’s use of their property is a concern about traffic. Although this is a legitimate concern, we are well aware that a massive residential, commercial and retail development is currently in the process of being constructed less than two (2) miles from the location of APPELLANT’s rehabilitated structure. Problems with traffic related to APPELLANT’s project will literally pale in comparison to the increased traffic flow that will be generated from the already-under-construction Springwood Development.
Notwithstanding our visceral reaction to APPELLANT’s Request for Relief, we must intellectually acknowledge that the law does not favor APPELLANTS. As we will articulate in more detail within the body of this Opinion, we are required to afford great respect to the decision and reasoning of the Zoning Hearing Board; we cannot substitute our own preference for that of the Board. Given our very limited scope of review, we are constrained to affirm the ZHB’s decision to limit the scope of APPELLANT’s project. However, because we are somewhat confused about the extent of the ZHB’s limitations, we will be remanding this dispute to the ZHB. This Opinion is intended to explain our reasoning to the parties.
Appellant KNG Lincoln Properties, LLC (hereafter APPELLANT) is the owner of a premises located at 731 South Lincoln Avenue, South Lebanon Township. (Said property will hereafter be referred to as “PREMISES”.) The PREMISES was owned and operated for years by a company named Ace Aluminum. (ZHB Finding of Fact 3). It is improved with one “main building” previously used for sales and manufacturing purposes and one outbuilding that had been previously been used for storage. (ZHB Finding of Fact 1). The PREMISES is located in the medium density residential district of South Lebanon Township. (ZHB Finding of Fact 2).
APPELLANT became the owner of the PREMISES on December 30, 2016. By this time, the Ace Aluminum business had dwindled and the structures on the PREMISES had begun to deteriorate. APPELLANT’s vision for the property was to renovate and subdivide it for use by as many as seven (7) tenants. (ZHB Finding of Fact 5). APPELLANT requested permission to expand the type of retail and commercial uses for the PREMISES to include personal service shops such as beauty shops, medical or dental clinics, professional offices, “indoor amusement facilities”, restaurants and self-storage facilities. (ZHB Finding of Fact 6).
Although the PREMISES had been used for non-conforming business purposes prior to its purchase by APPELLANTS, no more than two business occupied the structure at any one time. (ZHB Finding of Fact 9). The uses proposed by APPELLANTS would be non-conforming and would constitute an expansion of the grandfathered commercial use of the property. (ZHB Finding of Fact 9).
In addition to proposing an expansion of usage for the main building, APPELLANT also submitted a request to transform the accessory building from one primarily used for storage to one that can house a separate business (ZHB Finding of Fact 16). No evidence was presented before the ZHB that the accessory building had ever been used for any purpose other than storage. (ZHB Finding of Fact 17).
South Lebanon Township (hereafter TOWNSHIP) expressed concern about the project proposed by APPELLANT. Those concerns included the following:
• An increase in traffic along Lincoln Avenue;
• Using the property for self-storage would “create a problem with people using the PREMISES at all hours of the day and night on every day of the week”;
• Transforming the accessory building into a business building would unduly expand the scope of the commercial project beyond what had previously existed.
Based upon all of the testimony and evidence presented, the ZHB denied APPELLANT’s request to transform the accessory building into one that could be used for commercial purposes. However, the ZHB did authorize the main building for limited commercial use. Specifically, the ZHB rendered the following finding:
“21. The South Lebanon Township Zoning Hearing Board finds that allowing for up to three (3) clearly defined retail and commercial uses on the premises would be equally to or more appropriate than the prior uses on the premises and will be appropriate consistent with the requirements of the South Lebanon Township Zoning Ordinance and with the spirit of the ordinance.”
Consistent with this finding, the ZHB voted to approve development of the main building “to allow up to three tenants/uses upon the premises”. The ZHB then proceeded to specify approved uses as:
(a) Personal service shops including barber shops, beauty shops, salons, spas, tailors and shoe repair;
(b) Medical and dental clinics and laboratories;
(c) Banks, savings and loan associations, finance agencies, and other offices providing business or professional services;
(d) Restaurant facilities of all types including coffee shops, cafes, sandwich shops, etc.” (ZHB Decision at page 9)
The Board also voted to permit the accessory building to be used for storage and other “use accessory” to a permitted use within the main building.
APPELLANT filed a timely appeal from the decision of the ZHB. APELLANT has proffered various arguments in support of its appeal. They include the following:
(1)That the ZHB decision was not based upon “substantive evidence” but was rather predicated upon “speculative concerns”;
(2)That the ZHB decision to permit various “uses” and then limit APPELLANTS to choosing only three is arbitrary and unreasonable;
(3)That the ZHB decision is contradictory and ambiguous.
In response, the TOWNSHIP has basically responded by saying “Under Pennsylvania Law, we can basically do whatever we want to limit uses that do not conform to the applicable Zoning Code.” The issue is now before us for disposition.
In this case, we did not receive any additional evidence via a Factual Hearing. Because of this, our role is to determine whether the Zoning Hearing Board committed a manifest abuse of discretion or an error of law. Swemley v. Zoning Hearing Board of Windsor Township, 698 A.2d 160 (Pa. Cmwlth. 1997); Yost v. Zoning Hearing Board of Canonsburg, 694 A.2d 384 (Pa. Cmwlth. 1997). An abuse of discretion can be found to exist only when the Board’s findings are not supported by “substantial evidence in the record”. Township of Exeter v. Zoning Hearing Board of Exeter Township, 962 A.2d 653 (Pa. 2009). The term “substantial evidence” means information that would be sufficient to enable a “reasonable mind” to support the conclusion rendered. Valley View Civic Association v. Zoning Hearing Board of Adjustment, 462 A.2d 637 (Pa. 1983); Oxford Corp. v. Zoning Hearing Board of Oxford, 34 A.3d 286 (Pa. Cmwlth. 2011).
The extent to which our scope of review is limited is illustrated in the case of Lower Allen Citizens Core Group v. Lower Allen Township Zoning Hearing Board, 500 A.2d 1253 (Pa. Cmwlth. 1985). Lower Allen Township involved a proposed expansion of an existing quarry. The Commonwealth Court noted that there was an “impressive amount of evidence” that was “contrary to the Board’s findings”. Nevertheless, the Commonwealth Court held “That, in and of itself, does not mean that the Board’s findings are unsupported by substantial evidence.” Id at page 1258. The Court reasoned:
“It is, after all, the sole function of the Board, in performance of its role as fact finder, to evaluate witness credibility and assign evidentiary weight. In that the Board has the power to reject even uncontradictory testimony if it finds it lacking in credibility, the Board does not abuse its discretion by choosing to believe the opinion of one expert or witness over that offered by another. We likewise find that there was no capricious disregard of any competent evidence by the Board in making its findings. We have previously defined a “capricious disregard of competent evidence” to be a disbelief of testimony which someone of ordinary intelligence could not possibly challenge or entertain the slightest doubt as to its truth. The challenger’s evidence clearly does not fall into that category and the Board did not capriciously disregard that evidence when it chose to assign greater weight to [contrary evidence]. Accordingly, since the Board’s findings are supported by substantial evidence contained in the record, they are binding upon this Court.” Id at page 1258.
We have been clearly instructed by our Appellate Courts that we cannot substitute our own judgment for that of the Zoning Hearing Board. Vanguard Cellular System v. Zoning Board of Smithfield Township, 568 A.2d 703 (Pa. Cmwlth. 1989). As our Commonwealth Court has recently stated: “It is not the place of the Courts to substitute their judgment for the reasonable determination of the Zoning Board responsible for passing the relevant regulation.” Smith v. Hanover Zoning Hearing Board, 78 A.3d 1212 (Pa. Cmwlth. 2013).
As noted in the preamble to this Opinion, this Court is of the opinion that the limitations imposed on APPELLANT’s project by the ZHB are unduly restrictive. The APPELLANTS have transformed a structure that was an eyesore into an attractive commercial property and the economic viability of their project should be encouraged and not discouraged. Nevertheless, as outlined above, it is not the role of this Court to substitute its judgment for that of the Zoning Hearing Board. We are limited to determining whether “substantial evidence” supports the ZHB’s findings.
The primary evidence supporting the ZHB’s decision to limit the scope of APPELLANT’s project was presented by James Loser. 2 Mr. Loser serves as the Manager for South Lebanon Township. (N.T. 52). Mr. Loser explained that the Township was concerned about use of the structure as a self-storage facility “would create a traffic problem along Lincoln Avenue if individuals would be pulling utility trailers and so forth because of the terrain along Lincoln Avenue is quite hilly at certain areas as well as noise that could be created by individuals bringing things to the storage facility at all hours of the night because the area is surrounded by many single family dwelling units as well as Parkside Townhomes to the south.” (N.T. 53-54) In addition, Mr. Loser stated that the amount of traffic generated by the property had historically been minimal. (N.T. 54) He was concerned that the number of uses would increase traffic and accompanying noise. (N.T. 54-55).
On cross-examination, Mr. Loser stated that he had no objection to any use proposed by APPELLANTS other than the amusement and self-storage proposed uses. (N.T. 57). In response to a direct question submitted by one of the members of the ZHB, Mr. Loser provided the following testimony:
“Mr. Levengood: I have a question for Jim. I just want to-I am confused about one thing. Is the township worried about the uses or the number of tenants or is it both?
Mr. Loser: The number of uses is what we are concerned about.
Mr. Levengood: Ok. So from the list they proposed, we have eight and you are saying definitely not the indoor amusement facility and definitely not the self-storage, that’s the Township’s position?’
Mr. Loser: Right. Correct.” (N.T. 63) (emphasis added)
In addition to Mr. Loser, several neighbors also provided testimony. Brian Auman emphasized that he was not opposed to a commercial use of the PREMISES, provided that the use would not facilitate noise at night. (N.T. 65-68). John Poff testified that he supported APPELLANT’s desire to repair and renovate the building. However, he also expressed a concern about noise and traffic. He stated to APPELLANTS:
“And like I said, I am not opposed to you guys developing the building; but from what I see, you are trying to put ten pounds of potatoes into a five pound bag, and that’s my concern.” (N.T. 71)

Mr. Poff concluded his comments by indicating that he was concerned with the number of potential retail uses for the property.
In rendering its decision on the night of the hearing, the ZHB relied primarily upon concerns about traffic. (N.T. 77). The subsequent written opinion of the ZHB is somewhat less clear about the reasoning for the Board’s decision. However, traffic was at least mentioned as a reason to reject self-storage as a proposed use of the property. (ZHB decision at page 7)
Based upon the totality of the record, we cannot declare the ZHB’s decision to limit the scope of APPELLANT’s project to be an abuse of discretion. Given Mr. Loser’s testimony about the topography of Lincoln Avenue, given the concerns he expressed about increased traffic flow stemming from a commercial expansion of the PREMISES, and given the comments of the two neighbors who testified at the zoning hearing, we conclude that there was “substantial evidence” to support the ZHB’s decision to limit the scope of the project proposed by APPELLANT.
More troubling is the question of whether the ZHB’s decision should be construed to limit the number of uses or the number of tenants. Despite the effort of the ZHB opinion to link the two terms together, they are not synonymous. The term “use” refers to the type of a business located within the PREMISES. The term “tenant” refers to the number of lessees. For example, a structure could contain five different offices for doctors and yet be said to possess only one use – that of a professional medical building. Conversely, a building could have only one tenant but could be said to house multiple “uses” if the tenant simultaneously operates a book store, a coffee shop and a print shop.
The problem we have with this case is that the record is not entirely clear about whether the TOWNSHIP wished to limit the number of uses or the number of tenants for the property.
On the one hand, the ZHB’s solicitor was very careful on the night of the ZHB’s decision to inquire about whether the ZHB was limiting the number of tenants. Before a final vote was taken, the following exchange occurred:
“Mr. Sheffey: Now, before we take anything, when we say tenants, lets’ talk about that. Are you saying that there could be, for instance, three coffee shops and even though that’s only one of the allowed uses, that would be three tenants and that would be the maximum number of tenants that could be on the property? When you say tenants, is that what you are meaning?
Mr. Levengood: Yes.
The Chairman: Yes.
Mr. Chernich: Yes.” (N.T. 79)
Unfortunately, the ZHB’s formal written decision is less clear. Finding of Fact 21 states that the ZHB “finds that allowing for up to three clearly defined retail and commercial uses on the property would be equally (sic) to or more appropriate than the prior uses on the premises…” Moreover, the decision itself states that APPELLANTS will be permitted “to allow up to three tenants/uses upon the premises.” The decision then goes to approve four categories of uses that would be deemed “equally appropriate or more appropriate in the medium density residential district than the Ace Aluminum non-conforming use including the use by Hockley Glass & Mirror.”
As we dug deeper into the record of this case in an effort to determine whether there was “substantial evidence” to limit the number of tenants or the number of uses to three, we noted the following testimony from Township Manager Loser:
“Mr. Levengood: I have a question for Jim. I just want to – I am confused about one thing. Is the Township worried about the uses or the number of tenants or is it both?
Mr. Loser: The number of uses is what we are concerned about.” (N.T. 63)
We were further confused by the TOWNSHIP’s legal brief. When discussing APPELLANT’s argument that the ZHB could not limit the number of tenants, the TOWNSHIP stated:
“A reading of the decision makes it clear the ZHB has imposed a limitation on the number of uses. Appellant may have up to three distinct operations on the subject property. It is not up to the ZHB to determine how Appellant reaches that limit. Of course, in response to Appellant it is difficult to imagine how it is possible to have more than three tenants with a three use limitation. Appellant’s attempt to focus on the word “tenant” is nothing more than a distraction.” (The TOWNSHIP’s Brief at pages 9-10)
With all due respect to the TOWNSHIP, it is certainly possible to populate a structure with more than three tenants who employ less than three uses. For example, it would be possible for five different lawyers to establish an office inside the PREMISES. This would create five separate landlord-tenant relationships, but it would only constitute one use, i.e., law office. To the extent that either the TOWNSHIP or the ZHB wishes to conflate the terms “tenant” and “use”, we reject such an effort.
It certainly appears based upon Attorney Sheffey’s comments and questions on the date of the hearing that the ZHB intended to limit the number of tenants because it perceived that was what the TOWNSHIP and neighbors wanted. However, it is far less clear that the TOWNSHIP – or the neighbors – wanted to limit the number of tenants. In fact, based upon the transcript, we highly doubt that either the TOWNSHIP or the neighbors would oppose five professional offices for which there would be established hours and limited traffic. The concerns expressed at the hearing were targeted against businesses such as the nearby Turkey Hill Minit Market that would generate an influx of traffic, especially vehicular traffic that would be exiting or entering Lincoln Avenue.
Based upon the entirety of the record, we will be affirming the decision of the ZHB to limit the scope of APPELLANT’s project. However, we will be remanding this case back to the ZHB for further proceedings designed to clarify the nature and extent of those limitations. Specifically, we will ask the ZHB to delineate whether its limitation pertains to use or tenancy or both. If the ZHB determines that it is necessary to receive additional factual evidence in order to accomplish this task, it shall be at liberty to schedule a hearing in order to receive that additional information.
As the ZHB continues to undertake its function on remand, we encourage all parties to continue a dialog about settlement. We cannot help but think that there has to be a way to address the TOWNSHIP’s legitimate concerns about traffic without endangering the economic viability of APPELLANT’s project.
An Order to effectuate the decision we have reached today will be entered simultaneous with this Opinion.

1 Of course, there are exceptions to this general precept. The government certainly has an interest in making sure that landowners do not use their properties in a manner that adversely affects neighbors or the community at large. With that being acknowledged, we affirm our belief that landowners should have broad discretion in deciding how to use their own property in a non-harmful manner.

2 For thirty-eight years prior to his appointment as Manager, Mr. Loser served as Assistant Manager. (N.T. 38)

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