Com. v. Thomas, M.

J-S70045-16

NON-PRECEDENTIAL DECISION - SEE SUPERIOR COURT I.O.P. 65.37

HOWARD E. COHEN AND EILEEN C. : IN THE SUPERIOR COURT OF

COHEN, Husband and Wife, : PENNSYLVANIA

:

Appellants :

:

v. :

:

LONG & FOSTER REAL ESTATE, INC., : No. 698 EDA 2016

Appeal from the Judgment entered March 31, 2016

in the Court of Common Pleas of Delaware County,

Civil Division, No(s): 2014-9715

BEFORE: OLSON, OTT and MUSMANNO, JJ.

MEMORANDUM BY MUSMANNO, J.: FILED NOVEMBER 23, 2016

Howard E. Cohen and Eileen C. Cohen (collectively, “the Cohens”),

husband and wife, appeal from the Judgment entered against them and in

favor of their real estate broker, Long & Foster Real Estate, Inc. (“L&F”), in

this action brought pursuant to Pennsylvania’s Unfair Trade Practices and

Consumer Protection Law (“UTPCPL”).1 We affirm.

In its Opinion, the trial court set forth the factual and procedural

history underlying the instant appeal, which we incorporate herein by

reference. See Trial Court Opinion, 4/29/16, at 1-5.

Following a bench trial, the trial court entered a verdict in favor of L&F

and against the Cohens. The Cohens filed post-trial Motions, which the trial

court denied. On February 16, 2016, the trial court denied the Cohens’ post-

trial Motions, after which the Cohens filed a Notice of Appeal, followed by a

1

73 P.S. § 201-1 et seq.

J-S70045-16

court-ordered Pa.R.A.P. 1925(b) Concise Statement of matters complained

of on appeal. On March 31, 2016, the trial court entered judgment.

Accordingly, we may consider the issue presented by the Cohens in this

appeal. See Commonwealth v. Cooper, 27 A.3d 994, 1008 (Pa. 2011)

(stating that “[a] notice of appeal filed after the announcement of a

determination but before the entry of an appealable order shall be treated as

filed after such entry and on the date thereof.”) (citation omitted).

The Cohens present the following claim for our review:

Did the [trial] court commit legal error and/or abuse its

discretion by entering a [v]erdict in favor of [L&F] and against

[the Cohens], based solely on the [trial] court’s stated rejection

of [the Cohens’] credible, unimpeached, uncontroverted and

unrebutted expert testimony regarding the unreasonable conduct

by the sales agent of [L&F] in underestimating the future

settlement costs and monthly carrying charges, specifically[,]

the ongoing real estate taxes, beginning from the date of a

future settlement on a to-be-constructed new home?

Brief for Appellants at 2-3.

The Cohens argue that the testimony of their expert, Donald Weiss

(“Weiss”), confirmed that, pursuant to 49 Pa. Code. § 35.334, it is a real

estate broker’s duty to provide the buyer with a statement of estimated

settlement and carrying costs. Brief for Appellants at 14. The Cohens assert

that pursuant to subsection 35.334(a), before an agreement of sale is

executed, the broker is required to provide each party with a written

estimate of reasonably foreseeable expenses that the party can be expected

-2-

J-S70045-16

to pay, including but not limited to taxes and assessments. Id. According

to the Cohens, Weiss testified that

a knowledgeable and experienced sales broker should have

known in February 2010 that taxes go up annually, that the

common level ratio increases in July prior to the next calendar

year to which it would apply, that the school taxes increase as of

July 1 of each year, that the other township and county taxes

increase as of January 1 of each year, and that the taxes had

increased by 9% from 2009 to 2010....

Id. at 16. The Cohens argue that L&F should have projected this same 9%

increase factor when it made forward-looking estimates of settlement costs

and monthly carrying charges, including future real estate taxes. Id. The

Cohens assert that, based upon the evidence presented by Weiss, and L&F’s

failure to counter this evidence, the trial court abused its discretion in not

crediting Weiss’s testimony. Id. at 17. The Cohens claim that L&F’s conduct

“deprived [them] of the fundamental fairness of having the material

information to which they were entitled in order to make their purchase

decision.” Id. They further argue that they relied upon this “deceptive and

misleading” information, and that the verdict should be reversed. Id.

As this appeal arises from a non-jury trial, we observe that

with regard to factual determinations, the trial court acts as the

factfinder in a bench trial and may believe all, part or none of

the evidence presented. Issues of credibility and conflicts in

evidence are for the trial court to resolve; this Court is not

permitted to reexamine the weight and credibility determinations

or substitute our judgment for that of the factfinder.

Furthermore, the findings of the judge in a non-jury trial are

given the same weight and effect as a jury verdict such that the

court’s findings will not be disturbed on appeal absent an abuse

of discretion, error of law, or lack of support in the record. We

-3-

J-S70045-16

will not disturb the court’s factual findings merely on the basis

we would have reached a different conclusion; rather, our task is

to “determine whether there is competent evidence in the record

that a judicial mind could reasonably have determined to support

the finding.

Ruthrauff, Inc. v. Ravin, Inc., 914 A.2d 880, 888 (Pa. Super. 2006)

(internal quotation marks and citations omitted). “Conclusions of law,

however, are not binding on an appellate court[,] whose duty it is to

determine whether there was a proper application of law to fact by the lower

court. On pure questions of law, … our review is plenary.” Kohl v. PNC

Bank Nat’l Ass’n, 912 A.2d 237, 248 n.16 (Pa. 2006) (internal quotation

marks and citation omitted).

In its Opinion, the trial court addressed this claim, and determined

that it is without merit. See Trial Court Opinion, 4/29/16, at 11-15, 17-18.

We agree with the sound reasoning of the trial court, as set forth in its

Opinion, and affirm on this basis. See id.

Judgment affirmed.

Judgment Entered.

Joseph D. Seletyn, Esq.

Prothonotary

Date: 11/23/2016

-4-

Circulated 10/31/2016 03:41 PM

IN THE COURT OF COMMON PLEAS OF DELAWARE COUNTY, PENNSYLVANIA

CIVIL DIVISION

HOWARD E. COHEN : NO. 14-009715

and

EILEEN COHEN h/w

v.

LONG & FOSTER REAL ESTATE, INC.

HONORABLE CHRISTINE FIZZANO CANNON FILED: April 29, 2016

OPINION

After a non-jury trial conducted on December 9, 2015, this Court entered an

Order/Verdict, on December 21, 2015, finding in favor of Defendant, Long & Foster Real

Estate, Inc. (hereinafter "Defendant") and against Plaintiffs, Howard E. Cohen and

Eileen Cohen, husband and wife (hereinafter "Plaintiffs"). On February 16, 2016, after

argument, this Court denied Plaintiffs' Motion for Post-Trial Relief. Plaintiffs filed an

appeal on March 2, 2016.

Plaintiffs purchased 245 Valley Ridge Road, Haverford Township, Delaware

County, Pennsylvania 19041 (hereinafter "the subject property"), on January 10, 2011,

for the sum of $1,113,444.04. Plaintiffs' Amended Complaint, filed December 10, 2014,

1118. The subject property was a newly constructed residential home within the

Haverford Reserve project. Id. at ,i 13. Defendant, Long & Foster Real Estate, Inc. was

1

the listing broker for the builder/developer of the Haverford Reserve project. Id. at~

12. Notes of Testimony, p. 67. The agreement of sale between the Plaintiffs and

Haverford Reserve, L.P. was fully executed on March 3, 2010. Exhibit D-5. Prior to

execution of the sales agreement, Plaintiffs met with Jeannine M. Carleton, the sales

manager for the Haverford Reserve project and a licensed real estate salesperson

employed by Defendant. Plaintiffs' Amended Complaint,~~ 7 and 8; Notes of

Testimony, p. ~8. On February 13, 2010, Ms. Carleton submitted to the Plaintiffs a

written Buyer Settlement Cost Estimate, that she prepared, which contained information

that the estimate for county, township and school district real estate property taxes for

the property would amount to $17,719.33 annually. Plaintiffs' Amended Complaint,~

15; Exhibit P-2; Notes of Testimony, p. 15-16. Plaintiffs claimed that the Defendant's

agent, Ms. Carleton, made verbal representations that the real estate taxes for the

property would be about 2 percent of the sales price. Notes of Testimony, p. 13. The

Buyer Cost Estimate Sheet indicated that the property taxes were estimated to be 2.08

percent of the then-believed sale price of $850,000. Plaintiffs' Amended Complaint,~

15; Notes of Testimony, p. 13, 17 and 35. Ms. Carleton testified that while she did not

recall making any verbal representations regarding real estate taxes, if she made any

representations, she would have told Plaintiffs that their taxes would be approximately

2.1 percent of the sales price. Notes of Testimony, p. 85 and 92. She also stated that

she told the Plaintiffs that they should "check with the township". Notes of Testimony,

p. 92. The Plaintiffs never verified the tax information. Notes of Testimony, p. 19.

2

The Plaintiffs signed the Agreement of Sale, on March 3, 2010, three weeks after

they received the Buyer Settlement Cost Estimate. Notes of Testimony, p. 36. Due to

an increased sale price caused by construction extras and upgrades, the Plaintiff,

Howard Cohen, testified that he expected that their annual real estate taxes would

amount to $23,382.32, based on the projected 2.1 percent of sales price tax estimate,

as the final sales price was $1,113,444.04. Plaintiffs' Complaint, 19; Notes of

Testimony p. 23 and 40-41. The title company that handled the settlement on the

subject property estimated the taxes to be $24,500.00, on the HUD-1 settlement sheet,

a difference of $1,118.00 more than the Plaintiffs' expectation based on the Buyer

Settlement Cost Estimate. Exhibit P-2; Exhibit P-4; Notes of Testimony, p. 42. After

multiple tax assessment appeals, the annual taxes for 2014 amounted to $26,500.00,

$3,117.68 a year higher than the Defendant's original 2010 estimate, or 2.38 percent of

the final sales price. Plaintiffs' Amended Complaint, ~23; Notes of Testimony, p. 26.

At the non-jury trial, Plaintiff, Howard E. Cohen, testified on his own behalf and

reviewed his experience purchasing the subject property, the contract for sale,

settlement, and the subsequent real estate tax proceedings. Notes of Testimony, pp. 8-

63. Plaintiff called Jeannine Carleton, as of cross examination, who reviewed her efforts

as the sales manager at the Haverford Reserve project. Notes of Testimony, pp. 63-

100. Finally, Plaintiff called Donald J. Weiss, Esquire, an expert qualified by the Court

to testify as a licensed real estate broker. Notes of Testimony, pp. 112-154.

3

Defendant presented the testimony of Andrea Baptiste, the managing broker of

the Long & Foster office location in Doylestown, Pennsylvania, and Janice Robinson, a

sales and administrative support assistant at the Haverford Reserve project for the

Goldenberg Group. Notes of Testimony, pp. 159-167 and 169-180.

Plaintiff introduced and admitted into the record at trial: certain pleadings (P-1);

the Buyer Settlement Cost Estimate (P-2); the agreement of sale, dated March 3, 2010

(P-3); the HUD-1 Settlement Statement (P-4); selected provisions of the Pennsylvania

Real Estate Agent Professional Conduct Regulations under the Pennsylvania Real Estate

Licensing and Registration Act, 63 P.S. §455.101 et. seq., (P-5); historical property real

estate assessments for the Haverford Reserve project (P-6); historic common level

ratios, tax rate tables, bond market yields, and a portion of Modern Real Estate Practice

in PA (P-7); Plaintiffs' statement of attorney's fees (P-8); a Summary of Plaintiffs'

Compensatory Damage Calculations by Donald Weiss, Esquire, (P-9); and the

deposition transcript of Jeannine Carleton (P-10). See Plaintiffs Exhibit P-1 through P-

10.

The Defendant introduced and admitted into evidence: the agreement of sale (D-

5); the HUD-1 Settlement Statement (D-9); the Public Offering Statement for the

Haverford Reserve (D-6); the Buyer Settlement Cost Estimate (D-8), Plaintiffs' Response

to Defendant's Request for Production of Documents (D-10); and an Options List for the

subject property (D-12). See Defendant's Exhibits D-5, D-6, D-8, D-10 and D-12.

4

Plaintiffs' Amended Complaint did not include claims for negligence, negligent

misrepresentation, breach of contract, or fraud, but rather, the Amended Complaint

contained only one count, for claimed violation of Pennsylvania's Unfair Trade Practices

and Consumer Protection Law, 73 P.S. §201-1 et. seq. (hereinafter "UTPCPL"). See

Plaintiffs' Amended Complaint,~~ 26-63. Plaintiffs' Amended Complaint sought relief

under subsections 201-2(4)(v) and (xxi) of the Act. At trial, Plaintiffs also sought relief

under section 201-2(4)(ii).

The UTPCPL prohibits "Unfair methods of competition" and "unfair or deceptive

acts or practices" as follows, in relevant part:

(4) "Unfair methods of competition" and "unfair or deceptive acts or practices"

mean any one or more of the following: ...

(ii) Causing likelihood of confusion or of misunderstanding as to the

source, sponsorship, approval or certification of goods or services; ...

(v) Representing that goods or services have sponsorship, approval,

characteristics, ingredients, uses, benefits or quantities that they do not

have or that a person has a sponsorship, approval, status, affiliation or

connection that he does not have; ...

(xxi) Engaging in any other fraudulent or deceptive conduct which creates

likelihood of confusion or of misunderstanding.

73 P.S. Section 201-1 and 201-2(4)(ii), (v) and (xxl).

After submission of post-trial memoranda, this Court entered its Verdict/Order on

December 21, 2015 finding in favor of the Defendant and against Plaintiffs.

Plaintiffs complain on appeal as follows:

1. This Honorable Court committed error of law or abused its discretion, if and

to the extent that its verdict was based on a ruling that the parol evidence

5

rule or contract integration clause barred Plaintiffs' PA Unfair Trade Practices

and Consumer Protection Law ("UTPCPL'') claim against Defendant.

2. This Honorable Court committed error of law or abused its discretion, if and

to the extent that its verdict was based on a ruling that Plaintiffs' UTPCPL

claim required proof of an intentional action by Defendant.

3. This Honorable Court committed error of Jaw or abused its discretion, if and

to the extent that its verdict was based on a ruling that there was insufficient

evidence of liability as to Plaintiffs' UTPCPL claim against Defendant.

4. This· Honorable-co.urt-commTttederrorof law or abused its discretion, if and

to the extent that its verdict was based on a ruling that there was insufficient

evidence of damages as to Plaintiffs' UTPCPL claim against Defendant.

5. This Honorable Court committed error of law or abused its discretion, if and

to the extent that its verdict was based on a ruling that Plaintiffs allegedly

misrepresented their actual purchase price for the subject real estate in any

manner, or otherwise allegedly violated any section of the Real Estate

Settlement Procedures Act, and/or the Pennsylvania real estate transfer tax

laws.

6. This Honorable Court committed error of law or abused its discretion, if and

to the extent that its verdict was based on a rulinq which considered any

matter other than the differential between (a) the proportionate annualized

real estate taxes which Defendants actually had estimated for Plaintiffs at the

time before Plaintiffs had committed to purchase the home, and (b) the

proportionate annualized real estate taxes which Defendant should have been

able to estimate at the time before Plaintiffs had committed to purchase the

home, using publicly available information.

7. · This Honorable Court committed error of law or abused its discretion, if and

to the extent that its verdict was based on a ruling that any portion of the

testimony proffered by any of Defendant's fact witnesses was accepted as

expert testimony.

8. This Honorable Court committed error qf law or abused its discretion, if and

to the extent that its verdict was based on a ruling that any portion of the

unrebutted testimony proffered by any of Plaintiffs' fact and expert witnesses

was deemed not credible.

Plaintiff's Concise Statement of Errors and/or Rulings Complained of an Appeal, filed

March 23, 2016.

6

First, this Court addresses the Plaintiffs' complaint that this Court erred if it based

its decision on a ruling that the parol evidence or contract integration clause barred

Plaintiffs' UTPCPL claim against the Defendant. This Court did not exclude any

testimony or exhibits due to application of the parol evidence rule.

Next, the Plaintiffs complain on appeal that this Court erred if it based its

decision on a ruling that Plaintiffs' UTPCPL claim required proof of an intentional action

by Defendant. This Court did not make such a ruling and did not require proof of

intentional wrongdoing.

The UTPCPL is Pennsylvania's consumer protection law and seeks to prevent

"[u]nfair methods of competition and unfair or deceptive acts or practices in the

conduct of any trade or commerce ... " The purpose of the UTPCPL is to protect

the public from unfair or deceptive business practices. Our Supreme Court has

stated courts should liberally construe the UTPCPL in order to affect the

legislative goal of consumer protection. DeArmitt v. New York Life Ins. Co., 73

A.2d 578, 591 (Pa. Super. 2013).

The UTPCPL provides a private right of action for anyone who "suffers any

ascertainable loss of money or property" as a result of "an unlawful

method, act or practice". Upon a finding of liability, the court has the

discretion to award "up to three times the actual damages" and provide

any additional relief the court deems proper. Section 201-2( 4) lists twenty

enumerated practices which constitute actionable "unfair methods of

competition" or "unfair or deceptive acts of practices." The UTPCPL also

contains a catchall provision at 73 P.S. 201-2(4)(xxi). The pre-1996

catchall provision prohibited "fraudulent conduct" that created a likelihood

of confusion or misunderstanding. In 1996, the General Assembly

amended the UTPCPL and revised Section 201-2(4)(xxi) to add "deceptive

conduct" as a prohibited practice. The current catchall provision proscribes

"fraudulent or deceptive conduct which creates the likelihood of confusion

or of misunderstanding."

7

Id. at 591-592 (citing Bennett v. A.T. Masterpiece Homes at Broadsprings, 40

A.3d 145, 151-52 (Pa. Super. 2012) (internal citations omitted)). See also Agliori

v. Metropolitan Life Ins. Co., 879 A.2d 315, 318 (Pa. Super. 2005).

In order for a private individual to bring a private claim under Unfair Trade

Practice and Consumer Protection Law (UTPCPL), that individual must first

establish that he or she is a purchaser or lessee, that the transaction is dealing

with goods or services, that the good or service was primarily for personal,

family, or household purposes, and that he or she suffered damages arising from

the purchase or lease of goods or services; to prevail, the individual must

then prove that the defendant was engaged in unfair methods of

competition and unfair or deceptive acts or practices and that the

transaction constituted trade or commerce within the meaning of the UTPCPL.

Fazio v. Guardian Life Ins. Co. Of America, 62 A.3d 396. hn 3 (Pa. Super.

2012)(citing73 P.S. § 201-1)) (emphasis added).

. . . the UTPCPL plaintiff must still prove justifiablereliance and

causation, because the legislature "never intended [the] statutory language

directed against consumer fraud to do away with the traditional common law

elements of reliance and causation." DeArmitt v. New York Life Ins. Co., 73 A.2d

at 592. (citing Toy v. Metropolitan Life Insurance Company, 928 A.2d 186, 202)

(emphasis added).

Plaintiffs claim that the Defendant violated the UTPCPL by:

... (ii) Causing likelihood of confusion or of misunderstanding as to the

source, sponsorship, approval or certification of goods or services; ... 73

P.S. Section 201-1 and 201-2(4)(ii)

Plaintiffs did not establish that the Defendant's caused likelihood of confusion or of

misunderstanding as to the source, sponsorship, approval or certification of goods or

services. In fact, there is no evidence of record regarding the source, sponsorship,

approval or certification of the subject property.

Plaintiffs further claim that the Defendant violated the UTPCPL by:

... (v) Representing that goods or services have sponsorship, approval,

characteristics, ingredients, uses, benefits or quantities that they do not have or

8

that a person has a sponsorship, approval, status, affiliation or connection that

he does not have; ...

73 P.S. Section 201-1 and 201-2(4) (v).

Plaintiffs, however, failed to meet their burden of proof to establish a violation of this

section.

Specifically, the Plaintiffs complain that the real estate agent's alleged verbal

representations, that the estimated real property taxes on the subject property would

be about2.0 percent, and/or the written estimate, that the real estate taxes would be

about 2.1 percent of the purchase price, were representations of a characteristic that

the subject property did not have. However, the real estate agent, Ms. Carleton,

testified credibly that any verbal representations that she may have made to Plaintiffs

about real estate taxes, although she did not recollect any, would have included the

word approximately. Notes of Testimony, pp. 85 and 92. In fact, Plaintiff, Howard

Cohen, asserted that she stated that the real estate taxes would be about 2 percent of

the sale price. Notes of Testimony, p. 13. In addition, the record makes clear that the

Buyer Settlement Cost Estimate provides that the estimated real estate taxes would be

about 2.1 percent of the purchase price, or $17,719.33, only $5.33 less than the

Plaintiffs' own expert testified his calculations would have concluded, if providing an

estimate at the same time.1 See discussion, infra, pp. 11 - 15. Exhibit P-2. In addition,

1

The Plaintiffs' expert testified that his calculation would have resulted in an estimate of $17, 714.00 for February

2010. See Notes ofTestimony, pp. 140-142. The expert opined that to determine taxes, you should first determine

what the common level ratio factor is, then multiply the value of the property (in this case the sales price) by the

common level ratio factor (to come up with an assessment} and then multiply the assessment by the millage.

Notes ofTestimony, p. 116.

9

the real estate taxes escrowed by the title company reflected an annual amount of

$24,500.00 in January 2011, and the actual real estate taxes in 2014 (four years after

the estimate was provided and three years after settlement) were set at 2.38 percent of

the total purchase price, $26,500.00. Notes of Testimony, pp. 31-31; Plaintiff's

Amended Complaint, ,i23. This Court finds that the alleged misrepresentation of a

characteristic of the property made by Defendant's agent of the estimated real estate

taxes in 2010 was not a misrepresentation at all and there was no likelihood of

confusion or misunderstanding. See discussion, infra, pp. 11-15.

Furthermore, the Plaintiffs in this matter argue that the Defendant is liable

pursuant to the "catch-all provision" of the Unfair Trade Practices and Consumer

Protection Law ("UTPCPL") that provides: "(xxi) engaging in any other fraudulent or

deceptive conduct which creates a likelihood of confusion or of misunderstanding." 73

P.S. Section 201-2(4)(xxi). "In Bennett v. A.T. Masterpiece Homes at Broadsprings,

LLC, 40 A.3d 145 (Pa. Super. 2012), the [Pennsylvania Superior Court] panel concluded

that a 1996 ... amendment to the catch-all provision that added the language "or

deceptive conduct" changed the requirement from proving actual fraud to merely

proving deceptive conduct". Milliken v. Jacono, 60 A.3d 133 (Pa. Super 2012) (citing

Bennett v. A.T. Masterpiece Homes at Broadsprings. LLC, 40 A.3d 145, 150-153 (Pa.

Super. 2012)). The Pennsylvania Superior Court has held that '"misleading conduct'

could be a catch[-]all violation." Bennett at 155.

10

Even with this lowered burden, the buyers in the instant case did not prove their

claim for violation of the UTPCPL as the Plaintiffs failed to provide any evidence that the

Defendant engaged in deceptive or misleading conduct. The Plaintiffs in this case made

a calculation of an estimate of settlement costs that included a figure for estimated real

estate taxes that was only $5.33 different than that which the Plaintiffs' expert

calculations would have established. See Notes of Testimony, pp. 140-141. There was

simply no evidence of deceptive conduct or misleading conduct.

Third, the Plaintiffs complain on appeal that this Court erred in finding that there

was insufficient evidence of Defendant's violation of the UTPCPL. This Court did, in

fact, conclude that the Plaintiffs did not establish any violation of the UTPCPL by

Defendant, and, in addition to that noted above, this Court further notes:

By using the formula proposed by the Plaintiffs' expert, by the expert's own

admission on cross-examination, the Defendant's calculation at the time it was made,

February, 2010, should have been $17,714.00. Notes of Testimony, pp. 140-141.

Again, what Defendant did estimate was $17,719.33, a difference of $5.33. Id.

Plaintiffs' expert actually states that the estimate provided to the Plaintiffs on February

17, 2010 was the correct calculation. Id., p. 137 and 141. Plaintiffs' expert, however,

criticized the Defendant for providing the estimate for February 2010, when the

settlement did not take place until January 2011. Id. at p. 141. However, Plaintiffs'

expert admitted that a real estate agent or broker must provide the estimate at or

before the Agreement of Sale is executed in accordance with 49 Pa. Code 35.334. Id. at

11

142. The Agreement of Sale in this matter was signed on March 3, 2010. Exhibit D-5.

Title 49, Section 35.334 of the Pennsylvania Code provides that a real estate agent is

required to provide an estimate of closing costs before an Agreement of Sale is

executed. 49 Pa. Code 35.334 (a) (emphasis added); Notes of Testimony, p. 142.

This section further provides that the estimate provided "shall be as accurate as may be

reasonably expected of a person having knowledge of, and experience in, real estate

sales." 49 Pa. Code 35-334(b). The Plaintiffs' expert claimed that Ms. Carleton should

have known that her estimate would not accurately reflect the estimate of taxes for the

subject property because she provided the number for February 2010 instead of the

number when the settlement was expected to take place, after the annual change in

common level ratio factor would have been published. Notes of Testimony, pp. 129-

130, p. 143. This argument is without merit.

Plaintiffs' expert testified that a reason that the Plaintiffs "got wacked" on their

real estate taxes was because the common level ratio factor changed after they signed

the Agreement of Sale and before settlement. Notes of Testimony, p. 135. However,

this Court finds that Defendant's agent simply could not predict such a change. Even

the table of common level ratio factors admitted into evidence by the Plaintiffs indicated

that some years the common level ratio factor rises, some years it falls and some years

it remains the same. Exhibit P-7. The information becomes available in or about July

of a given year. Notes of Testimony, p. 117 and 132. A common level ratio factor is the

"mathematical reciprocal of the actual common level ratio". Exhibit P-7. These real

estate valuation factors are based on sales data compiled by the State Tax Equalization

12

Board". Id. Plaintiffs' expert claimed that we "all know that taxes are going up ...

school taxes ... [s]o they should have been basing iton what the millages would have

been for school taxes at the end of the year. And the CLR changes every July and so

do school taxes change every July ... [T]hey should have redone it in July." Notes of

Testimony, pp. 129-130. This Court found Ms. Carleton had to provide the estimate

before the Agreement of Sale was executed. This Court further found that is not

reasonable to expect a real estate agent with experience in real estate sales to predict

the change in school tax millage2 or the annual rise or fall in the common level ratio

factor.3 It is further unreasonable to require that the agent include that prediction in

his/her calculation of an estimate of settlement costs many months before the change,

if any, in the CLR and change in school tax millage are made public. The Buyer

Settlement Cost Estimate was required to be provided before the Agreement of Sale

was signed, redoing it in July would not have changed the Agreement that had already

been executed by the Plaintiffs. This Court rejects the expert's testimony indicating

that such a prediction and inclusion would be reasonably included in such an estimate

and rejects the conclusion that the calculation should have been redone in July, months

after the Plaintiffs have entered into the Agreement of Sale.

The agreement of sale was signed in March 2010. Exhibit D-5. Plaintiffs' expert

claimed that Defendant's agent should have projected the taxes after July 2010

2

Plaintiffs' expert testified that school tax millage is set in May and takes effect July 1 '1• Notes of Testimony, p.

117.

3

Plaintiffs' expert testified that the common level ratio factor changes in or about June or July. !Q. at p. 135.

13

because real estate tax rates and common level ratio factors would change before

settlement on the subject property. Notes of Testimony, p. 135. However, a reasonable

real estate agent with experience in real estate sales cannot be expected to predict

those changes and Plaintiffs failed to establish Defendant was required to change the

pre-agreement estimate. It must also be noted that the settlement date for this

property had been extended. Exhibit P-4; Exhibit D-5. The anticipated closing date was

in November of 2010. Exhibit D-5. The settlement took place in January 2011. There is

no evidence that anyone could have known that the settlement date would be

extended, or to what date it would be extended. However, according to Plaintiffs'

expert's theory, the real estate agent providing the estimate would reasonably be

responsible for predicting when the property settlement would take place for the

subject property or providing a new estimate every time the millage, tax rate or CLR

change. This Court does not accept this assertion and the Plaintiff did not point to any

case law, statute, rule or regulation governing real estate agents that would have

established such a requirement.

The Public Offering Statement, incorporated into the Agreement of Sale,

provided that: "The assessed value of the completed Units for real estate tax purposes

is not yet known. The assessed value of the Units may vary depending on their size,

features, and cost." Exhibit D-6. Furthermore, the Buyer Estimate Settlement Cost

sheet clearly states that the "Information herein deemed reliable but not guaranteed."

Exhibit P-2. The title of the document itself makes clear that it is an estimate. Id. The

Buyer Settlement Cost Estimate indicated that "[t]he above figures are approximate

14

settlement costs and will be adjusted as of the date of final settlement, if necessary."

Exhibit P-2. The figures were adjusted for the HUD-1 Settlement Sheet at the final

settlement. Exhibit" P-4.

Plaintiffs' expert also testified that "[e]very new property is over-assessed when

it comes out of the block" and that the subject property was over-assessed. Notes of

Testimony p. 152. An over-assessment, of course, would make the taxes higher than

anticipated. Under Plaintiffs' expert's theory, a real estate agent would also have to

guess what the over assessment might be for a given property in order to properly

estimate the real property taxes.

Fourth, Plaintiffs have claimed that this Court erred, if it based its decision upon

a finding that there was insufficient evidence of damages as to Plaintiffs' UTPCPL claim

against Defendant. This Court did not and need not address the sufficiency of evidence

of damages in this matter, as the Plaintiffs have failed to establish a violation of any

section of the UTPCPL.

Fifth, Plaintiffs complain on appeal that this Court erred if it based its decision on

a finding that the Plaintiffs misrepresented their actual purchase price for the subject

property, or that Plaintiffs violated the Real Estate Settlement Procedures Act or

Pennsylvania's real estate transfer laws. This was not a conclusion or finding that this

Court made in this matter.

15

Next, Plaintiffs also claimed on appeal that this Court erred if its decision was

based upon a finding that the testimony of Defendant's fact witnesses was expert

testimony. This Court did not consider the testimony of any of Defendant's witnesses

to be expert testimony. However, this Court did not accept Plaintiffs' expert's testimony

that the Defendant should have modified her estimate, and did not find that the

Defendant's actions, through its agent, were deceptive or misleading in any way. See

discussion, supra, pp. 11-15.

Plaintiffs also complain on appeal that this Court erred by basing its decision on

any matter other than the differential between "(a) the proportionate annualized real

estate taxes which Defendants actually had estimated for Plaintiffs at the time before

Plaintiffs had committed to purchase the home, and (b) the proportionate annualized

real estate taxes which Defendant should have been able to estimate at the time before

Plaintiffs had committed to purchase the home, using publicly available information."

Plaintiffs' Concise Statement of Errors and/or Rulings Complained of an Appeal, filed

March 23, 2016, ~ 6. This complaint by Plaintiffs on appeal seems to imply that any

deviation between the two numbers is a violation of the UTPCPL. This Court does not

accept this theory. The Defendant must prove misleading conduct and has failed to do

so. A deviation of $5.33 proves that Ms. Carleton's was a good faith and reasonable

estimate, not a deceptive act that would have constituted a violation of the UTPCPL. In

addition, it must be noted that even Plaintiff, in its Concise Statement of Matters

Complained of On Appeal, only suggests that the relevant inquiry is that figure that was

provided and that figure that should have been provided at the time before Plaintiffs'

16

committed to purchase the house, March 3, 2010. Plaintiffs' Concise Statement of

Errors and/or Rulings Complained of an Appeal, filed March 23, 2016, ~ 6. As such,

Plaintiff does not seem to be suggesting that the estimate should have been redone

after execution of the agreement of sale and this Court agrees that it was not required

to be recalculated after the CLR and school tax information became available in July

2010.

Lastly, Plaintiffs complain that this Court erred by ruling that any portion of the

testimony proffered by any of the Plaintiffs' fact and expert witnesses was deemed not

credible. The relevant facts to this Court's analysis are not in dispute. This Court

accepts that the Defendant estimated, in March 2010, that the real estate taxes for a

$850,000.00 home would be $17,719.33 at settlement and accepts that the actual real

estate taxes for a $1,113,444.04 home in this matter were $26,500 in 2014. However,

this Court finds that the Defendant made a good faith estimate as required by 49 Pa.

Code 35.334. This Court does not agree that it would have been reasonable for the

Defendant to predict the change in the common level ratio factor or the school tax

millage when making her estimate before the Agreement of Sale was signed. As such,

based on the calculations used by the Defendant's expert, the proper estimate, made in

March 2010, would have been $17,714.00. The minor difference between a $17,719.33

estimate and a $17,714.00 estimate cannot be deemed a misrepresentation, deceptive

or misleading. The representation made by the Defendant was reasonable and

accurate at the time that it was made and the Buyer Settlement Cost Estimate makes

clear to the Plaintiffs that that the figures provided are an estimate, are the

17

approximate settlement costs, and "will be adjusted as of the date of final settlement, if

necessary." Exhibit P-2 (emphasis added). The numbers were adjusted by the title

company on the HUD-1 Settlement Sheet to reflect the annual taxes to be $24,500, still

lower than the actual taxes that resulted after what Plaintiffs' own expert calls the over-

assessment of the subject property, and still lower than the amount the taxing

authorities were willing to accept in 2014, $26,500. The real estate agent could not

have been expected to predict the change in CLR, the change in school tax millage, the

change in settlement date, the over-assessment, or the amount the taxing authorities

would bewillinq to accept with exact precision and this Court finds that the estimate

that was made was made at the appropriate time, was reasonable under the

circumstances and did not constitute a deceptive or misleading act.

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