Sewer Service Mobile Home Park Enforceable Agreement Promissory Estoppel
Big Bear Mgmnt. Fund v. Lower Macungie Twp., PICS Case No. 17-1170 (C.P. Lehigh May 25, 2017) Johnson, J. (22 pages).
An agreement reached through a series of letters regarding individual billings to mobile home park tenants for sewer charges was binding on the township. Owners of the park were secondarily liable if the individual tenants failed to make payment.
Plaintiffs owned and operated a mobile home park. The park consisted of 202 lots. Until approximately April 30, 2011, Lower Macungie Township ("LMT") billed for sewer usage within the mobile home park by sending plaintiffs a single quarterly bill for sewer usage by all of the park residents. LMT had an ordinance providing that the owner of property containing multiple units was responsible for the payment of all sewer charges, and the ordinance further provided for a single billing.
On April 21, 2011, counsel for plaintiffs sent a letter to the attorney for LMT regarding individual billing for sewer usage by the park's residents, rather than a single billing to plaintiffs. LMT's attorney sent a letter dated April 28, 2011, confirming the contents of the letter from plaintiffs' counsel. The letter of April 28, 2011, further indicated that if plaintiffs preferred a more formal document, counsel for plaintiffs could prepare a proposed agreement and forward it to LMT's attorney for review. Plaintiffs did not prepare a more formal document memorializing the parties' agreement. LMT's board of commissioners did not take any action to formalize or approve the individual billing of the park's residents for the sewer charges.
Beginning on approximately April 30, 2011, and continuing until about January 31, 2016, LMT billed the residents of the park on an individual basis for their sewer usage, rather than sending a single bill to plaintiffs. In early February 2016, LMT notified plaintiffs that they would be billed singly for all sewer charges relating to the park, rather than billing the lot owners individually. Plaintiffs refused to pay any billings from LMT, and this action followed.
The court found a valid contract was formed based on the letters between the attorneys in April 2011. The initial letter from plaintiffs' counsel constituted an offer, which was accepted when LMT's attorney confirmed its contents. The fact that a more formal agreement was never drawn up did not make the parties' agreement ineffective. The lack of consideration was not fatal to plaintiffs' claim, because the court concluded promissory estoppel allowed enforcement of the agreement. LMT's counsel promised that subsequent billing for sewer usage at the park would be to the individual owners. Plaintiffs relied on this and changed their lease agreement and policies. The court held that enforcing LMT's promise was the only way to avoid injustice because there was no adequate remedy that could bring the parties back to April 2011 with regard to their legal rights. Furthermore, LMT operated consistently with the terms of the parties' agreement by billing individually for approximately five years, until LMT unilaterally decided to no longer perform consistently with the contract.
The court required LMT to continue with individual billings to the park's residents, but if residents failed to pay, plaintiffs remained responsible to pay LMT for the sewer charges.