PETER SCOTT; ANNE SCOTT, husband and wife v. Stephen C. Turner

NOT PRECEDENTIAL
UNITED STATES COURT OF APPEALS
FOR THE THIRD CIRCUIT
No. 08-4451
_____________
PETER SCOTT;
ANNE SCOTT,
husband and wife,
Appellants
v.
STEPHEN C. TURNER;
NANCY HOKE TURNER
On Appeal from the United States District Court
for the Middle District of Pennsylvania
District Court No. 1-07-cv-02274
District Judge: The Honorable William W. Caldwell
Submitted Pursuant to Third Circuit L.A.R. 34.1(a)
September 16, 2009
Before: SLOVITER, FUENTES, and SMITH, Circuit Judges
(Filed: September 17, 2009 )
OPINION
SMITH, Circuit Judge.
This case arises from a 2006 land sale agreement between Peter and Anne Scott
(“the Scotts”) and Stephen and Nancy Hoke Turner (“the Turners”). The Scotts sued the

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The Scotts filed their lawsuit in the Adams County Court of Common Pleas. The1
Turners properly removed the case to the United States District Court for the Middle District of
Pennsylvania, pursuant to 28 U.S.C. §§ 1441 and 1446. The District Court had jurisdiction over
the Turners’ counterclaim under 28 U.S.C. § 1367. We have jurisdiction under 28 U.S.C. § 1291
and “exercise plenary review over the District Court’s grant of summary judgment.” Shuman ex
rel Shertzer v. Penn Manor School Dist., 422 F.3d 141, 146 (3d Cir. 2005) (internal citations
omitted). Summary judgment is appropriate “if the pleadings, the discovery and disclosure
materials on file, and any affidavits show that there is no genuine issue as to any material fact and
that the movant is entitled to judgment as a matter of law.” Fed. R. Civ. P. 56(c). The facts must
be viewed in the light most favorable to the non-moving party and all reasonable inferences from
the evidence must be drawn in that party’s favor. Conopco, Inc. v. United States, 572 F.3d 162,
165 (3d Cir. 2009).
2
Turners, claiming that they breached a contract to purchase land located in Freedom
Township in Adams County, Pennsylvania. The District Court granted summary
judgment for the Turners. This timely appeal followed. We will affirm the judgment of
the District Court.1
Section 403 of Freedom Township’s Municipal Subdivision and Land
Development Ordinance (“the Ordinance”) requires roadways in the Township to meet
certain specifications, including minimum right-of-way widths of 50 feet and minimum
cartway widths of 32 feet. On February 11, 1993, landowners Bradley and Mary Yohe
obtained a variance to these requirements from the Freedom Township Board of
Supervisors (“the Board”). That variance permitted a 16 foot wide gravel “right-of-way”
connecting one segment of the Yohes’ lot to Pumping Station Road. The variance
excused the right-of-way’s non-conformance with the Ordinance so long as certain
conditions were met. First, the variance was limited to the “period of time during which
the [Yohes] own[ed] all of the land.” The variance did “not extend to subsequent
owners.” Second, if the land in question were ever “subdivided to provide for more than

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three residential building lots,” then the variance would be “void,” and the right-of-way
would have to be upgraded to conform with the Ordinance.
In December of 1993, the Yohes sold a portion of their land (“Lot 2”) to the
Scotts, while retaining part of it (“Lot 1”) for themselves. The Scotts built a residence on
Lot 2, which was serviced by the right-of-way through Lot 1. The Yohes later subdivided
Lot 1, such that there are currently four residential lots on the tract of land described in
the variance.
In October of 2006, the Scotts agreed to sell Lot 2 and an adjoining lot to the
Turners for $1.25 million. That agreement required the Scotts to convey “good and
marketable” title to the land. Pursuant to the agreement, the Turners paid a $50,000
deposit into escrow. Upon learning of the variance, however, the Turners refused to
complete the sale. The Scotts sued the Turners for breach of contract; the Turners
counterclaimed for the return of their deposit. Both parties moved for summary
judgment. The District Court held that the Scotts, not the Turners, had breached the
agreement by failing to provide “marketable title” to the land. The Court granted
summary judgment in favor of the Turners and ordered the return of their deposit. The
Scotts appealed.
Pennsylvania courts have defined “marketable” title as title “that is free from liens
and encumbrances and which a reasonable purchaser, well informed as to the facts and
their legal bearings . . . would in the exercise of that prudence which businessmen
ordinarily bring to bear upon such transactions, be willing to accept and ought to accept.”

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Arguably, the variance expired when the Yohes sold part of the land to the2
Scotts. The variance plainly stated that it was “limited to the period of time during which
[the Yohes] own all of the land . . . and [did] not extend to subsequent owners.” The
Scotts claim that this provision should not void the variance because the Board voted in
November of 2007 to honor the variance notwithstanding the 1993 sale. We need not
decide the legal import of the Board’s vote, since we believe that in any event, the
variance expired with the creation of the fourth lot. We note that even though the Board
4
Barter v. Palmerton Area School Dist., 581 A.2d 652, 654 (Pa. Super. Ct. 1990). Under
Pennsylvania law, title is unmarketable if it would expose “the party holding it to
litigation.” Swayne v. Lyon, 67 Pa. 436 (1871); see also Moyer v. DeVicentis Constr. Co.,
164 A. 111, 112 (Pa. Super. Ct. 1933) (“one is not compelled to purchase under an
agreement for sale of real estate . . . where the title is in such condition that the purchaser
will be exposed to litigation”). We agree with the District Court that the Scotts’ title was
unmarketable because the variance permitting the gravel right-of-way expired, leaving the
property owner exposed to a lawsuit by the Township to conform the right-of-way to the
Ordinance. See Pennsylvania Municipalities Planning Code, 53 P.S. §§ 10515.1,
10515.3 (empowering municipalities to sue in law or equity to enforce subdivision and
land development ordinances).
The variance clearly states that “in the event the acreage shown . . . is further
subdivided to provide for more than three (3) residential building lots, then this variance
shall be void” and the cartway improved to conform to the Ordinance. This language
does not require that the right-of-way serve more than three lots, as the Scotts claim. The
mere creation of the fourth lot terminated the variance, to the extent that the Scotts’ 1993
purchase had not already done so.2

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voted not to enforce the first condition of the variance, it reaffirmed the three-lots-only
condition. The minutes of the November 2007 meeting reflect the Board’s continuing
view that “[i]f a fourth lot was ever subdivided, (with Board approval needed) the road
would have to comply with the road specifications required by the township.”
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The Scotts admit that there are presently four residential lots on the land described
in the variance. Therefore, the variance has expired. Given the non-conforming
right-of-way and the expired variance, the township could sue the owners of the property
and force them to upgrade the road at any time. As a results, the Scotts’ title was
unmarketable, and the Turners’ refusal to consummate the sale was not a breach of
contract. See Moyer, 164 A. at 112 (holding title unmarketable where the building to be
sold was built in violation of a local ordinance, as the buyer “could not take possession
without immediately becoming a violator of the law and subject to suit”). Rather, the
Scotts breached the land sale agreement by failing to provide marketable title. We will
therefore affirm the District Court’s order granting summary judgment for the Turners.

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