The Unsettled Law of Distraint Procedures in Pennsylvania

Bernstein-Burkley, P.C.

The ambiguity of the legality of remedies available to a landlord when presented with a defaulting tenant has put the landlord in a difficult situation in Pennsylvania. The Landlord and Tenant Act of 1951, 68 Pa.Stat.Ann. § 250.302 et seq (hereinafter “the Act”) was thought to be envisioned by the legislature to afford a complete and exclusive remedy for a landlord seeking to vindicate his rights against a defaulting tenant. The Act provides for a statutory lien on tenant’s goods for rents due up to one year and authorizes a distraint action, in which the landlord may lawfully take possession of, and sell for arrearages of rent, a tenant’s personalty found on the leased premises. Under the Law of Distraint, no enforceable landlord’s lien arises unless and until the statutory distraint procedures have been followed, which includes an appraisal and sale of the property within a reasonable period of time. The issue of legality arises as to the procedure permitting the attachment by state officials of the tenant’s personalty based on the landlord’s ex parte petition authorizing the Sheriff to hold a public sale of the tenant’s property.

The federal courts of Pennsylvania began raising questions about the unconstitutionality of the distraint procedures based on due process concerns for the tenant: primarily the lack of notice and opportunity to be heard. In 1986, the Pennsylvania Superior Court held that the distraint process was inoperative. Later, the Superior Court confirmed it had previously decided distraint was unconstitutional. The Pennsylvania Supreme Court has since explicitly recognized the Superior Court’s ruling. Even where distraint has not been explicitly recognized as unconstitutional, the courts have emphasized that strict notice requirements must be adhered to prior to lawful possession and disposition of the goods.

The problem becomes then for the Landlord attempting to assert his rights, what is a lawful action. For example, a landlord was held liable for conversion where he unilaterally took possession of a tenant’s equipment by physically barring the tenant from entering the premises and then selling the goods to a new tenant. Thus, the question becomes raised whether a landlord proceeding in a similar manner as the distraint process authorizes will be held liable in a tort action against the tenant for an unlawful act. Commentators have suggested that the Pennsylvania Supreme Court would recognize a cause of action for trespass under the Act for a landlord who uses self-help instead of the legal process to evict a tenant.

Further confusion exists because any self-help repossession remedy (remedy utilized prior to the Act) has been effectively rendered inoperable. Self-help eviction constitutes any acts undertaken to prevent a tenant from using the leased premises, other than by judicial process, including, but not limited to removing the tenant’s personal property, using or threatening to use force or violence, reducing or disconnecting utility services, or removing parts of the structure, such as doors and windows. Self-help repossession has been specifically enjoined in a commercial setting by the Pennsylvania Court. However, on the same basis the distraint procedures are unconstitutional; the Pennsylvania courts have treated self-help repossession as unconstitutional in that it involves the taking of property without affording a tenant notice and an opportunity to be heard.

Although many commercial leases commonly provide for landlord liens and may also include distress provisions permitting the landlord to sell the tenant’s personalty as a remedy for delinquent rent, it does not appear simply including the provision in the lease would give a landlord an actual lien without a court proceeding that includes notice and an opportunity to be heard. The Western Pennsylvania Bankruptcy Court has recognized the conflicting authority on landlord liens, distress and distraint in Pennsylvania stating that the relevant issue does not become whether the lease contains a distraint clause but whether the Debtor acted legally under Pennsylvania law. Thus, most commentators believe either the landlord’s lien pursuant to the distraint process is unenforceable and/or that the only form of distress or distraint available to the landlord is to post the premises and hope the tenant voluntarily surrenders the goods.

Thus, due to the current conflicting state of the law, it is suggested a landlord should not attempt self-help or seizure of a tenant’s property but rather should commence an eviction action. Moreover, this is so assuming a landlord who is owed money would rather be the plaintiff in a collection action against the tenant rather than a defendant in a conversion action brought by the tenant.

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