Judge Rules Against Expediting Family Courthouse Bankruptcy Case

By Amaris Elliott-Engel
Of the Legal Staff

A federal bankruptcy judge has ruled against settling the dispute over the property rights to the stymied Philadelphia family courthouse project with a mandatory preliminary injunction. The case will go to trial instead.

Bankruptcy Judge Eric L. Frank of the U.S. Bankruptcy Court for the Eastern District of Pennsylvania denied the Philadelphia Parking Authority's motion for emergency interim relief and request for an expedited hearing. A pretrial conference has been set for Sept. 23.

Northwest 15th Street Associates, the private developer at the center of the family courthouse project, told Frank in a court filing Monday evening that centuries of U.S. property law, as well as its constitutional rights to not be deprived of its property without due process of law, would be violated if the judge issued an interim order that would transfer title to the air rights at the proposed courthouse site.

The parking authority, however, told Frank he has the equitable power to settle definitively, with a mandatory preliminary injunction, whether the once-proposed developer of the courthouse project defaulted on its mortgage with the parking authority.

Northwest mortgaged the air rights to the proposed courthouse site at 15th and Arch streets from the Philadelphia Parking Authority, which still owns the underground part of the site.

Northwest 15th Street Associates, the corporate entity formed by developer Donald W. Pulver to develop the 15th and Arch streets site, filed for bankruptcy June 23 after the original family court structure unraveled in the wake of the revelation that Pulver struck a co-development deal with the First Judicial District's former tenant representative, Jeffrey B. Rotwitt. Pulver and Rotwitt have said that their deal was disclosed, while the FJD and the parking authority have said Rotwitt's dual role was not disclosed.

The planners of the courthouse project view time as of the essence because the successor to Gov. Edward G. Rendell, a former Philadelphia mayor and district attorney, may not commit to releasing the $200 million in capital funds earmarked by the Pennsylvania General Assembly for the project. A new governor, to be elected in November, would take office in January and is not bound by Rendell's commitment.