Overview of Force Majeure
With COVID-19 headlines dominating the news cycle, and with no end in sight to the uncertainty that the virus brings, affected businesses are wise to consider whether the current pandemic qualifies as a “force majeure.”  In the last few weeks, the Chinese government has issued “force majeure certificates” to domestic businesses as a way of shielding companies from breach of contract claims, American businesses are sending mass e-mails to customers explaining that the virus prevents the company’s performance or operations, and businesses in an array of industries have sent formal inquiries to their service providers seeking confirmation of continued performance.

What is “Force Majeure”
The defense of force majeure will excuse a party’s performance under a contract if
Continue Reading Force Majeure Provisions and the Impacts of COVID-19

Please see below regarding the Governor’s order from our Government Relations and Labor & Employment Groups.  Do not hesitate to contact anyone at McNees with questions, including how this order might apply to your job site, project approvals or your office.  McNees is a full service law firm that remains operational, remotely and in compliance with the Governor’s order.  We are ready and able to continue to support our clients’ needs during this trying time.

UPDATE: Latest on Gov. Wolf’s Closure Order amid COVID-19 Outbreak

 As detailed in a special edition of Capitol Buzz sent on Thursday evening, Gov. Tom Wolf ordered all “non-life-sustaining” businesses throughout Pennsylvania to physically close their operations in response to the COVID-19 coronavirus outbreak. The new directive, which went into effect at 8 p.m. on Thursday evening, contains the threat of enforcement action
Continue Reading Governor Wolf’s Closure Order

In the 2007 film There Will Be Blood, Eli Sunday offers to sell Daniel Plainview the drilling rights to land of the recently-deceased William Bandy. Plainview mocks Sunday’s offer, revealing that he has already drained Bandy’s land dry of oil, and the land is now worthless. To illustrate, Plainview uses the analogy of reaching a straw across the room to drink Sunday’s imaginary milkshake. Plainview shouts “I drink your milkshake . . . I drink it up!” in Sunday’s face.

The practice of draining hydrocarbons from beneath an adjoining property is nothing new and is subject to the legal concept known as “the rule of capture.” In the context of oil and gas law, the rule of capture precludes liability for draining oil and gas from under another’s property so long as there has been no trespass. In Pennsylvania, a trespass occurs when a person intrudes onto property owned by someone else without their consent or places an object on someone’s property without their consent. On January 22, 2020, the Supreme Court of Pennsylvania declared that protection under the rule of capture applies to hydraulic fracturing, i.e. “fracking.” More specifically, developers who use hydraulic fracturing may rely on pressure differential
Continue Reading I Drink Your Milkshake! Fracking and the Rule of Capture

In a series of posts last year (available HERE and HERE), I discussed the Pennsylvania Supreme Court’s revival of the long-dormant Environmental Rights Amendment (“ERA”) to the Pennsylvania Constitution.  This summer, the Pennsylvania Commonwealth Court authored another chapter in the ERA saga.  Stick with me, because it is about to get technical…

As you may recall, in Pennsylvania Environmental Defense Fund (“PEDF”) v. Commonwealth, 161 A.3d 911 (Pa. 2017), the Pennsylvania Supreme Court found that the ERA created a public trust, the corpus of which was all of Pennsylvania’s public natural resources.  In this analogy, the Commonwealth is the trustee and Pennsylvania’s citizens are the named beneficiaries of the trust.  When state park land is leased by Pennsylvania’s Department of Conservation and Natural Resources for oil and natural gas extraction, any royalties – monthly payments based on the gross production of oil and gas at each well – are proceeds received in exchange for trust assets.  As a result, royalties must be returned to the trust as part of its corpus.  In other words, they are earmarked for the conservation and maintenance of Pennsylvania’s natural resources.
Continue Reading PEDF v. Commonwealth Redux: The Commonwealth Court Weighs In

Our Energy and Environmental Practice Group issued a client alert today related to a rule released by the EPA and USACE that deals with “waters of the United States.”  The rule will impact land development and permitting.  The first two paragraphs of the article are reproduced below and additional details and the full text of

Earlier this year, Claudia Shank blogged about the revival of the Environmental Rights Amendment (the “ERA”) (available HERE) after the Pennsylvania Supreme Court’s decision in Pennsylvania Environmental Defense Fund v. Commonwealth, 161 A.3d 911 (2017).  The PEDF decision breathed new life into the 1972 amendment to the Pennsylvania Constitution, but also left many unanswered questions about the ERA.  The most relevant unanswered question for developers and municipalities was the meaning of the revived ERA in the land use context.  Last week, the Commonwealth Court provided some insight.

In Frederick v. Allegheny Twp. Zoning Hearing Board, 2018 Pa. Commw. LEXIS 593 (Commw. Ct. Oct. 26, 2018), the Court reviewed a substantive validity challenge to a zoning ordinance that permitted oil and gas wells by right in all zoning districts of a township.  In a 5 to 2 decision, an en banc panel rejected the challenge (and the accompanying land use appeal to a zoning permit) that was filed by objectors to an unconventional gas well project in a residential zoning district.  The Court dismissed the objectors’ argument that
Continue Reading The Commonwealth Court Begins to Answer What the Environmental Rights Amendment Means to Land Use

This post, which is the second in a two-part series exploring the scope of Pennsylvania’s Environmental Rights Amendment (the “ERA”), will delve deeper into the text of the ERA as analyzed and explained by the Pennsylvania Supreme Court in Pennsylvania Environmental Defense Fund (“PEDF”) v. Commonwealth, 161 A.3d 911 (Pa. 2017).

In PEDF, the Court ruled that the ERA grants citizens of the Commonwealth two distinct rights: 1) the right to clean air and pure water, and to the preservation of natural, scenic, historic and esthetic values of the environment; and 2) the right of common ownership by the people, including future generations, of Pennsylvania’s public natural resources. The Court noted that the first right, which comes directly from the text of the ERA itself, “places a limitation on the state’s power to act contrary to [the] right, and while the subject of the right may be amenable to regulation, any laws that unreasonably impair the right are unconstitutional.” Despite this declaration by the Court, the scope and meaning of the first right remains undefined. It remains to be seen how the courts will define “clean air” or “pure water” and even more intangibly, who will determine which “scenic” or “esthetic” values are worthy of preservation?
Continue Reading The PA Supreme Court’s Revival of the Environmental Rights Amendment – Part 2

Although the Environmental Rights Amendment (the “ERA”) to the Pennsylvania Constitution was ratified in 1971, for many years it was rarely a topic of discussion among land use practitioners. Recent Pennsylvania Supreme Court jurisprudence, however, has revived this long-dormant amendment, and is reason to reconsider the ERA’s potential impact on development projects. This two-part post will explore the history of the ERA, the current legal standard for evaluating ERA violations as articulated by the Supreme Court, and potential future implications of the Court’s decision.

The ERA, found in Article I, Section 27 of the Pennsylvania Constitution, provides as follows:

The people have a right to clean air, pure water, and to the preservation of natural, scenic, historic and esthetic values of the environment.  Pennsylvania’s public natural resources are the common property of all the people, including generations yet to come.  As trustee of these resources, the Commonwealth shall conserve and maintain them for the benefit of the people.
Continue Reading The PA Supreme Court’s Revival of the Environmental Rights Amendment – Part 1

A large-scale natural gas liquids pipeline project traversing the Commonwealth has shed light on an oft misunderstood legal principle regarding the municipal regulation of utilities. Municipalities typically operate under the assumption that essentially all land uses, including public utilities, are subject to municipal regulation to at least some degree (e.g., zoning ordinances, subdivision and land development ordinance, etc.). But, most public utility facilities actually are not subject to local regulation. A pair of recent Commonwealth Court cases reinforce this legal principle that is nearly sixty-five years old but rarely reflected in municipal ordinances.
Continue Reading What do you mean that pipeline isn’t subject to zoning regulations?