Excavation Technologies, Inc. v. Columbia Gas Co.

985 A.2d 840, 604 Pa. 50, 2009 Pa. LEXIS 2794
CourtSupreme Court of Pennsylvania
DecidedDecember 29, 2009
Docket32 WAP 2008
StatusPublished
Cited by73 cases

This text of 985 A.2d 840 (Excavation Technologies, Inc. v. Columbia Gas Co.) is published on Counsel Stack Legal Research, covering Supreme Court of Pennsylvania primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Excavation Technologies, Inc. v. Columbia Gas Co., 985 A.2d 840, 604 Pa. 50, 2009 Pa. LEXIS 2794 (Pa. 2009).

Opinions

[52]*52 OPINION

Justice EAKIN.

Before performing excavation work for a waterline extension project, appellant requested appellee mark the locations of gas lines around the work sites pursuant to the One Call Act (Act).1 Appellee improperly marked some lines and failed to mark others. As a result, appellant struck various gas lines, which hampered its work, resulting in economic damages of $74,502.06; appellant did not any sustain physical injury or property damage.

Appellant sued appellee on a theory of negligent misrepresentation under § 552 of the Restatement (Second) of Torts,2 claiming appellee failed to comply with its statutory duties under the Act. Appellee filed preliminary objections in the nature of a demurrer, arguing the economic loss doctrine precluded liability.3 The trial court sustained the objections; [53]*53appellant appealed.

The Superior Court affirmed, recognizing the economic loss doctrine generally precludes recovery in negligence actions for injuries which are solely economic. The court noted an exception for claims of negligent misrepresentation under § 552, which allows such claims to evade dismissal even if they assert purely economic losses. Excavation Technologies, Inc. v. Columbia Gas Company of Pennsylvania, 936 A.2d 111, 115-16 (Pa.Super.2007) (en banc ) (citing Bilt-Rite Contractors, Inc. v. Architectural Studio, 581 Pa. 454, 866 A.2d 270 (2005) (finding negligent misrepresentation claim against architect for economic loss viable under § 552)). However, the court concluded § 552(1) and (2) did not apply because, unlike the architect in Bilt-Rite, appellee was not in the business of supplying information for pecuniary gain. Id., at 116-17.

Further, the Superior Court declined to adopt § 552(3), reasoning the legislature did not intend to impose liability on utility companies for economic harm occasioned by an inaccurate response under the Act. The court noted the legislature did not provide a private cause of action for economic loss under the Act. Since the economic loss doctrine was well-established when the Act was enacted, the court found the legislature did not intend to impose liability under these circumstances. Id., at 119 (citing Commonwealth v. Miller, 469 Pa. 24, 364 A.2d 886, 887 (1976) (statutes not presumed to make changes in rules and principles of common or prior existing law beyond what is expressly declared in provisions)).

We granted allowance of appeal to determine whether § 552 of the Restatement (Second) of Torts imposes liability for economic losses to a contractor caused when a gas utility company fails to mark or improperly marks the location of gas lines. This is a pure question of law and, thus, our review is plenary. Bilt-Rite, at 274.

Further, “the standard of review for preliminary objections in the nature of a demurrer is limited; the question present[54]*54ed by the demurrer is whether, on the facts averred, the law says with certainty that no recovery is possible. Where a doubt exists as to whether a demurrer should be sustained, this doubt should be resolved in favor of overruling it.”
Id. (citations omitted).

Appellant argues appellee should be liable for economic losses under § 552(1) and (2), asserting that like the architectural firm in Bilt-Rite, appellee enjoys an economic benefit from providing accurate information about the location of its underground lines. Applying § 552 to this case, according to appellant, will serve the overall public interest by discouraging negligence among underground utility owners. Alternatively, appellant maintains appellee should be liable under § 552(3) because appellee is under a public duty to provide information about the location of its underground lines; when appellee supplies inaccurate or no information in response to a request under the Act, it violates that duty.

Appellee argues utility companies should not be equated with design professionals who are hired to prepare plans, drawings, and specifications for pecuniary gain. It asserts Bilt-Rite only carved out a narrow exception to the economic loss doctrine for design professionals. In response to appellant’s alternative argument, appellee urges this Court should not impose liability under § 552(3) because it would be contrary to legislative intent.

We find it apparent our legislature did not intend utility companies to be liable for economic harm caused by an inaccurate response under the Act, because it did not provide a private cause of action for economic losses. See generally 73 P.S. § 176 et seq. The economic loss doctrine was well-established in tort law when the Act was enacted, and when the Act was amended in 1986. See Aikens v. Baltimore and Ohio Railroad Company, 348 Pa.Super. 17, 501 A.2d 277, 278-79 (1985) (roots of economic loss doctrine first recognized in Robins Dry Dock and Repair Company v. Flint, 275 U.S. 303, 48 S.Ct. 134, 72 L.Ed. 290 (1927)). The legislature was presumably aware of the economic loss doctrine when it [55]*55established the statutory scheme governing the relationship among the entities required to participate under the Act. There is simply no statutory basis to impose liability for economic losses here. See In re Rodriguez, 587 Pa. 408, 900 A.2d 341, 345 (2003) (courts must assume legislature understands legal landscape on which it enacts laws, and when common law rule is not abrogated, they must assume it persists).

This matter is factually distinguishable from Bilt-Rite and, thus, § 552(1) and (2) do not apply. In Bilt-Rite, a school district and architectural firm entered into a contract for the design of a new school. As is typical in public contracting, the school district solicited bids from contractors and included the firm’s plans, drawings, and specifications in the bid documents. Based on this information, a contractor submitted a bid, which was accepted. During construction, the contractor discovered the firm’s specifications were wrong, which caused large cost overruns. The contractor sued the firm for negligent misrepresentation. The trial court found no privity existed between the architect and the contractor and dismissed the claim. Bilt-Rite, at 272-73. The Superior Court affirmed.

We reversed, holding privity was not a prerequisite for maintaining an action under § 552, and since there is no privity requirement, “the economic loss rule does not apply to claims of negligent misrepresentation sounding under Section 552.” Id., at 288.

Free access — add to your briefcase to read the full text and ask questions with AI

Related

Cite This Page — Counsel Stack

Bluebook (online)
985 A.2d 840, 604 Pa. 50, 2009 Pa. LEXIS 2794, Counsel Stack Legal Research, https://law.counselstack.com/opinion/excavation-technologies-inc-v-columbia-gas-co-pa-2009.