I.A. Construction Corp. v. Department of Transportation

591 A.2d 1146, 139 Pa. Commw. 509, 1991 Pa. Commw. LEXIS 251
CourtCommonwealth Court of Pennsylvania
DecidedMay 6, 1991
DocketNos. 1040 and 1100 C.D. 1990
StatusPublished
Cited by8 cases

This text of 591 A.2d 1146 (I.A. Construction Corp. v. Department of Transportation) is published on Counsel Stack Legal Research, covering Commonwealth Court of Pennsylvania primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
I.A. Construction Corp. v. Department of Transportation, 591 A.2d 1146, 139 Pa. Commw. 509, 1991 Pa. Commw. LEXIS 251 (Pa. Ct. App. 1991).

Opinion

BARRY, Senior Judge.

I.A. Construction Corp. (I.A.), individually and on behalf of H. Miniscalco & Sons, Inc. (Miniscalco), Miniscalco, individually, and the Department of Transportation (DOT) have filed cross-appeals from an order of the Pennsylvania Board of Claims (Board) which ordered DOT to pay damages to both I.A. and Miniscalco; the damages awarded were less than the amount sought by I.A. and Miniscalco.

I.A. was the low bidder on a project to reconstruct and improve the Platt Bridge in Philadelphia. I.A. subcontracted with Miniscalco to perform work which is at issue in this litigation. Put in its simplest terms, Miniscalco was to dig a pipe trench at each of the many piers on the east side of the bridge, install an eighteen inch reinforced concrete pipe, connect that pipe to the existing box sewer owned by the City of Philadelphia and backfill the trench.

In formulating its bids, both I.A. and Miniscalco relied upon a drawing which was made a part of the contract. That drawing showed details relating to the drainage work at each of the piers. The drawing specified that the pipe would be placed on a uniform slope between each of the piers but indicated that the actual elevation of the line and the box sewer connections could vary from pier to pier. The drawing indicated that the line from the base of the piers to the box sewer was straight. Furthermore, the drawing contained no indications of any obstructions between the base of the piers and the sewer tie-in.

[513]*513Eighteen of the piers were located on property owned and operated by Gulf Oil Company (Gulf). As a result, the contract contained a specific provision for shut downs occasioned by an emergency at the Gulf Refinery. That provision provided, inter alia, that DOT would be responsible for costs associated with delays resulting from shut downs of the project due to emergencies at the Gulf Refinery.

In July of 1982, Miniscalco submitted a bid to I.A. for the work described above. I.A. used that bid when it formulated its own bid for the entire project. I.A. was awarded the contract which it and DOT signed on September 8, 1982.

Miniscalco mobilized at the job site in November, 1983, and began work at the end of December, 1983. Miniscalco had estimated that it would take approximately twenty days to complete its work. Almost immediately after commencing work, the first of a litany of problems arose. Excavation revealed a number of obstructions below the surface in the area where the drains were to be laid, including various utility lines and a twelve inch iron pipe. These obstructions, none of which appeared in the drawing relied upon in submitting the bids, prevented the work from being done in the anticipated manner. The result was additional labor and material costs. Before Miniscalco was able to complete the job, a right-of-way dispute between DOT and Gulf resulted in the suspension of work on the drains for more than a week. Immediately after resuming work, oil was discovered in the drain trenches, thereby requiring the suspension of all “hot” work in the area of the trenches. The source of the leak was eventually discovered and Gulf agreed to provide a pump and crew to remove the oil. Miniscalco returned to work but the pump and crew were not supplied by Gulf. During this entire period of time, a dispute arose between DOT and the City of Philadelphia concerning the connections to the box sewer. Until this dispute was resolved on March 15,1984, Miniscalco was told by both DOT and the City not to make the connections. During this entire period, I.A. was requesting that DOT issue extra work orders to cover the unanticipated extra [514]*514costs. DOT refused to do so. By the end of April, 1984, Miniscalco had been able to complete less than half of the work required. Miniscalco and I.A. terminated their subcontract in an amicable fashion. I.A. completed the work and sought extra compensation for both itself and Miniscalco.

I.A. then brought the present action and the matter was heard by the Board of Claims. The Board, after a week long hearing, issued findings of fact and conclusions of law, whereby it ordered DOT to pay I.A. and Miniscalco damages but in amounts less than they had sought. The Board subsequently amended its order to change the amounts due. Nonetheless, both I.A., in its own right and on behalf of Miniscalco, and DOT appealed to this Court.

Our scope of review is limited to determining whether the Board’s factual findings are supported by substantial evidence or whether the Board committed an error of law. Department of Transportation v. Trumbull Corp., 99 Pa. Commonwealth Ct. 557, 513 A.2d 1110 (1986). In its appeal, DOT argues that the Board erred in permitting Miniscalco to maintain a direct claim against DOT and recover on that claim because Miniscalco was not a prequalified approved contractor. Miniscalco had been issued a prequalification certificate by DOT in February of 1983 but that certificate had expired six months later, approximately two months before Miniscalco began working on the project. The Board recognized that Miniscalco’s prequalification certificate had lapsed but held that DOT was es-topped from asserting this defense because it knew that Miniscalco was working as a subcontractor and “[a]t no time did PennDOT take any steps to prevent Miniscalco from performing work on the Project as a subcontractor, and IA and PennDOT’s Central and District Offices treated and referred to Miniscalco throughout the term of the subcontract as IA’s subcontractor.” (Board’s Finding of Fact No. 24, issued April 13, 1990). DOT argues now, as it did before the Board, that I.A. was carrying the Miniscalco employees on its payrolls which prevented DOT from know[515]*515ing Miniscalco’s actual status. The Board, however, in its fact-finding capacity, decided that DOT did have knowledge of Miniscalco’s status as a subcontractor. As this finding is supported by substantial evidence in the record, we agree with the Board’s legal conclusion that DOT is estopped from now asserting that Miniscalco was not a properly qualified subcontractor.

DOT next argues that the Board erred in holding that DOT was liable for any damages. In Acchione v. Department of Transportation, 501 Pa. 337, 461 A.2d 765 (1983), the Supreme Court held that a contractor may recover where it suffers financial harm because it relied upon a material misrepresentation of the government agency. DOT argues that Acchione is not applicable because it made no misrepresentations in this case. We cannot accept DOT’s argument.

DOT asserts that the drawing which shows the details of the drainage work which I.A. and Miniscalco relied upon in submitting the bid was not a representation by DOT. As already mentioned, this drawing showed that the drainage pipe would be laid in a straight line. Furthermore, the drawing contained no indication that any underground utility lines or pipes were in the vicinity of the work. Witnesses for both Miniscalco and I.A. testified that it was customary in the construction field for contractors to rely upon such drawings in submitting bids, especially with regard to the location of underground utilities. As the Board found in its findings of fact, DOT worked for over four years to formulate the plans for this project. The Board found that the contractors reasonably relied upon the drawing when they submitted bids in this case.

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Bluebook (online)
591 A.2d 1146, 139 Pa. Commw. 509, 1991 Pa. Commw. LEXIS 251, Counsel Stack Legal Research, https://law.counselstack.com/opinion/ia-construction-corp-v-department-of-transportation-pacommwct-1991.