Legal Coal Co. v. Rice

11 Pa. D. & C.2d 245, 1957 Pa. Dist. & Cnty. Dec. LEXIS 159
CourtPennsylvania Court of Common Pleas, Dauphin County
DecidedMay 31, 1957
Docketequity docket no. 2199; Commonwealth Docket, no. 247
StatusPublished

This text of 11 Pa. D. & C.2d 245 (Legal Coal Co. v. Rice) is published on Counsel Stack Legal Research, covering Pennsylvania Court of Common Pleas, Dauphin County primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Legal Coal Co. v. Rice, 11 Pa. D. & C.2d 245, 1957 Pa. Dist. & Cnty. Dec. LEXIS 159 (Pa. Super. Ct. 1957).

Opinion

Kreider, J.,

Plaintiff, Legal Coal Company, filed a petition for an injunction seeking to enjoin the Secretary of the Department of Property and Supplies of the Commonwealth of Pennsylvania from rejecting its bid to supply 50 tons of rice size [246]*246anthracite coal. Plaintiff has joined the Auditor General and State Treasurer as parties defendant and seeks to prevent them from approving any contract except to itself for the coal in question.

The principal issue is whether the Secretary of Property and Supplies may require as a specification in an invitation for bids for a contract for coal to be furnished the Commonwealth that the suppliers of coal pay “the prevailing wage rate” and whether the secretary may reject the bid of the lowest bidder which pays the Federal minimum wage rate to its empoyes?

Plaintiff and defendants filed an “Agreed Statement of Facts” consisting of 21 paragraphs and have stipulated that this “shall be considered as the testimony on the final hearing on the petition filed by the Legal Coal Company. . . .”

Facts

It is stipulated that plaintiff is a Pennsylvania corporation which employes approximately 14 men in the operation of its breaker in Hegins Township, Schuylkill County, that the breaker is equipped with coal cleaning machinery which is used for the preparation of anthracite coal for market. Plaintiff purchases run-of-the-mine coal from independent mines and produces about 550 tons of prepared anthracite coal for market each working day.-It is further stipulated that plaintiff company, its employes and the men working at the independent mines from which the Legal Coal Company purchases coal for preparation for market are not bound by any wage agreements except that set forth by the United States Government relating to minimum wages, that plaintiff carries workmen’s compensation insurance and makes the payments required by the Pennsylvania Unemployment Compenastion Act and that plaintiff does not have a fixed wage scale or other benefit earnings and [247]*247work conditions to promote health, welfare and safety conditions. It is further stipulated that the clause in the general specifications that “the bidder or his supplier shall not pay less than prevailing wages as listed below limits the number of bidders which can meet the requirements of “Invitation-Bid Proposal Inquiry No. 14-191” which was circulated by the secretary to prospecitve bidders.1 It is also stipulated [248]*248that plaintiff, Legal Coal Company, was the low bidder for the anthracite coal in question and that plaintiff’s coal meets the chemical analysis and the requirements of the Commonwealth of Pennsylvania.

Plaintiff contends that the Secretary of the Department of Property and Supplies .has no authority to fix wages and incorporate a “prevailing wage” provision in specifications of contracts prepared by his department. Plaintiff says that Pennsylvania does not have a statute permitting the fixing of wages by bidders who undertake to supply materials for State contracts. It invokes article III, sec. 12, of the Pennsylvania Constitution of 1874, which provides:

“All stationery, printing, paper and fuel used in the legislative and other departments of government shall be furnished, and the printing, binding and distributing of the laws, journals, department reports, and all other printing and binding, and the repairing and furnishing the halls and rooms used for the meetings of the General Assembly and its committees, shall be performed under contract to be given to the lowest responsible bidder below such maximum price and [249]*249under such regulations as shall be prescribed by law; no member or officer of any department of the government shall be in any way interested in such contracts, and all such contracts shall be subject to the approval of the Governor, Auditor General and State Treasurer.” (Italics supplied.)

Plaintiff also contends that section 2409 of article XXIV of the Administrative Code of April 9, 1929, P. L. 177, as amended, 71 PS §639, in paragraph 8 thereof carries the above quoted provision of the Constitution into effect and also requires contracts for materials to be let to the lowest responsible bidder. Section 2409 is, in part, as follows:

“The department shall, on the date fixed for opening of bids, at the hour designated in the proposal, open and publish said proposals, and, as soon thereafter as practicable, award the contracts to the lowest responsible bidder. . . .” (Italics supplied.)

It may also be noted that section 2403 of article XXIV of The Administrative Code of 1929, supra, as amended, 71 PS §633, provides:

“The Department of Property and Supplies shall have the power, and its duty shall be: . . .
“(b) To enter into contracts for supplying all stationery, printing paper, and fuel, used in the legislative and other departments of the Government, and for repairing and furnishing the halls and rooms used for the meetings of the General Assembly and its committees. All such contracts shall be awarded to the lowest responsible bidder below such maximum price, and under such regulations as are prescribed by this act, and shall be subject to the approval of the Governor, the Auditor General, and the State Treasurer.” (Italics supplied.)

In sum, plaintiff contends that the attempt of the Department of Property and Supplies to stipulate wages and other working conditions, not covered by [250]*250the statute, in contracts for materials is illegal and void, that it restricts competitive bidding and prevents the State from purchasing coal from the lowest responsible bidder and violates the common standard provision as set forth in the decisional law of this Commonwealth with respect to bidding on public contracts.

Defendants’ Contentions

Defendants contend that in both the Pennsylvania Constitution of 1874 and The Administrative Code of 1929, as amended, authority is granted to officials of the Commonwealth to “. . . prescribe rules and regulations for the submission of bids, awards, forms of contracts and other matter related thereto”: Section 2, Act of June 12, 1951, P. L. 516, 71 PS §633(c). Defendants in effect say that because they are given the authority to make regulations under section 12, art. Ill, of the Constitution and likewise under The Administrative Code, as amended by the Act of 1951, supra, they have adequate authority to promulgate such specifications as they deem proper and just, that the specifications in question were drawn in the exercise of the discretion permitted defendant officials, that the terms and conditions upon which bids were made were deemed adequate to provide full competition and that the standards adopted were those deemed best for the Commonwealth and were not a matter of benefiting a favored class. Defendant^ further contend that once the specifications had been issued there was no alternative but to take the lowest responsible bid of those who met the qualificati'ons and the specifications in the invitation for bids.

It must be noted, however, that section 2 of the Act of 1951, amending The Administrative Code of 1929, supra, 71 PS §633(c) provides that:

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11 Pa. D. & C.2d 245, 1957 Pa. Dist. & Cnty. Dec. LEXIS 159, Counsel Stack Legal Research, https://law.counselstack.com/opinion/legal-coal-co-v-rice-pactcompldauphi-1957.