A. Scott Enterprises, Inc. v. City of Allentown
102 A.3d 1060
Pa. Commw. Ct.2014Background
- Contractor won the City’s bid for a one-mile two-lane road (New England Avenue), with PennDOT funding under Publication 408.
- Publication 408 governs project specifications and prohibits reimbursement for certain environmental or design-related costs unless PennDOT approves.
- Hazardous materials at the site were suspected; the City did not test or address contamination before proceeding.
- Arsenic-contaminated soil concerns led to suspension of work on November 25, 2009, and later site evaluations by APEX and Contractor’s experts.
- Disputes over extra work, force account payments, and additional costs culminated in a jury verdict awarding Contractor about $927,299 for losses; the City challenged post-trial remedies, leading to an appeal and cross-appeal, with the trial court’s 2013 judgment and 2014 post-trial proceedings.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Expert qualification for Maloney and DiMarco | City argued Maloney/DiMarco lacked proper expertise | Contractor argued them as qualified experts based on experience | Court affirmed admissibility of both experts |
| Bad faith instructions and jury involvement | City contends bad faith issue should not have gone to jury | Bad faith appropriate for jury determination under Procurement Code | Jury could determine bad faith; issue properly submitted to jury |
| Damages for suspension, overhead, and lost profits under Publication 408 | City argues suspension costs/overhead not recoverable; some damages barred | Contractor entitled to suspension costs, overhead, and lost profits where applicable | Suspension costs and overhead/lost profits recoverable under Publication 408; specifics guided by statute and case law |
| Procurement Code penalties and attorney’s fees on bad faith | Penalty and attorney’s fees not mandatory; discretionary | Penalty/fees should be awarded where bad faith found | Penalties and attorney’s fees must be awarded upon a jury finding of bad faith; remand for determining amount and prejudgment/postjudgment interest |
| Pre- and post-judgment interest determinations | Contractor seeks prejudgment/postjudgment interest where due | Interest available only where contract/damages ascertainable | Prejudgment interest: awarded on definite contract items; not on suspension costs/overhead/lost profits; post-judgment interest awarded; remand to calculate precise amounts |
Key Cases Cited
- Kraus v. Taylor, 710 A.2d 1142 (Pa.Super.1998) (waiver concerns discussed (obiter) about presenting facts in the light favorable to the verdict winner)
- Brown v. Commonwealth of Pennsylvania, 843 A.2d 429 (Pa.Cmwlth.2004) (issues raised below or properly briefed; waiver principle)
- James Corp. v. North Allegheny School District, 938 A.2d 474 (Pa.Cmwlth.2007) (bad faith determination is a question of fact for the jury)
- Cummins v. Atlas Railroad Construction Co., 814 A.2d 742 (Pa.Super.2002) (bad faith aspects tied to Procurement Code)
- Pietrini Corp. v. Agate Construction Co., 901 A.2d 1050 (Pa.Super.2006) (arbitrary/vexatious withholding defined; supports penalties/fees)
- City of Independence v. Kerr Construction Paving Company, Inc., 957 S.W.2d 315 (Mo.Ct.App.1997) (interpretation of ‘may’ vs. ‘shall’ in procurement context)
- Gold & Company, Inc. v. Northeast Theater Corporation, 281 Pa.Super. 69 (Pa.Super.1980) (prejudgment interest rules under Restatement approach)