XPRESS TRUCK LINES, INC., Appellant, v. PENNSYLVANIA LIQUOR CONTROL BOARD, Holt Hauling & Warehousing Systems, Inc., and Dennis Trucking Company, Inc., Appellees.
Supreme Court of Pennsylvania.
Decided Dec. 14, 1983.
469 A.2d 1000
Argued May 23, 1983.
However, as there is no evidence that the Commonwealth Court abused its discretion in denying appellant‘s application for counsel fees, I concur in the result.
Gerald Gornish, M. Ellen Moffett, Philadelphia, for appellee Holt Hauling et al.
Delancey W. Davis, Deputy Atty. Gen., for Attorney General and Pennsylvania Liquor Control Board.
Ralph G. Wellington, Philadelphia, for appellee Dennis Trucking.
Before ROBERTS, C.J., and LARSEN, FLAHERTY, MCDERMOTT, HUTCHINSON and ZAPPALA, JJ.
OPINION OF THE COURT
HUTCHINSON, Justice.
Appellant, XPress Truck Lines, Inc., (XPress) has filed its notice of appeal, as of right, directly to this Court from Commonwealth Court‘s order dismissing what appellant calls an action addressed to the original jurisdiction of that court1 in a dispute between it and appellees over the making, validity and continuing enforceability of a contract for delivery services allegedly awarded to it by the Pennsylvania Liquor Control Board. For contract actions against the Commonwealth, our legislature has provided an exclusive legal remedy before the Board of Claims, which is generally adequate without resort to equitable jurisdiction
I.
At its meeting on October 21, 1981 the Pennsylvania Liquor Control Board decided not to renew appellee Holt Hauling & Warehousing Systems, Inc.‘s contract, for warehousing and delivery services at the Liquor Control Board‘s southeastern distribution center near Philadelphia, upon expiration of the contract by its own terms on April 30, 1982. Holt was properly notified of the Board‘s decision on January 27, 1982. The Liquor Control Board then solicited bids on a cost per case basis for such delivery and warehouse services by issuing an invitation for bids tо some sixty-nine companies.
In response only three bidders came forward. They were appellant, appellee Holt, and one United Paper Services Company. These three bids were publicly opened on March 1, 1982. Appellant‘s bid was apparently low, appellee Holt‘s high, while that of United Paper Services’ fell somewhere between the other two bids. However, before any contract was awarded a labor problem arose. Both appellant and United Paper Services concluded they would be unable to resolve that problem in a manner enabling them to perform the contract offered in their bids. They so advised the Liquor Control Board. The Board then rejected all bids on March 17, 1982, decided to operate the warehousing portion of the contract with its own personnel and entered into competitive negotiations for a delivery service contract with appellant and United Paper Services. The Board deliberately excluded appellee Holt from these negotiations.
The justification given for Holt‘s exclusion was two-fold: first, its submitted bid on the proposal for both warehousing and delivery services, showing a 36% increase over its current charges, was so high that its participation in negotiations would not be fruitful and second, its recent history of
The Liquor Control Board informed appellee Holt by letter of March 23, 1982 that all bids were rejected, but did not notify it of the negotiations on changed terms with the other two bidders. Holt learned of this new round of negotiations and its exclusion from them when it examined the minutes of the March 17th meeting. Thereupon, it requested permission to participate. On April 2, 1982 its request was refused and on April 6, 1982 it sought relief by filing an original suit in equity against the Liquor Control Board in Commonwealth Court. Holt Hauling and Warehousing Systems, Inc. v. Pennsylvania Liquor Control Board, 760 C.D.1982. In that suit appellee Holt sought a preliminary injunction against continuation of the negotiations without its participаtion. Appellant was not a party to that action although it later sought to intervene and, indeed, was a party to the stipulation which effectively ended it.
By the time Holt filed its equity suit negotiations between the other original bidders and the Liquor Control Board had apparently reached a head. The next day, April 7, 1982, the Board formally decided to award the delivery services contract to appellant. A staff member for the Liquor Control Board‘s executive director notified XPress of the award by telegram. However, the formalities and statutory approvals normally incident to the execution of such government contracts delayed execution by the Liquor Control Board. On May 4, 1982, with the contract awarded to XPress and apparently the subject of all necessary approvals, but still unexecuted by the Liquor Control Board itself, Commonwealth Court, without participation of appellant, granted appellee Holt‘s motion for an injunction against negotiations in Holt‘s absence and ordered the Liquor Control Board to negotiate in “good faith” with all interested parties.4
The next day, May 5, 1982, the Liquor Control Board appealed the preliminary decree in Holt‘s lawsuit to this court at 29 E.D. Appeal Docket, 1982. That same day in Commonwealth Court appellant filed a petition for intervention5 and a petition for reargument in the Holt action. It also filed the instant action seeking specific performance of the contract awarded it, but not yet reduced to a fully signed integrated writing. The action for sрecific performance was docketed in Commonwealth Court at 1065 C.D. 1982.
A hearing in appellant‘s instant action scheduled for May 10, 1982 was continued at appellant‘s request after the Board, on May 5, 1982, reversed its decision to operate the warehouse itself and sought to negotiate the full contract for which it had originally solicited bids. It issued requests for proposals to appellant, appellee Holt, United Paper Services and a fourth entity which had appeared on the scene, Dennis Trucking Company, Inc.
Holt, XPress, United Paper Services and Dennis then presented proposals within a May 12, 1982 deadline set by the Board. Thereafter Dennis was permitted to make several additional or alternate submissions following ex parte communication between it and Board of representatives. On May 20, 1982, the Board eliminated United Paper Services for non-compliance with the invitation and awarded the contract for delivery and warehousing services to Dennis, based on Dennis‘s second modification of its оriginal submission.
Appellee Holt and appellant promptly went back to court in their separate actions. The Holt action came on for hearing first, on May 24, 1982, but was continued until May 26. On May 26, after testimony was taken in a morning
This understanding was evidenced by stipulation among all parties, including appellant, even though Commonwealth Court had not yet acted upon its motion for intervention.6 The consideration for this agreement is set forth in the stipulation itself:
the mutual understanding [is] that all litigation which is presently before the Court involving any previous participation in negotiating contracts with the Liquor Control Board shall be dismissed without prejudice to XTL, to pursue whatever claims it may have for the alleged breach of contract.
On the rebid appellee Holt‘s proposal was lowest and the Liquor Contrоl Board awarded it a contract for both warehousing and delivery services. That contract was properly approved, fully executed and Holt is now performing under it. Despite the stipulation, appellant pursued this action for specific performance in Commonwealth Court and also applied to this Court on June 18, 1982 for leave to intervene in the Liquor Control Board‘s appeal of the Commonwealth Court‘s preliminary order in Holt‘s suit.
On June 23, 1982, Commonwealth Court took testimony in the instant case. On June 24, the Liquor Control Board unilaterally filed a praecipe to withdraw its appeal from Commonwealth Court‘s May 5, 1982 order to “negotiate in good faith” entered in the Holt suit. On June 25 this Court granted appellant‘s May 21, 1982 application for leave to intervene in that appeal.7 On July 12, 1982, Commonwealth
II.
Appellant‘s prayer for relief in its amended petition for review in Commonwealth Court requested a preliminary injunction restraining the Liquor Control Board from utilizing the services of Dennis Trucking Company and an order requiring the Liquor Control Board to specifically perform its contractual duties with XPress or to grant money damages to XPress for breach of contract.
The Act of May 20, 1937, P.L. 728, No. 193, was amended by the Act of October 5, 1978, P.L. 1104, No. 260, § 3,
Moreover, specific performance generally is not an appropriate remedy for breach of contract by a public body. Thus, in People ex rel. Ryan v. Aldridge, 83 Hun. 279, 31 N.Y.S. 920 (1894), the New York Court held that no person could be compelled by any process of law to prosecute any enterprise undertaken for purposes of his own, beyond the point at which he sees fit to discontinue the undertaking, and if he has contracted with another person to do the work and afterward refuses to have it done, the contractor is confined to an action of damages for breach. The New York Court held that such principles apply equally to public bodies. Similarly, this Court has held that specific performance is available only when there is no adequate remedy at law, i.e., when there is no method by which damages can be accurately computed or ascertained. Clark v. Pa. State Police, 496 Pa. at 313, 436 A.2d at 1385 (citing Strank v. Mercy Hospital of Johnstown, 383 Pa. 54, 117 A.2d 697 [1955], and H. Daroff and Sons, Inc. v. Vitullo, 350 Pa. 501, 39 A.2d 595 [1944]).
McIntosh Road Materials Co. v. Woolworth, 365 Pa. 190, 74 A.2d 384 (1950), cited by appellant, does not contradict that principle. In McIntosh we held that under certain circumstances an equity court has authority to order a Commonwealth official to finally execute an awarded contract when the award is not tentative and is within the permissible discretion of the official. In that case the Assistant Director of Purchases (Highways) for the Department of Property and Supplies had accepted plaintiff‘s bid which was in the form of a contract fully and completely
III.
On the merits of XPress‘s contractual claim Holt argues that McIntosh does not require the Board to execute a contract with XPress because, in the instant case, the staff of the Board was still negotiating the contract and had never presented it to the Board for approval and execution in final form. Holt relies on a line of cases which hold that no binding contract comes into existence unless the Commonwealth and its potential contractor strictly comply with procedures prescribed by statute, ordinance, instructions and agency practices. It argues since no contract was fully executed by all the appropriate and designated officials, no binding contract exists. Finally, it maintains that any contract between the Board and XPress is invalid because the bidding process was unfair. The Commonwealth simply argues that the contract with XPress was not binding because it was never signed by the comptroller or the Board‘s Executive Director. We need not reach these arguments on the merits because they are properly within the exclusive jurisdiction of the Board of Claims. See e.g. Commonwealth v. Seagram Distillers Corp., 379 Pa. 411, 109 A.2d 184 (1954).
IV.
This is not a case where an unsuccessful bidder argues the award of a contract is illegal because the bidding process was unfairly “infected.” Such cases are within
Prior to that stipulation Cоmmonwealth Court refused to allow appellant an opportunity to litigate the unfairness issue. Indeed, its application to intervene in the Holt action was ultimately denied by Commonwealth Court, again without opinion. Thus, the issue of whether there is a valid contract between XPress and the Liquor Control Board and the issue of damages are properly before the Board of Claims. Whether appellant‘s stipulated agreement to the rebid ipso facto cancelled any contract it may have had or preсluded it from preserving that issue are matters within the jurisdiction of the Board of Claims, subject to initial appellate review in Commonwealth Court as of right and further discretionary appellate review by this Court.
It would appear that the issue of “illegality” in the first award to appellant was never finally determined because the Commonwealth Court lacked jurisdiction over that cause in view of its failure to join appellant as an indispensable party. Although our cases generally hold that a
V.
We do not here reach the difficult issue of whether an apparently successful bidder can sit back and take no action in the face of a court ordered rebid, while still preserving a damage remedy before the Board of Claims. Such a case would require a determination of whether the Board‘s exclusive jurisdiction on contracts “entered into” includes exclusive power to determine whether a particular contract has in fact been “entered into” or whether protection of the public interest in the integrity of the bidding process and protection of the Commonwealth against double liability requires institution of timely action in Commonwealth Court to test that integrity by submitting the issue of validity to the court.
Here, appellant did make every effort to protect what it considered a binding contract. The question of whether there was a binding contract can be fully developed before the Board and reviewed in Commonwealth Court on a full record. Assuming the Board does have jurisdiction to determine the existence of the contract, the Board must also determine whether appellant‘s stipulated acquiescence in the rebid is so inconsistent with its assertion of a contract that it is precluded from seeking to enforce the latter by damages for breach, by analogy to the election one makes on recision.
Order affirmed.
NIX, J., did not participate in the consideration or decision of this case.
McDERMOTT, J., joins parts I-IV of this opinion and files a concurring opinion.
ROBERTS, C.J., files a concurring opinion in which ZAPPALA, J., joins.
McDERMOTT, Justice, concurring.
In this appeal we have, sua sponte, raised an issue concerning the avenues of access to this Court in a contract action involving the Commonwealth. The legislature has conferred upon the Board of Claims the exclusive jurisdiction to resolve disputes on contracts entered into by the Commonwealth. See
Today, we hold that all contract actions must proceed first to the Board of Claims, and then to the Commonwealth Court. See
Unfortunately, after announcing this clear rule, the majority in Section V, muddies the water by intimating that in some instances the Board of Claims may not have the power to decide whether or not a contract has beеn “entered into“. I believe that the exclusive jurisdiction of the Board of Claims includes the power in all instances to rule on whether or not a contract has been “entered into“. See, e.g. Smock v. Commonwealth, 496 Pa. 204, 436 A.2d 615 (1981); Clark v. Pennsylvania State Police, 496 Pa. 310, 436 A.2d 1383 (1981); and I find no reason to except the situation posed by the majority in Section V.
Thus, I join in the opinion of the majority, except for the limitation intimated in Section V.
ROBERTS, Chief Justice, concurring.
Although I agree that this case should have been brought in the Board of Claims, I cannot agree with the majority‘s decision to treat appellant‘s direct appeal from the Commonwealth Court‘s dismissal of this case as a petition for allowance of appeal.
“The Supreme Court shall have exclusive jurisdiction of appeals from final orders of the Commonwealth Court entered in any matter which was originally commenced in said court and which does not constitute an appeal to the Commonwealth Court from another court, a district justice or another governmental unit.”
* Had the Commonwealth Court transferred the case to the Board of Claims instead of granting appellees’ motion to dismiss, the proper
majority‘s treatment of appellant‘s direct appeal as a petition for allowance of appeal manifestly disregards the express legislative conferral of direct appellate jurisdiction upon this Court, I concur only in the result.
ZAPPALA, J., joins in this concurring opinion.
Notes
§ 761. Original jurisdiction.
(a) General rule.--The Commonwealth Court shall have original jurisdiction of аll civil actions or proceedings:
(1) Against the Commonwealth government, including any officer thereof, acting in his official capacity, except:
(iii) actions on claims in which immunity has been waived pursuant to Chapter 85 (relating to matters affecting government units) or the Act of May 20, 1937 (P.L. 728, No. 193) referred to as the Board of Claims Act;
(2) By the Commonwealth government, including any officer thereof, acting in his official capacity, except eminent domain proceedings. Act of October 5, 1978, P.L. 1104 No. 260, § 2, as amended.
(a) General rule.--The Supreme Court shall havе exclusive jurisdiction of appeals from final orders of the Commonwealth Court entered in any matter which was originally commenced in said court and which does not constitute an appeal to the Commonwealth Court from another court, a district justice or another government unit. Act of April 28, 1978, P.L. 202, No. 53 § 5.
“If an appeal is improvidently taken to the Supreme Court under Rule 1101 (appeals as of right from the Commonwealth Court) in a case where the proper mode of review is by petition for allowance of appeal under this chapter, this alone shall not be a ground for dismissal, but the papers whereon the appeal was taken shall be regarded and acted on as a petition for allowance of appeal and as if duly filed in the Supreme Court at the time the appeal was taken. See
