Richard J. Orloski, Deputy Atty. Gen., Dept. of Justice, Harrisburg, for appellant.
Metzger, Hafer, Keefer, Thomas & Wood, Heath L. Allen, William E. Miller, Jr., Harrisburg, for appellee.
Jones, C. J., and Eagen, O'Brien, Roberts, Pomeroy, Nix and Manderino, JJ. Pomeroy, J., concurs in the result.
This is an appeal from an order of the Commonwealth Court, proceeding under its original jurisdiction,*fn1 from which the Commonwealth appealed. The Commonwealth filed a complaint in assumpsit seeking judgment in the amount of $10,000 plus interest and costs against appellee, Transamerica Insurance Company. The asserted liability was predicated upon a bond (entitled Public Employe Faithful Performance Blanket Position Bond) issued
by Transamerica's predecessor company which undertook to indemnify the Commonwealth against any loss, up to a maximum of $10,000 caused to the Commonwealth through the failure of designated Commonwealth employees to faithfully perform duties and/or properly account for all monies and property received by virtue of their position. Preliminary objections of appellee were overruled and an answer was filed. Thereafter, both parties filed motions for summary judgment.
Judge Kramer, on March 8, 1974, entered an order denying the Commonwealth's motion, granting the motion filed by Transamerica, and dismissing the complaint. The single issue presented in this appeal and answered in the affirmative by Judge Kramer was whether the Commonwealth was barred from recovery under the term of the bond limiting the period of time in which suit could be instituted.
The facts set forth in the record (which consist of the complaint, answer and the deposition of bond claim counsel of appellee) and found by the Learned Court below were as follows:
The bond in question became effective July 1, 1963, and remained in force through August 25, 1967. Section 6 of that instrument provided:
"No suit, action or proceeding of any kind to recover on account of loss under this bond shall be brought after the expiration of three years from the cancellation of this bond as an entirety, provided, however, that if such limitation for bringing suit, action or proceeding is prohibited or made void by any law controlling the construction of this bond, such limitation shall be deemed to be amended so as to be equal to the minimum period of limitation permitted by such law."
During the period that the bond was in force, an employee of the Commonwealth was suspected of embezzling funds. Prior to ...