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GENERAL STATE AUTHORITY COMMONWEALTH PENNSYLVANIA v. PACIFIC INDEMNITY COMPANY (03/17/76)

decided: March 17, 1976.

THE GENERAL STATE AUTHORITY OF THE COMMONWEALTH OF PENNSYLVANIA, PLAINTIFF
v.
PACIFIC INDEMNITY COMPANY, DEFENDANT, AND KOPPERS COMPANY, INC., FLINTKOTE ROOFING MATERIALS, GYPSUM ROOF DECKS, INC., ROOFINGS, INC. AND MICHAEL R. COZZA & ASSOCIATES, ADDITIONAL DEFENDANTS



Original jurisdiction in case of The General State Authority of the Commonwealth of Pennsylvania v. Pacific Indemnity Company.

COUNSEL

John L. Sweezy, Assistant Attorney General, with him Richard O. Holahan, Assistant Attorney General, and Michael A. Madar, Chief Counsel, for plaintiff.

James F. Manley, with him Burns, Manley & Little, for defendant, Pacific Indemnity Company.

James K. Thomas, with him Joseph P. Hafer, and Metzger, Hafer, Keefer, Thomas & Wood, for additional defendant, Koppers Company, Inc.

Wallace E. Edgecombe, with him Robb, Leonard & Edgecomb, for additional defendant, Michael R. Cozza & Associates.

President Judge Bowman and Judges Crumlish, Jr., Kramer, Wilkinson, Jr., Mencer, Rogers and Blatt. Opinion by President Judge Bowman.

Author: Bowman

[ 24 Pa. Commw. Page 84]

Although plaintiff, General State Authority (GSA), has recently been merged into the newly created Department of General Services, it retains a limited vitality until the satisfaction of its bond obligations.*fn1 Hence, despite the GSA's temporal existence, its status for purposes of our jurisdiction in this case must be adjudicated.

The GSA was created by The General State Authority Act of one thousand nine hundred forty-nine*fn2 as a public corporation and governmental instrumentality for various purposes, including the construction and acquisition of public buildings for the use of the Commonwealth. 71 P.S. § 1707.4. It has a measure of autonomy in conducting its operations, 71 P.S. § 1707.7, however, its board is composed of executive and legislative officers of the Commonwealth and their appointees and is specifically designated as agent of the Commonwealth for taking title to property on behalf of the Commonwealth. 71 P.S. § 1707.4b. In summary, the legislation established an entity intimately related to the Commonwealth.

The origin of this assumpsit action is a written contract between the GSA and Allegheny Building Company as the general contractor for the construction of a dining hall/kitchen at California State College located in Washington County. Incident to this construction contract,

[ 24 Pa. Commw. Page 85]

Pacific Indemnity Company (defendant) issued a performance bond as surety for the general contractor. As a result of its bankruptcy, the general contractor was unable to complete the project, and defendant thereupon undertook performance as surety.

Thereafter, the GSA discovered a contraction on the roof of said building, which caused leakage and water damage. The gravamen of the complaint is that the defective roof and defendant's subsequent failure to repair said roof constituted a breach of the surety contract and forced the GSA to seek alternative performance after having paid the full contract price. After a circuitous journey ...


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