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LUTZ APPELLATE PRINTERS v. COMMONWEALTH PENNSYLVANIA (07/05/79)

decided: July 5, 1979.

LUTZ APPELLATE PRINTERS, INC., APPELLANT,
v.
COMMONWEALTH OF PENNSYLVANIA, DEPARTMENT OF PROPERTY AND SUPPLIES AND RONALD G. LENCH, SECRETARY, DEPARTMENT OF PROPERTY AND SUPPLIES, COMMONWEALTH OF PENNSYLVANIA AND MILTON J. SHAPP, GOVERNOR, COMMONWEALTH OF PENNSYLVANIA AND ROBERT P. CASEY, AUDITOR-GENERAL, COMMONWEALTH OF PENNSYLVANIA AND GRACE M. SLOAN, STATE TREASURER, COMMONWEALTH OF PENNSYLVANIA



No. 243 January Term, 1977, On Appeal from the Decree of the Commonwealth Court Entered December 22, 1976, at No. 1428 C.D. 1976.

COUNSEL

Lewis Kates, Kates & Livesey, Philadelphia, for appellant.

Howard M. Snyder, Deputy Atty. Gen., David H. Allshouse, Harrisburg, for Milton J. Shapp and Grace M. Sloan.

Michael Jon Daley, Asst. Atty. Gen., T. A. Adler, Deputy Atty. Gen., Harrisburg, for Dept. of Properties and Supplies.

Robert P. Meehan, Frank P. Lawley, Harrisburg, for Robert P. Casey.

John L. Sweezy, Asst. Atty. Gen., Harrisburg, for Ronald G. Lench.

Eagen, C. J., and O'Brien, Roberts, Nix, Manderino and Larsen, JJ. Nix, J., concurs in the result. Larsen, J., dissents and would affirm the decree of the Commonwealth Court based on Section 523 of the Administrative Code of 1929.

Author: Roberts

[ 485 Pa. Page 562]

OPINION OF THE COURT

Appellee, the Commonwealth's Department of Property and Supplies, invited bids on a one-year contract for the printing of legal briefs and records. The lowest bid was submitted by appellant, Lutz Appellate Printers, Inc., a New Jersey printer which does business in Pennsylvania, but the Department awarded the contract to the next lowest bidder. The Secretary of the Department decided that an award to Lutz is barred by Section 523 of the Administrative Code of 1929.*fn1 Lutz, a Pennsylvania taxpayer, filed a complaint in the Commonwealth Court against the Department, its Secretary, the Governor, Auditor General, and State Treasurer. Lutz alleged the Secretary misconstrued Section 523 of the Code, Lutz was the "lowest responsible bidder," and the Secretary was obliged to award the contract to Lutz. Lutz

[ 485 Pa. Page 563]

    sought a declaration that it is the lowest responsible bidder and an injunction prohibiting appellees from awarding the contract to anyone other than Lutz. On preliminary objections in the nature of a demurrer, the Commonwealth Court dismissed Lutz's complaint. 28 Pa. Commw. 7, 367 A.2d 374 (1976). The Commonwealth Court concluded that because Lutz did not allege "fraud or collusion," Lutz failed to state a cause of action.

We agree with Lutz that "fraud or collusion" need not be alleged to set forth an actionable claim and that a cause of action has been stated. We also agree with the Auditor General that he is not a proper party to this proceeding and conclude the complaint against him was properly dismissed. In all other respects, the dismissal of the complaint is reversed.

I

The Governor and Treasurer first dispute the standing of Lutz to challenge the Department's award. This contention was presented, considered, and unanimously rejected in Lutz Appellate Printers, Inc. v. Department of Property and Supplies, 472 Pa. 28, 370 A.2d 1210 (1977) (Lutz I). There, this Court held:

"A taxpayer has standing to enjoin the award of a public contract to anyone other than the lowest responsible bidder. See Heilig Brothers Co. v. Kohler, 366 Pa. 72, 76 A.2d 613 (1950). Lutz is also a disappointed bidder, but this does not affect its standing as a taxpayer. Id. Similarly, Lutz's request for declaratory relief that it is the lowest responsible bidder does not alter its standing as a taxpayer to enjoin the award of a public contract."

472 Pa. at 33, 370 A.2d at 1212 (footnote omitted). In Drummond v. Drummond, 414 Pa. 548, 551, 200 A.2d 887, 888 (1964), this Court concluded that an adjudication of objections to jurisdiction in an appeal permitted by the Act of March 5, 1925, P.L. 23, § 1, 12 P.S. § 672, establishes "the law of the case as to all ...


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