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STATE PUBLIC SCHOOL BUILDING AUTHORITY v. W.M. ANDERSON COMPANY (02/22/80)

decided: February 22, 1980.

STATE PUBLIC SCHOOL BUILDING AUTHORITY, PETITIONER
v.
W.M. ANDERSON COMPANY, RESPONDENT



Appeal from the Order of the Board of Claims in case of W.M. Anderson Company v. Commonwealth of Pennsylvania, State Public School Building Authority, Docket No. 478.

COUNSEL

James R. Clippinger, for petitioner.

Malcolm L. Lazin, of Fell, Spalding, Goff & Rubin, for respondent.

Judges Rogers, Blatt and MacPhail, sitting as a panel of three. Opinion by Judge Blatt. This decision was reached prior to the death of President Judge Bowman. Judge DiSalle did not participate in the decision in this case.

Author: Blatt

[ 49 Pa. Commw. Page 421]

This is an appeal from an order of the Board of Claims (Board) which awarded damages to W.M. Anderson Co., Inc. (respondent) in restitution for uncompensated electrical work which the respondent furnished for the petitioner, the State Public School Building Authority (School Authority). The controversy arose out of a contract between the School Authority and the respondent for wiring for a School Authority building project.

In February of 1976, a dispute arose between the respondent and another electrical wiring contractor involved in the same project here concerned regarding who was obligated to install certain wiring. After meeting with both contractors and reviewing the terms of the contract, the School Authority directed the respondent to install the wiring, and, in complying with this order, the respondent incurred an expense to itself of $25,348.54. This expense was unusually high because the respondent installed an additional wiring conduit rather than using an existing conduit which had been installed by the other contractor for the wiring it did. Having been refused compensation by the School Authority for this extra expense, the respondent appealed to the Board and the Board ordered the School Authority to pay restitution damages of $25,348.54. The School Authority does not now contest the Board's interpretation of the contract, but contends only that the Board had no

[ 49 Pa. Commw. Page 422]

    jurisdiction over the contract dispute or, in the alternative, that the Board should have found that the respondent incurred an unnecessary expense in installing the conduit and unreasonably failed to mitigate the loss incurred.

The School Authority contends first that its resolution of the dispute was a discretionary governmental act, much like its awarding of contracts pursuant to competitive bidding, and that such a discretionary act cannot be overturned absent a showing of fraud, collusion or bad faith. We find no merit to this argument. It is incontrovertible, of course, that the Commonwealth has waived its immunity to suit for actions arising out of contract,*fn1 and we have consistently held that the Board has exclusive jurisdiction over contract actions against the Commonwealth. Vespaziani v. Department of Revenue, 40 Pa. Commonwealth Ct. 54, 396 A.2d 489 (1979). We note with regard to discretionary actions of agents of the Commonwealth that Section 5110(b)(3) of the Judicial Code, 42 Pa. C.S. § 5110(b)(3), provides that the Commonwealth can provide that certain acts be carried out in the discretion of its agents, but we can find no provision in the State Public School Building Authority Act, Act of July 5, 1947, P.L. 1217, as amended, 24 P.S. § 791.1 et seq., providing the School Authority with such discretion or limiting our scope of review over suits involving contracts with the School Authority.

As for the mitigation of damages, the School Authority contends that, after it directed the respondent to complete the wiring, a further dispute arose concerning the respondent's use of the existing conduit and, for reasons which are unclear, the respondent

[ 49 Pa. Commw. Page 423]

    installed a second conduit. The School Authority argues that the respondent's failure to notify the School Authority of the dispute with the other contractor, as required by the contract for arbitration purposes, ...


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