No. 42 May Term, 1979, Appeal from Order of Commonwealth Court dated April 5, 1979 at No. 37 T.D. 1978, wherein the Commonwealth Court affirmed the Opinion of the Court of Common Pleas of Dauphin County at No. 3661 Equity 1977.
Robert G. Sable, Pittsburgh, for appellant.
Kenneth Makowski, Harrisburg, for appellee.
Eagen, C. J., and O'Brien, Roberts, Nix, Larsen, Flaherty and Kauffman, JJ.
We are asked to decide whether, in a Pennsylvania Liquor Control Board statutory proceeding, an individual who acted as legal counsel to the PLCB may also act as arbitrator. We conclude that the individual so acting may not arbitrate the dispute. Thus we reverse the Commonwealth Court order affirming the arbitration award.
Appellee Pennsylvania Liquor Control Board contracted with appellant Felix Abramovich for the distribution of liquor and supplies in the northwestern region of the Commonwealth. Shortly after the contract was executed, appellant experienced a labor dispute which threatened his ability to perform under the contract. Appellant settled the dispute, but incurred additional labor expenses as a result. Pursuant to paragraph 42 of the contract, appellant sought an adjustment for the increased labor costs.*fn1 The PLCB denied appellant's request.
As required under paragraph 41 of the contract, appellant requested a hearing before the Attorney General.*fn2 The Attorney General appointed appellee, Deputy Attorney General W. W. Anderson, to act as the sole arbitrator of the dispute. Appellant did not know that Anderson was the Deputy Attorney General assigned to the PLCB.
Pursuant to his representation of the Board, Anderson consulted with members of the Board as their legal counsel. Anderson wrote opinions of the Attorney General on issues involving the PLCB. On behalf of the PLCB, Anderson reviewed all contracts exceeding $500,000, like the contract involved here. Finally, Anderson's representation of the Board required him to review and to approve contract language identical to that presently placed in controversy by appellant.
While this arbitration proceeding was pending, Anderson met with the Board's counsel assigned to this case and also met with various employees of the Board. At those meetings Anderson discussed both the possibility of settling this controversy and the financial status of appellant's business. Prior to the arbitration hearing, Anderson failed to disclose this past ...