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decided: November 18, 1982.


Appeal from the Order of the Department of Transportation in case of In Re: Prequalification Suspension of E. Smalis Painting Company, Inc., No. 7 A.D. 81.


Wendell G. Freeland, Freeland & Kronz, for petitioner.

Gregory C. Santoro, Assistant Counsel, with him Ward T. Williams, Chief Counsel, and Jay C. Waldman, General Counsel, for respondent.

Judges Blatt, Craig and MacPhail, sitting as a panel of three. Opinion by Judge Craig.

Author: Craig

[ 70 Pa. Commw. Page 91]

In this contractor suspension case, E. Smalis Painting Company appeals from a decision by the Department of Transportation, holding in abeyance the award of a February 1981 contract to the company and suspending the firm from bidding on any future work.

[ 70 Pa. Commw. Page 92]

Under regulations*fn1 which require a contractor to (1) submit a statement of all felony convictions of its directors, principal officers, and key employees [67 Pa. Code § 457.4(e)]*fn2 and (2) notify DOT in writing of a change in such information or suffer possible suspension [67 Pa. Code § 457.16],*fn3 the department took action against the contractor after an assistant district attorney for Allegheny County, and not the company, informed DOT's Office of Inspector General that Ernest Smalis, president and major shareholder of the firm, "had been convicted of certain crimes in a court of competent jurisdiction and was awaiting sentence pending a pre-sentence investigation."*fn4

[ 70 Pa. Commw. Page 93]

The administrative hearing officer, an assistant counsel to the department appointed by the Secretary of Transportation, decided that the Court of Common Pleas of Allegheny County had "convicted" Mr. Smalis of a felony within the meaning of Section 457.4(e) and that, consequently, DOT justifiably had suspended the company's contracts for failing to report a change in its president's penal status.

The petitioner contends, however, that because the court had not yet imposed sentence upon Mr. Smalis, the company had no obligation to submit a statement of conviction under Section 457.4(e). We disagree.

Both parties concur that this case turns on the proper definition of "conviction," as found in DOT's regulations, and that, in Pennsylvania, the word "conviction" has a common or popular as well as a technical or legal meaning. Commonwealth v. Minnich, 250 Pa. 363, 366, 95 A. 565, 566 (1975).

"As commonly understood, it means a verdict of guilty, or perhaps a plea of guilty, and for some purposes this is the meaning attributed to it by the courts. . . . For other purposes it has been held to imply 'judgment' or 'sentence,' upon the verdict of plea. . . ."

Bycer v. State Board of Pharmacy, 57 Pa. Commonwealth Ct. 205, 210, 425 A.2d 1213, 1216 (1981), quoting Commonwealth v. Palarino, 168 Pa. Superior Ct. 152, 77 A.2d 665 (1951).

Moreover, as our Supreme Court has instructed in Minnich, we are to give the term its technical meaning "except where such construction would defeat the apparent

[ 70 Pa. Commw. Page 94]

    intention in using it." 250 Pa. at 368, 95 A. at 567.

Here, by authority of his appointment under the Administrative Law*fn5 and 1 Pa. Code Chapter 35, the hearing officer considered the meaning of "conviction," as found in Code Section 457.4(e), and concluded that the term merited the popular interpretation rather than a technical construction.*fn6 In other words, he apparently concluded that giving the word "conviction" its technical meaning "would defeat the [department's] apparent intention in using it." Minnich.

Because an administrative agency's interpretation of its own regulation is controlling unless (1) that interpretation is plainly erroneous or inconsistent with the regulation or (2) the regulation is inconsistent with the statute under which it is promulgated, Barr v. Department of Public Welfare, 62 Pa. Commonwealth Ct. 211, 435 A.2d 678, 680 (1981), citing Department of Public Welfare v. Forbes Health System, 492 Pa. 77, 422 A.2d 480 (1980), and because we can find nothing plainly erroneous or inconsistent with DOT's interpretation of the word "conviction," we affirm.

Indeed, the hearing officer's interpretation of "conviction" squares with other regulatory provisions promulgated by the department under 36 P.S. § 670-404.1*fn7

[ 70 Pa. Commw. Page 95]

    to ensure that bidders on highway projects are "competent and responsible."

We note, for example, that one of the stated purposes of the regulations is "[t]o assure the integrity and competence of all bidders"*fn8 and that DOT has attempted to effectuate the purpose of the Act via regulations by requiring prospective contractors to file extensive statements, under oath, detailing inter alia their financial and plant resources, their record of minority hirings, and "related pertinent and material information necessary to establish competency and responsibility"*fn9 and by empowering the Secretary to suspend temporarily or disqualify any prospective bidder, previously qualified, for "[u]nlawful or improper activities that render the prospective bidder unacceptable,"*fn10 or for "any other valid reason or cause."*fn11

Moreover, the regulations require, under penalty of suspension for non-compliance, that all contractors notify DOT promptly not only of misdemeanor or felony convictions but of "any significant changes affecting their capacity."*fn12

Clearly, then, the Act vests DOT with broad powers to ensure the integrity of its private contractors,

[ 70 Pa. Commw. Page 96]

    with the regulations reflecting that goal through a system of notification when significant changes occur. Because we are confident that the hearing examiner's interpretation of "conviction" comports with the purpose of the Act and the department's implementing regulations, we affirm.


Now, November 18, 1982, we hereby affirm the order of the Department of Transportation suspending E. Smalis Painting Co., Inc. as a prequalified bidder.



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