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COMMONWEALTH PENNSYLVANIA v. CUMBERLAND CONSTRUCTION COMPANY (06/20/85)

decided: June 20, 1985.

COMMONWEALTH OF PENNSYLVANIA, DEPARTMENT OF TRANSPORTATION, PETITIONER
v.
CUMBERLAND CONSTRUCTION COMPANY, RESPONDENT. CUMBERLAND CONSTRUCTION COMPANY, PETITIONER V. COMMONWEALTH OF PENNSYLVANIA, DEPARTMENT OF TRANSPORTATION, RESPONDENT



Appeals from the Order of the Board of Claims in the case of Cumberland Construction Company v. Commonwealth of Pennsylvania, Department of Transportation, No. 458.

COUNSEL

John J. Buchy, Jr., Assistant Counsel, with him, Spencer A. Manthorpe, Chief Counsel, and Jay Waldman, General Counsel, for petitioner/respondent, Department of Transportation.

Thomas A. Beckley, with him, Jeffrey W. Davis, Beckley & Madden, for petitioner/respondent, Cumberland Construction Company.

Judges Rogers and Barry and Senior Judge Barbieri, sitting as a panel of three. Opinion by Senior Judge Barbieri.

Author: Barbieri

[ 90 Pa. Commw. Page 275]

This is a consolidated appeal from an order of the Board of Claims (Board) which resulted from a claim filed by Cumberland Construction Company (Cumberland) against the Pennsylvania Department of Transportation (PennDOT) for additional work it performed in connection with Contract No. 20106. Cumberland appealed from that portion of the Board's order which denied its claim for damages and additional compensation in connection with that contract. PennDOT appealed from that portion of the Board's order which awarded Cumberland additional compensation for additional work performed in connection with that contract and from that portion of the Board's order which directed PennDOT to pay over to Cumberland the sum it had previously withheld as liquidated damages. We affirm the order of the Board.

The factual background of this case may be summarized as follows. In May 1973, PennDOT advertised for bids on Contract No. 20106. This contract called for the construction of two roadside rest areas along Interstate Route 80 in Greene Township, Clinton County. The work to be performed included the construction of ramps, parking areas, buildings, sewage

[ 90 Pa. Commw. Page 276]

    and water systems, power supplies, highway lighting and appurtenances, and some landscaping. Cumberland submitted the low bid and was awarded the contract on June 28, 1973, although the contract was not actually signed until July 10, 1973. As a result of unusual subsurface conditions, consisting primarily of quicksand and large boulders, Cumberland was required to perform additional work in order to complete the contract. Some of this additional work was performed at PennDOT's direction while other additional work was undertaken by Cumberland on its own, presumably dictated by the conditions found at the site. The existence of these unusual subsurface conditions was not known to Cumberland but was previously known to PennDOT. PennDOT did not inform Cumberland of these conditions prior to the commencement of work. PennDOT also agreed to make regular progress payments under the contract. These progress payments, however, were made irregularly and in September 1974 Cumberland experienced an acute cash-flow problem and obtained the cash necessary to complete the project from its bonding company. The bonding company subsequently sold off much of Cumberland's equipment to recover the funds it advanced to complete the project and Cumberland eventually ceased doing business as a result.

The project was completed by Cumberland on July 29, 1975 and it received PennDOT's "tentative quantities"*fn1 in mid-December 1975, which enabled it to calculate with some degree of specificity what it was due. Cumberland filed its complaint with the Board

[ 90 Pa. Commw. Page 277]

    on January 29, 1976. Twenty-four hearings were held between September 19, 1979 and October 16, 1981. On July 5, 1983, the Board entered its final order which sustained several of Cumberland's claims and directed PennDOT to pay to Cumberland $11,500 which it had withheld as liquidated damages. The Board denied Cumberland's claim for consequential and punitive damages against PennDOT for the destruction of its business and denied the claim for additional compensation for a quantity of rock used in the performance of the contract. Both Cumberland and PennDOT appealed that order.

In its appeal, PennDOT initially contends that Cumberland's complaint was not filed with the Board in a timely manner and that the Board, therefore, was without jurisdiction to hear the claim. PennDOT also contends that the Board erred in finding that Cumberland was entitled to additional compensation for work performed under, but not specified in, the contract, and that the Board erred in directing PennDOT to pay over to Cumberland the $11,500 it had withheld as liquidated delay damages. Cumberland contends that the Board erred in denying its claim for consequential and punitive damages resulting from PennDOT's failure to make timely progress payments and in ruling that it was not entitled to the contract unit price for Selected Borrow Excavation -- Special of $175 per cubic yard ...


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