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SOLAR CONSTRUCTION COMPANY v. DEPARTMENT GENERAL SERVICES (05/04/87)

decided: May 4, 1987.

SOLAR CONSTRUCTION COMPANY, INC., PETITIONER
v.
DEPARTMENT OF GENERAL SERVICES, RESPONDENT



Appeal from the Order of the Board of Claims in the case of Solar Construction Company, Inc. v. Commonwealth of Pennsylvania, Department of General Services, Docket No. 881.

COUNSEL

James R. Barozzini, for petitioner.

Thomas M. Devlin, Assistant Counsel, with him, Anthony P. Krzywicki, Chief Counsel, for respondent.

Judges MacPhail and Palladino, and Senior Judge Barbieri, sitting as a panel of three. Opinion by Senior Judge Barbieri.

Author: Barbieri

[ 105 Pa. Commw. Page 610]

Solar Construction Company, Inc. (Solar), appeals here an order of the Board of Claims (Board) dismissing its claim against the Department of General Services (Department) for failing to file its claim within the six-month statute of limitations period. We will affirm.

The facts underlying this case are somewhat complex. The Department and Solar contracted on March 19, 1980, for Solar to perform electrical work at the Western Psychiatric Institute and Clinic in Pittsburgh. The contract was to run two hundred sixty days from the initial job conference to a completion date of January 8, 1981. During the course of the contract, on November 20, 1980, Solar petitioned for relief under Chapter 11 of the Bankruptcy Code*fn1 and was declared a debtor in possession. On April 20, 1981, the Department notified Solar that it had been declared in default on the contract. No further payments were made to Solar after that date and its surety, American Fidelity

[ 105 Pa. Commw. Page 611]

Fire Insurance Company, entered the job site and completed the project. On August 10, 1981, Solar's Chapter 11 bankruptcy proceeding was converted to a Chapter 7*fn2 bankruptcy proceeding and a trustee was appointed. Solar obtained from the bankruptcy trustee permission to file its claim against the Department on November 30, 1982. Solar filed the claim on April 22, 1983. The Department filed preliminary objections to Solar's claim citing, among other things, the statute of limitations. The Board dismissed the preliminary objection based upon the statute of limitations on the ground the Board felt the statute of limitations was properly raisable as an affirmative defense in a responsive pleading and not by preliminary objection. The Department then filed a responsive pleading in which it raised the issue of the statute of limitations as an affirmative defense and moved for Judgment on the Pleadings. The Board denied the Department's motion and Solar was permitted to present its case. On April 17, 1985, at the close of Solar's case, the Department moved to dismiss the claim on the basis of a lack of jurisdiction based upon the statute of limitations. The Board granted the motion and issued a Rule Nisi. On November 12, 1985, the Board made the Rule Nisi absolute and dismissed Solar's claim. This appeal followed.

In this appeal, Solar makes numerous assignments of error that we shall discuss in turn. We are also mindful that pursuant to our limited scope of review under Section 704 of the Administrative Agency Law, 2 Pa. C.S. § 704, we are required to affirm the Board unless necessary findings are unsupported by substantial evidence, an error of law committed, or one of Solar's constitutional rights violated.

[ 105 Pa. Commw. Page 612]

Solar's first contention is that the Board erred in determining its cause of action accrued on April 20, 1981, when the Department notified Solar that it would no longer be paid. Solar contends that the Department waived the statute of limitations by continuing to correspond with it and failing to schedule a pre-claim conference as provided in the construction contract. We agree with the Board that Solar's claim accrued on April 20, 1981, the date the Department declared it in default.

The case law provides that a claim under Section 6 of the Act of May 20, 1937 (Act), P.L. 728, as amended, 72 P.S. § 4651-6, commences at the point a party is capable of formulating the detailed statement of claim required by Section 6. Department of Transportation v. Cumberland Construction Co., 90 Pa. Commonwealth Ct. 273, 494 A.2d 520 (1985), petition for allowance of appeal denied, 513 Pa. 636, 520 A.2d 1386 (1987); Department of Public Welfare v. Federated Security, Inc., 49 Pa. Commonwealth Ct. 411, 411 A.2d 284 (1980). On April 20, 1981, Solar was informed that it would no longer receive any payments under the contract of March 19, 1980. At that point in time, it was capable of computing with sufficient detail any claims it had against the Department since its surety, as of that date, took its ...


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