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BOYD C. WAGNER v. SHAMOKIN AREA SCHOOL DISTRICT AND SHAMOKIN AREA SCHOOL AUTHORITY (10/28/88)

decided: October 28, 1988.

BOYD C. WAGNER, INC., APPELLANT
v.
SHAMOKIN AREA SCHOOL DISTRICT AND SHAMOKIN AREA SCHOOL AUTHORITY, APPELLEES



Appeal from the Order of the Court of Common Pleas of Dauphin County in the case of Boyd C. Wagner, Inc. v. Shamokin Area School District and Shamokin Area School Authority, No. 3468 S 1986.

COUNSEL

Ralph B. Powell, Jr., with him, Richard B. Ashenfelter, Jr., Powell & Liddle, for appellant.

Bruce L. Phillips, Venzie, Phillips & Warshawer, for appellees.

Judges Barry and Smith, and Senior Judge Narick, sitting as a panel of three. Opinion by Judge Barry. Judge MacPhail did not participate in the decision in this case.

Author: Barry

[ 120 Pa. Commw. Page 597]

This case involves an arbitration proceeding between Boyd C. Wagner, Inc. (appellant) and Shamokin Area School District and Shamokin Area School Authority (appellees). The parties entered into a contract in 1975 for appellant to provide architectural and engineering services in connection with the construction of a new school building for appellees. The contract provided for arbitration of disputes but did not specify whether statutory or common law arbitration rules should apply. In 1981 appellee filed a claim with the American Arbitration Association, alleging that appellant had breached the contract, and arbitration proceedings were conducted during 1985 and 1986. Appellee was granted an award in the amount of $520,143.64.

Appellant petitioned the Court of Common Pleas of Dauphin County for review of the award. Appellant requested that the court vacate, modify or correct the award on the grounds that it was contrary to law. He argues that if the award had been a jury verdict the court would have, after a review of the evidence, entered a judgment notwithstanding the verdict. The court dismissed the petition, holding that the narrow scope of review of common law arbitration applied to its review and that it therefore could not use the broader scope of review requested by appellant. Appeal to this court followed.

[ 120 Pa. Commw. Page 598]

In its opinion the trial court cites 42 Pa. C.S. § 7302(a) for the general rule that an agreement to arbitrate a controversy is presumed to be an agreement to arbitrate pursuant to the provisions of common law arbitration, unless the agreement expressly provides for statutory arbitration. The court next cites § 7302(c) which reads:

( c) Government contracts. -- This subchapter shall apply to any written contract to which a government unit of this Commonwealth is a party to the same extent as if the government unit were a private person, except that where a contract to which the Commonwealth government is a party provides for arbitration of controversies but does not provide for arbitration pursuant to any specified statutory provision, the arbitration shall be governed by this subchapter.

Because a contract to which a government unit is a party is treated as if the government unit were a private person, any arbitration proceedings in connection with that contract will be conducted according to common law principles unless the contract expressly provides for statutory arbitration. This result is required by § 7302(a). An exception occurs if the "Commonwealth government" is a party to a contract. In such an instance arbitration must be conducted as statutory arbitration.

The common pleas court recognized the need to decide whether the school district and authority are "government units" or the "Commonwealth government". To do this the court examined the definitions of these terms, plus the definition of "government agency", contained in the definitional section of the Judicial Code. These definitions follow:

'Commonwealth government.' The government of the Commonwealth, ...


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