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RICHLAND SCHOOL DISTRICT ET AL. v. CENTRAL TRANSPORTATION (06/19/89)

decided: June 19, 1989.

RICHLAND SCHOOL DISTRICT ET AL., APPELLANTS,
v.
CENTRAL TRANSPORTATION, INC., A PENNSYLVANIA CORPORATION, APPELLEE



Appeal from Common Pleas Court, Cambria County; Honorable Caram J. Abood, Judge.

COUNSEL

Daniel W. Rullo, Barbera and Barbera, Somerset, for appellants.

William K. Eckel, Johnstown, for appellee.

Barry and Smith, JJ., and Narick, Senior Judge. Smith, J., dissents.

Author: Barry

[ 126 Pa. Commw. Page 660]

OPINION

Richland School District (School District) and six members of its Board of Directors (hereinafter referred to as the Board) appeal from an order of the Court of Common Pleas of Cambria County denying their motion for post trial relief from a decree nisi entered in favor of Central Transportation, Inc. (Central).

The School District had solicited sealed bids for its student transportation services for the school years 1988-89 through 1992-93, along with a two-year option for renewal. In both the notice to bidders and the bidding specifications it reserved the right to reject any and all bids. Central and Lodestar Bus Lines, Inc. (Lodestar) were among those contractors that submitted bids. On February 26, 1988, the bids were opened at a public meeting and it was discovered that Central's bid was the lowest. Thereafter, Lodestar's owner, first orally and later by letter, informed the School District that a clerical error had been committed in the preparation of the bid it had submitted and requested an opportunity to correct that error.*fn1 The correction it sought to make would have resulted in its bid becoming the lowest bid instead of that of Central. The Board did not afford Lodestar the opportunity it requested. However, on March 15, 1988, by a vote of six to three, it authorized the rejection of all bids that had been submitted, the amendment of the bidding specifications and rebidding of the contract.

Thereafter, Central instituted an equity action against the appellants, requesting that they be enjoined from rejecting the bid it had submitted, rebidding the contract and awarding it to any contractor other than itself and that they be

[ 126 Pa. Commw. Page 661]

    directed to accept its bid and enter into a contract with it pursuant to that bid.*fn2 Appellants filed preliminary objections to Central's complaint, by which they challenged its standing to institute the action and contended that an adequate remedy at law existed. Following a hearing, the chancellor entered a decree nisi granting the relief sought by Central. By the same order, it dismissed appellants' preliminary objections. Post-trial motions filed by the appellants were subsequently denied and the decree nisi was affirmed. This appeal followed.

Appellants present two issues for our consideration: (1) Did Central have standing to challenge the Board's decision to reject its bid and require rebidding for student transportation services when it is not a taxpayer of the School District but, however, is a taxpayer of the Commonwealth; and (2) Did the chancellor abuse his discretion in granting the relief requested by Central when he found that the Board's decision to reject all bids and require rebidding of the contract was made in good faith.*fn3

In Weber v. Philadelphia, 437 Pa. 179, 262 A.2d 297 (1970), the Supreme Court summarized the principles of law to be considered by courts when reviewing decisions of municipalities to ...


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