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COMMONWEALTH PENNSYLVANIA v. MANOR MINES (10/18/89)

decided: October 18, 1989.

COMMONWEALTH OF PENNSYLVANIA, DEPARTMENT OF TRANSPORTATION, APPELLEE,
v.
MANOR MINES, INC., AND THE TRAVELERS INDEMNITY COMPANY, APPELLANTS



Appeal from the Order of the Commonwealth Court entered on June 28, 1988, at No. 231 C.D. 1982 denying the Motion for Post-trial Relief. Nix, C.j., and Larsen, Flaherty, McDermott, Zappala and Papadakos, JJ.

Author: Nix

[ 523 Pa. Page 113]

OPINION

In this case the Pennsylvania Department of Transportation ("PennDOT") invoked the Commonwealth Court's original jurisdiction through a complaint filed seeking to recover sums due the Department under a heavy hauling agreement executed between PennDOT and the appellant, Manor Mines, Inc. ("Manor"). The issues before this Court are essentially matters of contractual interpretation and the

[ 523 Pa. Page 114]

    sufficiency of the pleadings, because the basic underlying facts are uncontroverted. Specifically, appellants suggest that the Commonwealth Court's improper interpretation of the agreement allowed PennDOT recovery on the theory of strict liability when Manor was only accountable for the damage it actually caused. Also, the appellants maintain that the Commonwealth Court should have precluded PennDOT from using a strict liability theory because that theory materially varied from the pleadings. The appellants argue that such a variance between the proofs and the pleadings created an undue prejudice against them.

The facts in this case are that appellant Manor operated a bituminous coal mine facility ("Manor 8"), the portal for which was located on Pennsylvania Legislative Route 32074 ("L.R. 32074") in Washington Township, Indiana County. Manor transported the coal produced at this facility over L.R. 32074 for approximately 3.71 miles. On or about April 21, 1976, PennDOT posted a ten-ton weight restriction on L.R. 32074. In order to continue the hauling of coal in excess of the posted weight restriction, Manor and PennDOT entered into a Heavy Hauling Agreement ("Agreement") on or about June 8, 1976. A copy of that agreement is attached and identified as Appendix "A". An integral part of this agreement was a $74,000 surety bond posted by appellant, Travelers Indemnity Company ("Travelers") on behalf of Manor.

The Agreement permitted Manor to transport loads of coal in excess of the ten-ton weight limit in exchange for Manor's obligation to pay for the cost of the necessary repairs to the roadway. Pursuant to the Agreement, Manor and PennDOT jointly performed a preliminary inspection of the roadway prior to Manor's obligation under the Agreement.*fn1 The Agreement further provided for a system of

[ 523 Pa. Page 115]

    periodic inspections of the road*fn2 and a method of determining the extent of the necessary repairs to be covered by the Agreement.*fn3

Between June 1976 and March 1981, Manor produced 373,340 tons of coal and transported that coal over L.R. 32074.*fn4 In September of 1981, after learning that Manor had ceased its hauling operations on L.R. 32074, PennDOT performed a final inspection of the roadway pursuant to paragraph seven of the Agreement. Subsequently, PennDOT contractors performed all the necessary repairs noted in the final inspection report and PennDOT billed Manor for

[ 523 Pa. Page 116]

    the costs. Manor refused to accept responsibility for the costs and this litigation ensued.

In its original complaint, PennDOT relied solely upon the strict liability theory contained in the Agreement itself for recovery of the cost of repairs.*fn5 Manor filed an answer and new matter alleging that it was only liable for the damages actually caused by its overweight hauling. PennDOT responded to the new matter allegations by admitting that Manor was responsible for the damages specifically caused by them. However, PennDOT also filed an amended complaint reasserting its strict liability theory thus indicating it was not abandoning the strict liability theory of recovery.

The Commonwealth Court, in its original jurisdiction, determined that a strict liability theory of recovery was sufficiently averred in PennDOT's complaint and amended complaint to avoid preclusion of that issue. That court also found the unambiguous language of the Agreement to indicate that strict liability was intended, thereby eliminating the need for any evidence relating to the issue of causation. Finally, the Commonwealth Court found that the attorneys' fees included in the performance bond were not limited to a confessed judgment proceeding and were therefore appropriate in light of Manor's clear default on payment. 117 Pa. Commw. 342, 544 A.2d 538.

In this direct appeal, pursuant to Rule 1101(a)(1), of the Pennsylvania Rules of Appellate Procedure, Pa.R.App.P., Manor and Travelers seek to have this Court reverse the Commonwealth Court's conclusion that the strict liability theory was sufficiently alleged in PennDOT's pleadings. The appellants argue that because PennDOT replied to certain paragraphs in the new matter pleading, allegedly relating to Manor being responsible for only the damages attributable to their use, with asserted unqualified admissions, PennDOT should have been estopped from continuing

[ 523 Pa. Page 117]

    on a strict liability theory. Appellants contend that they relied on the "admissions" of PennDOT with respect to causation and abandoned any preparation or discovery on the issue of strict liability. The appellants contend that such a detrimental reliance in view of the elapsed time and subsequent death of key witnesses on that issue irreversibly prejudiced their defense.

Furthermore, appellants are seeking to challenge the Commonwealth Court's interpretation of the hauling agreement and of the performance bond posted by Travelers. First, appellants argue that the Agreement does not specifically provide for strict liability. Also, they contest the award for attorneys' fees pursuant to the performance bond after this protracted proceeding, arguing that such fees were limited to a confessed judgment proceeding. Considering the limited review of these issues*fn6 and the lower court's proper interpretation of those agreements, it is clear that the order and judgment in favor of PennDOT should be affirmed.

This Court has long recognized the need for conformity between the pleadings of an action and the proofs presented at trial. Knox v. Simmerman, 301 Pa. 1, 151 A. 678 (1930). Such a rule is essential to protect a defendant against an unfair surprise at the time of trial as well as to allow him to formulate a proper defense to the stated cause of action. Socha v. Metz, 385 Pa. 632, 641, 123 A.2d 837, 841 (1956). The statement of the court in Aland v. P-G Publishing, 337 Pa. 259, 263, 10 A.2d 5, 7 (1940), is as applicable today as it was nearly 50 years ago: "[d]espite the increasing informality of modern practice, there has been no substantial departure from the salutary rule ...


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