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A. Scott Enterprises, Inc. v. City of Allentown

Commonwealth Court of Pennsylvania

October 21, 2014

A. Scott Enterprises, Inc.
v.
City of Allentown, Appellant; A. Scott Enterprises, Inc., Appellant
v.
City of Allentown

Argued September 11, 2014

Page 1061

Appealed from No. 2011-C-2818. Common Pleas Court of the County of Lehigh. Varricchio, J.

James T. Huber, Allentown, for designated appellant City of Allentown.

Frank Nofer, King of Prussia, for designated appellee A Scott Enterprises, Inc.

BEFORE: HONORABLE MARY HANNAH LEAVITT, Judge, HONORABLE PATRICIA A. McCULLOUGH, Judge, HONORABLE ROCHELLE S. FRIEDMAN, Senior Judge.

OPINION

Page 1062

MARY HANNAH LEAVITT, Judge

The City of Allentown (City) appeals an order of the Lehigh County Court of Common Pleas (trial court) entering a judgment in favor of A. Scott Enterprises, Inc. (Contractor) on its breach of contract action and denying the City's motion for a new trial. The trial court awarded Contractor $929,299 in damages, but Contractor argues that it was also entitled to penalties, attorney's fees and interest and, therefore, has cross-appealed. We affirm in part and reverse and remand in part.

Background

Contractor was the successful bidder on the City's planned two lane, one mile roadway called " New England Avenue." The bid price was $2,949,760 and was to be 100 percent paid by the Pennsylvania Department of Transportation (PennDOT) with funds it received from the Federal Highway Administration. Accordingly, PennDOT was responsible for ensuring that the project complied with all applicable state and federal specifications. To that end, PennDOT has issued " Publication 408," which sets forth the specifications for all its construction projects. The project's bid documents did not disclose the possibility of hazardous materials at the project site even though the City's consultant, Michael Baker, Jr., Inc. (Baker) had advised the City of this possibility. The City did not test for hazardous contaminated soil. The project was expected to be completed by October of 2010.

The agreement between the City and PennDOT provided for PennDOT's reimbursement of invoices submitted by the City. However, that agreement exempted late charges and environmental problems from reimbursement unless attributed to PennDOT's acts or omissions. Specifically,

Page 1063

the agreement stated that PennDOT would not reimburse ...


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