Burke v. North Huntingdon Tp.

• Decision Date: 18 November 1957
• Docket Number: 2882
• Citation: 390 Pa. 588,136 A.2d 310
• Parties: Joseph E. BURKE v. The NORTH HUNTINGDON TOWNSHIP MUNICIPAL AUTHORITY, North Huntingdon Township and Municipal Authority of Westmoreland County.
• Court: Pennsylvania Supreme Court

136 A.2d 310

390 Pa. 588

Joseph E. BURKE v. The NORTH HUNTINGDON TOWNSHIP MUNICIPAL AUTHORITY, North

Huntingdon Township and Municipal Authority of Westmoreland County.

No. 2882

Supreme Court of Pennsylvania

November 18, 1957

Argued September 30, 1957

Appeal, No. 232, March T., 1957, from decree of Court of Common Pleas of Westmoreland County, July T., 1956, No. 67 in case of Joseph E. Burke V. The North Huntingdon Township Municipal Authority et al. Decree affirmed.

Assumpsit.

Order entered sustaining preliminary objections by defendants township and county municipal authority, and complaint dismissed as to them, opinion by LAIRD, P.J. Plaintiff appealed.

Decree affirmed. Costs to be paid by appellant.

Christ. C. Walthour, Jr., with him Fred D. Trescher, Frank W. Ittel, Kunkle & Trescher and Reed, Smith, Shaw &amp McClay, for appellant.

Robert W. Smith, Jr. and Joseph M. Loughran, with them Smith, Best and Horn, for appellees.

Before JONES, C. J., BELL, CHIDSEY, ARNOLD, JONES and COHEN, JJ.

OPINION

MR. JUSTICE BENJAMIN R. JONES

Joseph E. Burke and the North Huntingdon Township Municipal Authority (herein called Township Authority), ^[1] on June 3, 1954, entered into a written contract. The Township Authority, intending to enlarge its water works by constructing additional water lines, a filtration plant and a dam, selected Burke as its engineer for the project. Under the contract Burke agreed to furnish and perform certain specified professional engineering services in connection with the project for which the Township Authority agreed to pay him for such services "Six (6%) per Cent of the cost of the construction of the entire water system ...." The total estimated cost of such construction was $760,000.

Almost two years later - May 28, 1956 - the Township Authority sold its water works to the Municipal Authority of Westmoreland County (herein called County Authority) under a contract to which North Huntingdon Township (herein called Township) was a signatory. Paragraph XII of this agreement recites: "The seller and the Township will pay out of the monies paid to them jointly ? [iii] the reasonable fees and expenses of consulting engineers employed by the seller in connection with the transactions contemplated hereby and for past services but not to exceed Twenty thousand ($20,000) Dollars."

Sometime prior to May 28, 1956, the County Authority sent to the Township and the Township Authority a "letter of intent". ^[2] This "letter of intent" contained four provisions presently relevanted a reference to Paragraph XII of the proposed agreement dated but not signed on May 24, 1956, a reference to Burke's claim of $34,200, ^[3] an opinion that Burke's claim was excessive and that its payment should be refused, and a statement, purporting to clarify the parties' understanding under Paragraph XII, that the County Authority "will pay any sums or amounts which you [Township and Township Authority] are found to be responsible to pay, including Mr. Burke's fee, attorney fees, and court costs in excess of $20,000" and, in the event of a settlement, will "pay all amounts agreed upon in excess of $20,000.00".

Burke's claim not having been paid, he instituted an assumpsit action, joining as defendants therein the Township, the Tiwnship Authority and the County Authority. Three causes of action were stated in the Complaint. The cause of action stated against the Township Authority is based upon the contract of June 3, 1954 between the Township Authority and Burke; the cause of action stated against the Township is based upon two grounds: (a) that the Township became liable to Burke by virtue of the provisions of the "Municipality Authorities Act of 1945", providing for the assumption of an Authority's projects by the municipality which created it and (b) under the terms of the contract of May 28, 1956 between the Township Authority and the County Authority to which the township was a signatory; the cause of action stated against the County Authority is based upon the terms of the same contract between the Township Authority, the County Authority and the Township.

The Township Authority having filed an answer upon the merits, the question of its liability to Burke is not presently at issue.

Both the Township and the County Authority filed separate preliminary objections each of which raised two questions of law: (a) that the Township and County Authority were improperly joined as parties defendant and (b) that Burkd's complaint failed to set forth a cause of action against either the Township or the County Authority. The court below sustained the preliminary objections and directed that plaintiff's complaint as to the Township and the County Authority be stricken. From that decree this appeal was taken.

The procedure for the joinder of defendants is prescribed by Pa. R.C.P. 2229, subsections (b) and (d), which read as follows: (b) "A plaintiff may join as defendants persons against whom he asserts any right to relief jointly, severally, separately or in the alternative, in respect of or arising out of the same transaction, occurrence, or series of transactions or occurrences if any common question of law or fact affecting the liabilities of all such persons will arise in the action. ... (d) A person who asserts a cause of action ex contractu may join as defendants all or any one or more persons alleged to be liable to him on or by reason of the breach of the contractual obligation sued upon, regardless of the capacities in which such persons are respectively liable or whether they are primarily or secondarily liable or whether their liabilities arise from the same or separate acts or undertakings; ...."

While the complaint states three different causes of action, yet all the causes of action arise out of the "same transaction" and a "common question of law and fact affecting the liabilities" of all three defendants will arise in the action. ^[4] The three defendants have been properly joined. ^[5] Each of plaintiff's causes of action is sufficiently common to the other causes of action as to constitute a related series of actions.

The complaint as against the Township states two causes of action each of which will be discussed separately.

Section 18 of the Municipality Authroties Act of 1945, supra, as amended, 53 PS § 2900z-19 provides: "(A) If a project shall have been established under this act by a board appointed by a municipality or municipalities, which project is of a character which the municipality or municipalities have power to establish, maintain or operate, and such municipality or municipalities desire to acquire the same, it or they may by appropriate resolution or ordinance adopted by the proper Authorities, signify its or their desire to do so, and thereupon the [Authority], shall convey by appropriate instrument said project to such municipality or municipalities, upon the assumption by the latter of all the obligations incurred by the Authorities with respect to that project." Burke contends that the Township, by signing the contract of May 28, 1956, in effect acquired the water works under this statute and therefore assumed the Authority's obligations with respect to this project.

This statutory provision outlines the method to be pursued where a municipality - the Authority's creator - desires to acquire a project of the Authority; it must be accomplished by an appropriate resolution or ordinance adopted by the Authority. In Carpenter v. Yeadon Borough, 208 Pa. 396, 399, 57 A. 837, we stated: " The authority of a municipal body to legislate or to contract is conferred by the lawmaking power of the state, hence it must be exercised in the manner provided in the statute conferring it. A municipal corporation is simply the agent or instrumentality of the state to administer local government and to exercise certain powers and to perform certain duties within defined territorial limits in conformity with the method and to the extent delegated in the legislation creating and applicable to the corporation. Its contractual powers are derived from the same source and are circumscribed by the same limitations." See also: Meixell v. Hellertown Borough Council, 374 Pa. 412, 417, 418, 97 A.2d 822; Coyle v. Pittsburgh, 344 Pa. 426, 427, 428, 25 A.2d 707; Miners Savings Bank of Pittston v. Duryea Borough, 331 Pa. 458, 462, 200 A. 846; Philadelphia Co. v. City of Pittsburgh, 253 Pa. 147, 152, 97 A. 1083.

In Harris v. Philadelphia et al., 283 Pa. 496, 503, 129 A. 460, it was stated: "It has been uniformly held, and may now be regarded as the general rule in this State, that, where a statute provides a method or formal mode of making municipal contracts, such provision is mandatory and must be observed, otherwise the contract is not enforceable against the municipality ...." See also: Luzerne Township v. Fayette County, 330 Pa. 247, 251, 252, 199 A. 327; Wilkes-Barre Connecting Railroad Co. v. Kingston Borough, 319 Pa. 471, 474, 181 A. 564; Stange et al. v. Philadelphia, 308 Pa. 339, 343, 162 A. 833.

No resolution or ordinance having ever been adopted by the instant Authority there could be no acquisition of any project of the Authority by the municipality. To hold otherwise would be to ignore completely the statutory mandate. The bare execution by the municipality of the contract between the Township Authority and the County Authority cannot be substituted for the requisite "resolution or ordinance of the Authority." We cannot satisfy the statutory mandate by a fiction, to wit that because the Township signed the agreement it necessarily must have acquired the project of the Authority. The Township's execution of the agreement between the Township Authority and the County Authority was simply a...