Coatesville Contractors & Engineers, Inc. v. Borough of Ridley Park

• Decision Date: 19 March 1986
• Citation: 509 Pa. 553,506 A.2d 862
• Parties: COATESVILLE CONTRACTORS & ENGINEERS, INC., Appellant, v. BOROUGH OF RIDLEY PARK, Appellee.
• Court: Pennsylvania Supreme Court

Page 862

506 A.2d 862

509 Pa. 553

COATESVILLE CONTRACTORS & ENGINEERS, INC., Appellant, v. BOROUGH OF RIDLEY PARK, Appellee.

Supreme Court of Pennsylvania.

Argued Dec. 3, 1985.

Decided March 19, 1986.

Eugene H. Jarrell, III, Media, for appellant.

Thomas L. Kelly, Philadelphia, for appellee.

Before NIX, C.J., and LARSEN, FLAHERTY, McDERMOTT, HUTCHINSON, ZAPPALA and PAPADAKOS, JJ.

OPINION OF THE COURT

LARSEN, Justice.

In this appeal we are asked to decide whether the lower court erred in entering a compulsory nonsuit against the appellant, Coatesville Contractors & Engineers, Inc. (Coatesville-appellant) in its action in assumpsit and trespass against appellee, Borough of Ridley Park (Ridley Park-appellee). ¹ Coatesville initiated the action seeking to recover additional compensation in excess of the contract price called for in an excavation contract between the parties. Reviewing the evidence in a light most favorable to the appellant, ² the record establishes the following:

In the summer of 1977, Ridley Park advertised an invitation for bids for certain excavation work to be performed at Ridley Park Lake. ³ Upon learning of the invitation, the appellant, through its agents, made an inspection of the job site in preparation of submitting a bid. The pre-bid on-site inspection revealed an area that was once a lake, but at that time was filled with silt. There was a small stream flowing through the area of silt giving the appearance of a meadow or a field. After making the inspection, appellant prepared and delivered its bid for the excavation job. The bid was submitted on official bid documents provided by appellee. Among other things, the bid documents set forth specifications for the removal of silt from the lake site. Paragraph 1 of the specifications provided:

The lake has been drained and shall remain in the drawdown condition until all silt debris removal work has been completed. The contractor shall remove silt and debris from areas as herein and shown on the plan.

The appellant was the low bidder and was awarded the contract. In November, 1977, after receiving notice of its successful bid, Mr. John Fallon of Coatesville made another inspection of the lake site with a view toward getting the job started. On this second inspection the job site was found to be in a condition similar to that observed at the September pre-bid inspection. The lake bed was still full of silt and the small stream continued to run through the silt area.

In late March, 1978, appellant received notice from Ridley Park to begin work on the job. Responding to the notice, appellant sent workmen to the job site to commence operations. When appellant's workers arrived at the site, it was discovered that the lake was completely filled with water. John Fallon of Coatesville immediately notified the borough engineer, Jack Damon, of the unexpected water condition. Mr. Fallon informed the appellee that appellant had a couple of days work to do in other portions of the job site away from the main body of the lake and could get started on those other areas even though the lake was filled with water. Mr. Fallon indicated, however, that at such time when the appellant's work progressed to the lake, it would be necessary that the appellee have the lake drained of water and kept in the drained condition appellant observed in its September and November inspections, and which was called for by the bid documents and contract specifications. ⁴ Based upon Mr. Fallon's conversations with the borough engineer, appellant reasonably concluded that the appellee would take the steps necessary to remove the water from the lake and work was commenced.

The water remained in the lake throughout the spring and summer of 1978. From time to time, borough employees would go out on the lake in a boat and, with long poles, try to open a valve, ostensibly to accelerate the flow of water out of the lake. These efforts were consistently unsuccessful. Appellant continued on the job during this time and eventually, in early August 1978, considered its performance completed. Appellant billed Ridley Park for an additional $17,000.00 over and above the contract price, most of which had already been paid. The added $17,000.00 represented additional costs allegedly incurred by appellant because the lake was filled with water and remained that way while appellant performed its work under the contract. ⁵ Appellee disputed appellant's assertion that the job was finished and insisted that further work had to be done before the contract was completed. After negotiations between the parties over the question of whether appellant's performance was complete, the appellee agreed to hire a subcontractor to drain the water from the lake. The subcontractor engaged by appellee successfully drained the lake in March, 1979. Appellant returned to the job site after the lake had been drained and did the additional work insisted upon by appellee. Subsequently, Ridley Park refused to pay the invoice for additional expenses in the sum of $17,000.00 and appellant filed suit. At the close of appellant's case, the trial court granted appellee's motion for a compulsory nonsuit. Appellant's timely motions to remove the nonsuit and for a new trial were denied. On appeal, the Superior Court affirmed. Appellant's petition for allowance of appeal to this Court was granted.

The appellee argues that Coatesville is precluded from recovering on any claim for additional compensation by the exculpatory language contained in the contract between the parties. Specifically, appellee relies upon the following contract provisions:

Article II. Payments

3. The Contractor shall not be entitled to demand or receive payments for any work as extra work, unless ordered in writing by the Committee to do the same as such, and at a price fixed by them previously to its commencement.

Article III. Plans and Specifications

2. The Contractor agrees that he has satisfied himself by his own investigation and research regarding all of the conditions affecting the work to be done and labor and material needed, and that his conclusion to execute this contract is based on such investigation and research, and not on the estimate of the quantities or other information prepared by the Engineer, and that he will make no claim against the Municipality because of any of the estimates, tests or representations of any kind affecting the work made by any agent of the municipality may prove to be in any respect erroneous.

Article IV. Progress and Conduct of Work

2. The Contractor shall not be entitled to any claims for damages from any hindrance or delay from any cause whatever in the progress of the work, or any protion thereof, but when such hindrance or delay results from causes entirely beyond the control of the contractor, said hindrance or delay, excepting such as may from time to time result from ordinary and not unusual weather conditions for the season of the year when he is at work, may entitle the contractor to such an extension of time for completing the contract as may be determined by the Committee, provided the contractor shall have given notice in writing of the cause of the detention. (Emphasis supplied.)

7. If any dispute or difference shall arise as to the efficiency of labor, or quality of materials employed or as to the proper execution of the work, they shall be settled by the Committee whose decision shall be final and conclusive.

Article V. Legal Relations and Contractor's Miscellaneous Responsibilities

4. All loss or damages arising out of the nature of the work to be done under the contract, or from any unforeseen obstructions or difficulties which may be encountered in the prosecution of the same, or from the action of the elements, or from encumbrances on the line of the work, shall be sustained by the contractor. (Emphasis supplied.)

The appellant counter-argues that the exculpatory provisions relied upon by the appellee lack validity as a defense to the claim for additional compensation because appellee affirmatively interfered with appellant's performance and failed to act in an essential matter necessary to the prosecution of the work under the contract. Appellant submits that there was sufficient evidence to show both appellee's positive interference and its failure to act in an essential matter.

It has been long settled that a compulsory nonsuit can only be granted in cases where it is clear that a cause of action has not been established. The plaintiff must be given the benefit of all favorable evidence along with all reasonable inferences of fact arising from that evidence. Any conflict in the evidence must be resolved in favor of the plaintiff. Morena v. South Hills Health System, 501 Pa. 634, 462 A.2d 680 (1983); also Ford v. Jeffries, 474 Pa. 588, 379 A.2d 111 (1977); Estate of Dunlap, 471 Pa. 303, 370 A.2d 314 (1977); Yohe v. Yohe, 466 Pa. 405, 353 A.2d 417 (1976); Shirley v. Clank, 441 Pa. 508, 271 A.2d 868 (1970); Flagiello v. Crilly, 409 Pa. 389, 187 A.2d 289 (1963). We must, therefore, review the evidence to determine whether the order entering judgment of compulsory nonsuit was proper.

The rule in Pennsylvania is that exculpatory provisions in a contract cannot be raised as a defense where (1) there is an affirmative or positive interference by the owner with the contractor's work, or (2) there is a failure on the part of the owner to act in some essential matter necessary to the prosecution of the work. Gasparini Excavating Co. v. Pennsylvania Turnpike Commission, 409 Pa. 465, 187 A.2d 157 (1963), See Commonwealth of Pennsylvania State Highway and Bridge Authority v. General Asphalt Paving Company, 46 Pa.Cmwlth. 114, 405 A.2d 1138 (1979). (In spite of contract provisions excluding claims for additional compensation due to delay caused by the owner, contractor awarded additional compensation for three month delay caused by Commonwealth's direct interference in failing to...