Opinion
November 22, 1976.
Board of Arbitration of Claims — Exclusive jurisdiction — Act of 1937, May 20, P.L. 728 — Waiver of sovereign immunity — Public contract.
1. Under the Act of 1937, May 20, P.L. 728, the Board of Arbitration of Claims has exclusive jurisdiction over claims against the Commonwealth arising from contracts, and in waiving its immunity from such contract suits the Commonwealth limited the waiver and permitted such action to be brought only in that forum. [205-6]
2. The Board of Arbitration of Claims has exclusive jurisdiction over an action involving a dispute between parties to a contract to which the Commonwealth is also a party. [206]
Submitted on briefs, October 5, 1976, to President Judge BOWMAN and Judges CRUMLISH, JR., WILKINSON, JR., MENCER, ROGERS and BLATT. Judge KRAMER did not participate.
Appeal, No. 90 Misc. Dkt., from the Order of the Court of Common Pleas of Philadelphia County in case of Selby Battersby Company v. Van Cor, Inc. and Aetna Casualty Surety Company and Pennsylvania College of Podiatric Medicine and The General State Authority, No. 1693 April Term, 1974.
Complaint in assumpsit in the Court of Common Pleas of Philadelphia County. Defendant filed third party complaint. Third party defendant, General State Authority, filed preliminary objections. Preliminary objections overruled. O'NEILL, J. General State Authority appealed to the Commonwealth Court of Pennsylvania. Held: Reversed. Third party complaint against General State Authority dismissed.
Michael A. Madar, Chief Counsel, with him Arnold L. Wainstein, Assistant Counsel, and Richard D. Holahan, Assistant General Counsel, for appellant.
Jerome Poltenstein, for appellees.
The appellee, Van Cor, Inc., a builder, entered into a contract with the Pennsylvania College of Podiatric Medicine on January 28, 1971 to construct a building. On April 26, 1971, the appellee entered into a subcontract with the plaintiff below, Selby Battersby Company, for the construction of certain flooring in the subject building. With the consent of Van Cor, Inc. the Pennsylvania College of Podiatric Medicine assigned its rights under the contract to the appellant, The General State Authority (GSA). Selby Battersby Company sued Van Cor, Inc. in assumpsit in the Court of Common Pleas of Philadelphia County seeking damages for improper performance. Van Cor, Inc. then sought to join the College and GSA as additional defendants by filing third party complaints against each. It seeks judgment against GSA in excess of $238,000 for money allegedly due it by contract and unpaid by GSA.
The functions, powers and duties of The General State Authority were transferred to the Department of General Services by the Act of July 22, 1975, P.L. 75.
This is GSA's appeal from an order of the Common Pleas Court of Philadelphia County dismissing GSA's preliminary objections to Van Cor, Inc.'s complaint against GSA. GSA says that the Common Pleas Court of Philadelphia County has no jurisdiction because Section 4 of the Board of Arbitration of Claims Act gives exclusive jurisdiction of all claims against the Commonwealth arising from contracts to the Board of Arbitration of Claims. We agree, as we have previously. Kreider v. Commonwealth, 9 Pa. Commw. 491, 308 A.2d 642 (1973).
The Act of May 20, 1937, P.L. 728, § 4, as amended, 72 P.S. 4651-4, states: "The Board of Arbitration shall have jurisdiction to hear and determine all claims against the Commonwealth arising from contracts hereafter entered into with the Commonwealth, where the amount in controversy amounts to $300.00 or more."
"The Commonwealth of Pennsylvania is a sovereign entity and can be sued only as it consents to be." Alger-Rau Associates, Inc. v. General State Authority, 7 Pa. Commw. 71, 73, 298 A.2d 916, 917 (1973). When waiving its immunity with respect to contracts, the Commonwealth created statutory limitations, one of which was the establishment of the Board of Arbitration of Claims as the forum for such suits. In the instant case, Van Cor, Inc. consented to the College's assignment of the contract to The General State Authority in an agreement which stated in part:
And the undersigned contractor hereby agrees that in the case of all questions and disputes arising between The General State Authority and the Contractor respecting any matter pertaining to said contract or any part thereof, or any breach of said contract arising thereunder, shall be determined by the Board of Arbitration of Claims created by Act No. 193, approved May 20, 1937, P.L. 728, 72 P.S. 4651, its supplements and amendments and in the manner and under the terms and condition as provided therein.
Van Cor, Inc. could not have brought an original action against GSA on its claim as stated in the Court of Common Pleas. It cannot bring an action in that court for the same cause by joining GSA as an additional defendant:
A dispute between the contractor and subcontractor to a contract of which the Commonwealth is also a party necessarily affects the Commonwealth, and falls within the jurisdiction of the Board of Arbitration of Claims to arbitrate claims 'against the Commonwealth arising from contracts [hereafter] entered into [with] the Commonwealth.'
"Act of May 20, 1937, P.L. 728, as amended, 72 P. S. § 4651-1."
Brocker Manufacturing Supply Company, Inc. v. United Bonding Insurance Company, 8 Pa. Commw. 110, 113-14, 301 A.2d 438, 440 (1973).
Van Cor, Inc. argues that, since GSA's preliminary objections said that the lower court had no jurisdiction without saying that the Board of Arbitration of Claims did, it may not point out to this Court that the Board had jurisdiction. The question is not who had jurisdiction other than the Court of Common Pleas, but whether that court had jurisdiction. It had none.
ORDER
AND NOW, this 22nd day of November, 1976, the order of January 20, 1975 of the Court of Common Pleas of Philadelphia County is reversed and the complaint of Van Cor, Inc. against The General State Authority is dismissed.