Schreiner v. City of McKeesport , 512 Pa. 412 ( 1986 )

LARSEN, Justice,

dissenting.

I dissent and in support thereof adopt the opinion of the Court of Common Pleas of Allegheny County, No. G.D. 81-34036, authored by The Honorable Frederic G. Weir.

The following is Judge Weir’s Opinion:

OPINION

WEIR, Judge.

The policemen of the City of McKeesport sued their employer for cost of living benefits (COLA) based upon the Consumer Price Index (CPI) for the year 1980. In a non-jury trial I awarded $20,345.00 to the plaintiffs without interest to the date of the award, exercising the permissible discretion allowed the fact finder in respect to interest because of the well-known financial distress of the defendant which makes it difficult to award anything against it. The present matter is the disposition of exceptions to this award.

The parties had a three-year employment contract for the period from January 1, 1978 to December 31, 1980. It covers all matters of remuneration including yearly increases of the base wages, overtime pay and the COLA’s. It necessarily provides for retroactive pay of COLA’s since the CPI is not known until the end of the year. The contract, although written by the plaintiffs, is the product of laymen, and while it is simple and clear for the most part, it has a degree of ambiguity in one respect.

In explaining the computation of the COLA’s the contract specifically refers to their calculation for the years 1978 and 1979 without mention of any calculation for 1980, although the two sentences which cover this calculation conclude with the phrase “and continuing thereafter.” Then following a sentence which limits consideration of the CPI to six points, it then goes on with a two-sentence paragraph which is ambiguous on its face. The first sentence is “The COLA’s called for herein are payable on January 1, 1979 and January 1, 1980” which certainly, standing by itself, provides for only two COLA’s as contended by the defendant. However, the second sentence reads “Because the monthly CPI figures are not published until the next succeeding month for the month in question, any COLA due hereunder shall be retroactive to January 1, 1979, and January 1, 1980, when and if it becomes necessary to wait beyond such dates for applicable figures needed to compute any COLA.” This latter sentence is clearly to the effect that a COLA was contemplated for the year 1980.

As is stated in plaintiffs’ brief, citing Ludwig Honold Manufacturing Company v. Fletcher, 404 [405] F.2d 1123, the paramount question in the legal construction of all contracts is a determination of the real intention of the parties. When, as here, you have a three-year contract covering all aspects of remuneration of employees, it is unlikely that it would be intended to cover cost of living adjustments for only two of the three years while covering everything else for three years. More importantly, however, the actual words of the contract when considered as a whole, as they must be, weigh considerably in favor of the plaintiffs’ position.

Reference is made to alleged error in permitting testimony of plaintiffs’ representatives in regard to the intention of the parties. This question of law need not be discussed because the decision of the Court at the time of the trial, and presently in dismissing the Exceptions, is based solely upon the contract itself.