DocketNumber: 71 MAP 2006
Judges: Cappy, Castille, Saylor, Eakin, Baer, Baldwin, Former, Newman
Filed Date: 10/17/2007
Status: Precedential
Modified Date: 10/19/2024
OPINION
In this appeal, we review the Commonwealth Court’s Order, granting partial summary judgment to the appellee, Pennsylvania Associated Builders and Contractors, Inc. (“ABC”), and enjoining the appellant, the Commonwealth Department of General Services (“DGS”), from using the competitive sealed proposal process set forth in Section 513 of the Commonwealth Procurement Code (“Procurement Code” or “Code”), 62 Pa.C.S. § 513, for certain future construction projects. For the reasons stated below, the Order of the Commonwealth Court is reversed, and this case is remanded to the Commonwealth Court for further proceedings consistent with this opinion.
The record on summary judgment is as follows. In May of 1913, the General Assembly enacted a statute, commonly referred to as the Separations Act, which governs the letting of certain contracts for the erection, construction, and alteration of any public building. Act of May 1, 1913, P.L. 155, No. 104 § 1. Under the Separations Act, when the total cost of the project exceeds $4,000, those who secure the plumbing, heating, ventilating, and electrical work are duty-bound to prepare separate specifications, receive separate bids, and award separate contracts to the lowest responsible bidder for each of these branches. 71P.S. § 1618.
Under the Code, DGS is responsible for procuring or supervising the procurement of all supplies, services or construction needed by Commonwealth agencies for which it acts as purchasing agent. 62 Pa.C.S. § 321(a). In order to execute its responsibilities, the Code authorizes DGS to formulate policy and enter into contracts. 62 Pa.C.S. §§ 103, 301, 311-312, 322. In the Code, the word “contract” is defined as follows:
§ 103. Definitions
Subject to additional definitions contained in subsequent provisions of this part which are applicable to specific provisions of this part, the following words and phrases when used in this part shall have the meanings given to them in this section unless the context clearly indicates otherwise:
*586 Contract. A type of written agreement, regardless of what it may be called, for the procurement or disposal of supplies, services or construction and executed by all parties in accordance with the act of October 15, 1980 (P.L. 950, No. 164), known as the Commonwealth Attorneys Act.
62 Pa.C.S. § 103 (footnote with Purdons citation omitted).
Since Section 511 of the Code states that all Commonwealth agency contracts shall be awarded by competitive sealed bidding under Section 512, unless otherwise provided by law and except as provided for in specified Code exceptions, DGS uses the competitive sealed bidding process set forth in Section 512 to award construction contracts. 62 Pa.C.S. § 511. Under Section 512, DGS issues an invitation for bids and awards the contract to the lowest responsible bidder. 62 Pa.C.S. § 512(b),(g).
One of the exceptions to Section 512 listed in Section 511 is Section 513. 62 Pa.C.S. §§ 511, 513.
Under a policy determination made in April of 2005, DGS considers use of Section 513 for the procurement of contracts for complex construction projects or those with allocations in excess of $5,000,000. In this regard, DGS developed a competitive sealed proposal process referred to as the “RFP process,” which is described in two documents that DGS distributed, the “Standard Request for Proposals for Multiple Prime Contractors for Construction” (“Standard RFP”) and the “Request for Proposals Guidelines” (“RFP Guidelines”).
In response to ABC’s Petition for Review, DGS filed preliminary objections, raising ABC’s lack of standing, failure to exhaust administrative remedies, and failure to state a claim upon which injunctive relief can be granted. By Order dated February 23, 2006, the Commonwealth Court denied DGS’s preliminary objections, and DGS filed its Answer with New Matter.
On March 15, 2006 and March 25, 2006, ABC and DGS filed cross motions for partial summary judgment, respectively. The motions raised the same threshold issue — whether DGS may use the competitive sealed proposal process set forth in
The Commonwealth Court’s holding was premised on several conclusions. First, the court concluded that even though the word “contract” as defined in the Code at 62 Pa.C.S. § 103 includes construction contracts, “that definition is not preclusive because within the Procurement Code that definition is not always used to include construction contracts.” Id. at 396. Second, the court concluded that more importantly, application of the Code’s definition of contract to Section 513 was “essentially vitiated” by the incorporation of the Separations Act into the Code by Section 322(6). Id. In this regard, the court reasoned that if it were to interpret Section 513 as applying to construction contracts, the Code would modify the Separations Act, a result that was prohibited under Section 6(d) of Act 57’s repealer section. Id. And third, the court concluded that a ruling that Section 513 included construction contracts would
Accordingly, by Order dated May 18, 2006, the Commonwealth Court granted ABC’s motion for partial summary judgment; denied DGS’s motion for partial summary judgment; and enjoined DGS from utilizing the competitive sealed proposal process on any future construction project under its RFP process, its Standard RFP and its RFP Guidelines. Id. at 397.
DGS filed a timely appeal in this Court, raising whether the Commonwealth Court correctly held that Section 513 does not apply to construction contracts and thus, is unavailable to DGS for the procurement of construction contracts.
The Act provides that “[w]ords and phrases shall be construed according to the rules of grammar and according to their common and approved usage”; and that “technical words and phrases and such others as have acquired a peculiar and appropriate meaning . .. shall be construed according to such peculiar and appropriate meaning or definition.” 1 Pa.C.S. § 1903(a). Further, if the General Assembly defines words that are used in a statute, those definitions are binding. Commonwealth v. Kimmel, 523 Pa. 107, 565 A.2d 426, 428 (1989). The Act allows a court to presume that the General Assembly does not intend a result that is absurd, impossible of execution or unreasonable; that the General Assembly intends the entire statute to be certain and effective, and intends to favor the public interest as against any private interest. 1 Pa.C.S. § 1922(1),(2),(5). Moreover, the Act sets forth rules for a court to follow when provisions in or among statutes are in conflict and cannot be reconciled. 1 Pa.C.S. §§ 1933-1936.
Reflecting the Commonwealth Court’s analysis, ABC counters that even though the Code’s definition of contract in 62 Pa.C.S. § 103 includes three alternative agreement types, there is more to the definition for purposes of construing the Section 512’s exceptions. ABC argues that inasmuch as several of the exceptions, like Section 517,
ABC is correct in one respect: there is more to the General Assembly’s definition of contract in 62 Pa.C.S. § 103. ABC is, however, mistaken as to what more there is. In addition to defining Code terms, 62 Pa.C.S. § 103 opens with a passage that states in relevant part, that “the following words and phrases when used in this part shall have the meanings given to them in this section unless the context clearly indicates otherwise.” 62 Pa.C.S. § 103 (emphasis added). From these words, it follows that the General Assembly contemplated that there might be instances in the Code when a term defined in
Applying these instructions to Section 513, we observe that when read in context, there is nothing to indicate that the General Assembly intended for the word “contract” as used in that exception to mean something other than its Code definition — “[a] . .. written agreement ... for the procurement or disposal of supplies, services or construction.” 62 Pa.C.S. § 103. See supra pp. 585-87, 932 A.2d at 1274-76. Moreover, in our view, this definition of contract is clear and explicit in including contracts for construction. Therefore, we conclude that the clear and unambiguous language of the exception in Section 513 encompasses construction contracts, and that the Commonwealth Court’s conclusion to the contrary was erroneous.
In addition, we conclude that the Commonwealth Court’s two alternative bases for its holding were unfounded. The first was the Commonwealth Court’s reliance on contemporaneous legislative history to construe Section 513 and decide that it did not apply to construction contracts. Under the Statutory Construction Act, it is only when the words of a statute are not explicit that factors extraneous to statutory language may be consulted to ascertain the General Assembly’s intent. 1 Pa.C.S. § 1921(c); Commonwealth v. Packer, 568 Pa. 481, 798 A.2d 192, 196 (2002) (observing that only when the language of the statute is ambiguous does statutory construction under 1 Pa.C.S. § 1921(c) become necessary). Because the words of Section 513 are clear with respect to the question before us, the Code’s contemporaneous legislative history, one of the extraneous factors listed in the Act, should not have been consulted. 1 Pa.C.S. § 1921(c)(7).
The second was the Commonwealth Court’s decision to vitiate application of the Code’s definition of contract to Section 513, apparently out of a concern that there would be a conflict between Section 322(6) and Section 513, if the definition were applied in the latter. Under the Act, a court is not to anticipate and avoid a conflict between statutory provisions
Our present inquiry, however, is not ended. We must address the interplay between Section 513 and Section 322(6) because Section 322(6), like Section 513, concerns the area of construction contract procurement and has bearing on the question that we must ultimately resolve, which is whether DGS may use Section 513 to procure such contacts. 62 Pa.C.S. §§ 322(6), 513. DGS asserts that if we were to read the Code as a whole and study its legislative history, we would see that the General Assembly sought to enlarge the methods of public contract procurement, and from this we would conclude that Section 322(6) incorporates the mandate of separate specifications, bids, and contracts for plumbing, heating, ventilation and electrical work from the Separations Act into the Code, but not its mandate that awards be made to the lowest responsible bidder. See 71 P.S. § 1618. Therefore, Sections 322(6) and 513 are harmonious. ABC responds that DGS’s position has no merit because the words in Section 322(6) and Section 6(d) of Act 57 of 1998, P.L. 358, Act 57’s repealer section, reveal that all of the Separations Act’s requirements apply to DGS’ procurement of construction contracts under the Code.
As to the meaning of Section 322(6), we agree with ABC. Section 322(6) makes no differentiation among the Separations Act’s elements and clearly gives effect in the Code to every one of the statute’s requirements. 62 Pa.C.S. § 322(6). The only modification Section 322(6) makes to the Separations Act is to increase its $4,000 monetary trigger. Id. See 71 P.S. § 1618.
Yet, at the same time, Section 513 allows DGS to select a person other than the lowest responsible bidder for construction contract negotiation. 62 Pa.C.S. § 513(g). Thus, Section 513 and Section 322(6) clearly conflict in the respective rules they set for the procurement of construction contracts. 62 Pa.C.S. §§ 322(6), 513(g).
At this juncture, we turn to those sections in the Statutory Construction Act that provide instructions for ascertaining the General Assembly’s intent when statutory provisions conflict.
Sectionl933 initially instructs that “Lwjhenever a general provision in a statute shall be in conflict with a special provision in the same or another statute, the two shall be construed, if possible so that effect can be given to both.” Section 1933 next instructs that “[i]f the conflict between the two provisions is irreconcilable, the special provisions shall prevail and shall be construed as an exception to the general provision, unless the general provision shall be enacted later
With these principles from the Statutory Construction Act in mind, we conclude that Section 822(6) and Section 513 are irreconcilable. 62 Pa.C.S. §§ 322(6), 513. That is, we can discern no way to harmonize these provisions, given the clear import of each. Therefore, we further conclude that Section 513, the special provision, prevails and is viewed as an exception to the general provision, Section 322(6). Id. Accordingly, we hold that contracts for the procurement of construction may be entered by DGS under Section 513, through the competitive sealed proposal process. 62 Pa.C.S. § 513.
For all of these reasons, the Order of the Commonwealth Court is reversed, and this case is remanded to the Commonwealth Court for further proceedings consistent with this opinion.
. The Separations Act provides:
§ 1618. Separate specifications for plumbing, heating, ventilating and electrical work; separate bids and contracts
Hereafter in the preparation of specifications for the erection, construction, and alteration of any public building, when the entire cost of such work shall exceed four thousand dollars, it shall be the duty
Every contract for the construction, reconstruction, alteration, repair, improvement or maintenance of public works shall comply with the provisions of the act of March 3, 1978 (P.L. 6, No. 3), known as the Steel Products Procurement Act.
71 P.S. § 1618 (footnote to Purdons cite omitted).
. At the time the Separations Act was enacted, the designation of lowest responsible bidder was part of Pennsylvania law. In the case of Douglass v. Commonwealth, 108 Pa. 559 (Pa. 1885), this Court addressed its meaning under the Act of May 23, 1874 P.L. 233, § 6, 53 P.S. § 282, which directed that municipal contracts for supplies are to be awarded to "the lowest responsible bidder.” We concluded that the designation applies to pecuniary ability, and to judgment and skill. Id. at .563.
. The Procurement Code defines "Procurement” and "Construction” as follows:
"Procurement.” Buying, purchasing, renting, leasing, licensing or otherwise acquiring any supplies, services or construction. The term also includes all functions that pertain to the obtaining of any supply, service or construction, including description of requirements, selection and solicitation of sources, preparation and award of contract and all phases of contract administration.
Construction. The process of building, altering, repairing, improving or demolishing any public structure or building or other public improvements of any kind to any public real property. The term does not include the routine operation or maintenance of existing structures, buildings or real property.
62 Pa.C.S. § 103.
. Act 57 provides:
Nothing in this act shall repeal, modify or supplant the following acts and parts of acts:
Section 6(d) of Act 57 of 1998, P.L. 358.
. In Section 322(6), the Code states:
The following procedure shall apply to construction to be completed by the department which costs more than the amount established by the department under section 514 (relating to small procurements) for construction procurement unless the work is to be done by Commonwealth agency employees or by inmates or patients of a Commonwealth agency institution:
(6) For construction contracts where the total construction costs are less than $25,000, the department shall not be required to comply with the the act of May 1, 1913 (P.L. 155, No. 104), entitled "An act regulating the letting of certain contracts for the erection, construction, and alteration of public buildings,” and the department may award such contracts in accordance with section 511. All projects equal to or exceeding $25,000 shall be subject to the Separations Act, the act of May 1, 1913 (P.L. 155, No. 104), entitled “An act regulating the letting of certain contracts for the erection, construction, and alteration of public buildings....”
62 Pa.C.S. § 322(6).
. Section 512 provides in relevant part:
(a) Conditions for use. — Contracts shall be awarded by competitive sealed bidding except as otherwise provided in section 511 (relating to methods of source selection).
(b) Invitation for bids. — An invitation for bids shall be issued and shall include a procurement description and all contractual terms, whenever practical, and conditions applicable to the procurement.
(g) Award. — The contract shall be awarded within 60 days of the bid opening by written notice to the lowest responsible bidder or all bids shall be rejected except as otherwise provided in this section.....
62 Pa.C.S. § 512(a)-(b),(g).
. Section 513 provides in full:
(a) Conditions for use. — When the contracting officer determines in writing that the use of competitive sealed bidding [under Section 512] is either not practicable or advantageous to the Commonwealth, a contract may be entered into by competitive sealed proposals.
(b) Request for proposals. — Proposals shall be solicited through a request for proposals.
(c) Public notice. — Public notice of the request for proposals shall be given in the same manner as provided in section 512(c) (relating to competitive sealed bidding).
(d) Receipt of proposals. — Offerors shall submit their proposal to ensure that their proposals are received prior to the time and date
(e) Evaluation. — The relative importance of the evaluation factors shall be fixed prior to opening the proposals. A Commonwealth agency is required to invite its comptroller to participate in the evaluation as a nonvoting member of any evaluation committee.
(f) Discussion with responsible offerors and revision of proposals.— As provided in the request for proposals, discussions and negotiations may be conducted with responsible offerors for the purpose of clarification and of obtaining best and final offers. Responsible offers shall be accorded fair and equal treatment with respect to any opportunity for discussion and revision of proposals. In conducting discussions, there shall be no disclosure of any information derived from proposals submitted by competing offerors.
(g) Selection for negotiation. — The responsible offeror whose proposal is determined in writing to be the most advantageous to the purchasing agency, taking into consideration price and all evaluation factors, shall be selected for contract negotiation.
62 Pa.C.S. § 513.
. Under the RFP process, DGS calculates a proposal score for each responsive proposal that is timely submitted. The responsible offeror whose responsive proposal receives the highest proposal score is selected for contract negotiation. The formula DGS uses for calculating a proposal score is: Proposal score = Cost Submittal Score x (0.60) +
. As noted, the Separations Act also requires that separate specifications for the plumbing, heating, ventilating, and electrical work be prepared; that separate bids for this work be received and that separate contracts for this work be awarded. See supra n. 1. In this case, ABC has not argued that DGS’s RFP process violates these particular requirements.
. ABC's motion for partial summary judgment also raised whether the RFP process was contrary to law, arbitrary and capricious and an abuse of discretion; whether the RFP process violates the Separations Act; whether the RFP process violates the Pennsylvania Constitution; whether DGS failed to follow applicable rule making procedures in implementing the RFP process and whether the Standard RFP renders the Procurement Code's bid protest procedures meaningless.
DGS’s motion for partial summary judgment also raised the issues whether its solicitation of multiple prime construction contracts through the use of a sealed proposal process violates the Separations Act, the Pennsylvania Constitution, and/or the Commonwealth Documents Law; whether the language in DGS’ solicitation for multiple prime construction contracts through the use of a sealed proposal process properly protect the rights of protest; and whether two specific decisions DGS made in determining to use the competitive sealed proposal process were arbitrary or an abuse of discretion.
None of these issues was addressed by the Commonwealth Court, given its resolution of the threshold issue.
. President Judge Colins authored a dissenting opinion, which Judges McGinley and Leadbetter joined. The dissent would have concluded that the competitive sealed proposal method for construction contracts is not clearly prohibited by constitution or statute; that given the Separation Act's date of enactment, its use of the word “bidder” does not preclude the use of the RFP process, so long as its other requirements are followed; and that it is unwise for the courts to micromanage executive branch procurement practices. Id. at 397-400.
. We have jurisdiction under 42 Pa.C.S. § 723. Our substantive review is reflected in the Pennsylvania Rules of Civil Procedure that govern summary judgment. Under the Rules, the court shall enter judgment whenever there is no genuine issue of any material fact as to a necessary element of the cause of action or defense that could be established by additional discovery. Pa.R.C.P. No. 1035.2(1). Under the Rules, a motion for summary judgment is based on an evidentiary record that entitles the moving party to a judgment as a matter of law. Note to Pa.R.C.P. No. 1035.2.
An appellate court may reverse the granting of a motion for summary judgment if there has been an error of law or an abuse of discretion. Atcovitz v. Gulph Mills Tennis Club, Inc., 571 Pa. 580, 812 A.2d 1218, 1221 (2002). As the issue as to whether there are no genuine issues as to any material fact presents a question of law, our standard of review is de novo; thus, we need not defer to the determinations made by the lower tribunals. Fine v. Checcio, 582 Pa. 253, 870 A.2d 850, 857 n. 3 (2005). Our scope of review, to the extent necessary to resolve the legal question before us, is plenary. Id.; Pa.R.A.P. 2111(a)(2).
. Section 517, an exception to Section 512 for multiple awards, states in one of its subsections that ‘‘[i]nvitations to bid or requests for proposals shall be issued for the supplies, services or construction to be purchased.” 62 Pa.C.S. § 517.
. As noted, after modifying the Separations Act’s monetary trigger, Section 322(6) subjects all construction contracts to the Separations
. We observe that because DGS argued that there was no conflict in the Code’s provisions and ABC argued that Section 513 does not apply to construction contracts, neither party took a position on application of the Statutory Construction Act in this regard.
. 62 Pa.C.S. § 322(6) and § 513 were enacted at the same time. Act of May 15 1998, P.L. 358 No. 57 § 1.