A. Abbonizio & C. Abbonizio Contractors, Inc. v. City of Philadelphia & Thomas P. Carney, Inc. ( 2020 )

IN THE COMMONWEALTH COURT OF PENNSYLVANIA
Anthony Abbonizio and C. Abbonizio :
Contractors, Inc., :
Appellants :
:
v. :
:
City of Philadelphia and Thomas P. : No. 974 C.D. 2019
Carney, Inc. : Submitted: May 11, 2020
BEFORE: HONORABLE PATRICIA A. McCULLOUGH, Judge
HONORABLE ANNE E. COVEY, Judge
HONORABLE J. ANDREW CROMPTON, Judge
OPINION NOT REPORTED
MEMORANDUM OPINION BY
JUDGE COVEY FILED: June 5, 2020
Anthony Abbonizio and C. Abbonizio Contractors, Inc. (collectively,
Appellants) appeal from the Philadelphia County Common Pleas Court’s (trial court)
July 8, 2019 order denying their Emergency Petition for Preliminary Injunction
(Petition). Therein, Appellants sought to enjoin the City of Philadelphia (City) and
Thomas P. Carney, Inc. (Carney) from proceeding with construction of the City
Water Department’s Residuals Lagoon Closure Plan and Raw Water Basin Dredging
at Queen Lane Water Treatment Plant (the Project) because the City awarded Carney
the public contract in violation of Section 17-109 of The Philadelphia Code
(Philadelphia Code).1 The issue before this Court is whether the trial court erred by
denying Appellants’ Petition. Upon review, we reverse.
1
Phila., Pa., The Philadelphia Code § 17-109 (2016).
Background
In January 2019, the City solicited sealed bids for general construction
services pursuant to Bid No. 2222/B1904380 (the Bid) relating to the Project. See
Petition ¶ 9 (Reproduced Record (R.R.) at 30a); see also Petition Ex. A (R.R. at 63a-
68a).2 On February 21, 2019, Appellants submitted a sealed bid for the Project in the
amount of $17,340,580.00. See Petition ¶¶ 10-11 (R.R. at 30a). On that same date,
the City publicly opened the sealed bids. Appellants were the lowest bidder, and
Carney was the second lowest bidder at $17,585,655.05. See Petition ¶¶ 14-15 (R.R.
at 31a).
On April 1, 2019, the City awarded the contract to Appellants and issued
a Notice of Award. See Petition ¶ 22 (R.R. at 32a); see also Petition Ex. E (R.R. at
136a-138a). On that same date, the City and Appellants entered into a Go-Ahead
Agreement.3 See Petition ¶ 23 (R.R. at 32a); see also Petition Ex. F (R.R. at 140a).
Thereafter, Appellants began working on the Project. See Appellants’ First
Emergency Application for Injunction Pending Appeal ¶ 32.
In mid-April, Appellants inquired of the City regarding the notice to
proceed and other requisite Project paperwork. See Petition ¶ 25 (R.R. at 32a). In
response, the City notified Appellants that there had been a challenge made to its
contract award to Appellants. See Petition ¶ 26 (R.R. at 32a). By April 16, 2019
2
Appellants’ Petition is supported by City taxpayer/C. Abbonizio Contractors, Inc. (CAC)
vice president Anthony Abbonizio’s and CAC president Peter Abbonizio’s affidavits. See Petition
Exs. 1, 2 (R.R. at 47a-61a). For ease of reference, the documents attached as exhibits thereto and
incorporated therein by reference are herein referred to as Petition exhibits.
3
The Go-Ahead Agreement provides, in relevant part:
[Appellants] ha[ve] agreed with the [City] to begin work in advance
of full conformance of Contract Number 19-5992 on a mutually
agreed start date. It is understood that no payments can be made until
the contract is fully conformed and the purchase order issued.
Petition Ex. F (R.R. at 140a).
2
letter, Appellants informed the City of its continued reliance on the City’s
representations, and that it was incurring costs due to the award and the City’s
subsequent direction. See Petition ¶ 27 (R.R. at 32a); see also Petition Ex. G (R.R. at
142a-143a).
On April 17, 2019, the City directed Appellants to cease all work on the
Project pending further notification. See Petition ¶ 28 (R.R. at 32a). By April 26,
2019 letter, the City informed Appellants that, since Carney was a qualified local
business entity (LBE) certified by the Commissioner of the City’s Procurement
Department (Department) pursuant to Section 17-109(3) of the Philadelphia Code,
Carney was entitled to the City’s LBE preference for the Project, which reduced its
bid by 5%. See Section 17-109(5)(d)(.3) of the Philadelphia Code, Phila. Code § 17-
109(5)(d)(.3); see also Petition Exs. H (R.R. at 147a-148a), J (R.R. at 161a-162a).
After the City applied the LBE preference, Carney’s bid was reduced to
$16,703,372.30, which made Carney the lowest bidder on the Project. See Petition ¶¶
16-18 (R.R. at 31a); see also Petition Exs. B (R.R. at 70a-74a), H at 1 (R.R. at 147a).
By May 2, 2019 letter, Appellants informed the City that if Appellants
did not receive a notice to proceed by May 8, 2019, they would seek to enjoin the
City from entering into any contract for the Project. See Petition ¶¶ 32-34 (R.R. at
33a); see also Petition Exs. I (R.R. at 150a-154a), J (R.R. at 160a-162a). Appellants
claimed that, since Carney failed to submit with its bid the current certification(s) and
recent affidavit(s) of the LBE subcontractor(s) it intended would assist Carney to
perform 51% of the work on the Project, as required by Section 17-109(5)(a)(.4) of
the Philadelphia Code,4 Carney was not entitled to the bid preference. See id.
4
Section 17-109(5)(a) of the Philadelphia Code specifies:
On any contract for which the City secures competitive bids pursuant
to Section 8-200(1) of the Home Rule Charter, the Commissioner
3
On May 17, 2019, Appellants emailed the City seeking the City’s
position on Appellants’ May 2, 2019 letter. See Petition Ex. J (R.R. at 160a). The
City responded that its April 26, 2019 letter was its official position. See Petition ¶
35 (R.R. at 33a); see also Petition Ex. J (R.R. at 160a). On May 20, 2019, Appellants
requested from the City a copy of Carney’s LBE certification. See Petition ¶ 36 (R.R.
at 33a); see also Petition Ex. K (R.R. at 163a). The City did not respond to
Appellants’ request. See Petition ¶ 37 (R.R. at 34a). On May 22, 2019, the City
awarded the contract for the Project to Carney. See R.R. at 329a.
shall award a [5%] bid preference . . . to any Local Business that
submits with its bid:
....
(.3) A certification by the [LBE] that, throughout the
entirety of the contract:
(A) The [LBE] or a subcontractor will perform the
majority of any work on the subject contract within the
geographic limits of the City;
(B) The [LBE] or a subcontractor will maintain within
the City a majority of the inventory or equipment that
will be used on the contract; and
(C) The [LBE] will satisfy subsection 3(a), subsection
3(b), and at least one of the requirements identified in
subsection 3(c).
(.4) If the [LBE] relies upon a subcontractor to
meet the requirements in subparagraph (a)(.3)(A) or
(a)(.3)(B) of this subsection:
(A) A current certification from the Commissioner
that the subcontractor itself is a[n] [LBE]; and
(B) The subcontractor’s most recent annual affidavit
provided to the Commissioner pursuant to subsection
4(a).
Phila. Code § 17-109(5)(a) (emphasis added).
4
Facts
On May 28, 2019, Appellants filed a Complaint in Equity (Complaint),
the Petition, and a memorandum of law in support of the Petition in the trial court.5
See R.R. at 25a-185a, 189a-316a. On May 29, 2019, after an emergency hearing, see
R.R. at 629a-648a, the trial court granted the Petition, thereby enjoining the City from
awarding the contract to Carney or any other bidder. See R.R. at 186a-188a.
On June 5, 2019, Carney filed an Emergency Motion for
Reconsideration (Reconsideration Motion), claiming that Carney had not received
notice of the May 29, 2019 emergency hearing. See R.R. at 317a-523a. On June 10,
2019, Appellants opposed Carney’s Reconsideration Motion. See R.R. at 524a-570a.
On June 20, 2019, Carney filed a reply brief. See R.R. at 571a-580a. On June 21,
2019, Appellants filed a sur-reply brief. See R.R. at 581a-588a. On July 2, 2019, the
City joined Carney’s Reconsideration Motion. See R.R. at 591a-592a.
On July 8, 2019, the trial court granted Carney’s Reconsideration
Motion, see R.R. at 594a, reheard argument on Appellants’ Petition, see R.R. at 649a-
676a, and denied the Petition. See R.R. at 593a. On July 23, 2019, Appellants filed a
notice of appeal from the trial court’s order and an Emergency Application for
Injunction Pending Appeal (First Emergency Application) with this Court. See R.R.
5
Carney repeatedly references in its brief that Appellants waited over a month before filing
the emergency Petition. However, the record reflects that between April 26, 2019 (when the City
notified Appellants that it should award the contract to Carney), and May 28, 2019 (when
Appellants filed the Complaint and Petition), Appellants notified the City (by May 2, 2019 letter) of
their position and demanded the notice to proceed from the City, but the City did not respond. After
Appellants followed up on May 17, 2019, the City confirmed its position; on May 20, 2019,
Appellants requested from the City a copy of Carney’s LBE certification, which the City
disregarded; on Wednesday, May 22, 2019, the City officially awarded Carney the contract.
Appellants filed the Petition a mere three business days later, on Tuesday, May 28, 2019 (Monday
May 27, 2019, was a court holiday). Under the circumstances, it cannot be said that Appellants
waited over a month and, thus, slept on their rights.
5
at 596a-612a. On July 26, 2019, the City issued Carney a Notice to Proceed. See
Hearing Ex. P-3.
On August 7, 2019, this Court conducted a hearing on Appellants’ First
Emergency Application. By August 15, 2019 order, this Court denied the First
Emergency Application because Appellants failed to first seek a stay from the trial
court pending appeal, as required by Pennsylvania Rule of Appellate Procedure
(Rule) 1732. See R.R. at 624a-628a. Also on August 15, 2019, Carney and the City
held a pre-construction meeting. See Original Record (O.R.) Item 33 ¶ 3.
On August 23, 2019,6 Appellants filed in the trial court an Emergency
Motion for Stay and Injunction Pending Appeal (Stay Motion) “pursuant to [Rule]
1732,” O.R. Item 29 at 1, asking the trial court to “enter an [o]rder staying this action
and enjoining the [City] and [Carney] from proceeding with construction of the
Project in violation of public bidding laws pending a determination of [Appellants’]
appeal on the merits.” O.R. Item 29 at 21; see also O.R. Item 29 at 2. That same
day, the trial court issued the following ex parte order: “The emergency relief
requested is hereby DENIED; and [] [t]he underlying [Stay M]otion shall proceed
through the regular court process.” Trial Ct. August 23, 2019 Order. On August 27,
2019, Carney filed an answer, new matter and counterclaim to Appellants’
Complaint.7 See O.R. Item 31.
On August 28, 2019, the trial court issued its opinion in support of its
July 8, 2019 order pursuant to Rule 1925(a), concluding therein that it properly
denied Appellants’ Petition because Appellants failed to prove both their likelihood
6
Appellants filed the Stay Motion in the trial court on August 16, 2019. The delay occurred
because an electronic filing issue on August 16, 2019 prevented the trial court from hearing the Stay
Motion on an emergent basis; therefore, Appellants withdrew the Stay Motion and refiled it on
August 23, 2019. See Second Emergency Appl. for Stay and Injunction Pending Appeal ¶¶ 65, 67-
68.
7
Carney’s counterclaim was for tortious interference with contractual relations and
commercial disparagement. See O.R. Item 31.
6
of prevailing on the merits and that an injunction is necessary to prevent immediate
and irreparable harm that damages cannot adequately compensate. See Trial Ct.
August 28, 2019 Op.; R.R. at 618a-622a.
On September 11, 2019, Appellants filed a Second Emergency
Application for Stay and Injunction Pending Appeal (Second Emergency
Application) in this Court, wherein they declared that they filed the Stay Motion in
the first instance to the trial court which denied them the requested emergent relief.
They further asserted that because the trial court on multiple occasions denied them
the requested emergent relief and, due to the time-sensitive nature of the matter, it
was not practicable to continue to seek injunctive relief from the same trial court.
Based thereon, in their Second Emergency Application, Appellants asked this Court
to: (1) stay the underlying action in the trial court; and (2) enjoin the City and Carney
from proceeding with construction of the Project. On September 19, 2019, the City
filed its Response to Appellants’ Second Emergency Application, and Carney filed its
answer and a brief opposing the Second Emergency Application. Carney represented
in its opposing brief that it had “mobilized equipment to the site, had . . . several other
meetings on-site with the [City’s] Water Department, ordered materials[,] and [wa]s
actively engaged with personnel working on-site.” Carney Br. in Opp’n to Second
Emergency Appl. at 7.
On September 30, 2019, after consideration of Appellants’ Second
Emergency Application and the City’s and Carney’s opposition thereto, this Court
granted the Second Emergency Application.8 Therein, this Court concluded that
Appellants satisfied both the Pennsylvania Public Utility Commission v. Process Gas
Consumers Group, 467 A.2d 805 (Pa. 1983), and Summit Towne Centre, Inc. v. Shoe
8
This Court also held that Appellants satisfied the requirements of Rule 1732 and that this
controversy was not rendered moot by the City awarding the contract for the Project to Carney. See
September 30, 2019 Op. at 5, 8.
7
Show of Rocky Mount, Inc., 828 A.2d 995 (Pa. 2003), criteria for an injunction
pending appeal.9 See Tri-State Asphalt Corp. v. Dep’t of Transp., 582 A.2d 55 (Pa.
Cmwlth. 1990). Accordingly, this Court enjoined the City and Carney from
proceeding with the Project during the pendency of the instant appeal.10
On October 4, 2019, Carney filed an Emergency Application for
Reconsideration of this Court’s September 30, 2019 Order Granting Preliminary
Injunctive Relief Ancillary to Appeal (Reconsideration Application).11 See
Reconsideration Appl. at 2, 5, 7.
On October 10, 2019, Appellants responded, inter alia, that Carney
failed to meet the legal standard for reconsideration; the Reconsideration Application
must be denied because no new facts warranted consideration and Carney and the
City proceeded with the Project, thereby creating the circumstances of which Carney
complained. See Appellants’ Br. in Opp’n to Reconsideration Appl. at 5, 7, 13, 15.
On October 11, 2019, Carney filed a reply brief in support of its Reconsideration
Application (Carney Reconsideration Application Brief), in which the City joined.
9
This Court expressly determined that
Appellants are likely to prevail on the merits and have a clear right to
relief, there exists immediate and irreparable harm, Appellants will
suffer irreparable injury if the injunction is denied, greater injury
would result from refusing the injunction, issuing the injunction will
not substantially harm other interested parties, the injunction will
maintain the existing status quo, the injunction is reasonably suited to
abate the offending activity, and it will not adversely affect the public
interest[.]
September 30, 2019 Op. at 23.
10
Governor Tom Wolf’s March 19, 2020 Executive Order, which compelled closure of the
physical operations of all non-life sustaining Commonwealth businesses to reduce the spread of
COVID-19, may have also temporarily precluded Carney’s work on the Project.
11
The Reconsideration Application was supported by Carney’s president Robert Carney’s
affidavit. See Reconsideration Appl. Ex. A.
8
On October 23, 2019, this Court denied Carney’s Reconsideration
Application, concluding, among other things, that since this Court did not overlook or
misapprehend record material facts, Carney is not entitled to reconsideration. See
October 23, 2019 Op.
On November 12, 2019, Appellants filed their appellate brief with this
Court. On January 24, 2020, Carney filed its brief. Also on January 24, 2020, the
City notified the Court that the City does not take a position in this matter and would
not be filing a brief. On February 7, 2020, Appellants filed a reply brief.
Discussion
In the Petition, Appellants sought to “enjoin[] the City from awarding a
contract to [Carney] for the [Project] in violation of public bidding laws pending a
determination of the claims on the merits.” Petition at 17.
Initially,
[p]reliminary injunctive relief is an equitable remedy
available in equity actions. Barcia v. Fenlon, 37 A.3d 1 . . .
(Pa. Cmwlth. 2012). ‘A preliminary injunction is designed
to preserve the subject of the controversy in the condition in
which it is when the order is made, it is not to subvert, but
to maintain the existing status quo until the legality of the
challenged conduct can be determined on the merits.’
Greater Nanticoke Area Educ[.] Ass[’]n v. Greater
Nanticoke Area Sch[.] Dist[.], 938 A.2d 1177, 1183 (Pa.
Cmwlth. 2007).
Our review of a trial court’s order granting or denying
preliminary injunctive relief is ‘highly deferential.’ Summit
Towne, . . . 828 A.2d [at] 1000 . . . . ‘[W]e do not inquire
into the merits of the controversy, but only examine the
record to determine if there were any apparently reasonable
grounds for the action of the court below.’ Id. (quoting
Roberts v. B[d.] of Dir[s.] of Sch[.] Dist[.], . . . 341 A.2d
475, 478 ([Pa.] 1975)). Only when it is clear no grounds
exist to support the decree, or the rule of law was ‘palpably
erroneous or misapplied,’ will such order be reversed. Id.
9
[(quoting Roberts, 341 A.2d at 478)]; accord Novak v.
Commonwealth, . . . 523 A.2d 318, 319 ([Pa.] 1987)). Such
reasonable grounds exist when the essential prerequisites
for the granting of an injunction are met. Summit Towne,
828 A.2d at 1000.
SPTR, Inc. v. City of Phila., 150 A.3d 160, 165-66 (Pa. Cmwlth. 2016).
There are six essential prerequisites a party must establish
before obtaining preliminary injunctive relief:
(1) the injunction is necessary to prevent immediate
and irreparable harm that cannot be compensated
adequately by damages; (2) greater injury would
result from refusing the injunction than from
granting it, and, concomitantly, the issuance of an
injunction will not substantially harm other
interested parties in the proceedings; (3) the
preliminary injunction will properly restore the
parties to their status as it existed immediately prior
to the alleged wrongful conduct; (4) the party
seeking injunctive relief has a clear right to relief
and is likely to prevail on the merits; (5) the
injunction is reasonably suited to abate the
offending activity; and, (6) the preliminary
injunction will not adversely affect the public
interest.
SEIU Healthcare P[a.] v. Commonwealth, . . . 104 A.3d
495, 502 ([Pa.] 2014) (citing Warehime v. Warehime, . . .
860 A.2d 41, 46-47 ([Pa.] 2004)). Because the grant of a
preliminary injunction is an extraordinary remedy, the
failure to establish a single prerequisite requires the denial
of the request for injunction. Summit Towne, 828 A.2d at
1000.
SPTR, Inc., 150 A.3d at 166. The burden of proving each prerequisite rests on the
moving party. Weeks v. Dep’t of Human Servs., 222 A.3d 722 (Pa. 2019); SEIU
Healthcare; Summit Towne. Moreover, Pennsylvania Rule of Civil Procedure No.
1531(a) specifies: “In determining whether a preliminary . . . injunction should be
granted . . . , the court may act on the basis of the averments of the . . . petition and
10
may consider affidavits of parties or third persons or any other proof which the court
may require.” Pa.R.C.P. No. 1531(a).
Here, the trial court denied the Petition, concluding:
[T]he trial court did not abuse its discretion in denying
Appellant[s’] request for a preliminary injunction because
Appellant[s] failed to prove that they are likely to
prevail on the merits. Here, Appellant[s] d[id] not
succeed in meeting the first prerequisite as they have failed
to show that this injunction is necessary to prevent
immediate and irreparable harm that damages cannot
adequately compensate. Specifically, at the hearing
before the Commonwealth Court, the City’s Water Engineer
Project Manager Trisha Grace (‘Grace’), testified that,
although the Project is important, it is not an emergency,
and that the City and [Carney] had not yet even conducted
their pre-construction meeting. Moreover, damages can
adequately compensate Appellant[s] for whatever work may
have been done between April 1, 2019, when the Go-Ahead
Agreement was issued by the City[,] and April 17, 2019,
when the City notified Appellant[s] to cease all work
related to the Project.
In accordance with [Summit Towne], this trial court does not
need to address the other [] prerequisites . . . .
Trial Ct. August 28, 2019 Op. at 5; R.R. at 622a (emphasis added; footnote omitted).
Because the trial court’s decision only addressed two prerequisites -
whether Appellants have a clear right to relief and are likely to prevail on the merits,
and whether an injunction is necessary to prevent immediate and irreparable harm
that damages cannot adequately compensate - this Court will address those
prerequisites first.
1. The Party Seeking Injunctive Relief Has A Clear Right
To Relief And Is Likely To Prevail On The Merits
In order to prevail on the Petition, Appellants had to show that they have
a clear right to relief and are likely to prevail on the merits. SPTR, Inc. Without
11
explanation or analysis, the trial court concluded: “Appellant[s] failed to prove that
they are likely to prevail on the merits.” Trial Ct. August 28, 2019 Op. at 5.
Appellants sought an injunction because Carney’s bid contained non-
waivable, material defects. Specifically, they argued that, based on Carney’s and the
City’s documentation, Carney will only be performing 20% of the work under the
contract;12 therefore, Carney was obligated to submit with its bid the LBE
certification(s) and most recent annual affidavit(s) of the subcontractor(s) that would
perform the remaining 31% of the work that qualified Carney for the LBE bid
preference that reduced its bid by 5%. See Section 17-109(5)(d)(.3) of the
Philadelphia Code, Phila. Code § 17-109(5)(d)(.3). Appellants claimed that since
Carney did not comply with Section 17-109(5)(a) of the Philadelphia Code, Carney
was not entitled to the bid preference and, thus, was not the lowest bidder.
Preliminarily, this Court has explained:
It is clear that the statutory requirements for competitive
bidding, and the ordinances enacted thereunder, do not exist
solely to secure work or supplies at the lowest possible
price, but also have the ‘‘purpose of inviting competition,
to guard against favoritism, improvidence,
extravagance, fraud and corruption in the awarding of
municipal contracts . . . and are enacted . . . not for the
benefits or enrichment of bidders . . . .’’ Yohe v. [City of]
Lower Burrell, . . . 208 A.2d 847, 850 ([Pa.] 1965)[.] . . .
The obvious intent . . . is thus also to ‘‘close, as far as
possible, every avenue to favoritism and fraud in its
varied forms.’’ Louchheim v. [City of] Phila[.], . . . 66 A.
1121 ([Pa.] 1907) [(]quoting Mazet v. City of Pittsburgh, . .
. 20 A. 693 ([Pa.] 1890)[)]. Therefore, . . . the courts will
not condone a situation that reveals a clear potential to
become a means of favoritism, regardless of [whether] the
12
Carney claims in its brief to this Court that Appellants’ 20% figure is incorrect, as Carney
testified at the August 7, 2019 hearing that the figure was between 20% and 25%. See Carney Br. at
20. However, the Bid Evaluation Checklist the City prepared and relied upon in awarding the
contract, reflects Carney’s 20% representation under “% OF WORK BY CONTRACTOR.” R.R. at 80a;
August 7, 2019 Notes of Testimony Ex. P-2 at 1.
12
[C]ity officials may have acted in good faith in the
particular case[.]
Conduit & Found. Corp. v. City of Phila., 401 A.2d 376, 379 (Pa. Cmwlth. 1979)
(emphasis added). Therefore, “[t]hose who bid for a public contract must be ‘on an
equal footing’ and enjoy the same opportunity for open and fair competition. Where
the bid process fails to place bidders on equal footing, the resulting contract will be
declared void.” Hanisco v. Twp. of Warminster, 41 A.3d 116, 123 (Pa. Cmwlth.
2012) (citation omitted).
LBE preference is derived from the Philadelphia Code enacted by the
City’s legislative body, the City Council. See Section 1-101 of the Philadelphia
Code, Phila. Code § 1-101. In order to qualify for the LBE preference, Section 17-
109(5)(a) of the Philadelphia Code specifies:
(a) On any contract for which the City secures competitive
bids pursuant to Section 8-200(1) of the Home Rule
Charter, the Commissioner shall award a [5%] bid
preference . . . to any Local Business that submits with its
bid:
(.1) A current certification from the
Commissioner as a[n] [LBE];
(.2) The [LBE’s] most recent annual affidavit
under subsection 4(a);
(.3) A certification by the [LBE] that,
throughout the entirety of the contract:
(A) The [LBE] or a subcontractor will
perform the majority of any work on the
subject contract within the geographic limits of
the City;
(B) The [LBE] or a subcontractor will
maintain within the City a majority of the
inventory or equipment that will be used on the
contract; and
13
(C) The [LBE] will satisfy subsection 3(a),
subsection 3(b), and at least one of the
requirements identified in subsection 3(c).
(.4) If the [LBE] relies upon a
subcontractor to meet the requirements in
subparagraph (a)(.3)(A) or (a)(.3)(B) of this
subsection:
(A) A current certification from the
Commissioner that the subcontractor itself is a[n]
[LBE]; and
(B) The subcontractor’s most recent annual
affidavit provided to the Commissioner pursuant
to subsection 4(a).
Phila. Code § 17-109(5)(a) (emphasis added).
Section 17-109(5)(a)(.4) of the Philadelphia Code makes clear that if
Carney required the services of LBE subcontractor(s) to complete the other 31% of
the contract work, Carney had to submit the LBE subcontractor(s)’ current LBE
certification and recent annual affidavit with its bid.13 The City and Carney agreed
that Carney did not submit a current certification or annual affidavit of any LBE
subcontractor(s) with its bid.
The City claimed that the Philadelphia Code, the City’s Local Bidding
Preferences for Procurement Contracts (LBE Regulations)14 and the bid documents,
13
To the extent Carney asserts that the reference in Section 17-109(5)(a)(.4) of the
Philadelphia Code to “a subcontractor” means it must submit the certification and affidavit with its
bid only if it intends to rely on a single subcontractor to complete the other 31% of the work,
Section 1902 of the Statutory Construction Act of 1972, which states that “[t]he singular shall
include the plural, and the plural, the singular[,]” 1 Pa.C.S. § 1902, belies such an argument.
14
Section 6 of the LBE Regulations similarly provides, in relevant part:
Bidder, in order to be eligible to receive the bid preference, must
submit with its bid the following information:
a. Current LBE certification number from the
[Procurement Commissioner];
b. If requested by [the Department], most recent annual
affidavit provided pursuant to Section 5 above; and
14
taken together, mandate that Carney merely certify with its bid submission that it will
comply with the requirement that 51% of the work performed on the contract be
performed by LBEs. The City further asserted that, since Section 17-109(5)(a)(.3) of
the Philadelphia Code ends with a period, Carney only had to submit the items
referred to in Section 17-109(5)(a)(.1), (.2) and (.3) of the Philadelphia Code with its
bid, and the separate requirement in Section 17-109(5)(a)(.4) of the Philadelphia
Code was not required at bid submission.
Under the Statutory Construction Act [of 1972 (SCA),15] it
is fundamental that ‘[t]he object of all interpretation and
c. A certification that, throughout the entirety of the
contract:
i. The LBE or a subcontractor will perform, on the
site with its own workforce, the majority of any work
(which shall mean work with a value of at least 51% of
the original total contract price) on the subject contract
within the geographic limits of the [C]ity; and
ii. The LBE or subcontractor will maintain within the
City a majority of the inventory or equipment that will
be used on the contract or the amount of inventory that
is customary for that industry; and
iii. The [LBE] will satisfy Sections 3(a), 3(b), 3(c),
and at least one of the requirements identified in 3(d)
above.
d. If the Bidder relies upon a subcontractor to meet the
requirements in subsection 6(c)(i) or 6(c)(ii), the Bidder
must submit the following:
i. A current certification from the Procurement
Commissioner that the subcontractor itself is a[n]
[LBE]; and
ii. Subcontractor’s most recent annual affidavit
provided pursuant to Section 5(a) [(relating to
annual recertification)] above.
LBE Regulations § 6.
15
1 Pa.C.S. §§ 1501-1991. Section 1504 of the SCA provides: “In all cases where . . .
anything is directed to be done by any statute, the directions of the statute shall be strictly
pursued[.]” 1 Pa.C.S. § 1504. Although the Philadelphia Code is an ordinance and not a statute,
this Court has declared that “[t]he rules of statutory construction are applicable to statutes and
ordinances alike.” In re Thompson, 896 A.2d 659, 669 (Pa. Cmwlth. 2006).
15
construction of statutes is to ascertain and effectuate the
intention of the General Assembly[,] and that [e]very
statute shall be construed, if possible, to give effect to all
its provisions.’ 1 Pa.C.S. § 1921(a). In this regard, the
[SCA] instructs that ‘[w]hen the words of a statute are
clear and free from all ambiguity, the letter of it is not to
be disregarded under the pretext of pursuing its spirit.’
1 Pa.C.S. § 1921(b). When, however, the words of the
statute are not explicit, the General Assembly’s intent is to
be ascertained by considering matters other than the
statutory language. 1 Pa.C.S. § 1921(c).
Phila. Entm’t & Dev. Partners, L.P. v. City of Phila., 939 A.2d 290, 294 (Pa. 2007)
(emphasis added). Moreover, “[w]here the language of a statute is explicit and clear,
this Court will not disturb the plain meaning of that language by resorting to the rules
of statutory construction.”16 Temple Ass’n of Univ. Prof’ls, Am. Fed’n of Teachers
Local 4531 AFL-CIO v. Temple Univ. of Commonwealth Sys. of Higher Educ., 582
A.2d 63, 65 (Pa. Cmwlth. 1990).
Section 17-109(5)(a) of the Philadelphia Code begins with “the
Commissioner shall award a [5%] bid preference . . . to any [LBE] that submits with
its bid: . . . .” Phila. Code § 17-109(5)(a). Thereafter are listed four parts – (.1), (.2),
(.3) and (.4). The items listed in all four parts must be submitted with the bid.
Subsection (.3) does not end with a semicolon like subsections (.1) and
(.2) because subsection (.3) contains additional subsections thereunder.17 Subsection
(.3)(C) ends with a period since it completes subsection (.3)’s inclusive criteria list
(of (A), (B) and (C)), as in subsection (.4). Moreover, the mere fact that subsection
(.3) ends with a period rather than a semicolon cannot subvert the plain meaning of
16
Because the Philadelphia Code language at issue in this appeal is not ambiguous, Carney’s
reliance in its brief to this Court on City Council’s interpretation during 2016 discussions related to
proposed amendments to Philadelphia Code Chapter 17 is misplaced.
17
Like in subsection (.4), a colon (rather than a semicolon) appropriately follows a complete
phrase and introduces the list that follows subsection (.3). Also, just as in subsection (.4), a period
ends the additional list. There is no proper place to put a semicolon after subsection (.3) in these
circumstances.
16
Section 17-109(5)(a) of the Philadelphia Code (i.e., a complete list of required
submissions). If such a conclusion was to be drawn, then the Philadelphia Code’s
careful delineation of subsection (.4) would be nullified. Certainly, if City Council
had intended the period after Section 17-109(5)(a)(.3) of the Philadelphia Code to
mean that (.4) was not required at the time of bid submission as the City contends, it
would have drafted the provision differently. Nevertheless, the plain meaning of
Section 17-109(5)(a) of the Philadelphia Code clearly mandates that Carney must
satisfy all four requirements with its bid if it relied upon a subcontractor to satisfy
the requirements in subparagraph (a)(.3)(A) or (a)(.3)(B) of that subparagraph.
Because Section 17-109(5)(a) of the Philadelphia Code is clear and unambiguous,
this Court need not look to the City’s LBE Regulations18 and bid documents for
clarification.
Neither Carney nor the City can choose to disregard Section 17-
109(5)(a)(.4) of the Philadelphia Code. The law is “well settled that [the City] has no
discretion to waive defects in the bidding process if the result would violate
applicable . . . city ordinance competitive bidding requirements.” Shaeffer v. City of
Lancaster, 754 A.2d 719, 722 (Pa. Cmwlth. 2000); see also Rainey v. Borough of
Derry, 641 A.2d 698 (Pa. Cmwlth. 1994); Conduit & Found. Corp. “When
competitive bidding is used and the procedures followed emasculate the benefits of
such bidding, . . . judicial intervention is proper.” Rainey, 641 A.2d at 702 (quoting
Am. Totalisator Co., Inc. v. Seligman, 414 A.2d 1037, 1041 (Pa. 1980)). Moreover,
“[i]n cases where public contract bidding irregularities are shown, it is proper for a
18
Notwithstanding, the LBE Regulations mirror and support this Court’s interpretation of
Section 17-109(5)(a) of the Philadelphia Code. In order for Carney to receive the LBE preference,
it was obligated to provide a current certification and annual affidavit of the LBE subcontractor and
the subcontractor’s most recent annual affidavit, which is the same requirement in Section 17-
109(5)(a)(.4) of the Philadelphia Code.
17
reviewing court to enjoin the contract awarded according to those faulty procedures.”
Stapleton v. Berks Cty., 593 A.2d 1323, 1332 (Pa. Cmwlth. 1991).
Based upon this Court’s strict reading of Section 17-109(5)(a) of the
Philadelphia Code, Carney had to fulfill the requirements in Section 17-109(5)(a)(.1),
(.2), (.3) and (.4) of the Philadelphia Code when it submitted its bid in order to
receive the LBE preference in accordance with the Philadelphia Code. It being
undisputed that Carney did not satisfy the specific LBE preference requirements,
Carney should not have received the benefit thereof. Without the LBE preference,
Carney was not the lowest bidder. Rather, Appellants submitted the Project’s lowest
bid. Accordingly, Appellants are likely to prevail on the merits and their right to
relief is clear.
Based upon the foregoing, there were no apparently reasonable grounds
to support the trial court’s conclusion that Appellants failed to establish that they are
likely to prevail on the merits and their right to relief is clear. SPTR, Inc.
2. Injunction Is Necessary To Prevent Immediate And
Irreparable Harm That Cannot Be Compensated
Adequately By Damages
In order to prevail on the Petition, Appellants also had to demonstrate
that an injunction is necessary to prevent immediate and irreparable harm that cannot
be adequately compensated by money damages. SPTR, Inc. The trial court held:
Appellant[s] d[id] not succeed in meeting the first
prerequisite as they have failed to show that this
injunction is necessary to prevent immediate and
irreparable harm that damages cannot adequately
compensate. Specifically, at the hearing before the
Commonwealth Court, [Grace] testified that, although the
Project is important, it is not an emergency, and that the
City and [Carney] had not yet even conducted their pre-
construction meeting. Moreover, damages can adequately
compensate Appellant[s] for whatever work may have been
done between April 1, 2019, when the Go-Ahead
18
Agreement was issued by the City[,] and April 17, 2019,
when the City notified Appellant[s] to cease all work
related to the Project.
Trial Ct. August 28, 2019 Op. at 5.
Notwithstanding Grace’s August 7, 2019 testimony that the Project is
not an emergency, and that the City and Carney had not yet conducted their pre-
construction meeting, see August 7, 2019 Notes of Testimony (N.T.) at 48, 53, 55,
Carney and the City had expressed their clear intention to quickly proceed with the
Project, all the while fully aware of the ongoing litigation and resulting potential
liability of the Project’s increased costs upon the taxpayers.19 Accordingly, the harm
is immediate.
Relative to irreparable harm, the Pennsylvania Supreme Court has
declared that “[f]or one to continue [] unlawful conduct constitutes irreparable
injury[,]” and “[s]preading unlawful conduct is irreparable injury of the most serious
nature[.]” Pa. Pub. Util. Comm’n v. Israel, 52 A.2d 317, 321 (Pa. 1947); see also
Philips Bros. Elec. Contractors, Inc. v. Valley Forge Sewer Auth., 999 A.2d 652 (Pa.
Cmwlth. 2010). Our Supreme Court has further ruled:
[W]here the offending conduct sought to be restrained
through a preliminary injunction violates a statutory
mandate, irreparable injury will have been established. See
Commonwealth v. Coward, . . . 414 A.2d 91 . . . ([Pa.]
1980) (holding that where a statute prescribes certain
activity, the court need only make a finding that the illegal
activity occurred to conclude that there was irreparable
injury for purposes of issuing a preliminary injunction); . . .
Israel . . . (holding that when the Legislature declares
certain conduct to be unlawful, it is tantamount to calling it
injurious to the public, and to continue such unlawful
conduct constitutes irreparable injury for purposes of
seeking injunctive relief); Commonwealth ex rel. Corbett v.
19
On August 15, 2019, the same date this Court denied the First Emergency Application on
procedural grounds, the City and Carney conducted their pre-construction meeting, and Carney
proceeded with construction on the Project.
19
Snyder, 977 A.2d 28 (Pa. Cmwlth. 2009) (affirming
issuance of a preliminary injunction and finding that
irreparable harm was presumed where there was a credible
violation of the state consumer protection statute).
SEIU Healthcare, 104 A.3d at 508.
Here, the purported unlawful conduct is the City’s and Carney’s
violation of the Philadelphia Code.20 In Shaeffer, this Court ruled specifically
regarding competitive bidding that “[s]tatutory violations are sufficiently injurious to
constitute irreparable harm, and a preliminary injunction may be upheld based upon
the violation of competitive bidding requirements[.]”21 Id. at 723 (citation omitted).
The Shaeffer Court reached that conclusion without considering whether monetary
damages could compensate the second lowest bidder for any losses incurred if the
injunction was denied. Rather, the Court held, based solely on the fact that the lowest
bidder’s bid “contained an unlawful deviation from the [bid s]pecifications and
violated competitive bidding requirements[,]” that “[t]he irreparable harm
requirement was satisfied[.]” Id. at 723. The harm in the instant case is likewise
irreparable.
Based upon the foregoing, there were no apparently reasonable grounds
to support the trial court’s conclusion that Appellants failed to establish that this
injunction is necessary to prevent immediate and irreparable harm that damages
cannot adequately compensate.
Having determined that Appellants satisfied two of the six prerequisites
to obtain a preliminary injunction, SPTR, Inc., and since Appellants and Carney
addressed all six prerequisites in their briefs, this Court will examine the remaining
four factors. See SEIU Healthcare.
20
“A municipal ordinance is in reality a statute[.]” Cloverleaf Trailer Sales Co. v. Borough
of Pleasant Hills, Allegheny Cty., 76 A.2d 872, 875 (Pa. 1950).
21
Although Shaeffer involved the violation of mandatory bid requirements, because Section
17-105(a)(.4) of the Philadelphia Code is a mandatory bid requirement, Shaeffer is controlling.
20
3. Greater Injury Would Result From Refusing The
Injunction Than From Granting It, And,
Concomitantly, The Issuance Of An Injunction Will
Not Substantially Harm Other Interested Parties In
The Proceedings
Appellants assert that greater injury would result to them and the City’s
taxpayers than the City and Carney if the injunction is denied.
Preliminarily,
[l]aws that require competitive bidding for public projects
seek to apportion awards fairly and economically.[22]
Mandatory compliance with statutory procedures and bid
instructions serves this goal in two ways. Initially, clear-cut
ground rules for competition guarantee that none of the
contractors will gain an undue advantage through better
information of the bid solicitor’s operation. Second, the
strict adherence principle lessens the possibility of fraud
and favoritism. In the opinion of the Pennsylvania
judiciary, moreover, the appearance of propriety is so
important that genuine deviations may not be tolerated even
if all available evidence suggests that the parties acted in
good faith.
Hanover Area Sch. Dist. v. Sarkisian Bros., Inc., 514 F. Supp. 697, 703 (M.D. Pa.
1981) (citations omitted); see also Jay Twp. Auth. v. Cummins, 773 A.2d 828 (Pa.
Cmwlth. 2001).
By not requiring Carney to submit the documentation required by
Section 17-109(5)(a)(.4) of the Philadelphia Code, “which exist[s] to invite
competition and to guard against favoritism, improvidence, extravagance, fraud and
22
This Court has held:
[C]ompetitive bidding serves to enhance competition which, in turn,
encourages offering services at the best price. Thus, it is important
that the bidding process foster confidence among potential bidders
that their bids will be considered fairly and that they will not be
denied a substantial benefit afforded to their competitors.
Marx v. Lake Lehman Sch. Dist., 817 A.2d 1242, 1247 (Pa. Cmwlth. 2003) (citation omitted).
21
corruption in the award of municipal contracts[,]” Shaeffer, 754 A.2d at 723,
Appellants and the other bidders did not “enjoy the same opportunity for open and
fair competition.” Hanisco, 41 A.3d at 123. Moreover, the City and Carney
conducted their pre-construction meeting on August 15, 2019, and Carney proceeded
to work on the Project. By denying the injunction, the trial court authorized the City
and Carney to forge ahead on the Project obtained by unfair advantage, to the
detriment of Appellants and the other bidders, creating the appearance of impropriety
by the City and Carney. In addition, while fully aware of the ongoing litigation and
resulting potential consequences, the City and Carney proceeded with utmost speed.
Therefore, granting the injunction would not substantially harm Carney or the City.
Conversely, if the trial court had granted the injunction, Carney’s work on the Project
would have ceased until the trial court decided the merits of Appellants’ case.
The City and Carney had every opportunity to wait until the trial court
decided the merits of Appellants’ case since, as the City’s own witness testified, the
Project was “not an emergency bid.” August 7, 2019 N.T. at 53. By waiting, the
City and Carney would have maintained an appearance of propriety and also
demonstrated the good faith exalted by competitive bidding laws. Thus, greater
injury resulted from refusing the injunction than by granting it, and there were no
apparently reasonable grounds on which the trial court could have held otherwise.
4. The Injunction Will Properly Restore The Parties To
Their Status As It Existed Immediately Prior To The
Alleged Wrongful Conduct
In the Petition, Appellants sought to “enjoin[] the City from awarding
[the] contract to [Carney] for the [Project] in violation of public bidding laws pending
a determination of the claims on the merits.” Petition at 17 (R.R. at 44a). Because
Appellants’ Complaint included a general prayer for relief, the City’s awarding of the
22
contract did not moot this controversy. See Abbonizio v. City of Phila. (Pa. Cmwlth.
No. 974 C.D. 2019, filed September 30, 2019), slip op. at 5-8. Courts may grant any
relief that is consistent with the action’s theory and purpose, see id., including
Appellants’ request to “enjoin[] the City and Carney from proceeding with
construction on the Project in violation of public bidding laws pending a
determination of Appellants’ appeal on the merits.” Second Emergency Appl. at 41;
see also O.R. Item 29 at 2, 21.
The Pennsylvania Supreme Court has ruled: “The purpose of a
preliminary injunction is to preserve the status quo as it exists or previously existed
before the acts complained of, thereby preventing irreparable injury or gross
injustice.” Maritrans GP Inc. v. Pepper, Hamilton & Scheetz, 602 A.2d 1277, 1286
(Pa. 1992) (bold emphasis added; original italic emphasis omitted); see also Santoro
v. Morse, 781 A.2d 1220 (Pa. Super. 2001).
Here, the acts complained of occurred in April 2019, when the City
disregarded Section 17-109(5)(a)(.4) of the Philadelphia Code, granted Carney the
LBE preference, and awarded Carney the contract. Before that time, only Appellants
had incurred costs pursuant to their work under the Go-Ahead Agreement, and no
public funds had been expended.23 The status quo would have been maintained if
Carney stopped work on the Project pending the trial court’s decision on the merits of
Appellants’ Complaint. Granting Appellants’ requested injunctive relief would have
properly enjoined the City and Carney from changing the status quo in the meantime,
and there were no apparently reasonable grounds on which the trial court could have
held otherwise.
23
Although Appellants began work on the Project, the Go-Ahead Agreement clearly
specified that “no payments can be made until the contract is fully conformed and the purchase
order issued.” R.R. at 468a.
23
5. An Injunction Is Reasonably Suited To Abate The
Offending Activity
Appellants maintain that an injunction was reasonably suited to abate the
offending activity, because it would have prevented the City from proceeding under a
contract with Carney that violates the City’s public bidding laws.
The offending activity in this case was the City awarding the contract to
Carney and Carney proceeding on the Project despite not complying with required
subcontractor documentation and, thus, not being the lowest bidder. Enjoining the
City and Carney from proceeding with construction on the Project in violation of
public bidding laws pending the trial court’s determination of Appellants’ Complaint
on the merits was reasonably suited to abate the offending activity, and there were no
apparently reasonable grounds on which the trial court could have held otherwise.
6. An Injunction Will Not Adversely Affect The Public
Interest
Finally, Appellants claim that an injunction would not adversely affect
the public interest but, rather, would have the effect of ensuring that the City’s
procurement process complies with the City’s public bidding requirements, and that
the contract for the Project is legally awarded to the lowest responsive and
responsible bidder.
Section 17-109(1) of the Philadelphia Code sets forth what City Council
intended by granting an LBE preference – to encourage businesses to locate and
remain in the City and positively impact the City’s economy by creating local jobs
and increasing tax revenue. See Phila. Code § 17-109(1). Clearly, the goal of
Section 17-109(5)(a) of the Philadelphia Code is to benefit the public, particularly
bidders and City taxpayers.
Denying the injunction degraded the bidding process City Council
intended to be fair and free from favoritism, fraud and corruption, had a chilling
24
effect on potential bidders, and allowed the Project’s costs and, thus, taxpayers’
liability, to increase. “This is, after all, [partially] a taxpayer’s suit which alleges that
the irregularities in the process defeated the safeguards that competitive bidding was
designed to insure. [This Court] believe[s] that the threat to the public fisc in this
case [is] real . . . .” Stapleton, 593 A.2d at 1332.
Moreover, disregarding the express provisions of Section 17-109(5)(a)
of the Philadelphia Code is unlawful. The Pennsylvania Supreme Court has held:
“When [City Council] declares certain conduct to be unlawful it is tantamount in law
to calling it injurious to the public.” Coward, 414 A.2d at 98 (quoting Israel, 52 A.2d
at 321); see also SEIU Healthcare. Certainly, the public’s interest is in having duly
adopted ordinances enforced. Ultimately, prudence, not speed, is in the taxpayers’
best interests.
Under the circumstances presented to the trial court, an injunction would
have ensured the public’s confidence that the Philadelphia Code’s express provisions
were upheld, that contractors cannot gain an advantage by disregarding the LBE
preference criteria, and that taxpayers’ funds are being protected, and there were no
apparently reasonable grounds on which the trial court could have held otherwise.
Having determined that Appellants satisfied the six criteria necessary to
obtain a preliminary injunction, this Court concludes that the trial court erred by
denying the Petition.
Conclusion
Because Appellants satisfied the prerequisites for a preliminary
injunction, and this Court can identify no reasonable grounds for the trial court to
have denied such relief, we reverse the trial court’s July 8, 2019 order, and issue a
preliminary injunction enjoining the City and Carney from proceeding with
25
construction on the Project pending the trial court’s decision on Appellants’ case on
the merits. See SEIU Healthcare.
___________________________
ANNE E. COVEY, Judge
Judge Fizzano Cannon did not participate in the decision in this case.
26
IN THE COMMONWEALTH COURT OF PENNSYLVANIA
Anthony Abbonizio and C. Abbonizio :
Contractors, Inc., :
Appellants :
:
v. :
:
City of Philadelphia and Thomas P. : No. 974 C.D. 2019
Carney, Inc. :
ORDER
AND NOW, this 5th day of June, 2020, the Philadelphia County
Common Pleas Court’s (trial court) July 8, 2019 order is REVERSED.
The City of Philadelphia (City) and Thomas P. Carney, Inc. are hereby
ENJOINED from proceeding with the non-emergent construction project described as
the City Water Department’s Residuals Lagoon Closure Plan and Raw Water Basin
Dredging at Queen Lane Water Treatment Plant, pending the trial court’s decision on
the merits of Anthony Abbonizio’s and C. Abbonizio Contractors, Inc.’s case.
___________________________
ANNE E. COVEY, Judge