[J-23-2015] 

IN THE SUPREME COURT OF PENNSYLVANIA 

EASTERN DISTRICT 

SAYLOR, C.J., EAKIN, BAER, TODD, STEVENS, JJ. 

CLIPPER PIPE & SERVICE, INC., 

Appellee 

v. 

THE OHIO CASUALTY INSURANCE CO.; 

CONTRACTING SYSTEMS, INC. II, 

Appellant 

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No. 59 EAP 2014 

Appeal from the Order granting Petition 

for Certification of Question of Law 

ARGUED: April 7, 2015 

OPINION 

MR. CHIEF JUSTICE SAYLOR DECIDED: JUNE 15, 2015 

We accepted certification from the United States Court of Appeals for the Third 

Circuit to determine whether a Pennsylvania statute governing payments to contractors 

and subcontractors applies in the context of a public works project. 

The subject statute is the Contractor and Subcontractor Payment Act,1 which 

confirms and establishes certain rights and duties among “owners,” “contractors,” and 

“subcontractors” with respect to “construction contracts.” 73 P.S. §502. Within the 

enactment, “owner” is a pivotal term, given its centrality and pervasive appearance. For 

instance, “contractor” is defined as “[a] person authorized or engaged by an owner to 

improve real property.” Id. (emphasis added). 

 

1

 Act of Feb. 17, 1994, P.L. 73, No. 7 (as amended, 73 P.S. §§501-516) (“CASPA”). 
[J-23-2015] - 2 

Under CASPA, “owner” is defined, in pertinent part, as “[a] person who has an 

interest in the real property that is improved and who ordered the improvement to be 

made.” Id. §502 (emphasis added). “Person,” in turn, is defined as “[a] corporation, 

partnership, business trust, other association, estate, trust foundation or a natural 

individual.” Id. (emphasis added). 

 In 2010, the United States Department of the Navy entered into an agreement 

with Contracting Systems, Inc. II (“CSI”), per which the latter served as the general 

contractor for the construction of an addition to, and renovations of, the Navy/Marine 

Corps Reserve Training Center in the Lehigh Valley. CSI, in turn, subcontracted with 

Appellee, Clipper Pipe & Service, Inc. (“Clipper”), for the performance of mechanical 

and heating, ventilation, and air conditioning work. 

 Subsequently, Clipper filed suit against CSI and its surety, the Ohio Casualty 

Insurance Company (collectively “Appellants”), in the United States District Court for the 

Eastern District of Pennsylvania, asserting that CSI had failed to pay approximately 

$150,000 to Clipper, per the terms of their agreement. Among other claims, Clipper 

advanced one under CASPA. 

Appellants moved for summary judgment, arguing that CASPA does not apply to 

public works projects, because a governmental entity does not qualify as an “owner” 

under the statutory definition, as such an entity is neither a “person” nor an “other 

association.” 73 P.S. §502. Appellants acknowledged that a federal district court had 

predicted that Pennsylvania courts would find that a governmental entity may be an 

owner for purposes of CASPA. See Scandale Associated Builders & Eng’rs, Ltd. v. Bell 

Justice Facilities Corp., 455 F. Supp. 2d 271, 281 (M.D. Pa. 2006). They highlighted, 

however, the inconsistency of such prediction with several actual decisions issued by 

Pennsylvania state courts, albeit from the common pleas level. See, e.g., Hoffmeister v. 
[J-23-2015] - 3 

Skepton Constr., Inc., 55 Northampton Cnty. Rep. 46, 48 (2006) (reasoning that CASPA 

did not apply to a Commonwealth public works project, because “a ‘person’ is 

specifically defined in [CASPA] with a limited list of entities that does not include any 

agency of state or local government”), aff’d per curiam, 943 A.2d 327 (Pa. Super. 2007). 

Along these lines, Appellants noted that Pennsylvania courts had also considered 

CASPA in concert with Subchapter D of Chapter 39 of the Commonwealth Procurement 

Code,2 commonly denominated the “Prompt Pay Act,” another statutory regime directed 

at promoting prompt payment to contractors and subcontractors. See, e.g., Mastercraft 

Woodworking Co. v. Jim Lagana Plumbing & Heating Inc., 9 Pa. D. & C. 5th 251, 259-

61 (C.P. Berks 2009). In this regard, Appellants explained, those courts had concluded 

that the Prompt Pay Act – and not CASPA – addresses public works projects. See, 

e.g., id.

The federal district court denied relief on Appellants’ motion. Among other 

aspects of its rationale, the court followed Scandale’s reasoning that a governmental 

entity may be an “owner” under CASPA, since the statutory definition of “person” does 

not exclude the federal government, and the purpose of CASPA is to protect contracting 

parties. 

Clipper prevailed at an ensuing jury trial, and the district court awarded interest, 

penalties, and counsel fees, such as are made available by CASPA. See 73 P.S. 

§§505(d), 512. Appellants lodged an appeal in the United States Court of Appeals for 

the Third Circuit. Per this Court’s internal operating procedures, the federal appeals 

court subsequently applied for certification of a question of law, namely, “does [CASPA] 

apply to a project where the owner is a governmental entity, such as the federal 

 

2

 Act of May 15, 1998, P.L. 358, No. 57 §§3931-3939 (as amended, 62 Pa.C.S. §§3931-

3939). 
[J-23-2015] - 4 

government in this case?” Petition for Certification in Clipper Pipe & Service, Inc. v. 

Ohio Cas. Ins. Co., No. 14-1716 (3d Cir. Oct. 24, 2014), at 8. 

Presently, Appellants maintain that governmental bodies cannot be “owners” for 

purposes of CASPA, because the word “government” does not appear in the definition, 

and it is the Prompt Pay Act, not CASPA, which expressly governs public works 

projects. To the degree this is not plain from the face of CASPA, Appellants invoke 

principles of statutory construction. For example, Appellants urge that, under the 

doctrine of ejusdem generis, the phrase “other association,” as used in the definition of 

“person” (and, derivatively, “owner”) should take its meaning from the words which 

precede it, i.e., “[a] corporation, partnership, [or] business trust,” 73 P.S. §502. Accord

1 Pa.C.S. §1903(b) (“General words shall be construed to take their meanings and be 

restricted by preceding particular words.”). 

Additionally, Appellants note that the term “association,” as utilized in statutes 

enacted prior to December 7, 1994, refers to “any form of unincorporated enterprise 

owned by two or more persons other than a partnership or limited partnership.” 1 

Pa.C.S. §1991. According to Appellants, this definition is obviously directed to nonpublic entities. Finally, Appellants believe that it would be untenable for both CASPA 

and the Prompt Pay Act to apply simultaneously to a construction project, given that 

there are substantial differences in: the timing for provision of required notices, 

compare 73 P.S. §511, with 62 Pa.C.S. §3934; the rate of interest on delayed 

payments, compare 73 P.S. §505, with 62 Pa.C.S. §3932(c); and the burden of proof 

associated with penalty and attorneys’ fee awards, compare 73 P.S. §512, with 62 

Pa.C.S. §3935. Accord, e.g., E. Coast Paving & Sealcoating, Inc. v. N. Allegheny Sch. 

Dist., 111 A.3d 220, 232 (Pa. Cmwlth. 2015) (concluding, based on the differences 

between CASPA and the Prompt Pay Act, that the latter, “not CASPA, governs 
[J-23-2015] - 5 

construction contracts between a government agency . . . and a contractor”); 

Hoffmeister, 55 Northampton Cnty. Rep. at 47 (“It is not reasonable that the General 

Assembly intended to regulate conduct with two different requirements for the same 

entitlement to a penalty for a contractor’s late payment to a subcontractor.”).3 

Finally, Appellants contend that application of CASPA to federal public works 

projects would contravene the principle of federal supremacy, per which states may not 

regulate the federal government. See, e.g., North Dakota v. United States, 495 U.S. 

423, 434, 110 S. Ct. 1986, 1994 (1990) (“State law may run afoul of the Supremacy 

Clause in two distinct ways: The law may regulate the [federal] Government directly or 

discriminate against it, . . . or it may conflict with an affirmative command of Congress.” 

(citing, inter alia, M’Culloch v. Maryland, 17 U.S. 316 (1819))). 

Clipper, on the other hand, does not accept that the identity of the owner is 

fundamental to the application of CASPA. See, e.g., Brief for Appellee at 4 (“The fact 

that a governmental entity is an owner is irrelevant where the contract at issue does not 

include a governmental entity as a party.”). Along these lines, Clipper references 

Imperial Excavating & Paving, LLC v. Rizzetto Construction Management, Inc., 935 

A.2d 557 (Pa. Super. 2007), as a decision which applied the terms of CASPA in 

determining the respective rights of a contractor and subcontractor on a public project. 

To the degree that identity is relevant to the status of an “owner” under CASPA, Clipper 

maintains that the federal government is both a “person” and an “other association,” 

since “the federal government is nothing more than an association of its citizens.” Brief 

 

3

 In this regard, Appellants also reference the principle of statutory construction 

requiring that specific provisions control over general ones. See Brief for Appellants at 

26 (“Because the Prompt Pay Act is the more specific statute, and was enacted after 

the more general CASPA, the Rules of Statutory Construction require that the more 

specific language in the Prompt Pay Act prevail over the general language of ‘other 

association’ in CASPA.” (relying upon 1 Pa.C.S. §1933)). 
[J-23-2015] - 6 

for Appellee at 5; accord Scandale, 455 F. Supp. 2d at 281. According to Clipper, this 

approach is consistent with the policy of liberal construction to be implemented in 

discerning the meaning of ambiguous remedial statutes. See 1 Pa.C.S. §1928(c). 

Clipper also stresses the salient policy underlying CASPA -- in terms of 

protecting contractors and subcontractors and encouraging fair dealing among the 

parties to a construction contract – and observes that such salutary aims should not be 

confined to private projects. See, e.g., Brief for Appellee at 16 (“The manifest intention

of the General Assembly was to protect subcontractors from the exact type of conduct 

[in which] a jury determined CSI engaged.”). Furthermore, while recognizing that 

application of CASPA to claims against the federal government might raise supremacy 

concerns, Clipper suggests that such concerns are alleviated since such application 

would be preempted by the federal Prompt Pay Act, 31 U.S.C. §§3901-3907. Clipper 

does not find the Commonwealth-level Prompt Pay Act relevant, since it is addressed to 

contracts involving state and local governmental units, see 62 Pa.C.S. §3902, not the 

federal government. 

Finally, Clipper develops that, pursuant to recent amendments to Section 102 of 

the Associations Code,4 the term “association” expressly excludes governmental 

entities. See Act of Oct. 22, 2014, P.L. 2640, No. 172 (amending, inter alia, 15 Pa.C.S. 

§102). It is Clipper’s position that such modification bolsters the conclusion that the 

Legislature did not previously intend to exclude governmental bodies from CASPA’s 

reach. 

Upon review, we agree with Appellants’ position that CASPA does not apply in 

the context of public works projects. In the first instance, we find Clipper’s and the 

federal district courts’ proposition that the General Assembly may have intended the 

 

4

 Act of Dec. 21, 1988, P.L. 1444, No. 177 (as amended, 15 Pa.C.S. §§101-9507). 
[J-23-2015] - 7 

term “association” to encompass governments or governmental units to be 

unconvincing. Moreover, the United States and its Department of the Navy are 

dissimilar to a “corporation,” “partnership” “business trust,” “estate,” “trust foundation,” 

and “natural individual,” among which the term “association” appears. Cf. DEP v. 

Cumberland Coal Res., LP, ___ Pa. ___, ___, 102 A.3d 962, 976 (2014) (explaining 

that, per the doctrine of ejusdem generis, catchall phrases “should not be construed in 

their widest context”). 

Even if this were not the case, another relevant rule of statutory construction 

prescribes that statutes in derogation of sovereignty should be construed strictly in favor 

of the sovereign. See, e.g., Meyer v. Cmty. Coll. of Beaver Cnty., ___ Pa. ___, ___, 93 

A.3d 806, 814 (2014). See generally 3 SUTHERLAND STATUTORY CONSTRUCTION §62:1 

(7th ed. 2015) (“Statutory provisions which are written in such general language that 

they are reasonably susceptible to being construed as applicable both to the 

government and to private parties are subject to a rule of construction which exempts 

the government from their operation in the absence of other particular indicia supporting 

a contrary result in particular instances.”). This approach derives, in part, from the 

immunity accorded to the government at common law (and presently reaffirmed by 

statute, see infra note 6). See generally 3 SUTHERLAND STATUTORY CONSTRUCTION

§62:1 (“[T]he rule exempting the sovereign from the operation of the general provisions 

of a statute is premised on a policy of preserving for the public the efficient, unimpaired 

functioning of government.”).5 It is also grounded on the assumption that non-specific

 

5 Accord Vt. Agency of Natural Res. v. U.S. ex rel. Stevens, 529 U.S. 765, 780, 120 S. 

Ct. 1858, 1866 (2000) (“We must apply to this text our longstanding interpretive 

presumption that ‘person’ does not include the sovereign.” (citations omitted)); United 

States v. Bd. of Fin. & Revenue, 369 Pa. 386, 396-97, 85 A.2d 156, 163 (1951) (“[T]he 

word person is never generally construed to include a sovereign whether the United 

States or a State.” (internal citations omitted)). 
[J-23-2015] - 8 

statutes are most often directed to the affairs of the citizenry. See id. (“There is a 

further basis for the rule in that the purpose of most legislation is to govern, i.e., to direct 

the application of the power of government to arrange the affairs of people who are 

subject to it. For this reason most statutes are intended and understood to apply to 

members of the public instead of the government itself.”). Per the application of this 

principle, the federal government is not an “association” or a “person” or, derivatively, an 

“owner” for purposes of CASPA.6

 

6

 In the Meyer decision, cited previously, the relevant principle of narrow construction 

was applied upon review of a legislative enactment which predated this Court’s decision 

to abrogate common-law sovereign immunity. See Mayle v. Pa. Dep’t of Highways, 479 

Pa. 384, 406, 388 A.2d 709, 720 (1978). Thus, strictly speaking at least, it remains an 

issue of first impression whether the precept should be extended into the context of a 

post-abrogation statute such as CASPA. Accordingly, we pause to explain why 

continued application is appropriate. 

Very soon after the issuance of Mayle, the General Assembly reaffirmed and reinstated 

the doctrine of sovereign immunity through a legislative enactment. See 1 Pa.C.S. 

§2310. Per the statutory regime, the Commonwealth “shall continue to enjoy sovereign 

immunity . . . and remain immune from suit except as the General Assembly shall 

specifically waive the immunity.” Id. (emphasis added). Notably, this Court already has 

implemented this plain directive to maintain the traditional strict construction of statutes 

in derogation of sovereignty. See, e.g., Pyeritz v. PSP, 613 Pa. 80, 94, 32 A.3d 687, 

696 (2011) (“The legislature's intent in enacting the Sovereign Immunity Act was to 

shield government from liability except as provided for in the statute itself, and we must 

apply a rule of strict construction in interpreting the exceptions.” (emphasis added)). 

Furthermore, although Appellants have not specifically referenced the strict-construction 

precept in their arguments, application of the principle is entirely consistent with 

Appellants’ position that general statutory terms such as “person” and “association” 

should not be construed to encompass the Commonwealth, at least in the absence of 

some specific evidence of a legislative intention supporting such an expansive 

construction. Moreover, we believe that our present reference to the relevant principle 

of narrow construction is salutary in terms of affording broader guidance, particularly 

given that several federal district courts have construed general terms to encompass 

the Commonwealth in a context in which there is no specific evidence that the 

Legislature intended such a construction. See, e.g., Scandale, 455 F. Supp. 2d at 281. 
[J-23-2015] - 9 

We recognize that the government is not directly involved in the present dispute 

between CSI, a contractor in the generic sense, and its subcontractor, Clipper. 

Nevertheless, our analysis circles back to the centrality of the concept of an “owner” to 

CASPA. Where there is no “owner” for purposes of CASPA -- because a “person” did 

not commission the construction in the first instance, 73 P.S. §502 (defining “owner” in 

terms of a person with an interest in real estate) -- there also can be no “contractor” 

under the statute, given that a “contractor” must be engaged by an “owner.” Id. 

Whether by intention or oversight, the Legislature simply did not design CASPA to apply 

independently to subcontracts in scenarios in which the foundational contract resides 

outside its boundaries. Thus, although we do not discount that the policy of CASPA 

would seem to be served by applying it to the present circumstances, such application 

is too disharmonious with the statutory mechanics to support the extension.7

In terms of the soon-to-be-effective amendment to the Associations Code, which 

will indicate expressly that the term “association” does not encompass governmental 

units, we differ with Clipper’s assumption that this necessarily reflects changed 

legislative intent. Other jurisdictions recognize that the purpose of amendments, in fact, 

may be to clarify what the governing legislature body intended from the outset.8 Indeed, 

 

7

 In a similar vein, while recognizing the remedial nature of CASPA, we conclude that 

the policy of liberal construction has its limits as well. 

8

 Along these lines, the Michigan Supreme Court has explained that the principle 

suggested by Clipper: 

is a rule for construction of the amendment when ... the 

meaning of the statute before amendment is settled and the 

question presented is the meaning and effect to be given the 

amendment. The rule is not applied in reverse for the 

purpose of determining the meaning of the statute before 

amendment by presuming that it must have been something

different than that which is the clear intent of the statute after 

(Rcontinued) 
[J-23-2015] - 10 

interpretive judicial decisions, such as the federal district courts’ opinions pertinent to 

this case, are sometimes the impetus for such clarification. 

 In summary, we conclude that CASPA does not apply to a construction project 

where the owner is a governmental entity. 

 The matter is returned to the Third Circuit. 

 

 Messrs. Justice Eakin and Baer, Madame Justice Todd and Mr. Justice Stevens 

join the opinion. 

 

(continuedR) 

the amendment. ... While in many and perhaps most 

instances it undoubtedly is the legislative intent, in enacting 

an amendment, to change existing law, there are, as 

undoubtedly, other instances, particularly if uncertainty exists 

as to the meaning of a statute, when amendments are 

adopted for the purpose of making plain what the legislative 

intent had been all along from the time of the statute's 

original enactment. 

In re Detroit Edison Co., 87 N.W.2d 126, 130 (Mich. 1957) (emphasis added); accord

Colonial Pipeline Co. v. Neill, 251 S.E.2d 457, 461 (N.C. 1979) (“In construing a statute 

with reference to an amendment, it is presumed that the Legislature intended either (1) 

to change the substance of the original act or (2) to clarify the meaning of it.”).