Case Name: Olympic, Inc., operating and doing business under the name of Olympic Lounge & Restaurant, Appellants v. McKeesport Municipal Water and City of McKeesport, Appellees; Earl Miller, on behalf of himself and all other persons similarly situated, Appellant v. McKeesport Municipal Water and City of McKeesport, Appellees
Court: Commonwealth Court of Pennsylvania
Jurisdiction: Pennsylvania
Decision Date: 1987-02-19
Citations: 104 Pa. Commw. 107
Docket Number: Appeals, No. 1176 C.D. 1985 and 1177 C.D. 1985
Parties: Olympic, Inc., operating and doing business under the name of Olympic Lounge & Restaurant, Appellants v. McKeesport Municipal Water and City of McKeesport, Appellees. Earl Miller, on behalf of himself and all other persons similarly situated, Appellant v. McKeesport Municipal Water and City of McKeesport, Appellees.
Judges: before Judges Craig and Palladino, and Senior Judge Kalish, sitting as a panel of three.
Reporter: Pennsylvania Commonwealth Court Reports
Volume: 104
Pages: 107–114

Head Matter:
521 A.2d 95
Olympic, Inc., operating and doing business under the name of Olympic Lounge & Restaurant, Appellants v. McKeesport Municipal Water and City of McKeesport, Appellees. Earl Miller, on behalf of himself and all other persons similarly situated, Appellant v. McKeesport Municipal Water and City of McKeesport, Appellees.
Argued October 6, 1986,
before Judges Craig and Palladino, and Senior Judge Kalish, sitting as a panel of three.
Randy L. Rayl, with him, Cyril H. Wecht and Leonard M. Mendelson, for appellants.
Frederick N. Egler, Jr., with him, Ronald H. Heck and Gregory L. Fitzpatrick, Egler, Anstandig, Garrett & Riley, for appellee, McKeesport Municipal Water Authority.
Patrick J. Shannon, for appellee, City of McKeesport.
February 19, 1987:

Opinion:
Opinion by
Judge Palladino,
Earl Miller, on behalf of all persons who allegedly were physically injured by a giardia infestation of the McKeesport water system, and Olympic, Inc., on behalf of all users of the giardia infested water who allegedly were economically damaged (collectively Appellants), appeal from orders of the Court of Common Pleas of Allegheny County (trial court) which sustained preliminary objections of the City of McKeesport and the McKeesport Municipal Water Authority (collectively Appellees) and dismissed Appellants' amended complaints with prejudice.
Appellants brought suit alleging that Appellees (1) negligently maintained and operated a municipal water facility which caused an outbreak of giardiasis resulting in harm to Appellants, and (2) breached a contract between the parties by failing to provide Appellants with reasonably clean and safe water, causing damage to Appellants. Appellees made preliminary objections to the claims on the grounds that suit against them was barred by the Political Subdivision Tort Claims Act (Tort Claims Act). The trial court sustained the preliminary objections with leave to amend.
Appellants filed amended complaints, adding as an alternative theory of liability that Appellees' actions were taken in their "proprietary capacity" and, there fore, outside the protection of the Tort Claims Act. The trial court again sustained Appellees' preliminary objections on the basis of governmental immunity and dismissed Appellants' suits with prejudice. Appellants, asserting that Appellees are not immune from suit, appealed to this Court.
Appellants contend that: (1) their negligence claims fall under the exceptions to governmental immunity found in Section 8542 of the Tort Claims Act, 42 Pa. C. S. §8542; (2) breach of contract claims are outside the scope of the Tort Claims Act; (3) the delivery of water to the public is a "proprietary" function rather than a "governmental" function and, therefore, not encompassed by the Tort Claims Act; and (4) Section 306 of the Municipality Authorities Act provides a waiver of sovereign immunity under the Tort Claims Act in suits against municipal authorities. We find no merit in Appellants' contentions and affirm the dismissal of their suit on the basis that the Tort Claims Act confers immunity upon Appellees.
Appellants' first and second contentions were addressed by this Court in Gall v. Allegheny County Health Department, 98 Pa. Commonwealth Ct. 175, 182, 510 A.2d 926, 929 (1986), where we held that the Tort Claims Act confers immunity upon Appellees, as municipalities, and "that there are no implied warranties of merchantability or fitness in connection with the sale or supply of water." In this case Appellants did not categorize their breach of contract claim as a breach of implied warranties. Appellants claim that Appellees' breach was a failure to provide "reasonably clean and safe water." This is no more than a claim that the implied warranties of fitness and merchantability were breached and, accordingly, is barred by Gall.
Appellants' third contention, that the common law distinction between proprietary and governmental activities still exists after the enactment of the Tort Claims Act, was recently rejected in Faiella v. Bartoles, 102 Pa. Commonwealth Ct. 258, 517 A.2d 1019 (1986). In Faiella this Court held: "The current statutory exceptions to governmental immunity . . . reject the common law distinctions between proprietary and governmental activities." Id. at 263-264, 517 A.2d at 1021. Appellants present no arguments or precedent which persuade us to reconsider that decision.
Lastly, Appellants contend that Section 306 of the Municipality Authorities Act provides a means to seek redress against Appellee, McKeesport Water Authority. They argue that the following language in Section 306 provides a waiver of sovereign immunity: •
Any person questioning the reasonableness or uniformity of any rate fixed by the Authority or the adequacy, safety and reasonableness of the Authority's services, including extensions thereof, may bring suit against the Authority in the court of common pleas. . . . The court of common pleas shall have exclusive jurisdiction to determine all such questions including rates or service.
53 P.S. §306B.(h) (emphasis added).
The language on which Appellants rely was ádded to the Municipality Authorities Act October 7, 1955. It provided a waiver of the common law sovereign immu nity for the limited purposes enunciated therein. Subsequently, common law sovereign immunity for local agencies was abolished by our Supreme Court in Ayala v. Philadelphia Board of Public Education, 453 Pa. 584, 305 A.2d 877 (1973). In response, the legislature enacted the Tort Claims Act in 1978, which specifically states that: "Except as otherwise provided in this subchapter, no local agency shall be liable for any damages on account of any injury to a person or property caused by any act or any other person." 42 Pa. C. S. §8541. That a municipal water authority is a local agency under the Tort Claims Act is not contested by Appellants. See Section 1991 of the Statutory Construction Act of 1972, as amended, 1 Pa. C. S. §1991 (1986). Therefore, Section 306 of the Municipality Authorities Act is limited by the later enactment of the Tort Claims Act; if suit is barred by the Tort Claims Act, it may not be brought under a previously enacted statute. Since we have concluded that Appellants' claims are barred by the Tort Claims Act, they cannot be brought under Section 306 of the Municipality Authorities Act.
In light of the foregoing analysis, we affirm.
Order
And Now, February 19, 1987 the orders of the Court of Common Pleas of Allegheny County in the above-captioned matters, are affirmed.
Act of November 26, 1978, P.L. 1399, as amended, formerly 53 P.S. §5311.101-5311.803, repealed and substantially reenacted by the Act of October 5, 1980, P.L. 693, as amended, 42 Pa. C. S. §8541-64.
. Act of May 2, 1945, P.L. 382, as amended, 53 P.S. §306.
Appellants extensively cite Jolly v. Monaca Boro, 216 Pa. 345, 65 A. 809 (1907) and Curtioff v. Municipal Authority of Westmoreland County, 40 W.L. S. 203 (1958) to support their contention. However, these cases were decided prior to the enactment of the Political Subdivision Tort Claims Act.
Amendment of October 7, 1955, P.L. 671, No. 185, 1955 Pa. Laws 672.
Section 1991 contains the following relevant definitions: 'Local Authority.' When used in any statute finally enacted on or after January 1, 1975, a municipal authority or any other body corporate and politic created by one or more political subdivisions pursuant to statute.
'[Mjunicipal Authority.' A body corporate and politic created pursuant to the . . . Muncipality Authorities Act of 1945.
1 Pa. C. S. §1991 (emphasis added).