Opinion ID: 1967081
Heading Depth: 1
Heading Rank: 1

Heading: amount of bond as a limit on damages

Text: Appellants' first issue raises a point not directly passed upon by our courts since the adoption by our Supreme Court of the Rules of Civil Procedure in 1952. Appellants argue that they are not limited by the amount of the injunction bond in their claim for damages because Pa.R.C.P. 1531(b) authorizes recovery for all damages incurred. Plaintiffs counter that the rule should be construed so as to limit recovery to the amount of the bond. Therefore, we are called upon to resolve this conflict as to the proper construction of the language of Pa.R.C.P. 1531(b). Specifically, the rule states: (b) Except when the plaintiff is the Commonwealth of Pennsylvania, a political subdivision or a department, board, commission, instrumentality or officer of the Commonwealth or of a political subdivision, a preliminary or special injunction shall be granted only if (1) the plaintiff files a bond in an amount fixed with the security approved by the court, naming the Commonwealth as obligee, conditioned that if the injunction is dissolved because improperly granted or for failure to hold a hearing, the plaintiff shall pay to any person injured all damages sustained by reason of granting the injunction and all legally taxable costs and fees, or (2) the plaintiff deposits with the prothonotary legal tender of the United States in an amount fixed by the court to be held by the prothonotary upon the same condition as provided for the injunction bond. (Emphasis added). Our duty is to accord the language utilized by the Supreme Court its plain meaning. Pa.R.C.P. 127(b); Cf. Salvado v. Prudential Property and Cas. Ins. Co., 287 Pa.Super. 304, 430 A.2d 297 (1981). We construe the rule as a mandate that a petitioner file a bond, in the amount fixed by the court, prior to the court's issuance of the requested special relief. Soja v. Factoryville Sportsmen's Club, 361 Pa.Super. 473, 522 A.2d 1129 (1987); Christo v. Tuscany, Inc., supra (bond must be filed). The rule further states that the bond is subject to the condition that plaintiff shall pay from the bond all damages sustained by reason of the injunction upon dissolution of the injunction. Clearly, the rule provides that the bond shall be subject to disbursement to pay damages; however, the rule is somewhat less than clear regarding the question of whether other funds may also be subject to disbursement to pay all damages. To date, there have been no cases which have directly addressed this issue. However, the Commonwealth Court has passed on a substantially similar issue. In Juniata Foods, supra, the plaintiff, a governmental entity, sought and gained a preliminary injunction against defendant. The plaintiff posted no bond, as the Commonwealth is exempt from the need to post bond. Pa.R.C.P. 1531(b). When the injunction was dissolved as improperly granted, defendant sued the Commonwealth for damages. The issue was whether recovery was foreclosed as no bond had been posted. The Court held that a bond is not a condition precedent to obtaining damages from a governmental entity. Rather, [t]he bond requirement in Pa.R.C.P. 1531(b)(1) is merely to insure a ready source for payment of damages if due. Juniata Foods v. Mifflin County Development Authority, supra, 486 A.2d at 1037. Therefore, where no bond is set, an action for damages may still lie against the Commonwealth. This Court's task is to determine whether an action upon the bond would be the sole source of recovery from a non-governmental plaintiff. As we deem the plain meaning of the express language of the rule ambiguous on this point, further analysis as to the rule's meaning must be made in accordance with the rules of construction set forth in the Rules of Civil Procedure. Specifically: Rule 127. Construction of Rules. Intent of Supreme Court Controls (a) The object of all interpretation and construction of rules is to ascertain and effectuate the intention of the Supreme Court. (b) Every rule shall be construed, if possible, to give effect to all its provisions. When the words of a rule are clear and free from all ambiguity, the letter of it is not to be disregarded under the pretext of pursuing its spirit. (c) When the words of a rule are not explicit, the intention of the Supreme Court may be ascertained by considering, among other matters (1) the occasion and necessity for the rule; (2) the circumstances under which it was promulgated; (3) the mischief to be remedied; (4) the object to be attained; (5) the prior practice, if any, including other rules and Acts of Assembly upon the same or similar subjects; (6) the consequences of a particular interpretation; (7) the contemporaneous history of the rule; and (8) the practice followed under the rule. Pa.R.C.P. 127. (Emphasis added).
The statute which preceded Pa.R.C.P. 1531(b) was 12 P.S. § 2071: [3] § 2071. Indemnity bond before injunction may issue. No injunction shall be issued by any court or judge until the party applying for the same shall be given bond with sufficient sureties, to be approved by said court or judge, conditioned to indemnify the other party for all damages that may be sustained by reason of such injunction. 1844, May 6, P.L. 564, § 1. (Emphasis added). Prior practice, under this rule, was enunciated by the Supreme Court in Azar v. Markle, 311 Pa. 296, 166 A. 889 (1933). The Court, in a per curiam opinion, stated that a defendant's only remedy for damages from an injunction is against the bond. The very purpose of such bonds is to indemnify defendants for `all damages that may be sustained by reason of such injunction.' If the amount of the bond was inadequate, the attention of the chancellor should have been directed to that fact at the time it was filed. 311 Pa. at 298, 166 A. 889. (citation omitted). Accordingly, prior practice was to limit damages to the amount of the bond.