Court Opinion

ID: 4554868
Source: CourtListenerOpinion
Date Created: 2020-08-12 14:11:41.798633+00
Date Added: 2024-06-11T09:26:24.018843
License: Public Domain

IN THE COMMONWEALTH COURT OF PENNSYLVANIA

Ernest Bock & Sons, Inc.               :
                                       :
            v.                         :
                                       :
City of Philadelphia                   :
                                       :
            v.                         :   No. 349 C.D. 2018
                                       :
Liberty Mutual Insurance Company,      :
and Fidelity and Deposit Company       :
of Maryland                            :
                                       :
Appeal of: Ernest Bock & Sons, Inc.,   :
Liberty Mutual Insurance Company       :
and Fidelity and Deposit Company       :
of Maryland                            :
                                       :
                                       :
Ernest Bock & Sons, Inc.               :
                                       :
            v.                         :
                                       :
City of Philadelphia                   :
                                       :
            v.                         :   No. 350 C.D. 2018
                                       :   Argued: June 9, 2020
Liberty Mutual Insurance Company       :
and Fidelity and Deposit Company       :
of Maryland                            :
                                       :
Appeal of: City of Philadelphia        :

BEFORE: HONORABLE P. KEVIN BROBSON, Judge
        HONORABLE PATRICIA A. McCULLOUGH, Judge
        HONORABLE J. ANDREW CROMPTON, Judge

OPINION NOT REPORTED

MEMORANDUM OPINION
BY JUDGE BROBSON                       FILED: August 12, 2020
       In these consolidated cross-appeals, Appellants Ernest Bock & Sons, Inc.
(EBS), Liberty Mutual Insurance Company (Liberty), and Fidelity and Deposit
Company of Maryland (Fidelity) (Liberty and Fidelity, collectively, Sureties) and
Appellee City of Philadelphia (City)1 appeal from an order of the Court of Common
Pleas of Philadelphia County (trial court), dated February 9, 2018. The trial court
granted, in part, and denied, in part, the parties’ motions for post-trial relief. For the
reasons set forth herein, we affirm, in part, and reverse, in part, the trial court’s order.
                                     I. BACKGROUND
       The relevant facts, as found by the trial court and/or set forth in the testimony
and documentation presented by the parties at trial, and which the parties do not
appear to dispute,2 are as follows. The City’s construction and renovation project
for Terminal D-E of the Philadelphia International Airport was broken down
into 4 phases/packages:          Package 1A (Foundations and Structural Frame),
Package 1B (Building Fit-Out), Package 2 (Renovation and Expansion of Ticketing
Buildings), and Package 3 (Extension of E Concourse “Hammerhead”).
(R.R. at 1139a.) Package 1B, which was commonly referred to as the Terminal D-E
Expansion & Modernization, included the construction or “build out” of the empty
steel frame connector building (Connector Building) located between Terminal D

       1
         This Court had previously designated EBS and the Sureties as appellants and the City as
appellee pursuant to Pennsylvania Rule of Appellate Procedure 2136.
       2
           The only factual finding that the parties appear to dispute is Finding of Fact No. 113,
which was modified by the trial court’s February 9, 2018 order, and now provides: “For at least a
substantial portion of the parapet walls, EBS did not begin installing pressure treated plywood
until after June 12, 2008.” (Trial Ct.’s Order dated Feb. 9, 2018; Reproduced Record (R.R.)
at 1157a.) EBS and the Sureties argue that “this finding is contrary to the evidence that as of
June 12, 2008, EBS had been installing plywood for over two months.” (EBS’s and the Sureties’
Br. at 39.) Whether this finding is supported by substantial evidence of record is irrelevant to our
disposition of the issues presented in this appeal, and, therefore, we will not address the accuracy
of this finding in any further detail.

                                                 2
and Terminal E (Project) that had been previously constructed under Package 1A.
(Id.)    Once completed, the Connector Building would contain 4 floors.
(Id. at 1140a.)
        On December 5, 2006, EBS submitted a bid proposal to the City to serve as
the general contractor for the Project. (Id. at 1142a.) EBS, as the successful bidder,
entered into a construction contract (Contract) with the City, which incorporated,
inter alia, the Plans, Technical Specifications, and Standard Details and
Specifications for the Project (collectively, Project Specifications) and the City’s
Standard    Contract    Requirements     for   Public   Works     Contracts   (SCRs).
(Id. at 1142a-43a, 1717a-1803a.) Generally speaking, the SCRs set forth the parties’
rights, duties, and responsibilities under the Contract, including, but not limited to,
what constitutes a violation of the Contract by EBS and what remedies are available
to the City in the event of any such violation of the Contract by EBS.
(Id. at 1717a-1803a.) Paragraph 33 of the SCRs, which is entitled “Default and
Remedies,” provides, in relevant part:
                     (a) It shall be a violation of the Contract for [EBS]
              to abandon the work under the Contract; to fail or refuse
              to prosecute the work with promptness and diligence; to
              unreasonably delay the work so that it may not be
              completed within the contract time; to fail or refuse to
              proceed with work under a Disputed Change Order; to fail
              or refuse to furnish suitable materials in place of any
              which may be rejected by the Project Manager as
              unsuitable as not being in accordance with the Contract
              Documents, or to refuse or neglect to furnish and supply a
              sufficient number of properly skilled workers and
              necessary equipment or either of them; to execute any of
              the work improperly, carelessly, or in bad faith; to fail or
              refuse to remove any of the work which, in the opinion of
              the Project Manager, is defective and unsuitable and not in
              accordance with the Contract Documents, and to replace it
              with work that is in accordance with the Contract

                                           3
            Documents; to cause or to permit to occur an Event of
            Insolvency with respect to [EBS], or to otherwise violate
            any of the terms, conditions, and provisions of the
            Contract. In the event of a violation of the Contract, the
            [City] may notify [EBS] and [the Sureties] in writing to
            require that each remedy [EBS’s] violation of the Contract
            and require [EBS] to comply with the terms, conditions,
            and provisions of the Contract which it has violated or is
            violating. The failure of the City to promptly notify [EBS]
            of a violation of [the] Contract shall not constitute an
            acceptance by the City of work which is performed or
            installed in violation of the Contract.
                     (b) If [EBS] shall fail to cure or remedy, or
            diligently commence to cure or remedy, the violation of
            the Contract, as described in the notice specified above,
            . . . [the City] shall have the right to declare [EBS] in
            default of the Contract, and to notify [EBS] to discontinue
            the work or any part thereof under the Contract, and to call
            upon the [Sureties] to carry out [their] obligations under
            the performance bond posted for the Contract.
                      ....
                   (e) In case of such default by [EBS] the remedies
            herein provided shall be in addition to and not in
            substitution of the rights and remedies which would
            otherwise be vested in the City by statute, at law or in
            equity, all of which rights and remedies are specifically
            reserved to the City. . . . The failure of the City to exercise
            any of the remedies herein provided shall not preclude the
            resort by the City to any other remedy available to the City
            arising out of [EBS’s] default.
(Id. at 1777a-78a.)     Pursuant to Paragraph 61 of the SCRs, which is entitled
“Contractor’s Liability for Services and Materials,” EBS continues to be responsible
for its work on the Project regardless of the City’s review, approval, or acceptance
of or payment for EBS’s work. (Id. at 1790a.) More specifically, Paragraph 61 of
the SCRs provides, in relevant part:
                  (a) Notwithstanding the acceptance and approval by
            the City of any work[, EBS] shall continue to be
            responsible for the professional quality, technical
                                          4
              accuracy and the coordination of all work under the
              Contract. [EBS] shall, without additional compensation,
              correct any defects, deficiencies or omissions in the work.
                    (b) The City’s review, approval, or acceptance of,
              or payment for, any work performed under the [Contract]
              shall not constitute any representation, warranty or
              guaranty by the City as to the substance or quality of the
              work reviewed, approved, or accepted, and shall not be
              construed to operate as a waiver or estoppel of any of the
              City’s rights or privileges under the Contract, nor or [sic]
              of any cause of action arising out of the performance of
              the Contract.
(Id.)
        To guarantee its performance under the Contract, EBS obtained a
Performance Bond from the Sureties.3 (Id. at 1154a, 1721a-23a.) Pursuant to
Paragraph 3 of the Performance Bond, the Sureties’ obligations thereunder are
triggered only “after the City has declared a Contractor Default as defined [therein],
formally terminated the [Contract] or [EBS’s] right to complete the [Contract], and
notified the Suret[ies] of the City’s claim under the Performance Bond.”
(Id. at 1721a.) Paragraph 14(c) of the Performance Bond defines a “Contractor
Default” as “the failure or refusal of [EBS], after written notice from the City, to
cure or remedy, or commence to cure or remedy, a [v]iolation of the [Contract].”
(Id. at 1723a.) If and when the City satisfies all of the conditions set forth in
Paragraph 3 of the Performance Bond, Paragraph 4 of the Performance Bond
requires the Sureties to:
              (a) Arrange for [EBS] to perform and complete the
              [Contract] . . . ; or
              (b) Perform          and      complete       the     [Contract
              themselves] . . . ; or

        EBS also obtained a Payment Bond from the Sureties to guarantee the payment of EBS’s
        3

subcontractors for their work on the Project. (R.R. at 1724a-25a.)

                                             5
             (c) Tender payment to the City in the amount of all
             losses incurred by the City as a result of the Contractor
             Default and as determined by the City for which the
             Suret[ies are] liable to the City, including all costs of
             completion of the [Contract] and all consequential losses,
             costs, and expenses incurred by the City as a result of the
             Contractor Default, and including all unpaid fees or
             payments owed to the City by [EBS] under the [Contract.]
(Id. at 1721a.) Paragraph 5 of the Performance Bond requires the Sureties to act
under Paragraph 4 “within [15] business days after notice from the City to the
Suret[ies] of the Contractor Default, formal termination of the Contract[,] or [EBS’s]
right to complete the [Contract].” (Id.) In the event that the Sureties do not proceed
in accordance with Paragraphs 4 and 5 of the Performance Bond, Paragraph 6 of the
Performance Bond provides that the Sureties will be in default of the Performance
Bond and the City will be entitled “to enforce any legal or equitable remedy available
to [it].” (Id.) In addition, under Paragraph 7 of the Performance Bond:
             After the City has terminated the [Contract] or [EBS’s]
             right to complete the [Contract], and if the Suret[ies are]
             proceeding under subparagraphs 4(a) or 4(b) above, then
             the responsibilities of the Suret[ies] to the City shall not be
             greater than those of [EBS] under the [Contract], and the
             responsibilities of the City to the Suret[ies] shall not be
             greater than those of the City under the [Contract]. The
             Suret[ies] shall be obligated to the limit of [the] Bond
             Amount set forth on the front page, subject, however, to a
             commitment by the City for payment to the Suret[ies] of
             the Balance of the Contract Price in mitigation of costs and
             damages on the [Contract]. The Suret[ies] shall be
             obligated, without duplication, for:
                    ....
             (b) Additional legal, design professional, and delay
             costs incurred by the City as a result of the Contractor[]
             Default, and as a result of the Suret[ies’] actions or failures
             to act under Paragraph 4 above[.]
(Id. at 1722a.)

                                           6
       On July 2, 2007, the City provided EBS with notice to proceed with its
construction on the Project. (Id. at 18a-19a, 1155a.) Based on the City’s notice to
proceed, EBS had until December 3, 2008—or 520 calendar days from
July 2, 2007—to complete its work on the Project. (Id. at 1155a.) In order to ensure
that it could complete the Project within the 520 days, EBS intended to work on
all 4 floors of the Connector Building simultaneously. (Id. at 2657a.) Despite the
City’s issuance of its notice to proceed, however, EBS was not able to immediately
commence full construction activity on the Project, because the contractor that was
responsible for the foundation and structural frame of the Connector Building under
Package 1A had not yet completed its work, and EBS did not have access to all of
the floors of the Connector Building until approximately November 2007.
(Id. at 2572a, 2657a-58a.) By letter to the City dated August 30, 2007, EBS reserved
the right to seek a time extension under the Contract as a result of the City’s delay
in turning over the Project to EBS. (Id. at 2711a-12a.)
       All construction on the Project was subject to the 2003 International Building
Code (IBC). (Id. at 1140a.) Under the IBC, the Connector Building was classified
as construction Type 1B, which required the Connector Building to be constructed
with noncombustible materials and mostly 2-hour fire resistant assemblies.4 (Id.)
As a result, Section 06160 of the Project Specifications called for the utilization of
“USG FIBEROCK Brand Sheathing, Aqua Tough” (Aqua Tough sheathing), a
noncombustible material, in the construction of the exterior parapet walls of the
Connector Building. (Id. at 1156a, 7873a-76a.) In fact, Paragraph 63 of the SCRs

       4
          At some point after the Project was substantially complete, the City obtained permission
to classify the Connector Building as Type 2A construction under the IBC; this change did not,
however, alter the requirement that the Connector Building be constructed with noncombustible
materials. (R.R. at 1140a.)

                                                7
specifically required that “[t]he materials used in the work under the Contract . . .
conform to the requirements of the [Project Specifications].” (Id. at 1790a.) In the
event that EBS desired to change any of the Contract requirements, including the
requirement for the utilization of Aqua Tough sheathing in the construction of the
parapet walls, Paragraph 48(a) of the SCRs required EBS to obtain a “prior written
order[] from the Project Manager authorizing the change and a [c]hange [o]rder
fixing the additional compensation or deduction therefor.” (Id. at 1783a.) Despite
the Project Specifications’ requirement for the utilization of Aqua Tough sheathing,
EBS constructed the parapet walls of the Connector Building using pressure treated
plywood, which is combustible and is not fire rated. (Id. at 1157a.) EBS then
painted at least some of the plywood with intumescent paint, a paint that swells up
when heated but that is not a substitute for fire-retardant wood. (Id. at 1158a.)
       The City’s Project Manager5 was in charge of the work performed by EBS
under the Contract. (Id. at 1765a, 7730a.) Gilbane McKissack (Gilbane), the entity
retained by the City as the construction manager for the Project, represented the
Project Manager “for on-site construction administration and construction
management services” and served as the liaison between the City and EBS for all
communications and approvals in connection with the work performed by EBS on
the Project. (Id. at 1141a, 7730a, 7755a.) Daroff Designs, Inc. (Daroff) served as
the architect for the Project. (Id. at 1141a.) Throughout the course of EBS’s work
on the Project, EBS had construction progress meetings with representatives from
Gilbane and/or Daroff.        (Id. at 1157a-58a, 7892a-7927a.)          Minutes from the
July 22, 2008 progress meeting noted that “[s]heathing for the roof was supposed to

       5
         Tom Varughese served as the City’s Project Manager from the commencement of the
Project until September 2008, and Frederick Robinson served as the City’s Project Manager from
August 8, 2008, and thereafter. (R.R. at 1140a.)

                                              8
be Aqua Tough, however, pressure treated plywood was installed.                            [EBS] is
currently painting the wood with intumescent paint. [EBS] to provide supporting
documentation from Siplast[, the manufacturer of the roofing materials,] for this
action.”6    (Id. at 1157a-58a, 7892a.)          During subsequent progress meetings on
July 29, 2008, August 5, 2008, August 12, 2008, and August 19, 2008, EBS was
advised that “a submittal [was] required for the current plywood.” (Id. at 1158a,
7892a-94a.)       Thereafter, on August 20, 2008, EBS provided Gilbane with a
submittal, seeking approval of its construction of the parapet walls using pressure
treated plywood painted with intumescent paint. (Id. at 1158a.) Gilbane notified
EBS at the September 2, 2008 progress meeting that its submittal had been rejected.
(Id. at 1158a, 7894a.) At subsequent progress meetings on September 9, 2008,
September 16, 2008, September 23, 2008, and September 30, 2008, Gilbane advised
EBS that the design team’s “concerns [regarding the use of plywood in the
construction of the parapet walls] must be addressed or the plywood will need [to
be] replaced.” (Id. at 1158a, 7894a-95a.) On October 6, 2008, EBS prepared a
second submittal, again seeking approval of its construction of the parapet walls
utilizing plywood rather than Aqua Tough sheathing. (Id. at 1158a-59a.) EBS’s
second submittal was also rejected. (Id. at 1159a.)
       EBS did not substantially complete its work on the Project until
December 28, 2008. (Id. at 1155a.) The City paid EBS $38,391,737.15 for its work
on the Project and did not assess liquidated damages against EBS for its failure to
substantially complete its work on the Project by December 3, 2008. (Id.) The City
did, however, withhold retainage from EBS in the amount of $1,187,373.34 to cover

       6
         In a field activity report from March 5, 2008, a Siplast representative noted that, because
the fourth floor level roof “is a vertical flashing area, the exterior sheathing must be exterior grade
plywood.” (Id. at 1948a-49a.)

                                                  9
its damages in connection with EBS’s defective work on the Project. (Id. at 1185a.)
In order to remediate EBS’s defective work on the Project, including EBS’s use of
plywood in the construction of the parapet walls, the City retained the services of
Mason Building Group, Inc. (Mason). (Id. at 1160a, 1166a.) The amount paid by
the City to Mason for construction costs that is attributable to EBS’s defective work
on the Project was $3,357,282.21, which amount consists of $2,577,438.24 for the
cost of Mason’s base contract remedial work less a $26.50 clerical error,
$130,970.47 for the cost of additional work, testing, and contingency, and $648,900
for the cost of mobilization/demobilization. (Id. at 1168a.) The City also incurred
“soft costs” in connection with design and construction management services
relative to Mason’s remediation of EBS’s defective work on the Project in the
amount of $924,304.24. (Id.) In total, the City paid Mason $4,281,586.45 for
remediation work attributable to EBS’s defective work on the Project, $2,335,400.25
of which represented the cost to remove and replace the parapet walls.7
(Id. at 1168a-69a, 6177a.)
       On May 24, 2011, EBS filed a complaint against the City, alleging, inter alia,
that the City breached the Contract by failing and refusing to pay EBS for certain
amounts due and owing to EBS for work completed on the Project and for the
premium time and acceleration costs that EBS incurred in connection with the City’s
delay of EBS’s commencement of work on the Project. (Id. at 1a-78a.) Subsequent
thereto, on July 13, 2011, the City filed an answer to EBS’s complaint with new

       7
         In their joint statement of errors complained of on appeal (Joint Statement), EBS and the
Sureties asserted that only $2,335,400.25 of the $4,281,586.45 that the City paid to Mason in
connection with EBS’s defective work on the Project related to the cost of removing and replacing
the parapet walls. (R.R. at 6177a.) The trial court had no reason to dispute EBS’s assertion and
accepted it for the purposes of its Pennsylvania Rule of Appellate Procedure (Rule) 1925(a)
opinion. (Trial Ct. Op., May 8, 2018, at 15.)

                                               10
matter and a counterclaim, alleging that EBS breached the Contract by failing to
perform its work on the Project in accordance with the terms and conditions of the
Contract. (Id. at 79a-148a.)
      On November 9, 2011, during the pendency of this action before the trial
court, the City served notice on the Sureties of its demand for performance under the
Performance Bond. (Id. at 1155a, 2530a-31a.) The City’s November 9, 2011 letter
provided, in pertinent part:
             The City has performed its final inspection of the work[]
             and issued a final estimate pursuant to Paragraph 57 of [the
             SCRs]. The City has determined that [EBS] has failed,
             after reasonable notice and opportunity to cure, to
             complete the work of the Contract and to correct defective
             and unsuitable work. The City has determined that the
             total value of such incomplete and defective work is
             $2,345,106.62. Currently, the net amount due to the City
             is $1,157,733.28, which sum includes an offset for
             retainage.
             ....
             Pursuant to the terms of the [Performance] Bond,
             [P]aragraph 3, you are hereby notified that, at this time,
             the City has closed out the Contract, and [EBS] no longer
             has the right to complete the Contract. As required by the
             terms of the [Performance] Bond, [P]aragraph 5, please
             contact [the City] within [15] days to advise how the
             Suret[ies] wish[] to proceed.
(Id. at 2530a-31a.) By letter dated August 28, 2012, the Sureties denied the City’s
claim under the Performance Bond. (Id. at 1156a, 2534a-44a.) Thereafter, on
September 28, 2012, the City sought leave from the trial court to join the Sureties to
this action as additional defendants. The trial court granted the City’s request, and,
on November 20, 2012, the City filed a joinder complaint against the Sureties,
alleging that the Sureties breached their obligations to the City under the terms and
conditions of the Performance Bond. (Id. at 198a-245a.)

                                         11
      On September 25, 2017, following a lengthy non-jury trial that spanned
several weeks over the course of several months and the parties’ submission of
proposed findings of fact and conclusions of law, the trial court issued extensive
findings of fact and conclusions of law.          (Id. at 1139a-1283a.)    Concurrently
therewith, the trial court issued a verdict in favor of the City and against EBS and
the Sureties in the amount of $2,762,312.27—i.e., the City’s net damages of
$3,601,535.74 less EBS’s net damages of $839,223.47. (Id. at 1283a.) In reaching
its verdict, the trial court concluded, in relevant part, that: (1) EBS violated the
Contract by installing combustible pressure treated plywood on the parapet walls,
by failing to provide the City with a submittal prior to installing pressure treated
plywood on the parapet walls, and by failing and refusing to remove and replace the
pressure treated plywood on the parapet walls despite a demand to do so; (2) the
Sureties breached the Performance Bond by failing to tender payment to the City for
the losses incurred by the City as a result of EBS’s violation of the Contract; (3) as
a direct and proximate result of EBS’s violation of the Contract, the City was
required to pay Mason to perform remedial work on the Project; (4) EBS was
contractually barred from asserting a delay/acceleration claim against the City;
and (5) the City was not entitled to an award of attorneys’ fees under the
Performance Bond. (Id. at 1155a, 1160a, 1169a, 1189a, 1282a-83a.)
      EBS and the Sureties filed a motion for post-trial relief, as did the City.
(Id. at 1286a-1370a, 1371a-84a.) Thereafter, on February 9, 2018, the trial court
granted, in part, and denied, in part, EBS’s and the Sureties’ motion for post-trial
relief and granted, in part, and denied, in part, the City’s motion for post-trial relief.
(Id. at 1664a-66a.) In so doing, the trial court, inter alia: (1) vacated its findings of
fact and conclusions of law relative to its denial of EBS’s delay and acceleration

                                           12
claim and modified its decision to include an award of damages to EBS in the amount
of $505,938 in connection with EBS’s delay and acceleration claim; and
(2) modified its decision to award the City post-judgment interest on its modified
verdict of $2,194,960.27—i.e., the amount of the original verdict reduced by,
inter alia, the amount of EBS’s damages in connection with its delay and
acceleration claim. (Id. at 1665a-66a.)
      The parties cross-appealed the trial court’s order to this Court, and the trial
court directed the parties to file statements of errors complained of on appeal
pursuant to Rule 1925(b). In its Rule 1925(a) opinion, the trial court reasoned:
             EBS first complains “the [trial c]ourt erred in its valuation
             of damages for breach of contract regarding the parapets,
             entitling EBS to a new trial on the City’s damages.” For
             the reasons that follow, this [trial c]ourt does not agree.
                    First, as a preliminary matter, EBS and the Sureties
             waived their issue regarding the measure of damages by
             asserting it for the first time in their post-trial motion. . . .
                   . . . EBS and the Sureties never objected to the
             measure of damages presented by the City at trial.
             Therefore, EBS and the Sureties waived their claim that
             the cost of repair was “clearly disproportionate” and the
             burden was on “the City to introduce evidence as to
             diminution in value in order for the [trial c]ourt to make a
             determination as to the appropriate measure of damages.”
                   Second, even if EBS had not waived the issue, it has
             no merit. As the City has argued, “[c]ontract damages are
             intended to give the parties the benefit of the bargain.”. . .
                    EBS[’] and the Sureties[’] reliance on cases such as
             Freeman v. Maple Point, Inc., 574 A.2d 684
             ([Pa. Super.] 1990), is misplaced. “There, the Superior
             Court set aside an award based on the cost of correcting a
             water problem because such cost ($45,785.00)
             represented 48% of the cost of the house. It was because
             the award was grossly disproportionate on its face that the
             [Superior] Court required some evidence of the diminution

                                            13
in value of the property as a result of the surface water
problem.”
       The facts in the instant case are different than the
facts in Freeman. An award of $2,335,400.25 to remove
and replace the parapets was not patently disproportionate
to the nearly $40 million the City paid EBS for its work on
the [Project]. The City “did not receive a windfall by an
award of the cost of repairing the defective [parapets].”
“Therefore, it was not essential that the [City], in order to
recover the costs of making repairs, prove by separate
evidence that the repair costs were not grossly
disproportionate to the diminution in value caused by the
defective [parapets].” If EBS and the Sureties “deemed
the cost of making repairs disproportionate to the
diminution in the value of the [Connector Building], the
burden was on them to introduce evidence establishing
that fact[,] [which] they did not do.”
       Under such circumstances, EBS and the Sureties
cannot now complain [that] “[t]he cost of removing and
replacing the parapets was clearly disproportionate to the
difference in the market value of the [Connector B]uilding
with the installed parapets versus the market value of the
[Connector B]uilding if the parapets were installed in
accordance with the [C]ontract.” As the City has argued,
since there is no evidence of the value of the Connector
Building:
      the relief sought by EBS under this issue, a new
      trial, would require, at a minimum, discovery being
      re-opened to permit the retention of . . . valuation
      experts, property investigations and evaluations[,]
      and gathering the requisite information for the
      preparation of an appraisal or other reports. In other
      words, a new trial would require this case to be
      re-litigated. The law simply will not allow EBS to
      do so after it failed to meet its own burden of
      rebuttal at trial.
       EBS[’s] and the Sureties[’] next [2] complaints both
relate to Paragraph 33 of the [SCRs]. In regard to
Paragraph 33, these parties complain [that] the [trial c]ourt
erred when it failed to consider the evidence that the City:
(1) “waived its rights when it permitted plywood to be

                             14
installed in the parapets” and (2) “did not provide EBS
with notice and an opportunity to cure the installation of
the plywood in the parapets.”
       Specifically, in this regard, EBS and the Sureties
argue there was waiver because “[t]he City, its [a]rchitect,
and its [c]onstruction [m]anager were aware that EBS was
installing plywood in the parapets, but failed to issue any
notice to EBS in accordance with Paragraph 33 of the
[SCRs] and stop the work and declare a default.” EBS and
the Sureties further argue that by not issuing notice, etc.[,]
to EBS pursuant to Paragraph 33 of the SCRs, “the City
failed to satisfy . . . contractual conditions precedent
before demanding that EBS correct the parapet work under
the [C]ontract and the [P]erformance [B]ond.”
       The Court did not fail to consider this
argument/evidence—it just does not have any merit or
dictate a different result. . . .
       By its plain terms, Paragraph 33(a) [of the SCRs]
states that “[i]n the event of a violation of Contract, the
[City] may notify [EBS] and [the Sureties] in writing to
require that each remedy [EBS’s] violation of the Contract
and require [EBS] to comply with the terms, conditions,
and provisions of the Contract which it has violated or is
violating.” This “may” language is permissive, not
mandatory. Accordingly, notice was not a condition
precedent to the City’s recovery and any failure to issue
notice to EBS in accordance with Paragraph 33 of the
[SCRs] did not result in a waiver of the City’s right to have
the parapets constructed pursuant to the terms of the
Contract or [to] recover damages for EBS’s failure to do
so.
      The City’s complaints of error relate to: (a) denying
the City’s claim for attorneys’ fees pursuant to the
Performance Bond and (b) awarding EBS $505,938 for its
delay and acceleration claim. Neither area of complaint
has merit nor warrants relief.
      ....
       The City has argued that the Sureties are liable for
all losses incurred by the City as a result of EBS’s default,
including attorneys’ fees, because they did not exercise

                             15
their options under Paragraph 4 of the Performance Bond.
Paragraph 7 of the Performance Bond states that when the
Sureties have elected to complete performance of the
Contract under Paragraph 4(a) or 4(b), the Sureties’
obligations under the Performance Bond include
“[a]dditional legal, design professional, and delay costs
. . . .” Paragraph 6 of the Performance Bond, however,
provides that when the Sureties have denied liability for a
claim, the City is entitled to enforce any “legal or equitable
remedies.”
      ....
       Based upon the plain language of the Performance
Bond, prepared by the City, Paragraph 7(b) only applies
“if     the    Suret[ies      are]     proceeding     under
subparagraphs 4(a) or 4(b).” Here, however, the Sureties
did not proceed under either subparagraph 4(a) or 4(b) of
the Performance Bond; rather, the Sureties denied liability
to the City. Therefore, it is clear the provisions set forth
in Paragraph 7 of the Performance Bond are inapplicable,
and the City is not entitled to attorneys’ fees under the
plain language of the Performance Bond. Moreover, even
if there was ambiguity in this regard, which there is not,
Pennsylvania law requires that the ambiguity be construed
against the City as the drafter and, therefore, the American
Rule holds true and the City cannot recover attorneys’ fees
from the Sureties in this case.
      Regarding EBS’s claim for delay and acceleration,
the City primarily complains [that] “[t]he [trial c]ourt
erred by reversing its initial findings in favor of the City
and awarding [EBS] . . . $505,938 for its acceleration and
delay claim . . . because its initial findings were factually
and legally correct.” However, for the reasons that follow,
there was no error in this [trial c]ourt reversing its initial
decision     and     awarding        EBS      $505,938      in
delay/acceleration damages as the City suggests.
       There is no dispute that EBS failed to formally
“perform . . . contractual requirements . . . [for]
sustain[ing] its delay/acceleration claim.” The [trial
c]ourt, however, accepted EBS’s reliance on cases such as
James [Corporation] v. North Allegheny School District[,
938 A.2d 474 (Pa. Cmwlth. 2007),] to support the

                             16
proposition that where the government clearly knew the
operative facts giving rise to construction delays and the
contractor’s claim for acceleration of the work, the notice
provisions of the contract can be satisfied informally.
Therefore, upon further reflection, this [trial c]ourt
reversed its initial determination and awarded EBS
damages for delay/acceleration because: (1) there was an
undisputed and significant delay in turning over the
[Project]; (2) the completion date remained the same and
extension requests were not granted when subsequent
issues arose because the City had a predetermined date by
which it needed the Connector Building [to be] finished;
and (3) [Louis] Harris[, EBS’s former vice president and
project manager,] credibly testified on a number of points
regarding this claim, including that the $505,938 was
spent on additional supervisory personnel brought in to
accelerate EBS’s work.
       In James [Corporation], a contractor entered into a
contract with a school district to renovate an elementary
school building. The project incurred a number of delays
attributable to the school district, but the school district did
not grant any extensions of time. [James Corporation,]
938 A.2d at 480-81. In spite of those facts, the project was
completed on time and the contractor subsequently
brought suit against the school district, alleging . . . “[it]
accelerated its work because [the] [s]chool [d]istrict
refused to recognize the construction delays and adjust the
[p]roject completion date accordingly.” Id. at 481. The
contractor further alleged that “[i]n order to meet the
[p]roject deadline, . . . [it] accelerated its work and hired
additional workers[,]” resulting in additional costs. Id.
        The trial court awarded the contractor $215,000 in
damages for acceleration/compression of the work.
Id. at 482. On appeal, the Commonwealth Court affirmed
in spite of arguments from the school district that the lower
court erred in awarding such damages because there was a
“no damages for delay” clause in the parties’ contract and
the “[c]ontractor failed to timely provide notice of its
damages claim pursuant to the contract.” Id. at 483-85.
       As in James [Corporation], the “no damages for
delay” provision in this case was unenforceable. The City
interfered with EBS’s work by issuing the [n]otice to
                              17
[p]roceed for the [Project] even though the contractor for
the earlier [Package] 1A phase of the construction and
renovation had not completed its work[] and did not so
fully until [90] days later. James Corp., 938 A.2d at 484
(stating that “affirmative or positive interference sufficient
to overcome [a] ‘no damages for delay’ clause may
involve availability, access or design problems that
pre-existed the bidding process and were known by the
owner but not by the contractor[,]” and finding the school
district interfered with contractor’s work by issuing a
notice to proceed without having obtained a requisite
permit).
      Moreover, as in James [Corporation], the notice
provisions in this case were satisfied, albeit informally.
The City “clearly knew the operative facts giving rise to
the construction delays and [EBS’s] claims for accelerated
work.” James Corp., 938 A.2d at 486 (finding the notice
provision satisfied whether the school district was
responsible for the delays due to its failure to obtain a
requisite permit prior to issuing the notice to proceed, but
refused to adjust the project completion date because of its
overriding concern that not a single school day be missed).
       Finally, regarding EBS’s claim for delay and
acceleration, the City complains “[t]he Court erred in
sustaining EBS’s objection to the City’s introduction of
City-38, EBS’s Job Cost Summary, because City-38
proved that EBS did not incur excess costs to perform the
work.” According to the City, this exhibit shows “EBS
spent approximately $8 million less than planned to
perform the work . . . [and] the acceleration claim resulted
in a windfall for EBS.”
      ....
       The Contract in this case was a lump sum contract.
Whether EBS spent approximately $8 million less than
planned to perform the work, or earned a profit of at least
$8 million, is irrelevant to EBS’s delay/acceleration claim
and the propriety of this Court awarding EBS $505,938 for
additional supervisory costs. This is so because the
additional cost for supervision was incurred as a result of
the delay/acceleration attributable to the City and not
contemplated in EBS’s bid. What was relevant was the

                             18
             credible testimony of Mr. Harris that [5] supervisors had
             to be brought in after the City caused delays and
             accelerated EBS’s work.
                    City-38 was not a stand-alone document and by
             itself proved nothing. During the course of discussion
             regarding this document, it became clear the City wanted
             to use the exhibit to show EBS cut corners and saved
             money; therefore, the City owed EBS nothing for
             delay/acceleration [on] the Project in general. However,
             EBS[’s] and the Sureties’ counsel was correct when he
             stated: “This project is not a cost-plus project; it’s a lump
             sum project. Whether [EBS] had a million dollars in costs
             or a dollar in costs is really irrelevant.”
                   As a lump sum project, what was relevant was that
             the cost of additional supervision was not knowable at the
             time of the bid or figured into the bid. What was also
             relevant was that, per the credible testimony of
             Mr. Harris[,] the cost of additional supervision was
             incurred as a result of the delay in turning over the
             [Project] and the failure to grant extension requests when
             subsequent issues arose because of the pressure the City
             was under to complete the [Project] on time.
                    The City knew, or should have known, [of] EBS’s
             complaints regarding the late start of the [Project], etc.[,]
             and refusal to grant any time extensions triggered the
             City’s responsibility to remedy the situation. EBS was
             entitled to be awarded the cost for additional supervision
             and there was no error in doing so as the City suggests.
(Trial Ct. Op., May 8, 2018, at 15-26 (citations omitted) (heading omitted).)
     Before we could review the trial court’s decision and order on appeal, we
required further clarification regarding an issue raised by EBS and the Sureties in
their Joint Statement and brief to this Court. As a result, by memorandum and order
dated March 22, 2019, this Court remitted the record to the trial court with
instructions to file a supplemental Rule 1925(a) opinion, specifically addressing the
issue raised by EBS and the Sureties in Paragraph 10 of their Joint Statement—i.e.,
whether    the    City    complied     with    the    terms    and    conditions   of

                                          19
Paragraphs 3 through 5 of the Performance Bond—such that the trial court’s
judgment in favor of the City and against the Sureties should be affirmed. On
September 24, 2019, the trial court8 issued a supplemental Rule 1925(a) opinion,
concluding that the City complied with the terms and conditions of the Performance
Bond, because, “by letter dated November 9, 2011, . . . [the City] 1) declared EBS
in default due, inter alia, to its installation of the plywood instead of Aqua Tough
[sheathing], 2) formally terminated EBS’[s] right to complete the Contract,
and 3) notified the Sureties of the City’s claim under the [Performance] Bond.”
(Trial Ct. Suppl. Op., Sept. 24, 2019, at 4.)
                             II. ARGUMENTS ON APPEAL
       On appeal,9 EBS and the Sureties argue that the trial court committed an error
of law by: (1) failing to conclude that the City waived its right to object to EBS’s
construction of the parapet walls using plywood rather than Aqua Tough
sheathing; (2) failing to conclude that the City neglected to satisfy the provisions of
the Contract and/or the Performance Bond requiring the City to provide EBS with
notice and an opportunity to cure before the City could demand that EBS correct the
defects in the construction of the parapet walls or assert a claim under the
Performance Bond; and (3) awarding the City damages for the cost to remove and

       8
           The Honorable Patricia A. McInerney (Judge McInerney) presided over the lengthy bench
trial, issued detailed findings of fact and conclusions of law, and issued the trial court’s 1925(a)
opinion in this matter. At some point between her issuance of the trial court’s 1925(a) opinion and
this Court’s March 22, 2019 memorandum and order, Judge McInerney retired. Due to Judge
McInerney’s retirement, the trial court’s supplemental 1925(a) opinion was issued by the
Honorable Nina Wright Padilla.
       9
         This Court’s standard of review with regard to a trial court’s grant or denial of a motion
for post-trial relief is limited to determining whether the trial court abused its discretion or
committed an error of law. City of Phila. v. Benedetto, 801 A.2d 1276, 1278 n.5
(Pa. Cmwlth. 2002).

                                                20
replace the parapet walls in connection with EBS’s breach of the Contract. In its
cross-appeal, the City argues that the trial court committed an error of law
by: (1) reversing its initial findings in favor of the City and awarding EBS damages
for its delay and acceleration claim; and (2) concluding that the City was not entitled
to an award of attorneys’ fees under the Performance Bond.
                                 III. DISCUSSION
                              A. Waiver by the City
      EBS and the Sureties argue that the trial court committed an error of law by
failing to conclude that the City waived its right to object to EBS’s construction of
the parapet walls using plywood rather than Aqua Tough sheathing, because the City
observed the construction of the parapet walls for several months and never objected
by issuing a notice to stop work or by declaring a default as required by the Contract.
More specifically, EBS and the Sureties contend that: (1) Siplast directed EBS to
construct the parapet walls using plywood instead of Aqua Tough sheathing, and
EBS was obligated to follow Siplast’s instructions; (2) the City, through Gilbane and
Daroff, was aware of Siplast’s instructions, observed EBS’s construction of the
parapet walls using plywood, and did nothing to stop EBS from constructing the
parapet walls using plywood; (3) Daroff did not question EBS’s use of plywood until
the construction of the parapet walls had been ongoing for nearly 3 months and was
nearly complete; and (4) the City paid EBS in full for the construction of the parapet
walls. EBS and the Sureties further contend that the City’s failure to object to EBS’s
use of plywood in the construction of the parapet walls “led EBS to believe that the
City consented to EBS’[s] use of plywood.” (EBS’s and the Sureties’ Br. at 38.)
      In response, the City argues that the trial court properly concluded that the
City did not waive its right to recover damages in connection with EBS’s
construction of the parapet walls using plywood rather than Aqua Tough sheathing.
                                          21
More specifically, the City contends that the Contract clearly provided that the City
was under no obligation to object to EBS’s use of plywood in the construction of the
parapet walls. The City further contends that, even if it was under an obligation to
object, it “repeatedly told EBS that the installation of plywood was not allowed and
would have to be replaced if no permission to substitute was obtained,” and, while
EBS requested permission to substitute, the City rejected EBS’s requests.
(City’s Br. at 32.)
       Parties to a contract can expressly or impliedly waive its provisions. Black
Top Paving Co., Inc. v. Dep’t of Transp., 466 A.2d 774, 776 (Pa. Cmwlth. 1983).
“Waiver is a voluntary and intentional abandonment or relinquishment of a known
right.” Samuel J. Marranca Gen. Contracting Co., Inc. v. Amerimar Cherry Hill
Assocs. Ltd. P’ship, 610 A.2d 499, 501 (Pa. Super. 1992).10 “Waiver may be
established by a party’s express declaration[—i.e., an express waiver—]or by a
party’s undisputed acts or language so inconsistent with a purpose to stand on the
contract provisions as to leave no opportunity for a reasonable inference to the
contrary”—i.e., an implied waiver. Id. “An implied waiver exists when there is
either an unexpressed intention to waive, which may be clearly inferred from the
circumstances, or no such intention in fact to waive, but conduct which misleads one
of the parties into a reasonable belief that a provision of the contract has been
waived.”     Den-Tal-Ez, Inc. v. Siemens Capital Corp., 566 A.2d 1214, 1223
(Pa. Super. 1989).
       Here, EBS and the Sureties appear to contend that the City impliedly waived
its right to object to EBS’s failure to use Aqua Tough sheathing in the construction

       10
        While we recognize that Pennsylvania Superior Court cases are not binding on this Court,
such cases “offer persuasive precedent where they address analogous issues.” Lerch v.
Unemployment Comp. Bd. of Review, 180 A.3d 545, 550 (Pa. Cmwlth. 2018).

                                              22
of the parapet walls, because the City observed and did not object to EBS’s
construction of the parapet walls using plywood. We disagree. The City’s conduct
was not inconsistent and did not suggest that the City would not require EBS to
comply with the Contract’s requirement to use Aqua Tough sheathing in the
construction of the parapet walls. Quite to the contrary, representatives from
Gilbane and/or Daroff, the City’s construction manager and architect for the Project,
informed EBS at numerous construction progress meetings that the Contract
required EBS to construct the parapet walls using Aqua Tough sheathing and that
EBS would need to replace the plywood if EBS did not obtain approval from the
City to substitute the Aqua Tough sheathing with plywood. At some point after EBS
had already constructed at least a portion of the parapet walls using plywood, EBS
sought approval from the City to substitute the Aqua Tough sheathing with plywood,
but the City denied EBS’s requests. In other words, the City, consistent with the
terms and conditions of the Contract requiring the use of Aqua Tough sheathing in
the construction of the parapet walls, informed EBS that its use of plywood was not
in accordance with the requirements of the Contract and would not be accepted by
the City.
      Additionally, the Contract specifically provides that the City’s failure to
object to EBS’s construction of the parapet walls using plywood rather than Aqua
Tough sheathing does not amount to a waiver of the City’s ability to file an action
against EBS for a violation of the Contract. Under Paragraph 33(a) of the SCRs,
“[t]he [City’s] failure . . . to promptly notify [EBS] of a violation of [the] Contract
[does] not constitute an acceptance by the City of work which is performed or
installed in violation of the Contract.”       (R.R. at 1777a.)     Moreover, under
Paragraph 61(a) of the SCRs, even if the City accepts and approves EBS’s work on

                                          23
the Project, EBS “continue[s] to be responsible for the professional quality, technical
accuracy[,] and the coordination of all work under the Contract . . . [and] shall,
without additional compensation, correct any defects, deficiencies or omissions in
the work.” (Id. at 1790a.) Similarly, under Paragraph 61(b) of the SCRs,
             [t]he City’s review, approval, or acceptance of, or payment
             for, any work performed under the [Contract] shall not
             constitute any representation, warranty or guaranty by the
             City as to the substance or quality of the work reviewed,
             approved, or accepted, and shall not be construed to
             operate as a waiver or estoppel of any of the City’s rights
             or privileges under the Contract, nor or [sic] of any cause
             of action arising out of the performance of the Contract.
(Id.) Thus, even if, as EBS and the Sureties suggest, the City failed to object to
EBS’s use of plywood rather than Aqua Tough sheathing in the construction of the
parapet walls, given the terms and conditions of the Contract, it was not reasonable
for EBS to believe that the City had waived the Contract’s requirement for the use
of Aqua Tough sheathing in the construction of the parapet walls. For all of these
reasons, we cannot conclude that the trial court committed an error of law by failing
to determine that the City waived its right to object to EBS’s construction of the
parapet walls using plywood rather than Aqua Tough sheathing.
                      B. Notice and an Opportunity to Cure
                               1. Under the Contract
      EBS and the Sureties argue that the trial court committed an error of law by
failing to conclude that the City neglected to satisfy the provisions of the Contract
requiring the City to provide EBS with notice and an opportunity to cure before the
City could demand that EBS correct the defects in the construction of the parapet
walls. EBS and the Sureties contend that, in doing so, the trial court failed to
consider Paragraph 33(a)-(b) of the SCRs, which makes it mandatory that the City
provide EBS with notice and an opportunity to cure before the City could declare a
                                          24
default or a violation of the Contract. EBS and the Sureties further contend that the
City did not present any evidence to establish that the City provided EBS with notice
of a violation of the Contract or an opportunity to cure any such violation or that the
City had declared EBS to be in default of the Contract and had notified EBS to
discontinue its work on the Project; rather, “the City’s witnesses admitted that no
such procedure was followed.” (EBS’s and the Sureties’ Br. at 41.)
      In response, the City argues that the trial court properly rejected EBS’s
argument that the City failed to provide EBS with notice and an opportunity to cure
the defective construction of the parapet walls. In that regard, the City contends that
the notice provision set forth in Paragraph 33(a) of the SCRs—and the use of the
word “may”—is permissive, not mandatory, and, therefore, the City was not
required to provide EBS with notice and an opportunity to cure the defects in the
construction of the parapet walls before the City could declare a default of the
Contract. The City further contends that, even if it was required to provide EBS with
notice and an opportunity to cure, it repeatedly notified EBS of the issue with using
plywood in the construction of the parapet walls, and, “despite [its] warnings, EBS
proceeded at its own risk and moved forward with the plywood installation without
approval.” (City’s Br. at 34.) The City also contends that it is “completely
disingenuous for EBS to now assert that it would have corrected the problems with
the parapet walls had [EBS] only received notice of the defects, considering the fact
that EBS has had literally years to correct these issues yet has failed to do so.”
(City’s Br. at 34-35.)
      In their reply brief, EBS and the Sureties argue that interpreting the use of the
word “may” in Paragraph 33(a) of the SCRs as permissive “is contrary to the plain
language of the [Contract] and is contrary to Pennsylvania law with respect to

                                          25
contract interpretation, which requires that contracts be interpreted to give effect to
all provisions.” (EBS’s and the Sureties’ Reply Br. at 26.) EBS and the Sureties
contend that, if notice under Paragraph 33(a) was optional, the mandatory language
set forth in Paragraph 33(b)—i.e., the use of the word “shall” in the context of the
right to declare EBS in default—“would be wholly unnecessary [because] the City
could declare a default and call upon the Sureties to complete the work on the Project
absent a notice and [an] opportunity to cure.” (EBS’s and the Sureties’ Reply
Br. at 27.) EBS and the Sureties further contend:
                    The more reasonable and logical interpretation of
             the word “may” in the context of Paragraph 33[(a)] is that
             the City has discretion in the event of a violation of the
             Contract whether or not to issue a notice of violation[, and
             i]f the City does not issue a notice of violation, then it is
             not permitted to declare [EBS] in default and call upon the
             [Sureties] to remedy the violation.
(EBS’s and the Sureties’ Reply Br. at 27-28.)
      “Parties have the right to make their own contract, and it is not the function of
[this] [C]ourt to rewrite [the contract] or [to] give it a construction in conflict with
the plain meaning of the language used.” Dep’t of Transp. v. Acchioni & Canuso,
Inc., 324 A.2d 828, 830 (Pa. Cmwlth. 1974). Rather, this Court’s “goal is to
ascertain the intent of the parties and give it effect.” TruServ Corp. v. Morgan’s
Tool & Supply Co., Inc., 39 A.3d 253, 260 (Pa. 2012). “When the words of a contract
are clear and unambiguous, the intent of the parties must be ascertained from the
language employed in the contract, which shall be given its commonly accepted and
plain meaning.” Id. “[W]e must review and consider the entire instrument giving
effect to all its provisions and construing it according to the plain meaning of its
language.”      Adams v. Pub. Util. Comm’n, 819 A.2d 631, 634 n.7
(Pa. Cmwlth. 2003).

                                          26
      Here, Paragraph 33(a) of the SCRs clearly and unambiguously provides that
the City “may” but is not required to provide EBS with notice and an opportunity to
cure a violation of the Contract. Paragraph 33(a) provides, in relevant part:
             In the event of a violation of the Contract, the [City] may
             notify [EBS] and [the Sureties] in writing to require that
             each remedy [EBS’s] violation of the Contract and require
             [EBS] to comply with the terms, conditions, and
             provisions of the Contract which it has violated or is
             violating.
(R.R. at 1777a (emphasis added).) The only reasonable and logical interpretation of
the language of Paragraph 33(a) and the parties’ use of the permissive word “may”
is that the City was permitted but was not required to provide EBS with notice and
an opportunity to cure before it could recover damages from EBS for a violation of
the Contract.    In addition, contrary to EBS’s and the Sureties’ contentions,
Paragraph 33(b) is not useless if notice under Paragraph 33(a) is optional.
Paragraph 33(b) provides, in relevant part:
             If [EBS] shall fail to cure or remedy, or diligently
             commence to cure or remedy, the violation of the Contract,
             as described in the notice specified above, . . . [the City]
             shall have the right to declare [EBS] in default of the
             Contract, and to notify [EBS] to discontinue the work or
             any part thereof under the Contract, and to call upon the
             [Sureties] to carry out [their] obligations under the
             performance bond posted for the Contract.
(Id. at 1777a-78a.) Construing this language in accordance with its plain meaning,
as we are required to do, Paragraph 33(b) would apply in the event that the City
provided EBS with notice and an opportunity to cure under Paragraph 33(a) and the
City thereafter desired to declare a default or issue a stop work notice to EBS. In
other words, Paragraph 33(a)-(b) requires the City to provide EBS with notice and
an opportunity to cure only before it can declare EBS to be in default of the Contract
and issue a notice to EBS to discontinue its work on the Project. Paragraph 33(a)-(b)
                                         27
does not require the City to provide EBS with notice and an opportunity to cure if
the City decides to have EBS complete its work on the Project and to thereafter file
an action against EBS to recover damages in connection with EBS’s violation of the
Contract. This interpretation of Paragraph 33 is the only interpretation that gives
effect to all of its provisions. For these reasons, we cannot conclude that the trial
court committed an error of law by failing to conclude that the City neglected to
satisfy the provisions of the Contract requiring the City to provide EBS with notice
and an opportunity to cure before the City could demand that EBS correct the defects
in the construction of the parapet walls.
                          2. Under the Performance Bond
      EBS and the Sureties argue that the trial court committed an error of law by
failing to conclude that the City neglected to satisfy the provisions of the
Performance Bond requiring the City to provide EBS with notice and an opportunity
to cure before the City could assert a claim under the Performance Bond. EBS and
the Sureties contend that, in order to trigger the Sureties’ obligations under the
Performance Bond, the City was required to: (1) declare a Contractor Default under
the Performance Bond; (2) terminate the Contract or EBS’s right to complete the
Contract; and (3) notify the Sureties of the City’s claim under the Performance Bond.
EBS and the Sureties contend further that the informal notice provided by the City
at the weekly construction progress meetings regarding EBS’s use of plywood rather
than Aqua Tough sheathing in the construction of the parapet walls was insufficient
to satisfy the City’s obligation under the Performance Bond to provide EBS with
written notice of a violation of the Contract and an opportunity to cure any such
violation. EBS and the Sureties also contend that, given the City’s failure to provide
EBS with written notice of a violation of the Contract and an opportunity to cure any

                                            28
such violation, the City was not entitled to declare a Contractor Default under the
Performance Bond, and, therefore, the City’s November 9, 2011 letter, which was
sent almost 3 years after the City deemed the Project to be substantially complete,
could not possibly serve as a declaration of a Contractor Default under the
Performance Bond.
        In response, the City argues that the trial court correctly concluded that the
City properly invoked its rights under the Performance Bond because: (1) the City
complied with Paragraph 33(a) of the SCRs by providing EBS with sufficient notice
and an opportunity to cure its violation of the Contract—i.e., its failure to utilize
Aqua Tough sheathing in the construction of the parapet walls; and (2) the City’s
November 9, 2011 letter to the Sureties fulfilled the City’s requirements under the
Performance Bond—i.e., it notified the Sureties of EBS’s Contractor Default, it
formally terminated EBS’s right to complete the Contract, and it notified the Sureties
of the City’s claim under the Performance Bond.11
        In their reply brief, EBS and the Sureties argue that, in order to declare a
Contractor Default under the Performance Bond, Paragraph 33(a) of the SCRs

        11
           The City also argues that EBS and the Sureties waived the issue of the City’s compliance
with the Performance Bond because they did not raise the issue prior to or during trial. We
disagree. First, EBS and the Sureties were not required to establish that the City failed to comply
with the terms and conditions of the Performance Bond at the time of trial. Rather, the City, as the
party asserting a cause of action for breach of contract, was required to establish all of the elements
necessary to prove that the Sureties breached the terms and conditions of the Performance Bond.
See In re Estate of Dixon, 233 A.2d 242, 244 (Pa. 1967). Thus, any potential failure by EBS and
the Sureties to point out that the City failed to meet its burden of proof at the time of trial does not
result in a waiver of the issue for the purposes of this appeal. EBS and the Sureties raised the issue
at the appropriate time—i.e., after the trial court concluded that the City complied with the terms
and conditions of the Performance Bond. Second, we have reviewed EBS’s and the Sureties’ joint
motion for post-trial relief and Joint Statement and are satisfied that both documents sufficiently
raise the issue of the City’s compliance with the terms and conditions of the Performance Bond.
(See R.R. at 1316a-17a, 6178a.)

                                                  29
required the City to provide both EBS and the Sureties with notice of a violation of
the Contract. EBS and the Sureties contend further that the City failed to provide
the Sureties with the notice required by Paragraph 33(a), and, therefore, the City
deprived the Sureties of their own opportunity to cure EBS’s alleged violation of the
Contract.
      Our analysis of the language of the Performance Bond produces a markedly
different result than our analysis of the language of the Contract.             Unlike
Paragraph 33(a) of the SCRs, which clearly and unambiguously provides that notice
and an opportunity to cure is permissive, Paragraph 3 of the Performance Bond
clearly and unambiguously provides that the City was required to provide EBS with
written notice and an opportunity to cure its violation of the Contract before the City
could call upon the Sureties to perform under the Performance Bond. Paragraph 3 of
the Performance Bond provides, in relevant part, that the Sureties’ obligations “shall
arise after the City has declared a Contractor Default . . . , formally terminated the
[Contract] or [EBS’s] right to complete the [Contract], and notified the Suret[ies] of
the City’s claim under [the] Performance Bond.” (R.R. at 1721a.) The City alleges
that its November 9, 2011 letter to the Sureties fulfilled its requirements under
Paragraph 3 of the Performance Bond, because it notified the Sureties of EBS’s
Contractor Default, it formally terminated EBS’s right to complete the Contract, and
it notified the Sureties of the City’s claim under the Performance Bond. The City
ignores, however, that its November 9, 2011 letter cannot serve as notice of a
Contractor Default because the City was not entitled to declare a Contractor Default.
A Contractor Default is defined under Paragraph 14(c) of the Performance Bond as
“the failure or refusal of [EBS], after written notice from the City, to cure or remedy,
or commence to cure or remedy, a [v]iolation of the [Contract].” (Id. at 1723a

                                          30
(emphasis added).) Thus, without written notice and an opportunity to cure, there
cannot be a Contractor Default, and, without a Contractor Default, the City cannot
invoke its rights under the Performance Bond. Contrary to the City’s assertions, the
informal notices/warnings that Gilbane and/or Daroff gave to EBS during the
various construction progress meetings regarding EBS’s use of plywood rather than
Aqua Tough sheathing in the construction of the parapet walls are insufficient to
satisfy the written notice requirement set forth in the Performance Bond. In addition,
the City has failed to direct our attention to, nor have we been able to locate, any
document in the record that would satisfy the written notice requirement and entitle
the City to declare a Contractor Default under the Performance Bond. For these
reasons, we must conclude that the trial court committed an error of law by
determining that the Sureties breached the Performance Bond, and we reverse the
trial court’s verdict in favor of the City and against the Sureties.
                          C. Breach of Contract Damages
      EBS and the Sureties argue that the trial court committed an error of law by
awarding the City damages for the cost to remove and replace the parapet walls in
connection with EBS’s breach of the Contract. EBS and the Sureties contend that,
even though the City premised its request for damages on an alleged violation of the
Philadelphia Building Construction and Occupancy Code (Building Code), which
EBS and the Sureties allege was the City’s only basis for seeking damages to remove
and replace the parapet walls, the City never established a violation of the Building
Code, and the trial court awarded damages based on findings that EBS breached the
Contract, not that the parapet walls as constructed violated the Building Code. EBS
and the Sureties contend further that the proper measure of the City’s damages for
EBS’s breach of the Contract is the diminution in the value of the Connector
Building because the cost to remove and replace the defective parapet walls was
                                           31
“clearly disproportionate” to the diminution in value caused by the construction of
the parapet walls using plywood rather than Aqua Tough sheathing. EBS and the
Sureties also contend that they did not waive their ability to challenge the City’s
measure of damages because: (1) it was not their burden to introduce evidence as to
diminution in value; (2) they challenged the City’s damages at trial; and (3) the trial
court addressed the issue on the merits thereby eliminating any deemed waiver of
the issue.
      In response, the City argues that the trial court did not commit an error of law
in its valuation of the City’s damages for EBS’s breach of the Contract with respect
to the construction of the parapet walls. The City first contends that EBS waived its
ability to challenge the City’s measure of damages because EBS did not object to
the reasonableness or appropriateness of the City’s damages at the time of trial, and
the trial court’s decision to address the merits of EBS’s argument regarding the
appropriate measure of damages had no effect on EBS’s waiver of the issue. The
City further contends that there is no evidence of record to support EBS’s “assertion
that the cost to remediate the parapet walls was ‘clearly disproportionate’ to the
probable loss to the City,” and, therefore, EBS, not the City, was required to present
evidence on the diminution in the value of the Connector Building, which EBS did
not do. (City’s Br. at 38.) The City also argues that, contrary to EBS’s belief, its
“damages were not solely premised upon the existence of an alleged violation of the
[Building] Code” but also on “EBS’[s] countless breaches of the Contract.” (City’s
Br. at 41.)
      “In order to preserve an issue for appeal, a litigant must make a timely,
specific objection at trial and must raise the issue [in its] post-trial motions.” Reilly
v. Se. Pa. Transp. Auth., 489 A.2d 1291, 1296 (Pa. 1985). It is insufficient “to raise

                                           32
grounds [for an objection] for the first time in [a] post-trial motion[].” Lawrence G.
Spielvogel, Inc. v. Twp. of Cheltenham, 601 A.2d 1310, 1318 (Pa. Cmwlth. 1992);
see also Pa. R.C.P. No. 227.1(b). In other words, “[a] party ‘may not, at the post-trial
motion stage, raise a new theory which was not raised during trial.’” E.S. Mgmt. v.
Yingkai Gao, 176 A.3d 859, 864 (Pa. Super. 2017) (quoting Keffer v. Bob Nolan’s
Auto Serv., Inc., 59 A.3d 621, 630 (Pa. Super. 2012), appeal denied, 69 A.3d 602
(Pa. 2013)). A party that asserts an objection for the first time in a post-trial
motion—i.e., does not make a timely objection at the time of trial—has waived the
objection for purposes of appeal. Id. (noting that even if objection is raised in
Rule 1925(b) statement, objection is still waived for purposes of appeal because
issue not properly raised before trial court cannot be raised for first time on appeal).
      Here, the trial court concluded that EBS and the Sureties waived their ability
to challenge the City’s measure of damages because EBS and the Sureties did not
object to the City’s measure of damages at the time of trial and raised the issue for
the first time in their motion for post-trial relief. We agree. While EBS and the
Sureties contend that the trial court’s conclusion on the issue of waiver is incorrect,
EBS and the Sureties have not directed our attention to any place in the record where
they objected to the City’s measure of damages and/or represented to the trial court
that, in the absence of a Building Code violation, the proper measure of the City’s
damages was the diminution in the value of the Connector Building, not the cost to
remove and replace the parapet walls. Rather, EBS and the Sureties suggest that
they were not obligated to challenge the City’s damages at the time of trial because
it was the City’s burden, not theirs, to introduce evidence on the diminution in value
of the Connector Building. Even assuming, arguendo, that the proper measure of
the City’s damages was the diminution in the value of the Connector Building and

                                          33
that it was the City’s burden to present evidence thereon, the City’s failure to present
any such evidence did not relieve EBS and the Sureties of their obligation to timely
object to the City’s assertion of what EBS and the Sureties believed to be an
improper measure of damages. In other words, this was not simply a matter of
whether the City failed to meet its burden of proof, but rather, whether the basis upon
which the City calculated its damages was appropriate. Under these circumstances,
EBS and the Sureties could not sit idly by under the guise that the City did not meet
its burden of proof and were required to object to the City’s measure of damages.
      Alternatively, EBS and the Sureties contend that, even if they were required
to challenge the City’s damages at the time of trial, they sufficiently did so
because: (1) they “addressed the costs that Mason incurred . . . in connection with
the remediation work during the cross-examination of Mason’s witness”;
and (2) “the cumulative evidence at trial made clear that the remediation work with
respect to the parapet walls was entirely unnecessary.” (EBS’s and the Sureties’
Br. at 57-58.) EBS and the Sureties fail to recognize, however, that, in order to
preserve their challenge to the City’s measure of damages for the purposes of their
post-trial motion and this appeal, they were required to do more than simply
challenge the amount of the City’s damages; rather, they were required to
specifically object to the City’s assertion of what it believed to be the appropriate
measure of its damages. As stated above, EBS and the Sureties have not directed
our attention to, nor have we been able to locate, any place in the record where EBS
and the Sureties lodged such an objection. For these reasons, we must conclude that
EBS and the Sureties waived their ability to challenge the City’s measure of damages
on appeal.

                                          34
       EBS and the Sureties further suggest that, even if they did waive their ability
to challenge the City’s measure of damages by failing to object at the time of trial,
the trial court somehow removed their waiver by addressing the issue on the merits.
In support of this argument, EBS and the Sureties cite American Association of Meat
Processors v. Casualty Reciprocal Exchange, 588 A.2d 491 (Pa. 1991), and
Soderberg v. Weisel, 687 A.2d 839 (Pa. Super. 1997), for the proposition that “where
a party raises an issue for the first time in a post-trial motion and the trial court
nevertheless addresses the issue on the merits, the issue will not be deemed waived.”
(EBS’s and the Sureties’ Br. at 58-59.) EBS and the Sureties fail to acknowledge,
however, that at least Soderberg is factually distinguishable from this case.12 In
Soderberg, the Superior Court decided to address the issues raised by the appellants
for the first time in their post-trial motion because the trial court “was given the
opportunity to correct its errors” and specifically “determined that [the] issues were
not waived.” Soderberg, 687 A.2d at 845. Here, unlike in Soderberg, the trial court
concluded that EBS and the Sureties waived their ability to challenge the City’s
measure of damages but then went on to consider the merits of EBS’s and the
Sureties’ argument, arguably in the interests of judicial economy—i.e., to eliminate
the need for a remand if this Court disagreed with the trial court’s ruling on waiver.

       12
           In American Association of Meat Processors, the Supreme Court rejected an argument
of waiver and considered an issue that the appellant had raised for the first time in its post-trial
motion at least in part because both the trial court and the Superior Court had considered the issue
on the merits. Am. Ass’n of Meat Processors, 588 A.2d at 495. In its decision, the Supreme Court
did not set forth whether the trial court and/or the Superior Court, like the Soderberg court, had
previously determined that the issue had not been waived. Although we cannot state for certain
that American Association of Meat Processors is factually distinguishable from this case, we must
believe that the Supreme Court did not intend for this Court to disregard a trial court’s finding of
waiver just because, in the interests of judicial economy, the trial court explained the rationale of
its decision to avoid a potential remand.

                                                35
In light of this distinguishing fact, we will not ignore the trial court’s finding of
waiver and deem the issue to not be waived simply because the trial court addressed
the issue on the merits.13
                    D. Damages for Delay and Acceleration Claim
       The City argues that the trial court committed an error of law by reversing its
initial findings in favor of the City and awarding EBS damages for its delay and
acceleration claim.        The City contends, rather, that the trial court’s original
conclusion that EBS failed to prove its delay and acceleration claim was well
supported by the terms and conditions of the Contract, including the “no damages
for delay” clause, certain facts admitted by EBS, and the applicable law governing
delay and acceleration claims. The City further contends that there was no basis for
the trial court to vacate its findings/conclusion that EBS failed to prove its delay and
acceleration claim because the “[t]rial [c]ourt cited no evidence to establish any of
the elements it had previously noted were lacking and necessary to support [EBS’s]
delay/acceleration claim”—i.e., causation and damages—but rather, “focused solely
on whether the City had notice of some kind of delay/acceleration claim.” (City’s

       13
           Although we have disposed of EBS’s and the Sureties’ argument relative to the City’s
measure of damages on the basis of waiver, we note that we have no reason to disagree with the
trial court’s award of damages to the City for the cost to remove and replace the parapet walls.
The trial court concluded that “[a]n award of $2,335,400.25 to remove and replace the parapets
was not patently disproportionate to the nearly $40 million the City paid to EBS for its work on
the [Project].” (Trial Ct. Op., May 8, 2018, at 17.) Thus, once the City presented evidence on the
cost to repair and replace the parapet walls, the burden shifted to EBS and the Sureties to establish
that the cost to repair and replace the parapet walls was disproportionate to the diminution in the
value of the Connector Building, which they did not do. See Gloviak v. Tucci Constr. Co., Inc.,
608 A.2d 557 (Pa. Super. 1992) (holding that when costs to repair are not patently disproportionate
to property’s value, it was not essential for homeowners to prove that repair costs were not grossly
disproportionate to diminution in value; rather, if contractor believed cost of making repairs was
disproportionate to diminution in value, burden was on contractor to introduce evidence
establishing that fact).

                                                36
Br. at 47.)   The City also contends that the trial court’s reliance on James
Corporation is misplaced because EBS did not present any evidence to establish
causation or damages in support of its delay and acceleration claim. Lastly, the City
contends that EBS’s delay and acceleration claim is a total cost claim, which is the
least accepted method for establishing delay damages and should only be used under
extraordinary circumstances when there is no other alternative for computing delay
damages.
      In response, EBS and the Sureties argue that the trial court properly awarded
EBS damages in connection with EBS’s delay and acceleration claim
because: (1) EBS met the notice requirements set forth in Paragraph 26(e) of the
SCRs by providing the City with written notices of delay that specifically referenced
activities that were impacted by the delay—i.e., provided a “critical path”
schedule—and a verbal estimate of its acceleration costs; (2) “even if EBS did not
strictly comply with the notice provisions [set forth in Paragraph 26(e) of the SCRs],
the City clearly knew the operative facts giving rise to the construction delays and
EBS’[s] claims for acceleration of the work”; and (3) the no damages for delay
clause set forth in Paragraph 26(f) of the SCRs is unenforceable because the City
actively interfered with EBS’s work on the Project. (EBS’s and the Sureties’ Reply
Br. at 40.) EBS and the Sureties contend further that the trial court properly applied
this Court’s reasoning in James Corporation to the facts of this case in awarding
delay damages to EBS. EBS and the Sureties also contend that EBS was not required
to perform a critical path method analysis to prove causation in support of its delay
and acceleration claim or to prove its damages with mathematical exactness. Lastly,
EBS and the Sureties contend that, contrary to the City’s assertions, EBS did not

                                         37
utilize a total cost method to prove its delay and acceleration damages, but did so
through the detailed testimony of one of its witnesses.
      In its reply brief, the City argues that EBS failed to meet its burden of proof
on its delay and acceleration claim because, while the trial court may have found
that the City knew of EBS’s claim, EBS did not prove causation and damages. In
other words, EBS did not explain how the delay impacted the critical path of the
Project or prove the difference between its total estimate and the total cost that it
actually incurred on the Project.
      “Acceleration damages occur when a contractor speeds up its work at a pace
faster than prescribed in the original contract.” James Corp., 938 A.2d at 483 n.8.
“A contractor may recover for increased costs incurred as a result of accelerating its
performance where ‘(1) its own delays in performance are excusable, (2) the
contractor was ordered to accelerate, and (3) the contractor did so and sustained extra
costs.’” Id. (quoting Dep’t of Transp. v. Anjo Constr. Co., 666 A.2d 753, 757
(Pa. Cmwlth. 1995)). “To establish delay damages, a contractor must establish the
extent of the delay, responsibility for delay, and the damages related to the delay.”
John Spearly Constr., Inc. v. Penns Valley Area Sch. Dist., 121 A.3d 593, 602
(Pa. Cmwlth. 2015). “Ordinarily, ‘no damages for delay’ clauses are enforceable.”
James Corp., 938 A.2d at 484. “However, Pennsylvania law recognizes [that]
exculpatory provisions in a contract cannot be raised as a defense where (1) there is
an affirmative or positive interference by the owner with the contractor’s work,
or (2) there is a failure on the part of the owner to act on some essential manner
necessary to the prosecution of the work.” Id.
      It is undisputed that the Contract contains a “no damages for delay” clause.
Paragraph 26(f) of the SCRs provides, in relevant part:

                                          38
             NOTWITHSTANDING     ANYTHING   TO   THE
             CONTRARY CONTAINED HEREIN, [EBS] AGREES
             AND ACKNOWLEDGES THAT THERE SHALL BE
             NO PAYMENT OR COMPENSATION OF ANY KIND
             TO [EBS] FOR DAMAGES OR COSTS ARISING
             FROM ANY DELAY OR INTERFERENCE WHETHER
             SUCH DELAY BE AVOIDABLE OR UNAVOIDABLE.
(R.R. at 1774a.) EBS was, however, entitled to a reasonable extension of time to
complete its construction under the Contract in connection with unavoidable delays
or interference in the completion of the Contract that were caused by the City.
(See Paragraph 26(c), (f) of the SCRs, R.R. at 1773a-74a.) In order to obtain this
reasonable extension, Paragraph 26(e) of the SCRs required EBS to: (1) notify the
City in writing of the delay or interference, the cause(s) of the delay or interference,
and EBS’s intention to seek an extension of time, all within 5 days of the start of the
delay or interference; (2) submit a written claim to the City for an extension of time
within 10 days of the conclusion of the delay or interference; (3) “demonstrate in
writing the effect of the delay or interference on [EBS’s] construction schedule,
including plotting such effect on [EBS’s] critical path documents, showing
graphically therein the effect on the Contract completion date”; and (4) provide the
City with “an estimate of the costs incurred by [EBS] as a result of the delay or
interference.” (Id. at 1773a-74a.)
      It is also undisputed that EBS failed to formally satisfy the notice provisions
set forth in Paragraph 26(e) of the SCRs relative to EBS’s request for a reasonable
extension of time and its associated claim for delay/acceleration damages. Despite
these undisputed facts—i.e., the existence of the “no damages for delay” clause set
forth in Paragraph 26(f) of the SCRs and EBS’s failure to formally satisfy the notice
provisions set forth in Paragraph 26(e) of the SCRs—the trial court awarded EBS
$505,938 in delay/acceleration damages. In so doing, the trial court, relying on this

                                          39
Court’s prior decision in James Corporation, concluded that: (1) the Contract’s
“no damages for delay clause” was unenforceable because “[t]he City interfered
with EBS’s work by issuing the [n]otice to [p]roceed for the . . . Project even though
the contractor for [Package 1A] had not completed its work[] and did not . . . fully
[do so] until [90] days later”; and (2) EBS informally satisfied the notice provisions
set forth in Paragraph 26(e) because there was an undisputed and significant delay
in turning over the Project to EBS and the City did not grant EBS’s request to extend
its completion date for the Project. (Trial Ct. Op., May 8, 2018, at 23-24.) The trial
court further concluded that Mr. Harris, EBS’s former vice president and project
manager, credibly testified that, as a result of the City’s delay in turning over the
Project to EBS, EBS spent $505,938 on additional supervisory personnel to
accelerate its work on the Project and to ensure that it would timely complete its
work on the Project. (See Trial Ct. Op., May 8, 2018, at 23, 25.) We can find no
reason to disagree with the trial court’s reasoning, analysis, or application of our
prior decision in James Corporation to the facts of this case. Contrary to the City’s
contentions, the trial court addressed all of the elements necessary to support a
delay/acceleration claim, including causation and damages. As a result, we cannot
conclude that the trial court committed an error of law by reversing its initial findings
in favor of the City and awarding EBS damages in connection with its delay and
acceleration claim.
                E. Attorneys’ Fees Under the Performance Bond
      The City argues that the trial court committed an error of law by concluding
that the City was not entitled to an award of attorneys’ fees under the Performance
Bond. The City contends that the trial court’s interpretation of Paragraph 7 of the
Performance Bond leads to an absurd result because “the Suret[ies] would only be
liable for legal fees if the Suret[ies] stepped into the shoes of the contractor, in this
                                           40
case EBS, and performed the work using EBS or a contractor approved by the City[;
i]n other words, the Suret[ies] would be liable for legal fees if [they] performed but
not liable if [they] failed to perform.” (City’s Br. at 58.) The City contends further
that a more sensible reading of the Performance Bond “would be that the Sureties
are responsible for legal fees if they do not perform as required under the
[Performance] Bond.” (City’s Br. at 58-59.) The City also contends that the trial
court improperly construed the language of Paragraph 7 of the Performance Bond
against the City because there was no ambiguity in the language of the Performance
Bond.
        In response, EBS and the Sureties argue that the trial court properly concluded
that the City was not entitled to recover attorneys’ fees from the Sureties under the
Performance Bond, because the City failed to terminate the Contract or EBS’s right
to complete the Contract or declare a Contractor Default under the Performance
Bond. As a result, the Sureties were not obligated to perform under the Performance
Bond and could not be held liable for any damages thereunder, including attorneys’
fees. EBS and the Sureties further contend that the Sureties denied liability under
the Performance Bond and did not proceed under Paragraph 4(a) or (b), and, as a
result thereof, the City’s remedy was limited to Paragraph 6 of the Performance
Bond, which, unlike Paragraph 7, did not entitle the City to recover its attorneys’
fees from the Sureties. EBS and the Sureties also contend that, to the extent that the
Performance Bond was ambiguous on the issue of attorneys’ fees, the trial court
properly construed such ambiguity against the City, the drafter of the Performance
Bond. Lastly, EBS and the Sureties argue that, even if the City would be entitled to
“additional legal costs” under Paragraph 7 of the Performance Bond, courts have

                                          41
interpreted the language “additional legal costs” to mean administrative legal costs,
not legal costs incurred during litigation.
      In its reply brief, the City argues that the Sureties’ obligation to perform under
the Performance Bond was in fact triggered because the City’s November 9, 2011
claim letter to the Sureties specifically indicated that the City had closed out the
Contract and that EBS no longer had the right to complete the Contract. The City
also reiterates that the trial court’s interpretation of Paragraph 7 of the Performance
Bond leads to an absurd result because the Sureties will only be liable for attorneys’
fees in the event they perform under the Performance Bond, not when they fail to
perform.
      As explained more fully above, the City could not assert a claim against the
Sureties under the Performance Bond because the City was not entitled to declare a
Contractor Default—i.e., the City neglected to satisfy the provisions of the
Performance Bond requiring the City to provide EBS with notice and an opportunity
to cure. In other words, the Sureties were not obligated to perform under the
Performance Bond and, therefore, cannot be held liable to the City for any damages
thereunder, including attorneys’ fees. As a result, we cannot conclude that the trial
court committed an error of law by concluding that the City was not entitled to an
award of attorneys’ fees under the Performance Bond, and we affirm the trial court’s
decision on this issue on alternative grounds.

                                          42
                                 IV. CONCLUSION
       For all of the above-stated reasons, we affirm, in part, and reverse, in part, the
trial court’s order.

                                           P. KEVIN BROBSON, Judge

Judge Fizzano Cannon did not participate in the decision of this case.

                                           43
         IN THE COMMONWEALTH COURT OF PENNSYLVANIA

Ernest Bock & Sons, Inc.                :
                                        :
              v.                        :
                                        :
City of Philadelphia                    :
                                        :
              v.                        :   No. 349 C.D. 2018
                                        :
Liberty Mutual Insurance Company,       :
and Fidelity and Deposit Company        :
of Maryland                             :
                                        :
Appeal of: Ernest Bock & Sons, Inc.,    :
Liberty Mutual Insurance Company        :
and Fidelity and Deposit Company        :
of Maryland                             :
                                        :
                                        :
Ernest Bock & Sons, Inc.                :
                                        :
              v.                        :
                                        :
City of Philadelphia                    :
                                        :
              v.                        :   No. 350 C.D. 2018
                                        :
Liberty Mutual Insurance Company        :
and Fidelity and Deposit Company        :
of Maryland                             :
                                        :
Appeal of: City of Philadelphia         :

                                   ORDER
        AND NOW, this 12th day of August, 2020, the order of the Court of Common
Pleas of Philadelphia County is hereby AFFIRMED, in part, and REVERSED, in
part.

                                        P. KEVIN BROBSON, Judge