By: Lester Gulitz Published: July 2015

Bidding Do-Over Allowed

A recent decision1 in the Appellate Division, Fourth Department, affirmed the adage that if you don’t get it right the first time, try, try, again, applies to public bidding in New York State.

Here, the Contractor was the low bidder on a County project and was awarded the contract.  During its post-bid review, however, the Contractor discovered “two unconscionable and substantial clerical errors”, whereby it omitted the costs for two subcontractors from its bid.  The Contractor asked the County for permission to withdraw its bid.  The County granted the request and returned the Contractor’s bid bonds.  The County also notified all bidders of the situation, and told them that it intended to rebid the contract. 

The County advertised for bids and the bids were opened, only to find that the same Contractor was again the low bidder.  The County again awarded the contract to the Contractor, however, this time, the second low bidder objected and commenced an Article 78 proceeding, seeking to disqualify the low bidder from participating in the rebid, vacating the award of the contract and directing the County to award the contract to the second low bidder.   The Supreme Court agreed and vacated the contract.  The County and the low bidder Contractor appealed the Appellate Division, Fourth Department.

The appellate court indicated that the sole remedy for a bid mistake under the General Municipal Law is the withdrawal of that bid and the return of the bid bond to the bidder.  That is what the County did said the court.  Under the General Municipal Law, said the court, the County is also permitted, in its discretion, to award the contract to the next lowest responsible bidder or rebid the contract.   The County, said the court, acted within its discretion when it decided to rebid the contract, rather than award the bid to the next lowest bidder.

The appellate court also said that the General Municipal Law is silent on the question whether a contractor that was permitted to withdraw its bid may or may not participate in the rebid.   Since the Legislature did not forbid a contractor in that situation from participating in a rebid, the court said, “a court cannot by implication supply in a statute a provision which it is reasonable to suppose the Legislature intended intentionally to omit”.  Accordingly, the court refused to read in an implicit prohibition against allowing the contractor, who previously withdrew its bid, to participate in the rebid.

The Contractor’s rebid, said the appellate court, was not an amendment to or reformation of a bid to rectify an error, which is prohibited by the General Municipal Law.  The Contractor’s bid was just like the bids submitted by the other bidders on the rebid, and it did not compromise the integrity of the competitive bidding process.


1 Matter of Concrete Applied Tech. Corp. v. County of Erie, 2015 NY Slip Op 06087

 

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