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Jottan, Inc. v. Township of Willingboro

A-5882-99T3 (N.J. Super. App. Div. 2000) (Unpublished)

PUBLIC BIDDING—Where a municipality requires that bidders be pre-qualified with respect to their State “aggregate rating limit,” a bidder that does not meet that requirement as of the bid date is not a qualified bidder even if the State was in the process of raising that bidder’s limit at the time of bidding.

A municipality solicited bids from contractors to re-roof a municipality owned building. The solicitation called for the bids to be received by a set date and time. Several bids were received and the contract was slated to be awarded to the lowest bidder. The second lowest bidder filed suit asserting that the lowest bidder failed to conform its bid to the bidding documents. Specifically, the solicitation required every bidder to be pre-qualified by the Department of the Treasury, as required in bidding for state contracts, and that a determination be made of the bidder’s “aggregate rating limit” pursuant to N.J.A.C. 17:19-2.9 which limits the dollar value of State contracts that a contractor may perform at any given time. In essence, the statute provides that “a contractor shall not be awarded a contract which, when added to the uncompleted portions of all other currently held contracts from whatever source (public or private), would exceed the contractor’s aggregate rating limit. . . .” The bidding documents also required each contractor to submit a “Total Amount of Uncompleted Contracts Form” which sets forth the value of uncompleted contracts. In response to these requirements, the lowest bidder submitted an application to have its aggregate rating limit increased from one million dollars to three million dollars. The next lowest bidder asserted however that the lowest bidder’s aggregate rating limit was exceeded as of the bid submittal date and therefore its bid could not be considered. After the complaint was filed, the agency that determines rating limits orally assured the lowest bidder that it would receive the increased rating limit requested; however, the rating limit increase would not take effect until after the bid submittal date. The lower court entered an order temporarily restraining the municipality from awarding the contract to the bidder and an order to show cause why the contract should not be awarded to the next bidder. At summary judgment stage, the lower court held that because the lowest bidder’s aggregate value limit was exceeded, it was not qualified to bid on the contract and directed the municipality to not consider its bid. Thereafter, the municipality awarded the contract to the next bidder. The lowest bidder appealed and the Appellate Division affirmed for the reasons articulated by the lower court. The Appellate Division recognized that although the municipality was not required to do so, the bidding requirements required each prospective contractor to be pre-qualified by the Department of Treasury and to submit the paperwork detailing the total amount of uncompleted contracts. All of the prospective bidders followed these requirements; however, as of the date that the bids were due, the lowest bidder did not meet the requirements. Because the conditions and specifications were equally applied to all bidders, all bids had to conform to the terms imposed.

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