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Suburban Disposal, Inc. v. Township of Fairfield

383 N.J. Super. 484, 892 A.2d 720 (App. Div. 2006)

PUBLIC BIDDING—In a bidder’s offer, the term “No-Bid” is ambiguous and can’t be construed to mean that the requested services would be furnished at no cost as part of the basic bid.

A municipality requested public bids for a one year, three year, or five year contract to collect trash within the municipality. The bidders could offer, in addition to basic services, removal of roll-off containers, collection of school wastes, collection of grass clippings, and separate collection of white metal and goods. The low bid was a three year bid to provide basic service, and roll-off container removal. As for separate collection of white metals and goods, the low bidder’s bid stated: “No Bid.” After the final date to submit bids, the municipality contacted a representative of the then current trash collector (who had submitted a bid), to confirm that the collection of white and metal goods was considered a basic service and not an additional service under its bid. The municipality then adopted a resolution awarding the contract to that bidder. The next lowest bidder sued, claiming that awarding the contract was unlawful. The low bidder then claimed that when its bid stated “No Bid” next to collection of white and metal goods, it was intended to mean that it was included in its base bid at no extra cost to the municipality. The lower court agreed. In the alternative, the lower court found that an ambiguity in the phrase “No Bid” was a nonmaterial defect that the municipality could waive upon receiving clarification from the bidder.

The Appellate Division disagreed and reversed. It found that the phrase: “No Bid” was unambiguous and could not be construed to mean that the services would be provided at no cost. It noted that if the municipality had tried to compel collection of white metal against the bidder’s wishes, the low bidder could rightly assert that it did not bid on that service. The Court noted that the low bidder’s bid was not defective, and did not need clarification. Rather, the bid was conforming but did not include collection of white and metal goods. The clarification was a change in the bid after the bids were opened. By law, no material element of a bid may be provided after the bids are opened. Therefore, the low winning bidder was not permitted to, in effect, change its bid by claiming that it intended to include the additional service as part of the basic service. On the other hand, the Court noted that while the winning bidder was permitted to sweeten its bid, none of the other bidders were offered the same opportunity. The Court set aside the contract, which has two years left to run and awarded the contract for the balance of the term to the next lowest bidder.


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