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EDITOR'S NOTES | Issue 9-11

publication date: Mar 14, 2011
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Public project owners have long complained about certain contractors they consider “overly litigious” or even “claim mongers.” In recent years, they have been fighting back. A trend is emerging in which public entities investigate a low bidder’s claim history and then use that history to disqualify the low bidder as nonresponsible. Generally speaking, the courts are allowing this.

In a recent Ohio case, the low bidder on a school project had pursued a successful claim against the school district several years earlier. The school district said the bidder was not responsible, citing a variety of factors. But there was little question the district was motivated by its prior claim experience.

The bidder complained it had recovered 90 percent of the demanded amount, so its claim had not been frivolous. And, rejection of the low bid would cost the taxpayers an additional $109,000. But to no avail. The school district had discretion to disqualify the low bidder as nonresponsible.

Other cases this week addressed a municipality’s waiver of its sovereign immunity and a “best value” cost/technical trade-off. When the municipality counterclaimed against a contractor, it lost the protection of a state statute that limited contractor recovery under the contract. And it was permissible for a procuring agency to distinguish proposals based on only one of several equally weighted technical evaluation factors.



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