The bidder on a prime contract necessarily relies on price quotations from prospective trade subcontractors. Can that bidder, if awarded the prime contract, be confident those prices will be honored? The financial consequences of repudiated prices can be severe. Yet, no binding contract was formed prior to bid submittal.

The Nevada Supreme Court recently held an electrical contractor to its pre-bid price quotation. The bidder on the prime contract reasonably relied on the quote. The bidder was foreseeably damaged when the electrical contractor reneged on its price after award of the prime contract. And, the measure of those damages was the same as for a breach of contract –the amount the prime contractor paid replacement electrical contractors in excess of the price quotation incorporated into the bid.

Other cases this week involved a directive that altered the contract specifications and an alleged government misrepresentation of the construction season. The directive was not a breach of contract, as the agreement included a changes clause. But, the contractor waived the right to additional compensation by failing to give timely written notice of the claim. And, the completion deadline in a contract to be performed in Alaska did not warrant that construction would be feasible up to that date.