Volume 8 - Number 15 | April 12, 2010

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Recent Issues

  EDITOR'S NOTES | Issue 8-15
The evaluation of bids and proposals is not as cut-and-dried as it used to be. Traditionally, a bid was accepted if it was low, did not take exception to the contract requirements, and was supported by the necessary bonding. Procurement methods and statutes have evolved, however. Public authorities now find themselves making "best value" determinations, as well as other judgments regarding the bidding entities themselves.

The Ohio Supreme Court recently addressed a public project owner's finding that a low bidder was not the "best" bidder because of prior complaints of prevailing wage law violations. The court said the procuring authority was entitled to establish criteria for judging a "best" bidder. And prevailing wage compliance was a legitimate consideration. But, having established evaluation criteria, the owner was obligated to follow and apply them reasonably.

Other cases this week addressed a no-damage-for-delay clause and the interpretation of ambiguous drawing details. The subcontract containing the delay damage disclaimer stipulated the governing law. Unfortunately for the drafting party, the law of that state rendered its disclaimer void and unenforceable. And, it was impossible to determine whether a contractor had relied on its alleged interpretation of the drawings without an explanation of the contractor's quantity take-offs.
  LOW BIDDER IMPROPERLY REJECTED DUE TO WAGE PAYMENT HISTORY

A public project owner’s treatment of a bidder’s prior settlement agreement for wage underpayment was inconsistent with the owner’s stated bid evaluation criteria.
  SUBCONTRACTOR RECOVERS ONE MILLION DOLLARS IN LOST EFFICIENCY – DELAY DAMAGE DISCLAIMER UNENFORCEABLE
A no-damage-for-delay clause in a subcontract was unenforceable under applicable state law. The subcontractor was entitled to recover for lost efficiency incurred when it was forced to alter its planned method and sequence of performance.
  INTERPRETATION OF DRAWINGS REQUIRED EXPLANATION OF COMMUNICATIONS AND QUANTITY TAKE-OFFS
Post-award communications and contractor quantity take-offs were not self-explanatory. Testimony would be required to determine the meaning of disputed contract documents.