THASSIAN MECHANICAL CONTRACTING, INC. VS. EAST BRUNSWICK BOARD OF EDUCATION (L-4865-19, MIDDLESEX COUNTY AND STATEWIDE) ( 2020 )

NOT FOR PUBLICATION WITHOUT THE
APPROVAL OF THE APPELLATE DIVISION
This opinion shall not "constitute precedent or be binding upon any judge." Although it is posted on the
internet, this opinion is binding only on the parties in the case and its use in other cases is limited. R. 1:36-3.
SUPERIOR COURT OF NEW JERSEY
APPELLATE DIVISION
DOCKET NO. A-5149-18T1
THASSIAN MECHANICAL
CONTRACTING, INC.,
Plaintiff-Respondent,
v.
EAST BRUNSWICK BOARD
OF EDUCATION,
Defendant,
and
HANNA'S MECHANICAL
CONTRACTORS, INC.,
Defendant-Appellant.
____________________________
Argued December 11, 2019 – Decided January 6, 2020
Before Judges Koblitz, Whipple and Gooden Brown.
On appeal from the Superior Court of New Jersey, Law
Division, Middlesex County, Docket No. L-4865-19.
Robert T. Lawless argued the cause for appellant
(Hedinger & Lawless, LLC, attorneys; Robert T.
Lawless, on the briefs).
Thomas J. Hirsch argued the cause for respondent.
PER CURIAM
Defendant Hanna's Mechanical Contractors, Inc., the third lowest bidder,
appeals from a July 24, 2019 order vacating the East Brunswick Board of
Education's rejection of plaintiff Thassian Mechanical Contracting, Inc.'s bid
and directing the Board to award the bid for project number 2020-06 to plaintiff,
the lowest bidder.1 We granted a stay and now affirm substantially for the
reasons set forth on the record by Assignment Judge Alberto Rivas.
In April 2019 the Board solicited bids from contractors for an upcoming
project at Churchill Junior High School. The project, designated as bid number
2020-01, was for HVAC upgrades and a roof replacement. The bids were issued
with three different pricing options: pricing for the complete HVAC upgrade s
and roof replacement, pricing for the HVAC upgrades only, and pricing for the
roof only. Plaintiff was among the contractors who submitted bids on May 16,
2019 for bid 2020-01.
1
The Board takes no position on appeal.
A-5149-18T1
2
On May 22, 2019, the Board rejected all bids for bid 2020-01 due to
material defects and decided to split the HVAC upgrades and the roof
replacement into two separate projects. On June 4, 2019, the Board solicited
new bids for the HVAC project, designated as bid number 2020-06, the bid at
issue on appeal. The Board received four bids for 2020-06: plaintiff's for
$7,196,000; EACM Corp.'s for $7,227,000; defendant's for $7,385,000; and
AMCO Enterprises, Inc.'s for $7,491,000.
Prior to the Board's meeting, an agenda was posted online stating that
plaintiff was the lowest bidder for bid 2020-06. The agenda also indicated that,
"upon a review of the bid submissions and advice of legal counsel, the bids of
[plaintiff] and EACM Corp., the first and second low bidders, must be rejected
as the subcontractors for each did not submit the proper bid forms, namely the
sworn contractor certification."
The Board informed plaintiff that its bid was being rejected because of
plaintiff's failure to meet the requirements of N.J.S.A. 18A:7G-37. The letter
from the Board attorney states:
N.J.S.A. 18A:7G-37 provides that a prequalified
contractor and any qualified subcontractors required to
be named shall submit, as a condition of bidding, a
sworn contractor certification. [Plaintiff's]
subcontractors submitted the certifications for a prior
bid, Bid #2020-01, and not Bid #2020-06. As the
A-5149-18T1
3
proper forms were not submitted, [plaintiff's] bid must
be rejected.
The contract for bid 2020-06 was awarded to defendant, whose bid was
$189,000 more than plaintiff's bid.
Judge Rivas in an oral decision vacated the Board's rejection of plaintiff's
bid and awarded bid 2020-06 to plaintiff as the "lowest responsible bidder." In
rendering his decision, the judge first acknowledged the well-settled law of
public bidding discussed in Hillside v. Sternin, 25 N.J. 317, 326 (1957). He
pointed out that a material defect in a bid may not be waived, while "minor
inconsequential variances and technical additions may be the subject of a
waiver." The judge discussed the two-part test set forth in Twp. of River Vale v.
R.J. Longo Constr. Co., 127 N.J. Super. 207, 216 (Law Div. 1974) and adopted in
Meadowbrook Carting Corp. v. Island Heights Borough, 138 N.J. 307, 315
(1994) to determine whether a non-conforming bid is waivable. The judge
restated the two-part test as: 1) "whether the effect of the waiver would be to
deprive the municipality of its assurance [that] the contract would be entered
into, perform[ed], and guarantee[d] according to its specified requirements" and
2) whether the defect is "of such [a] nature that its waiver would adversely affect
competitive bidding by placing a bidder in a position of advantage over the other
A-5149-18T1
4
bidders [or] by otherwise undermining the necessary common standard of
competition."
Judge Rivas first analyzed plaintiff's bid under N.J.S.A. 18A:7G-37,
which requires the bids to contain sworn contractor certifications from the
prequalified contractor and its qualified subcontractors. The judge rejected
defendants' argument that plaintiff's use of subcontractors' sworn certifications
from a prior bid invalidates the current bid under the statute. The judge found
that plaintiff's sworn certifications from its subcontractors from the previous bid
were "essentially identical and approximately three weeks apart" from bid 2020-
06 and "could reasonably be waived because every representation sworn to by
the subcontractors [is] independently verifiable and supported by additional
documents submitt[ed] in the bid."
Second, the judge found that plaintiff's submission of its subcontractors'
prior sworn certifications "did not in any way influence plaintiff's bid." The
judge also found "no evidence that indicates that the waiving of the
subcontractor sworn certification requirements would place bidders on un even
footing." After finding the error waivable, the judge considered the Board's
failure to waive the minor defect and concluded that the Board's decision was
A-5149-18T1
5
"arbitrary, capricious, or unreasonable and not supported by substantial credible
evidence in the record as whole."
He found that the rejection of plaintiff's bid as the lowest bidder
"depriv[ed] East Brunswick residents of a $189,000 saving." The judge stated
that the "statute was not meant to cost public bodies many thousands of dollars
by requiring the acceptance of a higher bid for [a] mere technical violation."
"The standard of review on the matter of whether a bid on a local public
contract conforms to specifications . . . is whether the decision was arbitrary,
unreasonable or capricious." In re Protest of the Award of On-Line Games Prod.
& Operation Servs. Contract, Bid No. 95-X-20175, 279 N.J. Super. 566, 590
(App. Div. 1995). An appellate court will not reverse a public entity's decision
unless it is "shown to have been 'arbitrary, capricious, or unreasonable, or [] not
supported by substantial credible evidence in the record as a whole.'" Barrick
v. State, 218 N.J. 247, 259 (2014) (alteration in original) (quoting In re Stallworth,
208 N.J. 182, 194 (2011)). "The essential question to be determined is . . .
whether [the authority's] decision represented a 'clear abuse of discretion.'"
Waste Mgmt. of N.J., Inc. v. Union City Utils. Auth., 399 N.J. Super. 508, 526
(App. Div. 2008) (quoting Kramer v. Bd. of Adjustment, Sea Girt, 45 N.J. 268,
A-5149-18T1
6
296–97 (1965)). The judge is "obligated to give deference to the [a]uthority's
determination." Waste Mgmt., 399 N.J. Super. at 525.
After careful de novo review, and giving the Board the required legal
deference, we agree with Judge Rivas's determination that the minor defect in
the bid was not material, and the rejection of the lowest bidder in these
circumstances was an abuse of the Board's wide discretion.
Affirmed.
A-5149-18T1
7