K&L Gates Construction Law Blog

Court overturns City Rejection of Low Bidder based on alleged lack of Necessary Experience

Hillside Landscape Constr. Inc. v. City of Lewiston 151 Idaho 749, 264 P.3d 388 (2011)

The City of Lewiston received multiple bids on a public works project.  It rejected the low bidder’s offer on the ground that the low bidder lacked sufficient experience for the project.  The low bidder brought an action against the City for declaratory relief, injunctive relief, and damages.  The district court dismissed the complaint, and the low bidder appealed.

The Supreme Court of Idaho reversed, concluding that the City could not reject the bid on the ground of lack of experience because the City elected to follow Category A bid procedures.  Under Category A, the City “may only consider the amount of the bid, bidder compliance with administrative requirements of the bidding process, and whether the bidder holds the requisite license.”  Id. § 67-2805(3).  The City “shall award the bid to the qualified bidder submitting the lowest responsive bid.”  Id.  Under Category B the city may consider other factors, such as sufficient work experience and other prequalification standards.  Id. at 67-2805(3)(b)(i).

In this case, the contractor applied under Category A, and the city added further requirements, such as previous work experience and other prequalification standards from Category B.  The Supreme Court held that “adding any further requirements, either before or after inviting the bids, required the city to proceed under Category B.”  The Court concluded that because the City had followed the Category A procedures, it could not reject the low bidder on the ground of insufficient work experience.  This case demonstrates that once a city elects to use one Category, it cannot evaluate a bid using procedures from the other Category.  Under Category A, a “lowest responsible bidder” analysis must occur before, not after, the project is open for bidding.

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