Walsh v. Mayor of New York — 22 N.Y. St. Rep. 308

Majority

p. 308

Joseph Walsh, App’lt, v. The Mayor, etc., of the City of New York, Resp’t.^[1]

(Court of Appeals,

Filed March 26, 1889 )

Headnote

Municipal cobpobations—NewTobk (city op)—Contbacts fob xmpboveMENTS—To WHOM AWABDED—LAWS 1861, CHAP. 308.

The department of docks advertised for proposals for doing certain, work. Upon opening the "bids it appeared that bidders other than the plaintiff proposed to do the work for less than he bid. The bids of such others were, however, informal, and the commissioners rejected all bids .■and advertised anew. The plaintiff contends that by virtue of provisions •of Laws 1861, chapter 308, entitled “ an act relative to contracts by the mayor, etc.,” and which provides that all contracts “ shall be awarded to the lowest bidder for the same with adequate security, and every such contract shall be deemed confirmed in and to such lowest bidder at the time of -the opening of the bids, estimates or proposals therefor, and such contract shall be duly executed with such lowest bidder,” his bid being the "lowest formal bid entitled him as matter of right to an award of the contract. Held, that the act never intended to compel the making of a contract even with the lowest"bidder, if it were plain that all the bids were in ■excess of the real cost of the work; that if the true interests of the city •demanded, the commissioners acting in good faith would have the right to -reject them all and advertise over .again; that under the law no contract •could be let to any person other .than the lowest bidder with adequate security, and whether to him is a question for the body awarding the contract acting in good faith.

p. 309

Appeal from a judgment of the New York superior court, general term.

E. J. Myers, for app’lt; D. J. Dean, for resp’t.

—In June, 1881, the department of docks of the city of New York advertised for proposals for doing work (Í) for building pier No. 57, North river/ (2) for repairing six piers on the same river. In the advertisement for proposals for such work the department notified all bidders that “the right to decline all estimates is reserved if deemed for the interest of the corporation.”

Three proposals were received for building pier 57, and two were received for repairing the six piers. Upon opening the bids it appeared that bidders other than the plaintiff proposed to do the work for sums which in the aggregate for both jobs were $14,500 less than the bids of the plaintiff for the same work. The bids of such others were, however, informal, as they were not accompanied by the proper checks provided for by ordinance of the city, and hence no contracts could be awarded to such bidders. The -commissioners of the dock department therefore rejected all the bids and advertised anew, and awarded contracts for the work to the lowest bidders under such readvertisement, and they refused to enter into contract with the plaintiff, who was the lowest bidder on the first advertisement, whose bid was regular.

_ The plaintiff now claims that the commissioners had no right to reject his bid, and has brought this action to recover damages for their refusal to enter into contract with him and to permit him to carry it out. It is admitted that his damages, if the refusal of the commissioners were illegal and the action can be maintained, amount in all, on both jobs, to $16,000.

The court directed a verdict for that sum, subject to the ■opinion of the court at general term upon a case made, and that court directed judgment for the defendant, from which the plaintiff appeals here.

There were other questions made in the case, among •others, that the plaintiffs’ own bids were irregular; but in the view we take of the case, it is not necessary to discuss •or decide them.

The plaintiff contends, that by virtue of the provisions of chapter 308, of the Laws of 1861, entitled “An act relative to contracts by the mayor, aldermen and commonalty of the city of New York,” his bid, being the lowest formal bid, entitled him as a matter of right to an award of the contract at the time of the opening of the bids.

It is true that the language of that act is quite peremptory, and provides that all contracts “shall be awarded to

p. 310

the lowest bidder for the same, with adequate security, and' every such contract shall be deemed confirmed in and to-such lowest bidder at the time of the opening of the bids,, estimates or proposals therefor, and such contract shall bel forthwith duly executed with such lowest bidder.” Under-such law it is quite clear that no contract could be let to* any person other than to the lowest bidder with adequate security. The obvious purpose was to secure to the city the advantages of having its work done by the lowest bidder therefor, after proper advertisement.' I do not think that it meant to compel the making of a contract, even. with such lowest bidder, if it were plain that the bids were all largely in excess of the real cost of the work. If, by combination or other cause, all of the bids were greatly in excess of such cost, and it so appeared to the commissioners, and that the true interests of the city demanded that-none of such bids should be accepted, we think that such commissioners, acting in good faith, would have the right to reject them all, and advertise over again.

The existence of such a power might frequently be necessary to protect the city against fraudulent combinations, evidenced perhaps by informal bids for low prices, and if' such power did not exist, ending in the award of a contract to the lowest bidder whose bid was formal, but at a price* enormously in excess of the real cost of the work. It was-never intended, as we think, to render it absolutely necessary in such a case for an award of the contract to such a. bidder. It was meant that no contract should be awarded, to any but the lowest bidder, and whether to him or not, would be a question for the body awarding the contract, acting in good faith, and for what they deemed the true interests of the city.

If otherwise, if there were but one bid, and that vastly in advance of a fair price and decent profit, nevertheless, the city would be bound to have such a contract saddled upon it. It would require the plainest commands from the-legislature before we should be able to bring ourselves to* think for a moment that any such result was intended.

We do not think that the act cited contains such language, or that it was ever intended to accomplish any such end.

In this case those who proposed to bid were distinctly warned in the advertisement that this right to decline all proposals was reserved, if it were deemed for the best interest of the city so to do.

The good faith of the commissioners is not impugned and indeed it would be difficult to do it successfully in face of the fact that the plaintiff’s bids were in the aggregate over $14,000 more than other bids made at the same time which were simply informal; and upon a re-advertisement, the bids which were accepted were for a much less aggregate sum

p. 311

than were the plaintiff’s bids on the original advertisement.

There are no cases to which the plaintiff has called our attention that are in conflict with these views, and they lead to an affirmance of the judgment, with costs.

All concur.