getting right to the heart of the matter your honour's the district court found as a matter of law that requirements contract which it was our position this wise has to have exclusive that he expire sleigh stated and it cannot be implied or let's assume we agree with you for a minute that it doesn't have to be explicit it's awfully strange to see something that you think is a requirement contract it doesn't say that it's a requirement contrary isn't it i mean woods was troubling me about this this case quite frankly is that if we assigned a project to a st year law student to write a requirement contract this contract would have gotten half be agrees to sell the buyer all the buyer requires at the price of sixty four dollars a ton period that's pretty clear requirements contra right that would be the best language to use and while i would  e it's not hard it's simple instead we've got a very convoluted scenario here we've got all of the co op as the intermediary on behalf of some two hundred dollars government entities and not one purchase a certain quantity of salt not a certain quantity a quantity that's not reasonably disproportionate to their estimates that is what the requirements contract is and under new jersey that's adopted that section on outputs you requirements contracts it provides that if you stayed in aston and either used a lot in cases where goods you don't know how much you're going to need and that's the case for and since you know we can predict what a winter had so your client didn't write this but your client wanted to be excepted for performing this way it but this this bid so specification says quote no minimum order solicited your honor i think that that was referring to when they placed their md in separate orders on the counties that are part of this agreement also netted estimates and that's what they're being held to in this case proportionally held to yes your honor yes so your your argument is that they had to buy precisely what their estimates were in the proportion now your honor i'm gay don't have to provide that by that exact point they don't know what was the persuasive and there if they're giving you what they're fatwas when they wrote it it's not binding the comment i think it's the actual goal that you look at itself and as i said two years before we entered into this contract did jersey superior court found that that another contract that m c c p c entered into with an asphalt provider and the talk on case was a requirement contract and it provided only the estimates it did not provide that they had to provider waived that argument by continuing to produce it in just a question amounts so we have that case and that's a very on point from a new jersey court it is not binding and that is why the sparta your honor that is not what they say that is a that's an administrative court case and in that case there was not an m c c p c contract even at issue there was a dispute in that case between whether  a cooperative or a board had formed an order to buy oil and one of the members sparta said and discovery by the way we have a contract or m c c p c where we can buy oil from anyone that was their representation and discovery and we don't have the language of that contract and it was not an issue before the administrative court judge that was just sparta's position it's one of the members and of the m c c p c so obviously that's its possession but as much fuel oil as it wanted nadim star map on to the language of the contract issue in this appeal doesn't your honor i believe that he was making all of that when he was discussing for about twenty pages what was shown on discovery i don't think that he ever made that finding new are what i see how he could when that language of mine even before him for that contract we have in trying to predict what the jersey supreme court might do would or would do with this case do we have any other benchmarks besides seventy can be implied now they're not exactly on point but i will say in both of them they conduct their discovery because you're talking about filling in a gap filler for a missing element and that in a condom again let's let's assume we agree with you that exclusivity can be implied he's still going to have a good reason you implied in this contract and what i'm wrestling with is even though there are estimates here those estimates don't suggest as far as i can tell that the government entities proffering those estimates might not choose to buy salt from one or two other salt providers in addition to your client what am i missing there because it's implied otherwise it's a looser a contract well that's what i'm saying i think it may be that was very contra that's what i'm trying to get at i mean it looks to me like your client was raked over the coals quite frankly reliance that it was going to be selling a lot of salt to the members of the co op you agree with all that i said yes right ok the problem is your client didn't go she a contract that required any of those entities to actually buy all of their requirements from your client where where does it say that they have to buy all of their requirements from your client and if they didn't have to buy all of one hundred percent of their requirements then you need to show us what quantity other than their requirements they were old lived by law to purchase we are that's the whole issue with requirements contracts with exclusive a b and inferred it's not in competitors who by the way were in the same bidding process the public bidding process and lost we got this public bent they're required to do this public bed we really don't have a right to you know change the contract at all  ten thousand people doesn't need to go through public bids they can just shop it around is that how this happened how you got underground trying to understand how you got undercut obviously that undercut because your sixty four dollars price was broadcast to all your in aggregate over what is it seventeen thousand five hundred dollars then they were required to do public bidding well right there if you want discovery to find out if there was an aggregate amount that was over seventeen thousand five hundred dollars because then those would be illegal only way of showing requirements contract is if it is exclusive then then you've got a requirement a contract if it's not exclusive you don't but what the new jersey u c c when it defines requirements contract doesn't say anything about exclusivity so why couldn't it be that you have a requirements contract that is inconsistent with the way the u c c is structured in new jersey that says you can't be disproportional these estimates and maybe d because your grievance was that you're over asking us not shopping this around to others so why are you telling us that it if the only way it can be a requirement contract is if it's exclusivity that may be what black's law says that that's the gap filler again except in your quantity and reasonably disproportionate and he stated estimate and again we did cite to that language to the court allow and that was our backup argument that we don't need it but the district also said it was not clear that they needed it but i think we have it even if we don't need it if it was required until going to i might not have had the same we should contract claim because it would have been obligated regardless of the estimates wasn't your honor is because the co op and michigan netted in their briefing that this is a requirement contract and we were only filing for reconsideration on that one issue so why would we include them in that but it's district a that i have put it up recently but of you might be able play with the flexibility rule three you might be able to play if you fell short on one but why can you just fall short on two i mean the rule kind of has no meaning if we what taken it had the st group and had the nd group but then it included again as judge phipps pointed out the specific reference to the motion for reconsideration  exclusion of the m c c p c it was a deliberate articulated in their brief exclusion of the m c c p c in fact the reason that we got the motion was because when we received the appeal we  assume the m c c p c that we were not included in there you were put on notice that you weren't a party to the appeal that beat through through the electronic system and we looked at it very carefully to see if we are and it was only when the civil appeal information statement was filed by subsequent counsel again not counsel's arguing here but subsequent counsel that they raised the issue that the m c c p c was included in the now so what is going on with this contract i mean this this strikes me as truly strange you got all the benefit you in your i don't know and c c b c get all the benefit but your constituents get all the benefit of the purchasing power of your organization emitter american get nothing out of the deal what if they get it they've got an option to sell you salt it at sixty four dollars a ton if you're a member's soffit to purchase salt from them that's all they got there's nothing in the contract and i think that's where we have to focus the contract documents were very specific again is the core pointed out to indicate that this is an open ended contract that there is no minimum quantity that there's no d guarantees that those amounts will be purchased that it may be more or less than that which is pretty interested let me just follow up eleven thing that makes it even stranger is you negotiate for the benefit of your members to cover rights if mitt american was unable to deliver the requirements the quantities that were indicated in the estimates your client had  right to sue and to cover at a higher price in mid american was obliged to cover that that differential correct under the bond that was posted that is correct and you made them get a bond to do that and then meanwhile on your own your  website you tell your cure your members your membership agreement say is members may not rely upon the estimated quantity submitted but instead all orders are subject to availability by the vendor at the time you orders are actually placed by the member that directly contradicts the cover it's the unit in this in this contract and the the contract documents themselves require that the contractor supply that amount and in fact at it when they sign your good they say they understand it they that they were acquired to provide the product and they are required to provide the product as needed  the members who have submitted estimates for those products so if and only if they choose to buy that's correct if they choose to buy because it's not we don't we d m c c p c does not satisfied the the price component of the agreement now they need to go negotiate quantity we can't control what those members do those members can as as has been pointed out go out to bid if it exceeds the threshold  talked about the seventeen thousand five hundred dollars that threshold is actually higher if you have a certified purchasing agent it goes up to forty thousand dollars secondly there are  a constituent members of the mars kind of co op may be members of other co ops because they are not precluded from participating in other co ops and they may well be a we don't have again we don't have control over that but the point of the system is to try to generate the lowest possible price for the tax payer that's how the system is set up this is because the system or general  then what happens if someone doesn't supply the estimated quantity if a supplier doesn't supply the estimated quantity until com they said that would be a breach except for the fact that it's waived is that is it your position that you're actually not doing anything f clients because you're giving them no right if someone doesn't supply the amount no no because if you didn't go she requirements contract where you have the right of return comes with that or or you have no right to redress or just doing something completely illusory but i think that the concept is that we can't as you as you are proffering it that we can't enforce the contract that's there and i think we disagree on that on that proposition that the bitter as illusory contract at all i think i think that we sat we accepted the bids the bids set forth the price at which the vendor is going to supply that product or that service example loose or even mid american has to have the benefit of the bargain what benefit did they get from this agreement the benefit that they got i see it up all i see is a slew of liabilities i think they got the opportunity to provide salt for over two hundred members and why did they need a piece of paper to say that why couldn't they have their sales agent make phone calls or pay visits to every one of the your constituents saying he would like to sell you some salt because of the local public contract law and the limitations that municipalities have where you get sued if it's under certain quantity there is no need to book and all that's true if it's on there are certain quantity that firing under certain dollar amount they have  able to go out and purchase without regard to committing however if it's a one thousand dollars home or they are required to get three points and pick the lowest quote they're not required to bid it in the same way that we bid but but  disproportionate to any stated estimate then the supplier has a claim well isn't it otherwise for reading estimates which are the most specific and detailed part of this big package we're reading the most specific and detailed part of a big package estimates and there's a cause of action well i think it's built upon the local public contract law and the ability to create the co operative pricing councils that these municipalities have created t every every every time you that there's a need for the able to go through the purchase order system which is really be contracts issue would be the purchase order the supplier of this hoffman american this situation here doesn't have to system could even sustain itself for any period of time because it just seems obvious and maybe i'm too cynical but it seems obvious that as soon as the asli go sheeted price is broadcast to the world every other salt supplier in the region knows what number they need to get underneath in order to get work well that might that might that not the case in fact like you know they did happen here right a lot of salt was allegedly sold at fifty eight a ton instead of sixty four i decided to purchase a saw it cheaper rate from their suppliers in amounts in excess of the statutory cap would you agree that's bad faith  if you're saying that you did in violation of the the the open public contract falls yeah it would be a violation the open public contract laws name is violation of outlaw bad faith per se almost like negligence per se you violated the statute that requires this that requires  conduct and if you did isn't that bad faith isn't that a statute tells you you have to do it this way you don't do it that way you might have good reasons to do it that way save the taxpayer money do all these other thing but you're in contravention of a statute the american it specifically says members of the m c c p c may purchase items for suit the concord issuance of purchase orders that's where the condition proceeded chris from that's where the contract arrives from say i asked your co counsel or co echoey counsel i guess are we supposed to cities are the most specific items in this entire big package we're supposed to ignore those to the us the missions i believe were in response was unexpected in a ton of the more they could buy them or they could sell in the secondary market at a profit they seem pretty obvious what was happening there so when we say something in a secondary market i'm not aware of any was a pal unit goes into the business of selling asphalt to a rd party or s snow and ice so that the taxpayers can utilize those roadways to get to where they need to do it so and i think that we have the nicht understand as your honour's brought up is that the  spending taxpayer money they can't commit wasted can't they can't purchase items that they don't need even if it was a requirement concept and not saying it all but if it was that would require them to purchase amount that necessary they do not need and commit waste of taxpayer funds so they can ignore the minimum bid specifications or new jersey statute if they can get a better deal otherwise i'm sorry i mean it be can you can word the bid specifications of the new jersey statute if minimum bid requirement seventeen thousand five hundred some instances forty thousand if they can get a cheaper deal without going through that process because that would save it half their money so principle is if we say the taxpayer money anything's go if so if someone so something because you see it because that price amounts it goes into bitter so sensitive if once that's announced to the world if entities if you use a power go without following that bid process to buy cheaper isn't that you miss the pallies already have enough salt to meet their needs at that point so because they give an estimate support so putting aside the issue of if they already had enough but if they go up to circumvent the statute then that's the question is that bad  contract and again that's the claim for the breach as well and the contract in the spreads on bigger was terms explains that quanties may be more or less than estimated you know minimum where requirements are allowed and the stated otherwise elsewhere and i think the other thing that we have to interpretation of a term where they had any acquired with any any of the the language in the contract before they submitted the bid they should have submitted a request for clarification and once they got that clarification a response and i will be very brief one of the reason we didn't ask them about the contract ahead of time is we thought it was requirements contract and that in unison power at ease in the townships by getting those estimates were going to buy i'm reasonably proportionate estimates are that this is the st time i'm hearing now that the townships and you miss the power of these don't have any duty under the contract until they did the purchase orders so we have and see c p c thing we don't have any duty and now they're saying we don't have any duty the contract contract doesn't doesn't say they have a duty right i mean i i'm struggling to find what benefit your client got the only the only thing i can sort of come up with is that it's almost a good housekeeping seal of approval your client is sort of broadcast to these two hundred entities that the it is the preferred or the recommended sol provider and i suppose if you're smallish or medium sized township there's some real virtue in not getting tied up in red tape and just issuing a purchase order so i'm it might make it more likely that these two hundred entities would choose to issue pos and do business with your client rather than reinventing the wheel and putting it out for three quotations etc is that not a benefit that your client got from this arrangement hundred and eleven five thousand times they actually collectability bought five thousand five hundred times and it wasn't like we just had the salt sitting around according to the contract we had to be ready willing and able to deliver it within like several days there that if we don't provide it within several days they have to go to the m c c p c and get permission to buy it from someone else so how why is that in there if they can go and buy it anyway from another provider you want to read the word that to mean because they didn't have to buy that quantity yes it stands to reason they had to buy some quantity yes the problem is we have no idea what they want to use and we know it's not of their requirements because the contract could have very simply said you