Title: Asphalt Surfacing v. SD DEPT. OF TRANSP.

State: south-dakota

Issuer: South Dakota Supreme Court

Document:

385 N.W.2d 115 (1986) ASPHALT SURFACING COMPANY, Plaintiffs and Appellants, v. SOUTH DAKOTA DEPARTMENT OF TRANSPORTATION; the South Dakota Transportation Commission; James R. Myers, Secretary of the South Dakota Department of Transportation; Roger Bernard, Robert Appelwick, James Rothstein, D. William Hustead, Herman I. Lerdal and Richard Helsper, Commissioners of the South Dakota Department of Transportation; and Vern Larson, South Dakota State Auditor, and Batzer Construction Co., A Foreign Corporation, Defendants and Appellees. No. 15026. Supreme Court of South Dakota. Considered on Briefs February 12, 1986. Decided April 9, 1986. *116 James E. McMahon, of Boyce, Murphy, McDowell & Greenfield, Sioux Falls, for plaintiffs and appellants. Camron Hoseck, Asst. Atty. Gen., for defendants-appellees except Batzer Const. Co., Mark V. Meierhenry, Atty. Gen., Pierre, on brief. T. Michael Carter, of Maher, Carter & Bode, Pierre, and F. Patrick McGrath, St. Paul, Minn., for defendant-respondent Batzer Const. Co. FOSHEIM, Chief Justice. Asphalt Surfacing Company (Plaintiff) sought a declaratory judgment and injunction relief when they were not awarded three road improvement contracts with the South Dakota Department of Transportation (DOT). The trial court ruled against Plaintiff and denied the injunctions. We affirm. In April of 1985, DOT held a bid letting for three projects. Plaintiff was the apparent low bidder but the DOT Commission determined that South Dakota Constitution article III, section 12, prohibited awarding the contract to Plaintiff. This section provides: The resurfacing contracts have since been awarded to another company. Both parties request, however, that the issue, although moot, be determined. We find the public interest exception to the general rule against deciding moot issues applicable. A contemporary precedent interpreting this constitutional section will control other State contracts. A reoccurrence is likely and will suffer the same mootness problem before this court may render a decision. In re Application of Northwestern Bell Telephone Co., 326 N.W.2d 100, 102-03 (S.D.1982). The key issue presented is whether article III, section 12 of the South Dakota Constitution prohibits the State from awarding a contract for highway repair to a company because its president was a legislator at the time the general appropriation bill covering the repair funds was passed. This issue may be divided into subparts: (1) whether passage of a general appropriation bill is the type of authorization contemplated by the constitutional provision, and (2) whether the constitutional provision applies to contracts awarded to the lowest bidder. We answer both in the affirmative. This court has strictly interpreted article III, section 12. Palmer v. State, 11 S.D. 78, 75 N.W. 818 (1898); Norbeck & Nicholson Co. v. State (I), 32 S.D. 189, 142 N.W. 847 (1913); and Norbeck & Nicholson Co. v. State (II), 33 S.D. 21, 144 N.W. 658 (1913). In Palmer, the court said: Palmer, 11 S.D. at 80-81, 75 N.W. at 819. A casual reading of State ex rel. Grigsby v. Ostroot, 75 S.D. 319, 64 N.W.2d 62 (1954), perhaps indicates that the passing of years has mollified this court. Not so. In Ostroot, an original proceeding was begun to determine whether a candidate for gubernatorial nomination was eligible for election to that office since he had voted, as a member of the legislature, to increase the salary for the position he sought. The court decided per curiam that a 1946 amendment to article XXI, section 2, addressing constitutional officer's salaries, was obviously not intended to be overridden or defeated by the older constitutional provision and the State legislator was deemed eligible. The court said: Id. at 327-28, 64 N.W.2d at 66. In other words, a specific constitutional amendment relating to salaries, rather than a relenting court, was the controlling factor in Ostroot. We accordingly adhere to our interpretation of article III, section 12, presented in Palmer and both Norbeck decisions. Article III, section 12 specifically prohibits a contract with the State if "authorized by any law" during the legislator's term. (Emphasis added.) Our constitutional framers obviously intended a broad prohibition. Palmer, 11 S.D. at 80-81, 75 N.W. at 819. This leaves little question that section 12 applies to a general appropriation bill as well as more specific legislative decisions. For the same reason, we likewise find no merit in Plaintiff's argument that the constitutional provision is not applicable to contracts awarded on the basis of the lowest submitted bid. Article III, section 12 makes no such exception. Accordingly, any apparent legislative attempt to circumvent the plain meaning of the Constitution by statute, SDCL § 5-23-14,[1] must perish. It does not follow, however, that SDCL § 5-23-14 is declared unconstitutional. Since we can construe the statute to be constitutional, we must do so. Frawley Ranches, Inc. v. Lasher, 270 N.W.2d 366, 369 (S.D.1978). While the statute clearly cannot obviate article III, section 12 of the Constitution, it does have a limited application. The Constitution prohibits State contracts with a legislator, during or within one year of his term, which were authorized during the term. The statute takes this constraint one step further and states that contracts with legislators, valid under article III, section 12 of the Constitution, may only be awarded if the legislator is the lowest responsible bidder. Construing these enactments together, a present legislator may benefit from a contract with the State if the contract was not authorized during his term and he is the lowest responsible bidder. A former legislator, less than one year out of office, may benefit from a State contract if it was not authorized during his elected term. If a legislator has been out of office more than one year, neither the constitutional provision nor statute prohibit his contracting with the State. The decision of the trial court is affirmed. MORGAN, J., and HERTZ, Circuit Judge acting as a Supreme Court Justice, concur. HENDERSON, J., concurs with a writing. WUEST, J., disqualified. SABERS, J., not having been a member of the Court at the time this action was submitted to the Court, did not participate. HENDERSON, Justice (concurring). For posterity, for synthesis of my vote, for elaboration of facts to sustain the justification of my vote, some observations: [1] SDCL § 5-23-14 (prior to 1985 amendment): No contract shall be awarded to any officer or employee of the state, nor shall any part of any contract be awarded to any firm, association, or corporation, in which any state officer or employee shall be interested, either directly or indirectly, and any contract made in violation of the provisions of this chapter shall be absolutely void; provided, however, that the provisions of this section shall not apply to such notaries public nor to such other state officers or employees serving on boards or commissions, who are not drawing a salary from the state. The provisions of this section shall also not apply to a member of the state Legislature when such person is the lowest responsible bidder in accordance with the provisions of chapter 5-18 if such contract award is not in violation of the provisios of section 12 of Article III of the state Constitution. Any officer or employee of this state who knowingly violates this section is guilty of a Class 2 misdemeanor.