No. 83-254 

IN THE SUPREME COURT OF THE STATE OF XONTANA 

1983 

MARTEL COL\ISTRUCTION, I?JC. , AND WILLIAM MARTEL, 

Plaintiffs and Responden$s, 

MONTANA STATE BOARD OF EXAMINERS, GOVERNOR 

TED SCHWII\JDEP.J, SECRETARY OF STATE JIM F?ALTElV4IRE, 

AJSD ATTORNEY GENERAL MICHAEL T. GREELY, as members 

thereof, and MORRIS BRUSETT, Director of the Dept. 

of Administration, 

Defendants and Appellants, 

and 

VOLK CONSTRUCTIONl INC. , 

Intervenor and Appellant. 

APPEAL FXOI'I: District Court of the First Judicial District, 

In and for the County of Lewis & Clark, 

The Honorable Henry Loble, Judge presiding. 

COUNSEL OF RECORD: 

For Appellants: 

Hon. Mike Greely, Attorney General, Helena, Montana 

Valencia Lane, Dept. of Administration, Helena, Montana 

Alexander C Baucus, Great Falls, Montana 

For Respondents: 

Scully, Lilly & Andriolo, Bozeman, Montana 

For Amicus Curiae: 

Tom Johnson, Helena, Montana (Montana Contractars) 

Anderson, Brown, Gerbase, Cebull & Jones, Billings, 

Iblontana (Billings Contrators' Council) 

-- ---- ---- Submitted on Briefs: June 30, 1983 

Decided: August 12, 1983 
Mr. Justice John C. Sheehy delivered the Opinion of the 

Court. 

The members of the State Board of Examiners, the 

director of the state Department of Administration, and Volk 

Construction, Inc., appeal from an order of the District 

Court, First Judicial District, Lewis and Clark County, 

granting a writ of mandamus to compel the Montana Board of 

Examiners to reject the bid of Volk Construction, as 

unresponsive to the solicitation for bids for the Montana 

Children's Treatment Unit Project. 

We reverse the District Court and quash the writs of 

mandamus and certiorari. 

Martel Construction, Inc., a Montana corporation, is a 

regularly licensed contractor with its office in Bozeman, 

Montana. William Martel is an officer of Martel. Volk 

Construction, Inc., a Montana corporation, is also a 

regularly licensed contractor with its office in Great Falls, 

Montana. 

Governor Ted Schwinden, Secretary of State Jim 

Waltermire, and Attorney General Mike Greely comprise the 

Montana State Board of Examiners. Morris Brusett is the 

director of the state Department of Administration. These 

appellants will be referred to hereafter as "the state 

officers." Collectively they are responsible for, among 

other things, the solicitation of competitive bids for public 

works, determining successful bidders and awarding contracts 

for such works. 

In late 1982, the state officers issued a solicitation 

for competitive bids for the construction of the Montana 

Children's Treatment Unit to be built in Billings, Montana. 
The bid opening was to be held on February 9, 1983. Prior to 

the bid opening date, the solicitation for bids was amended 

by the state officers by addendum 1, dated January 18, 1983, 

addendum 2, dated February 2, 1983, and addendum 3, dated 

February 4, 1983. 

The solicitation for bids contained a section entitled 

"Instructions to Bidders," which provided in Section E, 

Proposals, paragraph 2 as follows: 

"2. Proposals shall be in a sealed envelope and 

addressed to: 

"Department of Administration & Board of Examiners 

State of Montana. 

Architecture & Engineering Division, 1500 East 

Sixth Avenue, Helena, Montana 59620. 

"The envelope shall also contain the following 

information: 

"Name of Project 

Mont A/E Number 

Name of Contractor 

Montana Public Contractor's License No. 

Acknowledge receipt of Addendum No. 11 

"'* 

(Emphasis added.) 

Paragraph E.3 provides: 

"3. Proposals entitled to consideration shall be 

made in accordance with the following instructions: 

"a. made upon form provided, 

"b. all blank spaces properly filled, 

"c. all numbers stated in both writing and in 

figures, 

"d. shall contain no additions, conditional or 

alternate bids, erasures, or other irregularities. 

"e. shall acknowledge receipt of all addenda 

issued. " (Emphasis added. ) 

The work to be performed under the original bid 

solicitation was substantially increased by the requirements 

of addenda 2 and 3. These changes resulted in a material 

increase in the cost of the work of approximately $55,280, 
which would not have been required under the original 

solicitation. 

The bid form had on it a place for the acknowledgment of 

each addendum, with the date of each addendum. The bid 

submitted by Volk failed to acknowledge, on the envelope or 

on the bid form, receipt of addenda 2 and 3 as required by 

the "Instructions to Bidders." 

When bids were opened on February 9, 1983, Volk had the 

low general contractor's bid of $1,698,000. The next bid, 

for the same options, was $174,600 higher. That bid was 

submitted by Martel. 

Because addendum 3 was sent late, that is, close to the 

February opening date, the architect employed by the state 

for this project telephoned each contractor on February 8, 

1983, to confirm that each was aware of addendum 3. 

Martel protested Volk's bid. The architect again got in 

touch with Volk to inquire whether Volk received addenda nos. 

2 and 3 and reported, "I was assured that Volk received and 

considered all addenda." 

The Board of Examiners first considered Martel's bid 

protest at its regular meeting on February 22, 1983. Since 

all bids exceeded the appropriation ava.ilable, the Board 

decided to approach the Legislature for supplemental funding 

before making any decision. Subsequently, the 1983 Montana 

Legislature approved. an additional $350,000 for the Montana 

Children's Treatment Unit. There was still only enough money 

to award the general contract to Volk. The other bidders had 

submitted bids which would not meet the available monies even 

after the 1983 supplemental appropriation. 

The Board of Examiners met a second time on March 24, 

1983, to consider Martel's bid protest. Martel and his 
attorney urged the Board to reject Volk's bid as unresponsive 

and threatened suit if the Board did not do so. The Attorney 

General noted that there had been a prior oral acknowledgment 

by Volk of the addenda and that Volk would be bound to a 

contract, and that in his opinion Volk had no advantage over 

other bidders. Nevertheless, the Board postponed its 

decision to allow for more research. 

The Board met a third time on April 5, 1983. All 

parties were present. Volk and his attorney addressed the 

Board, and exhibited worksheets which Volk claimed showed 

addenda 2 and 3 were used in preparing his bid. Again the 

Board adjourned to allow for more research. 

In the meantime, the Board of Examiners received 

memoranda from its counsel advising them not to accept Volk's 

bid and to set out the project for rebidding. Nevertheless, 

the Board met for a fourth time on April 7, 1983. They 

concluded that Volk was aware of addenda 2 and 3, could be 

bound to a contract including all the addenda, and that the 

contract should be a.warded to Volk as the lowest bidder. 

Martel commenced an action for writ of review, writ of 

mandate, or other appropriate writ in the District Court, 

First Judicial District, Lewis and Clark County, for the 

purpose of contesting the action of the Board of Examiners in 

accepting Volk's bid. After hearing and argument the 

District Court entered findings of fact, conclusions of law, 

and issued an order providing for a writ of mandamus to 

compel the Board of Examiners to reject Volk's bid as 

unresponsive to the specifications for the Montana Children's 

Treatment Unit Project. The state officers and Volk have 

appealed that decision to this Court. We have had the 

benefit of briefs from the Montana. Contractor's Association, 
Inc., and Billings Contractors Council, Inc., as amici 

curiae, each in support of Martel1s position in this case. 

The state officers and Volk raise four issues on appeal: 

1. Does Martel, an unsuccessful bidder, have standing 

to procure mandamus? 

2. Does certiorari lie in this case? 

3. Can certiorari be considered in this case as 

ancillary to a writ of mandamus? 

4. Does mandamus lie in this case? 

IS MANDAMUS APPROPRIATE? 

We will first discuss the last issue raised by the state 

officers. The District Court determined that a writ of 

mandamus should issue because the District Court found that 

Volkls bid was not responsive to the bid solicitation. 

The statutory authority for the state officers to act in 

this cause is found in section 18-2-103(1) (c) as follows: 

" (1) For the construction of a building costing 

more than $25,000 the department of administration 

shall: 

"(c) under the supervision and with the approval of 

the board of examiners, solicit, accept, and reject 

bids and award all contracts to the lowest 

qualified bidder considering conformity with 

specifications and terms and reasonableness of bid 

amount;. . ." 

In considering the legal effect of those statutory 

provisions, the District Court determined that the duty of 

the state officers to award the contract to the "lowest 

qualified bidder" gave the state officers discretion to 

determine whether the bidder was responsible, so interpreting 

Koich v. Cvar (1941), 111 Mont. 463, 110 ~.2d 964. The 

District Court further determined that the statutory language 

requiring the state officers to consider conformity with 
specifications and terms and reasonableness of bid amount 

meant a determination as to the responsiveness of the bidder 

to the bid itself. The District Court concluded that the 

Board of Examiners in determining "conformity with 

specifications" was determining responsiveness to the bid, 

which was ministerial in nature. The District Court relied 

on State ex rel. Lee v. Montana Livestock Sanitary Board 

(1959), 135 Mont. 202, 206, 339 P.2d 487, 490, defining a 

ministerial act as follows: 

"A ministerial act may perhaps be defined to be one 

which a person performs in a given state of facts, 

in a prescribed manner, in obedience to the mandate 

of legal authority, without regard to or the 

exercise of his own judgment upon the propriety of 

the act done." 

Having concluded that in determining responsiveness the 

Board of Examiners was performing only a ministerial duty, 

the District Court then concluded that mandamus would lie. 

State ex rel. Brink v. McCracken (1931), 91 Mont. 157, 6 P.2d 

The briefs of amici in support of the District Court 

emphasized the importance of protecting the competitive 

bidding process for the construction of public works. They 

contend that in this case Volk, after the bid opening, knew 

that it had the lowest bid, because he could disclaim 

knowledge of the addenda, and could accept or reject the 

contract, that thus Volk in effect was qiven, to use Martel's 

expression, "two bites at the apple." 

Amici fea.r that the integrity of the bidding process is 

endangered by recognition of oral acknowledgments of addenda 

because (1) there is then no assurance that there is a clear 

meeting-of-the-minds between the public body calling for the 

bids and the low bidder; (2) there is then no assurance that 
all bidders are bidding on the same thing, and (3) that the 

action of the State Board of Examiners opens the door to the 

nightmare of oral acceptances if it gives Volk the benefit of 

its bid under its oral acknowledgment of addenda 2 and 3. 

The state officers, in opposition, contend that Volk was 

bound to perform all of the addenda under its bid because 

Volk was aware of and considered the addenda in making its 

bid. The state points to the fact Volk had obtained a 

supplier's written price bid for material required only on 

addenda 2; and that the architect had called Volk on February 

8, 1983, to discuss the addenda. The state officers rely on 

Boger Contracting Corp. v. Board of Commissioners of Stark 

County (Ohio App. 1978), 396 N.E.2d 1059, for authority that 

it could separately determine whether Volk could be bound, 

and whether Volk had actual knowledge of the addenda. 

The District Court opted to follow the holding of the 

Comptroller General of the United States in Matter of MET 

Electrical Testing, Inc., B-201146 (March 17, 1981). 

Therein, the Comptroller rejected MET Electrical's bid as 

nonresponsive for failure to acknowledge a material addendum. 

The Comptroller General held: 

"Permitting oral acknowledgment of a material 

amendment is detrimental to the competitive bidding 

process in two ways. First, it allows a bidder 

'two bites at the apple' by giving it the sole 

discretion to accept or reject the contract after 

bid opening, by affirming or denying that it 

intended to be bound by the amendment, and hence, 

the agreement. See National Investigation Bureau, 

Inc. B-191759 (July 18, 1978), 78-2 CPD 44. 

Second, because of the bidder's failure to timely 

acknowledge the amendment in writing, the terms of 

the resulting contract are not clear since the 

written bid acknowledges the terms of the 

solicitation but not relevant amendments, 42 Comp. 

Gen., supra. 

"Under these circumstances, we believe MET'S bid 

was properly rejected as nonresponsive for failure 
to timely acknowledge a material amendment in 

writing." 

The District Court also noted the holding in Charles N. 

White Construction Co., Inc. v. The Department of Labor 

(N.D. Miss. 1979), 476 F.Supp. 862, where the Federal 

District Court denied injunctive relief against the 

Comptroller General because he had rejected a bid where the 

bidder had not made written acknowledgment of all addenda, 

but a representative of the company did orally acknowledge 

receipt of such addenda. The thrust of the holding in White, 

however, was that the Comptroller General denied the bidder 

protest because there was no independent evidence, aside from 

the bidder, that he had received the addenda and considered 

the same in making his bid. The facts of that case differ 

from this case. The record here shows that Volk confirmed 

the receipt of the addenda through telephone conversation 

with the architect having charge of the project, and shows 

that his bids had included material prices which could have 

only come from consideration of the addenda. 

The decision of the Federal District Court in White was 

governed by the agency's procurement regulations, which 

provided that "after bids have been opened, award must be 

made to that responsible bidder who submitted the lowest 

responsive bid." 41 C.F.R., 1-2.404-1(a), (1978). A 

further regulation provides that " [a] ny bid which fails to 

conform to the essential requirements of the invitation for 

bids, such as specifications, delivery schedule, or 

permissible alternates thereto shall be rejected as 

nonresponsive." 41 C .F .R. , section 1-2.404-2 (a) , (1978) . 

It will be noted that there is a difference, though 

perhaps not material, between the state statute governing the 
state officers in this case, and the federal regulations 

governing the Comptroller General in the cases he had 

decided. 

The fulcrum on which the decision here of the District 

Court is balanced is its determination that whether Volk's 

bid was responsive is ministerial only, and not an exercise 

of discretion by the state officers. It is essentially on 

this point that we disagree with the District Court. The 

state statute empowers the state officers to "award all 

contracts to the lowest qualified bidder considering 

conformity with specifications and terms . . . " It is our 

holding that the state officers, in determining whether 

bidders are qualified, and whether they will perform the 

contract in conformity with the specifications and terms of 

the solicitation are acting in a discretionary manner. It 

goes without citation to say that mandamus does not lie to 

control the discretion of public officers. 

We regard the concerns in this case of amici with a good 

deal of respect. We agree that the bidding process for 

public contracts should be impartial, with equal opportunity 

given to all those participating in the public bidding, to 

avoid corruption, and that the process should at the same 

time procure for the state quality materials and workmanship 

for the most reasonable cost. We, therefore, look to the 

facts of this case to determine (1) whether there was a 

meeting of minds between the state and Volk under its bid, 

and (2) whether Volk could be held by the state to perform 

all of the addenda under its bid. 

The evidence that Volk was contacted by telephone 

regarding the last two addenda and that Volk had begun 

preparation for fulfilling the obligations of addenda nos. 2 
and 3, is adequate to show that Volk had actual knowledge of 

the addenda and that there was a meeting of the minds as to 

their existence and the respective requirements for 

fulfillment of the terms of those addenda. 

Pertinent to the examination of whether Volk could be 

held by the state to perform the addenda is other language in 

the solicitation for bids. 

Paragraph H.5 of the solicitation provided: 

"A1 l written addenda issued by the 

Architect/Engineer will become part of the Contract 

Documents and all Bidders shall be bound by such 

addenda, whether received or not by the Bidder. No 

oral or telephonic modifications of the Contract 

Documents will be considered." 

Again, Paragraph 1.2 of the solicitation for bids 

provided : 

"2. The Owner reserves the right to reject all bids 

and to waive any informality or irregularity in any 

bid received." 

These provisions of the solicitation for bids issued by 

the state officers make it clear that a bidder could not get 

"two bites at the apple," and decide to reject a bid if 

pleased, because the language of this solicitation binds the 

bidder to full performance of the contract documents, 

including all of the addenda, received by the bidder or not. 

In making its bid, Volk agreed to that provision. Both 

Martel and Volk and all other bidders agreed that the state 

had the right to reject all bids or to waive any informality 

or irregularity in any bid received. 

Thus, Volk, in submitting the bid here by the contract 

documents, bound itself to the full performance of the 

contract documents, including the addenda. 
Moreover, we hold that the state officers properly have 

the power to waive irregularities in any bid offered. The 

state officers reserved that right in the solicitation for 

bids, and properly have that right in awarding public 

contracts. Of course, such waiver should only apply if the 

irregularity is immaterial. We hold the failure of Volk to 

make written acknowledgment of receipt of addenda in this 

case is immaterial for this principal reason: The changes in 

work required by addendum 2, amounted to approximately 

$37,355, and those by addendum 3 to approximately $17,925, 

for a total combined cost increase resulting from addenda 2 

and 3 of $55,280. This amount is less than the spread 

between the first and second bidder, which was $174,000. If 

the spread in this case between the lowest and the second 

lowest bidder had been less than $55,280, so as to affect the 

bidding, then the failure of Volk to acknowledge receipt of 

the addenda in written form, would have changed from an 

immaterial to a material defect, an irregularity that the 

state officers could not then waive. See Charles - N. White 

Construction Co., supra, 476 F.Supp. at 867. 

Deviations in bid submissions which do not go to the 

substance of the bid (here Volk acknowledges his full 

responsiblity for the addenda as well as the contract), and 

irregularities which do not give one bidder a substantial 

advantage over other bidders, are types of irregularities 

that can be waived by public officers in awarding contracts. 

A.A.B. Electric, Inc. v. Stevenson Public School District 

(Wash. App. 1971), 491 P.2d 684; Prestex, Inc. v. United 

States (Ct. C1. 1963), 320 F.2d 367, 372. 
We, therefore, determine that in this case mandamus 

interferes with the discretion of the state officers in 

awarding the contract to the qualified bidder conforming to 

specifications and terms of the bid solicitation, and in 

considering the reasonableness of the amount bid. Our 

determination in effect disposes of all of the other issues 

in the case, because each other issue rises or falls with our 

determination of the right to mandamus here. 

We have expedited our decision on this appeal, because 

of the importance of the question presented, and because the 

fate of the construction project is hanging in the balance. 

We reverse the District Court, quash any writ of mandamus and 

certiorari issued in this cause and order that the 

proceedings be dismissed in the District Court on remittitur. 

Let remittitur issue forthwith. 
/ Justices 

,/