Opinion ID: 1966598
Heading Depth: 1
Heading Rank: 4

Heading: Immature Versus Mature Administrative Fees

Text: The first issue dealt with in the trial justice's decision was what she perceived as the State's modification of the RFP after bids had been submitted and without notice to Blue Cross. Specifically, the RFP required the parties to submit a quote for immature fees for 2005, and mature fees for 2006 and 2007. Under the then-current contract with the State, Blue Cross was responsible for all claims pending, but not yet paid, as of January 1, 2005. Therefore, the companies bidding on the new contract were asked to deduct these fees from their total quote for the year. This number is called an immature quote. A mature quote was then requested for 2006 and 2007, during which years the new contract would presumably cover all claims filed. Blue Cross complied and also included a mature quote for 2005 for illustrative purposes only. According to the trial justice, United submitted only mature quotes for all three years. Rather than finding United's quote to be nonresponsive, and without notice to Blue Cross, Hewitt and the State compared the mature quote provided by Blue Cross for 2005 to the only quote supplied by United. The trial justice concluded that (1) United's bid was seemingly nonresponsive due to this error and (2) that the State's decision to compare mature quotes constituted an effort to protect United from possible disadvantage after it had submitted a seemingly non-responsive bid. The State claims that United had, in fact, submitted an immature bid for 2005 but Hewitt mistakenly compared it to the mature bid submitted by Blue Cross. United agrees that confusion surrounded the issue of mature and immature fees, but insists that it was Blue Cross that was confused. According to United, the RFP took into consideration that when the three-year contract expired at the end of 2007, the insurance provider selected would be responsible for paying run-out claims just as Blue Cross is required to pay run-in claims that extend into 2005. What exactly the State intended when it issued follow-up questions asking the parties to confirm whether administrative fees quoted are mature or immature  to which United replied mature  is a question of fact that we do not reach. We are required to accept the trial justice's findings as true absent a showing that [she] overlooked or misconceived material evidence or was otherwise clearly wrong. Fleet National Bank v. 175 Post Road, LLC, 851 A.2d 267, 273 (R.I.2004) (quoting Casco Indemnity Co. v. O'Connor, 755 A.2d 779, 782 (R.I.2000)). Upon careful review of the record, we conclude that the trial justice did not overlook or misconceive material evidence, and thus we adopt her findings on this issue and proceed on the basis that United submitted a mature quote contrary to what was requested. Notwithstanding the State's decision to compare mature fees after it requested that immature quotes be submitted for 2005, we hold, as a matter of law, that such an error did not rise to the level of palpable abuse of discretion. In H.V. Collins Co., 696 A.2d at 300, the trial justice held that Gilbanes bid was materially nonresponsive, fatally defective, and should have been rejected by the school committee. The rationale given by the trial justice in this case is strikingly similar. She determined that the States conduct in modifying the RFP, without notice to [Blue Cross], was a palpable abuse of discretion. We reversed the Superior Court's decision in H.V. Collins Co., concluding that [g]iven the overall comprehensiveness of Gilbane's bid and the absence of any evidence that the school committee acted in a corrupt manner or in bad faith,    the committee did not err in its evaluation of the Gilbane bid   . Id. at 305 (emphasis added). Here, too, the trial justice failed to consider the overall comprehensiveness of United's bid as our opinion in H.V. Collins Co. requires. We deem this error. The RFP was very long and complicated. Naturally, strict compliance with the requirements set forth in the RFP would have been preferable; however, the awarding authority decided to overlook this shortcoming and, instead, for the sake of determining what was more beneficial for the State, chose to compare the mature quotes that had been supplied by the only two bidders. In the absence of bad faith or corruption, a finding of palpable abuse of discretion should be approached with grave caution and be based upon much more compelling evidence of arbitrariness or capriciousness than may be found in mere complexity. Truk Away, 643 A.2d at 816.