Opinion ID: 2823195
Heading Depth: 2
Heading Rank: 2

Heading: Standards for Conduct in Concession Bidding

Text: As noted above, the General Assembly is presumed to know the existing state of the law. Narragansett Food Services, Inc., 420 A.2d at 808. Before the competitive bidding statute was enacted by the Legislature, there was already a standard that was used by this Court when it reviewed bid disputes. In a case involving competitive bidding for a state-issued construction contract before § 45-55-5 was enacted, we observed that, “[i]n the absence of any legislative requirement pertaining to competitive bidding, it is the duty of the appropriate public officials to act honestly and in good faith as they determine which bidder would best serve the public interest.” Gilbane, 107 R.I. at 299-300, 267 A.2d at 399. There can be no dispute that this standard results in a certain amount of deference to government officials; indeed, we have held that this Court “will not interfere with [an] award absent a showing that the board acted corruptly or in bad faith, or so unreasonably or arbitrarily as to be guilty of a palpable abuse of discretion.” Paul Goldman, Inc. v. Burns, 109 R.I. 236, 239, 283 A.2d 673, 676 (1971) (citing Gilbane, 107 R.I. at 300, 267 A.2d at 399). Thus, although § 45-55-5 does not apply to competitive bidding processes involving concession contracts, which are contracts that produce revenue and not purchases, we conclude that, even in the absence of an applicable statute, the Gilbane standard must still apply. The defendants argue that this Court has not been presented with a reviewable issue because the town never completed the bidding process and never awarded the concession to any bidder. The defendants argue that because no such award exists, the propriety of the town’s conduct is unreachable by our review. We do not agree. We do not tread new ground in opining on the process of awarding, or not awarding, a competitive bid. See National Car Rental System, Inc. v. Fazzano, 112 R.I. 56, 58, 307 A.2d 770, 771 (1973) (car rental company brought action to -8- enjoin the awarding of a concession contract). In National, the Director of Transportation and the state’s purchasing agent advertised a bid to award three car rental concessions at T. F. Green Airport in Warwick. National, 112 R.I. at 57-58, 307 A.2d at 771. The bid stated that one of the three concessions was reserved for a “Rhode Island car rental company,” a condition to which National Car Rental, a national car rental company, objected. Id. at 58, 307 A.2d at 771. This Court reviewed and opined on the bidding process, despite the fact that National Car Rental brought the action during the time allotted for bid submission. Id. at 58-60, 307 A.2d at 771-73. In fact, the action in that case was brought on the day before bids were scheduled to be opened, when no award had been made. Id. at 58, 307 A.2d at 771. In our opinion, this case is in a proper posture for our review. As noted above, in her written decision the trial justice decided that the Gilbane standard did not apply and consequently she did not address whether the town acted “corruptly or in bad faith, or so unreasonably or so arbitrarily as to be guilty of a palpable abuse of discretion.” Gilbane, 107 R.I. at 399, 267 A.2d at 300 (citing Slocum v. City of Medford, 18 N.E.2d 1013, 1015 (Mass. 1939)). Because we disagree with the trial justice’s determination as to the applicability of the Gilbane standard, it follows that the case must be remanded to the trial justice for findings of fact and conclusions of law on that issue. 6 6 In remanding this case we remain cognizant of our earlier holdings that the bar for a potential challenger is extremely high. Corruption, bad faith, and a palpable abuse of discretion are difficult to prove, particularly in the light of our antipathy for “government by injunction.” See, e.g., Truk Away of Rhode Island, Inc. v. Macera Brothers of Cranston, Inc., 643 A.2d 811, 816 (R.I. 1994). -9- IV