Court Opinion

ID: 7845812
Source: CourtListenerOpinion
Date Created: 2022-09-08 17:10:17.168749+00
Date Added: 2024-06-11T16:21:12.934872
License: Public Domain

BERDON, J.,
dissenting. This case involves an important public policy consideration — whether a municipality should be subject to liability for damages because it rejected the bid of the lowest qualified bidder in violation of the town code that requires the town to award contracts to such a bidder. “Such requirements [of competitive bidding] as are contained in the [code] in question are for the purpose of inviting competition, *417to guard against favoritism, improvidence, extravagance, fraud and corruption in the awarding of municipal contracts, and to secure the best work or supplies at the lowest price practicable, and are enacted for the benefit of property holders and taxpayers, and not for the benefit or enrichment of bidders, and should be so construed and administered as to accomplish such purpose fairly and reasonably with sole reference to the public interest. 10 McQuillin, Municipal Corporations (3d Ed.) § 29.29.” (Internal quotation marks omitted.) Austin v. Housing Authority, 143 Conn. 338, 345, 122 A.2d 399 (1956). The question, therefore, is how to best protect those interests. I would hold that the public interest can best be vindicated by allowing the lowest qualified bidder who has not been awarded the contract to seek damages.
In the present case, the plaintiff, Lawrence Brunoli, Inc., alleges that the defendant, the town of Branford, had informed the plaintiff that it was the “lowest qualified bidder” for the construction project in question, but did not award the contract to the plaintiff because it apparently failed to attend a prebid conference. The plaintiff, however, alleges in its complaint that the defendant’s invitation to bid did not specify that the prebid conference was a requirement and, alternatively, that if it did, it waived any such requirement.1 According to the plaintiff, the defendant engaged in favoritism when it awarded the contract to the second lowest bidder, whose bid was $344,000 higher than the plaintiffs, in violation of § 75-2 of the Branford code.2 The plaintiff brought the present action for money damages *418that it allegedly suffered as a result of this violation. The defendant’s motion to dismiss the complaint for lack of subject matter jurisdiction was granted and the plaintiff appealed.
On the basis of the plaintiffs allegations, I recognize that the taxpayers of the defendant already have been penalized in the amount of $344,000 as a result of the defendant’s refusal to accept the plaintiffs low bid. According to the majority opinion, the public, through the defendant, should not be penalized further by having to pay monetary damages, notwithstanding any potential fraud, favoritism or corruption. Similarly, other jurisdictions that have prohibited monetary damages have done so in reliance on the same two theories that the majority espouses: (1) that the competitive bidding laws were designed to protect the government and not the individual bidders; and (2) that the treasury has already been injured by paying too high a price for the goods and service. Annot., 65 A.L.R.4th 93, 99 (1988). Additionally, the majority asserts that the availability of monetary damages would create excessive litigation and cause uncertainty for the municipal government with respect to the costs of the project. Such claims are not only unconvincing, but also ignore the problem of the lack of incentive for the private sector to keep government honest and the reality that costs of such projects are typically elastic.
In my view, the assessment of monetary damages against the defendant would best serve the public interests at stake. I agree with those jurisdictions that have determined that “[a]n award of money damages would be in the public interest because it would deter such misconduct by public entities in the future.” Marbucco Corp. v. Manchester, 137 N.H. 629, 633, 632 A.2d 522 (1993); see also Swinerton & Walberg Co. v. Inglewood Los Angeles County Civic Center Authority, 40 Cal. App. 3d 98, 105, 114 Cal. Rptr. 834 (1974). As the plaintiff *419asserts, the spector of public discontent at paying monetary damages is more likely to deter any potential official misconduct than if only injunctive relief is at stake. Moreover, such a deterrent would encourage more bidders, which would increase competition and thereby lower costs to the taxpayers. See Owen of Georgia, Inc. v. Shelby County, 648 F.2d 1084, 1095 (6th Cir. 1981) (applying Tennessee law, “it is doubtful that many contractors would bid at all knowing the deck was stacked against them”). Lastly, awarding monetary damages would also compensate the plaintiff for its justifiable reliance upon the municipal code.
It is true, as the majority points out, that we have thus far recognized that in certain circumstances the lowest bidder has standing to bring an action for an injunction. See, e.g., Spiniello Construction Co. v. Manchester, 189 Conn. 539, 544, 456 A.2d 1199 (1983). Nevertheless, the majority is unable to cite to any case wherein we have, on a contractual theory, rejected a cause of action for damages. The majority merely states that since there was no contract between the plaintiff and the defendant, there is no cause of action for damages. This simplistic answer, however, does not address the plaintiffs claim.
The law of contract does not necessarily start with an offer and end with the acceptance of that offer, for we have always recognized that variations are often required in order to do justice. In this matter, the plaintiff reasonably relied on the defendant’s promise that if there was to be an award, the bid would be awarded to the lowest qualified bidder. Indeed, this promise is embodied in § 75-2 (A) (1) of the Branford code, which provides that “all work or materials and supplies furnished to and purchased by the town . . . shall be awarded after advertising ... to the lowest responsible bidder . . . .” (Emphasis added.)
*420This court has long recognized that a “promise which the promisor should reasonably expect to induce action ... on the part of the promisee . . . and which does induce such action ... is binding if injustice can be avoided only by enforcement of the promise.” (Internal quotation marks omitted.) D’Ulisse-Cupo v. Board of Directors of Notre Dame High School, 202 Conn. 206, 213, 520 A.2d 217 (1987), quoting 1 Restatement (Second), Contracts § 90 (1973); Sheets v. Teddy’s Frosted Foods, Inc., 179 Conn. 471, 475, 427 A.2d 385 (1980). When government officials fail to award a contract to the lowest qualified bidder in violation of a code, ordinance or statute, “injustice to [the low bidder], the promisee, can be avoided only by at least the partial enforcement of the [government’s] promise .... [Furthermore, t]o hold that [the low bidder] was not entitled to rely upon this promise . . . would make the [government’s] promise an illusory one and render the whole competitive bidding process nugatory.” Swinerton & Walberg Co. v. Inglewood-Los Angeles County Civic Center Authority, supra, 40 Cal. App. 3d 104. Such reasoning has encouraged other jurisdictions to award damages to low bidders who have claimed damages directly attributable to their reliance on a low bidder statute. See, e.g., Owen of Georgia, Inc. v. Shelby County, supra, 648 F.2d 1094-96; Swinerton & Walberg Co. v. Inglewood-Los Angeles County Civic Center Authority, supra, 103-105; Marbucco Corp. v. Manchester, supra, 137 N.H. 633-34. Similarly, I would hold that, based upon the contractual theory of promissory estoppel, the plaintiff has alleged a cause of action for money damages over which the court has jurisdiction. Therefore, the trial court should not have dismissed the action.
The measure of damages with respect to an action predicated on promissory estoppel “may be limited as *421justice requires.” 1 Restatement (Second), Contracts § 90 (1981). I would adopt the New Hampshire approach as follows: “In the ordinary case, the damages that an unsuccessful low bidder may recover should be limited to those it sustained directly by reason of its justifiable reliance upon the municipality’s promise to award the contract to the lowest responsible bidder submitting all essential information prior to the bidding deadline, if it awarded it at all. Hence, damages ordinarily should be limited to the expenses incurred by the lowest bidder in its fruitless participation in the competitive bidding process, i.e., its bid preparation costs.3 See Paul Sardella Construction Co. v. Braintree Housing Authority, 371 Mass. 235, 243, 356 N.E.2d 249,254 (1976). To permit the recovery of greater damages in such cases could drain the public fisc in response to mere carelessness on the part of low level government officials. If a disappointed low bidder complies with all requirements of the bid instructions but is deprived of the contract through some conduct of the awarding authority tantamount to bad faith, however, then the recovery of lost profits should be the measure of damages. See [.Peabody Construction Co. v. Boston, 28 Mass. App. 100, 105-106, 546 N.E.2d 898 (1989)]. The greater deterrence resulting from an entitlement to lost profits is justified when bad faith is proven because a municipality’s bad faith undermines the purpose of competitive bidding. . . . [P]ublic confidence in government is eroded when municipal officials act in bad faith.” (Citation omitted; internal quotation marks omitted.) Marbucco Corp. v. Manchester, supra, 137 N.H. 634.
I dissent.

 ‘'Since the motion to dismiss filed by the [defendant] does not seek to introduce facts outside of the record it . . . admits all well pleaded facts, the complaint being construed most favorably to the plaintiff.” (Internal quotation marks omitted.) Duguay v. Hopkins, 191 Conn. 222, 227, 464 A.2d 45 (1983).

 See footnote 3 of the majority opinion for the relevant text of § 75-2 of the Branford code.

 Additionally, I would also allow the plaintiff to recover the costs, including attorney’s fees, that it incurs in its attempt to enforce its rights under the municipal code. See generally Owen of Georgia, Inc. v. Shelby County, supra, 648 F.2d 1096.