Court Opinion

ID: 1060285
Source: CourtListenerOpinion
Date Created: 2013-10-09 18:43:41.587801+00
Date Added: 2024-06-11T12:05:17.494968
License: Public Domain

Present:     All the Justices

HOLLY'S, INC.                                              OPINION BY

v.   Record No. 941572                          CHIEF JUSTICE HARRY L. CARRICO
                                                  June 9, 1995
COUNTY OF GREENSVILLE

               FROM THE CIRCUIT COURT OF GREENSVILLE COUNTY
                       Robert G. O'Hara, Jr., Judge

      This     litigation   commenced     with       the   filing   of     a   bill    of

complaint      by   Holly's,   Inc.    (Holly's)       against      the    County      of

Greensville (the County).        The dispute involves certain provisions

of the Virginia Public Procurement Act, Code §§ 11-35 through -80

(the Act).       Section 11-42(B) provides that "[a] public body may

waive informalities in bids," and the primary question on appeal

is   whether    this   provision      permits    a    public    body      to   waive   a

requirement concerning the timeliness of bids.
       The facts germane to the issues in the case were stipulated

by the parties.        As pertinent here, the stipulated facts reveal

the following situation:
          5. The bid invitation stated in part as follows:

             "On Thursday, March 17, 1994, at 2:00 p.m. all
             bids received for provision of residential
             solid waste collection in Greensville County
             will be opened."

             . . . .

           8. On March 17, 1994, Holly's submitted its bid at
      1:34 p.m. and had the same stamped and time-dated by the
      County . . . .      [Browning-Ferris Industries of S.
      Atlantic, Inc. (BFI)] had also submitted its sealed bid
      to a County official prior to 2:00 p.m. that day.

           9. At 1:50 p.m. a representative from [ARS-Waste
      Management, Ltd. (ARS)] was present in the room where
      the bid opening was to be conducted and had with him the
      sealed bid of ARS.

             10.     Mr. Fred Maldonado, the County employee in
charge of the bid opening process, was not in the
designated room at the time the ARS representative
arrived, and did not arrive in the designated room until
either 2:02 p.m. or 2:03 p.m.

     11. Between 1:50 p.m. and Mr. Maldonado's arrival
in   the   designated   bid-opening   room  . . .,   the
representative of Holly's, the representative of BFI,
the representative of ARS and the bid of ARS were
continually present together in the designated bid-
opening room, and throughout that time Mr. Maldonado was
apart from them and continually had in his possession
the sealed bids of both BFI and Holly's.

      12. When Mr. Maldonado entered the designated bid-
opening room, the bid of ARS was either lying upon the
table to be utilized by Mr. Maldonado (which is the
recollection of the ARS representative and of Mr.
Maldonado), or instead the ARS representative handed its
bid to Mr. Maldonado (which is the recollection of the
representative of Holly's and the representative of
BFI).
     13. Upon opening the bids ARS was the apparent low
bidder . . ., and Holly's was the next lowest bidder
 . . .

     . . . .

     15.     A regularly scheduled meeting of the
Greensville County Board of Supervisors was scheduled
for Monday, March 21, 1994, beginning at 7:30 p.m., and
an agenda item for that evening was the review of all
bids received on March 17 and an award of the contract.

     16. Prior to 5:00 p.m. on March 21, [the attorney
for Holly's] communicated Holly's protest of the bid of
ARS in two separate letters which were sent that day by
telefax, one to Mr. Maldonado and the other to the
County Attorney.

     17. At their meeting Monday evening, March 21, the
County accepted the bid of ARS and awarded the contract
to it.

     18.   As requested by [the attorney for Holly's],
the County Attorney left the Supervisors' meeting as
soon as that action was taken by the Board of
Supervisors . . . and called [the attorney for Holly's]
at his home to advise that the Board had given
consideration to the matters raised in his two letters
sent by telefax earlier that day, and thereafter taken
action awarding the contract to ARS.
           19. On March 23, 1994, the County's authorized and
      designated   representative  afforded   Holly's  written
      notice of County's decision to award the contract to the
      low bidder, ARS.

      On May 13, 1994, Holly's filed its bill of complaint alleging

that the County's award of the contract to ARS did not constitute

an honest exercise of discretion but was arbitrary and capricious

and   not    in     accordance   with    the   Act,   the     County        purchasing

procedures, or the terms and conditions of the invitation to bid.

Holly's     sought     a   permanent    injunction    against     award        of   the

contract to ARS and also sought the entry of an order declaring

Holly's the low bidder.
      After a hearing, the trial court held that the acceptance of

the ARS bid constituted a proper exercise of the County's "right

to waive informalities in the sealed bid process, which right is

afforded to County by Virginia Code Section 11-42."                  Consequently,

the court denied the prayer of Holly's for a permanent injunction

and ordered the matter stricken from the docket.

      We    first    consider    an    argument   made   by    the     County       that

"Holly's claim is barred by its failure to institute this action

within the time limits imposed by Virginia Code Section 11-66.A.
                                                                        *
and by the doctrines of laches and equitable estoppel."                       However,

in its final decree, the trial court ruled that Holly's was not

"barred from prosecuting its interests in this matter, whether by
      *
      As pertinent here, Code § 11-66(A) provides that a bidder
desiring to protest the award of a contract shall submit such
protest in writing no later than ten days after the award, that
the public body or designated official shall issue a decision in
writing within ten days, stating the reason for the action taken,
and that the decision shall be final unless the protesting bidder
institutes legal action within ten days of the written decision.
operation of Virginia Code Section 11-66, . . . by the doctrine of

equitable estoppel, by the doctrine of laches, or by any other

statute or doctrine," and, as Holly's points out, the County did

not object to this ruling; indeed, the decree is endorsed by

counsel for the County in these words:            "I ask for this decree."

Accordingly, we will not consider the County's argument.                    Rule

5:25.

        This brings us to the primary issue in the case, viz., the

timeliness of the ARS bid.            The County devotes a considerable

portion of its brief to a contention that the bid of ARS was

"submitted" prior to 2:00 p.m. on March 17, 1994, and that this

submission satisfied the requirements of the invitation to bid.               A

distinction must be made, the County maintains, between the word

"submit" and the word "receive."        Quoting a dictionary definition,

the     County   says   that    the   word   "submit"    means    "to   commit

(something)      to   the   consideration    of   another"    while   the   word

"receive" means "to take or acquire (something given, offered or

transmitted)."
        The County then argues it is undisputed that a representative

of ARS was in the bid-opening room at 1:50 p.m., that he had with

him the bid of ARS, that from the time he arrived until the

arrival of Mr. Maldonado at 2:02 or 2:03 p.m., the representative

of Holly's, the representative of BFI, the representative of ARS,

and the bid of ARS were together in the room, and that when Mr.

Maldonado entered the room, the bid was either lying on a table in

that room or forthwith handed to Mr. Maldonado.              Accordingly, says

the County, "the bid of ARS was in the place where it was required
to be before the time when it was required to be there," and the

only reason the bid was not received prior to 2:00 p.m., as

opposed to being submitted prior to 2:00 p.m., was Mr. Maldonado's

failure to be in the designated place at the designated time.                                In

short, the County asserts, "the bid of ARS was submitted both

properly and timely."

        The County opines that had the General Assembly shared the

enthusiasm      of     Holly's       for    form    over    substance,        it   would    have

provided      in     the     Act    "that     no    bids     received    (as       opposed   to

submitted)          after     the     designated       bid-opening       hour       would    be

considered."          The County points out that the General Assembly

declined to impose such a rigid and inflexible standard, and the

County    requests          that    this    Court     "likewise       adopt    a    policy   of

substance over form."

        We decline the request.                    To refuse to adopt the County's

views    on    this     subject       would    not    involve        elevating      form    over

substance but rather would involve merely giving a word its plain

and ordinary meaning.                The invitation to bid in this case stated

that on the given date all bids "received" for provision of solid

waste    collection          would    be     opened    at     2:00    p.m.         Under    this

language, a bid could not be opened at 2:00 p.m. unless it was
received before 2:00 p.m.                  Hence, it was not sufficient merely to

submit    a    bid    to     the    County    prior     to    the     appointed      hour;   in

addition, the bid must have been received by the County before

that time.          And the risk that some untoward event might occur to

prevent       the    bid's     timely       receipt    must    fall     upon       ARS,    whose

representative waited until almost the last minute to submit its
bid.

       Remaining is the question whether the County could waive the

2:00 p.m. filing requirement.       The answer to this question turns

on whether the requirement is an informality that may be waived

under Code § 11-42(B).

       The County argues that the requirement does constitute an

informality that may be waived.      The County points out that § 11-

37 defines an informality as "a minor defect or variation of a bid

. . . from the exact requirements of the Invitation to Bid . . .

which does not affect the price, quality, quantity or delivery

schedule for the . . . services . . . being procured," and the

County cites three out-of-state decisions as authority for the

proposition   that   "a   bid   tendered   late   by   a   bidder   may   be

accepted":    Townsend v. McCall, 80 So. 2d 262, 266 (Ala. 1955);

Nielsen v. City of St. Paul, 88 N.W.2d 853, 859 (Minn. 1958);

Gostovich v. City of West Richland, 452 P.2d 737, 740 (Wash.

1969).    Our research has disclosed two other decisions holding to

the same effect:     Hewitt Contracting Co. v. Melbourne Regional

Airport Auth., 528 So. 2d 122, 122 (Fla. Dist. Ct. App. 1988);

William M. Young & Co. v. West Orange Redev. Agency, 311 A.2d 390,

392 (N.J. Super. App. Div. 1973).

       Holly's also cites a number of out-of-state decisions but

they do not address the question whether a time requirement for

filing bids may be waived.       However, our research discloses four

decisions supporting the view that such a time requirement may not

be waived.    City of Atlanta v. J.A. Jones Constr. Co., 392 S.E.2d
564, 569 (Ga. Ct. App.), rev'd on other grounds, 398 S.E.2d 369
(Ga. 1990), cert. denied, 500 U.S. 928 (1991); Hawaii Corp. v.

Kim, 500 P.2d 1165, 1169 (Haw. 1972); Rexton, Inc. v. State, 521
N.W.2d 51, 53-54 (Minn. Ct. App. 1994) (distinguishing Nielsen v.

City of St. Paul, supra); Wiltom Coach Co. v. Central High School,

232 N.Y.S.2d 876, 877 (N.Y. Sup. Ct. 1962).

     Hence, five out-of-state decisions support waiver and four

support non-waiver.           We think the non-waiver decisions express

the better view for it fosters the establishment of a bright-line

rule for determining whether a bid is timely.                          As we said in
Newport News v. Doyle & Russell, Inc., 211 Va. 603, 179 S.E.2d 493

(1971), where we enforced a provision in a bid form prohibiting a

plea of mistake:
     To hold otherwise would . . . seriously jeopardize the
     sanctity of the system for bidding on public contracts
     and lead to the uncertainty and unreliability of bids.
     The system followed here for awarding such contracts
     saves the public harmless, as well as the bidders
     themselves, from favoritism or fraud in its varied
     forms.

Id. at 608, 179 S.E.2d at 497.

     In our opinion, a requirement in an invitation to bid that

fixes the time within which bids must be received is not a minor

defect    or   an   informality     that   may      be    waived   but,      rather,   a

material   and      formal   requirement      that,      under   the    circumstances

present    here,     must    be   fulfilled    to     the   letter      of   the   law.

Accordingly, we hold that the trial court erred in ruling that

ARS's late filing of its bid could be waived.                    By way of remedy,

Code § 11-70(C) provides that the award of a contract "shall be

reversed only if the [challenger] establishes that the . . . award

is not an honest exercise of discretion, but rather is . . . not
in     accordance          with   the   . . .      terms        and     conditions       of   the

Invitation to Bid."               Here, the award was not in accordance with

the     terms       and     conditions        of   the     invitation          to      bid    and,

accordingly, Holly's is entitled to the relief it seeks, viz., the

reversal of the judgment of the trial court, a declaration that

the contract between the County and ARS is void as a matter of

law,     and    a     remand      of    the    matter      to     the       trial   court     for

consideration of the prayer of Holly's for injunctive relief.
                                                                  Reversed and remanded.

JUSTICE STEPHENSON, with whom JUSTICE WHITING joins, dissenting.

       I would hold that ARS's bid was "received" timely.                              According

to the stipulated facts, "[a]t 1:50 p.m. a representative from ARS

was present in the room where the bid opening was to be conducted

and had with him the sealed bid of ARS."                              However, "the County

employee in charge of the bid opening process . . . was not in the

designated room at the time the ARS representative arrived, and

did not arrive in the designated room until either 2:02 p.m. or

2:03 p.m."          Between 1:50 p.m. and the time the County employee

arrived in the room, "the representative of ARS and the bid of ARS

were continually present together in the designated bid-opening

room."         When    the    County    employee     entered          the     designated      bid-

opening room, "the bid of ARS was either lying upon the table to

be    utilized        by   [the   County      employee]     . . .        or    . . .    the   ARS

representative handed its bid to [the County employee]."

       Thus, ARS had its sealed bid in the designated bid-opening

room ten minutes before the deadline.                           I think that ARS's bid

should not have been voided due to circumstances that were beyond
its control, i.e., the tardiness of the County's employee.