Court Opinion

ID: 9571771
Source: CourtListenerOpinion
Date Created: 2023-08-21 20:35:00.671211+00
Date Added: 2024-06-11T12:30:55.850009
License: Public Domain

MACY, Chief Justice,
concurring in part and dissenting in part, with whom TAYLOR, Justice, joins.
Reiman submitted the lowest of several sealed bids to perform a construction contract for the City of Cheyenne. After the bids were unsealed, Reiman asked to withdraw its bid without having to forfeit its bid guarantee because it had accidentally omitted $71,000 in costs from the original bid. The City let the contract to Reiman and informed Reiman that, unless it performed the construction according to the original bid, it would forfeit its bid guarantee.
Reiman filed a petition for a declaratory judgment and a motion for a preliminary injunction in the district court. Before Rei-man’s claims were heard, however, the parties executed an addendum to the construction contract designed to settle part of their dispute. Reiman agreed to withdraw its motion for a preliminary injunction, to sign the construction contract as amended, and to perform the construction. The City agreed to pay the additional $71,000 and, implicitly, to return Reiman’s bid guarantee if the district court ruled that Reiman was entitled to rescind its original bid. Both parties reserved the right to appeal from the district court’s ruling.
After the first trial court proceeding and the first appeal to this Court, the district court ruled that Reiman was entitled to rescind its bid and, pursuant to the compromise agreement, to receive the higher contract price. The City brought this second appeal.
The majority holds that the district court erred because in Wyoming a city construction contract bidder is prohibited by an unambiguous statute from withdrawing an erroneous bid without having to forfeit its bid guarantee and because, once a city awards a contract, the city has no authority to modify that contract. Nonetheless, the majority holds that, because of our public policy favoring litigation settlement, the parties’ settlement agreement must be enforced. I disagree.
Because we must give effect to the public policy expressed in an unambiguous statute, I would reverse and remand with directions that the original construction contract be enforced.
“Our rule in Wyoming is unequivocal. Municipalities, being creatures of the state, have no inherent powers but possess only the authority conferred by the legislature.” K N Energy, Inc. v. City of Casper, 755 P.2d 207, 210 (Wyo.1988); but cf. Wyo. Const. Aut. 13, § 1 (home-rule amendment authorizing cities and towns to elect out of certain statutes which are not uniformly applicable). “When the statutory delegation of power to a local governmental entity specifies a procedure to be followed in the exercise of that power, the procedure becomes a condition of and restriction upon the grant.” Schoeller v. Board of County Commissioners of County of Park, 568 P.2d 869, 877 (Wyo.1977).
A city’s authority to contract for public improvements is circumscribed by statute. Wyo.Stat. § 15-1-113 (1992). Any contract made in violation of § 15-1-113 is void. Section 15-l-113(o). “Where a municipal contract is void because it is opposed to a mandatory statute, no contract or benefit can be implied.” Robert W. Anderson Housewrecking and Excavating, Inc. v. Board of Trustees, School District No. 25, Fremont County, Wyoming, 681 P.2d 1326, 1330 (Wyo.1984). A bid to perform a public construction contract is an irrevocable offer, and, once the public body makes the award, it loses its discretion to rescind the contract. Id. at 1332.
Only two remedies are available under § 15-1-113 for a mistake which has been made in the lowest qualified and responsible bid. First, with an appropriate finding, the City may reject all bids and rebid the project. Four Nines Gold, Inc. v. 71 Construction, Inc., 809 P.2d 236, 237 (Wyo.1991) (citing § 15-l-113(c)). Second, the bidder may decline either to execute the contract or to perform the construction and thereby forfeit its bid guarantee. Section 15-l-113(f).
Nowhere in § 15-1-113, or in any of our statutes, is the City granted authority to negotiate away a low bidder’s obligation to *131either “enter into” or “proceed with the performance of’ the construction contract as bid. Section 15 — 1—113(f); compare § 15-1-113 with Wyo.Stat. § 16-6-117 (1990) (authorizing settlement of disputed cost claims at the time the final payment is made) and Wyo. Stat. § 16-6-701(a)(iv) (1990) (recognizing modifications in contract performance terms by “change orders agreed to by the parties”). The City’s agreement compromising the terms of its public improvement contract is not only unauthorized but also expressly prohibited by § 15-1-113(0).
Section 15-1-113 “ ‘is by no means a general grant of power, but is narrowly tailored to set procedural standards.’ ” City of Green River v. Debernardi Construction Co., Inc., 816 P.2d 1287, 1292 (Wyo.1991) (quoting the trial court opinion letter with approval). “In the absence of any suggestion that the legislature so intended, this court will not extend through judicial fiat what the legislature has not chosen to express in statute.” K N Energy, Inc., 755 P.2d at 216.
“When we find the terms of a statute unambiguous, judicial inquiry is complete except in rare and exceptional circumstances.” Demarest v. Manspeaker, 498 U.S. 184, 190, 111 S.Ct. 599, 604, 112 L.Ed.2d 608 (1991) (reversing 495 U.S. 903, 110 S.Ct. 1921, 109 L.Ed.2d 285 (1990)), on remand, 930 F.2d 33 (10th Cir.1991). “The remedy for any dissatisfaction with the results in particular cases lies with Congress and not with this Court. Congress may amend the statute; we may not.” Griffin v. Oceanic Contractors, Inc., 458 U.S. 564, 576, 102 S.Ct. 3245, 3253, 73 L.Ed.2d 973 (1982) (reversing 454 U.S. 1052, 102 S.Ct. 595, 70 L.Ed.2d 587 (1981)), on remand, 685 F.2d 139 (5th Cir.1982).
Similarly, our Legislature may amend § 15-1-113 to permit settlement negotiations between a city and its contract bidders. We may not. For this reason alone, we must reverse the trial court’s ruling.
Even if our statutes did not require reversal, an analysis of the competing public policies would result in requiring reversal. The public policy expressed by § 15-1-113 is “[t]o safeguard public funds by preventing extravagance in their expenditure.” Centric Corporation v. Barbarossa & Sons, Inc., 521 P.2d 874, 875 (Wyo.1974). That policy was circumvented when the City relinquished $71,-000 in public money in violation of the competitive bidding statute.
To measure against this loss of public money, the majority offers the public’s interest in litigation settlement. The majority’s justification is baffling. The settlement agreement in this case expressly anticipated future litigation. It has, in fact, produced over three years of litigation. Agreements designed to produce protracted litigation should not be encouraged. See Reiman Corporation v. City of Cheyenne, 838 P.2d 1182, 1190 (Wyo. 1992) (Thomas, J., dissenting) (dispositive public policy concern should be preservation of the competitive bidding process by enforcing clear language of § 15-1-113).
The majority contends that, because neither party challenged the validity of the compromise agreement, we should not address that issue. Again, I disagree.
It is a court’s duty, on its own motion, to refuse to entertain an action from an agreement expressly made illegal by statute. Williams v. Weber Mesa Ditch Extension Company, Inc., 572 P.2d 412, 414-15 (Wyo. 1977). Contracts cannot be used to hoodwink the law and cannot rise above constitutional and statutory law. Tri-County Electric Association, Inc. v. City of Gillette, 584 P.2d 995, 1004 (Wyo.1978).
Nor should we encourage the making of agreements designed to compromise an unequivocal statutory duty. See Ballangee v. Board of County Com’rs of Fremont County, 66 Wyo. 390, 212 P.2d 71, 76 (1949) (agreement to compromise a mandatory statutory duty is void because it is unsupported by consideration). The people gain nothing when their city agrees to relax the statutory obligations of a public contract bidder. Cf. Wyo. Const. Art. 3, § 40 (prohibiting a municipal corporation from diminishing obligations owed to it, except as prescribed by the Legislature).
The taxpayers in this case have needlessly paid not only the $71,000 forsaken by the City’s unlawful agreement but also the costs of the City’s attorneys and the court personnel involved in this litigation. Sadly, I re*132peat: “Everyone involved in this controversy can take credit for making a simple matter complex and excessively litigious.” Cook v. Zoning Board of Adjustment for the City of Laramie, 776 P.2d 181, 187 (Wyo.1989) (Maey, J., concurring in part and dissenting in part).
I concur with the majority’s conclusion that the statute is unambiguous. I would, however, reverse the trial court’s ruling and remand the case with directions that the original contract be enforced. I, therefore, dissent from the majority’s disposition of the case.