Court Opinion

ID: 883609
Source: CourtListenerOpinion
Date Created: 2013-06-05 02:31:37.326303+00
Date Added: 2024-06-11T15:23:11.285365
License: Public Domain

No.      95-153
               IN THE SUPREME COURT OF THE STATE OF MONTANA
                                                 1995

HERITAGE COMMERCIAL CONTRACTORS,
INC.,     a Montana Corporation,  and
THOMAS E. LITTLE,     SHERRY D. LITTLE,
and RICHARD A. LITTLE,
individually,

              Plaintiffs       and Appellants,
      -v. -
CITY OF HELENA, a municipal
corporation,    and W.J. VERWOLF,
City   Manager,  TED HILL,  City
Environmental    Engineer,  and unknown
John Doe, City    Officials  and Employees.
              Defendants       and Respondents.

APPEAL FROM:          District  Court of the First   Judicial  District,
                      In and for the County of Lewis & Clark,
                      The Honorable   Thomas Honzel,  Judge presiding.

COUNSEL OF RECORD:
              For    Appellants:
                       Jack   M. Scanlon,         Helena,      Montana
              For    Respondents:
                      David    N. Hull,         Helena,      Montana

                                                 Submitted      on Briefs:        May 25,    1995
                                                                       Decided:     July    25,   1995
Justice          Fred          J.       Weber          delivered               the           Opinion             of        the      Court.

          This         is     an appeal                  from        the     grant            of     City        of Helena's                        Motion         to

Dismiss          by          the           First          Judicial                District                Court,                 Lewis             and      Clark

county.           We affirm.

          Although                  the       appellant                presents                    two      issues                for        review,           the

preliminary                  question               of     standing               is     the         only        question                 that           we need

reach      at     this             time:

          Did     the         District                Court          err     in        finding            that         Heritage                Commercial

Contractors                  had no standing                         to object                to the         City            of Helena's                    award

of    a contract                   to       Good Humus Compost                               Company?
          The       City             of       Helena             (the         City)            placed                 an      ad        in         the      legal

section          of the             Independent                      Record on October                           14,         1992.             The ad was

a "Request                  for         Proposal"               to     begin            a green             waste                compost               program.
Heritage            Commercial                        Contractors                      (Heritage)                 submitted                        a     written

proposal            on October                      31,      1993.            Following                   the          initial                submission,

Heritage          supplied                   supplemental                   information                   three             times            upon request

from      the       City.

          On February                        14,         1994,         the        City             entered             into             a contract                 to

compost          its          municipal                  waste         with            the     Good Humus Compost                                      Company.

Heritage          protested                    this        award           because            it     contended                    the        City        had not
opened        the           contract               to bidding.                    The City               replied             that            the       contract

was for          a technical                        service            and excluded                       from             bid      by        5 7-5-4301,

MCA.
          Heritage                  commenced               action           for        damages             suffered                    as a result                 of

the     City's              negligence                in    failing               to comply               with          statutes               concerning

municipal               bidding.                    The       District                  Court            granted                 dismissal                to   the

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City      because                it         found          that         Heritage           had no standing                             to      object           to

the      City's               award          of      a contract.                    Heritage              appeals               this          ruling.

          Did       the         District               Court          err      in finding                that         Heritage                Commercial

Contractors                    had no standing                          to object              to the          City       of Helena's                   award

of     a contract                     to     Good Humus Compost                            Company?

          Heritage                     argues               that            unless             specifically                          excepted,             all

municipal                 contracts                  must         be awarded                   under         the       bidding                procedures

laid         out         in      § 7-5-4301,                      MCA,        et        seq.           Heritage               claims             that      the

contract            awarded                  was not              technical              as argued                   by the           City,           and was

not      therefore,                        excepted               from       the        bidding              requirement.                        Further,
Heritage            argues                 that       Baker         relied              upon by the                  District               Court,        does

not     apply            to this              case because                   in Baker            bidding               took          place,           whereas

in     the     present                 case          no bidding                procedure                took          place.

          The        City              argues              that         a contract                for          services                of      less       than

$25,000             can          be          awarded               without               use      of         the         statutory                    bidding

procedure.                     According                   to     the       City,        the      District                Court             was correct

in     finding                that         Heritage               had no standing                       to      bring           this          suit.        The

City         also        contends                   that        Heritage            has asked                  for      damages               which       is     a

new unsupported                             legal           theory;           the        proper          remedy,                if     Heritage             has

standing,                would             be to           ask     that        the       bidding               take       place.
             The District                      Court            relied        on Baker             v.        State         (1985),              218 Mont.
235,         707         ~.2d          20 for              the     proposition                   that          a party                not      awarded               a

public          contract                    fails          to     have       standing             to      contest               the         decision            by

the      municipality.                            While           Heritage              argues          that         Baker           does       not      apply

because             in        that          fact           scenario           bidding             took          place,               the      Baker       case

has      a much broader                             scope:

                                                                                    3
          [Wle have held that the discretion              of the agency to award
         public    work contracts       to the lowest      bidder      is not subject
         to judicial        review    under normal     circumstances.           (cites
         omitted).        We will    not make a contract          for the parties.
         Nor is this        Court prepared      to venture        that    Baker would
         have been awarded           the contract      if    Edsall      was not the
         successful       bidder.     In the absence of any showing             of bad
         faith,      fraud,       or corruption     of     the     Department,       the
         exercise      of discretion      will  not be disturbed.            (Emphasis
         added).

Baker, 218 Mont.              at        240,        707 P.2d          at        24.

          Regardless                of     bidding            or      no bidding,                    the        only         way this             Court

will     review          an agency's                   discretionary                    rulings--which                        would           involve
the      decision              in        this         case--is          whether                 the        action             taken           by        the

governmental                  agency             was        conducted              in     bad         faith,                with        fraud,           or

under      the         influence                 of    corruption.                      Baker
                                                                                        -I             218 Mont.                   at     240, 707
P.2d      at     24.          Heritage                has not         introduced                 a shred               of     evidence               that

would      taint          the        City's            decision.

          Further,              the             statutory             scheme             states              that            contracts                  for

construction,                  repair,                or maintenance                    under         $25,000                do not           need       to

go       through              the         bidding             procedure.                         Section                7-5-4302,                    MCA.

Contracts              that         are     professional                 in        nature             also        do not             have         to     be

bid.           Section          7-5-4301(l),                     MCA.         The         contract                in         contention                 was

under      $25,000             and involved                   professional,                     if    not         technical,                  skills.

          We conclude                    that         the    contract              in     question               was not                subject           to

the      bidding              procedure                of     § 7-5-4301,                     MCA,         et         seq.           We further

conclude           that         Heritage                has presented                    no evidence                    that            the     City's

decision           was         made         in        bad     faith       and,            therefore,                    Heritage               has        no

standing           to     object            to        the    City's          discretionary                        ruling.

          We hold             that         the        District          Court            did         not        err     in         finding             that

Heritage           Commercial                    Contractors             had no standing                               to     object            to      the
                                                                         4
City   of Helena's       award   of a contract   to Good Humus Compost   Company.

       Affirmed.

We Concur:

              Justices

                                             5
Justice       James          C. Nelson              specially           concurs:
          I concur           in     the     result          of    our      opinion        but      not     in     all       that   is

said.         I   would            go no       further           than       to     hold     that         the      contract         at

issue      here     was not               subject        to      bidding          by reason         of     the      exceptions

contained          in    §§ 7-5-4301(2),                      MCA, and 7-5-4302,                    MCA. Accordingly,

Heritage          has        no     standing           to     bring        suit      in    this          case.          I    do not

agree      that     Baker           is    necessarily              applicable             under      the        facts       here   or

dispositive             of        the     issue      which        we address.