Opinion
RATTIGAN, Acting P. J.
Appellant Balliet Bros. Construction Corp., a general contractor, submitted a bid on a construction contract to be awarded by the University of California. The bid was accompanied by a “bid bond” in which appellant and a corporate surety obligated
themselves to the University in the penal sum of 10 percent of the amount bid. Appellant subsequently brought this action against the University,
seeking to avoid a forfeiture of the bond pursuant to a chapter of the Government Code (hereinafter chapter 3) which may be invoked by a bidder on a public construction contract who claims to have made an excusable mistake in its bid.
The trial court sustained a general demurrer to appellant’s complaint, without leave to amend, and dismissed the action. The appeal is from the judgment of dismissal.
By reason of the procedural sequence indicated, the question is whether appellant’s complaint states a cause of action.
(Glaire
v.
La Lanne-Paris Health Spa, Inc.
(1974) 12 Cal.3d 915, 918 [117 Cal.Rptr. 541, 528 P.2d 357].) We first observe that it omits certain factual allegations, and unclearly states others, which are necessary or desirable in the statement of a cause of action under chapter 3. We would ordinarily be limited to its face in reviewing it (3 Witkin, Cal. Procedure (2d ed. 1971) Pleading, § 797, pp. 2410-2412), but the University’s brief includes a statement of “Facts” which ranges far outside the complaint and supplies most of the details which are omitted from it. We have also been requested to take judicial notice of the pleadings in another action, commenced by the University against the surety on appellant’s bid bond, in which many of the same details appear in the University’s complaint. They are such that appellant’s complaint might readily be amended to include them. Under these circumstances, and in the state of the record generally, we (1) take the judicial notice requested and (2) include the missing details in the factual recitals which follow. (See Evid. Code, §§ 452, subd. (d), 455, subd. (a), 459, subds. (a), (c); 3 Witkin,
op. cit.,
Pleading, §§ 798, 845, pp. 2412, 2450. See also 6 Witkin,
op. cit.,
Appeal, § 428, p. 4394.)
Facts
The pertinent events occurred between July 1976, and April of 1977. On July 13, the University advertised for competitive bids on a contract to be awarded for the construction of a building on its San Francisco campus. Its advertisement stated, among other things, that any bid submitted must be accompanied by “bid security” in the sum of 10 percent of the amount bid and in the form of cash, a cashier’s check, a certified check, or a “bid bond” in a specified form. Appellant submitted a written bid in the amount of $916,130 and a bid bond in which it and American Insurance Company, as its surety, jointly obligated themselves to the University in the specified form and in the 10 percent “penal sum” of $91,613.
When the bids were opened on August 12, the University determined that appellant was the lowest qualified bidder. On the next day, appellant notified the University in writing that it had made a mistake in its bid, that the bid was consequently incorrect, that the mistake had not been due to an error or carelessness as mentioned in section 4203, subdivision (d), and that appellant requested leave to withdraw the bid. The University examined the notice and the bid, determined that the mistake was due to carelessness on appellant’s part, and declined the request. On September 17, after appellant had refused to execute the contract, the University awarded it to the second lowest bidder. On November 1, the University made written demand upon American Insurance Company that it pay $91,613 “pursuant to the terms” of the bid bond. This demand was promptly refused.
Appellant commenced this action on November 8. On January 5, after the University’s general demurrer had been filed and submitted, it commenced the aforementioned action, against American Insurance Company, of which we are taking judicial
Discussion
Section 4201 provides in part that a bidder claiming a mistake “may bring” a chapter 3 action “for the recovery of the amount forfeited.” (See fn. 2,
ante.)
The trial court adopted the University’s position that this language made the
actual forfeiture
of the bid bond’s penal sum a prerequisite to the action, and that appellant failed to state a cause of action because its complaint did not allege this fact.
If appellant had accompanied its bid with “security” in the permitted form of a cashier’s check or a certified check made payable to the University in the required amount of 10 percent of the bid (see fn. 3,
ante),
or of a cash payment to the University in that amount, the University could have declared a forfeiture when appellant declined to execute the contract. If these events had occurred, appellant’s present action would have been “for the recovery of the amount forfeited” in that manner. (See § 4201.) They did not occur because appellant chose the alternative permissible form of a bid bond in the required amount and with American Insurance Company as the surety. That “amount” does not yet stand literally “forfeited,” because the University has proceeded no further than to demand (on November 1, 1976) that the surety pay it, to sue the surety for its collection by way of forfeiture, and to proceed against the surety’s answer and cross-complaint asserting nonliability. (See fn. 5,
ante.)
The specific question presented is therefore whether a bidder who has used a bid bond to secure his bid, and who has subsequently claimed a mistake in the bid, must be denied the remedy which chapter 3 makes available to/ one who has posted bid security in cash or its equivalent. For the several reasons next stated, we hold that the remedy is
not
to be denied a bidder in that position, and that appellant has stated a cause of action in exercising it.
In the first place, section 4205 draws an express distinction between “[a] bidder who claims a mistake
or
who forfeits his bid security” and repeats it in referring to “the project on which the mistake was claimed
or
security forfeited.” (Italics added in each instance.) According to the plain language of the twice-used disjunctive, section 4205 is susceptible of the single meaning that a bidder “who claims a mistake,” and who may maintain a chapter 3 action upon that ground, need not be one who
has forfeited
his “bid security.”
That meaning is not as readily perceptible in the language of section 4201, but it may fairly be read there if the clause “for the recovery of the amount forfeited” is construed as
illustrative
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Opinion
RATTIGAN, Acting P. J.
Appellant Balliet Bros. Construction Corp., a general contractor, submitted a bid on a construction contract to be awarded by the University of California. The bid was accompanied by a “bid bond” in which appellant and a corporate surety obligated
themselves to the University in the penal sum of 10 percent of the amount bid. Appellant subsequently brought this action against the University,
seeking to avoid a forfeiture of the bond pursuant to a chapter of the Government Code (hereinafter chapter 3) which may be invoked by a bidder on a public construction contract who claims to have made an excusable mistake in its bid.
The trial court sustained a general demurrer to appellant’s complaint, without leave to amend, and dismissed the action. The appeal is from the judgment of dismissal.
By reason of the procedural sequence indicated, the question is whether appellant’s complaint states a cause of action.
(Glaire
v.
La Lanne-Paris Health Spa, Inc.
(1974) 12 Cal.3d 915, 918 [117 Cal.Rptr. 541, 528 P.2d 357].) We first observe that it omits certain factual allegations, and unclearly states others, which are necessary or desirable in the statement of a cause of action under chapter 3. We would ordinarily be limited to its face in reviewing it (3 Witkin, Cal. Procedure (2d ed. 1971) Pleading, § 797, pp. 2410-2412), but the University’s brief includes a statement of “Facts” which ranges far outside the complaint and supplies most of the details which are omitted from it. We have also been requested to take judicial notice of the pleadings in another action, commenced by the University against the surety on appellant’s bid bond, in which many of the same details appear in the University’s complaint. They are such that appellant’s complaint might readily be amended to include them. Under these circumstances, and in the state of the record generally, we (1) take the judicial notice requested and (2) include the missing details in the factual recitals which follow. (See Evid. Code, §§ 452, subd. (d), 455, subd. (a), 459, subds. (a), (c); 3 Witkin,
op. cit.,
Pleading, §§ 798, 845, pp. 2412, 2450. See also 6 Witkin,
op. cit.,
Appeal, § 428, p. 4394.)
Facts
The pertinent events occurred between July 1976, and April of 1977. On July 13, the University advertised for competitive bids on a contract to be awarded for the construction of a building on its San Francisco campus. Its advertisement stated, among other things, that any bid submitted must be accompanied by “bid security” in the sum of 10 percent of the amount bid and in the form of cash, a cashier’s check, a certified check, or a “bid bond” in a specified form. Appellant submitted a written bid in the amount of $916,130 and a bid bond in which it and American Insurance Company, as its surety, jointly obligated themselves to the University in the specified form and in the 10 percent “penal sum” of $91,613.
When the bids were opened on August 12, the University determined that appellant was the lowest qualified bidder. On the next day, appellant notified the University in writing that it had made a mistake in its bid, that the bid was consequently incorrect, that the mistake had not been due to an error or carelessness as mentioned in section 4203, subdivision (d), and that appellant requested leave to withdraw the bid. The University examined the notice and the bid, determined that the mistake was due to carelessness on appellant’s part, and declined the request. On September 17, after appellant had refused to execute the contract, the University awarded it to the second lowest bidder. On November 1, the University made written demand upon American Insurance Company that it pay $91,613 “pursuant to the terms” of the bid bond. This demand was promptly refused.
Appellant commenced this action on November 8. On January 5, after the University’s general demurrer had been filed and submitted, it commenced the aforementioned action, against American Insurance Company, of which we are taking judicial
Discussion
Section 4201 provides in part that a bidder claiming a mistake “may bring” a chapter 3 action “for the recovery of the amount forfeited.” (See fn. 2,
ante.)
The trial court adopted the University’s position that this language made the
actual forfeiture
of the bid bond’s penal sum a prerequisite to the action, and that appellant failed to state a cause of action because its complaint did not allege this fact.
If appellant had accompanied its bid with “security” in the permitted form of a cashier’s check or a certified check made payable to the University in the required amount of 10 percent of the bid (see fn. 3,
ante),
or of a cash payment to the University in that amount, the University could have declared a forfeiture when appellant declined to execute the contract. If these events had occurred, appellant’s present action would have been “for the recovery of the amount forfeited” in that manner. (See § 4201.) They did not occur because appellant chose the alternative permissible form of a bid bond in the required amount and with American Insurance Company as the surety. That “amount” does not yet stand literally “forfeited,” because the University has proceeded no further than to demand (on November 1, 1976) that the surety pay it, to sue the surety for its collection by way of forfeiture, and to proceed against the surety’s answer and cross-complaint asserting nonliability. (See fn. 5,
ante.)
The specific question presented is therefore whether a bidder who has used a bid bond to secure his bid, and who has subsequently claimed a mistake in the bid, must be denied the remedy which chapter 3 makes available to/ one who has posted bid security in cash or its equivalent. For the several reasons next stated, we hold that the remedy is
not
to be denied a bidder in that position, and that appellant has stated a cause of action in exercising it.
In the first place, section 4205 draws an express distinction between “[a] bidder who claims a mistake
or
who forfeits his bid security” and repeats it in referring to “the project on which the mistake was claimed
or
security forfeited.” (Italics added in each instance.) According to the plain language of the twice-used disjunctive, section 4205 is susceptible of the single meaning that a bidder “who claims a mistake,” and who may maintain a chapter 3 action upon that ground, need not be one who
has forfeited
his “bid security.”
That meaning is not as readily perceptible in the language of section 4201, but it may fairly be read there if the clause “for the recovery of the amount forfeited” is construed as
illustrative
of the remedy’s objectives but not
exclusive.
That construction is consistent with the chapter’s provisions regarding the proof which a bidder claiming mistake must show in the exercise of the remedy. The required proof includes the fact of his mistake, its effect, its cause, and his having given timely notice of it. (§ 4203.) It does not include proof that there has been an actual forfeiture of any “amount” of money.
The indicated construction of section 4201 is also consistent with the principal objective of the chapter 3 remedy, which is to relieve a mistaken bidder of liability
on his bid.
This objective appears from the remedy’s nonstatutory predecessor, which was an equitable action for rescission of the bid on the ground of mutual mistake.
(M. F. Kemper Const. Co.
v.
City of L. A.
(1951) 37 Cal.2d 696, 700-702 [235 P.2d 7], See
A & A Electric, Inc.
v.
City of King
(1976) 54 Cal.App.3d 457, 461-462 [126 Cal.Rptr. 585].) It may reasonably be presumed that the Legislature intended to permit the same result when it enacted chapter 3 in 1971. (Stats. 1971, ch. 1584, § 2, pp. 3195-3196.
See Buckley v. Chadwick
(1955) 45 Cal.2d 183, 200 [288 P.2d 12, 289 P.2d 242];
A &A Electric, Inc.
v.
City of King, supra,
54 Cal.App.3d at p. 463.)
The indicated construction of section 4201 also avoids any ostensible disparity with sections 4203 and 4205. It thus comports with the settled canons of statutory interpretation which require that all parts of an enactment must be “harmonized ... in the context of the statutory framework as a whole”
(Moyer
v.
Workmen’s Comp. Appeals Bd.
(1973) 10 Cal.3d 222, 230-231 [110 Cal.Rptr. 144, 514 P.2d 1224]) and “that where there are conflicting provisions, the one susceptible to only one meaning will control the one that is susceptible of two meanings, if the statute can thereby be made harmonious.”
(REA Enterprises
v.
California Coastal Zone Conservation Com.
(1975) 52 Cal.App.3d 596, 610 [125 Cal.Rptr. 201].)
We find a basis for the same construction in the demonstrable purpose of chapter 3, which is to provide a judicial remedy whereby a dispute attending a low bidder’s claim of mistake may be
promptly
resolved. (See § 4203, subd. (b), imposing a 5-day limitation upon notice of the claim; § 4202, providing a 90-day period of limitation within which the chapter 3 action must be filed; § 4207, implementing the stated “end that all such actions shall be quickly heard and determined.”) In the bid bond situation, the low bidder claiming mistake cannot possibly meet the 90-day deadline if—as in the present case—the issue of forfeiture for excusable mistake must be litigated first.
The potential for indefinite prelitigation delay is aggravated in this case because the creditor demanding forfeiture under the bid bond (i.e., the University) has neither demanded payment by the principal (appellant) nor sued it (see fn. 4,
ante),
and the surety (American Insurance Company) is entitled by law to require the creditor to proceed against the principal first. (Civ. Code, § 2845.) In sum, to require an actual forfeiture
under appellant’s bid bond, as a prerequisite to its exercising the chapter 3 remedy, would utterly frustrate the legislative purpose in point of time. We cannot conceive that the Legislature intended to permit this in any case.
We conclude that appellant was not required to allege the fact of forfeiture under its bid bond, that it has stated a cause of action pursuant to chapter 3, and that the issue of forfeiture should be litigated by consolidating appellant’s action with the University’s suit against American Insurance Company (see fn. 4,
ante)
or by the University’s filing a cross-complaint in the present action. (See
M. F. Kemper Const. Co.
v.
City of L. A., supra,
37 Cal.2d 696 at pp. 699, 706;
A & A Electric, Inc.
v.
City of King, supra,
54 Cal.App.3d 457 at pp. 461, 466.)
By reason of the foregoing conclusion, other issues raised or suggested in the briefs need not be reached. Upon the remand hereinafter ordered, the trial court will require appellant to amend its complaint to set out all the material facts summarized in this opinion.
The judgment of dismissal is reversed. The cause is remanded to the trial court with directions to proceed consistent with the views expressed in this opinion.
Christian, J., and Ragan, J.,
concurred.