Finney Co., Inc. v. Monarch Const. Co., Inc.

670 S.W.2d 857, 1984 Ky. LEXIS 253
CourtKentucky Supreme Court
DecidedJune 14, 1984
StatusPublished
Cited by9 cases

This text of 670 S.W.2d 857 (Finney Co., Inc. v. Monarch Const. Co., Inc.) is published on Counsel Stack Legal Research, covering Kentucky Supreme Court primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Finney Co., Inc. v. Monarch Const. Co., Inc., 670 S.W.2d 857, 1984 Ky. LEXIS 253 (Ky. 1984).

Opinions

GANT, Justice.

In December, 1980, the Commonwealth of Kentucky advertised for bids for construction of the Primary-Ambulatory Care Center at the University of Kentucky hospital, to which invitation the respondent, Monarch Construction Co., Inc., a general contractor, elected to respond. As is customary, the general contractor mailed notices to many potential subcontractors for various phases of the work, furnishing them with the requirements and specifications for the job. One of these was the movant, Finney Company, Inc., which was and is in the heating, ventilating, air conditioning and plumbing business. After two telephone calls between the parties, Finney made a verbal proposal of $2,220,000, which figure was included in Monarch’s total bid of $11,337,000. This oral offer was made by telephone within less than ten minutes of the “bid opening” at 2 p.m., February 5, 1981. At 4:30 p.m. on that date Finney learned from the consulting engineers that the bid of Monarch had been accepted. Finney apparently also learned that its name was one of two names listed by Monarch for the plumbing, heating, ventilating and air conditioning phase of the work.

The practice of submitting the names of proposed contractors should be examined at this time. The requirement for listing is set out in the “Instruction to Bidders” and “General Conditions” issued to all prospective general contractors, which documents state that the name of each proposed subcontractor shall be submitted with the proposal and that no subcontractor may be employed or substituted without the approval of the Department of Finance, Division of Contracting & Administration. The sole evidence herein relating to this procedure is that the requirement has the purpose of assisting the Division in its evaluation of bids, and other portions of the above documents specifically provide that no contractual relationship shall arise between the Division and the subcontractor by submission of its name by the general contractor.

On February 9, 1981, Monarch contacted Finney and asked for written confirmation of its oral bid. This confirmation was sent by Finney and received by Monarch on February 12. The written confirmation became the subject matter of a meeting between the parties on March 2, 1981. The written confirmation excluded one major item and 11 lesser items which Monarch contended, and the trial court found, were included in the oral bid of February 5. Additionally, the Commonwealth had accepted all the alternates listed on the contract, and Finney’s bid on these alternates [859]*859was higher than other bids received by Monarch.

At the March 2 conference the parties sought to resolve the differences, and Fin-ney was informed that, after the exclusion of the items in its written confirmation and the inclusion of the alternates, its bid was $80,000 higher than that of Aztec, another bidder. Finney contacted its own material-man and subcontractors and agreed to perform some of the omitted items and lowered its bid by some $22,000, this being communicated to Monarch on March 6. Monarch, pursuant to the requirements of the Commonwealth, secured permission to substitute the lower bidder, Aztec, and did so.

Two other bits of evidence were fed into the factual grinder which movant would rely upon. First, Finney learned from the consulting engineers that in its original bid Monarch had listed both Finney and Aztec as subcontractors for the plumbing, heating, ventilating and air conditioning, but had deleted the name of Aztec when informed by the Commonwealth that only one name could be listed. Finney also learned from the same consulting engineers that there was to be a meeting of the general contractor and all subcontractors on March 3, which meeting it attended. However, it had not been notified of the meeting by Monarch, even though they had spent the previous day in the price-haggling session.

Finney filed this action against Monarch and against the Commonwealth and certain agents thereof on five separate theories, to-wit: (a) express contract; (b) implied contract; (c) third party beneficiary; (d) constructive or quasi contract, and (e) promissory estoppel. On appeal, Finney has abandoned the third party beneficiary aspect of its contention and has appealed the summary judgment awarded Monarch. We affirm the Court of Appeals, which affirmed the Franklin Circuit Court.

On this appeal, Finney argues that a contract existed between Monarch and Fin-ney and that it should recover damages for the breach thereof. The basic question confronting this court is whether the incorporation of the name and amount of bid of a subcontractor by a general or prime contractor in its bid to the owner constitutes an acceptance which would create a contractual relationship between the general contractor and the subcontractor should the general contractor become the successful bidder. Our answer is that in the absence of a contrary statute, it does not. We are unable to find a single case to the contrary. The following cases hold that, under the stated question, there is no contractual relationship created: Holman Erection Company v. Orville E. Madsen & Sons, Inc., Minn., 330 N.W.2d 693 (1983); Interior Systems, Inc. v. Del E. Webb Corporation, 121 Cal.App.3d 312, 175 Cal. Rptr. 301 (1981); Mitchell v. Siqueiros, 99 Idaho 396, 582 P.2d 1074 (1978); K.L. House Construction Company, Inc. v. Watson, 84 N.M. 783, 508 P.2d 592 (1973); Corbin-Dykes Electric Company v. Burr, 18 Ariz.App. 101, 500 P.2d 632 (1972); Southern California Acoustics Company, Inc. v. C. V. Holder, Inc., 71 Cal.2d 719, 79 Cal.Rptr. 319, 456 P.2d 975 (1969); C.H. Leavell and Company v. Grafe & Associates, Inc., 90 Idaho 502, 414 P.2d 873 (1966); Cortland Asbestos Products, Inc. v. J & K Plumbing and Heating Company, Inc., 33 A.D.2d 11, 304 N.Y.S.2d 694 (1969); Plumbing Shop, Inc. v. Pitts, 67 Wash.2d 514, 408 P.2d 382 (1965); N. Lit-terio & Company, Inc. v. Glassman Construction Company, Inc., (D.C.Cir.1963), 319 F.2d 736; Universal Construction Company v. Arizona Consolidated Masonry & Plastering Contractors Ass’n, 93 Ariz. 4, 377 P.2d 1017 (1963); Merritt-Chapman and Scott Corporation v. Gun-derson Brothers Engineering Corporation (9th Cir.1962), 305 F.2d 659; Milone and Tucci v. Bona Fide Builders, 49 Wash.2d 363, 301 P.2d 759 (1956); Klose v. Sequoia Union High School District, 118 Cal.App.2d 636,

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Finney Co., Inc. v. Monarch Const. Co., Inc.
670 S.W.2d 857 (Kentucky Supreme Court, 1984)

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