Kennedy Temporaries v. Comptroller of Treasury

468 A.2d 1026, 57 Md. App. 22, 1984 Md. App. LEXIS 239
CourtCourt of Special Appeals of Maryland
DecidedJanuary 4, 1984
Docket484, September Term, 1983
StatusPublished
Cited by8 cases

This text of 468 A.2d 1026 (Kennedy Temporaries v. Comptroller of Treasury) is published on Counsel Stack Legal Research, covering Court of Special Appeals of Maryland primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Kennedy Temporaries v. Comptroller of Treasury, 468 A.2d 1026, 57 Md. App. 22, 1984 Md. App. LEXIS 239 (Md. Ct. App. 1984).

Opinion

WILNER, Judge.

Appellant bid on a State contract. He was underbid by one of his. competitors and therefore did not get the contract. Alleging that the low bidder should have been disqualified because of an insufficient bid bond, appellant eventually commenced a proceeding that has grown in complexity at each successive stage. We now have before us cross-appeals from a judgment of the Circuit Court for Baltimore City involving significant questions concerning the State procurement law, the regulations issued under it, the jurisdiction and authority of the State Board of Public Works and the State Board of Contract Appeals, the right of a bidder “entitled” to a contract to recover damages from the State for the 'wrongful award of the contract to another bidder, the doctrine of sovereign immunity, and assorted alleged waivers.

It will not be necessary for us to address all of these issues, because we think that (1) appellant has no standing to . make the complaint that has engendered them, and (2) even if he had such standing, at a critical stage he effectively waived his right to adjudicate that complaint. Unfortunately, in order to demonstrate how that occurred, we shall be obliged to discuss in some detail not only the factual and procedural history of the case but also the procurement law, the regulations issued under it, and some of the procedures mandated by the law and the regulations.

*27 I. The Procurement Law

In 1980, after several years of study, the General Assembly enacted a new procurement code for the State. It took effect July 1, 1981, and is presently codified as Md.Code Ann. art. 21.

The heart of the law is § 2 -201(a), which states simply that no State agency in the Executive Branch “may enter into a contract for supplies, services, or construction except in accordance with the provisions of this article and the regulations established pursuant to this article.” The law then sets forth some basic rules governing the methods by which the State is to select and deal with its suppliers. In title 3, for example, it authorizes five types of source selection (§ 3-201(a)), establishes a preference for one of them— competitive sealed bidding (§ 3-201(b)), and requires that when that method is used, “[t]he contract shall be awarded to the responsive and responsible bidder whose bid is . . . the lowest bid price. . . . ” Other sections in title 3 specify qualification standards for bidders (subtitle 4), bond requirements (subtitle 5), and restrictions on certain types of contracts (subtitle 7).

In title 7 (§ 7-201), the law establishes a specific four-step procedure for resolving disputes relating to both the formation of a contract (i.e., the award of a contract) and a contract already awarded. The first step is the agency procurement officer who, upon timely demand, and “consistent with ... all applicable laws and regulations,” is authorized to “negotiate and resolve” these disputes, including disputes “concerning the qualification of bidders . . . and the determination of the successful bidder.. . . ” (§ 7-201(a)). The second step is review of the procurement officer’s decision by the agency head, who may “approve or disapprove the procurement officer’s decision” and whose determination “is deemed final action by the agency. . . . ” (§ 7-201(c)). The third step is an appeal to the Board of Contract Appeals, an independent entity created by § 7-202. The decision of that Board, according to § 7-201(d), “is final *28 only subject to judicial review.” Judicial review, in accordance with the Administrative Procedure Act, is the fourth and final step. (§ 7-203).

Subject to these statutory criteria, the essential thrust of the law is to continue overall control over State procurement in the Board of Public Works, where it has resided for at least fifty years, but to permit the Board, by regulation, to delegate part of its control authority to four other State agencies having special procurement responsibilities — the University of Maryland and the Departments of Budget and Fiscal Planning, General Services, and Transportation. These five agencies — but primarily the Board of Public Works — are directed to develop the necessary implementing details and procedures by administrative regulation. We see this in § 2-101.

Section 2-101(a) places in the Board of Public Works “power and authority over the procurement, management, and control of all supplies, services, construction, and other items procured by the State.” See also Md.Code Ann. art. 78A, §§ IB and 10. To carry out the provisions of the statute, the Board “has authority to set policy and to adopt regulations which are consistent with this article,” as well as to exercise any authority conferred on the other four specified agencies. Subsection (b) also deals with regulations. It states, in relevant part, that the Board “shall adopt regulations, consistent with this article, governing procedures for the review and approval of procurement contracts ... [and] procedures for review of determinations.... ” The Board is further directed to “ensure that the regulations of the procurement agencies provide for procedures which are consistent with this article and which are substantially the same among the agencies.”

The four departmental procurement units derive their special authority from § 2-101(c). That section directs each of those agencies to adopt regulations “consistent with this article” concerning a number of things, including *29 “[Rejection of bids, consideration of alternate bids, and waiver of informalities in bids.”

Regulations were, in fact, adopted by the Board and the four other agencies, effective July 1, 1981. They appear in COMAR, Title 21, and include, among other things, procedures and requirements relating to bid bonds (21.06.07), protests (21.10.02), the Board of Contract Appeals (21.02.02 and 21.10.06), and the waiver of minor irregularities and deficiencies in bids (21.05.02.12 and 21.06.02.03). Approval authority over certain types of procurement contracts was delegated to the other four agencies (21.02.01.03-07), but anything not delegated was reserved to the Board of Public Works. With respect to any such contracts (including service contracts exceeding $100,000), the agency procurement officer has no authority to award the contract. His decision, or, upon review, that of the agency head or the Board of Contract Appeals, is in the nature of a recommendation to the Board of Public Works, which alone can approve or reject.

When these various provisions governing the dispute-resolution process and the overall authority of the Board of Public Works are read together harmoniously, as they should be, the legislative intent seems clear that the dispute-resolution process set forth in § 7-201 should be completed before the Board of Public Works, as the final approval authority, acts on a disputed matter concerning contract formation, in order that the Board may then act in conformance with the decision reached through that process. That is what § 2-201(a) would seem to require; and only in that manner can the prerogatives of the Board under the law be clearly and neatly meshed with the more specific criteria and procedures mandated by the General Assembly.

II. Factual and Procedural Setting

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Bluebook (online)
468 A.2d 1026, 57 Md. App. 22, 1984 Md. App. LEXIS 239, Counsel Stack Legal Research, https://law.counselstack.com/opinion/kennedy-temporaries-v-comptroller-of-treasury-mdctspecapp-1984.