Noce, U. S. District Engineer v. Edward E. Morgan Co.

106 F.2d 746, 1939 U.S. App. LEXIS 4725
CourtCourt of Appeals for the Eighth Circuit
DecidedOctober 7, 1939
DocketNo. 11535
StatusPublished
Cited by2 cases

This text of 106 F.2d 746 (Noce, U. S. District Engineer v. Edward E. Morgan Co.) is published on Counsel Stack Legal Research, covering Court of Appeals for the Eighth Circuit primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Noce, U. S. District Engineer v. Edward E. Morgan Co., 106 F.2d 746, 1939 U.S. App. LEXIS 4725 (8th Cir. 1939).

Opinion

SANBORN, Circuit Judge.

This appeal is from a decree permanently enjoining the appellant (defendant), a District Engineer and contracting officer of the United States, (1) from making any charge against the appellee (plaintiff), a Mississippi corporation, (the business of which is mainly doing levee work for the United States under contract) and its surety, upon the theory that the plaintiff had defaulted upon its bid for doing certain levee work; (2) from entering into a contract for the doing of such work with Haralson & Cunningham and G. & P., Inc., of Houston, Texas (hereinafter called Haralson Company); and (3) from entering into a contract with any bidder other than the plaintiff, except upon a rejection of all bids and a readvertising and reletting.

The facts are not in dispute. The defendant in the fall of 1938 advertised for bids for the doing of three items of levee work within his District. The plaintiff, the Haralson Company, and others submitted bids. The plaintiff’s bid contained an unconditional proposal to do each of the items at a certain figure. The aggregate figure for the three items was $136,OOO.'1 The plaintiff also submitted a combination bid, which was conditional. Its proposal under its combination bid was to do all of the work for $108,000, but the bid, by its terms, was to be disregarded if the plaintiff was the low bidder on two of the separate items of work. The plaintiff was the low bidder under its uncondi[748]*748tional bid upon the separate items and also under its combination bid. Haralson Company was the next low bidder under a bid proposing to do the entire work for $156,-000. Since the plaintiff was the low bidder upon each of the items of work, its conditional combination bid was, by the terms of the bid, to be disregarded, which left for acceptance only its unconditional bid for each of the items separately or in the aggregate. The defendant, however, did not disregard the combination bid, but treated it as an unconditional bid to do the work for $108,000. He thereupon notified the plaintiff of the acceptance of its combination bid, and tendered to it a form of contract which would have required it to do the work for that figure. The plaintiff refused to enter into such a contract and called attention to the condition of its proposal which required that its combination bid should be disregarded under the circumstances. The defendant thereupon awarded the contract to Haralson Company upon its bid for $156,000, and notified the plaintiff and the surety upon its bid bond to that effect-and that they would-be held responsible for $48,000, the difference between the plaintiff’s bid of $108,000 and the .Haralson Company bid of $156,-000. The defendant then sent a form of contract to Haralson Company, which that company signed and returned to the defendant, who would have executed it except for a restraining order issued in this suit. .

It is the duty of the Secretary of War to.apply the money appropriated by Congress for improvements of rivers and harbors, in carrying on the work, “by contract or otherwise, as may be most economical and advantageous to the Government.”Section 622, Tit. 33, U.S.C., 33 U.S.C.A. § 622. ,

Contracts for the doing of river and harbor work are required to be made after public advertisement for proposals, in such manner and form as the Secretary of War -shall prescribe, and -to be made with the ■lowest responsible bidder. Section 623, Tit. 33, U.S.C., 33 U.S.C.A. § 623.

The Secretary of War is • authorized to prescribe rules to be observed in the preparation, submission and opening of bids for contracts under the War Department. He may require bonds of bidders ' conditioned for the carrying out of their bids. “If after' the acceptance of a bid and a notification thereof to the bidder he fails within the time prescribed by the Secretary of War or other duly authorized officer to enter into a contract and furnish a bond with good and sufficient security for the proper fulfillment of its terms, the Secretary or other authorized officer shall proceed to contract with some other person to furnish the supplies or perform the service required, arid shall forthwith cause the difference between the amount specified by the bidder in default in the proposal and the amount for which he may have contracted with another party to furnish the supplies or perform the service for the whole period of the proposal to be charged up against the bidder and his guarantor or guarantors, and the sum may be immediately recovered by the United States for the use of the War Department in an action of debt against either or all of such persons.” Section 218, Tit. 5, U.S.C., 5 U.S.C.A. § 218.

Prior to submitting its bid, the plaintiff had received from the defendant a - standard form of instructions to bidders and a standard form of invitation for bids. 'The former reserved to the defendant the right “to reject any and all bids, or to waive informality in bids received, and to reject or accept any items of any bid.” Neither the instructions to bidders nor the invitation for bids contained any notice to the plaintiff that if it submitted a bid with conditions which were objectionable to the defendant or which he might regard as not being in conformity with the instructions, he might ignore the conditions and accept the bid as an unconditional and unqualified bid.

This suit was brought to prevent the defendant from treating the plaintiff as a defaulting bidder and charging it with the difference between the amount of its conditional combination bid and the amount of the Haralson Company bid. Since the charge could only be made after the contract with the Haralson Company or some other bidder was entered into, the plaintiff sought to enjoin the defendant from making such contract.

Upon the trial the plaintiff introduced evidence tending to show that if the de- ’ f endant succeeded in charging it with $48,-000' as being • a bidder in default, its business would be injured; that the notice that such a charge would be made had affected its ability to procure bonds from the surety company which had furnished it with bonds in connection with its contracts with [749]*749the Government; that ninety per cent of the plaintiff’s work was done under such contracts; that payments on other contracts would or might be withheld by the Government to apply against this charge; f ^ of $22,000 under one of such contracts had been withheld by the defendant and had been paid only after protest was made There was no evidence that the failure oí - , - t1 ^ . t e e en ant to awar e con rae o the plaintiff as the lowest responsible biddaína ^ P *** ® '

. The defendant contends that the suit is, in effect, one against the United States, which is an indispensable party and has not consented to be sued; that the Secretary of War is an indispensable party; that the plaintiff is without standing to sue, and that it failed to make a case entitling it to injunctive relief.

We think there is no merit in any of these contentions in so far as the suit is one to prevent the defendant from making an unlawful charge against the plaintiff. Assuming that the conditions which the plaintiff attached to its combination bid were violative of the rules for and the instructions to bidders and for that reason the defendant had the right not only to reject, but to ignore, the plaintiff’s entire proposal, there was nothing in the law or in the instructions or invitation furnished the plaintiff which gave to the defendant the right to disregard the conditions of the combination bid.

Free access — add to your briefcase to read the full text and ask questions with AI

Related

Ottinger v. Blackwell
173 F. Supp. 817 (E.D. Arkansas, 1959)
Walter P. Villere Co. v. Blinn
156 F.2d 914 (Fifth Circuit, 1946)

Cite This Page — Counsel Stack

Bluebook (online)
106 F.2d 746, 1939 U.S. App. LEXIS 4725, Counsel Stack Legal Research, https://law.counselstack.com/opinion/noce-u-s-district-engineer-v-edward-e-morgan-co-ca8-1939.