Judge tosses appeal of Mercer-Fraser’s failed Bay Trail lawsuit

Kevin L. Hoover
Mad River Union

HUMBOLDT BAY – The Mercer-Fraser Company has lost its appeal of its failed lawsuit against the City of Arcata over the Humboldt Bay Trail North.

The company had appealed the October dismissal of its suit, which claimed that the $5 million contract for the project had been improperly awarded to McCullough Construction. It claimed that the city had bungled the bidding process on the project, and asked that it be retroactively awarded the contract for the trail rather than McCullough.

In a ruling issued Oct. 9 (see below) by Acting Presiding Judge James Richman of San Francisco's 1st District Court of Appeal, Division 2, Mercer-Fraser's appeal was dismissed as "moot," as had been predicted by Arcata City Attorney Nancy Diamond.

The judge found that with the trail having been completed, the validity of the project's contracts is no longer an issue. Though asked to challenge the contract's award to McCullough Construction, Richman found that there is no benefit to the public in doing so since there isn't any structural issue likely to threaten the public interest.

He observed that the bid documents Mercer-Fraser had alleged were faulty have been in use since November, 2016, and that the company hasn't found any problems with bids before or after the Bay Trail project's contract was awarded.

"Appellant does not point to anything in the record to suggest any confusion or ambiguity about non-collusion 6 affidavits in connection with any bids since the package was updated," Richman states.

"In these circumstances, we cannot say that this case raises an issue that is likely to recur or that material questions remain for our determination,"  Richman wrote. "...and that in any event the City did not abuse its discretion in awarding the contract to McCullough."

The ruling:

IN THE COURT OF APPEAL OF THE STATE OF CALIFORNIA FIRST APPELLATE DISTRICT DIVISION TWO

MERCER FRASER COMPANY, Plaintiff and Appellant, v. CITY OF ARCATA, Defendant and Respondent; MCCULLOUGH CONSTRUCTION, INC., Real Party in Interest and Respondent.

A153026 (Humboldt County Super. Ct. No. CV170147)

The City of Arcata (City) issued a call for bids to construct a portion of a trail network. Having determined that the lowest cost bid was nonresponsive because it did not comply with instructions requiring a non-collusion affidavit, the City awarded the bid to the second lowest cost bidder, McCullough Construction, Inc. (McCullough). Mercer Fraser Company (Appellant), which submitted the fourth lowest cost bid, filed a petition for writ of mandate in superior court challenging the award, and now appeals the denial of the petition, arguing that the award must be overturned and the project rebid.

Appellant’s opening brief, filed in March 2018, does not mention that the construction project was completed in November 2017. We agree with the City that we cannot grant Appellant any effectual relief, and therefore we shall dismiss the appeal as moot.

FACTUAL AND PROCEDURAL BACKGROUND

In August 2016, the City issued an invitation for bids to build a three-mile long trail project. Construction was to begin on or after April 15, 2017, subject to a 100-day work calendar, with the contractor to pay liquidated damages of $7,000 per calendar day of delay in completion. The instructions to bidders specified that a non-collusion affidavit was to be attached to each proposal, and that bids not accompanied by a noncollusion affidavit may be rejected. The instructions further specified that “[b]lank spaces in the PROPOSAL shall be properly filled in and the phraseology of the form must not be changed.” The instructions stated that prospective bidders should submit questions about the bid documents in writing to the City engineer, and that any interpretation or correction of the documents would be made in the form of a written addendum. Any such addenda would become part of the bid documents and be binding on all bidders.

One part of the bid package, entitled “Supplemental Conditions: Special Provisions,” included Exhibit 12-E, entitled “Noncollusion Affidavit (Title 23 United States Code Section 112 and Public Contract Code Section 7106).” The text of the affidavit was not accompanied by a signature line, but was followed by a note stating, “The above Noncollusion Affidavit is part of the Proposal. Signing this Proposal on the signature portion thereof shall also constitute signature of this Noncollusion Affidavit. Bidders are cautioned that making a false certification may subject the certifier to criminal prosecution.”

Another part of the bid package, entitled “Bidders Book,” included various forms for each bidder to complete and submit to the City. One of those forms was a “NonCollusion Affidavit to be Executed by Each Awardee of a Principal Contract” (BB-30 Affidavit). The text of the BB-30 Affidavit is not identical to Exhibit 12-E, and in addition, the BB-30 Affidavit has blanks to be filled in and a signature line. The BB-30 Affidavit was not in the form of the declaration under penalty of perjury required for every bid on every public works contract by Public Contract Code section 7106, as enacted in 2011 (Stats. 2011, ch. 432, § 37); instead, it was in the form of a notarized 3 affidavit, as specified by the previous version of that section, but did not include all language required by the previous version. 1 (Stats. 1988, ch. 1548, § 1.)

Before the bids were due, the City engineer received a request for a checklist of the documents to be submitted with bids. In response, the City issued an addendum to the bid documents that included a list of required documents, one of which was the BB30 Affidavit.

The City received five sealed bids, ranging from $4,462,662 to $5,551,830. The lowest bid, from Stewart Engineering (Stewart), which is not a party to this appeal, included an unsigned BB-30 Affidavit. The third lowest bid included an unsigned BB-30 Affidavit and an unsigned addendum. The fifth lowest bid was lacking some cost amounts. The City determined these three bids were nonresponsive for failure to comply with bid instructions. The second lowest bid, from McCullough, and the fourth lowest, from Appellant, were determined to be responsive. The City determined that McCullough was the lowest responsive responsible bidder for the project and in November 2016, McCullough was awarded the contract over protests.

One of the unsuccessful protests was from Appellant. Although Appellant had submitted a signed BB-30 Affidavit with its proposal, Appellant argued that the bid instructions did not require the submission of a signed BB-30 Affidavit, and that any failure to submit one could be waived as a minor irregularity, with the result that Stewart would be awarded the contract as lowest bidder. The argument relied on the statement in Exhibit 12-E that signing the bid book constitutes signing the Exhibit 12-E non-collusion affidavit, and on the statement in the BB-30 Affidavit that it was to be signed by the “awardee,” which, Appellant argued, could not happen until after the project was awarded. Appellant further argued that if the City refused to waive irregularities concerning signed BB-30 Affidavits, then the City should determine that McCullough’s bid, which contained other irregularities, was nonresponsive, with the result that Appellant would be awarded the contract. Alternatively, Appellant argued that the city should rebid the project.

1 Further undesignated statutory references are to the Public Contract Code. In November 2016, the City began to use the current section 7106 form in its public bid documents.

In March 2017, about five months after Appellant’s bid protest and four months after the City and McCullough entered into a contract for the project, the City and McCullough were served with Appellant’s Ex Parte Application for Temporary Restraining Order, and Petition for Writ of Mandate and Complaint for Declaratory Relief and Injunction.2 Appellant alleged that the bid documents did not comply with California law, and that the City must either rebid the project, or award the contract to Stewart, as lowest bidder, or to Appellant. The trial court denied Appellant’s application for a temporary restraining order, and after additional briefing and oral argument, denied Appellant’s request for preliminary injunction and scheduled an August 15, 2017 hearing on the merits of Appellant’s writ petition. At the hearing, Appellant’s attorney said she needed more time for argument than had been allotted, and the hearing was continued to October 16, 2017. At the October hearing, the court denied the petition, ruling that the City did not abuse its discretion in awarding the contract to McCullough. The trial court declined to rule on the affirmative defense of laches, raised by McCullough and the City, and mootness, raised by the City. McCullough’s attorney submitted a written order, and judgment was entered on November 1, 2017.

The trail construction project that is the subject of this appeal was completed on November 17, 2017, according to the Notice of Completion that the City filed with the Humboldt County Recorder. Appellant’s notice of appeal was filed November 29, 2017.

DISCUSSION

In an appeal from the denial of a petition for writ of mandate that challenges the award of a public contract, “ ‘we perform the same function as the trial court and are not bound by its determinations.’ ” (Eel River Disposal & Resource Recovery, Inc. v. County of Humboldt (2013) 221 Cal.App.4th 209, 224, quoting Schram Construction, Inc. v. Regents of University of California (2010) 187 Cal.App.4th 1040, 1051.) We review the 5 decision of the public entity for substantial evidence, exercising independent judgment if we must decide questions of statutory interpretation or determine whether the entity’s actions are in violation of applicable law. (Ibid.)

2 Stewart was also served but did not appear in the trial court proceedings.

Appellant raises three arguments on appeal. First, Stewart’s low bid was responsive, and therefore the City’s rejection of that bid violated California law. Second, the bid documents “created confusion among bidders,” including confusion as to whether proposals were required to include signed BB-30 Affidavits, and therefore the award to McCullough must be overturned and the project rebid. Third, the bid documents did not include the non-collusion declaration required by section 7106, which states that every bid must include a specified form of declaration. In response, the City argues that the appeal is moot, and further argues the merits, taking the position that it properly awarded the contract to McCullough.

“An appeal is moot when a decision of ‘the reviewing court “can have no practical impact or provide the parties effectual relief.” ’ ” (DeSilva Gates Construction, LP v. Department of Transportation (2015) 242 Cal.App.4th 1409, 1416.) “California law has long recognized that the completion of a public works project moots challenges to the validity of the contracts under which the project was carried out.” (Wilson & Wilson v. City Council of Redwood City (2011) 191 Cal.App.4th 1559, 1575.) The trail project that was the subject of the award at issue in this case was completed in November 2017, and therefore this appeal is moot. Appellant does not dispute this. Instead, Appellant asks us to exercise our discretion to decide the appeal, as we may when the case presents an issue of broad public interest that is likely to recur, when there may be a recurrence of the controversy between the parties, or when a material question remains for our determination. (Cucamongans United for Reasonable Expansion v. City of Rancho Cucamonga (2000) 82 Cal.App.4th 473, 479-480.) We decline to do so.

We note that since November 2016 the City has used the form specified by the current version of section 7106 in its public bid documents, and by June 29, 2017, the City had solicited four bids with its updated bid package. Appellant does not point to anything in the record to suggest any confusion or ambiguity about non-collusion 6 affidavits in connection with any bids since the package was updated. In these circumstances, we cannot say that this case raises an issue that is likely to recur or that material questions remain for our determination.

Because we dismiss the appeal as moot, we do not reach McCullough’s arguments that Appellant lacks standing to maintain this appeal, that Appellant’s petition is barred by laches, and that in any event the City did not abuse its discretion in awarding the contract to McCullough.

DISPOSITION

The appeal is dismissed as moot.

Respondents shall recover their costs on appeal.

 

 

 

Authors

Related posts

Top