Foster v. Honolulu Construction & Draying Co.

OPINION OF THE COURT BY

DE BOLT, J.

(Perry, X, Dissenting)

The complainants, H. H. Foster and Edward Ross, filed their bill in equity praying for an injunction to restrain the superintendent of public works from signing or approving any vouchers for work done, or material* furnished under a certain contract with the respondent, Honolulu Construction and Draying Company, Limited (hereinafter called the “Construction Co.”), for constructing certain streets and laying storm drains in the Auwaiolimu tract in Honolulu, and to restrain the auditor from issuing any warrants in payment of any work done, or material furnished under the contract, and to restrain the Construction Co. from receiving any money under the contract.

The averments of the bill, so far as they are material in the consideration of the questions presented, are, that the complainants are citizens and taxpayers of the Territory; that they instituted this suit as such citizens and taxpayers for themselves and on behalf of all other taxpayers of the Territory; that the superintendent of public works duly advertised for “sealed tenders” for constructing the streets and laying the storm drains mentioned, thereby giving notice that “plans, specifications and blank forms of proposals are on file in” his office, and that he “reserves the right to reject any or all tenders;” that in response to the advertisement thus made five contractors, including the complainants and the Construction Co., filed in the office of the superintendent of public works their respective bids or proposals' for performing the work and furnishing the material required by the plans and specifications; .that copies of the plans, specifications and blank forms for proposals are annexed to the bill and made a part thereof.

In the blank forms for proposals to perform the work and furnish material there are five columns for bids, one of which forms, as filled out by the complainants respecting the unit prices and total stuns bid, and which they filed as their proposal, reads:

“The following are unit prices for the items named in place complete with the gross sum for which the work specified will be performed:

Item Approximate Items Unit Bid Total

No. Quantities :

1 Clearing $ 300.00.

2 24,848 cu. yds. Excavating at 60 cents $14,908.80

3 1,338 cu. yds. Rubble Masonry Wall at $5.00 ’ $ 6,690.00

■ 4 23,435 sa. yds. Crowning Roadway at .05 cents $ 1,171.75

5 1,842 lin. ft. Guard Wall at 75 cents $ 1,381.50

6 455 lin. ft. (12" Concrete Pipe Line complete in place) at 10 cents ? 455.00

7 7 Brick Inlets, complete in place at $35.00 $ 245.00

8 122 lin. ft. Rubble Masonry Guard Wall for intersecting streets at 75 cents $ 915.00

Total for wbicb work will be performed $26,067.05”

The complainants agreed to complete the work in 150 working days after official notice of the award. The proposal of the Construction Co. was in due form and regular in all respects. The total for which it proposed to perform the work being $26,745.20, and to complete the work in 140 working days after official notice of the award. There being ten days difference in the time within which the complainants and the Construction Co. respectively agreed to complete the work, the superintendent of public works under the specifications hereinafter quoted, was authorized to add to the complainants’ bid the sum of $100, thus making the total amount of their bid $26,167.05.

The superintendent of public works finding the bid of the complainants “irregular,” and acting upon the opinion of the attorney-general of the Territory, rejected it and awarded the contract for the work and material in question to the Construction Co., the next lowest bidder but one whose proposal was also rejected, having failed to name any unit bid whatsoever.

The following provisions off the specifications are deemed pertinent:

“The estimated quantities on these plans and specifications are made for the convenience of the contractor and the Department of Public Works does not assume any responsibility as to the exactness of the same. The contractor will name a lump sum bid for the total work and it will be assumed that his bid is based on a thorough knowledge of the existing conditions and the amount and kind of work to be performed.

“All tenders shall be on blank forms furnished by the Department of Public Works; all terms and conditions of which are made a part hereof.

“The Superintendent of Public Works reserves the right to increase or diminish the work as shown on plans and described in these specifications; and in snch cases shall add to or deduct »from the contract price, as the case may be, the value of such additions or deductions, based on the schedule filed with the contractor’s tender, or on the unit price in tender.

“The Superintendent of Public Works in determining who is the lowest bidder under these specifications, will consider the difference in time as proposed for the completion of the work by the contractor at the rate of $10.00 per day.”

There is no allegation of fraud or abuse of discretion.

The bill prayed for a temporary injunction pending proof and for a perpetual injunction on final hearing. The circuit judge declined to grant the temporary injunction as prayed for, but made an order directing the respondents to appear and show' cause, if any they had, why a temporary injunction should not be granted. In compliance with this order the respondents made their so-called returns, which, in effect, were demurrers to the bill, and were so treated by court and counsel. The returns were held to be a complete showing on the part of the respondents to the order to show cause, and a decree was thereupon entered dismissing the bill. From this decree the complainants appeal. The case, therefore, is before the court on the pleadings, no evidence having been adduced.

The superintendent of public works, as will be observed, required the bidders to submit both a unit bid and a total bid on each item of work to be done, or material to be furnished. This was not only a reasonable and proper requirement, but, under certain contingencies which it is not unreasonable to assume might arise, was a requirement of considerable importance. For instance, had the proposal been accepted, assuming for the moment that a contract could be founded upon it, and the superintendent of public works had wished to exercise his right under the specifications to either increase or diminish the work; an important question would then have arisen, namely, Shall the value of such addition to or deduction from the work be based upon the unit bid or upon the total bid? Obviously, assuming the total bids to be correct, if a deduction were to be made in the proposed work it would be to the advantage of the bidder to base the value of such deduction as regards items 6 and 8, upon the unit bids, and, likewise, it would be to the advantage of the Territory to base the value upon the unit bids if an increase in the work should be made. With correct unit bids this question could not arise.

The proposal upon its face presents a question of doubt and uncertainty, both as to the unit bid and the total bid on each of the items mentioned. The question is not merely technical, but it is one of substance. Taking item 6; it is uncertain whether the complainants intended to bid on the 455 lineal feet of pipe drain at the rate of ten cents per foot, making a total of $45.50, or one dollar per foot, making a total of $455. And as to item 8 the same uncertainty exists. Whether the complainants intended to bid on the 122 lineal feet of wall at the rate of seventy-five cents per foot, making a total of $91.50, or $7.50 per foot, making a total of $915, cannot be determined from the proposal before the court. Hence, it is clear that the proposal did not comply with the requirements of the call for tenders. Act 62, Laws of 1909, provides that “All bids which do not comply with the requirements of the cqll for tenders shall be rejected.”

There can be no legitimate question, either as to the authority, or as to the propriety, of the superintendent of public works in requiring each bidder to submit both a unit bid and a total bid on each itera of the work to be performed or material to be furnished. It was clearly within his powers to hold as he did that the requirements as to the unit and total bids had not been complied with by the complainants in their proposal as to items 6 and 8, and to reject their bid. Lord v. Supt. Pub. Works, 16 Haw. 437, 441; In re Marsh, 83 N. Y. 431, 435; Weed v. Beach, 56 How. Pr. 470; State v. N. Y. Co. Comrs., 13 Neb. 57.

Counsel for the complainants are not in accord as to the unit bids in question. While one of them contends that there is no error in this regard, the other contends that the unit bids of ten cents and seventy-five cents as stated in the proposal are palpable errors and that it is within the power, of the court to read into the proposal what he terms the correct unit bids, namely, one dollar as to item 6 and $7.50 as to item 8. These conflicting views of counsel, however, tend rather to increase the uncertainty. I doubt the propriety as well as the power of the court to undertake to correct the proposal at this time. Reading into a proposal new or additional terms is quite a different proposition from that of construing a contract. This distinction as between a mere proposal and a contract clearly distinguishes the authorities cited by counsel upon this question from the case at bar. To permit a substantial change in a proposal of the character in question, after the other bids have been opened and made public, would be contrary to public policy, and would tend to open the door to fraudulent and corrupt practices.

J. Lightfoot and H. G. Peters for complainants.

The proposal, however viewed, presents a question of doubt and uncertainty as to the bidder’s intention. Doubt or uncertainty is incompatible with agreement. To result in a contract, the offer must be certain. No contract can be founded upon uncertainty; and if a contract could not be founded upon the . proposal in question because of its uncertainty (9 Cyc. 249), it follows that the proposal was properly rejected. If the proposal, either as to the unit bid, or as to the total bid, is not what the complainants intended, obviously, an acceptance of it in that form would not satisfy the law as to the essential elements of a contract. Moffett, Hodgkins & Co. v. Rochester, 178 U. S. 373. Such a proposal and acceptance thereof would be lacking in mutuality. It would be a mutual mistake. If, to illustrate a mutual mistake, the owner of a horse offers it to an intending purchaser for $165, and the latter, understanding the price to be $65, takes the horse, the minds of the parties do not meet, there is no sale, and the title does not pass. Rupley v. Daggett, 74 Ill. 351.

The decree appealed from is affirmed.

A. L. Castle and J. T'7. Cathcart (Castle & Withington on the brief) for the Construction Co.

Wade Warren Thayer, Attorney General, for the Superintendent of Public Works and Auditor of the Territory.