The New Jersey Superior Court, Appellate Division, recently
reaffirmed that the New Jersey Local Public Contracts Law (the
LPCL) requires bidders to file written challenges to bid
specifications three days before the bids
are opened or be precluded from challenging those specifications in
a subsequent proceeding related to the bid award.
In an unpublished decision, Sajo Transport, Inc. v. The Village
of Ridgewood, A-4121-11T3 (App. Div. May 20, 2013), the
Appellate Division reviewed the Village of Ridgewood's contract
award pursuant to the LPCL. Sajo Transport submitted the low bid in
response to Ridgewood's request for proposal (RFP) for landfill
disposal of solid waste, which would be transported by
Ridgewood's solid waste vehicles. The RFP required that a
bidder's landfill site be within a 15-mile radius of the
contracting authority's site and requested supporting
documentation in the form of MapQuest "driving
directions" between the two locations. Sajo's proposal,
however, neglected to provide the requested MapQuest directions and
instead substituted another website that calculated the distance
between the two locations "as the crow flies" - not the
over-the-road distance. When Sajo's bid was rejected as
nonconforming and the contract awarded to another bidder, Sajo
filed an action in lieu of prerogative writs, arguing that it was
entitled to award of the contract because it was the low bidder and
its facility was within 15 miles of the contracting authority's
location (although not pursuant to MapQuest driving directions as
specified in the RFP).
The Appellate Division concluded that the 15-mile radius
requirement - accompanied by supporting MapQuest driving directions
- was directly related to the purpose of the RFP, since
Ridgewood's vehicles would need to travel that distance. The
Appellate Division therefore dismissed Sajo's complaint with
prejudice, holding that Sajo lacked standing to challenge either
the 15-mile radius requirement or the MapQuest driving directions
requirement, because Sajo had failed to challenge either
requirement before the bids were opened. The Appellate Division
reiterated that NJSA 40A:11-13 requires:
Any prospective bidder who wishes to challenge a bid specification shall file such challenges in writing with the contracting agent no less than three business days prior to the opening of the bids. Challenges filed after that time shall be considered void and having no impact on the contracting unit or the award of a contract. [emphasis added]
The Appellate Division characterized this provision's function as a "statute of limitations" that "serves to time-bar Sajo's legal theories based upon a challenge to Ridgewood's specifications." The Appellate Division's decision serves as a reminder to companies submitting bids under the LPCL that bid specifications must be carefully scrutinized - and any potential challenges raised with the contracting authority - before bids are opened. Failure to do so precludes challenges from being raised after a bid award, and a low bidder can easily find itself shut out of a contract. In many cases, bid proposals are created and submitted in a short time frame, but potential bidders must be vigilant in raising any concerns or challenges to the bid requirements in timely fashion and within the strict time limits set forth in the LPCL or other RFP documents.
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