Legal Question in Construction Law in Florida

Re: Value-Engineering Negotiations

Typical problems regarding bids stem from: Is the bid an offer (as it customarily is) or is the bid the acceptance of the owner's offer (the invitation to bid)? Has the offer been accepted? What should be included in the bid? Was there a mistake? Is the bid responsive? Can a bid be rejected because of concern over the bidder's responsibility?

A contractor or subcontractor may invest significant time and money in preparing a bid. In some instances if there is disregard or wrongful use of that bid without the award of a contract (with loss of the profit expected to come out of that contract), a contractor or subcontractor may have recourse. Should a bid be accepted and the bidder then refuses to enter into a contract in accordance with the bid, there may also be legal relief. On the other side of the fence, a bid may be given to an owner or contractor, on which bid the owner or contractor relies to its detriment, and then the bidder reneges on the bid and refuses to enter into a contract. There may also be relief in that instance.

Construction contracts with the state, counties, or public agencies are most often secured by competitive bidding. There is a great public interest in ensuring that contracts be awarded to effectuate the intent of the competitive bidding laws. The purpose of competitive bidding is to secure the lowest responsible offer. A public authority has wide discretion in the award of public works contracts. The discretion may not be arbitrary or capricious, and must be exercised based on clearly defined criteria. Arbitrary and capricious acts have been defined as acts taken with improper motive, without reason or for a reason that is merely a pretext. Whether the procurement is done through competitive bidding, or by another method, will be determined by the public authority securing the work. The state public authorities are given direction on which method of procurement to use by statute. For example, in the absence of emergency, construction work for the State Department of Transportation must be procured by low bid, unless the project is design/build. The authority for the Florida Department of Management Services to enter into negotiated contracts, design-build contracts, or competitively bid contracts is found in Rules promulgated pursuant to Florida Statute 255.29. Contracts for construction for the Florida School Boards are to be procured by competitive bid, design-build pursuant to the consultants' competitive negotiation act, program management, or day-labor contracts for projects under $200,000.

If you need additional help you may contact the undersigned during normal business hours.

Yours truly,

Randall Gilbert