Budd v. Board of Com'rs of St. Joseph County
| Citation | 22 N.E.2d 973,216 Ind. 35 |
| Decision Date | 23 October 1939 |
| Docket Number | 27215. |
| Parties | BUDD v. BOARD OF COM'RS OF ST. JOSEPH COUNTY et al. |
| Court | Supreme Court of Indiana |
Appeal from Superior Court, St. Joseph County; J. Elmer Peak judge.
Yeagley & Yeagley, of South Bend, for appellant.
George Sands, of South Bend, for appellee.
Appellant and Haywood Publishing Company were bidders for the Class 1 public printing contract for St. Joseph County for the year 1939. The board of county commissioners awarded the contract to Haywood and appellant sought an injunction as a taxpayer. The amended complaint was in two paragraphs, to each of which the court sustained a demurrer. We are called upon to review that ruling.
The bids were advertised for and received pursuant to § 26-536 Burns' 1933, Sec. 5401, Baldwin's 1934, which provides in part:
The general rule is that public contracts attempted to be entered into pursuant to competitive bidding may be enjoined, at the instance of the taxpayer, where the award is arbitrary, corrupt, or fraudulent. Boseker et al. v. Board of Commissioners of Wabash County, 1882, 88 Ind. 267; Robling et al. v. Board of Commissioners of Pike County et al., 1895, 141 Ind. 522, 40 N.E. 1079. See also section 2759, 6 McQuillin on Municipal Corporations, 2d ed., where the cases relating to the subject are collected. The fact that the taxpayer who brings the action was also an unsuccessful bidder for the contract is immaterial if he is otherwise qualified. Grace v. Forbes, 1909, 64 Misc. 130, 118 N.Y.S. 1062.
Where, however, the board or administrative body is vested with discretionary power to enter into contracts pursuant to competitive bidding as, for example, the right to determine the best or most responsible bidder, as well as the lowest bid, the courts will not disturb an honest exercise of such discretion. This must be true because, as pointed out in Lee v. Browning, 1933, 96 Ind.App. 282, 285, 286, 182 N.E. 550, 551, 'ability and capacity, capital, character, and reputation, competency and efficiency, energy, experience, facilities, faithfulness and fidelity, fraud or unfairness in previous conduct, honesty, judgment, promptness, quality of previous work, suitability to the particular task, are proper elements to be taken into consideration in determining the responsibility of a bidder on public contracts.' In the determination of these factors, courts will not undertake to set up their judgment against the judgment of the responsible administrative agencies.
Appellant's first paragraph of amended complaint proceeds upon the theory that the rejection of his bid and the awarding of the contract to the Haywood Publishing Company was an unlawful exercise of the discretion vested in the board of commissioners. The relevant allegations of this paragraph of the complaint may be briefly summarized as follows: the plaintiff is a taxpayer and brings the action on behalf of himself and all other taxpayers of the county; that the defendant board of commissioners and county auditor caused due notice to be given by publication, as required by law, that on a day named they would receive bids for the different classes of public printing required by said county during the year 1939; that plaintiff held the contract for Class 1 of said printing for the year 1938, and that he submitted his bid for the same class for the year 1939 in the aggregate sum of $4,401.40, accompanied by a good and sufficient surety bond; that said Haywood Publishing Company bid $8,965.40 for the same class; that plaintiff has the financial and physical ability to perform the conditions of his bid and furnish the materials required in accordance with the specifications adopted by said board; that without giving any reason or cause therefor, the board of commissioners rejected the bid of the plaintiff, which was the lowest and best bid submitted to said board for said class, and wrongfully and unlawfully awarded said contract to said Haywood Publishing Company upon its said bid. The paragraph contains a prayer for an injunction against the defendants, restraining them from entering into any contract with respect to the bid of the Haywood Publishing Company, or any other person whose bid was not equally as low and good as that of the plaintiff.
Fraud may be actual or constructive. Constructive fraud is a breach of legal or equitable duty which, irrespective of the moral guilt of the fraud feasor, the law declares fraudulent because of its tendency to deceive others, to violate public or private confidence, or to injure public...
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