Demory Bros., Inc. v. Board of Public Works of Maryland

• Decision Date: 18 December 1974
• Docket Number: No. 41,41
• Citation: 329 A.2d 674,273 Md. 320
• Parties: , 76 Lab.Cas. P 53,543 DEMORY BROTHERS, INC., et al. v. BOARD OF PUBLIC WORKS OF MARYLAND et al.
• Court: Maryland Court of Appeals

Page 320

273 Md. 320

329 A.2d 674, 76 Lab.Cas. P 53,543

DEMORY BROTHERS, INC., et al. v. BOARD OF PUBLIC WORKS OF MARYLAND et al.

No. 41.

Court of Appeals of Maryland.

Dec. 18, 1974.

Herman M. Braude, Rockville (Gary L. Brooks, Sadur, Pelland, Braude & Caplan, Chartered, Rockville, on the brief), for appellants.

David C. Hjortsberg, Asst. Atty. Gen. (Francis B. Burch, Atty. Gen., on the brief), for Board of Public Works of Maryland.

Argued before SINGLEY, SMITH, DIGGES LEVINE and O'DONNELL, JJ., and EUGENE MACKALL CHILDS and ROBERT F. SWEENEY, Special Judges.

SWEENEY, Special Judge.

In this case we are asked to decide whether the provisions of the 'Prevailing Wage Law' are applicable to a public school construction contract in Prince George's County.

The 'Prevailing Wage Law' was adopted by the General Assembly by Chapter 558, Laws of Maryland, 1969, and became effective on July 1, 1971. The act requires every public body authorized to contract for public works to request the Commissioner of Labor and Industry to determine the prevailing rates of wages and fringe benefits for workmen in the locality in which the work is to be performed, and the act further makes it mandatory upon the contractor to whom the contract is awarded and all sub-contractors under him to pay the specified rates to all workmen and apprentices employed by them in the execution of the contract.

The 'Prevailing Wage Law' has been amended twice. ¹ As originally enacted, the law specified that its provisions need not be applicable to construction projects entered into by State agencies funded primarily from sources other than the State, nor to construction contracts entered into by a county or municipal corporation, or a department, officer, board, commissioner, or agency thereof. By Chapter 220 of the Laws of Maryland, 1971, however, this portion of the law was amended, and it now provides, in pertinent part (Annotated Code of Maryland, Article 100, Section 96):

'(b) 'Construction' includes all construction, reconstruction, improvement, enlargement, painting and decorating, alteration, maintenance or repair.

'(c) 'Public Works' includes all buildings, bridges, roads, streets, alleys, ditches, sewage disposal plants, waterworks, and all other structures or works, constructed for public use or benefit or paid for wholly or in part out of public funds, except work done by any public utility company pursuant to order of the Public Service Commission or other public authority, whether or not done under public supervision or direction or paid for wholly or in part out of public funds, unless let to contract provided, however, that for the purposes of this subtitle contracts of less than $500,000 shall be excluded.

'(d)(1) 'Public body' means the State or any department, officer, board, commission, agency or instrumentality of the State, and shall include any other agency, political subdivision, corporation, person or entity of whatever nature when State public funds are the only funds used for the construction of a particular public works, but, except when made applicable pursuant to the provisions of paragraph (2) of this subsection, this term shall not mean any State agency or instrumentality funded wholly from sources other than the State, nor shall it mean any county or municipal corporation, or any department, officer, board, commission, or agency thereof, when funds other than State funds are used either in whole or in part for the construction of public works.

(2) The governing body of any political subdivision of this State may provide by resolution or ordinance that the political subdivision shall be covered by this subtitle and included within the scope of its provisions and any such political subdivision shall constitute a 'public body' within the meaning of this subtitle when the commissioner is notified in writing by the governing body that such action has been taken.' (Emphasis supplied.)

Effective July 1, 1971 the State of Maryland undertook to pay the costs of all public school construction projects approved by the Board of Public Works. Chapter 624 of the Laws of Maryland, 1971. That act, and rules and regulations subsequently adopted by the Board of Public Works pursuant to the act, established procedures for the review and approval of school construction projects submitted by the boards of education of the counties and Baltimore City. On July 12, 1972, the Board of Education of Price George's County issued invitations for bids on the construction of an addition and alterations to the Eugene Burroughs Junior High School. Initially those invitations were issued without reference to the 'Prevailing Wage Law'. Approximately one month later, however, the Board issued an addendum to the invitation, requesting each bidder to submit two separate bids; one to be applicable if 'prevailing wage' rates were required to be paid on the project, and the other bid to be applicable if those rates were not required to be paid. Demory Brothers, Inc. (Demory) an appellant herein, submitted the low non-prevailing wage bid, in the amount of $1,090,500.00. Demory's alternate bid, using the 'prevailing wage' rate, was $1,155,930.00. This was not the low bid submitted under the 'prevailing wage' alternative, as a competing firm, Gardiner and Gardiner, Inc. (Gardiner), submitted the low bid in that category in the amount of $1,103,000.00. If the 'Prevailing Wage Law' was not applicable to the project, therefore, Demory was the successful bidder; if, however, the provisions of the 'Prevailing Wage Law' were applicable, Gardiner was the successful bidder.

The Prince George's County Board of Education requested the Interagency Committee for State Public School Construction ² to approve the award of the contract to Demory. That request was refused, whereupon the Board of Education requested approval of the Gardiner bid, which approval was granted. The contract with Gardiner was subsequently approved by the Board of Public Works.

The action of the Interagency Committee in rejecting the Demory bid and approving the Gardiner bid was tantamount to a holding by the Committee that the 'Prevailing Wage Law' was applicable to projects built under the State School Construction Program, by virtue of the provisions of Section 96(d)(1) of Article 100.

After the award of the contract to Gardiner, Demory instituted suit in the Circuit Court for Prince George's County, asking that the contract be declared null and void and that the Board of Education be ordered to award the contract to Demory. The Bill of Complaint alleged that the 'Prevailing Wage Law' was not applicable to the State School Construction Program in general, or to this contract in particular. Joining Demory as plaintiffs were the Metropolitan Washington Chapter of Associated Builders and Contractors, Inc., the Associated Builders and Contractors of Maryland, Inc., and Charles W. Demory, Jr., individually. Named as defendants were the Board of Public Works for the State of Maryland, the Board of Education of Prince George's County, and Carl W. Hassel, in his official capacity as Superintendent of Schools of Prince George's County.

The case was tried before Chief Judge Ralph W. Powers in the Circuit Court for Prince George's County on a stipulation of facts, and Judge Powers entered a decree in which he denied the relief requested by Demory. Demory then appealed to the Court of Special Appeals, which affirmed the judgment. Demory Brothers v. Bd. of Pub. Works, 20 Md.App. 467, 316 A.2d 529 (1974). Because the question is one of substantial interest throughout the State, we granted certiorari to review that decision.

The attack on the rejection of the Demory bid is two-pronged. The Appellants first argue that the provisions of the 'Prevailing Wage Law' are not applicable to the public school construction program in general. Secondly, they argue that even if the 'Prevailing Wage Law' is in any way applicable to public school construction programs, it is not applicable to this particular contract, since, in their view, State public funds were not the only funds used for the construction of this school.

It is clear and unmistakable that the General Assembly intended that the Public School Construction Program should be administered in conjunction with the 'Prevailing Wage Law'. In reaching this determination, we rely on two primary factors. The first is that on October 17, 1972, the Attorney General rendered an opinion to the Executive Director of the Public School Construction Program, holding that the 'prevailing Wage Law' was applicable to a public school construction project. At the next following session of the General Assembly, legislation was introduced which would have specifically excluded all contracts for public school construction, additions, or alterations from the provisions of the 'Prevailing Wage Law' (Senate Bill 369, 1973). This Bill failed, not once, but twice. It failed of passage initially by a vote of 22 to 18, with three Senators abstaining. On reconsideration, it failed by a tie vote of 21 to 21, with one Senator not voting. Although we have never held that the amendment-rejection theory is a completely determinative method of ascertaining legislative intent, we have indicated that such action strengthens the conclusion that the Legislature did not intend to achieve the results that the amendment would have achieved, if adopted. In Bosley v. Dorsey, 191 Md. 229, 240, 60 A.2d 691, 696 (1948), for example, we indicated that the rejection by the Senate of a bill that would have authorized the People's Counsel to appeal decisions of the Public Service Commission '. . . strengthens the conclusion that the Legislature has not intended that the People's Counsel shall appeal from orders of the Commission.' See also Madden v. Brotherhood and Union of Tr. Employees, 147 F.2d 439 (4th Cir.) (1945); Safeway Stores v. Bowles, 145 F.2d 836 (Emer.Ct.App.) cert. denied 324...