LaCorte Elec. Const. and Maintenance, Inc. v. County of Rensselaer

Decision Date22 October 1992
Citation604 N.E.2d 88,590 N.Y.S.2d 26,80 N.Y.2d 232
Parties, 604 N.E.2d 88, 79 Ed. Law Rep. 192 In the Matter of LaCORTE ELECTRICAL CONSTRUCTION AND MAINTENANCE, INC., Appellant, v. COUNTY OF RENSSELAER et al., Respondents.
CourtNew York Court of Appeals Court of Appeals

Hiscock & Barclay, Albany (Robert L. Adams, of counsel), for appellant.

Robert A. Smith, County Atty., Troy (Thomas R. Cioffi, of counsel), for respondents.

OPINION OF THE COURT

BELLACOSA, Judge.

In this dispute involving the award of a public works contract to the "lowest responsible bidder", petitioner-appellant LaCorte Electrical Construction and Maintenance, Inc. (LaCorte), the low bidder, seeks in effect to clear its business name and reputation from the implication that it was not a responsible bidder. The challenged determination of the Hudson Valley Community College (HVCC) Board of Trustees, subsequently approved by the Rensselaer County Legislature as required by Education Law § 6306(7), implicitly rejected LaCorte as a responsible bidder under General Municipal Law § 103 by awarding the electrical contract to the second lowest bidder. The premise for the relief LaCorte seeks is that it was deprived of notice and an opportunity to present its views to the HVCC Board. We hold, under the circumstances and representations of respondent in this case, that LaCorte was denied meaningful and timely opportunity to defend its name and reputation, and we therefore reverse the order of the Appellate Division.

On March 30, 1990, LaCorte, an electrical contractor in Rensselaer County, bid for the subcontract electrical work for the construction of the Edward F. McDonough Health, Physical Education and Recreation Complex to be built on the campus of respondent HVCC. LaCorte's bid was $683,994--$67,732 lower than the next lowest bid submitted by respondent Schenectady Hardware and Electric (SH & E). In the course of evaluating the various bids, officials at HVCC confirmed with the State Department of Labor that in 1987 LaCorte had stipulated to willful violations of the Labor Law for failing to pay the prevailing wage on public projects in 1984-1985. HVCC also confirmed through an Assistant Attorney-General that LaCorte was accused under a 25-count criminal indictment involving extortion, larceny and other crimes stemming from conduct in demanding paybacks after making restitution for the violations of the Labor Law. HVCC was accurately informed that, in accordance with a plea bargain, LaCorte was expected to plead guilty on April 3, 1990 to one class E felony count in satisfaction of the indictment. LaCorte was not contacted to verify the data nor given an opportunity to explain or defend its reputation before HVCC, a procedural step that counsel for respondents forthrightly acknowledges would have been prudent and preferable.

The HVCC Board of Trustees held a regularly scheduled meeting on April 2, 1990. The published agenda for that meeting included consideration of certain bids for the subject building complex. The agenda purposefully did not include the electrical work contract. Shortly after the meeting convened, however, the Board went into executive session to discuss financial, credit and employment histories of the bidding contractors. When the Board reconvened its regular session, it voted to amend the agenda to include a vote on the electrical work contract and, without explanation, awarded it to SH & E as the "lowest responsible bidder". By implication and operation of law, LaCorte was thus deemed to be not a "responsible" bidder (see, General Municipal Law § 103[1]. LaCorte was not present or aware of this development. The next day, LaCorte pleaded guilty to a single class E felony in satisfaction of the indictment. The HVCC Board's contract with SH & E was approved by the Rensselaer County Legislature at its April 11, 1990 meeting (see Education Law § 6306[7]. Though the record reflects that letters were submitted to the Legislature concerning LaCorte's reputation, there is no evidence that LaCorte had any official notice or opportunity to present its position to that body.

LaCorte sued on various grounds to annul the implication of its nonresponsibility and to prohibit or void the award of the contract to SH & E. Its principal attack rests on the failure of HVCC to give it notice and an opportunity to defend its status as a responsible bidder prior to HVCC's award of the electrical contract. Its subsidiary claims are that the implied determination of nonresponsibility is arbitrary and capricious, and that the Board's actions violate the Open Meetings Law (Public Officers Law § 100 et seq.).

Supreme Court dismissed LaCorte's CPLR article 78 petition and the Appellate Division affirmed, with two Justices dissenting (177 A.D.2d 786, 576 N.Y.S.2d 397). This appeal as of right followed. The majority at the Appellate Division relied essentially on Education Law § 6306(7), which requires the County Legislature's approval for the award of the HVCC contracts. The Court reasoned (at 787, 576 N.Y.S.2d 397) that before the Legislature approved HVCC's award, LaCorte "had notice of the concern about its responsibility and the reason for that concern," and that while "the nature of [LaCorte's] opportunity to rebut the charges" prior to the Legislature's vote was "not clearly establish[ed]," LaCorte's due process rights were satisfied by the submission of letters on LaCorte's behalf addressed to the Legislature attesting to its responsibility as an electrical contractor. The dissenting Justices contended that, while the County Legislature's approval of the contract award is required under Education Law § 6306(7), the HVCC Board of Trustees is the entity that undertakes to make the decision and, therefore, LaCorte's due process rights were violated by the HVCC Board's conceded failure to provide LaCorte with any notice and opportunity to present views prior to the Board's consideration of the pertinent bids and its award of the contract. The dissent added that there is no record evidence, in any event, that LaCorte received any notice or opportunity to be heard prior to the County Legislature's consideration of the matter.

This case raises competing concerns regarding the manner in which a government entity deals with prospective contractors. General Municipal Law § 103(1) required that "all contracts for public work involving an expenditure of more than [$7,000] * * * shall be awarded by the appropriate officer, board or agency of a political subdivision * * * to the lowest responsible bidder furnishing the required security after advertisement for sealed bids" (emphasis added). While the protected "liberty" interest in this context has not been precisely defined, it has been given flexible meaning and has been held to include the right to contract (see, Board of Regents v. Roth, 408 U.S. 564, 571-572, 92 S.Ct. 2701, 2706-2707, 33 L.Ed.2d 548, quoting Meyer v. Nebraska, 262 U.S. 390, 399, 43 S.Ct. 625, 626, 67 L.Ed. 1042). Respondents, for purposes of this case, virtually concede that LaCorte has some protected interest, but urge that it was adequately safeguarded.

When a low bidder such as LaCorte has its bid rejected with the inevitable implication of nonresponsibility, its commercial " 'good name, reputation, honor, or integrity is at stake' " (see, Board of Regents v. Roth, supra, at 573, 92 S.Ct. at 2707, quoting Wisconsin v. Constantineau, ...

To continue reading

Request your trial
17 cases
  • Rutigliano Paper Stock v. U.S. Gen. Serv. Admin.
    • United States
    • U.S. District Court — Eastern District of New York
    • June 10, 1997
    ...basis for a determination that [a contractor] is not a responsible bidder." LaCorte Electrical Const. & Maint., Inc. v. County of Rensselaer, 80 N.Y.2d 232, 238, 590 N.Y.S.2d 26, 604 N.E.2d 88 (N.Y. 1992) (citing cases). Thus, the NYCTA's determination could rest solely on the The fact that......
  • Lacorte v. Hudacs, 1:94-CV-402.
    • United States
    • U.S. District Court — Northern District of New York
    • April 19, 1995
    ...of which must be accompanied by notice and an opportunity to respond. LaCorte Electrical Constr. & Maintenance, Inc. v. County of Rensselaer, 80 N.Y.2d 232, 235, 590 N.Y.S.2d 26, 28, 604 N.E.2d 88, 90 (1992). The second federal right violation stems from defendants' alleged defamations of p......
  • HELLENIC AMERICAN ACTION COMMITTEE v. City of NY, 96 Civ. 3185.
    • United States
    • U.S. District Court — Southern District of New York
    • July 31, 1996
    ...of non-responsibility, its commercial "good name, reputation, honor or integrity is at stake." LaCorte Elec. v. County of Rensselaer, 80 N.Y.2d 232, 238, 590 N.Y.S.2d 26, 604 N.E.2d 88 (1992) (citing Board of Regents v. Roth, supra, at 573, 92 S.Ct. at 2707, and quoting Wisconsin v. Constan......
  • Mondello v. New York Blood Center-Greater New York Blood Program
    • United States
    • New York Court of Appeals Court of Appeals
    • October 22, 1992
  • Request a trial to view additional results
7 books & journal articles
  • Public Bidding and Contracts
    • United States
    • James Publishing Practical Law Books Archive New York Fire District Officers' Guide - 2018 Contents
    • August 2, 2018
    ...implication of non-responsibility” for the rejected bidder. Matter of LaCorte Elec. Constr. & Maintenance v County of Rensselaer , 80 N.Y.2d 232, 236 (1992). §8:110.14 INABILITY TO DO THE JOB The requirement that the contract shall be let to the “lowest responsible bidder” does not require ......
  • Public Bidding and Contracts
    • United States
    • James Publishing Practical Law Books Archive New York Fire District Officers' Guide - 2021 Contents
    • August 2, 2021
    ...implication of non-responsibility” for the rejected bidder. Matter of LaCorte Elec. Constr. & Maintenance v County of Rensselaer , 80 N.Y.2d 232, 236 (1992). §8:110.14 Inability to Do the Job The requirement that the contract shall be let to the “lowest responsible bidder” does not require ......
  • Public Bidding and Contracts
    • United States
    • James Publishing Practical Law Books Archive New York Fire District Officers' Guide - 2016 Contents
    • August 16, 2016
    ...implication of non-responsibility” for the rejected bidder. Matter of LaCorte Elec. Constr. & Maintenance v County of Rensselaer , 80 N.Y.2d 232, 236 (1992). Public Bidding and Contracts 8-13 §8:110.19 §8:110.14 INABILITY TO DO THE JOB The requirement that the contract shall be let to the “......
  • Public Bidding and Contracts
    • United States
    • James Publishing Practical Law Books Archive New York Fire District Officers' Guide - 2017 Contents
    • August 13, 2017
    ...implication of non-responsibility” for the rejected bidder. Matter of LaCorte Elec. Constr. & Maintenance v County of Rensselaer , 80 N.Y.2d 232, 236 (1992). Public Bidding and Contracts 8-13 §8:110.19 §8:110.14 INABILITY TO DO THE JOB The requirement that the contract shall be let to the “......
  • Request a trial to view additional results

VLEX uses login cookies to provide you with a better browsing experience. If you click on 'Accept' or continue browsing this site we consider that you accept our cookie policy. ACCEPT