Mississippi State Bldg. Commission v. Becknell Const., Inc.

• Decision Date: 16 March 1976
• Docket Number: No. 48460,48460
• Citation: 329 So.2d 57
• Parties: MISSISSIPPI STATE BUILDING COMMISSION, Appellant, v. BECKNELL CONSTRUCTION, INC. and St. Paul Fire & Marine Insurance Company, Appellees.
• Court: Mississippi Supreme Court

Page 57

329 So.2d 57

MISSISSIPPI STATE BUILDING COMMISSION, Appellant, v. BECKNELL CONSTRUCTION, INC. and St. Paul Fire & Marine Insurance Company, Appellees.

No. 48460.

Supreme Court of Mississippi.

March 16, 1976.

Rehearing Denied April 13, 1976.

A. F. Summer, Atty. Gen. by Donald Clark, Jr., Sp. Asst. Atty. Gen., Jackson, Delos H. Burks, Picayune, for appellant.

Heidelberg, Woodliff & Franks, Sam E. Scott, Jackson, for appellees.

Before PATTERSON, P.J., and ROBERTSON and SUGG, JJ.

PATTERSON, Presiding Justice, for the Court:

The Mississippi State Building Commission brought suit for bond forfeiture against Becknell Construction, Inc. and St. Paul Fire & Marine Insurance Company. The defendants successfully moved to transfer the cause from the Circuit Court of the First Judicial District of Hinds County to the Chancery Court upon equitable defenses. From an adverse decree of the Chancery Court, the Mississippi State Building Commission appeals. We affirm.

In February and March of 1972 the State Building Commission published advertisements for bids for the construction of a classroom building at Jackson State College. The bids were to be finally accepted on March 21, 1972, at 2:00 p.m. Included in the bid process was the requirement of a certified check or acceptable bid bond in an amount equal to five percent (5%) of the base bid. This security for serious bidding was to be forfeited as liquidated damages by the successful bidder who failed or declined to execute a contract in accordance with his bid.

Henry Osborn compiled Becknell's bid on the Jackson State building. He completed the figures and filled in the base price, in numbers and words, on the bid form while being driven to the Woolfolk State Office Building on March 21, 1972, just prior to 2:00 p.m. After the bids were submitted he remained in the office of the building commission until all of the bids were opened and copied the amount of each as they were announced. After hearing Becknell's bid read aloud, he realized, in accord with his testimony, the bid was one hundred thousand dollars ($100,000) less than intended due to his erroneous transposition of figures from his work sheet to the bid form while enroute from his place of employment to the State Office Building. He immediately called Becnkell, his superior, and informed him of the alleged mistake.

Becknell checked Osborn's bid estimates and called James G. Chastain, the Executive Director of the Mississippi State Building Commission, and notified him of the mistake the same day. At 8:00 o'clock the next morning W. H. Fanning, Jr., a vice-president of Becknell, met with Chastain in the director's office and delivered a letter to him in explanation of the mistake on the bid form, as well as a copy of the estimate work sheet. He also inquired if a meeting with the State Building Commission was necessary to explain the mistake and was advised that the meeting was not essential. The essence of the letter was, 'The correct amount of the bid was, to have been $2,219,500.00, however, in transposing it was written in as $2,119,500.00. After your careful study of the documents presented with this letter, we will certainly appreciate your consideration in granting our request to withdraw our bid without penalty.'

Chastain was unable to reconcile the figures of the work sheet to the sum of the bid. The commission, therefore, awarded the contract to Becknell at its next regular meeting without requesting an explanation of the figures from Osborn or others.

Becknell refused the contract and it was thereafter awarded to the second lowest bidder, and this action was instituted for recovery on the bond. As amentioned, a motion to transfer to the chancery court was filed and at that time another work sheet of Osborn, the bid estimator ofBecknell, was placed into evidence. Its figures are somewhat different from those on the work sheet that was attached to the letter previously delivered to the building commission. We observe also that during the course of the trial a third work sheet was placed in evidence. It also differed from the other work sheets. The discrepancies in the work sheet figures, however, were not made the basis for charging fraud against Becknell and, indeed, in response to an interrogatory the commission concedes that lack of good faith has not been charged, and succinctly sets forth the state's position. It follows:

34. State the reasons and circumstances that led the State Building Commission to concude Becknell was not acting in good faith and exercising ordinary care.

34. Lack of good faith has not been charged. It has been the position of the State Building Commission throughout this controversy that, once a bid that is legal on its face has been tendered, received and opened, and in the absence of statutory authority, it would be unlawful for the State Building Commission to permit a contractor to alter or amend its bid or to be permitted to withdraw the same.

The cancellor found that an honest mistake had been made in the bid. The language below expressed his views:

. . . In this cause, there has been no attack whatsoever on the reputation or honesty or integrity of the Defendant Becknell Construction, Inc. or the Defendant St. Paul Fire and Marine Insurance Company, or any of its officers, agents or personnel, which leaves only the idea that if an error was made, it was an honest mistake.

The commission's bill of complaint was dismissed, and the bid bond filed by Becknell was cancelled in accord with the prayer of the cross-complaint of the respondents.

It is contended that the trial court erred by substituting its judgment for that of the State Building Commission in determining the lowest and best bid was not that of Becknell. The commission cites Parker Bros. v. Crawford 219 Miss. 199, 68 So.2d 281 (1953), wherein it is held that public boards are vested with a sound discretion in determining who is the 'lowest and best bidder,' and their decision, when based on an honest and reasonable exercise of the vested discretion will not be interfered with by the courts. We adhere to this principle, and when the discretion is properly exercised, the courts will not interfere with the judgment of a public board.

We note, however, that the building commission did not formally meet or otherwise afford Becknell an opportunity to explain the work sheet, or sheets, antecedent to its bid. It was aware that inquiry had been made to this end and Chastain, executive director of the commission, had advised Becknell that an appearance was unnecessary. The commission, though promptly notified of the claimed mistake, had before it only the letter of Becknell and the first unexplained work sheet when the contract was awarded. We are not persuaded by the appellant's argument that the trial court was substituting its judgment for the State Building Commission when it declined to impose the liquidated damage feature of the bond for Becknell's declination of the contract. The court was not sitting on appeal to review an administrative order or finding and hence was not restricted to the confines of the record evidence, the bid, the letter characterizing the mistake and the figures of the first work sheet, as was the commission. It was sitting as a trial court in a suit instituted by the commission to determine on the merits from the evidence before it whether Becknell's claim of honest mistake was reasonable and justified. It had evidence before it in dismissing the commission's suit that was not before the commission at the time it awarded the contract. These circumstances, in our opinoin, do not support the argument of substitution of judgment as contended by the appellant.

The appellant next contends that the negligence of Becknell caused the mistake and thereby established its liability under the bond. Osborn claimed to have made the error in transposing the figures from the work sheets to the bid document. He testified in part:

Q. What you'd claim to this court now to be a mistake really was a little bit of carelessness, wasn't it?

A. It could be construed as stupidity or carelessness or even negligence, if we so elected to use those terms, because of my thirty years I have only had one other occasion of this in my life span.

Hunt v. Davis, 208 Miss. 710, 45 So.2d 350 [1950], citing Wall v. Wall, 177 Miss. 743, 171 So. 675 (1937), is urged in support of this point. We there stated:

. . . (M)istake 'to constitute equitable relief, must not be merely the result of inattention, personal negligence, or misconduct on the part of the party applying for relief.' (208 Miss. at 725, 45 So.2d at 352).

Hunt arose from a dispute on the quantity of mineral acres intended to be purchased by one litigant and sold by the other. Wall sought to reform a deed to accord with the alleged intention of the parties. The rule announced in Hunt through Wall is undoubtedly correct. Its application, however, is not always mandated, but must be judged from the particular factual circumstance before a court. More apropos to the present situation is the rule found in Terre Haute Cooperage, Inc. v. Branscome, 203 Miss. 493, 35 So.2d 537 (1948), wherein we held, in a suit for the rescision of a timber deed, that equity will grant appropriate relief for a unilateral mistake in proper cases.

We find persuasive State Highway Commission v. State Construction Co., 203 Or. 414, 280 P.2d 370 (1955), a case concerning similar facts to the present, in which equity prevailed. It states:

'But where the mistake is of so fundamental a character, that the minds of the parties have never, in fact, met; or where an unconscionable advantage has been gained, by mere mistake or misapprehension and there was no gross negligence on the part of the plaintiff, either in falling into the error, or in not sooner claiming redress; and no intervening rights have accrued; and the parties may still be placed in statu quo; equity will...