Sayer v. Minn. Dep't Of Transp., No. A08-1584
| Decision Date | 28 October 2010 |
| Docket Number | A08-1994.,No. A08-1584 |
| Citation | 790 N.W.2d 151 |
| Parties | Scott SAYER, et al., Appellants, v. MINNESOTA DEPARTMENT OF TRANSPORTATION, Respondent, Flatiron-Manson, Respondent. |
| Court | Minnesota Supreme Court |
OPINION TEXT STARTS HERE
COPYRIGHT MATERIAL OMITTED.
Syllabus by the Court
The contract awarded for the construction of the new Interstate 35W bridge across the Mississippi River in Minneapolis did not violate Minn.Stat. § 161.3426, subd. 1(a) (2008).
Dean B. Thomson, Jeffrey A. Wieland, Fabyanske, Westra, Hart & Thomson, P.A., Minneapolis, MN, for appellants.
Lori Swanson, Attorney General, Richard L. Varco, Jr., Assistant Attorney General, St. Paul, MN, for respondent Minnesota Department of Transportation.
Thomas J. Vollbrecht, Faegre & Benson, LLP, Minneapolis, MN, for respondent Flatiron-Manson.
Robert J. Huber, Leonard, Street and Deinard, P.A., Minneapolis, Minnesota, for amicus curiae Associated General Contractors of Minnesota.
On August 1, 2007, the Interstate 35W (I-35W) highway bridge spanning the Mississippi River in Minneapolis collapsed killing 13 people and injuring many others. To replace the bridge, one of the most heavily traveled in the state, respondent Minnesota Department of Transportation (MnDOT) elected to use the relatively new design-build best-value bidding process to choose the new bridge's design and contractor.
See Minn.Stat. §§ 161.3410-.3428 (2008). Respondent Flatiron-Manson was declared the winning bidder and its proposal to rebuild the bridge was accepted. Appellants Scott Sayer and Wendell Phillippi brought an action as private attorneys general under Minn.Stat. § 8.31, subd. 3a (2008), challenging the bidding process and claiming that MnDOT's contract with Flatiron-Manson was illegal. Specifically, appellants claim that MnDOT failed to apply the proper test for responsiveness and that Flatiron-Manson's proposal was not responsive to the request for proposals (RFP) and instructions to proposers issued by MnDOT. The district court concluded that the common law definition of “responsiveness” does not apply to the design-build best-value bidding process and that the determination of the Technical Review Committee that Flatiron-Manson's proposal was responsive was within the Technical Review Committee's discretion. The court of appeals affirmed. Because we conclude that Flatiron-Manson's bid was responsive to the RFP and the instructions to proposers, we affirm.
Three days after the I-35W bridge collapse, MnDOT began the process of replacing the bridge. MnDOT's Commissioner elected to evaluate proposals for the bridge-construction contract using a design-build best-value procurement process instead of the traditional lowest responsible bidder procurement process. As required by the design-build best-value procurement process, the Commissioner issued a request for qualifications to contractors interested in undertaking the design and construction of the bridge. See Minn.Stat. § 161.3420, subd. 3. After five qualifying contractors were identified, the Commissioner sent each qualifying contractor an identical RFP containing detailed project-specific requirements. See Minn.Stat. § 161.3422. The Commissioner subsequently issued instructions to proposers that described the weighted criteria by which proposals would be evaluated, and informed bidders that only bids meeting the standards established by MnDOT would be evaluated. See Minn.Stat. § 161.3422(2). The Commissioner appointed a six-member Technical Review Committee to evaluate the proposals. See Minn.Stat. § 161.3420, subd. 2.
Four contractors-C.S. McCrossan, Ames-Lunda, Flatiron-Manson, and Walsh-American Bridge-submitted proposals to MnDOT. After reviewing the proposals, the Technical Review Committee submitted to the Commissioner the technical scores it assigned to each proposal. The technical scores were accompanied by an itemized list of each proposal's score on the categories described in the instructions to proposers, with detailed comments for each score. Flatiron-Manson's proposal received the highest technical score: 91.47 out of 100 possible points. The next highest score, 67.88 out of 100, was awarded to Walsh-American Bridge's proposal. MnDOT determined the adjusted scores for the proposals by applying the formula set out in Minn.Stat. § 161.3426, subd. 1(c), which in this case required it to multiply the number of days proposed to complete the project by a “Road User Cost” of $200,000 per day, add that product to the contractor's bid, and divide the result by the proposal's technical score. Although Flatiron-Manson had the highest price and was tied with another bidder for the longest period needed to complete the construction of the bridge, its high technical score yielded the lowest adjusted score, constituting the “best value”; thus, Flatiron-Manson was awarded the contract.
Appellants sued, seeking both injunctive and declaratory relief based on their claim that Flatiron-Manson's proposal was not responsive to the RFP and instructions to proposers and should have been rejected, and therefore the contract awarded to Flatiron-Manson was illegal. According to appellants, Flatiron-Manson's proposal was not responsive to the RFP because it failed to comply with a number of the RFP's specifications, only two of which are at issue before us: first, that “[p]roposed work for this project shall not include additional capacity or Right of Way” and, second, that concrete-box designs feature “[a] minimum of three webs.”
Appellants first moved for a temporary restraining order on October 31, 2007, which the district court denied. 1 On July 16, 2008, appellants moved for a temporary injunction to prevent MnDOT from incurring additional costs or expenses under the contract while their claims were being litigated. On that same date, Flatiron-Manson moved for summary judgment seeking denial of appellants' claims for injunctive relief and dismissal of appellants' claims for declaratory relief. In separate orders, the district court denied appellants' motions for injunctive and declaratory relief and granted summary judgment to MnDOT and Flatiron-Manson, dismissing appellants' claims for declaratory relief. In doing so, the district court rejected appellants' argument that the Technical Review Committee should have used the traditional common law definition of “responsive” to evaluate Flatiron-Manson's proposal. Instead, the district court concluded that, under the design-build best-value procurement process, whether a proposal is responsive to the RFP “is a product of the scoring methodology” rather than the “proposal's strict conformity with each and every requirement of the RFP.”
Appellants' separate appeals from the district court's orders were consolidated at the court of appeals, which affirmed. The court of appeals held that the common law definition of “responsiveness” does not apply to the design-build best-value procurement process and that the Technical Review Committee acted within its discretion when it determined that Flatiron-Manson's proposal was responsive. Sayer v. Minn. Dep't of Transp., 769 N.W.2d 305, 310-11 (Minn.App.2009). We granted appellants' petition for review.
“On appeal from a grant of summary judgment, we must determine whether any genuine issues of material fact exist and whether the district court erred in its application of the law.” Patterson v. Wu Family Corp., 608 N.W.2d 863, 866 (Minn.2000). When there are no disputed issues of material fact, we review de novo whether the district court erred in its application of the law. Kelly v. State Farm Mut. Auto. Ins. Co., 666 N.W.2d 328, 330 (Minn.2003).
Traditionally, Minnesota public construction contracts have been awarded using the lowest responsible bidder approach to procurement. Dean B. Thomson, et al., A Critique of Best Value Contracting in Minnesota, 34 Wm. Mitchell L.Rev. 25, 26 (2007); see also Foley Bros., Inc. v. Marshall, 266 Minn. 259, 262, 123 N.W.2d 387, 389-90 (1963); Griswold v. Ramsey Cnty., 242 Minn. 529, 533, 65 N.W.2d 647, 650 (1954); Coller v. City of Saint Paul, 223 Minn. 376, 378, 26 N.W.2d 835, 836-37 (1947). That approach requires a public agency to choose a design and release specifications for that design to contractors for bidding. Minn.Stat. § 161.32, subd. 1b (2008); Coller, 223 Minn. at 378, 26 N.W.2d at 837. When the time for submitting bids expires, the agency then eliminates all bids from contractors that do not qualify due to a material variation from the given specifications. Foley Bros., Inc., 266 Minn. at 263, 123 N.W.2d at 390; Coller, 223 Minn. at 385, 26 N.W.2d at 840. Of the remaining bids, the agency awards the contract to the qualified contractor with the lowest bid. Coller, 223 Minn. at 385, 26 N.W.2d at 840.
The Legislature has been cautious of giving agencies substantial discretion in contracting for public works to avoid “such abuses as fraud, favoritism, extravagance, and improvidence in connection with the letting of contracts.” Coller, 223 Minn. at 387, 26 N.W.2d at 841. Requiring officials to reject nonresponsive proposals eliminates opportunities for committing such abuses and promotes honesty, economy, and above-board dealing in the letting of public contracts. Id. at 387, 26 N.W.2d at 841. After receiving bids, the only function of the contracting agency, under traditional contracting principles, is “to determine who is the lowest responsible bidder.” Coller, 223 Minn. at 385, 26 N.W.2d at 840. A traditional approach bid is a definite offer to contract that can be accepted without further negotiations, but it must conform substantially to the advertised plan and specifications. Id. at 385, 26 N.W.2d at 840. A variance between the bid and the advertised plan and specifications is material if “it gives a bidder a substantial advantage or benefit not enjoyed by other bidders.” Id. at 385, 26 N.W.2d at 840. Responsiveness is determined at the time of the opening of the bid....
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