State ex rel. Sletten Const. Co. v. City of Great Falls

• Court: Montana Supreme Court
• Writing for the Court: PER CURIAM; CASTLES
• Citation: State ex rel. Sletten Const. Co. v. City of Great Falls, 163 Mont. 307, 516 P.2d 1149 (Mont. 1973)
• Decision Date: 13 December 1973
• Docket Number: No. 12635,12635
• Parties: STATE of Montana ex rel. SLETTEN CONSTRUCTION COMPANY, a Montana Corporation, Petitioner, v. CITY OF GREAT FALLS et al., Defendants.

Page 1149

516 P.2d 1149

163 Mont. 307

STATE of Montana ex rel. SLETTEN CONSTRUCTION COMPANY, a Montana Corporation, Petitioner, v. CITY OF GREAT FALLS et al., Defendants.

No. 12635.

Supreme Court of Montana.

Submitted Nov. 16, 1973.

Decided Dec. 13, 1973.

Jardine, Stephenson, Blewett & Weaver, Alex Blewett, Jr., argued, Great Falls, for petitioner.

John H. Kuenning and Paul D. Miller, John H. Kuenning argued, Smith, Emmons & Baillie, James R. Walsh, argued, Great Falls, Terence B. Cosgrove argued, Robert W. Corcoran appeared, R. Bruce McGinnis appeared, Helena, for defendants.

PER CURIAM:

This is an original application for a writ of mandate or other appropriate writ to compel the City of Great Falls, Montana to award a public works construction contract to petitioner Sletten Construction Company, a Montana corporation. The essence of petitioner's contention is that it is entitled to the contract award under the provisions of Montana's resident contractor preference law.

An order to show cause was issued setting the matter for hearing on November 16, 1973; service was accomplished on defendants: the City of Great Falls and its Commissioners; the Department of Revenue, State of Montana, and its Director; and upon the successful bidder, Action Construction Company, Inc. of Hugo Minnesota. Leave to intervene was granted to Acton; a motion to quash was filed by the Department of Revenue; answers were filed by all defendants and intervenor; briefs were filed by all parties; and oral argument was heard at the hearing.

Thereafter this Court by judgment dated November 21, 1973, accepted jurisdiction; held Acton's affidavit of residency insufficient to support the certificate of residency issued by the Department of Revenue and annulled the same; ruled that the parties were free to proceed thereafter in accordance with law; and indicated a written opinion would follow. Subsequently, the City of Great Falls revoked its original award and awarded the contract to petitioner Sletten Construction Company.

The relevant facts indicate the City of Great Falls invited bids on a public works construction contract on improvements to its water treatment plant which was denominated 'Contract 2, Water Works Improvements'. It received several bids, the two lowest being that of Acton Construction Company, Inc., a foreign corporation of Hugo, Minnesota, in the amount of $1,752,240, and the Sletten Construction Company, a Montana corporation, of Great Falls in the amount of $1,775,000. It is to be noted that Sletten's bid is less than 3% higher than Acton's.

At all material times in 1973 Acton had a Montana contractor's license, but had not initially qualified as a resident contractor under Montana's resident contractor preference law. However in October 1973, Acton filed with the Department of Revenue, State of Montana, and affidavit seeking resident contractor status stating in pertinent part:

'Affiant states that at all times during 1973 all materials, supplies and equipment offered by Acton Construction Co., Inc. on any Public Works Contracts are produced in Montana by industries located in Montana insofar as such materials, supplies and equipment are available.

'With the exception of selected supervisory personnel Montana labor is exclusively employed on all Public Works Contracts involving Acton Construction Co., Inc. in the State of Montana.'

On the basis of this affidavit Acton requested recognition as a resident bidder as of January 9, 1973. The Department of Revenue thereupon issued its certification of Acton as a resident contractor under section 82-1925, R.C.M.1947.

On November 6, 1973, the City Commission of Great Falls acting on the basis of this certification passed a resolution accepting the bid of Acton and authorized the City Manager to execute the necessary contracts.

Petitioner brought the instant original proceeding in this Court thereafter.

Defendants and intervenor raise the following issues which we will summarize:

(1) The standing of petitioner to maintain this action.

(2) The appropriateness of an original proceeding for writ of mandate as a remedy.

(3) The legality of the actions of the Department of Revenue and the City of Great Falls under Montana's resident contractor preference law.

The Department of Revenue and Acton take the position that Sletten has no standing to challenge the validity of the Department's action by a proceeding seeking judicial review. They cite in support: State ex rel. Stuewe v. Hindson, 44 Mont. 429, 120 P. 485; Koich v. Cvar, 111 Mont. 463, 110 P.2d 964; Ruidoso State Bank v. Brumlow, 81 N.M. 379, 467 P.2d 395; Baltimore Retail Liquor Package Stores Association v. Kerngood, 171 Md. 426, 189 A. 209, 109 A.L.R. 1253; State ex rel. Rouveyrol v. Donnelly, 365 Mo. 686, 285 S.W.2d 669. In our view all these cases are clearly distinguishable and do not support the proposition that Sletten has no standing in the instant proceeding.

We recognize the broad proposition that an unsuccessful bidder has no standing in mandamus or otherwise to control the discretion of the city council in awarding a contract to the lowest responsible bidder. The relief granted in the instant case does not do this. On the contrary, this Court's judgment of November 21 simply annulled the certificate of residency the Department of Revenue granted Acton, leaving the parties free to proceed in accordance with law. A resident contractor such as Sletten who, in effect, had been denied its statutory preference is an aggrieved party entitled to judicial review. For an example of cases involving judicial review under resident contract or preference statutes at the instance of unsuccessful bidders, see Stebbins & Roberts, Inc., v. Pulaski Glass & Mirror Co., 233 Ark. 449, 345 S.W.2d 912; Schrey v. Allison Steel Mfg. Co., 75 Ariz. 282, 255 P.2d 604.

The Department of Revenue and intervenor next contend that a writ of mandate is not proper in the instant case because it will not lie to control discretionary acts; and contract award has already been made; and administrative remedies within the Department of Revenue have not been exhausted.

In this case the judgment of November 21 did not attempt to control any discretionary acts of public agencies but simply cancelled and annulled a certificate of residency granted a Minnesota contractor by the Department of Revenue upon which the city relied in making the contract award. As this certificate of residency was invalid, we simply annulled it and left the parties in...