State Highway Commission v. Canion

• Decision Date: 02 July 1952
• Docket Number: No. 10063,10063
• Parties: STATE HIGHWAY COMMISSION et al. v. CANION.
• Court: Texas Court of Appeals

Page 439

250 S.W.2d 439

STATE HIGHWAY COMMISSION et al. v. CANION.

No. 10063.

Court of Civil Appeals of Texas, Austin.

July 2, 1952.

Rehearing Denied July 30, 1952.

Price Daniel, Atty. Gen., William S. Lott and V. F. Taylor, Asst. Attys. Gen., for appellant.

Jones, Herring & Jones, by Herman Jones, Austin, for appellee.

ARCHER, Chief Justice.

This is an appeal by the State Highway Commission and its officers from a judgment of the District Court, which allowed appellee to withdraw his bid on State Highway Road Construction Project No. S-1825(1), Trinity County, Texas, and which perpetually enjoined and restrained appellants from forfeiting appellee's bid guaranty deposit check in the sum of $4,000. Appellee applied for a temporary injunction to restrain appellants from cashing his proposal guaranty check. By agreement, the case was tried on its merits at the time set for a hearing on the temporary injunction.

The appellee filed his bid on November 14, 1951, on which day the bids were opened; later, the same day, appellee discovered that he had made a mistake and had omitted the one dollar before his bid upon 18,682 cubic yards of foundation course, which resulted in bids of 63cents and 40cents which were intended to be $1.63 and $1.40, respectively, which mistake reduced appellee's bid by $18,682. This mistake was called to the attention of the Highway Commission the following day and before the bids were accepted. The appellants on November 19 or 20 accepted the bid and mailed appellee a proposed contract.

The bid of appellee was accompanied by a cashier's check for $4,000 as a guaranty deposit, which under the rules of the appellants would have been forfeited unless appellee entered into the contract.

Appellants contend that the trial court was in error in holding that the attempted acceptance of the bid was null and void because of the mistake of appellee in performing it, and in enjoining appellants from forfeiting the guaranty deposit and in ordering the deposit check returned to appellee, and further in overruling appellants' Special Exception and finally in refusing to make additional findings of fact as requested by appellants.

The appellee's position is that he made an honest mistake, which occurred in spite of his exercise of reasonable care and which mistake was made known to appellants before they acted upon his bid.

The court made findings of fact and conclusions of law, which are not excepted to or objected to by appellants.

The fact findings are that the State Highway Department furnished bidders a form bid sheet upon which all were required to bid, and such sheet did not show the lump sum bid but a unit price upon each item. That plaintiff prepared his bid on November 13, 1951, and filed it on the following day prior to 10 a. m., the hour set for opening the bids. That in preparing his bid plaintiff had determined to make a bid of $1.63 per cubic yard on the 12th item and a bid of $1.40 per cubic yard on the 13th item, and that through an error in calling or copying the bid items designated 12th and 13th the price was $.63 and $.40 respectively, the one dollar being omitted in each instance, which produced a difference of $18,682.

The court further found that at the time plaintiff filed his bid he did not know of the error above set out; that plaintiff is an experienced contractor and has been engaged in the business of estimating, bidding and constructing jobs for the State Highway Department, and was familiar with the rules and regulations of said Department; that the error did not result from lack of care on the part of plaintiff or his assistants, but such error occurred notwithstanding the exercise of reasonable care and precaution and the bid was the result of an honest, good faith mistake, which occurred through inadvertence, and that the bid did not express the intentions of plaintiff and would not have been filed as it was but for such mistake.

Plaintiff was familiar with the instructions to bidders concerning the withdrawal of proposals which provide as follows:

'A bidder may withdraw his proposal provided his request in writing to do so is in the hands of the official indicated in the Notice to Contractors by the time set for opening of proposals.

'A bidder may change the unit prices in his proposal provided his request to do so is submitted in writing and is in the hands of the State Highway Engineer prior to the time set for opening of proposals. Requests by telephone or telegraph for changes in bid prices or for withdrawal of proposals will not be considered.'

The court found that plaintiff discovered his error on November 14, 1951, when the bids were opened, and wrote a letter to the defendants advising them of such error, which was received by defendants on November 16, 1951, and in such letter requested that his bid be not considered and that he have his check returned to him; that plaintiff was advised by an assistant to the Highway Engineer that the Commission would meet in Austin on the following November 19th and 20th, and bids would be considered and requested plaintiff to be available on those two days in the event the Commission desired to contact him with reference to his bid and his request that it not be considered. At the meeting of the Commission the plaintiff's verified letter was called to the attention of the Commission before the bids were acted on, and plaintiff was not requested to appear before the Commission and no investigation as to the accuracy of the representations in the request was made. That the Commission declined to permit plaintiff to withdraw his bid, but undertook to accept same and mailed a contract to plaintiff based on the mistaken bid. That plaintiff declined to execute the contract and the Commission would have forfeited the guaranty check but for the injunction, and such forfeiture would have resulted in substantial loss to plaintiff for which he would have no reasonable adequate remedy at law. The findings were that except for the two unit prices, which were bid by plaintiff through mistake, the bid was not unbalanced.

Prior to the defendant Commission's attempted acceptance of plaintiff's mistaken bid, plaintiff had not only advised the Commission of his mistake and sought to withdraw his bid, but also, plaintiff had advised the Commission that it would be impossible for him to perform the work under the mistaken bid both because he was not financially able to perform at the mistaken figure and because he could not make bond as required by Commission. Whether the defendant Commission undertook to accept the mistaken bid in the hope of getting the bargain resulting from the mistake or solely for the purpose of placing itself in a position to forfeit plaintiff's bid guaranty deposit, either result would have been in equitable and oppressive toward the plaintiff.

The court concluded as a matter of law that:

1. Plaintiff was entitled to withdraw his bid offer which was the result of an honest mistake, occurring in spite of the exercise of reasonable care, since, before the offer was acted upon by the defendant State Highway Commission, plaintiff sought to withdraw the offer and made the mistake known to the Commission.

2. The attempted acceptance of plaintiff's offer by the defendant Commission was ineffectual to create a contract between plaintiff and defendant Commission, because there was no meeting of the parties' minds since plaintiff's mistaken bid was not his true offer but was the result of a mistake which fact was known to the defendant Commission at the time of the attempted acceptance.

3. The defendants received nine bids, at least three of which could have been retained for acceptance by defendants for a period of thirty days from the bid opening under the regulations of the Commission.

4. Since the attempted acceptance by the defendant Commission fo plaintiff's mistaken offer was ineffectual to create a contract with plaintiff, the Commission had and has no legal right to forfeit or withhold plaintiff's bid guaranty deposit because of his failure to execute the tendered contract, but plaintiff was and is entitled to have the deposit returned to him.

5. If the plaintiff's bid guaranty deposit is forfeited by defendants and placed beyond their control, plaintiff will suffer real and substantial loss which will be irreparable and for which plaintiff has no adequate remedy at law.

We believe that evidence reasonably supports the findings of the court and that the judgment is a proper one.

We will set out in some detail from the record the evidence as adduced by both the plaintiff and defendants in the trial of the case.

The appellants contend that the State Highway Commission, by accepting appellee's low bid, had the legal right to forfeit and cash the guaranty check if Canion refused to enter into a contract to construct the road, and that it was error for the court to restrain the Commission from forfeiting the said deposit.

Further the appellants say that the case will turn on whether a bidder on a Texas Highway project is bound by the provisions...