White v. McDonald Ford Tractor Co., 3 Div. 478

• Decision Date: 06 May 1971
• Docket Number: 3 Div. 478
• Citation: 287 Ala. 77,248 So.2d 121
• Parties: Howard L. WHITE, Jr. v. McDONALD FORD TRACTOR COMPANY, Inc.
• Court: Alabama Supreme Court

Page 121

248 So.2d 121

287 Ala. 77

Howard L. WHITE, Jr. v. McDONALD FORD TRACTOR COMPANY, Inc.

3 Div. 478.

Supreme Court of Alabama.

May 6, 1971.

Hill, Hill, Stovall, Carter & Franco and Robert C. Black, Montgomery, for appellant.

J. Paul Lowery and James D. Straiton, Montgomery, for appellee.

Herman H. Hamilton, Jr., Champ Lyons, Jr., Montgomery, James R. Solomon, Jr., amici curiae.

MADDOX, Justice.

The question presented by this appeal requires an interpretation of Alabama's Competitive Bid Law.

On October 19, 1970, the Division of Purchases and Stores of the Department of Finance issued an invitation to bid for sixty-five low center of gravity turf tractors with sleeve-type engines to be used by the Alabama Highway Department for mowing grass and brush from highway right-of-ways. The invitations, with specifications, were sent to 278 prospective bidders. Ten responses were received, including the bid by McDonald Ford Tractor Company, Inc., the appellee here. The bids were opened on October 29, 1970 and all parties admit that McDonald submitted the lowest bid of those responding. Five of the bidders, including McDonald, submitted bids on tractors which did not have sleeve-type engines and did not meet other specifications and were determined by State officials not to be suitable for the needs and purposes for which the tractors were required. Five bidders were determined to meet specifications, needs and purposes and upon recommendation of Highway Department personnel, concurred in by the State Purchasing Agent, Howard L. White, Jr., (Appellant) and Finance Director, Robert B. Ingram, the award of the contract was made to Booker Tractor Company, which had submitted the lowest bid of the five qualifying and conforming bids. McDonald had submitted the lowest bid of what state officials determined to be non-qualifying and non-conforming bids. Since the award was not made to the lowest bidder, reasons for the award were entered in the bid record. ¹ Booker ordered the tractors, delivered them to the State, but has not been paid therefor.

On December 23, 1970, McDonald filed its petition for injunctive relief in the Circuit Court of Montgomery County against Albert P. Brewer, Robert B. Ingram, Marion H. Wilkins, and Howard L. White, Jr. ²

Booker Tractor Company, to whom the award was made, was not made a party.

A motion for a temporary restraining order was presented to Circuit Judge Richard P. Emmet on December 28, 1970, and on December 28, 1970, Judge Emmet ordered a hearing on the matter for December 31, 1970.

The cause was heard orally by the court and on January 8, 1971, Judge Emmet entered a decree in which he found that there was 'no evidence of any impropriety whatsoever on the part of any state officials; elected, appointed or merit.' He also found 'no evidence of untruthfulness upon the part of any official's testimony.'

Much of the testimony centered around the relative merits of the Massey-Ferguson tractor bid by Booker and a Ford tractor bid by McDonald. Unquestionably, the record shows that State Highway Department employees who initiated the requests for the sixty-five tractors preferred the Massey-Ferguson tractor. In fact, it is admitted that the specifications sent with the invitations to bid were drawn around the Massey-Ferguson turf tractor, but only after the division engineers of the Highway Department agreed that this type tractor was best suited for the purposes for which the tractors were required. The trial court, although finding 'no evidence of any impropriety on the part of any state official; elected, appointed or merit', nevertheless restrained purchasing agent White from proceeding further with the bid. The justification for such relief, if appropriate, must come from the trial court's finding and conclusion as follows:

'The intent, spirit and language of the Competitive Bid Law certainly discourages these admitted specially drawn specifications. This is, to this Court, self-evident. A competitive bid to be 'competitive' must be an open bid. If the specifications are so drawn as to allow only one item to meet the specifications, then a mockery is made of the law. Practically all products have competitors. If the specifications are so drawn as to eliminate most of the competitors and to leave in only a select few, the competitive aspect is also eliminated.

'The Court finds that the item offered by the Petitioner here substantially meets or exceeds the relevant specifications and therefore is a qualified bid.

'The Court observes the fact that these practices might well have existed before. It might even be that in previous instances the petitioner benefited. These facts, however, do not justify the continuance of such a system. Indeed, such prior existence is all the more reason to bring about a discontinuance.'

Therefore, as we view this appeal, there is one question involved:

'Under Albama's Competitive Bid Law, can specifications be drawn to fit a particular article or piece of equipment which has been determined to be suitable for the needs and purposes required prior to the time the equipment is requisitioned?'

The question presented is not a simple one. The appellant says that our Competitive Bid Law authorizes the drawing of specifications around a piece of equipment such as the Massey-Ferguson tractor in this case, especially since it was shown that the other bids were considered and that the bid accepted was the 'lowest responsible bid.' McDonald (Appellee) stoutly denies that our law so provides and contends that when specifications are so framed, free and full competition is precluded and the award made to Booker is void even though the state officials were found not to be guilty of any impropriety.

To answer the question, we must look at our Competitive Bid Law, especially Section 1 of Act No. 870, Acts of Alabama, 1961, p. 1365, which amends Section 9 of Act No. 343, approved August 20, 1957, (Title 55, § 502, Code of Alabama 1940, Recompiled 1958), and provides as follows:

'Section 9. When purchases are required to be made through competitive bidding, award shall be made to the lowest responsible bidder taking into consideration the qualities of the commodities proposed to be supplied, their conformity with specifications, the purposes for which required, the terms of delivery, transportation charges, and the dates of delivery. The purchasing agent in the purchase of or contract for personal property or contractual services shall give preference, provided there is no sacrifice or loss in price or quality, to commodities produced in Alabama or sold by Alabama persons, firms, or corporations. It is provided, however, that the awarding authority may at any time within five days after the bids are opened, negotiate and award the contract to any one provided he secures a price at least five per cent (5%) under the low acceptable bid. The award of such a negotiated contract shall be subject to approval by the Director of Finance and the Governor. The awarding authority or requisitioning agency shall have the right to reject any bid if the price is deemed excessive or quality of product inferior. Each bid, with the name of the bidder, shall be entered on a record. Each record, with the successful bid indicated thereon, and with the reasons for the award if not awarded to the lowest bidder, shall, after award of the order or contract, be open to public inspection. Contracts for the purchase of personal property or contractual services shall be let for periods not greater than one year.'

All parties seem to agree that being the Lowest bidder does not automatically entitle the bidder to the award in every instance. As a matter of fact, counsel for McDonald stated at oral argument in answer to a question from a member of the Court that if the specifications in this case had been written in More general terms, and had the identical bidders responded, as did respond here, then the Highway Department officials could have determined Booker to be the 'lowest responsible bidder' on the ground that the Massey-Ferguson tractor would better meet their needs and no violation of the statute would have occurred. The position of McDonald on this point is not completely without merit. For instance, in this case, McDonald's bid was classified as non-qualifying and non-conforming, as were the other three Ford dealers' bids and the John Deere dealer's bid. Failure to meet Specifications was always given as one of the reasons why the bid failed to conform. Also, Purchasing Agent White testified that specifications could be written so precise as to exclude other items, but denied that the specifications were so drawn in this instance or that the policy of the agents for the State was to draw specifications which would have this affect. In testimony:

'Q Now, you seem to be very familiar with the Competitive Bid Law, Mr. White.

'A I hope I am.

'Q Do you feel that it is a good practice to write specifications around a particular product so as to allow the State to purchase a particular product or do you feel the intent of that law is to write a general specification so as to get the best responsible product at the lowest possible price?

'A Do you want me to answer yes or no or elaborate?

'Q I would like for you to elaborate, please.

'A In all specifications you have to start with some item. In our department, in our experience, we always start with something that they know will do the job, and they know a piece of equipment whatever it might be. To begin, we state that we are using these specifications on the level of quality. It is not our intention to exclude anybody. If we were wanting to exclude people we would put turn radius, such items as center of gravity, things that nobody could actually meet, but we do have to start somewhere. Five years ago we tried to use Federal specifications exclusively or as much as we could. The Federal specifications were so outdated that...