Yellow Cab of Cleveland, Inc. v. Greater Cleveland Reg. Transit Auth.

• Decision Date: 19 February 1991
• Docket Number: No. 57884,57884
• Parties: YELLOW CAB OF CLEVELAND, INC., Appellee, v. GREATER CLEVELAND REGIONAL TRANSIT AUTHORITY, Appellant.
• Court: Ohio Court of Appeals

Page 558

72 Ohio App.3d 558

595 N.E.2d 508

YELLOW CAB OF CLEVELAND, INC., Appellee, v. GREATER CLEVELAND REGIONAL TRANSIT AUTHORITY, Appellant.

No. 57884.

Court of Appeals of Ohio, Eighth District, Cuyahoga County.

Decided Feb. 19, 1991.

Syllabus by the Court

A contract to provide special transportation services for the handicapped and elderly is not a personal services contract exempted from competitive bidding under R.C. 306.43 as it is not a contract in which the offeree is vested with discretion in accomplishing the assigned tasks.

Goldfarb & Reznick, Bernard S. Goldfarb, Mark V. Webber and Carl E. Cormany, Cleveland, for appellee. Russell T. Adrine, Oscar Trivers, Douglas H. Kohout and Robert C. Brooks, Cleveland, for appellant.

Porter, Wright, Morris & Arthur and Richard M. Markus, Cleveland, for amicus curiae, Ohio Public Transit Ass'n.

DYKE, Judge.

Plaintiff-appellee, Yellow Cab Company of Cleveland, Inc. ("Yellow Cab"), filed an action in which it sought preliminary and permanent injunctive relief and a declaratory judgment restraining defendant-appellant, Greater Cleveland Regional Transit Authority ("GCRTA"), from conducting any activities in furtherance of the negotiated contracts procedure which was initiated by the issuance of a Request for Proposal for the procurement of special transportation service for the elderly and handicapped.

After an evidentiary hearing, the trial court granted a preliminary injunction. The case proceeded to trial and at its conclusion the court ruled that the contract which appellant sought to enter was not a personal services contract and that appellant was mandated to award the contract in accordance with the competitive bidding requirements of R.C. 306.43. The court stated that appellant was not authorized to enter into a contract after receipt of responses to its Requests for Proposals.

Appellant filed a request for separate findings of fact and conclusions of law on or about May 24, 1989. However, before the court made any findings or conclusions, appellant filed its notice of appeal.

GCRTA, as a supplement to its regular scheduled mass transportation service to the Greater Cleveland area, provides special transportation services to the elderly and handicapped. The title of this service is Community Response Transit ("CRT"). GCRTA provides the majority of the service with its own vehicles and employees, but supplements that service by engaging a private carrier to provide regular trips service and special medical transportation service to the suburbs of Cuyahoga County. Yellow Cab had provided that service to GCRTA for thirteen years, pursuant to a competitively bid contract.

In 1989 the contract between GCRTA and Yellow Cab was due to expire. GCRTA management suggested to its board of trustees that instead of procuring a new contract by competitive bid, an alternate method of procurement should be used. GCRTA management advised that the new contract be entered into using the Request for Proposals ("RFP") pursuant to GCRTA's negotiated contract procedure. The RFP method is not competitive bidding.

In recommending this alternative method to the trustees, Ronald J. Tober, GCRTA's Manager/Secretary Treasurer, stated:

"What we are essentially seeking in this procurement is a professional service to manage and operate CRT services on the authority's behalf. We are looking for the best approach to ensure the delivery of high quality service at the best price possible. This is decidedly different than trying to get the lowest price for something that meets a well-defined set of minimum specifications."

GCRTA's Board of Trustees approved the suggestion that the procurement of this service be obtained by negotiated contracts, i.e., RFPs. That resolicitation of proposals for this procurement is the subject of the present controversy.

The parties stipulated the issue at trial to be as follows:

"Is GCRTA bound under State law to obtain the supplemental special transportation services for the elderly and handicapped by competitive bidding? The parties agree that the RFP method of procurement is not competitive bidding."

The case was tried to the bench. Yellow Cab's complaint was that the special transportation service sought to be procured by GCRTA was not a "personal service" exempt from competitive bidding under R.C. 306.43.

In its decision, the trial court recognized that GCRTA need not seek competitive bids for "personal services" contract under R.C. 306.43. However, the trial court found that the proposed contract was "not one for personal services" and thus enjoined GCRTA from pursuing the RFP procedure in conjunction with issuing a contract for suburban and handicapped and elderly transportation services. The court ordered GCRTA to comply with the provisions of R.C. 306.43 requiring defendant to solicit sealed bids for the procurement of those services.

Appellant GCRTA assigns four errors for our review. ¹

I & II

"The trial court's finding that the providing of special transportation service for the handicapped and elderly is not a personal service contract exempted from competitive bids under 306.43 O.R.C. was against the manifest weight of the evidence.

"The trial court's finding that the providing of special transportation service is not a personal service contract exempted from competitive bids under [R.C.] 306.43 was erroneous as a matter of law."

GCRTA argues in its first and second assignments of error that Special Transportation Service is a "personal service" within the meaning of this section and that it is therefore exempted from the general requirement for competitive bidding. ² GCRTA states that the judgment of the trial court finding to the contrary was unsupported by the evidence.

R.C. 306.43 states the law governing GCRTA's procurement of special transportation service and provides in pertinent part:

"The board of trustees of a regional transit authority or any officer or employee designated by such board may make any contract for the purchase of supplies or material or for labor for any work, under the supervision of the board, the cost of which shall not exceed fifteen thousand dollars. When an expenditure, other than for * * * personal services * * * exceeds fifteen thousand dollars, such expenditure shall be made only after a notice calling for bids has been published * * *. The board may let the contract to the lowest and best bidder. * * *" ³ (Emphasis added.)

The standard of review under manifest weight was set forth in C.E. Morris Co. v. Foley Constr. Co. (1978), 54 Ohio St.2d 279, 8 O.O.3d 261, 376 N.E.2d 578, syllabus, as follows:

"Judgments supported by some competent, credible evidence going to all the essential elements of the case will not be reversed by a reviewing court as being against the manifest weight of the evidence." (Emphasis added.)

Thus, the issue before this court is whether there exists some competent, credible evidence from which the trial court could have concluded that the special transportation service was not, as defined in GCRTA's RFP, a "personal service" within the meaning of R.C. 306.43 and thus could not be exempted from competitive bidding.

There is no case law which specifically discusses the meaning of "personal services." We turn to R.C. 307.86, a parallel provision which requires competitive bidding on county purchases for direction in determining when a contract is defined as one for "personal service." ⁴ Services excepted from competitive bidding are those which vest significant discretion in the contractor. Services which have been excepted from competitive bidding under R.C. 307.86 are those of an accountant, architect, attorney at law, physician, professional engineer, construction project manager, consultant, surveyor, or appraiser. State, ex rel., Doria, v. Ferguson (1945), 145 Ohio St. 12, 30 O.O. 241, 60 N.E.2d 476 (services of an attorney in a contract for title services); Attlin Constr., Inc. v. Muncie Community Schools (Ind.App.1980), 413 N.E.2d 281 (contract with construction manager who had to use professional engineering skills and experience); Hordin v. Cleveland (1945), 77 Ohio App. 491, 33 O.O. 336, 62 N.E.2d 889 (services of advertising specialists); Cleveland v. Lausche (1943), 71 Ohio App. 273, 26 O.O. 123, 49 N.E.2d 207 (Cleveland Museum of History hired to manage, operate and develop Cleveland zoological gardens). These cases, as well as the listed exceptions in R.C. 307.86, appear to define a "personal services" contract as one in which the offeree is vested with discretion in accomplishing the assigned tasks because his skills, knowledge, experience and expertise are unique to the area and could not be duplicated by others not similarly qualified. As the ability to define the task and requests for specific conclusions expand, discretion to add input and knowledge to the outcome lessens. Thus, where specific guidelines exist, the need for a personal service diminishes.

The record in this case contains competent, credible evidence that GCRTA, in its RFP, diminished the contractor's ability to exercise significant discretion. GCRTA's claim that a contractor providing special transportation service would exercise a substantial degree of discretion is not supported.

Wayne Simmons, GCRTA's Supervisor of Community Responsive Transit, including special transportation service, stated that the work assignment for the special transportation service contractor would be made by GCRTA for its daily tours for each vehicle needed. He stated all scheduling would be done by GCRTA. Simmons stated that what would be left for the subcontractor would be the assigning of vehicles to the runs, the maintenance of those vehicles, and the training of the drivers to be aware of the routes and the special needs of the passengers.

Ronald Tober, GCRTA General Manager, testified that in the...