Ellis Construction, Inc. v. Town of Farmingdale

STATE OF MAINE SUPERIOR COURT

KENNEBEC, SS. CIVIL ACTION

DOCKET NO. AP -2016-61

ELLIS CONSTRUCTION, INC, DECISION AND ORDER

Petitioner, AFTER REMAND

V.

TOWN OF FARMINGDALE,

Respondent

This matter is before the court following remand to the Town of

Farmingdale Select Board. This matter is an appeal, pursuant to M.R.Civ.P.

80B, of the decisions of the Farmingdale Select Board to reject the

Petitioner's bids for the Town's "Roadside Mowing" and "Sewer

Maintenance" contracts. In an Order dated April 18, 2017, the court

remanded this matter to the Select Board "to state the factual reasons for its

decision of September 7, 2016 to reject the Petitioner's bids for the Roadside

Mowing and Sewer Maintenance contracts and supplement the record with

those factual findings."

On April 27, 2017, the Petitioner filed a Motion to Reconsider, which

was denied on May 30, 2017.

SUPPLEMENTAL FACTUAL BACKGROUND

Following the remand in this case, the Farmingdale Select Board met

in a public meeting on May 3, 2017. Counsel for the Petitioner attended the

meeting, as did counsel for the town. Counsel for the town explained to the

members of the Select Board the court's remand order of April 18, 2017.

Counsel for the Petitioner, Ellis Construction, Inc., briefly addressed the

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Select Board and asked that it take into consideration "letters that are

submitted by citizens of your town." (Supplemental Record, S. R. at 28).

Alternatively, "[i]f the Board decides to not consider those letters, then I

would just urge you to not consider any new facts if the idea is that we're

not going to be adding new facts to the record." (Id.) The transcript of the

May 3, 2017 Select Board meeting indicates that the Board did not accept

the letters for consideration.

The town's attorney then reminded the members of the Select Board

that two RFP's had been issued in the summer of 2016 - one for roadside

mowing and the other for sewer maintenance. At the Select Board's meeting

of September 7, 2016 the Board voted to reject the bids submitted by the

Petitioner on the Roadside Mowing and the Sewer Maintenance RFP' s,

notwithstanding the fact that those were the lowest bids. (S.R. at 29). See

Order of April 18, 2017. The town's attorney then asked the members of the

Select Board to "voice" for the record the reason(s) for the earlier rejection

of the Petitioner's bids.

With respect to the rejection of the Petitioner's bid on the Sewer

Maintenance RFP, the Select Board explained that the town was "in

litigation concerning the sewer contract with Ellis Construction ..." and it

would be "very difficult" to have an on-going contractual relationship with

an adverse party. (S .R. at 29-31 ). The same reason was expressed by the

Select Board for its rejection of the Petitioner's bid on the Roadside Mowing

RFP, namely, that the working environment with a party who was in active

litigation with the town "would be ... very hostile," not "productive," and

"[e]xtremely uncomfortable." (S.R. at 31-32).

Following the May 3, 2017 meeting, the town's attorney drafted

proposed findings for the Select Board to review and approve, which it did

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on May 17, 2017. (S.R. at 42-43). Specifically, the Select Board found,

with respect to both the Sewer Maintenance and Roadside Mowing bids

submitted by the Petitioner, that "Ellis Construction served a civil complaint

on the Town of Farmingdale on January 7, 2016 alleging breach of contract

for allegations pertaining to the 2013 Sewer Inspection, Repair and

Maintenance contract." As to the rejection of both bids, "[t]he Board finds

that entering into a new contract with an existing adverse party would not be

in the best interest of the Town and therefore finds that Ellis Construction is

currently not a Qualified Bidder for the Sewer Maintenance [and] Road Side

Mowing contract[ s]." (Id.)

The parties submitted the Supplemental Administrative Record on

September 13, 2017. The Petitioner's Supplemental Brief was filed on the

same day. The Town's Supplemental Brief was filed on October 12, 2017.

STANDARD OF REVIEW

Generally speaking, in an appeal pursuant to M.R.Civ.P. 80B

the court reviews the decision of the local administrative agency to

determine if the agency "exceeded the bounds of discretion,

committed errors of law, or made findings of fact that are not

supported by substantial evidence contained in the record before

the administrative agency." Quiland, Inc. v. Wells Sanitary Dist.,

2006 ME 113, ,r 15, 905 A. 2d 806. The court's review is limited

to the "record of the proceedings before the governmental agency."

M.R.Civ.P. 80B(f). The burden of persuasion rests with the party

seeking to vacate the agency's decision. Bizier v. Town of Turner,

2011 ME 116, 8, 32 A. 3d 1048.

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Moreover, in the context of a municipality's decision to

award a contract for goods or services, the Law Court has held that

"[a]s a general rule, courts will interfere with a municipal body's

award of a contract only if there is fraud, favoritism, or

corruption." Dineen v. Town of Kittery, 639 A.2d 101, 102 (Me.

1994). The high level of deference to a municipality's purchasing

decisions appears to be well-established. See, e.g., Gerald Seigars

Trucking, Inc. v. Dresden, 531 A.2d 1023, 1024, n. 2 (Me. 1987);

Butler v. Tremont, 412 A.2d 385, 387 (Me. 1980)(absent a statute

or ordinance providing otherwise, "the awarding of public

contracts is left to the reasonable judgment of proper municipal

authorities"). A number of Superior Court decisions recognize the

"considerable discretion" a municipality (or other public agency)

has "when it comes to deciding what constitutes [its] 'best interest'

in awarding a contract." Maietta Construction, Inc. v. City of

Portland, 2005 Me. Super. LEXIS 48, *5 (2/2/2005) (Cole, J.).

See also Hardypond Construction v. University of Maine System,

2013 Me. Super. LEXIS 48, *6 (5/6/2013) (Warren, J.); Warren

Mechanical, Inc. v. Carvel Co., 1997 Me. Super. LEXIS 94, *20

(3/18/1997) (Saufley, J.) ("courts will not interfere lightly in the

actions of a public body engaged in a bidding procedure").

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DISCUSSION

The Petitioner argues that the Select Board's action on

remand was an abuse of discretion because its ultimate finding that

Ellis Construction was not a qualified bidder "is an after-the-fact

fix based on the advice and lead of counsel." Petitioner 's

Supplemental Brief at 3. The Petitioner insists that "the Town is

obligated to follow a competitive bidding process whereby the

lowest qualified bidder wins." Id. at 3-4. Closely related to this

argument is the Petitioner's assertion that the Town of

Farmingdale had no discretion to reject its bids and that it was

deprived of procedural due process by the Select Board's refusal to

accept additional evidence or to allow counsel for the Petitioner to

be heard at the May 3, 2017 meeting.

The court disagrees. Farmingdale's code of ordinances

makes it unmistakably clear that "[b ]ids are offers made to the

Town to do the work described in the invitation to bid," and "[t]he

Board of Selectmen is not obligated to accept any bid, and may

reject all bids." Article 2, §2-201(2)(A). The Select Board is

granted substantial discretion in accepting and/or rejecting a bid to

provide services to the town. The Select Board was not obligated

to award the contracts to the Petitioner under circumstances where

it knew that the town had already been sued by the Petitioner for

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breach of contract in relation to its previous award of the Sewer

Maintenance contract.

The Select Board was not required to turn a blind eye to the

reality that it was in active litigation with the Petitioner, nor was it

mandated to do more business with such an adverse party. It was

obvious to the court from its reading of the original administrative

record that the Select Board was seriously considering the rejection

of the Petitioner's bid proposals, but wanted to consult with

counsel on the issue. See Order of April 18, 2017 at 5. It is

reasonable to conclude from the record that the Select Board did

not want to make public statements about a bidder (the Petitioner)

who had already sued the town and was litigating with it about a

previous contract. As a result, it construed its ordinances to allow

it to reject the Petitioner's bids without articulating a reason on the

public record.

This court's remand order did not in any way suggest that the

Select Board lacked the discretion to reject the Petitioner's bids.

Rather, the court could not conduct meaningful judicial review of

the record without an explanation of the reason for the Select

Board's action. The Select Board has complied with the court's

remand order, and the court is satisfied that the Select Board's

decision to reject the Petitioner's bids because of the on-going

litigation with the town, was not an abuse of discretion.

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Finally, the court rejects the Petitioner's argument that its due

process rights were violated by the Select Board. See Carroll F.

Look Constr. Co v. Town of Beals, 2002 ME 128, 116, 802 A.2d

994. See also Budget Business Machines v. Wells/Ogunquit School

District, 2017 Me. Super. LEXIS 65, *10, n. 5 (5/15/2017)

(O'Neil, J.).

CONCLUSION

The entry is:

Petitioner's Appeal pursuant to M.R.Civ.P. 80B 1s

DENIED.

The Clerk is directed to incorporate this Order by reference in the

docket in accordance with M.R.Civ.P. 79(a).

DATE: November 3, 2017.

William Stokes

Justice, Superior Court

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