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Schultes v. Township of Haddon

Decided: October 29, 1951.

A. C. SCHULTES & SONS, A PARTNERSHIP CONSISTING OF A. C. SCHULTES, SR., A. C. SCHULTES, JR., JAMES F. SCHULTES AND MARY E. SCHULTES, PLAINTIFFS-RESPONDENTS,
v.
TOWNSHIP OF HADDON, A MUNICIPAL CORPORATION OF THE STATE OF NEW JERSEY, DEFENDANT, LAYNE-NEW YORK COMPANY, INC., A CORPORATION OF THE STATE OF NEW YORK, DEFENDANT-APPELLANT



On appeal from the Superior Court, Chancery Division.

For affirmance -- Chief Justice Vanderbilt and Justices Case, Wachenfeld, Burling and Ackerson. For reversal -- None. The opinion of the court was delivered by Wachenfeld, J.

Wachenfeld

[8 NJ Page 105] The query here is whether or not a contract with a municipality for the construction and drilling of deep wells for increased water supply, at a cost exceeding demand such highly specialized skill, knowledge, training

$1,000, comes within the statutory requirements providing for advertisement and the awarding of the contract to the lowest bidder.

The Township of Haddon needed an additional water supply and accordingly advertised for bids which called for the construction of one test well and two completely finished wells at either the 200-foot level or the 400-foot level, depending upon the information derived from drilling the test well. Bids were received from the plaintiff-respondent, A. C. Schultes & Sons, and from the defendant-appellant, Layne-New York Company, Inc., but were rejected by the township.

In asking for new bids, the township separated the drilling of the test wells from the construction of the permanent wells which would become part of its water system. The new request also provided for the building of two test wells instead of the one originally called for. Two separate advertisements were made and two separate sets of plans and specifications were prepared for use of the bidders, who were not obliged to bid on both contracts or on all alternative plans set out in the specifications for the deep wells.

The defendant was the low bidder for the drilling of the two test wells and was awarded a contract which is not under attack. It was also awarded a contract for the deep wells on which its bid was higher than the plaintiff's. The award was challenged by the institution of a proceeding in the Chancery Division by way of complaint in lieu of prerogative writ seeking to set aside the contract so made upon the ground that it was not given to the lowest bidder and so was in violation of the statute.

An ad interim restraint against the doing of any work on the contract was imposed and the parties have consented to its continuance pending the outcome of this litigation. Cross-motions for summary judgment were made by both parties and depositions taken. It was stipulated that the cause should be determined on the basis of the pleadings, the affidavits and the depositions as though the facts therein contained were adduced at final hearing.

The court below entered judgment setting aside the award of the contract to the Layne-New York Company, Inc. Because of the doubtful availability, as time progressed, of the equipment required for the performance of the contract and the likelihood of increased costs to the municipality for the completion of the project undertaken, all parties asked for, and this court granted, certification.

R.S. 40:50-1 provides, amongst other things:

"No municipality shall enter into any contract for the doing of any work, or for the furnishing of any materials, supplies or labor, or the hiring of teams or vehicles, where the sum to be expended exceeds the sum of one thousand dollars, unless the governing body shall first publicly advertise for bids therefor, and shall award the contract to the lowest responsible bidder."

R.S. 40:62-47 gives the governing body the right to pass ordinances and resolutions and to make agreements and contracts and to do all other acts necessary to provide water for public and private uses of the municipality and its inhabitants in accordance with the provisions of ...


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