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Gannett Outdoor Co. v. City of Atlantic City

Decided: June 17, 1991.

GANNETT OUTDOOR CO., INC. OF NEW JERSEY, PLAINTIFF-APPELLANT,
v.
CITY OF ATLANTIC CITY, A MUNICIPAL CORPORATION OF THE STATE OF NEW JERSEY, DEFENDANT-RESPONDENT, AND SIDEWALK SHELTERS, INC., DEFENDANT



On appeal from Superior Court, Law Division, Atlantic County.

Judges Petrella and Muir, Jr. The opinion of the court was delivered by Petrella, P.J.A.D.

Petrella

This appeal by Gannett Outdoor Co., Inc. of New Jersey (Gannett) concerns the failure of the Atlantic City governing body to award or reject bids within 60 days as required by

N.J.S.A. 40A:11-24, and the right of the city to reject all bids thereafter. Gannett claims on this appeal that it is entitled to a hearing on the rejection of its bid as a result of the lapse of 60 days from the submission of the bids. It also challenges the right of Atlantic City to reject any and all bids.*fn1

Atlantic City publicly advertised for bids for the placement of shelters at jitney stops in the city, reserving the right to reject all bids. The city had apparently attempted this procedure on two earlier occasions. Only two bids were received on February 13, 1990: one from Gannett and one from Sidewalk Shelters. Since the city failed to take action within the 60 day time period contained in N.J.S.A. 40A:11-24, the bids were considered rejected. See Casey Auto Parts v. City of Camden, 218 N.J. Super. 255 (Law Div. 1987).

Gannett filed a complaint in lieu of prerogative writs and thereafter unsuccessfully moved for summary judgment. The judge sustained Atlantic City's rejection of Sidewalk Shelters' bid for failure to provide the required bid security. He also upheld the rejection of Gannett's bid by the governing body's adoption of a resolution on June 6, 1990 to that effect, although this was beyond the 60-day provision for the award of a contract as specified in N.J.S.A. 40A:11-24.

Gannett argues that at a minimum it is entitled to reasons why its bid was not awarded and a hearing before the city council with respect to those reasons. It additionally argues that based upon the record before the court, the trial court should have granted its summary judgment motion and awarded the contract to it.

Atlantic City had reserved the right in its bid specifications to reject all bidders. In addition, N.J.S.A. 40A:11-6.1 provides, regarding purchases or contracts, that if the governmental

entity determines that extraordinary, unspecifiable service makes it impractical to solicit competitive bids, or circumstances exist such that the award of the bid is not made on the basis of the lowest quotation received,*fn2 a statement or explanation of reasons should be filed. This statute does not by its terms require the filing of a statement of reasons if all bids are rejected. It provides:

All purchases, contracts or agreements which require public advertisement for bids shall be awarded to the lowest responsible bidder.

Prior to the award of any other purchase, contract or agreement, the contracting agent shall, except in the case of the performance of professional services, solicit quotations, whenever practicable, on any such purchase, contract or agreement the estimated cost or price of which is $1,000.00 or more, and the award thereof shall be made, in accordance with sections 3 (C. 40A:11-3) or 4 (C. 40A:11-4), as the case may be, of the Local Public Contracts Law, on the basis of the lowest responsible quotation received, which quotation is most advantageous to the contracting unit, price and other factors considered; provided, however, that if the contracting agent deems it impracticable to solicit competitive quotations in the case of extraordinary, unspecifiable service, or, in the case of such or any other purchase, contract or agreement awarded hereunder, having sought such quotations determines that it should not be awarded on the basis of the lowest quotation received, the contracting agent shall file a statement of explanation of the reason or reasons therefor, which shall be placed on file with said purchase, contract or agreement. [N.J.S.A. 40A:11-6.1].

Casey Auto Parts v. City of Camden, supra, upon which Gannett relies in its argument that it is entitled to a hearing, did not rely on any statutory authorization for that hearing. We decline to follow Casey when there is a rejection of all bids, as contrasted with the rejection of the lowest bid in favor of another bidder who is considered the lowest responsible bidder. Moreover, Casey ...


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