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Suburban Disposal, Inc. v. Township of Fairfield

March 3, 2006


On appeal from the Superior Court of New Jersey, Law Division, Essex County, L-1144-05.

The opinion of the court was delivered by: Lisa, J.A.D.



Argued February 15, 2006

Before Judges Coburn, Collester and Lisa.

This is an appeal by an unsuccessful bidder, Suburban Disposal, Inc., from a summary judgment upholding the award by defendant Township of Fairfield of a three-year trash collection contract to defendant Waste Management of New Jersey, Inc. The contract included basic service, Alternate B (remove roll-off containers), and Alternate E (separate collection for white metal and goods). The Township chose, as it was permitted under the specifications, to award no bid for Alternate C (collection of school waste) or Alternate D (collection of grass clippings). However, without public bidding, Waste Management was, during its performance of this contract, actually collecting school waste and in negotiations with the Township regarding the price for the service.

Suburban argues that the contract award to Waste Management with Alternate E included was improper because Waste Management did not bid on Alternate E, but was permitted by the Township to change its "No Bid" after the bids were opened. Suburban further argues that the Township improperly avoided Alternate C by "hiring" Waste Management outside the bidding process to collect school waste. Finally, Suburban argues that we should not order a rebid but should declare the contract with Waste Management void and order that the contract be awarded for the balance of the three-year term to Suburban, on the terms contained in its bid proposal. We agree with all of Suburban's arguments and reverse.


The bid specifications, as originally advertised, provided for three options, one-year, three-year or five-year service, and, in addition to basic service, provided for Alternates B, C and D. Before it was time to open the bids, the Township issued an addendum adding Alternate E. The Township reserved the right to choose the contract duration option and any or all alternates, and "at its discretion, award the contract to the bidder whose aggregate bid price for the chosen option, or any combination of options is the lowest responsible bidder." The specifications further provided that the Township "shall not award the contract based on the bid price for separate options." Thus, one contract would be awarded. It could be for one, three or five years. It could be for basic service only, or basic service plus any or all of the alternates. Bidders were "invited to bid on all or any Option Proposal." No bid could be withdrawn for sixty days after bids were opened.

Basic service provided generally for collection of residential waste, but specifically excluded recyclables. The addendum defined Alternate E as follows:

Provide a separate collection twice per month per collection route for White Metal and Goods. Disposal shall be by the contractor at no cost to the Township. Certified weight slips shall be provided to the Township for purposes of recycling accounting.

Although basic service required collection of bulky items, "white goods," such as refrigerators, are designated as recyclables and are not subject to landfill disposal. Alternate E therefore imposed an additional burden on a contractor, to separately collect these items and dispose of them at a separate facility. Waste Management held the Township's trash collection contract immediately preceding the contract that is the subject of this appeal. Its practice was to collect all bulky items as part of the basic service, commingling white goods with other bulky items. There was apparently no provision in the prior contract comparable to Alternate E requiring separate collection and disposal of white goods.

The bid proposal forms contained three sheets, one for each of the duration options. Each sheet contained a column for basic service and a column for each alternate. The bid sheets contained this statement above the columns: "The undersigned will contract to do all of the work and furnish all the materials, labor, equipment, etc. . . . for." Because the Township chose the three-year option, we will focus on the bids for that option. Each column contained three lines on which to insert the prices for years one, two and three, and a fourth line for the total. A signature line was provided for the bidder.

Before discussing the bid amounts, we note that Alternate B was a very minor item, requesting a unit price for each roll-off container required by the Township to be pulled. Only about fifteen pulls per year were anticipated, and the unit prices submitted by the various bidders were close in amount. Without dispute, the Alternate B bids would not ...

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