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Meco, Inc v. Township of Freehold

April 13, 2011


On appeal from the Superior Court of New Jersey, Law Division, Monmouth County, Docket No. L-1466-09.

Per curiam.


Argued February 16, 2011

Before Judges Sapp-Peterson and Fasciale.

This is an appeal from the trial court order granting the Township of Freehold (Township) summary judgment dismissing plaintiff, Meco, Inc.'s (Meco) complaint arising out of a contract dispute. We affirm.

The contract arose from the Township's solicitation of bids for the improvement and resurfacing of a public roadway. The bid package released to prospective bidders contained the following provisions which are relevant to this appeal.


H. Bidders must insert prices for furnishing all of the materials and/or labor required by these specifications. Prices shall be net, including any charges for packing, crating, containers, etc. . . .


A. The bidder understands and agrees that its bid is submitted on the basis of the specifications prepared by the OWNER. The bidder accepts the obligation to become familiar with these specifications.

B. Bidders are expected to examine the specifications and related documents with care and observe all their requirements. Ambiguities, errors or omissions noted by bidders should be promptly reported in writing to the appropriate official. In the event the bidder fails to notify the OWNER of such ambiguities, errors or omissions, the bidder shall be bound by the bid.

C. No oral interpretation of the meaning of the specifications will be made to any bidder. Every request for an interpretation shall be in writing, addressed to the OWNER'S representative stipulated in the bid. In order to be given consideration, written requests for interpretation must be received at least seven (7) days prior to the date fixed for the opening of the bids. . . .


The Standard Specifications for Road and Bridge Construction of the New Jersey Department of Transportation, 2001 Edition is added to and/or amended elsewhere herein by the Proposal, General Conditions, Special Provisions and Supplementary Specifications; shall, insofar as technical requirements are involved, govern in the execution of this project.

Such Standard Specifications are made a part of these Specifications by this reference and will not be repeated herein. . . .

The Notice to Bidders (Advertisement), Proposal, General Conditions, Special Provisions and/or Supplementary Specifications shall govern and prevail in the case of conflict between them and the Standard Specifications.

Public bidding on the contract opened on April 9, 2008, and in accordance with the contract terms, the contract period commenced within fourteen days of the "issuance of the 'Notice to Proceed'" and required completion by August 31, 2008.

Meco submitted a bid in the amount of $876,921. Its bid contained the following unit prices for asphalt concrete: 15,680 square yards of Bituminous Stabilized Base Course Mix I-2 (Item 3.1) at $13.50, totaling $211,680; 350 tons of Bituminous Concrete Leveling Course Mix I-5 (Item 3.2) at $1.00, totaling $350; and 3,570 tons of Bituminous Concrete Surface Course (Item 3.3) at $69.50, totaling $248,115.

On April 22, 2008, the Township adopted Resolution No. R- 08-123, awarding Meco the contract as the lowest responsible bidder. That same day, Meco and the Township entered into Contract No. 08-08, which memorialized the terms of the bid package. On April 23, the Township issued a purchase order for the contract. Thereafter, Meco commenced work on the project.

Pursuant to the prices in the contract, Meco submitted the following invoices for payment, which the Township subsequently paid: $67,288.77 on June 3, 2008, paid on June 17, 2008; $144,858.18 on June 27, 2008, paid on July 29, 2008; $209,907.94 on August 1, 2008, paid on August 26, 2008; $374,607.77 on August 29, 2008, paid on September 23, 2008; $58,320.73 on September 16, 2008, paid on October 17, 2008; and $17,448.64 on September 24, 2008, paid on July 14, 2009. On September 24, 2008, the Township issued a change order reducing the final total by $4,488.97 due to the utilization of less material.

On August 4, 2008, Meco submitted a written change order request to cover the costs of the "asphalt escalation" in the amount of $36,678.75. In its request, Meco acknowledged that there was no "line item in the proposal for asphalt escalation[,]" but suggested that the contract incorporated § 404.25 of the NJSS*fn1 which set the guidelines for "determining the asphalt price adjustment." According to the Asphalt Cement and Fuel Price Index that Meco included with its request, the price per ton of asphalt cement was $410 in April 2008, $447.50 in May 2008, $517.50 in June 2008, $625 in the first half of July 2008, $700 in the second half of July 2008, and $822.50 in August 2008.

On August 27, 2008, the Township denied Meco's request and based its denial on the fact that the "price which was bid by Meco is not a technical requirement which would be amended by the State specifications." The letter also noted that because Meco failed to notify the Township of any ambiguity in the bid package, Meco, in accordance with Paragraph B of "Interpretation and Addenda," was "'bound by the bid.'" After receiving this correspondence, Meco continued to perform the contract and submitted three ...

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