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The Original W. Hargrove Demolition, Inc v. City of Camden

February 16, 2012

THE ORIGINAL W. HARGROVE DEMOLITION, INC., PLAINTIFF-RESPONDENT,
v.
CITY OF CAMDEN, DEFENDANT.



On appeal from the Superior Court of New Jersey, Law Division, Camden County, Docket No. L-0627-11.

Per curiam.

NOT FOR PUBLICATION WITHOUT THE APPROVAL OF THE APPELLATE DIVISION

Submitted: December 21, 2011

Before Judges Axelrad, Sapp-Peterson and Ostrer.

Intervenor Ace Auto Parts, Inc. (Ace) appeals from a June 13, 2011 order of the Law Division, setting aside the City of Camden's (City) award to it of the contract for removal and storage of abandoned, disabled, and impounded vehicles and directing the award of the contract to plaintiff, the Original W. Hargrove Demolition, Inc. (Hargrove). The City found disqualifying material defects in Hargrove's bid, consisting of insufficient zoning of its storage facility, lack of the requisite towing equipment, and insufficient proof of experience and recommendations. It awarded the contract to Ace, the second lowest responsible bidder. The court found any defects, if existing, were immaterial and the City was arbitrary and capricious in rejecting Hargrove's bid. On appeal, Ace challenges the court's rulings as to each of the components of Hargrove's bid that were rejected by the City. We reverse and vacate the order.

I.

On August 30, 2010, the City published an invitation for bids for a two-year contract to provide removal and storage of abandoned, disabled and impounded vehicles under Bid #10-12. Hargrove and Ace each submitted bids by the November 4 due date.*fn1

In response to a protest from Ace, on February 1, 201l, the City Attorney sent a letter to both bidders, noting his review and input from the City Business Administrator, City Bureau of Purchasing, and the State Department of Community Affairs, Division of Local Government Services. He explained his recommendation that City Council (Council) disqualify Hargrove's bid as materially noncompliant with the specifications in three respects and declare Ace the lowest responsible bidder. The award of the towing contract was scheduled for the February 8 Council meeting but was rescheduled for March 1 to afford the bidders an opportunity to submit testimony and evidence regarding the City Attorney's recommendation.

On February 4, Hargrove filed a Verified Complaint in Lieu of Prerogative Writs and an Order to Show Cause seeking to preliminarily enjoin the City from disqualifying Hargrove's bid and awarding Ace the contract. The City filed opposition. Ace filed a motion to intervene, which was granted.

Following oral argument on February 8, the court granted temporary restraints pending the February 25 return date, which was converted to a case management conference. By order of February 25, the court permitted Council to take testimony and award the bid, subject to judicial review. At the March 1 Council session, Ace submitted additional documentation in support of disqualification of Hargrove's bid; Hargrove presented no testimony or documentation. Council rejected Hargrove's bid as containing material defects and awarded the towing contract to Ace, memorialized in Resolution MC-11:1590.

By order of April 14, 2011, the court granted Ace's motion in limine to supplement the record with the additional information it had submitted to Council. On the same date, the court heard oral argument on Hargrove's challenge, and directed counsel to submit supplemental briefs. On June 3, the court rendered its oral decision, concluding, "the City acted in an arbitrary and capricious manner when it rejected the Hargrove proposal to Bid Number [10-12]. Any defects, if existing, were immaterial. Hargrove is therefore declared to be the lowest responsible bidder . . . ; and accordingly, shall be awarded the contract resulting therefrom." Ace filed a motion for a stay pending appeal, which the court denied by order of June 13, 2011.

On June 17, 2011, Ace filed a notice of appeal, followed by a motion for a stay of the trial court's order. By order of July 15, we denied the stay but accelerated the appeal.

Ace raises the following arguments on appeal:

POINT I

THE TRIAL COURT ERRED IN RULING THAT THE CITY'S DECISION THAT HARGROVE'S BID WAS NOT COMPLIANT WITH THE BID SPECIFICATIONS BECAUSE HARGROVE'S PROPOSED STORAGE LOT WAS NOT ZONED TO PERMIT THE STORAGE OF ABANDONED, DISABLED AND IMPOUNDED VEHICLES WAS ARBITRARY AND CAPRICIOUS.

l. The City's Decision In Awarding A Municipal Towing Contract Is Entitled To Deference And Can Only Be Overturned Where It Is Arbitrary And Capricious.

2. The City's Disqualification Of The Hargrove Bid Cannot Be Determined To Be Arbitrary And Capricious Where The Bid Contained Material Defects.

3. The City Had A Rational Basis To Determine That Hargrove's Storage Facility Is Not Zoned To Allow For Performance Of This Contract, Constituting A Material Defect In Its Bid.

4. The Trial Court Improperly Considered Facts Outside The Record To Overturn The City's Award.

5. The Hearsay Evidence Improperly Considered By The Trial Court Does Not Make The City's Determination That The Hargrove Bid Lacked Proper Zoning Arbitrary And Capricious.

A. The Prior Use Of The Hargrove Lot Was Abandoned And Extinguished Pursuant To Section 577-167 ...


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