CONTRACTS - MUNICIPAL CORPORATIONS - REVOCABILITY OF OFFER SUBMITTED UNDER STATUTORY COMPETITIVE BIDDING

Authors

Richard H. Conn, University of Michigan Law School

Abstract

In accordance with statutory provisions, the city commissioners of Atlantic City advertised for bids for certain public improvements. Plaintiff submitted a sealed bid accompanied by a deposit of $5,000, as required by the advertisement, to guarantee execution of the contract if it were the successful bidder. When the bids were opened, plaintiff was the lowest bidder by a considerable margin. Investigation disclosed that an appreciable error had been made in the calculation of its bid, however, and before any official action had been taken, plaintiff advised the city commission of the mistake and withdrew the bid. Nevertheless, the contract was subsequently awarded to plaintiff, and on its refusal to perform, the $5,000 was declared forfeited. In a suit in equity for return of the deposit, held plaintiff may recover $5,000. A competitive bid is in the nature of an option to the municipality and may not be withdrawn, but equity may grant relief by way of rescission of the bid on the basis of mistake. Conduit & Foundation Corp. v. Atlantic City, (N.J. 1949) 64 A.(2d) 382.

Recommended Citation

Richard H. Conn, CONTRACTS - MUNICIPAL CORPORATIONS - REVOCABILITY OF OFFER SUBMITTED UNDER STATUTORY COMPETITIVE BIDDING, 47 Mich. L. Rev. 1220 (1949).
Available at: https://repository.law.umich.edu/mlr/vol47/iss8/18