Builders and Contractors Exchange
Weekly Bulletin: 08 Aug 2005
OOPS: Can I Have That Bid Back?
By: Neil Lowenstein
You just left bid opening and won. What a great initial feeling. But then you start thinking about it a little more, particularly the fact that you were so much lower than everyone else, now you begin to worry. When you get back to the office, you review your bid file and notice you made a mistake in your bid. Now what?
If your bid was for a public project covered by the Virginia Public Procurement Act, you may have the chance to withdraw your bid. However, the error must be either (i) a clerical mistake; (ii) an unintentional arithmetic error; or (iii) an unintentional omission of a quantity of work, labor or material made in the compilation of the bid. Judgment errors do not apply, although if the bid has mixed mistakes including judgment errors it can still be withdrawn if its price was substantially lower than the other bids solely because of the non-judgment errors.
The error must be objectively demonstrable from the original work papers, documents and materials used in the preparation of the bid. The Virginia Code requires the public body to include one of the following two withdrawal procedures in the solicitation: (i) the bidder give written notice of right to withdraw within two business days of the bid opening and submit original working papers with that notice; or (ii) the bidder submit original working papers, documents and materials used in the bid preparation within one day after the date fixed for submission of bids, with the bidder then having two hours after bid opening to make written claim of mistake. Typically, public bodies use the former.
Public bodies can establish similar procedures for non-construction projects too, but they are not required or limited by the Virginia Code like they are for construction. Regardless, withdrawal is not allowed if it would result in award on another bid to the withdrawing bidder or to another bidder in which the withdrawing bidder has ownership of more than five percent. And, if the bidder withdraws, it may not, for compensation, supply any material or labor to or perform any subcontract or other work agreement for the person or firm that is awarded the contract, nor may the withdrawing bidder otherwise benefit, directly or indirectly, from the project.
When the public body allows the bid withdrawal, the lowest remaining bid becomes the lowest bid. If the public body denies the bid withdrawal, they must state why in writing, and that decision becomes final unless appealed within ten days. If no bid bond was posted, the bidder must post a certified check or cash bond for the difference in amount between its bid and the next lowest bidder before appealing. On appeal, the public body's decision stands unless it either was not an honest exercise of discretion or was not in accordance with the Virginia Constitution, applicable state law or regulation, or the terms or conditions of the procurement; both very high standards. If overturned, the sole available relief is withdrawal of the bid.
Hopefully, you never have this type of "Oops" feeling after bid opening, but if you do, contact one of the members of Vandeventer Black's Construction and Public Contracts Law Team.
Questions?
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This article is meant to bring awareness to this topic and is not intended to be used as legal advice.