Upon the following papers numbered 1 to 67 read on this Article 78 petition & motions to dismiss; Notice of Motion/Order to Show Cause and supporting papers 1-16 (#01), 17-23 (#02) & 23-33 (#03); Answering Affidavits and supporting papers 34-35 (#02 & 03); Replying Affidavits and supporting papers 36-43 (#02) & 44-48 (#03); Other sur-reply 49-54; sur-reply 55-56 (#02) 57-67 (#03); it is,For a Judgment Pursuant to Article 78 of the Civil Practice Law and Rules In this combined CPLR Article 78 and declaratory judgment action, the petitioner, Ronald Webb Builders, LLC, hereinafter referred to as “Webb”, seeks to set aside resolution 2018-158 granted by respondent, Town Board of the Town of Southampton, hereinafter referred to as “Board”, which awarded the general construction contract for the “Final Phase Restoration of Nathaniel Rogers House” to respondent Lipsky Enterprises, Inc., hereinafter referred to as “Lipsky”; and declare that Webb is the lowest responsible bidder and therefore should be awarded the contract. The respondents, Town of Southampton, hereinafter referred to as “Town”, the Board and Lipsky, oppose this application and separately move to dismiss the petition pursuant to CPLR 3211(a)(5) and (7). Webb opposes the motions to dismiss in all respects and filed an amended petition. Subsequent to the filing of the amended petition the Court granted leave for the petitioner to file a sur-reply and the respondents to file sur sur-replies.The Town acquired the “Nathaniel Rogers House” in 2003 for approximately $3.1 million dollars with the intention of restoring the structure for public use and enjoyment. The Nathaniel Rogers House is a circa 1820s three-story home located on Montauk Highway in Bridgehampton, New York. The Town retained Jan Hird Pokorny Associates, hereinafter referred to as “JHPA”, to prepare contract documents, including drawings and specifications for the restoration project. JHPA prepared both “Drawings for General Construction” and “Specifications for General Construction”, hereinafter referred to as “Drawings” and “Specifications”, for the restoration project. On November 14, 2017 the Town adopted resolution 2017-1003 which gave “Notice to Bidders for Final Phase of Restoration of Nathaniel Rogers House”. The resolution required that the sealed bids were to be received by the Town Clerk on December 27, 2017. The Drawings and Specifications were to be used by the contractors placing bids on the restoration project. The Drawings include items described as “Alternates”. Each contractor was to set a monetary amount for the Alternates separately from their base bids. Webb submitted a base bid of $3,403,299.00 plus a bid for Alternates of $459,900.00, for a total bid of $3,863,199.00. Lipsky submitted a base bid of $3,338,650.00 plus a bid for Alternates of $613,000.00, for a total bid of $3,951,650.00. Webb acknowledges that Lipsky’s base bid was the lowest base bid but states that its total bid including Alternates was the lowest responsible bid and therefore it should have been awarded the contract. Webb filed this action to challenge the determination of the Board that Lipsky’s bid was the lowest responsible bid received.In opposition to the petition and support of their motion to dismiss the Town and Board claim that “the base bids came in for more money that the Town anticipated…Therefore, there was no money in the budget to complete the ‘add on’ items that were included in the proposal request”. The Town and Board argue that the Board’s decision was supported by a rational basis and without taking the Alternates into account Lipsky had the lowest responsible bid, thereby requiring it to be awarded the contract.In opposition to the petition and support of its motion to dismiss Lipsky claims that the petitioner has failed to state a cause of action against it. Lipsky claims that the proposal form itself indicated that the Town could use the base bid or the bid with Alternates in determining who the lowest responsible bidder is. The Proposal Form at page PF-11, under the heading Reservation of Rights, statesThe Town Board reserves the right to award this entire Contract to the lowest qualified bidder, or to award individual items of the bid to separate vendors…In awarding this Contract, the Town is not bound by the quantities stated in the Bid Form. It is emphasized that the quantities are approximations only. No guarantee is made for any quantities stated nor is a guarantee made for the total bid or alternate total bid. Such total bid or alternate total bid are for the purpose of guidance in awarding the Contract only.The petitioner in opposition to the motions to dismiss filed an Amended Verified Complaint wherein it alleges that the Town “acted in bad faith, improperly, and without statutory or lawful basis when it changed the scope of the Drawings and Specifications” upon which the Webb and Lipsky bids were based.The Court in Acme Bus Corp. v. Bd. of Educ., 91 NY2d 51, 54-56 [1997], held thatThe court concluded that the selection process did not indicate “favoritism, collusion or fraud” but, rather, appeared “to be in the best interest of the taxpayers and students of the Roosevelt Union Free School District.”…We have stated that the laws requiring competitive bidding were designed to benefit taxpayers rather than corporate bidders and, thus, should be “construed and administered ‘with sole reference to the public interest’” (Matter of Conduit & Found. Corp. v. Metropolitan Transp. Auth., 66 NY2d 144, 148 [citation omitted]; see also, General Municipal Law §100-a). As we recognized in Matter of New York State Ch., Inc., Associated Gen. Contrs. v. New York State Thruway Auth. (88 NY2d 56), there are: “two central purposes of New York’s competitive bidding statutes, both falling under the rubric of promoting the public interest: (1) protection of the public fisc by obtaining the best work at the lowest possible price; and (2) prevention of favoritism, improvidence, fraud and corruption in the awarding of public contracts” (id., at 68)…Petitioner has the burden to demonstrate “actual” impropriety, unfair dealing or some other violation of statutory requirements when challenging an award of a public contract (Matter of Conduit & Found. Corp. v. Metropolitan Transp. Auth., supra, at 149-150; see also, Janvey & Sons v. County of Nassau, 60 NY2d 887, 889; Matter of Baumann & Sons Buses v. Board of Educ., 46 NY2d 1061). Here, petitioner concedes that the school board has the right to solicit bids in alternative categories and to select the lowest responsible bidder in either category (see, Matter of Bimco Indus., 11 Ed Dept Rep 191, 192 ["It is well settled that a board of education may ask for bids in the alternative and that it may exercise reasonable discretion in the selection of the alternative it desires"]).The Court in Cestone v. Evans, 281 AD 359, 362-363 [3d Dept 1953], dealt with a similar fact pattern and noted thatThe contract documents indicated clearly that the decision as to the base or alternate route for section 1 was to be made by the town board. No claim is made that the board acted in bad faith or practiced any fraud whatsoever. It had a clear right to reject all bids on the alternate route and to select the base route. Having done so, the only question remaining was “the single responsible bidder” or “the combination of separate responsible bidders, as determined by the Town Board of the Town of Elmira and the terms and conditions of these Contract Documents, whose total price for both sections of the work is the least amount.” The award to Di Marco was properly made.In the present action the proposal form itself indicates that the Town and Board could choose to award the contract based upon the total bid, also known as the base bid, or the alternate bid. Once the Town and the Board opened the sealed bids they were then in the position to determine that there was not enough money in the budget to allow for the “Alternate” items to be completed. The lowest responsible bid for the base items was submitted by respondent Lipsky.Upon reviewing the petition and the motions to dismiss the Court notes that Webb has failed to satisfy its burden to demonstrate “actual impropriety, unfair dealing or some other violation of statutory requirements” in challenging the award of the contract to Lipsky. While Webb does claim in its amended verified petition that the Town and Board acted in bad faith, it has not made the necessary prima facie showing of bad faith. Webb acknowledged that Lipsky submitted the lowest base bid in connection with the restoration project. The Town has shown that Lipsky was awarded the contract in the amount of its base bid, $3,338,650.00. Therefore, the motion by the Town and the Board to dismiss the petition is granted.Respondent Lipsky’s motion to dismiss is similarly granted.The Article 78 petition is dismissed as to all respondents.The foregoing shall constitute the decision and Order of this Court.Dated: June 12, 2019
