Opinion
February 8, 1973
Appeal from the Civil Court of the City of New York, County of New York, PATRICK J. PICARIELLO, J.
Norman Redlich, Corporation Counsel ( Stanley Buchsbaum and Edmund B. Hennefeld of counsel), for appellant.
Klein Feinstein, P.C. ( Sheldon Feinstein of counsel), for respondent.
In September, 1969, the Board of Education advertised for bids to rebuild a brick chimney at Public School No. 41, Richmond. On September 16, 1969, which was the bid opening date, plaintiff submitted a bid that turned out to be the lowest. On September 18, 1969, plaintiff received a letter by certified mail directing it to proceed immediately with work. The letterhead of this missive is that of the Board of Education, Office of School Buildings. It was signed by Hugh S. Houston, Director, Bureau of Maintenance. On September 26, 1969, plaintiff was sent another letter bearing the same letterhead and subscribed by the same individual which stated that the letter, dated September 18, 1969, is hereby rescinded. This second letter gave as reason for the rescission the advice to the writer's office by the City Comptroller that the "contract was not properly advertised in the City Record for a period of ten days as required by law, and accordingly, the contract will not be registered for payment." It is noteworthy that this letter also stressed the urgency of the work and advised plaintiff to contact the Office of School Buildings if it was interested in performing the work by means of an "Oral Order".
Thereafter this suit was brought for breach of contract (alleging damage in the amount of $4,000) and for work, labor and services performed at the school in the sum of $4,000, the alleged reasonable value of such work, labor and services.
Patently, the work, labor and materials involved herein could be obtained only by contract on public letting founded on sealed bids under such regulations as made by the Board of Estimate (New York City Charter, § 343; cf. General Municipal Law, § 103). Pursuant to resolution of the Board of Estimate, bids for contracts shall be solicited by public advertisement in at least 10 successive issues of the City Record with certain exceptions (Board of Estimate Resolution No. 318-A, as amd. by § 1. [a]). Plaintiff, on this record, does not dispute defendant's declaration that the invitation for bids was not properly advertised. Accordingly, as the specified manner for the making of a valid contract was not adhered to, the contract is invalid. "No implied contract to pay for benefits furnished by a person under an agreement which is invalid because it fails to comply with statutory restrictions and inhibitions can create an obligation or liability of the city" ( Seif v. City of Long Beach, 286 N.Y. 382, 387). As the public letting of the contract was not in accordance with the applicable regulations made by the Board of Estimate, no authority to make the contract existed. "The doctrine of implied contract cannot be invoked to do rough justice and fasten liability where the legal requirements specifically prohibit" ( Lutzken v. City of Rochester, 7 A.D.2d 498, 499 [4th Dept., 1959]). Plaintiff has clearly demonstrated the equities of its claim. This, however, is insufficient to create liability on defendant's part ( Seif v. City of Long Beach, supra; Lutzken v. City of Rochester, supra; Steiner Egg Noodle Co. v. City of New York, 63 Misc.2d 163 [App. Term, 1st Dept.], affd. 34 A.D.2d 892).
The absence of legal remedy may not, of course, bar plaintiff from applying to the Board of Estimate for consideration of the claim on equitable grounds as provided in section 93d-3.0 of the Administrative Code of City of New York. The manifest nature of the equitable grounds demonstrated by plaintiff on this record prompts the observation that plaintiff would be clearly entitled to relief were the defendant other than a governmental agency.
The order granting plaintiff summary judgment should be reversed, without costs; plaintiff's motion for summary judgment denied, and defendant's cross motion for summary judgment granted.
Special Term granted plaintiff summary judgment with an assessment of its damages. I would affirm.
Defendant advertised for bids to rebuild a chimney for a public school. When plaintiff's $9,400 bid was found to be lowest, defendant by certified mail "directed" plaintiff "to proceed immediately" with the performance of the work (letter, Sept. 18, 1969). The need for speed was emphasized by the sentence in the letter reading: "It is imperative that this work be undertaken immediately and progressed expeditiously." The letter was subscribed by the Director of the Bureau of Maintenance and approved by the Director of the Division of Maintenance and Operation.
Plaintiff complied with this urgent appeal. For its pains, some eight days later, namely, on September 26, 1969, the same Director of the Bureau of Maintenance who urged speed in his earlier letter wrote that the Comptroller refused to register the contract because the advertisement for bids had not been advertised in the City Record for 10 days. But again, the Director observed that the work was "urgent and must be undertaken without further delay."
In the interval between the letters plaintiff had performed a substantial amount of work. Defendant refused to pay for this work, and despite the apparent urgency, refused to permit plaintiff to perform further work; and plaintiff now sues for its damages.
On the uncontroverted facts plaintiff has a cause of action for its damages ( Village of Lake George v. Town of Caldwell, 3 A.D.2d 550, affd. 5 N.Y.2d 727; People ex rel. Lunney v Campbell, 72 N.Y. 496; Pennell v. Mayor, etc. of City of New York, 17 App. Div. 455; Lynch v. Mayor, etc. of City of New York, 2 App. Div. 213; see, also, Kooleraire Serv. Installation Corp. v. Board of Educ. of City of N.Y., 28 N.Y.2d 101, 106; Van Dolsen v. Board of Educ. of City of N.Y., 162 N.Y. 446, 452; People ex rel. Kiehm v. Board of Educ. of City of Utica, 198 App. Div. 476, 480, 481; see, also, Industrial Eng. Co. v. Republic Stor. Co., 220 App. Div. 178).
In People ex rel. Lunney v. Campbell ( supra, p. 498), the Court of Appeals said: "There appears to be no question that if the proceedings were all regular and conducted according to law as is asserted, and the relator has in all respects conformed to the provisions of the city charter, that he has a right of action against the city for all damages which he has sustained, by reason of the refusal of the commissioner to execute and carry out the contract."
In Lynch v. Mayor, etc. of City of New York ( supra), plaintiff sued for damages in consequence of the defendant's refusal to execute a contract whereby plaintiff was to perform certain work in the construction of a sewer. Plaintiff presented a bid pursuant to an advertisement and he was thereafter notified that his bid was the lowest and that the contract had been awarded to him. Six days later, the Commissioner notified plaintiff that his bid was rejected on account of an irregularity therein, and defendant refused to execute the formal contract. The court ruled that the proposal by the plaintiff and the acceptance thereof by the Commissioner constituted a contract binding upon both, and that it was then too late to reject all bids. Plaintiff was held entitled to judgment for his damages.
The failure to publish the advertisement for the total number of days called for by the Board of Estimate regulations was merely an irregularity. It was made manifest to plaintiff only after its bid had been accepted and it had worked on the project for eight days. Since the irregularity arose from the act of defendant, not that of plaintiff, the latter's bid could no longer be rejected at that time.
The fact that the Comptroller would not register the contract does not alter the situation. A party to a contract cannot rely on the failure of another to perform a condition precedent where he has frustrated or prevented the occurrence of the condition. The Board of Education may not take advantage of the failure to register the contract where it was the Comptroller who made registration impossible ( Kooleraire Serv. Installation Corp. v. Board of Educ. of City of N.Y., 28 N.Y.2d 101, 106). "Defenses by official boards resting upon their omission to do the acts they had the power to do in order to perfect the authority they assumed to exercise, are not favored when invoked against innocent parties dealing with them in good faith." ( Van Dolsen v. Board of Educ. of City of N.Y., 162 N.Y. 446, 452, supra; People ex rel. Kiehm v. Board of Educ. of City of Utica, 198 App. Div. 476, 480, 481, supra).
This court should not be astute to enable the Board of Education to disavow its just commitment, or to conduct itself respecting any such commitment in a manner violative of fair dealing, which would not be sanctioned were natural persons the parties involved ( Lowe v. City of New York, 240 App. Div. 484, 489).
Under the facts at bar justice does not require putting plaintiff to the time, inconvenience and expense of applying for the grace of the Board of Estimate under section 93d-3.0 of the Administrative Code of City of New York, as suggested by my brethren. In my view, it is entitled to recovery, not as a matter of grace, but as a matter of right.
I therefore dissent.
QUINN and LUPIANO, JJ., concur in Per Curiam opinion; MARKOWITZ, P.J., dissents in memorandum.
Order reversed, etc.