The city of Chicago acted in the best interests of its residents and taxpayers, as well as within its discretion under the law, when it awarded a 2007 and 2008 road construction contract to a company that was the second lowest bidder, an appeals court panel ruled.
In an unpublished order filed Aug. 23, a panel of the First District Appellate Court affirmed the decision of Cook County Circuit Judge Sanjay Taylor, who had ruled in favor of the city in its dispute with road construction contractor, Acura Inc., of Bensenville.
The judgment was delivered by Justice Jesse Reyes, and Justices Bertina Lampkin and Shelvin Louise Marie Hall concurred.
The case arose from a bid dispute between Acura and the city dating back to 2008.
In June 2008, the city agreed to partner with the Illinois Department of Transportation (IDOT) on certain highway ramp maintenance and repair projects for 2007 and 2008.
The city was to use federal money, distributed by IDOT, to cover 80 percent of the projects’ $10 million cost. The city would pay the remaining 20 percent.
The city sought bids in late 2008, and opened the bids for the project on Dec. 30, 2008.
In January 2009, the city identified Acura as “the lowest responsible responsive bidder.”
However, an IDOT review later challenged Acura’s financial ability to carry out the work, as the state agency said its review of the contractor’s finances showed the project would exceed Acura’s financial capability by $4.94 million.
City officials initially disagreed with IDOT’s determination, saying they believed Acura had the financial capability of about $10 million, enough to cover the project. They also asked IDOT to support Acura’s award, noting the firm was minority-owned and that the award would give an “opportunity for them (Acura) to build capacity.”
IDOT did not concur, however, and instructed the city to award the bid to the second lowest bidder, G&V Construction, also of Bensenville.
On April 22, 2009, fearing that its allotment of federal money for the project could otherwise be in jeopardy, the city awarded the bid to G&V.
In May 2009, Acura filed a bid protest. And when the bid protest failed to elicit a response from the city, Acura in September 2009 filed suit.
In its suit, Acura argued the bid process had cost it a great deal of money and time, and that the city had misrepresented the bid process by awarding a contract to a firm that was not “the lowest responsible bidder.”
Acura asked the court to order recovery of its costs, fees and expenses related to the bid process.
In March 2012, the city of Chicago asked the court for summary judgment. Lawyers for the city argued that the bid process was carried out legally and properly and that no contract had ever been promised to Acura.
In July 2012, the trial court granted the city’s motion, prompting Acura to appeal a month later.
In its recent order, the appellate court sided with the city and the trial judge.
Writing for the panel, Reyes explained that Acura had not filed the proper paperwork in a timely enough fashion to demonstrate its capability to finance the $10 million package of road projects.
Additionally, Reyes wrote that the city “followed its established procedures in awarding” the bid to G&V.
The appeals panel also determined that the city acted in the best interests of the public by acting at IDOT’s guidance, thus ensuring the collection of the 80 percent federal funding for the road construction projects for which Acura had bid.
“Acura is presumed to know the city could award a contract to one who is not the lowest bidder, when this is done in the public interest and not for corrupt or arbitrary reasons,” Reyes wrote in the court's order.
He added, “The city, acting in accordance with its established policy, had a sound and reasonable basis for the award as made."