Case Law Alerts
General contractor's inclusion of subcontractor's bid in GC's bid is not acceptance of subcontractor's bid and does not form contract between subcontractor and GC or client.
The subcontractor (SC) gave a bid to a general contractor (GC) for a municipal authority project. GC included SC's bid within its own, and the authority awarded the contract to GC. However, GC did not hire SC to perform the work on which SC had bid, instead giving that work to another subcontractor after a 30-day substitution period had expired. SC sued GC and the municipality for breach of contract, claiming that GC's use of SC's bid to get the award constituted a contract between them and that once the 30-day substitution period expired, GC was not permitted to give the work to another subcontractor. The court disagreed, ruling that there was no contract between the parties that could have been breached. Rather, SC made an offer to GC, but GC did not expressly accept it. The use of SC's bid proposal by GC in its bid, and the authority's subsequent acceptance of GC's bid, was not an acceptance of SC's bid by GC or the authority. As SC was neither a party to GC's contract with the authority nor a third-party beneficiary, SC could not enforce any of the terms of the GC's contract with the authority.
Case Law Alert, 3rd Qtr 2012, July