In Skyline Contractors, Inc. v. Spokane Housing Authority (pdf), the Court of Appeals reaffirmed the principle that an aggrieved bidder on a public work contract is limited to seeking injunctive relief against the government. The Court of Appeals then extended this principal to a bidder that is awarded the public work contract and subsequently divested of its award. As a result of the Court’s holding, a bidder, whether successful or not, is precluded from seeking monetary damages against the government. Instead, it may seek only injunctive relief.
In February 2010, the Spokane Housing Authority issued an invitation for bids to furnish and install windows in a federally funded project. The invitation required that bidders have minimum experience and disclose the use, and identity of, subcontractors. In issuing its invitation to bid on the project, the Spokane Housing Authority stated that a “written award shall be furnished to the successful bidder within the period for acceptance specified in the bid and shall result in a binding contract without further action by either party.” The invitation also contemplated that the parties would later execute an Owner-Contractor Agreement. The Spokane Housing Authority later notified Skyline that it “shall be awarded the contract.”
After notifying Skyline of its decision, Spokane Housing Authority and Skyline held a preconstruction meeting in May 2010. At this meeting, Spokane Housing Authority raised concerns about Skyline’s failure to provide a copy of its contract with the subcontractor it had identified in bidding. The Spokane Housing Authority then notified Skyline that it would not execute its Owner-Contractor Agreement with Skyline until Skyline provided a signed subcontract.
The parties then held a second preconstruction meeting. At this meeting, Skyline again failed to provide the signed contract. It did, however, provide four signed contracts with different subcontractors. As a result, the Spokane Housing Authority concluded that that “Skyline is not a responsible bidder” and “rejecte[ed] Skyline’s bid for the project.” The Spokane Housing Authority then entered into an agreement with another bidder
The day after the Spokane Housing Authority rejected its bid, Skyline commenced an action for damages and injunctive relief. It also obtained a temporary restraining order, but chose not to post the required security. Subsequently, the Spokane Housing Authority moved for summary judgment on Skyline’s remaining claim for damages. The trial court granted the motion and awarded the Spokane Housing Authority its fees and costs.
Skyline appealed to the Court of Appeals, Division III, which affirmed.
The Court of Appeals addressed two points on appeal. First, the court held that the parties had a binding contract. To this end, the Court of Appeals concluded that the Spokane Housing Authority’s invitation for bids was not an offer; rather, Skyline’s bid was an offer that the Spokane Housing Authority accepted in awarding the public work contract to Skyline. This, the Court of Appeals, created a binding contract.
Second, after concluding that the parties had entered into a binding contract, and recognizing that the Spokane Housing Authority repudiated the agreement, the court turned to Skyline’s available remedies. The court noted that it is well established that an aggrieved bidder on a public works contract is limited to seeking injunctive relief; monetary damages are not available. The court then extended this rule to a successful bidder whose award is subsequently divested. Accordingly, the Court of Appeals held that Skyline’s exclusive remedy was to seek to enjoin the Spokane Housing Authority from entering an agreement with another bidder. Because Skyline failed to do so, the court noted, summary judgment was appropriate.
The Court of Appeals also awarded the Spokane Housing Authority its fees and costs under RAP 18.1(d).