Pennsylvania Act 1974-4 — PUBLIC CONTRACT BID WITHDRAWAL LAW

Act text

PUBLIC CONTRACT BID WITHDRAWAL LAW
                   Act of Jan. 23, 1974, P.L. 9, No. 4                Cl. 62
                                  AN ACT

     Prescribing the procedure, after the opening of bids, for the
        withdrawal of bids on certain public contracts, setting forth
        the rights of the parties involved and providing penalties.

        Compiler's Note:  Section 6 of Act 57 of 1998 provided that
            Act 4 is repealed insofar as it relates to Commonwealth
            agencies as defined in 62 Pa.C.S. § 103 except insofar as
            Act 4 applies to the leases of real property.

        The General Assembly of the Commonwealth of Pennsylvania
     hereby enacts as follows:

        Section 1.  As used in this act:
        (1)  "Contracting body" means any officer, employe,
     authority, board, bureau, commission, department, agency or
     institution of the Commonwealth of Pennsylvania, or any State-
     aided institution, or any county, city, district, municipal
     corporation, municipality, municipal authority, political
     subdivision, school district, educational institution, borough,
     incorporated town, township, poor district, county institution
     district, other incorporated district or other public
     instrumentality, which has authority to contract for the
     construction, reconstruction, demolition, alteration or repair
     of any public building, or other public work or public
     improvement or for the provision of services to or lease of real
     or personal property whether by lease or concession from such
     contracting body, excepting highway work.
        (2)  "State-aided institutions" shall mean and include any
     institution which receives State funds directly or indirectly
     for the construction, reconstruction, demolition, alteration or
     repair of its buildings, works or improvements, excepting
     highway work.
        Section 2.  A bidder to any construction contract for the
     construction, reconstruction, demolition, alteration or repair
     of any public building or other public improvement or for the
     provision of services to or lease of real or personal property
     whether by lease or concession from such contracting body,
     excepting highway work, may withdraw his bid from consideration
     after the bid opening without forfeiture of the certified check,
     bank cashier's check, surety bid bond or other security filed
     with the bid if the price bid was submitted in good faith, and
     the bidder submits credible evidence that the reason for the
     price bid being substantially lower was a clerical mistake as
     opposed to a judgment mistake, and was actually due to an
     unintentional and substantial arithmetical error or an
     unintentional omission of a substantial quantity of work, labor,
     material or services made directly in the compilation of the
     bid; provided, (i) notice of a claim of the right to withdraw
     such bid is made in writing with the contracting body within two
     business days after the opening of bids; and (ii) the withdrawal
     of the bid would not result in the awarding of the contract on
     another bid of the same bidder, his partner, or to a corporation
     or business venture owned by or in which he has a substantial
     interest. No bidder who is permitted to withdraw a bid shall
     supply any material or labor to, or perform any subcontract or
     other work agreement for any person to whom a contract or
     subcontract is awarded in the performance of the contract for
     which the withdrawn bid was submitted, without the written
     approval of the contracting body. The contracting body may
     prepare regulations to carry out the intent and purposes of the
     act.
        Section 3.  If a bid is withdrawn in accordance with the
     provisions of this act, the contracting body may award the
     contract to the next lowest bidder or reject all bids and
     resubmit the project for bidding. In the event the contracting
     body resubmits the project for bidding the withdrawing bidder
     shall pay the costs, in connection with the resubmission, of
     printing new contract documents, required advertising, and
     printing and mailing notices to prospective bidders, if the
     contracting authority finds that such costs would not have been
     incurred but for such withdrawal. In no event shall the
     withdrawing bidder be permitted to resubmit a bid for the
     project.
        Section 4.  (a) If the contracting body intends to contest
     the right of a bidder to withdraw a bid, it shall hold a hearing
     thereon within ten business days after the opening of such bids
     and issue an order allowing or denying the claim of such right
     within five days after the hearing. The contracting body shall
     give to the withdrawing bidder timely and reasonable notice of
     the time and place of any such hearing. The contracting body
     shall make a stenographic record of all testimony and other
     evidence presented at the hearing. Such order may be arbitrated
     under the applicable terms of the bidding documents or, if the
     bidding documents contain no such provision for arbitration, the
     then current rules of the American Arbitration Association.
        (b)  If the contracting body denies the claim for withdrawal
     and the bidder elects to arbitrate the matter or otherwise
     refuses to perform, the contracting body may proceed immediately
     in accordance with the provisions of this act. If it is finally
     determined in accordance with the provisions of this section
     that the bidder did not have the right to withdraw the bid
     pursuant to the provisions of this act the certified check, bank
     cashier's check, surety bid bond or other security furnished as
     the proposal guaranty shall be forfeited as liquidated damages.
        Section 5.  Neither the contracting body nor any elected or
     appointed official, employe, representative or agent of such
     contracting body shall incur any liability or surcharge, in the
     absence of fraud or collusion, by permitting the withdrawal of a
     bid pursuant to the provisions of this act.
        Section 6.  Whoever violates section 2 of this act
     prohibiting a withdrawing bidder from supplying any labor or
     material or performing any subcontract for any person performing
     work on the construction project without the approval of the
     contracting body is guilty of a misdemeanor and shall, upon
     conviction thereof, be fined not more than twenty-five thousand
     dollars ($25,000) or undergo imprisonment for not less than one
     nor more than two years, or both.
        Section 7.  All acts and parts of acts, general, local and
     special, are repealed in so far as inconsistent herewith.
        Section 8.  This act shall not be applicable to any contract
     awarded pursuant to an invitation for bids issued on or before
     its effective date.
        Section 9.  This act shall take effect thirty days after its
     enactment.