555 P.3d 173
Haw.2024Background
- The Honolulu Board of Water Supply (BWS) issued a solicitation for a multi-million-dollar well-drilling project, including requirements for a C-27 license for tree trimming and removal.
- Alpha, Inc. submitted a bid without a C-27 license or a listed subcontractor for tree trimming; BWS disqualified Alpha and awarded the contract to the only other bidder, Beylik.
- Alpha protested BWS’s decision, arguing their C-17 license sufficed and that their subcontractor’s portion was less than one percent of the bid, thus not needing to be listed.
- Alpha's protest was rejected administratively (OAH), by the circuit court, and then by the ICA, primarily over the license and subcontractor listing requirements.
- Jurisdiction for procurement protests under Hawaiʻi law requires that the dispute concern an issue worth at least 10% of the contract's value for contracts over $1 million, a point disputed throughout the appeals.
- The Supreme Court reviewed both Alpha’s disqualification and whether the 10% threshold was a matter of standing (waivable) or subject matter jurisdiction (mandatory).
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Is the 10% threshold in HRS § 103D-709(d) jurisdictional or standing? | Standing requirement, not jurisdictional | Jurisdictional, bars Alpha's appeal | Jurisdictional – bars administrative/judicial review |
| Did Alpha meet the 10% minimum controversy requirement? | Entire contract value is in controversy | Only the value of disputed line item | Alpha did not meet 10% – $95K is <2% of $6M contract |
| Was Alpha properly disqualified for not listing a subcontractor or lacking the correct license? | C-17 license sufficed; sub <1% excused | C-27 license required, no waiver | Disqualification was proper, BWS acted within discretion |
| Does estoppel or waiver prevent BWS from disqualifying Alpha? | BWS’s letter misled Alpha, should be estopped | No reliance, no intentional waiver | No estoppel or waiver – no detrimental reliance |
Key Cases Cited
- Sierra Club v. Dep't of Transp., 115 Hawaiʻi 299 (statutory standing requirements derive from legislative intent, not solely common law)
- Furuya v. Ass’n of Apartment Owners of Pac. Monarch, Inc., 137 Hawaiʻi 371 (promissory estoppel requires detrimental reliance)
- Citizens for Prot. of N. Kohala Coastline v. Cnty. of Hawaiʻi, 91 Hawaiʻi 94 (standing focuses on the party seeking relief)
- Coon v. City & Cnty. of Honolulu, 98 Hawaiʻi 233 (waiver requires knowing relinquishment of a right)
- Barker v. Young, 153 Hawaiʻi 144 (statutory interpretation principles)
