Hamp's Construction, L.L.C. v. Housing Authority of New Orleans
52 So. 3d 970
La. Ct. App.2010Background
- HANO issued invitation for bids 12/16/2009 for ARRA-funded scattered sites remediation and demolition; bid opening 2/4/2010 showed Hamp as lowest bidder with Young General Contractors second lowest.
- On 3/9/2010, HANO rejected Hamp as non-responsible due to alleged improper business practices and non-compliance with public policy, citing ARRA funding and policy to not hold an informal hearing.
- Hamp filed 3/15/2010 for writ of mandamus and preliminary injunction alleging arbitrary/capricious action and violation of Louisiana Public Bid Law (La. R.S. 38:2211 et seq.) by denying a hearing as to non-responsibility.
- Trial court granted mandamus and injunction, ordering HANO to award the contract to Hamp as lowest responsive and responsible bidder; on appeal, HANO challenged trial court’s legal conclusions.
- Appellate standard of review is de novo for legal errors; mandamus is an extraordinary remedy and not to be used where discretion remains; court reviews whether due process and public bid procedures were violated.
- The core issue is whether HANO’s failure to provide Hamp a hearing prior to disqualifying it as non-responsible was arbitrary and violative of public bid law.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether Hamp was entitled to a hearing before disqualification. | Hamp asserts due process requires a hearing regardless of ARRA. | HANO contends ARRA exempts compliance with state bidding procedures. | Yes; hearing required under Louisiana Public Bid Law. |
| Whether state public bid law applies to ARRA-funded contract disqualification. | State due-process protections apply to bid disqualification. | ARRA/Federal law preempts state bidding requirements. | State law governs; federal requirements do not preempt due process protections. |
| Whether HANO acted within authority and without arbitrary discretion. | Disqualification without opportunity to refute is arbitrary and capricious. | Agency discretion allowed, no required hearing. | Arbitrary and capricious conduct; mandamus affirmed. |
| Whether trial court correctly applied public bid law standards to Hamp’s challenge. | Lower bidder must be given chance to contest irresponsibility findings. | Administrative discretion to disqualify was permissible under policy. | Trial court correct; disqualification without fair opportunity violated law. |
Key Cases Cited
- Haughton Elevator Division v. State, Through Division of Administration, 367 So.2d 1161 (La. 1979) (due process safeguards in bid disqualification; fair opportunity to refute charges must be provided)
- Broadmoor, L.L.C. v. Ernest N. Mortal New Orleans Exhibition Hall Authority, 867 So.2d 651 (La. 2004) (public bid law is prohibitory; discretion must be fair and legal)
- Housing Authority of Opelousas v. Pittman Construction Co., 264 F.2d 695 (5th Cir. 1959) (administrative discretion must be exercised fairly; arbitrary rejection violates law)
- Saunders v. Stafford, 923 So.2d 751 (La.App. 4 Cir. 2006) (standard for preliminary injunction review; manifest error considerations)
- Allen v. St. Tammany Parish Police Jury, 690 So.2d 150 (La.App. 1 Cir. 1997) (mandamus limitations; discretion and evidence evaluation)
- Fire Protection Dist. Six v. City of Baton Rouge Dept. of Public Works, 868 So.2d 770 (La.App. 1 Cir. 2003) (mandamus generally improper when act involves discretion, but can correct arbitrary abuse)
- State ex rel. Torrance v. City of Shreveport, 93 So.2d 187 (La. 1957) (mandamus to correct arbitrary performance of administrative act)