JPL Livery Services, Inc. d/b/a Ocean State Transfer v. Rhode Island Department of Administration JPL Livery Services v. State of Rhode Island
88 A.3d 1134
| R.I. | 2014Background
- JPL Livery provided 24/7/365 livery services for the OME under a five-year contract (July 1, 2005–June 30, 2010) with price terms of $125 (Providence) and $130 (elsewhere).
- The contract was formed by a notice of price agreement award and a bid solicitation, which were incorporated by reference; the notice stated continuation beyond the initial year depended on funds and stated grounds for termination.
- From March 2006, the DOH began limiting JPL’s transports and using its own personnel to perform some duties to reduce costs, after a March 2006 meeting with OME leadership.
- DOH/OME issued multiple letters in 2007 citing issues with JPL's performance and documentation, culminating in a December 10, 2007 termination of the contract for alleged violations.
- JPL filed suit in 2006 alleging breach; the cases were consolidated in 2010 and tried non-jury in 2012; the trial court ruled for the state, holding the contract was not exclusive and termination was proper, award of judgment to the state followed in 2013, and the Supreme Court affirmed.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Did contract language create exclusivity for JPL? | JPL contends the contract was exclusive and the DOH could not use its own personnel. | State argues language 'as requested' shows no exclusivity and permits non-JPL transport. | Not exclusive; exclusivity not required by plain language. |
| Was termination at the state's discretion illusory or valid? | Termination at any time would render the contract illusory. | Termination after the initial year was allowed for unsatisfactory performance and other factors. | Termination right not illusory; mutual obligation with good-faith requirement applies. |
| Was the termination in good faith and supported by evidence? | State acted in bad faith or as a vendetta based on past issues. | State provided legitimate grounds (performance issues, documentation failures); no clear bad faith shown. | Termination conducted in good faith with substantial evidence of dissatisfaction. |
Key Cases Cited
- Centerville Builders, Inc. v. Wynne, 683 A.2d 1340 (R.I. 1996) (mutuality of obligation; illusory termination rejected when adequate consideration exists)
- Holliston Mills, Inc. v. Citizens Trust Co., 604 A.2d 331 (R.I. 1992) (termination clauses are not illusory if not at-will without more)
- Furtado v. Goncalves, 63 A.3d 533 (R.I. 2013) (contract ambiguity review; plain meaning governs when unambiguous)
- Notarantonio v. Notarantonio, 941 A.2d 138 (R.I. 2008) (credibility given to trial court findings in bench trials; deferential standard)
- Cullen v. Tarini, 15 A.3d 968 (R.I. 2011) (credibility and weight given to witnesses on appeal; deference to trial court factual findings)