225 N.W. 149 | Minn. | 1929
The defendant advertised for bids for the construction of the West End Junior High School in St. Paul. An ordinance of the city provides:
"In case any bidder to whom a contract is awarded shall neglect to execute a contract with the City within ten days after he has been notified by the Corporation Counsel that the contract is ready *330 for execution by him, he shall forfeit to the City of St. Paul his bidder's bond or certified check, as the case may be, as fixed and liquidated damages for such failure." Comp. Ord. St. Paul, 1922, § 276.
The plaintiff submitted its bid for $146,000 on December 30, 1924, and deposited its check of $4,500. On January 27, 1925, the bids were opened, and on January 28 the bid of the plaintiff was accepted, it being the lowest. On February 2, 1925, the plaintiff was advised that the contract was ready for execution, and that if it failed to execute it the $4,500 would be forfeited as liquidated damages.
The plaintiff was unable to get a bond. The reason given by the bonding company was that its bid was too low. On February 26, 1925, a hearing was had by the common council relative to the forfeiture of the plaintiff's deposit. At that time Ford, who was in control of the plaintiff corporation, advised the city that the bonding company would not become surety for it and that it could not furnish a bond. He was asked whether there was any error in the bid, and he said there was not. He or the engineer for the company had rechecked the bid in the meantime and found no error. The council forfeited the deposit. The contract was let to another bidder, and the building was constructed.
The claim for relief upon the ground of mistake was first made in January, 1928. Ford was necessarily absent from the city from April 29, 1925, until November 10, 1927. Upon his return he investigated and found that in computing the amount of the bid the company had omitted a sheet containing items aggregating $17,941.70 which would have made its bid, if it had been included, the sum of $163,941.70, which was substantially the bid of the contractor to whom the contract was let.
The bid of the plaintiff and its acceptance by the city constituted a preliminary contract which contemplated the making of a formal contract. Tunny v. City of Hastings,
Judgment affirmed. *332