*1 аppeal, on time the first raised for question cannot be court. accordingly overruled. is point ptitioner’s second and Loumparoff Procedure; v. Rules of Texas Rules See App., Dallas, S.W. Texas Civ. Authority City Housing writ). (no 2d 224 reversed judgment of the Court of Civil is affirmed. trial court May 1960.
Opinion delivered Incorporated Son, T.
James Independent Arlington District. 1960. Decided April A-7147. No. Rehearing June 1960. Overruled 371) (335 2d Series *2 Godfrey, Logun McGown, Decker, & Warren Shipman, W. McMackin, Worth, petitioner. all of Fort III, John W. for Appeals holding erred ordinary Court The petitioner preclude part granting would on recission; by way of relief order to equitable of' bar guilty petitioner must have been relief bad faith or negligence; petitioner respondent had to gross show that prior have known honest error should to the knew or contract, and that relief is not available award prerequisites though essential to such the four relief are even present. Co., Trinity Ry. B. V. & 118 Edwards v. writ S.W. Kemper City refused; F. Const. v. M. Co. of Los An error of geles, 7; Highway 2d 235 Pac. 2d Com. v. Calif. 37 refused, n.r.e.; Baltimore Canion, 250 Atl. 2d 557. Davis, Md. Luca De M. Young and Ardell Brown, Herman, Samuels, Scott & Young, respondent. for opinion of the Court.- delivered the
MR. Justice Hamilton remanded a has reversed of Civil Court (hereinafter granted re- summary judgment petitioner to the summary judgment Taylor) by That the trial court. ferred to as right requested relief of its District’s denied the School $36,278.00. 2d 548. 322 S.W. High District hаd decided to Junior School build building competitive from vari- and had called bids
ous contractors for the construction. submitted together bond, performance required, and his with *3 $534,175 of nine of was the lowest bids submitted. School District, opened, ac- within a few minutes after the bids were bond, by cepted Taylor. the His furnished Seaboard- Surety Company, provided null and if that it would be void building subsequently executed the by to the was contract build obligors him; pay the the difference be- otherwise would finally accepted. Taylor In addition tween the bid and the bid estimates an was to to the total amount of the amount 6% margin. by Taylor anticipated profit this be added When carry a $100,000 an due to a failure to done digit. error of occurred morning until the after the The error was not discovered bid, accepted Taylor the when notice of such District had School given Taylor promptly District. contract, re- mistake was to the School when the tendered construction and fused to execute the Board awarded the contract was returned unexecuted the bidder, Company. Bock contract next lowest Construction expense was involved for the or additional No readvertisement by the District was instituted School District. Suit School the difference between the the amount of on the bond recоver $36,278.00. Taylor an amount of and Bock bid granted remanding reversing summary judgment and - Appeals petitioner by the Court Civil the trial court to Taylor prove by must clear con- trial that on new held vincing by petitioner mistake made that the unilateral evidence negligence, Taylor’s and that the District due to was not Taylor that had made mistake to know had reason or knew holding acceptance of bid. the Court prior to its provеs unless he is liable these Appeals is points. Taylor’s points of error equitable assert relief is not barred ordinary negligence, gross only by faith, or bad and that it was necessary that the School Dis- trict know or have reason to prior know of accept- the error ance of the bid granted. before rescission can be 1,2 question On the by way rescission, relief we have concluded agree that we cannot with the Court of Civil holding petitioner before is entitled to relief he must show convincing clear and evidence that the unilat eral mistake was not due to own his and that School District either knew or should have known of the mis take accepting before great weight bid. think We of au thority against the law as announced the Court of Civil Appeals. legal ofMost the cases and propo writers affirm the sition that granted against relief will be a unilаteral mistake when the conditions of present. remediable mistake are These generally conditions (1) great are: the mistake is of so consequence that to enforce the contract as made would be un conscionable; (2) the mistake relates to a material feature of contract; (3) regardless the mistake must have been made ordinary care; exercise of (4) parties can be placed quo equity sense, i.e., status in the rescission must prejudice not result except to the other for the loss bargain. may of his There be other circumstances which will govern or influence relief, the extension of such as the acts and knowledge extent of parties. Steinmeyer Schroeppel, 226 Ill. 114, (1907) ; 80 N.E. Kemp L.R.A. N.S. M. F. *4 City Angeles, 696, er Const. v.Co. of Los 37 Cal. 2d 235 P. 2d (1951) ; City Baltimore, 7 Co., etc. v. De Luca-Davis Const. Inc., (1956) ; Story’s 210 Md. Equity 124 Atl. 2d 557 Juris 1381; prudence, 59 A.L.R. Sec. Anno.: Unilateral Mistаke Equity Contract; as Basis of Bill in 2d, to Rescind the 52 A.L.R. p. Rights Anno.: and Remedies of Bidder for Public Contract, Has Not Entered Into a Contract Who Where Bid Based on His Own Mistake Fact or That of Was His Em ployees. p. 796, summarizing 52 A.L.R. in the conditions under grant equity consequences will relief from the
which of a bid public has a contract which been submitted as the for result remediable, mistake, acceptance unilateral before of a of the case bid, is stated in effect that no has been it discovered in granted by way relief has not been of rescission which proof where appropriate relief there similar of a or combina- establishing remediable mistake of circumstances and time- tion right ly knowledge of the communication and assertion Highway against Com- relief party. the case of other n.r.e., is Canion, one refused mission v. proposition. supporting cited cases this not in case is District Canion the contends point gave the notice of acceptance by because in case the contractor attempted mistake and the his to withdraw bid before Highway Commission, the School the case us and in before accepted and prior District had of the mistake the bid to notice interpret request the for do withdrawal of the bid. We attributing any opinion particulаr court’s in im- said case as portance given prior to to the that notice of mistake was fact recognize already acceptance. The court did that a ex- contract Commission, Highway even isted between though contractor and granting a a unilateral It did this contract. principally its rescission. The court that case decision based unjust, in- on equitable fact to enforce the contract would be oppressive upon for an honest mis- and the contractor Highway injure It is true take did not which Commission. Highway accepted when Commission had not Canion’s bid days opened, notified him of his error after his bid was three but, case, one, in that as in this no formal had been contract Jurisprudence, It is Public entered into. said 43 American Contracts, 63, p. and 805: Works Sec. granted general rule,
“As a bidder relief will be public a material mistake of for a where he has made contract discovery submitted, upon he fact in the bid informing public promptly authorities acts that mistake opportunity rectify requesting his or withdrawal of any mistake, formal particularly he does so before where is entered into.” contract acceptance that even after to us well settled It seems to be contemplated the contract the execution of beforе makes a public contract who parties, a bidder by giving may, notice thereof before in his bid remedial mistake offeree, change ob position to the detriment material against its enforcement. relief of the bid or
tain rescission Bromagin 407; (1942), 95 Ct. Cl. & Shepard United States *5 114, Bloomington 700; (1908), 234 Ill. 84 N.E. City of v.Co. City Indianapolis of v. Ben of Commissioners of Board School Regents 154; 164, Board App. N. E. of (1904) 72 36 Ind. der Ky. (1925), 761, v. Cole 209 Murray Normal 442, Mich. (1923) 222 192 508; Ford N.W. v. Kutsche 273 S.W. 622
714; School
(1950)
Dist. of Scottsbluff V. Olson Construction Co.
451,
164;
(1913),
45
v.
N.Y.
153 Neb.
Ch.,
N.W.
Barlow
Jones
649;
Harper
City Newburgh (1913),
App.
87 Atl.
159
v.
695,
59;
(1912),
Div.
145 N.Y.S.
Donaldson v. Abraham
68
208,
with gence we are confronted is the effect of claming part on the of one relief for his own very mistake. course the may Of word “mistake” itself can- degree negligence, speak note some and when the cases of an negligence, honest mistake and one madе without it is difficult just to determine what kind of is meant. In a footnote page 2d, on 52 A.L.R. it is stated: ‘negligence,’
“The term equivalent, or its in this connection generally ordinary negligence, means necessarily which will not granting equitable bar qualified, relief. Otherwise generally it good means carelessness or lack of faith in calculation which positive duty making a bid, violates' up as so to amount to gross negligence, negligence, or wilful when it takes on a sinis- meaning cause, ter established, and will furnish holding if offending mistake of the bidder to be one not remediable in equity. distinguished It is thus from a clerical or inadvertent handling bid, through items of a setting either them transcription.” down or Morgan, In the case Dixon v. 154 Tenn. 285 S.W. points the court culpable negligence out that pre- will relief, culpable clude and for to be it must be due to perform duty, failure duty some that it is not a failure of self, another, culрable negligence, to one’s that constitutes computation that a mistake of the cost of construc- work in tion order to make bid therefor does not indicate culpable negligence preclude equitable such as will aid to re- give the contract scind where to sustain it would the other advantage. an unconscionable Regents Cole, Ky.
In the case of Board of $22,000 the contractor mistake omitted a item in submitting and was there held that was entitled he rescinded, saying the court the' contract there was have had made an honest doubt the contractor mistake and it did no guilty culpable negligence. appear that he was It might any make. an érror businessman such
623 649, held the (N.J. it was Ch.) 87 Atl. Barlow v. Jones public can- work contractor entitled to have bid was inadvertently making omitted up had celled where in his bid he appeared in health and $28,000. that he was ill an item of It time, under the pressure at the and subjected to considerable might mistake was one which court said the circumstances the man, certainly could not one which a careful be made gross negligence. be characterized had occa- appellate courts of this state have
Several of the Levy, Texas question. v. 29 sion to comment on this Brown Trinity 389, 255, history; App., Edwards v. no writ Civ. 69 S.W. re- Ry. Co., App. writ B. 54 Texаs Civ. S.W. & V. Osborne, refused fused; 2d 154 S.W. Warren history; Bros., w.o.m.; writ no v. Scholz Marty, case 2d 319. The v. negligence 26 S.W. Scholz Clem Lumber Co. However, prevent any rescission. that will indicates appears of remediable mistake it that the elements in case opinion appears present. it probably From the court’s were not may in the contractor’s not have resulted that the mistake Furthermore, appears that making profit on his contraсt. signed accepted, contractor, had after his had been notifying mistake. the owner principal contract before granted party where one reformation In the case Osborne court, allowing knowledge in the other’s mistake. had reformation, negli- seeking though ben found it had mistake, gent said: in negligence element of some term ‘mistake’ involves
“The the circumstances.” may under may not be excusable or that rеscission could held be case the court In the Edwards negli- guilty of though complainant had been granted even mistake, Pomeroy quoting making from gence a unilateral as follows: “* * * said requisite, it has sometimes been As a second resulting complain- from the general that a mistake
very terms proposi- negligence relieved. This will never be ing party’s own It would be more ac- by the authorities. not sustained tion is wholly is caused the mistake say where curate to diligence the transaction which should that care want prudence, and the absence reasonable every person of used be legal duty, equity a court of violation be which would [a] guarded relief; this more even interpose its [with] not will negligence depend must statement, instance each mode great upon every to a extent its' own It circumstances. stay that will the hand of the court. The conclusion from the best authorities seems to must be positive legal highest duty. amount violation of *7 possible clearly negli- care is not demanded. Even a established gence may ground refusing relief, not of itself for be a sufficient appears prejudiced if it by. that the other has not there- been * * * (3rd Ed.) Eq. 2 Pom. Juris. Sec. 856.” Marty Co. v. Clem Lumber case held that the lumber company equitable mistake, was not entitled to relief from its owner, acсepting company’s in that case the after but the lumber material, purchased bid on a lot and a entered into contract building carpenter actually a a with to build on said lot and used part supplies by company furnished the lumber before given. any mistake notice of was of a elements remediable present. finally, mistake And the case of Brown were. Levy by deposit put was suit a contractor to recovеr a a $500.00 up $10,000.00 The claimed mistake was a with his bid. submitting $64,000.00 in a The next in addition bid. lowest bid alleged generally $76,000.00. required He the elements to mistake, it doubtful that the show remediable but loss of the deposit was a material detriment under the circum- $500.00 general sustained a stances. The trial court demurrer to the petition and the Court contractor’s affirmed. authorities, think both from this state We and from jurisdictions, clearly indicate that other cases of this kind negligence ordinary necessarily granting will not bar the Generally equitable it is when relief. amounts good such carelessness or lack of faith in to calculation which making duty up bid, taking positive violates a into consid- position and the the nature of transaction eration opposite contracting party, that relief will be denied. accept that if we as true the think facts as We testified to estimator, relating Hicks, Taylor’s how error was made in which it and under the circumstances was made do not indi- Taylor as would bar from cate such relief. time, says severely as that he was limited to and that He it was many necessary compile subcontractors, the bids of to being up almost to the deadline received when the bid was were get completed rushed the estimate He was to submitted. to be sheets, consisting eight The work submission. in time deposition. part his an From pages, made a examination were completed prepared appears estimate as it them Hicks $598,326.86. showed the cost to the contractor to He be Taylor’s office, took the estimate to Mr. who looked at it and page wrote down on the last of the estimate add.” This “6% profit. was to correctly computed be the contractor’s Hicks $35,899.61. figure, when he added it to the estimate 6% adding right digit from carry to left he failed to the last figure, $534,226.47 and came out with $634,226.47. instead of figure $534,175, then wrote down the and told Hicks to figure submit as the Hicks bid. filled that in on a form and personally Arlington, it took where the bids were to be sub- mitted, leaving his work sheets in his office. After the bids were opened the Board called Hicks in and advised him that he was thirty-five thirty-six the lowest bidder some or thousand dollars, and asked him if he was sure his bid was correct. He expressed said that opinion was. He probably they reason provided were low was next because the lowest bid days complete contract, for Taylor’s little over four hundred *8 provided days. for over five hundred The School accepted immediately Board president the bid thereafter. The of the Board was notified by of the contractor’s mistake morning. nine the next o’clock facts, true, necessarily these if
While would not equitable bаr the present, relief where elements of remediable mistake are judgment summary still we think that the trial court’s should granted, not have been for the reason that the record shows testifying that the Hicks, witness with reference to the error was general an who was interested witness. The rule is that testimony the of an interested witness does no more than raise by jury. a fact issue to determined the be While there are ex- rule, ceptions testimony to the seems settled that when comes an and is such a from interested of nature that it cannot untrue, relating readily an contradicted if issue be bility to the credi- Further, presented. petitioner the of the witness appear request the Board in his for did not before withdrawal bid, deposition he file an affidavit or submit nor did of his support in summary judgment, his motion nor
of excuse his Consequently, it cannot be said as a do so. matter failure to оf error, the not know of and on did the issue law that he made, should, in fact we think a was the court mistake whether circumstances, had testimony have the benefit of his the under granting him the relief which he seeks. We before therefore an there was issue fact to be deter- conclude a in jury as whether mistake was fact made. the mined applicable the elements of the test each to a course Of remediable, unilatеral mistake is a fact issue to be submitted jury a unless it can be resolved under the undis- the court puted said, question evidence. As we have heretofore the negligence gives every difficulty. us the most have said that We necessarily will not bar relief in a case of follows, guided by this therefore, court, kind. It the trial principles stated, the herein facts should determine from the circumstances under the mistake made whether there which is raised such issue of that should submitted to be jury. If there is raised an issue of fact as to whether good mistake was the result such carelessness or lack of faith legal making positive duty in calculation which violate the inquire then court should whether such mistake was wholly by the that minimum caused failure to exercise at least degree authority position public of care may reasonably expect all ex- School District of its bidders to light еrcise of the circumstances of transaction practice Pomeroy’s Jurisprudence, Equity of the trade. 3 Ed., p. 5th 340.
Although than we remand the case for different reasons opinion, Appeals in those set out judgment the Court of its its Civil remanding trial the cause for new is affirmed. April 27, Opinion delivered 1960. concurring. Griffin,
Mr. Justice agree judgment I in the affirmance Court grounds Appeals, not on stated. *9 my opinion, Appeals the the correct Court Civil stated “* * * said, general though rule is that rule of law when it acceptance has a contract been formed the of an offer —in legal objective appearance the control of the of the mis- view of acts, may the contractor taken contractor’s avoid —nevertheless obligations prove by the contract if he can clear and con- the vincing non-negligent that the mistake was evidеnce and that * * * suspected that a mistake had been the Board made .” adding In this case had contractor used one of the the. ma- figures total his chines in his office to and had he checked his adding slip, an work on machine error would been dis- the have covered. right expect have to that
Public bodies those who submit duty public bids have correct submitted bids. It the of the body to let the financially bids to the lowest bidder who is re- sponsible. hand, In the case at the School Board called the at- petitioner’s representative tention of peti- the to the fact that $35,000 tioner $40,000 was some repre7 low and asked the they they if job sentative were sure could do the on the bid ren- only receiving dered. It was after petition7 such assurance that accepted petitioner. er’s offer was think and the let bid was I equities the are on the side of the School District and that the given by reasons the correctly Court declare applied the law when facts of case. this See also the case Highway Canion, Commission App., Texas Civ. ref., er. n.r.e. Opinion April 27, delivered 1960. Greenhill, Mr. joined by Justice Justices Walker
Norvell, concurring.
I concur with the result reached majority.
It seems to peculiar me that under the case, facts of this there are (1) two issues of fact: was a made; mistake in fact (2) mistake, any, was the if a remediable onе. majority holds the first issue is says, raised. It also “Generally it is when amounts to such careless- good ness or lack of faith in calculation positive which violates a duty making bid, taking into consideration the nature of position the transaction and the opposite party, equitable relief be denied.” In accordance with principle, inquire the second issue should whether such mistake was caused failure to exercise аt least that minimum desree of care public authority, position district, in the may reasonably expect exercise, all of its bidders to light in the of the practices transaction and circumstances Pomeroy’s Equity Jurisprudence (5th trade. 3 ed.) 340. opinion majority, As I says construe the second might upon raised issue the trial. be Under the record as it us, raised; I think issue was reaches and if like evidence trial, another the issue adduced on should be be submitted. *10 April Opinion delivered 1960.
Rehearing 1960. overruled June