The city contends that the cost of the contract chargeable to city funds is less than $1,000, and, hence, by its terms, the bid ordinance, sec. 7.29, is not mandatorily applicable.
If the contract in question is not subject to the provisions of the bid section, the city is not bound by that type of procedure and even, after determining to invite bids, may reject any or all bids and ask for new bids, or may contract on the basis of reasonable business judgment with one who is not the low bidder.
Cullen v. Rock County
(1943),
If, on the other hand, the towing contract can be let only pursuant to bid procedure, it is necessary to determine whether the commissioner has the discretion to award the contract to other than the low bidder — bearing in mind that Menzl was the higher of the two bidders.
Sec. 7.29, Milwaukee city charter, insofar as it is pertinent to this case provides:
“All work and the purchase of all materials, supplies, and equipment, chargeable to any city fund, when the cost thereof shall exceed the sum of $1,000.00, except street cleaning, shall be let by contract, to the lowest bidder in the manner provided by Sections 7.23, 7.24 and 7.26 of the Milwaukee City Charter, 1934 compilation
Appellant claims that in determining the amount of the contract the entire cost of the related governmental functions must be considered; in this case, all payroll and administrative expenses of the police department devoted to locating and investigating matters pertaining to abandoned, wrecked, disabled, stolen, or police-evidence vehicles, a sum clearly in excess of $1,000. We consider this argument devoid of merit. Only such costs that the city must pay for the performance of the contract should be considered and not the administrative cost of a function of the city. The bid statute is pertinent only to work not done by the city’s own employees.
Menzl also contends that, since the gross proceeds of the sale of abandoned cars concededly amounts to more than $1,000, the contract is within the purview of sec. 7.29. We conclude, however, that the city attorney correctly points out that the dollar limit referred to in the ordinance must be chargeable to “city funds.” The method of paying the tower is outlined in sec. 7.46 of the charter and is set forth in greater detail in the specifications that are of record. It appears that the towing contractor has first claim upon the proceeds after the payment of the cost of the sale. It is only
after
payment to the contractor that the balance is deposited with the city treasurer and paid to the general city fund. By the terms of the specifications and sec. 7.46, the contractor
Appellant points out, however, that the city concedes that approximately $700 a year will be chargeable to a city fund for the towing of police-evidence vehicles and that, since this is a three-year contract, the cost is estimated to be $2,100, well in excess of the $1,000 proviso of sec. 7.29. The respondent city contends that the contract cannot be considered a three-year contract because the commissioner of public works is restricted in his authority to contract for the doing of any work in any one year to the sum appropriated for such work. In this case it appears that $700 has been appropriated for 1966. The city relies on sec. 7.27 of the Milwaukee city charter, which provides:
“Contracts not to exceed appropriations. 7.27 The said commissioner of public works shall have no power, by contract or otherwise, to exceed in the doing of any work, in any one year, the sum appropriated for such work by the said common council, or by law, for such year.”
This section is not relevant to the purposes of sec. 7.29. Sec. 7.27 merely means that the commissioner of public works cannot in a single year subject the city to liability by contract that is in excess of the funds appropriated for a particular purpose in that year.
The basic ordinance that we must consider is sec. 7.29, which provides that contracts shall be let by bid “when the
cost
thereof shall exceed the sum of $1000.00.” (Emphasis supplied.) Respondent, in effect, contends that sec. 7.29 should be read, “when the
presently appropri
Respondent’s interpretion is contrary to the purpose of the bid statute and the generally accepted rule as stated in 10 McQuillin, Mun. Corp. (3d ed.), p. 280, sec. 29.33:
“And where a municipality is prohibited from letting contracts involving an expenditure of more than a specified sum without submitting the same to competitive bidding, it cannot divide the work and let it under several contracts, the amount for each falling below the amount required for competitive bidding.”
It seems to be the position of the respondent that, although there is a master agreement that binds the bidder for a three-year period, a contract as defined in sec. 7.29 comes into fruition only as money is appropriated annually. Such interpretation would render sec. 7.29 substantially ineffective. It could readily be evaded either by dividing the work into a series of small contracts or, as the city attempts to do here, withholding the council’s formal act of appropriation until after the contract is entered into on a noncompetitive basis.
There is no intimation in respondent’s argument that the city does not intend to pay the obligations under the contract as they accrue, and the evidence of record shows that the cost in the aggregate will exceed $1,000.
We conclude that the contract is one in which the cost chargeable to any city fund exceeds $1,000 and must be
Will mandamus lie in this ease?
It is clear that the trial judge arrived at the decision to deny mandamus through an error of law. In his memorandum opinion he stated:
“A mandamus will lie, of course, when there is clear and satisfactory evidence that the Commissioner refused or failed to do that which he is required to do by law. His duty to act should be plain and clear either as an abuse of discretion or to perform a given act which it is his legal duty to perform.
“For the reasons previously stated by the court, namely, that the particular contracts which, in the opinion of this court, have not been shown to fall within the competitive bid provisions of the charter, statute and ordinance, no specific legal duty has been demonstrated to the satisfaction of the court by the proof required, and the . . . mandamus must be denied.”
However, our decision that the towing contract must be let only by bid procedures does not
ipso' facto
determine that mandamus will lie. Mandamus is a discretionary writ. We said in
State ex rel. Sullivan v. Hauerwas
(1949),
“Mandamus is a summary, drastic, and extraordinary writ issued in the sound discretion of the court. Although classed as a legal remedy, mandamus is equitable in its nature and its issuance is generally controlled by equitable principles. The rights of the public and of third persons may be considered.”
“The [trial] court has discretion as to the issuing of a writ of mandamus directed to a public officer. The order of the court will not be reversed except for abuse of such discretion.” State ex rel. New Strand Theatre Co. v. Common Council (1930),201 Wis. 423 , 425,230 N. W. 60 .
The extent to which these principles apply to compel the awarding of 'contracts depends largely upon the statutory powers and duties of the contracting officer or agency. The general charter law, ch. 62, Stats., that authorizes the award of contracts to the lowest responsible bidder (sec. 62.15 (1)) and specifically granting authority to the city to reject all bids (sec. 62.15 (5)), grants a wide discretion to bid letters operating under this statute. It is difficult to conceive of a situation arising under that statute where mandamus would lie. The city of Milwaukee, however, operates under its own charter ordinance, and the Milwaukee charter does not contain those phrases in regard to “responsible” bidders or “the right to reject all bids” that grant such wide discretion to city officers operating under the general charter.
“Whether the duty of a public officer who is required to let a contract to the lowest bidder involves the exercise of discretion is a question upon which the authorities are not in harmony. Some courts hold the duty is ministerial and enforceable by mandamus, even after the contract has been awarded to another bidder who has proceeded to perform the work. However, the 'prevailing view seems to be that mandamus does not lie for such purpose, especially where discretion is to be exercised or discrimination is permitted by the officials in awarding the contract.” (Emphasis supplied.) 17 McQuillin, Mun. Corp. (8d ed.), pp. 561, 562, sec. 51.52.
In
State ex rel. Phelan v. Board of Education
(1869),
“. . . the lowest bidder, whose bid has been rejected, has no absolute right to a writ compelling the execution of a contract with him, after one has in fact been let to another. The writ of mandamus being a discretionary writ, the fact that the contract has actually been awarded to another is sufficient to induce the courts to decline to interfere to further complicate the matter, even though they might otherwise have done so.” (Emphasis supplied.)
In a more recent case,
State ex rel. Hron Brothers Co. v. Port Washington
(1953),
“Like mandamus, certiorari is a discretionary writ .The petition itself shows that the contract hasbeen awarded to another and we cannot consider it an abuse of discretion when the trial court refrained from further complicating the matter.”
In the instant case we do not have the complicating factor of an award to another bidder. Moreover, in
Hron, supra,
page 510, as in
Mueller v. Eau Claire County
(1900),
The extent of discretion vested in the commissioner of public works of the city of Milwaukee is spelled out in detail in sec. 7.23 of the Milwaukee city charter:
“. . . whenever the lowest bid for any work to be let by said commissioner, shall appear to said commissioner to be unreasonably high, the said commissioner is authorized to reject all bids therefor, and to re-let the work anew, and whenever any bidder shall be, in the judgment of said commissioner, incompetent, or otherwise unreliable for the performance of the work for which he bids, the said commissioner shall report to the common council of said city a schedule of all the bids for such work, with a recommendation to accept the bid of the lowest competent and reliable bidder for such work, with its reasons for such recommendation, and thereupon it shall be lawful for the said common council to direct said commissioner either to let the work to such lowest competent and reliable bidder, or to re-let the same anew. And provided, further, that the said commissioner may reject the bid of any person who shall previously have wilfully or negligently failed to complete any work or contract entered into by him with the city, or any officer or department thereof, or who shall have wilfully or negligently failed to enter into a contract with satisfactory sureties, for any work or improvement that shall have been previously awarded to him by said commissioner, and the failure to let such contract to the lowest bidder, in compliance with any provision of this section, shall not invalidate such contract, or any special assessment thereunder, or for the work done in virtue thereof.”
One additional grant of discretion relevant to this case is given to the commissioner by the ordinance. If he concludes that the lowest bidder is incompetent or unreliable, he may notify the council of that conclusion and recommend that the work be let to the lowest competent bidder. It is then up to the council to determine what course shall be followed, and the council may authorize the award to the lowest competent and reliable bidder or may order that the contract be let anew.
In
Neacy v. Milwaukee
(1920),
“We have been referred to no provision of the city charter conferring authority upon the commissioner to reject all bids under such circumstances. His power is to rejects bids only when the lowest bid is unreasonably high in his judgment.”
Similar language pointing out the severe limitations upon the commissioner’s (then the board’s) discretion, under a similar, if not identical, charter ordinance, was used in
Ricketson v. Milwaukee
(1900),
. “It was to avoid giving them any chance for the exercise of discretion . . . that the charter required definite plans and specifications, and a letting to the lowest competent and reliable bidder. The letting must be to the lowest bidder, under the charter, unless the board shall find his bid to be unreasonably high . . . .” (Et cetera, listing the same exceptions that appear in the present charter ordinance.)
However, we must conclude on the basis of this record that Menzl is not entitled to a writ of mandamus at this juncture. He is not the low bidder. Superior Auto Body is the low bidder. Superior’s bid price for towing was $7.90 and Menzl’s was $10. In other respects their bids were identical. For Menzl to prevail, Superior Auto Body must be eliminated as a competitor for the bid. It is apparent from the foregoing discussion that the commissioner, being bound by the provisions of secs. 7.23 and 7.29, did not effectively reject the bids. The case, on the basis of this record, is presently in the same posture as it was before the commissioner’s nugatory rejection. Superior is the low bidder but has not yet been able to qualify. We conclude, in the absence of applicable pre-qualification procedures of bidders, that a low bidder should have a reasonable time to qualify. It now behooves the commissioner to ascertain whether Superior now qualifies or can qualify within a reasonable time or whether
By the Court. — The' judgment of the circuit court, as modified, is affirmed, and the cause is remanded to the circuit court, the circuit court to retain jurisdiction pending the commissioner’s exercise of his discretion under the charter of the city of Milwaukee in a manner not inconsistent with this opinion. Costs are assessed against the respondent.
Notes
We note that at least one witness representing the commissioner in circuit court testified that neither of the bids was unreasonably high. However, we do not consider that this testimony should bind the commissioner in a formal determination in regard to the reasonableness of the bids.