701 N.E.2d 454 | Ohio Ct. App. | 1997
Plaintiff-appellant, North American Salt Company ("NAMSCO"), appeals from a judgment of the Franklin County Court of Common Pleas denying its request for injunctive relief against defendant-appellee, Ohio Department of Transportation ("ODOT").
This action arises out of ODOT's refusal to purchase road deicing salt from NAMSCO because the salt is mined in Canada rather than in the United States. The stipulated facts and exhibits indicate that, on August 23, 1996, ODOT issued Invitation to Bid No. 18-97 soliciting bids for road deicing salt for each of Ohio's eighty-eight counties for the 1996-1997 winter. NAMSCO, Morton International, Inc. ("Morton"), and Akzo-Nobel Salt Company ("Akzo") submitted bids in response to Invitation to Bid No. 18-97. With respect to counties located in the southern half of Ohio, the bids of NAMSCO, Morton, and Akzo all called for the salt to be supplied from the companies' respective mines in Louisiana. However, for counties located in the northern half of Ohio, including Wood County, Morton's and Akzo's bids called for the salt to be supplied from the companies' mines in Fairport and Cleveland, Ohio, respectively, while NAMSCO's bid called for the salt to be supplied from NAMSCO's mine in Goderich, Ontario, Canada.
On October 10, 1996, ODOT notified NAMSCO by letter that its bids for Wood County and for several southern Ohio counties had been accepted. NAMSCO's bid for Wood County was more than five percent lower than the lowest bid calling for salt mined in Ohio. By this same letter, ODOT also notified NAMSCO that it was rebidding fifteen northern Ohio counties. Thus, on October 10, 1996, ODOT issued Invitation to Bid No. 18-97A soliciting bids for road deicing salt for fifteen northern Ohio counties for the 1996-1997 winter. The second page of Invitation to Bid No. 18-97A contained the following language in boldface type:
"Buy America Act now recognizes Canadian end source product as a domestic end source product where the purchase is $25,000.00 and above."
NAMSCO, Morton, and Akzo submitted bids in response to Invitation to Bid No. 18-97A. In its bid, NAMSCO again proposed supplying salt for the fifteen *217 counties at issue from its Goderich, Ontario mine, while Morton and Akzo proposed supplying salt for these counties from their Ohio mines.
Following consultation with the Ohio Attorney General's Office, ODOT notified NAMSCO on November 1, 1996, that it was withdrawing its acceptance of NAMSCO's bid for Wood County because Ohio law required it to select a bidder using salt mined in Ohio where it has received two or more bids proposing the use of the Ohio-mined product.
On November 4, 1996, ODOT opened bids for Invitation to Bid 18-97A. Although NAMSCO's bids for Paulding, Van Wert, Wyandot, Fulton, Sandusky and Williams Counties were more than five percent lower than the lowest bids calling for salt mined in Ohio, ODOT rejected NAMSCO's bids.
On November 6, 1996, NAMSCO filed suit in the Franklin County Court of Common Pleas, requesting a temporary restraining order enjoining ODOT from awarding road salt contracts for Paulding, Van Wert, Wyandot, Fulton, Sandusky, Williams, and Wood Counties, and seeking injunctive relief compelling ODOT to honor its road salt contract with NAMSCO for Wood County, and compelling ODOT to award NAMSCO road salt contracts for Paulding, Van Wert, Wyandot, Fulton, Sandusky, and Williams Counties in accordance with the terms of Invitation to Bid 18-97A.
On November 8, 1996, NAMSCO filed an amended complaint adding Morton and Akzo as defendants. Following a brief oral hearing, the trial court denied NAMSCO's request for a temporary restraining order. By agreement of the parties, the case was then submitted to the court on briefs, stipulated facts, and exhibits. Following oral argument on December 23, 1996, the court took the matter under advisement. On January 16, 1997, the trial court issued a decision and entry denying NAMSCO's request for injunctive relief and dismissing its complaint. NAMSCO appeals therefrom assigning the following error:
"The trial court erred in denying plaintiff's request that mandatory injunctive relief, or alternatively, declaratory relief, be entered requiring that the Department of Transportation and its Director, Jerry Wray, honor one contract and award six others for the purchase of road salt for the 1996-1997 winter from plaintiff by the Department for seven northwestern Ohio counties."
Preliminarily, Akzo argues that, because the 1996-1997 winter has passed, it is no longer possible to grant NAMSCO the injunctive relief which it seeks and, therefore, NAMSCO's appeal should be dismissed as moot.
We agree that NAMSCO's claim for injunctive relief has been rendered moot by the passage of time; however, NAMSCO argues that its complaint should be read to contain a claim for declaratory judgment. Although NAMSCO has never expressly sought declaratory relief, the last paragraph of its complaint *218
does request "all additional relief to which [NAMSCO] is entitled at law or in equity." Construing this language to encompass a claim for declaratory judgment results in no unfair prejudice to defendants, as the underlying issues remain the same. Further, the issues of statutory construction raised by NAMSCO's complaint are directly within the scope of the Declaratory Judgment Act. R.C.
The pivotal issue in this case is whether Ohio law prohibits ODOT from purchasing road salt mined outside the United States. R.C. Chapter
"(B) Prior to awarding a contract * * * the state agency responsible for evaluating a contract for the purchase of goods shall evaluate the bids received according to the criteria and procedures established pursuant to divisions (C)(1) and (2) of section
The trial court found that R.C.
NAMSCO argues that, in so holding, the trial court failed to read R.C.
"(C) The director of administrative services shall, by rule adopted pursuant to Chapter
"* * *
"(6) Criteria and procedures for the director to grant waiversof the requirements of division (B) of section
"(7) Such other requirements or procedures reasonably necessary to implement the system of preferences established pursuant to division (B) of section
"In adopting the rules required under this division, thedirector shall, to the maximum extent possible, conform to therequirements of the federal `Buy America Act,'
In accordance with R.C.
"(A) Scope. This rule implements the Buy-Ohio Act (Amended House Bill 271, 115th General Assembly) and the policies set forth in the governor's executive order 83-1, January 10, 1983, with respect to supply and service contracts, other than construction contracts. To the extent possible, this rule conforms to the requirements of the Federal Buy America Act,
"(B) Policy. Except as further provided in paragraph (C) ofthis rule, bids will be evaluated so as to give preference todomestic Ohio bids. This preference shall be applied throughthe procedures outlined in paragraph (C) of this rule.
"(C) Procedure for applying domestic Ohio bid preference
"(1) Bids will first be evaluated to determine that a bidder'soffering is for a `domestic source end product,' as definedat 41 C.F.R. section 1-6.101 (D) 1 [sic, (d)]. Information furnished by the bidder as provided for in paragraph (D) of this rule shall be relied upon in making the determination. Anybidder's offering *220 that does not meet this requirement shall be rejected, except inthose circumstances where the director of the department ofadministrative services or his designee determines that certainarticles, materials and supplies are not mined, produced ormanufactured in the U.S. in sufficient and reasonably availablecommercial quantities and of a satisfactory quality.
"(2) Following the determination at paragraph (C)(1) of this rule, remaining bids and proposals shall be evaluated so as to give preference to Ohio bids or bidders who are located in a border state, provided that the border state imposes no greater restrictions than contained in sections
"(3) Where the preliminary analysis identifies the apparent lowbid as one other than an Ohio bid or bid from a border state, thedirector or his designee shall consider the following factors:
"(a) Whether the goods or services can be procured in-state in sufficient and reasonably available quantities and of a satisfactory quality;
"(b) Whether an Ohio bid has been submitted;
"(c) Whether the lowest Ohio bid, if any, offers a price to thestate deemed to be an excessive price;
"(d) Whether the lowest Ohio bid, if any, offers a disproportionately inferior product or service.
"For purposes of applying these criteria,'excessive price'shall be construed to mean a price that exceeds by more than fiveper cent the lowest price submitted on a non-Ohio bid.
"(4) Where the director or his designee determines that selection of the lowest Ohio bid, if any, will not result in an excessive price or a disproportionately inferior product or service, the director or his designee shall propose a contract award to the low Ohio bid at the bid price quoted. The final contract award shall be made following further evaluation and award under rule
NAMSCO concedes that its bids for Wood, Paulding, Van Wert, Wyandot, Fulton, Sandusky, and Williams Counties were "non-Ohio bids," as the salt was mined in Canada; however, according to NAMSCO, because its bids for those counties were more than five percent lower than the lowest Ohio bid, ODOT was required to award it the salt contracts for those counties under Ohio Adm. Code
NAMSCO contends that R.C.
NAMSCO's reading of Ohio Adm. Code
Therefore, pursuant to R.C.
However, pursuant to R.C.
In the present case, the Canadian-mined salt which NAMSCO offered to supply in its bids for Wood, Paulding, Van Wert, Wyandot, Fulton, Sandusky, and Williams Counties was not a "domestic source end product," as that term is defined in former Section 1-6.101(d), Title 41, C.F.R. Nor is there any evidence in the record that the Director of Administrative Services or his designee has determined that rock salt is "not mined, produced or manufactured in the U.S. in sufficient and reasonably available commercial quantities and of a satisfactory quality." Therefore, ODOT was required to reject NAMSCO's bids for Wood, Paulding, Van Wert, Wyandot, Fulton, Sandusky, and Williams Counties despite the greater-than-five-percent price advantage offered by NAMSCO.
NAMSCO argues, however, that, because Section 1-6.101 (d), Title 41, C.F.R. has been superseded,3 the definition of "domestic source end product" contained in the replacement regulation rather than the definition in former Section 1-6.101 (d), Title 41, C.F.R. should be applied to its bids for Wood, Paulding, Van Wert, Wyandot, Fulton, Sandusky, and Williams Counties. According to NAMSCO, Section 25.402 (a)(3)(ii), Title 48, C.F.R. is the regulation which replaced Section 16.101 (d), Title 41, C.F.R. Section 25.402 (a)(3)(ii), Title 48, C.F.R. provides as follows:
"(3) As required by the North American Free Trade Agreement (NAFTA) Implementation Act (Pub. L/103-182, 107 Stat.2057), agencies shall evaluate offers of the following NAFTA country end products without regard to the restrictions of the Buy America Act * * *:
"* * *
"(ii) Canadian end products under supply contracts with an estimated value above $25,000 * * *." *223
Relying upon R.C.
Assuming, for the moment, that the replacement of Section 1-6.101 (d), Title 41, C.F.R. makes it appropriate to look to the replacement regulation for the definition of "Ohio domestic source end product," despite Ohio Adm. Code
Further, Section 25.402 (a)(3)(ii), Title 48, C.F.R. is inapplicable to purchases by ODOT, as NAFTA does not apply to state government procurements at the current time. See Bohne, NAFTA: What you Need To Know Now (1994) 49. Specifically, NAFTA currently provides in relevant part as follows:
"1 Article 1001: Scope and Coverage
"1. This Chapter applies to measures adopted or maintained bya Party relating to procurement:
"(a) by a federal government entity set out in Annex 1001.1a-1, a government enterprise set out in Annex 1001.1a-2, or a state orprovincial government entity set out in Annex 1001.1a.-3 in accordance with Article 1024:
"(b) of goods in accordance with Annex 1001.1b-1 * * *." (Emphasis added.)
Currently, Annex 1001.1a-3 provides as follows:
"Coverage under this Annex will be the subject of consultations with state and provincial governments in accordance with Article 1024 (Further Negotiations)." *224
Because Ohio is not currently listed under Annex 1001.1a-3, NAFTA and the federal regulations which implement the treaty, such as Section 25.402 (a)(3)(ii), Title 48, C.F.R., do not presently apply to purchases of goods and supplies by the state of Ohio or its governmental agencies.
In fact, Section 25.101, Title 48, C.F.R. is the "Buy America Act" implementation regulation which replaced Section 16.101 (d), Title 41, C.F.R. See "Editorial Note" preceding Chapter 1-49, Title 41, C.F.R.; Section 25.100, Title 48, C.F.R. Although Section 25.101, Title 48, C.F.R., replaces the term "domestic source end product" defined in Section 1-6.101 (d), Title 41, C.F.R., with the term "domestic end product," the definition of this new term is, in relevant part, virtually identical to the definition of "domestic source end product" found in former Section 1-6.101 (d), Title 41, C.F.R.5 Consequently, ODOT was required to reject NAMSCO's bids for Wood, Paulding, Van Wert, Wyandot, Fulton, Sandusky and Williams Counties pursuant to Ohio Adm. Code
Finally, NAMSCO argues that, if R.C.
It is well settled that the United States Constitution vests the power to formulate and administer foreign affairs exclusively in the federal government. United States v. Pink
(1942),
In striking the Oregon statute down, the Zschernig court observed that the enforcement of such provisions frequently turned on "minute inquiries concerning the actual administration of foreign law" and on foreign policy attitudes connected to the "freezing or thawing of the `cold war.'" Id.
Relying upon Zschernig, the Third Circuit, in Trojan,
recently upheld a Pennsylvania statute prohibiting the use of foreign-made steel in state public works projects against a challenge that it unconstitutionally infringed on the federal government's foreign affairs power. The court held that the Pennsylvania statute, unlike the Oregon statute struck down inZschernig, did not involve the state in the conduct of foreign affairs, as it applied to "steel from any foreign source, without respect to whether the source country might be considered friend or foe." Trojan,
In the instant case, R.C.
Still, NAMSCO relies upon Bethlehem. Steel Corp. v. Bd. ofCommrs. of the Dept. of Water Power of Los Angeles (1969),
Based upon the foregoing discussion, NAMSCO's sole assignment of error is overruled, and the judgment of the Franklin County Court of Common Pleas is affirmed.
Judgment affirmed.
TYACK, P.J., and PETREE, J., concur.
