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Willett Motor Coach Co. v. Bd. of Education

OPINION FILED DECEMBER 29, 1981.

WILLETT MOTOR COACH CO., PLAINTIFF-APPELLANT,

v.

BOARD OF EDUCATION OF THE CITY OF CHICAGO ET AL., DEFENDANTS-APPELLEES.



APPEAL from the Circuit Court of Cook County; the Hon. ALBERT GREEN, Judge, presiding.

PRESIDING JUSTICE HARTMAN DELIVERED THE OPINION OF THE COURT:

Rehearing denied February 23, 1982.

Plaintiff Willett Motor Coach Co. (Willett), as a taxpayer, brought an action for injunctive and declaratory relief against the Board of Education of the City of Chicago (Board) and certain bus companies (defendants), which sought: (1) revocation of three-year contracts awarded for transportation of handicapped children attending Chicago public schools, ending August 31, 1983; (2) a requirement that the Board rebid those contracts; and (3) a declaratory judgment holding illegal the bidding procedure on which the subject contracts were predicated, and that all bids received pursuant thereto are null and void. Willett claimed that the Board failed to mail and that it did not receive a "Notice to Bidders" containing an amendment to the Board's original solicitation for bids. After a bench trial, judgment was entered for the Board and defendants. Willett appeals.

The issue raised for our consideration is whether the trial court's finding that the Board mailed the amendment to Willett was against the manifest weight of the evidence. A corollary issue is whether Willett proved a resultant true loss to general taxpayers as a result of the judgment.

From the evidence it appears that for the past 54 years Willett has provided busing services for the Board, transporting handicapped pupils attending Chicago public schools. On March 12, 1980, the Board solicited bids for contracts to provide 403 vehicles for such transportation. Willett received the solicitation by mail on March 13, 1980. The solicitation required submission of bids no later than 2 p.m. on April 15, 1980, and provided, "this agreement will be subject to cancellation by the Board of Education of the City of Chicago in sixty (60) days' written notice." The solicitation was subsequently amended by two separate notices to bidders, the second of which, not a subject of controversy in this action, was received by Willett. The first amendment ("amendment"), dated March 21, 1980, which Willett claims it did not receive, changed the Board's unilateral cancellation provision contained in the original solicitation to allow that either the Board or any contractor could cancel all obligations on 60 calendar days' notice.

In its second amended complaint Willett alleged that: no notice of said amendment was mailed or communicated to Willett; without the amendment, a successful bidder would be required to perform its obligations for three years; on April 15, 1980, Willett submitted its proposal to the Board without having any knowledge or notice of its amendment; Willett's estimates of possible labor increases and the cost of performance bonds would have been lower had it known of the amendment; consequently, its lack of knowledge placed Willett at an economic disadvantage; and, had Willett received or been aware of the amendment, it would have submitted a proposal to the Board in an amount less than the total amounts bid by the successful bidders.

At trial, Willett presented five witnesses and obtained a stipulation with respect to a sixth witness relative to the asserted lack of receipt of the bilateral cancellation amendment. William J. Merges, assistant director of purchases for the Board, was called by Willett pursuant to section 60 of the Civil Practice Act (Ill. Rev. Stat. 1979, ch. 110, par. 60). He testified that in 1980 he was responsible for the preparation of bids. To secure the greatest number of qualified bids, they were mailed to all firms on a bidders' list for bus transportation and advertisements were placed in the newspaper. In his opinion, the amendment might have had the effect of causing more bidders to bid on this contract; however, other regulation changes by the Board may have also had this effect. He did not personally inform Willett of the amendment. Prospective bidders were required to attach the solicitation for bids and amendments to bids to their proposals; however, the notice of the amendment at issue was not attached to Willett's proposal. Bidders could submit either an "all-or-nothing" bid on all 403 buses, or could bid on a lesser quantity on a price per bus per day basis; thus the Board could compare one "all-or-nothing" bid, such as Willett submitted, to an accumulation of smaller bids. The total cost to the Board for the contracts awarded was $36,835,270.56. Merges did not personally mail notices of amendments.

Sharon Tlanda, a secretary employed by Willett, Inc., testified that she was responsible for sorting mail for all of the Willett companies, including Willett, Inc., and Willett Motor Coach Co. *fn1 during the period in question. Plaintiff's offices were one block away from her own. All mail for plaintiff was placed in a separate box. Mail from the Board was placed in the same box, and ultimately such mail went to William Hood, one of plaintiff's officers. The receptionist, Kathy Pecoraro, also sorted mail. After the morning mail was sorted, someone from Willett, either Hood, Ray Skawski or Greg Bonnett, would pick up Willett's mail. The same routine was followed after the afternoon mail delivery.

It was stipulated that testimony of Kathy Pecoraro would be the same as Tlanda's except with regard to the afternoon mail.

Linda Keating, assistant secretary to the chairman of the board at Willett, Inc., testified that if any mail came from the Board she would inform Hood, and would either hold it until he picked it up or would take it to Willett's mailbox. She forwarded all mail from the Board except checks.

Gregory Bonnett and Raymond J. Skawski, employees of plaintiff, both testified that on occasion they picked up the morning and afternoon mail for plaintiff from Willett, Inc. Unless mail was directed to a specific individual, they brought it to Hood, who also received all mail from the Board.

Andrew Langert, assistant treasurer for Willett, Inc., and vice president of finance for plaintiff, testified that his duties included the preparation of bid proposals submitted to the Board. When he worked on the subject proposal he was not aware of the amendment to the bid solicitation. Plaintiff had submitted two other bids, for two other contracts, to the Board, both of which contained bilateral cancellation provisions. Knowledge of the amendment would have been important in preparing the proposal because if Willett did not have the option to cancel a contract it would have less leverage in negotiating with its drivers' labor union, which would in turn affect the cost estimate used in compiling the proposal.

William Hood, vice president of Spears Transportation, formerly vice president of plaintiff, testified that he was responsible for preparation of the subject proposal. He reiterated the routine for retrieving mail contained in previous testimony. Mail from the Board was addressed either to Willett, Inc., or plaintiff. Although he did receive the second amendment, which is not an issue in this lawsuit, he had no knowledge of the subject amendment until April 17, 1980, after bids were submitted, when Merges met with him and Langert and so informed them. The basic bid submitted by plaintiff was $225.84 per day per bus for a Type 1 bus. The "low price" on an alternative bid submitted was $196.74, which applied to a contract providing for older vehicles than those specified by the Board or where municipal bonds were to be used instead of performance bonds. Both were "all-or-nothing" bids. Had Hood had knowledge of the amendment, a bid would have been submitted from $163 to $168 per bus per day.

According to Hood, a subsequent bid submitted in July 1980, containing a mutual cancellation clause, on a contract involving over 300 buses, was $179.27 per day per bus, as the basic bid; an alternative bid of $164.47 per day per bus, for vehicles older than specified; and a second alternative bid of $177.05, in which municipal bonds were proposed instead of performance bonds. Another bid, predicated on a mutual cancellation provision regarding a contract for two buses for students attending O'Hare Airport, was for $225.84. A third bid involving 45 buses for children attending Walt Disney School, again based on a mutual cancellation clause ...


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