POTENTIAL LEGAL THEORIES TO STOP ILLEGAL BID SHOPPING PRACTICES
In the event you are forced to litigate to stop or remedy illegal bid shopping praactices, the following causes of action, at a minimum, might be raised in a legal complaint (lawsuit), seeking all applicable damages:
(1) Subletting and Subcontracting Fair Practices Act (Public Contractor Code Section 4100 et seq.), See case cited below.
(2) Unfair Business Practices under California Business and Professions Code Section 17200
(3) Fraud
(4) Deceit
(5) Promissory estoppel / equitable estoppel
(6) Breach of contract
(7) Punitive damages for willful, oppressive, and malicious conduct
(8) Other causes of action that may apply to the facts
California Case dealing with Bid Shopping:
R.J. Land & Associates Const. Co. v. Kiewit-Shea, 69 Cal.App.4th, 416 (App. 2 Dist. 1999) wherein the Court was faced with bid shopping allegations – a subcontractor suing the general for the generals failure to compensate the sub where there was not valid substitution of the party listed on the general’s bid. In reaching its finding that the subcontractor was entitled to lost profits, the court stated:
“To achieve the legislative purpose, the act: (1) requires the prime contractor to list in its bid each subcontractor who will perform work in an amount in excess of one-half of 1 percent of the prime contractor’s bid, to describe the work which will be done by each subcontractor, and to list only one subcontractor for each portion as defined in the prime contractor’s bid (Section 4104); (2) requires the prime contractor itself to perform any work for which the prime contractor either fails to specify a subcontractor or specifies more than one subcontractor for the same portion of work (Section 4106); and (3) prohibits the prime contractor to substitute any other subcontractor for the subcontractor listed in the original bid, except in specified narrow circumstances (Section 4107 and 4107.5) permits the awarding authority to consent to substitution of a different subcontractor under specified conditions”
The Court went on to hold that “Any violation of the act subjects the prime contractor to statutory penalties (§ 4110) and disciplinary action by the Contractors State License Board (§ 4111). These penalties do not limit or diminish any legal or equitable rights or remedies a subcontractor may have against the prime contractor. (§ 4103, subd. (a).). Section 4107 creates a statutory duty of the prime contractor toward the subcontractor, because unless the statutory exceptions are satisfied, the prime contractor “ha[s] no right to substitute another subcontractor in place of” the listed subcontractor; the statute “confers the right on the listed subcontractor to perform the subcontract unless statutory grounds for a valid substitution exist. Moreover, that right may be enforced by an action for damages against the prime contractor to recover the benefit of the bargain the listed subcontractor would have realized had he not wrongfully been deprived of the subcontract.” ( Southern Cal. Acoustics, supra, 71 Cal. 2d at 726.
