YAMAHA MOTOR MANUFACTURING CORPORATION OF AMERICA; CUNNINGHAM GOLF CAR COMPANY, INC. AND ROBERT B. NESMITH v. COMMONWEALTH OF KENTUCKY, FINANCE AND ADMINISTRATION CABINET; DEPARTMENT OF PARKS; GORDON C. DUKE, SECRETARY, FINANCE AND ADMINISTRATION CABINET, IN HIS OFFICIAL CAPACITY AND HIS INDIVIDUAL CAPACITY; M. HOLLIDAY HOPKINS, GENERAL COUNSEL, FINANCE AND ADMINISTRATION CABINET, IN HER OFFICIAL CAPACITY AND HER INDIVIDUAL CAPACITY, AND E-Z-GO TEXTRON, A DIVISION OF TEXTRON, INC.
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RENDERED:
NOVEMBER 10, 2005; 10:00 A.M.
TO BE PUBLISHED
MODIFIED:
DECEMBER 9, 2005; 10:00 A.M.
Commonwealth Of Kentucky
Court of Appeals
NO.
2004-CA-001172-MR
YAMAHA MOTOR MANUFACTURING
CORPORATION OF AMERICA;
CUNNINGHAM GOLF CAR COMPANY, INC.
AND ROBERT B. NESMITH
v.
APPELLANTS
APPEAL FROM FRANKLIN CIRCUIT COURT
HONORABLE ROGER CRITTENDEN, JUDGE
ACTION NO. 03-CI-00881
COMMONWEALTH OF KENTUCKY,
FINANCE AND ADMINISTRATION CABINET;
DEPARTMENT OF PARKS;
GORDON C. DUKE, SECRETARY, FINANCE
AND ADMINISTRATION CABINET, IN HIS
OFFICIAL CAPACITY AND HIS INDIVIDUAL
CAPACITY; M. HOLLIDAY HOPKINS,
GENERAL COUNSEL, FINANCE AND
ADMINISTRATION CABINET, IN HER OFFICIAL
CAPACITY AND HER INDIVIDUAL CAPACITY,
AND E-Z-GO TEXTRON, A DIVISION OF
TEXTRON, INC.
OPINION
REVERSING IN PART;
VACATING IN PART; AND REMANDING
** ** ** ** **
BEFORE:
COMBS, CHIEF JUDGE; HENRY AND MINTON, JUDGES.
APPELLEES
HENRY, JUDGE:
Yamaha Motor Manufacturing Corporation of
America, Cunningham Golf Car Company, Inc., and Robert B.
Nesmith appeal from a March 25, 2004, Opinion and Order of the
Franklin Circuit Court granting a motion for summary judgment
against them on the ground that they lacked standing for the
lawsuit in question.
On review, we reverse and remand in part,
and vacate and remand in part.
On April 21, 2003, the Commonwealth of Kentucky,
Finance and Administration Cabinet (hereinafter “the Cabinet”),
issued Solicitation Number S-03109161 pursuant to KRS 1 45A.080,
with bids closing on May 13, 2003.
The solicitation was for 290
gas-powered golf carts, a driving range golf cart with a
protective cage, and five (5) “ADA compliant” golf carts for use
at various state park golf courses.
The solicitation listed
Yamaha-brand equipment (or its equivalent) as the specification
standard and stated that the contract award would be made on a
“best value” basis, pursuant to certain stated criteria.
Two
modifications to the solicitation were issued on April 22nd and
April 29th, with the first correcting formatting and clauses, and
the second answering vendor requests for clarification.
modification changed the specifications set forth in the
solicitation.
1
Kentucky Revised Statutes.
-2-
Neither
Bids were submitted by Century Equipment of
Cincinnati, Ohio; Cunningham Golf Car Company, Inc. (hereinafter
“Cunningham”); and Appellee E-Z-Go Division of Textron, Inc.
(hereinafter “E-Z-Go”).
May 29, 2003.
The contract was awarded to E-Z-Go on
On June 10, 2003, Cunningham filed a formal
protest with the Secretary of the Finance and Administration
Cabinet, pursuant to KRS 45A.285.
The challenge had two bases:
(1) E-Z-Go’s proposed “ADA compliant” golf carts did not meet
the published bid specifications set forth under the
solicitation and, accordingly, the bid was “non-responsive”; and
(2) the purchasing agency acted improperly in considering
maintenance costs for the carts only for the first year of use,
as opposed to the anticipated maintenance costs of the carts
over their entire projected useful life.
In a June 18, 2003,
letter, the Cabinet denied Cunningham’s protest. 2
On July 17, 2003, Appellants filed a Verified
Complaint in the Franklin Circuit Court against the Finance and
Administration Cabinet; the Department of Parks; Gordon C. Duke,
Secretary of the Finance and Administration Cabinet; M. Holliday
Hopkins, General Counsel for the Finance and Administration
2
This letter gave a number of justifications for the Cabinet’s decision to
deny Appellants’ protest, but as this appeal deals solely with the issue of
Appellants’ standing to sue, we will not go into further detail about these
justifications here.
-3-
Cabinet; and E-Z-Go, pursuant to KRS 45A.245 3 and KRS 13B.140. 4
The Complaint again alleged that the proposed golf carts offered
by E-Z-Go failed to meet a number of certain requirements set
forth in the bid solicitation, and that the purchasing agent
failed to consider the anticipated maintenance costs of the golf
carts over their entire projected useful life.
The Complaint
then alleged that these actions constituted violations of the
Kentucky Model Procurement Code (hereinafter “KMPC”), KRS
45A.005 et seq., and that the Finance and Administration
Cabinet’s failure to consequently reject E-Z-Go’s bid as “nonresponsive” was arbitrary, capricious, and contrary to law.
The
Complaint also asked for taxpayer relief on behalf of Appellant
Nesmith because the alleged actions constituted wrongful acts
that would result in injury to the Commonwealth and to Nesmith
as a taxpayer.
On November 3, 2003, the Cabinet filed a motion for
summary judgment contending that Appellants’ claims were barred
by sovereign immunity and that Appellants lacked standing to
pursue their claims.
On March 25, 2004, the trial court denied
the Cabinet’s motion as to sovereign immunity, but granted it on
3
We note that KRS 45A.245 does not appear to be an appropriate basis for
circuit court jurisdiction here, as this provision is only concerned with
claims brought by persons with “lawfully authorized written contract[s] with
the Commonwealth.” KRS 45A.245(1). A disappointed bidder does not fit within
this requirement.
4
Appellants later amended their Complaint to include jurisdiction pursuant to
KRS Chapter 418, which deals with declaratory judgments.
-4-
the ground that Appellants lacked standing to challenge the
contract award.
The trial court first noted that the case
presented “two fundamental concerns inherent in the concept of
judicial review of disappointed bidder protests,” with the first
being “the enforcement of the Kentucky Model Procurement Code,
(“KMPC”),” and the second being “to avoid daily judicial review
of every contract decision made by the Executive Branch.”
As to the first concern, the trial court noted that
the “Commonwealth may benefit from lawsuits that seek to ensure
that contractors and administrative agencies are following
statutory requirements and will work together to achieve the
KMPC’s basic purpose.”
The court added:
Competitive bidder legal challenges may
ensure the bidding process is being
conducted with integrity and fairness. If
standing is denied to all unsuccessful
competitive bidders, then it appears that no
other party will challenge wrongfully
awarded contracts. If parties seeking to
enforce the KMPC do not have standing, this
statute becomes a powerless law. (Italics
in original).
The court then turned to its second concern, stating:
“Still, an overwhelming flood of administrative appeals could
disrupt the operations of both the Executive and Judicial
branches of government.”
It then specifically noted:
At times the state entity soliciting a
procurement contract may fail to follow its
own bid solicitation and award the contract
to a non-responsive bidder. The question
-5-
then becomes, does every failure of a state
entity to match its own bid solicitation
give rise for disappointed bidders to
judicially appeal the state’s procurement
decision?
The court then answered its own inquiry,
stating: “Pendleton Bros. Vending, Inc. v. Com.
Finance and Admin. Cabinet, Ky., 758 S.W.2d 24 (1988),
answered that question in the negative.” 5
After giving its reasons why sovereign immunity
protection was inapplicable in this case, the trial court turned
its attention to the question of standing.
It first stated:
“The fundamental question of the instant case becomes: does a
Plaintiff have standing to challenge the Cabinet’s decision to
award a contract to a company that is alleged to have failed to
supply ‘ADA Compliant’ golf carts,” and then concluded: “This
Court believes that it does not.”
In support of this
conclusion, the trial court first noted:
Here this Court must find the
Plaintiffs/unsuccessful bidders’ substantial
interest in the instant matter. If the
Plaintiffs were to win the lawsuit, the
government contract would be rescinded.
Afterwards, the Plaintiffs may bid once more
in competition for the contractual award.
However, the Plaintiffs would not be
entitled to any award as a matter of right,
but instead the Plaintiffs would be entitled
to once again compete for the contract.
5
In a footnote, the trial court cited to page 30 of the Pendleton Bros.
opinion for the principle that “every purchasing decision or alleged omission
is not subject to judicial oversight.”
-6-
Because of this, the trial court concluded: “The Plaintiffs are
entitled to a mere expectancy.
As such, this interest is not
present or substantial and this Court is unable to confer
subject matter jurisdiction.
See, Plaza B.V. v. Stephens, Ky.,
913 S.W.2d 319, 322 (1996).”
The trial court then turned its attention to the
Kentucky Supreme Court’s decision in HealthAmerica Corp. of Ky.
v. Humana Health Plan, Inc., 697 S.W.2d 946 (Ky. 1985), which
holds that “absent a showing of fraud, collusion or dishonesty,
a disappointed bidder has no standing to judicially challenge
the award of a public contract to another bidder.”
Id. at 498.
The trial court noted, however, that this rule applies “[w]hen
the KMPC is not implicated,” and that “the KMPC may provide for
some exceptions to the general rule.”
The trial court then
specifically cited KRS 45A.280 for the proposition that “[t]he
public officials carrying out the code ‘shall not be disturbed
unless the decision was procured by fraud or the findings of
fact by such official ... do not support the position.’”
The
court concluded that Appellants did not allege facts that met
these exceptions and ultimately held:
Although the Pendleton Brothers Court
conferred standing upon other unsuccessful
bidders, the allegations of political
patronage were so egregious, offensive to
justice and analogous to fraud that
conferring standing was ultimately within
the standard adopted in HealthAmerica. In
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comparison, the instant Complaint does not
allege similar facts that meet the level of
serious official or state sponsored
misconduct or impropriety that the Pendleton
Brothers Court excepted for standing
purposes. Under Pendleton Brothers and
HealthAmerica the Plaintiffs lack standing
to pursue this action.”
Appellants subsequently filed a motion to alter,
amend, or vacate that was denied in a May 21, 2004, Opinion and
Order.
In that Opinion and Order, the trial court again
acknowledged that Pendleton Bros. expanded the scope of
HealthAmerica, but it concluded that the expansion pertained
only to “egregious and offensive political patronage on the part
of the Commonwealth” and that Appellants were not aided by this
expansion.
The court then noted:
The Plaintiffs’ allegations do not rise to
the level of fraud, collusion, dishonesty or
political patronage on behalf of the
Commonwealth. Therefore standing is not
afforded the Plaintiffs and this action must
be dismissed for a lack of jurisdiction.
The trial court also found that Nesmith had no standing to sue
as a taxpayer because the cases upon which he relied as grounds
for standing were distinguishable from the case at hand. 6
This
appeal followed.
The standard of review for a summary judgment pursuant
to CR 56.03 is set forth in Steelvest, Inc. v. Scansteel Service
6
Specifically, Appellants relied upon Gay v. Haggard, 133 Ky. 425, 118 S.W.
299 (1909); Board of Education of Floyd County v. Hall, 353 S.W.2d 194 (Ky.
1962); and Price v. Commonwealth, Transportation Cabinet, 945 S.W.2d 429
(Ky.App. 1996).
-8-
Center, Inc., 807 S.W.2d 476 (Ky. 1991).
Steelvest holds that
it is the function of the appellate court to determine whether
the trial court correctly found that there was no genuine issue
as to any material fact and that the moving party was entitled
to judgment as a matter of law.
Scifres v. Kraft, 916 S.W.2d
779, 781 (Ky.App. 1996).
“Since the issue is wholly one of law,
our review is de novo.”
Fourroux v. City of Shepherdsville, 148
S.W.3d 303, 306 (Ky.App. 2004).
“In order to have standing in a lawsuit, ‘a party must
have a judicially recognizable interest in the subject matter of
the suit.’”
City of Ashland v. Ashland F.O.P. No. 3, Inc., 888
S.W.2d 667, 668 (Ky. 1994), citing HealthAmerica, supra; see
also Deters v. Kenton County Public Library, 168 S.W.3d 62, 63
(Ky.App. 2005) (Citations omitted).
“The interest of a
plaintiff must be a present or substantial interest as
distinguished from a mere expectancy.”
City of Ashland, 888
S.W.2d at 668, citing Winn v. First Bank of Irvington, 581
S.W.2d 21 (Ky.App. 1979); see also Deters, 168 S.W.3d at 63.
“The issue of standing must be decided on the facts of each
case.”
City of Ashland, 888 S.W.2d at 668, citing Rose v.
Council for Better Education, Inc., 790 S.W.2d 186 (Ky. 1989);
City of Louisville v. Stock Yards Bank & Trust Co., 843 S.W.2d
327 (Ky. 1992).
“Simply because a plaintiff may be a citizen
and a taxpayer is not in and of itself sufficient basis to
-9-
assert standing.
There must be a showing of a direct interest
resulting from the ordinance.”
Id., citing Carrico v. City of
Owensboro, 511 S.W.2d 677 (Ky. 1974); York v. Chesapeake & Ohio
Railroad Co., 240 Ky. 114, 41 S.W.2d 668 (1931).
With these general rules of standing in mind, we turn
specifically to the issue of the standing of a disappointed
bidder to challenge the decision of a purchasing agency such as
the Finance and Administration Cabinet.
As recognized by the
trial court and the parties, it is well-established that
[t]he general rule in Kentucky if the KMPC
is not involved, as stated in HealthAmerica,
697 S.W.2d at 948, is that “absent a showing
of fraud, collusion or dishonesty, a
disappointed bidder [as such] has no
standing to judicially challenge the award
of a public contract to another bidder."
Pendleton Bros., 758 S.W.2d at 24; see also PIE Mut. Ins. Co. v.
Kentucky Med. Ins. Co., 782 S.W.2d 51, 54 (Ky.App. 1990) (“The
common law rule in Kentucky is that absent allegations of fraud,
bad faith, or collusion, a competitor qua competitor has no
standing to challenge the granting of a license or permit to
another competitor by an administrative agency.”) (Citations
omitted).
With this said, in Pendleton Bros., the Supreme Court,
while acknowledging the common law rule, concluded that “the
purpose of the procurement code is to elevate state purchasing
to a higher level of conduct.
To accomplish this, the KMPC
-10-
imposes rules with objective criteria in purchasing, criteria
previously lacking, and provides enforcement for these
standards.”
Id. at 27.
Consequently, the Supreme Court
determined that the KMPC “has changed the rules of the game,
providing access not previously available to challenge and
investigate the propriety of government purchasing contracts.”
Id. at 24.
Specifically—and of particular importance here—the
Supreme Court asked whether the KMPC had effected a statutory
change so that procurement is now a regulated administrative
procedure subject to court challenge if the decision is contrary
to law, or arbitrary and capricious.
It answered this question
in the affirmative, allowing the appellants’ suit to proceed.
See id. at 25, 28-29.
To aid in the application of this
holding, however, the Court cautioned that “every purchasing
decision or alleged omission is not subject to judicial
oversight.”
Id. at 30.
However, despite the conclusions reached in Pendleton
Bros. that the KMPC “has changed the rules of the game,” and
that procurement is now a regulated administrative procedure
subject to court challenge if the decision is contrary to law,
or arbitrary and capricious, the trial court here concluded that
the decision in Pendleton Bros. fit within the common law
standard set forth in HealthAmerica because the issues of
political patronage present in Pendleton Bros. were tantamount
-11-
to fraud.
Moreover, as previously noted, the trial court here
concluded that the expansion set forth in Pendleton Bros.
pertained only to “egregious and offensive political patronage
on the part of the Commonwealth” and that in order for standing
to exist, the Appellants must make allegations of “fraud,
collusion, dishonesty or political patronage on behalf of the
Commonwealth.”
We simply cannot conclude that this is a reasonable
interpretation of the Pendleton Bros. decision given what we
believe to be the Supreme Court’s clear conclusion that the KMPC
had made procurement a regulated administrative procedure
subject to judicial challenge.
As the Supreme Court noted, the
“supremacy of law demands that here shall be opportunity to have
some court decide” whether an agency administering a statutory
regulatory scheme has applied “an erroneous rule of law . . .
and whether the proceedings in which the facts were adjudicated
was [sic} conducted regularly.”
Pendleton Bros., 758 S.W.2d at
28, quoting Humana of Ky., Inc., et al. v. NKC Hospitals, Inc.,
et al., 751 S.W.2d 369, 374 (Ky. 1988).
The Court added:
As in Humana, here it is the regulatory
scheme which both establishes the rules
which must be followed and provides standing
to the aggrieved competitor to challenge the
decision of the administrative agency in
court if he can prove that the decision or
award was made in violation of the statute.
-12-
Id.
Because the administrative remedies in the case had been
exhausted, the Court concluded that it was “ripe for judicial
review.
The appellants are entitled to a forum and an
opportunity to prove their case.”
Id. at 28-29.
Given this
language, we are compelled to find that the Supreme Court
intended its decision to reach beyond the scope of alleged
political patronage.
Additionally, we note that the Supreme Court framed
its inquiry in Pendleton Bros. as follows:
We must decide whether the KMPC has effected
a statutory change so that procurement is
now a regulated administrative procedure
subject to a court challenge if the decision
was contrary to law, or arbitrary and
capricious. This includes challenge on
grounds that statutory procedures were
disregarded for reasons of political
patronage.
Id. at 25 (Emphasis added).
We believe that this language
serves as an indication that the Court considered the specific
allegations of political patronage in that case to be an issue
that was encompassed by the more general inquiry being
undertaken as to the availability of judicial relief under the
KMPC for disappointed bidders.
We also believe that KRS 45A.280 supports the
principle that judicial review is available to disappointed
bidders under the KMPC.
That statute provides:
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The decision of any official, board, agent,
or other person appointed by the
Commonwealth concerning any controversy
arising under, or in connection with, the
solicitation or award of a contract, shall
be entitled to a presumption of correctness
and shall not be disturbed unless the
decision was procured by fraud or the
findings of fact by such official, board,
agent or other person do not support the
decision.
The latter part of the statute specifically supports the
conclusion that a decision of the Finance and Administration
Cabinet, while presumed correct, is subject to “disturbance” by
a court in the event that the Cabinet’s findings of fact do not
support its decision.
This standard does not differ in any
significant way from the general rule that decisions of
administrative agencies are reviewed by courts with the question
of arbitrariness in mind.
See American Beauty Homes Corp. v.
Louisville and Jefferson County Planning and Zoning Comm’n, 379
S.W.2d 450, 456 (Ky. 1964).
Consequently, we hold that the
trial court erred in concluding that Appellant Cunningham Golf
Car Company, Inc., as a disappointed bid contractor, did not
have standing to challenge the decision of the Finance and
Administration Cabinet on the grounds that it was arbitrary and
capricious, and we must therefore reverse and remand for further
proceedings. 7
7
We include Cunningham, but not Yamaha, in this particular holding for
reasons that will be set forth later in this opinion.
-14-
Appellants next argue that the trial court erred in
dismissing Appellant Robert Nesmith’s claim for lack of
standing.
They specifically contend that “Kentucky law provides
that when governmental bodies violate statutes pertaining to
competitive bidding for public contracts, such failure renders
any resulting contracts void and taxpayers have standing to
bring suit to recover monies paid pursuant to such void
contracts.”
We agree with the Appellants that the trial court
erred in concluding that Appellant Nesmith could not have
grounds for standing in this case, but we disagree that any
taxpayer would have standing to bring suit here.
Along with the more general rules for standing set
forth above, our courts have held that, in order for a taxpayer
to have standing to challenge an administrative decision, there
must be “an allegation and proof that the plaintiff would suffer
some injury distinct from that of the general public before he
could have standing to enjoin an official act.”
Deters, 168
S.W.3d at 63, quoting Fish v. Elliott, 554 S.W.2d 94, 96
(Ky.App. 1977) (Additional citations omitted); see also City of
Ashland, 888 S.W.2d at 668 (Citations omitted); Wegener v.
Wehrman, 312 Ky. 445, 446, 227 S.W.2d 997, 998 (1950) (Citation
omitted).
Accordingly, in order for a taxpayer to have standing
to challenge the Finance and Administration Cabinet here, one
would have to establish that the claimed injury that he would
-15-
suffer is distinct from that of the general public.
Simply
being a taxpayer is not enough.
While neither party cited Pendleton Bros. for this
principle, the Supreme Court there also recognized that
taxpayers, as such, may have a judicially recognizable
interest in the award of a public contract where a
disappointed competitor does not, at least where there
is proof “that there was an abuse of discretion on the
agency’s part amounting to ... arbitrariness or
capriciousness in awarding the contract.”
Pendleton Bros., 758 S.W.2d at 25, quoting Handy v. Warren
Co. Fiscal Court, 570 S.W.2d 663, 664 (Ky.App. 1978).
The Court
made this statement in the context of the Finance and
Administration Cabinet’s acknowledgement that the four (4)
taxpayers who had joined in the suit may have standing in the
above-referenced situation, and it did nothing to take issue
with this acknowledgement.
It is important to note, however,
that these taxpayers were apparently principals of Pendleton
Bros., which–in accordance with the requirements for taxpayer
standing set forth above–suggests that they were alleging an
injury distinct from one that could be claimed by the general
public.
Accordingly, given the language in Pendleton Bros.
suggesting that taxpayers can have standing to challenge a bid
contract award where there is proof of arbitrariness or
capriciousness, and the general rule that taxpayers may have
-16-
standing to sue where they have suffered a distinct injury, we
conclude that the trial court erred in determining that
Appellant Nesmith lacked standing as a taxpayer without
considering in further detail his relationship to the parties
and his direct interest in the bid contract in question.
We
must therefore vacate this particular ruling and remand for
further consideration.
We next turn briefly sua sponte to an issue not
addressed by the parties or the trial court; that is, the
question of the presence of Yamaha Motor Manufacturing
Corporation of America as a party plaintiff in this lawsuit.
In
the complaint Yamaha is described only as a Georgia corporation
licensed to do business in Kentucky and in good standing with
the Kentucky Secretary of State.
For all of the discussion of
standing in the briefs and in the circuit court’s Opinion and
Order, there is no mention of Yamaha’s standing, and we confess
a degree of puzzlement as to why this is the case.
disappointed bidder is Cunningham.
is a taxpayer.
The
Nesmith, as discussed above,
It is not difficult to deduce that Yamaha hopes
to furnish the golf carts at issue if Cunningham eventually
prevails in its bid, but we find nothing in our case law or
statutes that confers standing upon prospective suppliers of
disappointed bidders.
We urge the circuit court to delve
-17-
further into this aspect of the case on remand and enter any
appropriate orders.
We also note for clarification that we have concerned
ourselves solely with the issue of standing and not with the
strength of the underlying allegations in the case.
With this
said, we conclude that the holding of Pendleton Bros. is broad
enough to confer standing upon a disappointed bidder who alleges
that a bid contract was awarded based upon a bid that was not
responsive to the specifications published by the state agency
to such an extent that the award was arbitrary, capricious, and
contrary to law. 8
This case is reversed in part, vacated in
part, and remanded for further proceedings consistent with this
opinion.
MINTON, JUDGE, CONCURS.
COMBS, CHIEF JUDGE, DISSENTS AND FILES SEPARATE
OPINION.
COMBS, CHIEF JUDGE, DISSENTING:
Both the opinions of
the trial court and of the majority of this Court have
articulated carefully reasoned and legally persuasive statements
(albeit reaching opposite conclusions) as to the law governing
the standing of disappointed bidders for state contracts under
the Kentucky Model Procurement Code (the KMPC).
8
After studying
This holding is consistent with that of a different panel of our Court in the
recent case of Laboratory Corporation of America Holdings v. Rudolph,
____S.W.3d____ (Ky.App. 2005), 2004-CA-001025-MR, 2005 WL 1792146, Petition
for Rehearing pending, opinion designated “To Be Published”.
-18-
the pertinent case law on this subject, I am compelled to
dissent from our majority opinion and to vote to affirm the
opinion of the Franklin Circuit Court, which emphasized the
critical need for an allegation of egregiously fraudulent
conduct as a basis for a judicial challenge to a competitive
bidding situation.
It is the purpose of the KMPC to assure integrity of
the bidding process by opening the entire process to public
scrutiny in order to assure probity and fairness.
However, the
statute itself carefully provides the language that impliedly
serves as a basis for Pendleton Bros., supra:
The decision of any official, board, agent,
or other person appointed by the
Commonwealth concerning any controversy
arising under, or in connection with, the
solicitation or award of a contract, shall
be entitled to a presumption of correctness
and shall not be disturbed unless the
decision was procured by fraud or the
findings of fact by such official, board,
agent or other person do not support the
decision. KRS 45A.280 (Emphasis added).
That statutory language imposing a presumption of propriety is
the crux of the reasoning of the trial court, compelling it to
search for the presence of fraud or for at least some intimation
of impropriety in the bidding process at issue.
Absent such
allegations, the lawsuit simply cannot be maintained-regardless of the “distinct interest” of any of the parties from
-19-
that of the general taxpaying population or the mere expectancy
interest entailed in the ultimate outcome of the case.
A court simply has no legitimate basis to intervene
under the very language of the KMPC and pursuant to the cases
constraining it.
As properly noted by the trial court, the
court system would become a constant referee in the bidding
process of state contracts unless such a threshold finding of
fraudulent conduct would justify its involvement.
As this issue was a question of law, summary judgment
was correctly entered by the Franklin Circuit Court.
I would
affirm that judgment.
BRIEF FOR APPELLANT:
BRIEF FOR APPELLEE:
F. Chris Gorman
Kenneth A. Bohnert
Gregory D. Stumbo
Attorney General
Edward L. Lasley
Louisville, Kentucky
Raymond F. DeBolt, Jr.
Frankfort, Kentucky
Larry C. Deener, Esq.
Lexington, Kentucky
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