IN THE MATTER OF PROTEST OF SCHEDULED AWARD OF TERM CONTRACT T2813 RFP 12-X-22361

NOT FOR PUBLICATION WITHOUT THE

APPROVAL OF THE APPELLATE DIVISION

 

SUPERIOR COURT OF NEW JERSEY

APPELLATE DIVISION

DOCKET NO. A-0

IN THE MATTER OF PROTEST OF SCHEDULED AWARD OF TERM CONTRACT T2 813 RFP 12-X-22361 LABORATORY TESTING SERVICE, EQUINE DRUG TESTING.

 

Argued June 11, 2013 - Decided

Before Judges Parrillo and Messano.

On appeal from the Department of the Treasury, Division of Purchase and Property.

Robert C. Epstein argued the cause for appellant HFL Sport Science, Inc. (Greenberg Traurig, attorneys; Mr. Epstein, on the brief).

Melissa A. Haas, Deputy Attorney General, argued the cause for respondent Division of Purchase and Property (John J. Hoffman, Acting Attorney General, attorney; Beth Leigh Mitchell, Assistant Attorney General, of counsel; Ms. Haas, on the brief).

PER CURIAM

Appellant HFL Sport Science, Inc. (HFL), appeals the final agency decision of the Director of the Division of Purchase and Property (DPP) in the Department of the Treasury, rescinding the award of a State contract to perform equine drug testing to HFL, and re-awarding the contract to Truesdail Laboratories, Inc. (Truesdail). For reasons that follow, we affirm.

On November 21, 2011, the DPP issued a Request for Proposal (RFP), soliciting bid proposals from laboratories to provide equine drug testing on racehorses as required by the New Jersey Racing Commission. The RFP sought "to award a contract to that responsible bidder whose bid proposals, conforming to this RFP is most advantageous to the State, price and other factors considered." The contract would have a duration of two years with the option to renew for two additional one-year periods at the State's discretion. Especially pertinent here, section 4.4.1.2 of the RFP required bidders, pursuant to N.J.S.A. 52:25-24.2, to submit an ownership disclosure form (ODF) at the same time, or before, they submitted their bid proposals.

The bid opening was held on December 29, 2011, and the DPP received four proposals, including those from HFL and Truesdail. HFL's ODF included with its bid proposal indicated that there were no individuals, corporations or partnerships having a 10% or greater interest in HFL.1

Contrary to this representation, in a narrative section of its technical proposal, HFL stated that it is a wholly-owned subsidiary of another firm, LGC Group, which is in turn owned by a private equity firm, Bridgepoint Capital. Elsewhere in the proposal, an organization chart indicated that HFL is a sister company of HFL Sport Science, Ltd., and that both are owned by LGC Science & Technology, which is itself owned by LGC Group. However, nowhere in its proposal did HFL provide the "names and addresses of all stockholders . . . who own 10% or more of its stock," as required by N.J.S.A. 52:25-24.2.

On February 23, 2012, DPP issued an award notice, recommending the contract be awarded to HFL as the lowest bidder and having earned the highest total score.2 On March 8, 2012, Truesdail protested the proposed contract award, alleging, among other things, that the DPP incorrectly calculated the bid prices and that Truesdail was actually the lowest price bidder. Following HFL's opposition, the DPP Director found Truesdail's objections to be without merit.

However, while reviewing the procurement record, the Director noticed that HFL had submitted what appeared to be conflicting ownership disclosure information in its proposal and therefore requested clarification. On May 24, 2012, a representative of HFL responded with an organizational chart that was in some respects different and more detailed than the one included in its proposal. The new chart indicated that HFL is owned by HFL Sport Science, Ltd., which differed from information previously disclosed, and that HFL Sport Science, Ltd. is in turn owned by LGC Ltd. Above LGC, Ltd., however, were seven more tiers of ownership all omitted from HFL's original submission ending with LGC Science Group Ltd. at the top. The representative also confirmed that LGC Science Group, Ltd. is owned by Bridgepoint, previously identified in HFL's bid proposal, which she described as a private equity group over which "LGC does not have control." HFL's representative further explained that HFL answered "no" to the question on the ODF concerning whether another entity had a 10% or greater interest in HFL within the past five years because the direct ownership of HFL has never changed since its incorporation and HFL understood the question to only refer to changes in ownership over the preceding five years.

In her October 12, 2012 final agency decision rescinding the notice of intent to award the contract to HFL, and ordering that the contract be awarded to Truesdail, the DPP Director concluded that HFL's failure to provide complete disclosure of all levels of its ownership structure on its ODF at the time its proposal was submitted rendered its proposal incurably nonresponsive to the RFP and ineligible for the contract award. Specifically, the Director found

inconsistent information regarding [HFL's] ownership structure in its proposal. In the required Ownership Disclosure Form included as part of its proposal, [HFL] stated that there was no individual, partnership, corporation or other owner having a 10 percent or greater interest in that entity. However, in a narrative segment of its technical proposal, [HFL] stated that it is a wholly-owned subsidiary of LGC Limited and not a sibling organization of [HFL Sport Science, Ltd.]

The Director acknowledged that HFL responded to the agency's request for clarification, but found the original defect in disclosure to render HFL's proposal incurably nonresponsive:

This information provided by [the HFL representative] clarified certain inconsistencies within [HFL's] proposal and is therefore enlightening and helpful. However, it is clear from the above that [HFL] failed to provide complete disclosure of all levels of its ownership structure on its Ownership Disclosure Form at the time its proposal was submitted, as required by N.J.S.A. 52:25-24.2. This type of proposal defect is generally considered material and is therefore not curable after proposal opening. See George Harms Constr. Co. v. Borough of Lincoln Park, 161 N.J. Super. 367, 375 (Law Div. 1978). . . . .

Here, [HFL's] proposal reported that it was owned by LGC Science & Technology, which was in turn owned by an LGC Group entity. In contrast, its complete ownership disclosure as provided post-proposal indicated that [HFL] is owned by HFL Sport Science, Ltd., which is owned by a chain of LGC entities, the highest of which is owned by Bridgeport. . . . Further, there was no recent prior disclosure by [HFL] to DPP of its full ownership.

On October 16, 2012, HFL requested a stay from DPP of its decision to award the contract to Truesdail, pending appeal, arguing that the Director misapplied N.J.S.A. 52:25-24.2 in rejecting HFL's bid. The Director denied HFL's request for a stay and the DPP issued a new notice of award on October 17, 2012, awarding the contract to Truesdail.

HFL filed a timely protest of the October 17 notice of award, again arguing that the DPP erred in applying N.J.S.A. 52:25-24.2 to reject its bid, and that the information it provided to the DPP regarding its ownership after bids were opened was a permissible clarification of information in its bid proposal. HFL also argued that Truesdail's proposal should be rejected as nonresponsive, as it did not provide answers to the five questions printed at the top of the ODF.

On December 20, 2012, the DPP Director issued a final agency decision rejecting HFL's protest and upholding the award of the contract to Truesdail. The Director reasoned:

In its letter of protest, HFL lists several places in its narrative proposal that mention its parent and sibling entities, as evidence that HFL made full and accurate disclosure of its ownership, consistent with its later response to the hearing officer's request for clarification. However, the listed statements, for the most part, simply name these entities and suggest that some form of ownership or other relationship exists among them and HFL. These narrative statements do not provide a clear hierarchy of ownership, nor do they provide ownership percentages or addresses for each entity that would allow verification of compliance with the statutory requirement that the names and addresses of all 10 percent or greater owners be disclosed.

The Director reiterated that "HFL's post-bid opening communications cannot . . . serve to cure the discrepancies in its ownership disclosure."

Thereafter, the Director denied HFL's application for a stay pending appeal, as did we.

On appeal, HFL raises the following issues:

I. THE DPP DECISION IS SUBJECT TO DE NOVO REVIEW AND IS ENTITLED TO NO DEFERENCE

II. THE DPP MISAPPLIED N.J.S.A. 52:25-24.2 AND THEREFORE THE COURT SHOULD REVERSE THE DPP RULING AND ORDER THAT CONTRACT T2813 BE AWARDED TO HFL

A. The DPP's Ruling

B. The DPP Misapplied the Statute

III. HFL SUBSTANTIALLY COMPLIED WITH N.J.S.A. 52:25-24.2 AND THEREFORE THE COURT SHOULD REVERSE THE DPP RULING AND ORDER THAT CONTRACT T2813 BE AWARDED TO HFL

A. The Statute and Governing Case Law

B. HFL Substantially Complied With the Statute

1) HFL's Proposal Provided Essential Ownership Disclosures

2) HFL's Ownership Disclosures Satisfied the Statute

IV. THE DPP'S REJECTION OF HFL'S BID AND RE-AWARD TO TRUESDAIL CREATES THE APPEARANCE OF FAVORITISM

I.

HFL's essential contention is that N.J.S.A. 52:25-24.2 does not require disclosure of corporate or entity ownership but only of individuals who hold a 10% or greater interest in the bidder. We disagree.

As a threshold matter, we note that our review of a final agency decision is limited. Russo v. Bd. of Trustees, Police & Firemen's Ret. Sys., 206 N.J. 14, 27 (2011) (citing In re Herrmann, 192 N.J. 19, 27 (2007)). Ordinarily, we will not upset the final decision of an administrative agency unless shown that the decision was arbitrary, capricious or unreasonable, violated express or implied legislative policies, or is not supported by substantial credible evidence in the record as a whole. Thurber v. City of Burlington, 191 N.J. 487, 501 (2007); Campbell v. Dep't of Civil Serv., 39 N.J. 556, 562 (1963).

Although we defer to the agency's expertise, interpretation of statutes is ultimately a judicial, not administrative function, and we are "in no way bound by the agency's interpretation of a statute or its determination of a strictly legal issue." Thurber, supra, 191 N.J. at 502. See also Mayflower Sec. Co. v. Bureau of Sec., 64 N.J. 85, 93 (1973). Therefore, review of an agency's interpretation of law is de novo. Russo, supra, 206 N.J. at 27 (citing Toll Bros., Inc. v. Twp. of W. Windsor, 173 N.J. 502, 549 (2002)).

Moreover, the standard of review of an agency's decision of whether a bid conformed to the requirements of a bid request is the "ordinary standard for administrative action, namely, that the determination was not arbitrary or unreasonable." DGR Co. v. State, Dep't of Treasury, Div. of Prop. Mgmt. and Constr., 361 N.J. Super. 467, 474 (App. Div. 2003) (citing In re Protest of Award of On-Line Games Prod. and Operation Servs. Contract, 279 N.J. Super. 566, 593 (App. Div. 1995)).

Thus, our review of the Director's conclusion that N.J.S.A. 52:25-24.2 requires disclosure of all "entities" having at least a 10% ownership interest in the bidder is de novo. Assuming the Director's statutory construction is correct, we review her application of the statutory requirement to the ownership information provided by HFL to determine whether it was arbitrary, capricious or unreasonable.

N.J.S.A. 52:25-24.2 prohibits the State from awarding a contract to any corporation or partnership

unless prior to the receipt of the bid or accompanying the bid, of said corporation or said partnership, there is submitted a statement setting forth the names and addresses of all stockholders in the corporation or partnership who own 10% or more of its stock. . . . If one or more such stockholder or partner is itself a corporation or partnership, the stockholders holding 10% or more of that corporation's stock . . . shall also be listed. The disclosure shall be continued until names and addresses of every noncorporate stockholder, and individual partner, exceeding the 10% ownership criteria established in this act, has been listed.

[(Emphasis added).]

When interpreting a statute, a court

first considers the plain meaning of the provision at issue. Such language should be given its ordinary meaning, absent a legislative intent to the contrary. When a statute is silent or ambiguous, however, the Court must interpret the statute in light of the Legislature's intent. In order to ascertain legislative intent, the Court may look to extrinsic evidence, including legislative history, committee reports, and contemporaneous construction. The primary task for the [C]ourt is to effectuate the legislative intent in light of the language used and the objects sought to be achieved.

[Burns v. Belafsky, 166 N.J. 466, 473 (2001) (citations and internal quotation marks omitted).]

In Schlumberger Industries, Inc. v. Borough of Avalon, 252 N.J. Super. 202 (App. Div. 1991), certif. denied, 130 N.J. 8 (1992), we explained the reach of N.J.S.A. 52:25-24.2, in light of the provision's clearly expressed language, together with the statutory purposes sought to be effectuated:

N.J.S.A. 52:25-24.2 applies solely to corporations or partnerships, and requires disclosure of the names of partners or shareholders owning 10% or more of the entity. If the stockholders in turn are corporations or partnerships there must be continued disclosure until all individuals are named who exceed the 10% ownership criterion. The obvious purpose of the statute is to prevent favoritism by denying an individual the use of a corporate or partnership name to hide his or her true identity, when knowledge of this identity could affect public bidding.

[Id. at 208 (emphasis added).]

HFL's contrary interpretation that the statute "refer[s] to individual, not corporate, stockholders or partners,"3 runs directly counter to the plain language of the statutory provision in issue. N.J.S.A. 52:25-24.2 explicitly states that if a 10% or greater owner of a corporation or partnership "is itself a corporation or partnership," that entity's 10% or greater owners must also be disclosed. There would be no need for such a provision if the Legislature intended to require that bidders disclose only individual 10% or greater owners, and not corporate owners. The plain meaning of the statute, therefore, is that all 10% or greater owners of a bidder and its parent entities must be disclosed, even if there are ultimately no individuals with stock in those companies who meet the threshold.

Schlumberger, supra, does not suggest to the contrary. There, the plaintiff's bid had been rejected for failure to comply with the disclosure requirements of N.J.S.A. 52:25-24.2. Schlumberger, supra, 252 N.J. Super. at 204-05. We reversed on the ground that the plaintiff was wholly-owned by a public company with the same name in its title, and this fact was evidently known by the municipality that solicited the bids. Id. at 212-13. Thus, the plaintiff's statement after the bid that its parent company was the sole stockholder was considered a permissible clarification. Id. at 212. Pertinent here, however, we noted, that "if there had been undisclosed shareholders holding 10% or more of the stock or if the identity of even a public company had been purposely withheld, the bid might properly have been rejected." Ibid. (emphasis added). Our reference to a "public company" clearly implies that disclosure of a corporate entity is required even if it has no stockholders with a 10% or greater ownership interest.

Not only does the Director's interpretation comport with the plain meaning of N.J.S.A. 52:25-24.2, it also furthers the legislative purpose of full disclosure. In George Harms, supra, 161 N.J. Super. at 372, the court held that in enacting N.J.S.A. 52:25-24.2, the Legislature

expressed its clear purpose to ensure that all members of a governing body and the public be made aware of the real parties in interest with whom they are asked to contract. Thus the public, as well as public officials, can identify any real or potential conflicts of interest arising out of the awarding of public contracts, or can identify those bidders who lack the requisite responsibility.

[(Citing Assembly Bill 22 (1976), "Statement of Purpose.")]

In our view, the legislative purpose is served by disclosure of any corporate entities with a substantial ownership stake in the bidder. As the Director emphasized, identification of such entities would allow the DPP to verify compliance with the statutory requirement that individual 10% stockholders be identified.

II.

HFL argues, in the alternative, that the information provided in its bid "substantially complied" with N.J.S.A. 52:25-24.2, because it provided the ownership disclosure information it deems "essential," namely, that it is "owned by the LGC family of companies which in turn is owned by Bridgeport Capital." We disagree.

Courts have demanded strict compliance with the ownership disclosure requirements of N.J.S.A. 52:25-24.2. In George Harms, supra, the court noted "that any bid not containing such a statement [of ownership] would not be a valid bid" and "[t]here is no provision in the statute permitting [the contracting body] to waive the requirement of disclosure or to allow a bidder additional time following the acceptance of bids to cure an invalid bid." 161 N.J. Super. at 372-73. Strict compliance "serves to foster the public purpose of genuine competition on common terms." Id. at 375. We reiterated this rationale in Impac, Inc. v. City of Paterson, 178 N.J. Super. 195, 200-01 (App. Div.), certif. denied, 87 N.J. 414 (1981), wherein we upheld the rejection of a vendor's bid in part for failure to submit an accurate ownership statement, finding that this was necessary to "secur[e] equality in [public] bidding and avoid[] opportunities or the potential for favoritism, improvidence or corruption." See also Muirfield Constr. Co., Inc. v. Essex Cnty. Improvement Auth., 336 N.J. Super. 126, 137 (App. Div. 2000) (upholding rejection of bid containing inaccurate ownership information).

In Township of River Vale v. R.J. Longo Construction Co., 127 N.J. Super. 207, 216 (Law Div. 1974), the court applied two criteria

in determining whether a specific noncompliance constitutes a substantial and hence nonwaivable irregularity -- first, whether the effect of a waiver would be to deprive the municipality of its assurance that the contract will be entered into, performed and guaranteed according to its specified requirements, and second, whether it is of such a nature that its waiver would adversely affect competitive bidding by placing a bidder in a position of advantage over other bidders or by otherwise undermining the necessary common standard of competition.

The Supreme Court adopted this two-prong test for analyzing defective bids in Meadowbrook Carting Co. v. Borough of Island Heights, 138 N.J. 307, 315 (1994).

Here, HFL's bid deficiency was not merely technical but substantive. HFL did not make full disclosure of all layers of its ownership to the DPP and the information provided with its bid was incomplete and inconsistent. Its rather simplistic, vague reference to its ownership by a "family of companies" does not meet the statutory requirement that the names and addresses of all 10% owners of the bidding entity be disclosed, and if any of those owners are corporations or partnerships, that all 10% or greater owners of those entities be disclosed.

Schlumberger, supra, is distinguishable. In that case, a bidder who submitted deficient ownership information previously provided complete ownership disclosure to the contracting municipality during "extensive negotiations for both an earlier contract and [the contract at issue]." 252 N.J. Super. at 207. Because the vendor's ownership by a publicly traded corporation with no 10% or greater stockholders "may even have been well known to the municipality," the court found that the municipality should have accepted the bid. Id. at 211.

Here, unlike Schlumberger, HFL did not provide all of the required disclosure prior to or with submission of its bid. Moreover, HFL's true and complete makeup i.e., each layer of ownership until any and all individual 10% or greater owners are disclosed could not be determined from the face of the bid. And lastly, this requisite information had not previously been disclosed to the DPP.

HFL nevertheless argues that its post-bid ownership disclosure cured this deficiency. We disagree.

In the first place, "no material element of a bid may be provided after bids are opened." George Harms, supra, 137 N.J. at 37. While a bidder may properly be permitted to clarify or explain the contents of its proposal post-opening, supplying an essential missing item from a bid is not permissible. In re Protest of Award of On-Line Games, supra, 279 N.J. Super. at 597-98.

In George Harms, supra, the plaintiff could not correct its violation of N.J.S.A. 52:25-24.2 post-bid. The plaintiff, who was the apparent low bidder, failed to provide a list of 10% stockholders with its bid, but shortly thereafter submitted a document to the municipality to rectify this violation. 161 N.J. Super. at 369-70. The court found that any "material departure" from the terms of N.J.S.A. 52:25-24.2 "will invalidate both the nonconforming bid and any contract based upon it." Id. at 374. In other words, "where a party does not materially respond to the bid specifications he cannot be classified as a bidder at all, since the specifications are mandatory and jurisdictional." Ibid. As a consequence, "where an error is deemed material, it cannot be cured after the bids are opened." Id. at 376. The court explained how making such deficiencies incurable provides assurance to the government that the contract would be entered into and prevents bidders from gaining an unfair advantage: if the plaintiff had decided for whatever reason that it did not want the contract award, it could have simply refused to submit the stockholder statement, leaving the municipality with no choice but to reject its bid as noncompliant. Id. at 377. See also Muirfield, supra, 336 N.J. Super. at 134.

We distinguished the incurable bid defect in George Harms from an accurate but "unavoidably confusing" shareholders' statement in Stano v. Soldo Construction Co., 187 N.J. Super. 524, 539 (App. Div. 1983). In Stano, after the county that solicited bids requested clarification of the bidder's shareholder statement, the bidder submitted a letter stating that 100% of its stock was held by a corporation and named an individual who owned 70% of that corporation. Id. at 531. We read George Harms "to apply where there has been no submission of a proper statement at all." Stano, supra, 187 N.J. Super. at 539. In contrast, the bidder in Stano "had provided an accurate shareholders' statement, but due to the complexity of the facts it was unavoidably confusing. The later clarification was simply intended to aid the county in its interpretation of the statement and was permissible." Id. at 539.

Clarification also was permitted in Schlumberger, supra, where the plaintiff, whose bid was rejected for failure to answer the ownership disclosure question in the bidding specifications, was a wholly-owned subsidiary of another corporation, which was in turn wholly owned by a corporation traded on the New York Stock Exchange, and no individual owned at least 10% of the stock of any of the companies. 252 N.J. Super. at 204-06. In addition, as noted, the plaintiff claimed its ownership information had previously been supplied to the municipality soliciting bids during negotiations for both the contract at issue and an earlier contract and that the municipality "was well aware of its corporate structure and should have been aware of the fact that there were no individual stockholders owning in excess of 10% of [the plaintiff's] stock." Id. at 207. We found that, under such circumstances, plaintiff's after-the-fact clarification was permissible:

Since the bidder here was a corporation with the name "Schlumberger" in its title and apparently was known to the municipality as wholly-owned by the public company, should Schlumberger Industries, Inc. have been permitted to state after the bid by way of clarification of the bidding document, that Schlumberger, Ltd. was the sole stockholder? Would this have been more than a "clarification," heretofore recognized as permissible in Stano? No long-term process was necessary to effect a cure, if a defect in fact existed. The bidder immediately attempted to state the necessary facts. Of course, if there had been undisclosed shareholders holding 10% or more of the stock or if the identity of even a public company had been purposely withheld, the bid might properly have been rejected.

[Id. at 212 (internal citation omitted).]

We again distinguished George Harms, supra, "where the ownership clearly could not be determined from the face of the bid, and had not been previously disclosed to the municipality." Schlumberger, supra, 252 N.J. Super. at 212. We also emphasized that the "statute was not meant to cost public bodies many thousands of dollars by requiring acceptance of higher bids for mere technical violations." Ibid.

We revisited this distinction between facially valid and facially defective bids in Muirfield, supra, 336 N.J. Super. at 138, finding that the bidder's failure to disclose an individual's 10% ownership interest was a material and incurable defect. The bidder had originally represented that 100% of its stock was owned by one company, but after the bids were opened, clarified that the company actually owned 89% of the bidder's stock while another individual owned the remaining 11%. Id. at 130. Referring to Stano and Schlumberger, we stated that

[i]n those cases, the challenged bids were facially valid, with no apparent defects. Both bidders had submitted adequate and accurate disclosure forms which were supplemented to reveal additional facts. Here, [the bidder] submitted a bid and disclosure form which, on its face, was defective and disqualified the bid and the bidder.

[Id. at 137.]

The present matter is unlike Schlumberger, where the bidder had recently provided complete and accurate ownership information during extensive contract negotiations with the municipality; and the ultimate parent company that was initially omitted was publicly traded on the New York Stock Exchange and shared the same name with the bidder; and also unlike Stano, where the bidder had initially provided an accurate statement of ownership that needed clarification only because of its complexity and confusing nature. Here, HFL's bid information was both incorrect and incomplete, having failed to disclose several companies that wholly own other companies within its direct lineage.4 Moreover, this deficiency was not completely cured by HFL's post-bid documentation, which did not provide the addresses of all of HFL's parent companies in compliance with N.J.S.A. 52:25-24.2. We therefore conclude that HFL's bid was facially invalid and the defect in the ownership information provided was material and incurable through post-bid clarification.

III.

Lastly, HFL argues that the DPP's award of the contract to Truesdail was the result of favoritism in that DPP sua sponte disqualified HFL's bid, as Truesdail's March 8, 2012 protest did not allege that HFL failed to comply with N.J.S.A. 52:25-24.2 or seek to disqualify HFL's bid on that basis; accepted Truesdail's bid despite the fact that Truesdail failed to answer the questions on the ODF, creating a double-standard; and engaged in ex parte communications with Truesdail to ascertain that its answers submitted in a previous ODF were still accurate. Once again, we disagree.

In rejecting HFL's claim that DPP's declaration of HFL's proposal as nonresponsive showed bias against HFL or favoritism towards Truesdail, the Director stated that her

October 12, 2012 final agency decision clearly indicates that I rejected Truesdail's arguments in its protest regarding the substantive merits of HFL's proposal, and sustained the Committee's favorable conclusions as to HFL's qualifications. . . .

My subsequent determination that HFL's response to the identified discrepancy in its ownership disclosure constituted a substantive modification of the information in its proposal was soundly based upon application of relevant case law as set forth in my October 12, 2012 final agency decision. Moreover, full and complete ownership disclosure submitted prior to or with a proposal is expressly required by N.J.S.A. 52:25-24.2. The decision to reject HFL's proposal thus was based not on bias against HFL or toward [Truesdail], but on adherence to the fundamental principle that the public procurement laws, including those pertaining to ownership disclosure, must be applied fairly and equally to all. For this office to disregard a deficiency in a proposal regarding a statutory requirement simply because the issue was not discovered and addressed by the Committee or Procurement Bureau, or raised by [Truesdail] in its protest, as HLI has propounded, would be imprudent and irresponsible.

The Director rejected the argument that Truesdail's proposal should be deemed nonresponsive because of Truesdail's failure to answer the questions on the ODF:

[DPP's] standard practice concerning the responsiveness of a proposal includes a thorough review by [DPP's] Proposal Review Unit to ensure that the proposal contains all required standard forms, including the ODF. In the event a proposal contains no ODF or contains an incomplete ODF, [DPP] policy, procedure and practice is to determine if the bidder has filed an ODF form within the prior six months. This search is conducted because N.J.S.A. 52:25-24.2 expressly requires submission of complete ownership information prior to or accompanying a submitted proposal, and because [DPP] seeks to accept rather than disqualify proposals it has solicited.

The ODF [Truesdail] submitted with its proposal for the prior, failed procurement effort for the subject T2813 contract was fully completed. . . . This previously submitted ODF, signed and dated August 2, 2011, was deemed by the Proposal Review Unit to be complementary and curative of the unchecked questions contained in Truesdail's proposal for the current procurement. Finding this determination to be consistent with [the DPP's] standard policy, procedure and practice, and in light of Truesdail's subsequent affirmation of the continuing accuracy of the five "No" responses indicated on its prior ODF, I find that the absence of checkmarks to the right of the five questions posed on page two of the ODF submitted with [Truesdail's] proposal in response to RFP 12-X-22361, does not constitute cause to declare Truesdail's proposal non-responsive and ineligible for contract award.

Additionally, this office has in past final agency decisions concluded that the five questions at issue, though they are presented on page two of the ODF, are not part of or integral to the disclosure of ownership information required by N.J.S.A. 52:25-24.2, and thus an unclear or non-response to them is subject to remedy post-bid opening. . . . [T]he statute does not mention or require submission of information responsive to the five questions at issue here.

We are in accord with the Director's reasoning. We discern no impropriety in the Director having raised the issue of HFL's compliance with N.J.S.A. 52:25-24.2 sua sponte. On the contrary, DPP is charged with fulfilling its statutory duties, which includes ensuring compliance with N.J.S.A. 52:25-24.2. Having determined that HFL violated this provision, the Director properly treated HFL's bid as nonresponsive. Thus, the DPP's decision to carry out its legislative mandate cannot reasonably be characterized as favoritism. It is also worth reiterating that the DPP initially awarded the contract to HFL before any deficiencies in its bid proposal came to light, which militates against any claim that the DPP was biased against HFL.

Nor do we discern any other basis for HFL's claim of the appearance of favoritism. While Truesdail did not answer the five questions on the ODF submitted with its bid, Truesdail did answer the same questions for the prior failed procurement of the same contract approximately four months earlier, and confirmed to the DPP that its answers were still accurate. As the Director noted in her final agency decision, it is the DPP's standard policy to check its records to determine whether a bidder has submitted a completed ODF within the previous six months. This policy is consistent with the requirement of N.J.S.A. 52:25-24.2 that the bidder submit the required ownership information "prior to" or "accompanying" a submitted proposal. Moreover, the ODF stated that "[i]f this form has previously been submitted to the Purchase Bureau in connection with another bid, indicate changes, if any, where appropriate." Furthermore, in Schlumberger, supra, we allowed the bidder to clarify the ownership information submitted with its bid proposal in part because it had recently supplied the correct information to the municipality. 252 N.J. Super. at 207. And, no statutory provision requires answers to these five questions to be submitted with the bid. Rather, the information requested by the questionnaire has been "deem[ed] desirable" by DPP pursuant to N.J.S.A. 52:25-24.1. For all these reasons, we conclude that the DPP properly relied on the answers on Truesdail's previously submitted ODF.

Finally, we do not find that the DPP's ex parte communications with Truesdail, for the purpose of confirming that Truesdail's previous answers to the ODF questions were still accurate, created an appearance of favoritism. DPP also engaged in ex parte communications with HFL following Truesdail's protest, seeking clarification on the conflicting ownership information that HFL submitted. Therefore, there is no basis in the record for the claim that the parties were treated in an unequal or unfair manner.

Affirmed.

1 In accordance with the requirements of N.J.S.A. 52:25-24.2, the ODF instructed the bidder to provide the names, home addresses, dates of birth (not statutorily required), and ownership interest of all individuals or entities with a 10% or greater interest in the bidder, and the same information for the holders of 10% or more interest in those entities. In addition, the ODF contained the following five questions not mandated by the requirements of N.J.S.A. 52:25-24.2:

1. Within the past five years has another company or corporation had a 10% or greater interest in the firm identified above? (If yes, complete and attach a separate disclosure form reflecting previous ownership interests.)

2. Has any person or entity listed in this form or its attachments ever been arrested, charged, indicted or convicted in a criminal or disorderly persons matter by the State of New Jersey, any other State or the U.S. Government? (If yes, attach a detailed explanation for each instance.)

3. Has any person or entity listed in this form or its attachments ever been suspended, debarred or otherwise declared ineligible by any agency of government from bidding or contracting to provide services, labor, material, or supplies? (If yes, attach a detailed explanation for each instance.)

4. Are there now any criminal matters or debarment proceedings pending in which the firm and/or its officers and/or managers are involved? (If yes, attach a detailed explanation for each instance.)

5. Has any Federal, State or Local license, permit or other similar authorization, necessary to perform the work applied for herein and held or applied for by any person or entity listed in this form, been suspended or revoked, or been subject [sic] or any pending proceedings specifically seeking or litigating the issue of suspension or revocation? (If yes, attach a detailed explanation for each instance.)

2 Truesdail was the second lowest bidder. Each bidder was awarded a certain number of points by each member of a five-person evaluation committee, taking into account several factors, including personnel, experience, ability to successfully complete the work, testing procedures and cost. HFL automatically earned 750 points for submitting the lowest cost proposal, and Truesdail earned 600 points for submitting the second-lowest cost proposal. Truesdail earned 3,790 points on the remaining technical criteria, for a total score of 4,390, and while HFL earned fewer points (3,680) on the technical criteria, it had the highest total score of 4,430.

3 HFL bases this interpretation on the provision stating that ownership disclosure must continue "until names and addresses of every noncorporate stockholder" having 10% or greater ownership have been provided.

4 HFL's letter and chart submitted for clarification after the bids were opened provided ownership information that was absent or that conflicted with the information in the bid proposal. It showed that HFL was immediately owned by HFL Sport Science, Ltd., which conflicted with a chart in the proposal that indicated HFL Sports Science, Ltd. was a sister company of HFL. Moreover, five additional tiers of ownership were shown between HFL Sport Science, Ltd. and LGC Science Holdings, Ltd., the parent company identified in the proposal. And the chart indicates that LGC Science Holdings, Ltd. is owned by Teddington 2 Limited, which is in turn owned by LGC Science Group, Ltd.