Dobco, Inc. v. Bergen County Improvement AuthorityAnnotate this Case
The Bergen County Improvement Authority (BCIA) issued a request for qualification (RFQ) for a redeveloper to act as general contractor in the rehabilitation of the Bergen County Courthouse. Nine companies, including plaintiff Dobco, Inc., submitted proposals in response to the RFQ. The BCIA notified four firms that they were selected to proceed, and it notified Dobco and the other firms not selected for the short list. Dobco and plaintiff Hossam Ibrahim, the vice president and a shareholder of Dobco, and a resident and taxpayer of Bergen County, immediately filed separate, but essentially identical, complaints alleging that defendants’ actions violated the Local Public Contracts Law (LPCL) and were arbitrary and capricious. The trial court dismissed plaintiffs’ complaints with prejudice for failure to state a claim, concluding that the project was “not subject to the LPCL because it has been designated a redevelopment project” under the Local Redevelopment and Housing Law (LRHL). The judge determined that plaintiffs were barred from seeking equitable relief because Dobco responded to the RFQ and Ibrahim had not challenged the procurement process or the RFQ prior to filing his complaint. The Appellate Division affirmed the dismissal of Dobco’s complaint, finding “that Dobco is estopped from now complaining that a process in which it willingly participated violated the law.” The Appellate Division, however, reversed as to Ibrahim, determining that he could proceed with his suit as a taxpayer and remanding to the trial court to enter an order permanently restraining the BCIA from proceeding with the procurement process contemplated by the RFQ. The New Jersey Supreme Court affirmed the Appellate Division substantially for the reasons expressed the appellate court's opinion. The Court required that, going forward, a plaintiff claiming taxpayer standing in an action challenging the process used to award a public contract for goods or services had to file a certification with the complaint. As to the merits of this appeal, the Court departed from the Appellate Division’s decision in only one respect: the Court did not rely on the leasing and financing arrangements contemplated by the BCIA and defendant County of Bergen.