The case involves Ralph Hodge Construction Company (Plaintiff) appealing a summary judgment against Brunswick Regional Water and Sewer H2GO (Defendant) regarding the recovery of a security deposit after the Plaintiff attempted to withdraw its bid for a government contract. The Defendant, a government agency, solicited bids for constructing a public water supply and treatment system, requiring bidders to submit a security deposit of 5% of their bid. The Plaintiff submitted a bid of $5,084,832, along with a deposit of $254,241.62, and was the lowest bidder by nearly $900,000.
On July 16, 2020, the bids were opened, but the Plaintiff's request to withdraw its bid and seek a refund of the deposit was made on July 24, 2020, exceeding the statutory limit of 72 hours for such requests under N.C. Gen. Stat. 143-129.1. The Defendant denied the request due to its untimeliness, prompting the Plaintiff to seek a declaratory judgment on its rights regarding the bid withdrawal. Both parties filed for summary judgment, and the trial court ruled in favor of the Defendant, leading to the Plaintiff's appeal.
The Court of Appeals reviewed the trial court's summary judgment order de novo, affirming that the Plaintiff's deposit was forfeited due to the late withdrawal request. The court highlighted that the purpose of N.C. Gen. Stat. 143-129 is to ensure transparency and competition in public contract bidding, requiring at least three competitive bids for the contract award.
Section 143-129 mandates that bids must meet specific criteria, including a 5% deposit of the bid amount, sealing during submission, and being opened collectively at a designated time. The awarding entity must review all bids post-opening and award the contract to the lowest responsible bidder, considering factors such as quality and performance. A successful bidder forfeits the deposit if they fail to sign the contract within 10 days, while unsuccessful bidders receive their deposits back. Bidders can typically withdraw their bids before the opening without penalty. Post-1977, under N.C. Gen. Stat. 143-129.1, a bidder may withdraw their bid after it has been opened, but forfeits their deposit unless specific conditions are met, as outlined in the statute. The statute allows for withdrawal without forfeiture only if the public agency agrees, and if denied, it is treated as if the bidder refused an award. Thus, a bidder loses their deposit upon withdrawal, regardless of their potential success in the bidding process, as the statute explicitly states that withdrawal without right results in forfeiture of the security.
Plaintiff's interpretation of statutory language is incorrect; it does not prohibit a bidder from withdrawing a bid before acceptance after 72 hours. The relevant statute indicates that while a bidder cannot claim a refund of the deposit if withdrawal occurs after 72 hours, it does not bar the agency from hearing a late withdrawal request. The statute mandates that an agency must hold a hearing if a withdrawal request is filed. In this case, Plaintiff was permitted to withdraw its bid before the contract was awarded but failed to comply with Section 143-129.1's requirements. Consequently, Judge Shirley's ruling granting Defendant summary judgment is affirmed, with Judges HAMPSON and WOOD concurring.
