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Contracts Keyed to Fuller
Pavel Enterprises, Inc. v. A. S. Johnson Company, Inc.
Citation:
342 Md. 143, 674 A.2d 521 (1996)Facts
The National Institutes of Health solicited bids for a renovation project on its Bethesda campus. Pavel Enterprises, Inc. (PEI) prepared a bid and solicited sub-bids from various mechanical subcontractors. A.S. Johnson Company submitted a written scope of work proposal on July 27, 1993, and verbally quoted $898,000 for the HVAC component on August 5, 1993. PEI incorporated Johnson’s sub-bid into its own bid of $1,585,000. PEI was initially the second-lowest bidder, but NIH disqualified the apparent low bidder and notified PEI in mid-August that its bid would be accepted. On August 26, PEI’s president visited Johnson’s offices to discuss their role in the project. That same day, PEI sent a fax to all mechanical subcontractors requesting they review their bids. On September 1, PEI formally accepted Johnson’s bid by letter. Johnson immediately called to withdraw its bid, claiming an error, and confirmed this withdrawal in writing on September 2. NIH formally awarded the contract to PEI on September 28. PEI found a substitute subcontractor at a cost of $930,000 and sued Johnson for the $32,000 difference.
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