Drennan v. Star Paving Co.

Notable Items:

Issue(s) Before the Court:

Appellant's Claim(s):

Respondent's Claim(s):

Holding(s) and Disposition:

Material Facts:

• July 28th, 1955, plaintiff (general contractor), was preparing a bid for the "Monte Vista School Job" in the Lancaster county school district.
• Plaintiff's employee received telephone call from Kenneth R Hoon, claiming to be acting on behalf of defendant, submitted bid of $7,131.60.
• Bid was recorded among the others and found to be the lowest for that portion of the job.
• Plaintiff was awarded the contract.
• Next day, defendant stated that they made and error in their bid communicated to plaintiff, and refused to honor their bid unless paid $15,000.
• Plaintiff informed defendant that defendant must honor their bid to the general contractor. Just as plaintiff had to honor his bid to the county.
• Plaintiff engaged L & H Paving to perform the work committed to by defendant for $10,948.60
• Trial Court found that defendant made a definite offer which was accepted by the plaintiff and awarded the plaintiff the difference in amounts ($3,817.00).
• A full recounting of the facts is available below

Procedural History:

Rationale

Majority Opinion

• [1] Section 90 of the Restatement of Contracts: "A promise ... reasonably expect to induce action or forbearance ... and which does induce such action or forbearance is binding if injustice can be avoided only by enforcement of the promise."
• [2] Defendant's offer constituted a promise to perform on such conditions as were stated expressly or by implication therein....
• Defendant was silent on recovation till after plaintiff's bid was accepted by the county.
• [3] "Reasonable reliance ... affords a compelling basis ... not to revoke an offer for a bilateral contract."
• [4] "The absence of consideration is not fatal to the enforcement of such a promise."
• [5] "... defendant submitted its bid to obtain the subcontract."
• [6] general contractor in no position to reopen bidding or delay in hope of a better price.
• [7] plaintiff had no way of knowing that the bid was in error, as the bid was within the 160% range usual for the area.
• [8] "... the loss resulting from the mistake should fall on the party that caused it."
• [9] "... no merit to defendant's contention that plaintiff failed to state a cause of action, ...."
• [10] uncertainty in plaintiff's allegation as to damages could have been raised by special demurrer. It was not so raised and is therefore waived."

Full Recounting of Facts

• July 28th, 1955, plaintiff (general contractor), was preparing a bid for the "Monte Vista School Job" in the Lancaster county school district.
• Bids to be submitted by 8pm.
• Subcontractors submit their bids to general by phone on day due to submit final bid.
• Plaintiff's employee received telephone call from Kenneth R Hoon, claiming to be acting on behalf of defendant, submitted bid of $7,131.60.
• Bid was recorded among the others and found to be the lowest for that portion of the job.
• Plaintiff was awarded the contract.
• Next day, defendant stated that they made and error in their bid communicated to plaintiff, and refused to honor their bid unless paid $15,000.
• Plaintiff informed defendant that defendant must honor their bid to the general contractor. Just as plaintiff had to honor his bid to the county.
• Plaintiff engaged L & H Paving to perform the work committed to by defendant for $10,948.60
• Trial Court found that defendant made a definite offer which was accepted by the plaintiff and awarded the plaintiff the difference in amounts ($3,817.00).
• Defendant claims no valid contract.
• A list of the material facts is available above