OHIO SUPREME COURT RULES IN FAVOR

OF THE CITY OF CINCINNATI

By Thomas R. Yocum, Esq.

            In the case of Cleveland Construction, Inc., v. City of Cincinnati, 118 Ohio St. 3d, 283 decided on May 21, 2008, the Ohio Supreme Court ruled in favor of the City of Cincinnati and against Cleveland Construction Company, Inc.’s challenge as an unsuccessful bidder on a drywall contract for the convention center expansion. 

            The drywall contract was awarded to another bidder, even though Cleveland Construction submitted the lowest bid.  However, the bid package provided that the contract would be awarded to the “lowest and best bidder”.  The Court held that given the extensive discretion of the City in considering bids, Cleveland Construction had no property right in the drywall contract at issue in the case.  No property interest is created when a City properly exercises its discretion and does not award a contract to a party deemed not to have complied with the requirements of the invitation to bid.

            The City of Cincinnati retains broad discretion to “reject any bid for any reason or all bids for no reason at all if acceptance of the lowest and the best bid is not in the best interest of the City”. 

            Cleveland Construction had not complied with the Small Business Enterprise provisions in the bidding documents, and the City awarded the contract to the next lowest bidder who did comply with the SBE requirements. 

            The Court held that the City of Cincinnati did not abuse its discretion in awarding the contract to the next lowest bidder who did comply with the SBE requirements, and that Cleveland Construction had not acquired any property interest in the contract.

            The Court rendered judgment in favor of Cincinnati, and against Cleveland Construction.  This case was litigated over a period of several years at considerable expense, and demonstrates the difficulty of “challenging City Hall” in contesting public contract awards.