:MIDDLESEX, SS ..

.JOHNSON TURF AND GOLF MANAGEMENT, INC.,· Plaintiff
V..

CITY OF BEVERLY, Louis D. Bennett, Jack L. ..Altshuler, Dennis P. Crimmins, Patricia B. Grimes, John D. Kenney, Daniel E. Klemis, Betty Murphy, Elimbcth Mmphy, Arthur Orecchia, James J. O'leary, William A. Walo and Natalie Fiore in their capacity as members of the Beverly Golf and Tennis Commission, and the BEVERLY GOLF AND TENNIS COMMISSION, Defendants . FINDINGS OF FACT

......

AND CONCLUSIONS

OF LAW

.

..

FINDINGS OF FACT 1. In the fall of 1996 the City of Beverly published, under the provisions of G.L. Ch. 30B, a request for prop9sal (RFP) to operate the Beverly Golf and Tennis Club (BGTC) for a. S year period, with an option to·extend for an additionalS years being retained by the City. This undertaking was negated for procedural irregularities and sll1)sequen11y in the face ofresistanee from the appointing authority, City Purchasing Agent Bradley, the BGTC Commission members insisted the bids be opened and madepublie. a. Beverly is engaged in trade and commerce within the meaning of G.L. Ch. 93A through its ownership and operation of the BOTC. More than half of the members of the ;SOTe are non-residents of Beverly . Mayor Scanlon viewed the BOTC as a profit making venture and money making financial investment, He wanted to maximize revenue and financial remmfrom the BOTe operation and 'wanted to make money on the BOTe. The defendants consider the BOTe a "semi private club'; am:\:described the BOTC as such in the RFP. Mayor Scanlon and the Chief Assessor. for the City recognized that the aOTC property was not . tax-exempt because it is "used in connection with a business conducted for profit" and that the BOTC property is leased and is used "for other than public purposes." During trial, the witnesses for the Defendants characterized the BOTe as a . financial enterprise designed to make money for Bevedy,

. . .' -: -r~:;" - ....._-, -- _..

b. c. d.

The Defendants' conduct as described elsewhere in these findings of fact was intentional, willful and knowing.
The Defendants' conduct as described elsewhere in these findings of fact was . ..unfair and deceptive.

. The RFP and Johnson's response to the RFP formed an implied contract. The . Defendants' conduct was in disregard of this known contractual arrangement and . was therefore unfair and deceptive.· . . Although the burden is on the defendants to show that they are exempted from the provisions and reach of G.L. Ch. 93A, the defendants offered no evidence in this .regard ..

e.

. 2.

At the time, the authority to award eo*traets in excess of510,000 had been delegated to Bradley. by the Mayor of Beverly in accordance with the pr.ovisions of the City Charter and had been rued with the OtDce of the Inspector General . acco~g toa statutory· requirement.
a.. . By

written delegation the Mayor delegated his authority as Chief Procurement Qfficer ("CPOj to the Purchasing Agent Bradley. .

b. .

The Mayor never revoked the written delegation of authority to Bradley in any way, including by the method set forth in the regulations of the' Inspector General.

Specifically. the Mayor never revoked Bradley's authority to act as CPO for golf course bid and there is no written document revoking Bradley' s authority to act as CPO for golf course bid. . ~.~ .~ ~ . .. -'.' t-.
i

c.

Mayor Scanlon was aware that in order to revoke the delegation of authority he must file a written instrument with the office of the Inspector Oeneral. Mayor Scanlon did not give himself the right to procurement such as the one . involving the BGTC. To the contrary, Mayor Scanlon's delegation of authority to himself as Executive was limited to bids less than $10,000 in size.

d.

3.

In the fall of 1997 a second RFP was published. On this occasion only the plaintiff and incumbent bid. A third bidder wu eliminated due to its failure ~ comply with the bond requireme~ts. Bradley remained respoDlible for the contract award. Plaintiff outbid Friel by SSSO,OOO despite the fact that Friel had been made aware of the first bid made by pbUntiff due to publication of the prior bids. AS a result of ,- '. irregularities in the bid procedure, tending to suPP()rt the conclusion that the Commission memben had impermissibly downgraded the plaintiff under the· bidding standards, the Superior· Court enjoined the award of the contract to Friel·· and ordered the matter rebid for the 3rd time.· .. -.

a

The South ShoreCountryClub ("SSCCj in Hingb~ Massachusettsis operated by Johnson and is a comparable facility to the BOTC. Both the SSCC and BOTe .have an 18 hole golf course, restaurant, snack bar, banquet facilities, driving range, pro shop, clubhouse, pool and tennis courts .: The Commission members
2

failed

to contact any representative of the management committee at the SSCC during the Second RFP. .

b.

One Commissioner testified that in order to remove Friel as the operator of BOTC, "it was like a championship fight, someone had to come in and knockout Friel, the champ." The Commissioner admitted that it was insufficient for a bidder to be equal to Friel qualitatively, he felt that in order to replace Friel the . new bidder would-have to be able to do a far better job than Friel. Despite having been told by Treasurer Dunn that Johnson was financially qualified, this same Commissioner gave Johnson an advantageous financial rating in the Second RFP instead of the appropriate highly advantageous rating.
was better than Johnson but they had been doing the job [at the BGTC] ...for ten

c.

The Chairman of the Commission admitted he did not know necessarily if [Friel]

.Years ... [and] ... ifit ain't broke, don't

fix it He essenti811y admitted to intentionally· violating GL. Ch. 30B when he acknowledged that he had ~ " ..•there was no reason to take someone that you had worked with for ten years and just because it has to go out to bid by virtue of statute that you're going to kick the guy out. All things being equal. Why get rid of the guy?" Another Commissioner did not give Johnson a highly advantageous financial rating despite Treasurer Dunn's report and admitted he does not know why he only gave an advantageous rating. He declined to give Johnson an advantageous rating in the area ofmsnaging an 18 hole golf course even though he should have .done so based on the.RFP and Johnson's response. In area of experience in managing clay tennis courts, he downgraded Johnson because he felt its experience wasn't "recent" enough even though the RFP did not require the experience to be "recent", Based on the RFP and Johnson'a'proposal, the Commissioner admitted that he should have given Johnson a highly advantageous rating.
. .

. d.

the

e.
4.

In the Second RFP, both Treasurer Dunn and Purchasing Agent Bradley thought . .Johnson should get the Contract.

Three companies filed bids on the 3n1 RFP, the incumbent Friel, plaintHr Johnson and Arnold Palmer Co. The bids were again for a 5 year contract with an option in the City to extend it an additional 5 yean (in effect a 10 year term). The City Treasurer (Dunn) reported. plaintiff "creditworthy of performing under the contract". and financially capable .

5.

6.

Having found plaintiff, at the time of his interview for the second Request for .Proposals, to have performed well, in a classic example of petulance ·born, it would appear, offrustratioD from not being able to easily thiS selection, members of the Commission at the time of the third interview became confrontational with JohmoD. Bradley (still legally and ostensibly the awarding authority), auxioWJ to save the process from having to go to a fourth RFP intervened when Commission members raised their voices and began to question Johnson In relation to the.suit he had instituted to preserve bis rights unde.r the bid process.

.,eer

3

a.

The Office of Inspector General had informed the defendants that all bidders must be told how the would be evaluated at the interview. Nonetheless, the defendants did not establish any criteria by which prospective bidders would be judged , during the interview process for either the Second RFP or Third RFP except to tell the bidders that the interview was optional. During the interviews for the Second RFP, Johnson and Friel's performances' ·were "about equal" with one Commission member acknowledging that Johnson's "presentation was very well done" and was "great," Despite being qualified, . doing a "great" job on the presentation and offering $550,000 more than the ·incumbent Friel, the Defendants wrongfully selected Friel. . On June 23, 1998'dwing the interview for the Third RFP; Johnson acted . ·appropriately and did a good job. During the Third RFP interview, Johnson spoke . in a soft quiet voice. There are no notes or records of the Commission which indicate that Johnson was oonfroritation81 or tlult Johnson failed to answer any question! His demeanor during the interview for the Third RFP was professional. ·He expressed a desire to work with the Commission, Sometime after the interview for the ThlrdRFP, during a telephone conversation: Bradley thanked Johnson for the way handled himself during the interview . . Bradley said that Johnson had "acted very professional under the circumstances of the way the Commission had acted •.n During the ThinlRFP interview, Johnson maintained control and acted professionally even though Commission members acted in a Confrontational manner. Bradley told Johnson that the Commission was looking for a reason not to hire him and stated words to the effect IIthey are looking for a way to dump you".

b.

c.

d.

he

e.

toward Johnson and asked confrontational questions. One Commissioner was asked "And you berated Johnson Golf and attacked Johnson Golf, did you not?" and the Commissioner answered "Yes," Another Commissioner admitted that . Commissioner's questions were "somewhat confrontational" and did not-set a -. great tone .. That same Commissioner admitted tluit he was so loud and obnoxious . that the Chairman of the Commission had to elbow and nudgehim to avoid having to gavel him as out of order. He admitted that he "did get a little heated" during the interview. The same Commissioner wrote some notes during the . interview stating "what are we going to dolhow to proceed ..what becomes public record." That Commissioner, a lawyer with an Ivy League education, . acknowledged that when representing clients he keeps detailed notes: However, he adniitted "I was bothered by the exchange and as a result, didn't want to write
an:ything"• .

. During the interview for the Third RFP, Commission members raised their voices

f.

Just after the interview, the same Commissioner confronted Johnson in the hallway and said "some people ~y have had an agenda .•some people inay have had an agenda before this, I didn't, but I do now," .

4

g.

Commission members raised their voices toward Johnson to the point that he had them. not to yell at him, asked .inappropriate questions and the Commission's Chainnan had to "gavelO the meeting to order and [tell] the . members to focus on the questions that. ..pertain[ ed] to the RFP." .
to ask

h,

Another Commissioner testified that: the conduct of at least two Commission members was " ..•a little confrontational or certainly questionable," No minutes were kept for the meeting in which Johnson was interviewed. The official minutes of the Commission's meeting on June 30, 1998 (one week after . Johnson's interview) do not contain any reference to any inappropriate or confrontational conduct on the part of Johnson.

i.

. 7. .

Once more, in an extraordinary expression ·ofconfidence in· action to be taIWn .by the appointing authority, Friel underbid the plaintiff by $372,000 and was, in Cact,the lowest of the three bidden. In addition, the third RFP had issued under conditions clearly designed to improve the lot of the incumbent by limiting the field of bidders and creating an advantage to Friel wherever possible. For example, a totally unnecessary bo"_drequirement was imposed,. bidders were denied fertilizer . reeerds of tlle incumbent operator, prohibited from contacting the employees of the . ·incumbent nperator, misinformed as to reimbursement for "complimentary greens . fees" (a fad known only to the incumbent operator), Umited in ~e opportunity to ·.inspectthe BGTC p~operty and finally, given an unr~asonably limited time· in which to bid. . a. Mayor Scanlon admitted that the financial bid by Johnson was "far superior"to the bids submitted by Friel. In, the Third RFP, Johnson bid a total of$3,000.000, and Friel bid $2,628,000. More thantwo months after the order ofthC Court to rebid the Contract, on or . about April 16, 1998, Beverly published a third RFP ("Third RFP''). Given that the RFP had alreadybeen published twice and was required to be substantially the .same under the order of the Court, the inexplicable delay created an extremely 'tight time under the RFP, and had the practical effect of limiting competition.

the

h.

me

c.

. . April 23 , 1998, at the same time scheduled for the pre-bid conference. Bidders were instructed in the RFP not to have any contact with the incumbent operator of . ....the BOTe or its employees in preparing the bids. One Commissioner admitted . that the Commission did not want prospective bidders contacting Friel or its employees, d. . Another Commissioner admitted that only Friel knew that the "complimentary greens fees" were, in fact, not complimentary and that the operator would be paid for those greens fees. ...
5

By the terms of the RFP, bidders were given one opportunity to view the BOTe . in preparing their bids, That one opportunity was to take place at 6:00 p.m, on

e.

The RFP was published April 16, 1998 and required proposals to be submitted on April 30, 1998, which effectively gave bidders less than two weeks to become aware of the RFP and submit bids, especially in light of the fact that Beverly's City Hall closed at 1:00 p.m. on April 17 and was closed on April 20. ACcording to the Inspector General, "[s]horter periods oftime may favor a vendor who has held the contract in the past, or simply eliminate potential competitors." In the First RFP, the defendants did not require bidders to post a bond and more than six companies bid on the work. In the Second RFP and Third RFP, the

f.

defendants required a bond for 100% of the Contract value and only two companies submitted bids in the Second RFP and three companies submitted bids in the Third RFP. The bond was unnecessary. The defendants were protected by the stream of income from greens fees, cart fees, food and beverage receipts and permit holder fees and the ability to "change operators based on nonperformance. U The bond was unusual and is not needed or used in Boston for this type of contract. The bond was exclusionary .and "clearly restricted . competition." Even Mayor Scanlon admitted/that the Defendants required a bond to reduce competition. At triaI Mayor Scanlon was asked "one of the things that . your City did to· reduce competition for this contract was adding the bonding requirement from the first RFP to the Second RFP, correct?' to which Mayor Scanlon answered "Yes." For the last fifteen months, Beverly has been operating the BOTC without a written contract and does not have a performance bond in place. Because there is no performance bond, Friel is receiving a windfall of approximately $17-20tOOOper year (the cost of a bond). g. Friel refused to provide Beverly with course fertilizer and chemical application records. The Defendants made no attempt to force Friel to provide fertilization records. Prospective bidders and the City's taxpayers may have benefitted from having course fertilizer and chemical application records.

8.
.9.

At a prebid conference attended by the bidders, in a callous disregard for propriety, a representative of the incumbent operator sat with the Comm~sion members •
Within the hearing of a disinterested Beverly resident, a potential bidder described the enterprise as a "bag job" as a result of the bidder excluding bond requirements which would, incidentally t result in the bond cost 517,000 - $10,000 being passed ultimately to the City of Beverly.

of

10~

Jeffrey Conley, Executive Director of Boston Finance Commission, (a watch dog agency for the City of Boston in regard to its public contracts) was present at the bid .conference for the third RFP. Conlcly lived in Beverly and had followed the proceedings ~arefuny from the outset. His testimony was credible and very persuasive. In Conley's words, the Commission "got too· close to a vendor and they failed to pay attention to the law". In Conley's opinion the Commission was happy with Friel and "despite what the law was going to be they weren't going to change". Conley also opined that the Mayor (who ultimately usurped the authority of Bradley and made the award to Friel) "either had not done an independent evaluation of this [the bids submitted) or bad done a faulty one". The evidence further supports the conclusion that on two occasions Conley warned the Mayor that the Commis~ion

was DOtproperly evaluating Johnson. Conley reported that two potential bidders at the prebid conference complained they would be excluded from bidding by what Conley described at the totally unnecessary bon~ requirement.
8.

Conley's work includes reviewing the contracts made by Boston pursuant toG L: · Ch. 30B. Over the years, Conley has reviewed "thousands" of contracts procured pursuant to O.L.Ch. 30B, including contracts covering Boston's two public golf courses (Franklin Park and George Wright).
On or about July 14, 1998, Conley put Mayor Scanlon on notice in writing that the Commission was not properly evaluating Johnson. Conley also told Mayor Scanlon in person on two occasions (once following a city council meeting and once after another meeting) that the Commission was not properly evaluating Johnson, that.the Commission had made several errors in the review of the proposals submitted based on the RFP, "had done a poor job" evaluating Johnson .. and that Johnson was "clearly a 'qualified company and for anybody to say ·different was false, and that the actions of the Commission were not in the best -. interest of'the city of Beverly". Mayor Scanlon was also advised by Conley that many Commission members did not comply with the evaluatory criteria. During the conversation with Mayor Scanlon in the Mayor's office after the city council meeting, Conley told the Mayor that the Commission was not treating Johnson fairly, that "the process was sigmncantly flawed and there was more than enough · timeto do the right thing by the taxpayer." Mayor Scanlon admitted he was also · aware of a letter written by Conley to a local newspaper in which Conley stated .that Commission members had tainted the process by unilaterally downgrading . Johnson's qualifications. Conley expressed his opinion to Mayor Scanlon that the. Commission "[got] too close to a vendor and they fail[ed] to pay attention to the law.· 308 is very specific. This Commission Was definitely biased towards the . Friel Company." Conley also informed Mayor .Scanlon that the Commission was not objective in conducting the bid.process.

b.

11.

~ination

of the Commission members dJsclosed clearly that there was no eonce~able set of circumstances under which the plaintiff or Palmer eouId have prevailed· in the bidding.

a.

One of the motivations to keep Fnel was to conceal the "no bid" contracts that ·were the practice of the Commission. . In order to insure that Friel got the contract, · the Commission agreed to increase fees at the BOTC, split increases with Friel and conceal the arrangement from other bidders by stating in the RFP that fee increases were going to the City.· The City has illegally delayed signing the contract because it is conscious of its wrongful conduct and in a bold attempt to .avoid committing to a written instrument a private agreement with Friel that is . contrary to the requirements' of the RFP. . .
The RFP required the City to execute the Contract within 45 days of award but failed to do so and has allowed Friel to operate the BOTe without a contract for more than 15 months in violation of state law (G.L. Ch. 30B" § 17) under terms and conditions that include fee increases contrary to the requirements of the Third

. b.

RFP.

...

7

Co

Despite having made a determination to award the Contract to Friel on July 30, 1998, Mayor Scanlon reluctantly admitted. that over a year and a half later, the Mayor and Beverly had not yet signed a contract for the operation of the BOTC even though he knew it was it violation of the RFP, the regulations of the Inspector General and OoL. Ch. 30B' §170

d.Mayor Scanlon and one Commission member gave inconsistent reasons for the failure of the Defendants t9 execute the lease (the Commissioner said negotiations .are on going and Mayor Scanlon claimed he declined to do so on advice of counsel). The Commissioner's suggestion' of extensive negotiations on the terms ·of the contract (capital improvements, disposition of increases in fees and location offunds) violates the mandates of the Inspector General who has 'said "you may · not change the terms and conditions of the contract,"
e. . f. . .g. . Mayor Scanlon is aware that Friel has been late in making payments to Beverly. There are no other contracts in Beverly of the size involved in the operation of the

.BOTC ($3,000,000) in which Beverly operates without a written contract .
The defendants anticipated increasing the various fees and charge to the public for use of the BOTC. Friel expected that increases in fees would take place in the future and that Friel would share in those fee increases. The Commission raised

· fees each year and split fee increasea with Friel. . h.

. The defendants informed bidders that all increases in fees would be-the property . .of the defendants and not the operator of the BOTC. This language in the RFP was added between the Second RFP and the Third RFP. This language was added at the request of the Commission even though the Commission knew it was going to raise fees. The Defendants made this change to discourage competitive pricing in the bid knowing all along that, in fact, the Defendants expected to increase fees and share those increases with Friel. Friel was aware of the plan to share fees, all to the detriment of other bidders.
A commissioner testified that rate increases under the new contract are going to

i. '

be split between Beverly and Friel.

j.
k.

Historically, the defendants allowed Friel to undertake capital improvements and then be paid for the improvements in the form. of "rent credits".
As recently as 1999, Beverly paid Friel $92,210.37 for capital improvements and there are no records in the Defendants' possession evidencing compliance with the public bid laws for those improvements or the approximately $453,000 in capital improvements that several witnesses admitted took place during the last ten years ..

-.

8

. 1.

The desire to both continue and conceal the history of "no bid" contracts with . Friel also formed the basis for one of the Defendants' improper motives in . downgrading Johnson and upgrading Friel to assure that the Contract was awarded to Friel. .

12.

Under the standards set forth in the three RFP'. plaintiffwu regularly downgraded and Friel upgraded uncol18cionably. There were instances wherein Commission members imposed. their oWn penonal criteria to guide them in their choiceS, differing markedly from the published standards -. One member actually admitted [her] rating system was "probably Oawec.l". .

a.

Comparing the published criteria to the proposals submitted by Johnson, Palmer and Friel, it is clear that Johnson's proposal deserved a highly advantageous rating in every area of the evalutory criteria, deserved a highly advantageous composite rating and is qualitatively superior to the proposals submitted by· Palmer and Friel. .

b.

were often evasive when responding to questions about the evaluation of the
bidders and the failure of bidders to meet the minimum criteria. .

During the trial, the Mayor and the.Commission members were not candid and

13..

WhUe all Commission memben essentially agreed that the plaintiflwas qualifiedto perform the contract, another·frankly admitted that no level of qualifications or money provided by the plaintiff would eausehha to replace ~e incumbent operator, " •••ts like Ui, they were the champions. (Friel) There were people outside that i wanted to take it but they ~dn 't have enough, In my opinion, they didn't have enough to knock them out of the box". .

.a.

At trial, the Chairman of the Commission was asked "It didn't matter if there was . anyone better because you testified yesterday that no amount of qualification or money would change your position [that Friel should get the contract], right? To which the Chairman replied "That's right. tt
During July·13 Commission Meeting, the Commission members essentially agreed that Johnson.was qualified to do the work and able to. perform the work

b.

specified in each of the three golf course RFPs issued by Beverly. Mayor Scanlon admitted that Johnson Golfwas.qualified and capable of performing the work required under the RFP. Mayor Scanlon admitted that based upon the evaluation criteria set forth in the Third RFP. Johnson- deserved an overall rating of highly advantageous. Johnson was first in price and Friel was "dead last" in price. Based upon the requirements set forth in the Third RFP, Johnson deserved a higher rating qualitatively than Friel. .
In Purchasing Agent Bradley's opinion, Johnson was qualified to do the work set forth in.the RFPs.

c. d.

One Commissioner admitted that Johnson could do the same job as Friel and there was no issue "as to Johnson's ability." The Commissioner testified uMr. Johnson was as capable as Mr. Friel of doing the job", that Johnson has a good reputation
9

and that he received lots of very positive recommendations regarding Johnson. ~inally, this Commissioner's personal examination of a course operated by .". Johnson, SSCC, led him to believe that Johnson was qualified to maintain a golf . course. e.·
.f. - . grower in New England."

. Members of the Commission were informed that Johnson was the "tbe best grass ._ Members of the Commission were informed that Johnson did an "absolutely incrediblejob with [the Pine Brook] golf course. Commission members were informed by references that Johnson was so good at growing grass that if Doug Johnson had the desire to do -it he could grow grass on a billiard ball.

g.

Another Commissioner admitted that all the bidders were excellent and that they were all qualified. This COmmissioner was awar¢ that Sky Meadow, a .. managed by Johnson.was voted by GolfDig~ (a well respected national goJf magazine) as the mimber one public golf course in New Hampshire, the location . of the majority of Friel's courses. Similarly, another Commissioner admitted he was aware of the fact that a Johnson maintained course bad received such an award from Golf Digest Which he agreed is one of the "Bibles" of golf.

-'

.

course

h.

Another Commissioner stated that both Frieland Johnson "were competent. ..and I .don't think there was a great disparity between the two." .This Commissioner made two visits to the South Shore Country Club during the Second RFP and thought South Shore Country Club was a "lovely course, it looked cared for ...the .-eourse looked fine ...the grounds and everything looked fine." The Commissioner stated " ...where they did the catering was lovely. in fact I had expressed the fact that I had been to the dining room and it was very well done and the food was excellent..," .The Commissioner also spoke with. another owner of a course that Johnson rail. and was told that the course. was makingmonrmoney-andihatihlr ........ -greens were "excellent", . . One Commissioner admitted that Johnson hadvan excellent reputation as a greenskeeper." Johnson's proposal and testimony developed by the City Solicitor at trial - demonstrated that Johnson -iseminently qualified to do the work called for in the RFP. Mr. Johnson received a bachelor of science degree from the Plant Science and-Turf Grass Management program at the University of Massachusetts at ·Amherst. The Golf Course Superintendent's Association of America ("GCSM") is the national organization that rates and certifies golf course superintendents. Less than ten percent of all greenskeepers are certified by the·GCSAA. Johnson was certified as a golf course superintendent by the OCSAA at the age of29 and Johnson has received numerous post-college continuing education certificates in .the golf field. His experience in the golf industry is significant and is exceptional. Johnson's proposals, demonstrated that Johnson had the ability to maintain a facility and that it bad actually grown and built putting greens, practice areas, fairways and greens;
10

·1.

j.

14.

Another Commission member admitted hiB bias toward Friel, that in giving plaiDtiff' lower ratings than it deserved he was "trying to justify his conclusion." He further admitted that given the same abilities and more money being offered by plaintUJ, the member would still vote for Friel

a.

though the abilities of Friel and Johnson were the same and Johnson offered more money) that was not enough for him to give the contract to Johnson and that he did not give Johnson full credit for his experience in managing 18 hole golf courses, that Iohnson should have received a highly advantageous rating but that he gave Johnson an advantageous rating. He admitted that he should have given Johnson highly advantageous ratings for managing a club house, mailaging clay . tennis courts and managing a pro shop. He admitted that he had no ·explanation as 10 why he gave Johnson a disadvantageous rating in the area of managing a pool.
b.

This Commissioner, an attorney by training; admitted that even if-Johnson bad received a highly advantageous rating in every category of the evaluatory criteria, he would still have recommended and selected ·Friel. He testified that even

This Commissioner, an attorney; wanted the Commission to recommend Friel because it had "paid its dues". In simple terms, he admitted that he felt that while Johnson was not qualitatively inferior to Friel, he did not want to disrupt his comfort factor with Friel, even though Johnson had offered more money.

15.

Still another testified he was not concerned about the money in making his decision " ••• egardless of the price Johnson offered he was not going to reeommead (the r plaintiff)" •. Further he gave Friel a highly advaiatageous rating for a head chef when none had been named as was clearly required by the RFP specifications.

a.

Friel should not have been considered or awarded the Contract because of its shortcomings in the food and beverage operation at·BOTe. First, Friel should not ·have been considered because it failed to comply with the RFP requirements ·relating to a chef. Second, Johnson's proposal regarding the food and beverage · operation coupled with Friel's historically poor performance should have resulted ·in award of the Contract to Johnson. Third, in examining the Defendants . .handling of the food and beverage aspect of the RFP; it is clear tliatthe .Defendants would take any and all steps necessary to award the Contract to Friel.· According to Mayor Scanlon, the golf course and the banquet facility are the two . most important aspects of.the club. In Section II. B., the RFP required that the "chefmust..have at least three (3) years proven experience at a facility of the size and complexity of the Beverly Tennis and Golf Club." In Section m. D., the RFP required each bidder to complete a "Bidder Team (Form. 2)" which included an area for listing a chef. Section IV of the RFP set forth certain threshold criteria for bids and stated "Proposals must meet the following criteria for further consideration: (a) Meet the qualifications described in Section II. B., (b) Submission of all items .requested in Section Ill, (c) Have identified in the proposal the qualifications of all key personnel including a ...chef." .. . .. ..
11

... b. c.

d.

. The Inspector General requires that "[a]ny proposal which faiIs to comply with

the proposal submission requirements or fails to meet any of the minimum criteria for responsiveness and responsibility must be eliminated from the competition." In describing how to avoid bid protests, the Inspector General noted " .•Play by your own rules ...Chapter 30B does not allow a minimum requirement to be ·waived after the fact when the effect would be to undermine fair competition." Mayor Scanlon admitted that a fair and impartial consideration of the proposals would have resulted in Friel's proposal not having Peen further considered . because they did not, in their proposal, set forth a chef with a minimum of three years experience as required by the RFP. In Bidder Form 2 that was submitted by Friel, Friel did not designate ahead chef. The requirement to list the chCfwas so important to the Defendants that the RFP required disqualification for noncompliance with the technical requirement. Yet, despite the D.efendant's own requirements, Mayor Scanlon admitted that the Defendants "let Friel off the hook on that technical requiremenf' .

e.

. f. .

Various Commission members admitted Friel did not designate a head chef with the requisite experience but that they gave Friel ''the benefit of the doubt" despite · Friel's failure to comply with the RFP and one Commissioner admitted "the document says it should [disqualify Friel] but I didn't". Another Commissioner · admitted he let Friel "slide" on that issue. One Commissioner, a lawyer, admitted . . that the RFPrequires disqua1ification and admitted that the RFP does not permit .substituting personal knowledge that a bidder is interviewing potential chefs for the requirement that a chef with three years· experience be ·designated. Further, the regulations issued by the Inspector General require that any proposal that does · not meet criteria be eliminated from further consideration.

minimum.

. g.

One Commissioner admitted that Friel had acknowledged to the Commission that Friel was having. problems with the food and beverage operation and they had to get rid of a chef. The Chairman of the Commission admitted "They had a chef and they bad trouble with the chef. You know, he wasn't the first one. They had . several chefs in and out" Frielhad a lot of trouble with chefs coming and going. Another Commissioner admitted Friel "was having difficulty with the restaurant The restaurant was causing them some grief ..They just couldn't get a good chef. · . They couldn't-get a good menu ..." and the. quality of the food "was not good." '. The Commissioner admitted Friel was having problems with its food and beverage operation and it had to get rid of its chef. Sometime prior to April 25, .1997, Friel had fired its chef. The Commissioner admitted "I think as a weakness if there was a weakness in the Friel proposal, it was probably their inability to maintain a constant high level of service in the restaurant due to the roll over of its chefs!' He admitted that Friel's ''work in the area of the restaurant and function. facility wasn't up to snuff." Through the investigation of Johnson, the 'Commission discovered that the specialized partnering relationship that Johnson had with Steve Gotreau of Special Events Catering would result in a very good restaurant One Commissioner admitted that Johnson "would run a better restaurant than the Friel's would because the Friel's are in the golf business and not in the restaurant business" and Iohnson had a person that subleases from him and "it looked like he had a good reputation and he did nice ·stuff.'~The .
12

Commissioner admitted that Johnson's proposal was superior to Friel's proposal in the food and beverage area. Johnson testified that he specifically created the specialized partnering relationship with Special Events Catering so that it could make the BGTe a "top notch facility" especially because Johnson's review of the financial infonnation provided by the Commission suggested that the food and beverage operation was being "underutilized".
16. - One member described the rating sheets prepared by the City as "grammar school -report cards" which he was en~tled to ignore and which he did ignore in evaluating the incumbent operator and plaintiff. The practical effect of this reasoning did, and WaJ intended to benefit Friel. _

a, _ _This Commissioner downgraded Johnson from highly advantageous to advantageous in the area of experience managing clay tennis courts without explanation or reason. This Commissioner admitted that ifhe followed the standards set forth inthe RFP he would have given. Johnson a hi8hly -. .-advantageous rating for experience in managing clay tennis courts, managing a pro shop, managing a pool and maintaining grounds. He admitted that if he followed the standards set forth in the RFP he would have given Johnson a highly advantageous rating for its golf professional, tennis professional and greenskeeper. He admitted that if he followed the standards set forth in the RFP - ._he would have given Friel a disadvantageous rating for its designated chef and tennis professional. b. He clearly used a differ~t standard when evaluatin-gthe proposals by not lowering the evaluations of Friel when they failed to designate personnel (i.e., chef) in the proposal, on the one hand and lowering Johnson's rating because Johnson did not bring all its personnel (i,e., golf pro) to the in~ew, on the other, the effect of which was to favor Friel and disadvantage Johnson. He _ admitted that inevery, single instance where he did not follow the-criteria set forth in the RFP, it had the effect of downgrading Johnson and upgrading Friel.'

- 17.

A Commission member failed to give Johnson the maximum "HA" (highly -_ advantageous) ratiog In swimming pool management-although her employer, whom she acknowledged as competent and c:apable, was named as pool manager and his 10 years experience alone required the-"HA" rating.
One member gave Friel [a dis]advantageous "D" rating [for its chef] at the time of the second RFP [noting "new chef here' 1and under identical c:ircumstances inexpHably upgraded. [Friel's new chef] to [] advantageous "OA" at the third RFP. The evidence discloses innumerable other instanees of transparent -Jf)hnson and upgrading Friel. downgrading of -

18.

19.

13

a.

Universally, the "mistakes" in the qualitative ratings involving the proposals of Friel and Johnson had the effect of downgrading Johnson and upgrading Friel. The Commission incorrectly upgraded the Friel proposal upwards of 40 times and downgraded theJohnson proposal approximately 57 times. I find that the upgrades and downgrades were intentional actions on the part of the Commission · members and were designed to insure that Johnson did not receive the Contract
· that Johnson could have bid that would have changed his decision to select Friel. The Chairman admitted that there was no level of qualifications that Johnson · could provided that would have changed that Commissioner's decision to select Friel. At trial the chairman was asked the following questions and gave the

h.

The chairman. of the Commission admitted that there was no amount of money

· following responses:
Q: In fact, there

.

of money that Johnson Golfcould have bid that . .. .would have changed you decision select Friel Golf, correct.

was no amount

to

A: Yes.
· Q: And, infact, there was no level

of qualification that Johnson could provide that would have changed your decision to select Friel Golf, correct.
A: That's correct.

Q: So no matter how much money or how much quality Johnson Golf came to . .' the table with. you weregoing to select Friel Golf, correct? : A: It didn't make a difference who the bidder was.

Q: And as you described it, there was no level of qualification Johnson could have provided. or no amount of money that Jobnson Golf could have provided that

would have caused you to select them. over Friel, rigbt?

A: In my mind,

no, that's correct. .

'. no amount of qualification o~ money would change your position, right? A: That's right.

Q: It didn't matter if there

was anyone better because you testified yesterday that

"Inthe area of experience managing an 18 hole golf course, the Commissioner admitted that he gave Johnson an advantageous rating when he should have given them a highly edvantageous rating. In the area of managing a swimming pool, he . ·admitted he gave Johnson a disadvantageous rating when he should have given . them a highly advantageous rating. In the area of managing clay tennis courts, he .
14

admitted he gaveJohnson an advantageous rating even though his stated . experience was more than 10 years which is the standard for receiving a highly advantageous rating .. This Commissioner admitted that in evaluating a . prospective employee's experience. he would consider all prior jobs and historical experience. Incredibly. however. when he evaluated Johnson, he refused to do . that and only looked at current operations despite the RFP not making any limitation on. experience to consider. On the other hand, while discounting Johnson's stated experience, he gave Friel the benefit of the doubt for a chef that was.not even listed in their proposal. He refused to follow the RFP saying, like . . Frank Sinatra, "I did it my way" which, of course, did not give Johnson the benefit of all its experience. c. Another Commissioner rated Johnson as. advantageous' in the area of golf pro even though she herself noted that'the designated golf pro had twelve years. of . experience, She admitted that the rating should have been highly advantageous. She admitted that based on resume of Friel's tennis pro, Peter Drinkwater, Friel deserved a disadvantageous ratmg in the area of tennis pro. Nonetheless, she gave Friel an advantageous ratiDg in the area of tennis pro. On the other band, she admitted that she gave Johnson's tennis pro a disadvantageous rating when his resume clearly indicated both thai he deserved a highly advantageous lating and that he was more qualified than Friel's tennis pro. With respect to having a licensed greenskeeper, she admitted that she did not give Johnson a highly advantageous rating even though she should have done So based on Steve . . Chiavaroli's experience. Likewise, she admitted that she should have rated . Johnson highly advantageous in the area of managing pro shops.

the

. d.

«...regardless of the price Johnson offered Johnson." With respect the head chef, he admitted that he gave Friel a highly advantageous rating even though they had not designated any head chef as required by the RFP.· He admitted that Friel should have received a disadvantageous rating for not having designated a head chef. He 'admitted that he should have rated Friel as disadvantageous in the area oftemrls professional rather than. the highly advantageous rating that he gave them. With respect to financial strength, he gave Johnson an advantageoUs/disadvantageous .rating despite Treasurer Dunn's analysis and report to the Commission that . Johnson was financially qualified. With respect to experience in managing an 18 .hole golf course, he gave Johnson an advantageous/disadvantageous rating even though the proposal showed that Johnson had more than ten years of experience and should have therefore received a highly advantageous rating. With respect to experience in managing clay tennis courts, he gav~ Johnson an advantageous rating even though the proposal showed that Johnson had more than fourteen years of experience and should have therefore received a highly advantageous rating. With respect to experience in managing a pro shop, he gave Johnson an advantageous/disadvantageous rating even though the proposal showed that Johnson had more than ten years of experience and should have therefore received ~ highly advantageous rating. With respect to experience inmaintaining grounds, he gave Johnson an advantageous/disadvantageous rating even though the proposal showed that Johnson had more than ten years of experience and should have therefore received a highly advantageous rating. With respect to the golf

. Another Commissioner testified that

[he was] not going to recommend

15

pro, he gave Johnson an advantageous rating even though the proposal showed ,that the golf pro should have received a highly advantageous rating .. With respect to the greenskeeper, he gave Johnson an advantageous/disadvantageous rating . even though theproposal showed that Johnson had more than ten years of " . . experience and should have therefore received a highly advantageous rating. At thetime of its bid, Friel had not legally existed for ten years. He looked at entities .and experience other-than that of the bidder, Friel, in evaluating its bid in order to

e.

give them highly advantageouS ratings. . ' . Another Commissioner admitted he should have given Johnson a highly advantageous rating in every area of experience and that Johnson's should have received an unqwilifiedcomposite rating of highly advantageous. He admitted that he gave Johnson lower ratings than it deserved; He admitted that Friel should have been graded disadvantageous in the chef category. Interestingly, in the .Second RFP evaluation, under the same circumstances, he gave Friel a , disadvantageous rating for his chef and inexplicably upgraded the rating to advantageous in the Third RFP. He gave Johnsonan.advantageous rating for managing 18 hole golf course despite the fact that Johnson had, atminimum, seven years experience at SouthShore Country Club alone. He admitted that he should have at given Johnson a highly advantageous rating for e~ence in managing ali 18 hole course. He gave Johnson an advantageous rating for . . managing clay tennis courts .and noted in his reasons for rating "no recent experience in clay courts" even though the Second RFP did not call for "recent" experience. ' Johnson should have received a highly advantageous rating. He gave Friel an advantageous rating in the area of head chef even though Friel did not designate a head chefin its proposal. He incorrectly downgraded Johnson's proposal regarding experience managing 18 hole golf courses. Even though . Johnson had more than ten years experience in managing 18 hole golf courses, he 'rated Johnson as advantageous ...He admitted he should have given Johnson a . highly advantageous rating. In evaluating Johnson's experience managing a clubhouse, he rated Johnson as advantageous. He admitted he should have given Johnson a highly advantageous rating. In evaluating Johnson's experience managing clay tennis courts, he rated Johnson as advantageous. He admitted he , 'should have given Johnson a highly advantageous rating. In evaluating Johnson's experience managing a pro shop, he rated Johnson as advantageous. He admitted he should have given Johnson a highly advantageous rating. Although he gave Johnson an advantageous rating in the areaof'pcol management, he admitted he should have. given Johnson a highly advantageous rating. In evaluating Johnson's :experience maintaining grounds, he-rated Johnson as advantageous. He admitted . he should have given Johnson a highly advantageous rating.

an

f.

Even though Johnson had more than ten years experience in managing 18 golf courses, another Commissioner rated Johnson as advantageous. She admitted she should have given Johnson a highly advantageous rating. Even though Johnson had more than ten years experience in managing clay tennis courts, she did not give Johnson a rating and put a question mark in the evaluation sheet. She admitted she should have given Johnson a highly advantageous rating .: Even . 'though Johnson's designated personnel had more than ten years experience in managingswimnling pool programs, she rated Johnson as advantageous. She . . admitted she should have given Johnson a highly advantageous rating. She gave
16.

.

.

.

Friel an advantageous rating in the area of head chef even though Friel did not .designate a head chef in its proposal. She admitted she should have given Friel a disadvantageous ratings for its chef. ·She gave Johnson an advantageous rating in the area of'head.chefbut admitted she should have given Johnson a highly advantageous rating.
. . 20. without filing with the Office of th~Inspector General, as required by statute, to change an authorized awardib.g authority, and with fuU knowledge that . the authorized indMdual, BradIey, as weD as City Treasurer·Dunn, both favored awarding the contract to Johnson, the Mayor stepped to the plate.

Finally,

·21. .. On July 28 a fully convened meeting of the Commusion was·held by the Mayor. The recording secretary, present at aD prior meetings, was not invited to attend and in violation the Beverly ordinances, a meeting ",as held without minutes.

of

a.

By ordinance, the Mayor has the obligation to enforce Beverly's ordinances. The .ordlnaaces require minutes of &l meetings of the Commission, and the Commission's failure to have minutes of the Johnson interview and its meeting with the mayor were violations of the city ordinances. No minutes, audiotape or videotape was kept of the interview of Johnson or the July 28 meeting with the Mayor, both of which were fully convened meeting of the Commission. The Defendants intentionally failed to keep minutes of certain meetings during the RFP process, namely the interviews of Johnson and the July 28 Mayor Meeting, in an effort to conceal their effort to discredit Johnson and give the Contract to Friel. .

b.

c.

22.

I find that at that meeting the·Mayor heard in detail the wishes of the Commission members, that the incumbent operator, Friel, be -reappointed, that his eXamination of the documentation of the entire bid process (professed by him to have taken place oyer some 40 hours of stUdy) disclosed to him the ract that Johus(JD'. operation would be equal, ifnot superior, to.Friel's, as well as tbe fact that Johnson was . offering to pay an additional S400,000.00. .
a.

One Commissioner admitted that he stated to Mayor Scanlon that he was biased in favor of Friel.
·One Commissioner admitted he told Mayor Scanlon that he was concerned about the lawsuit filed by Johnson against Beverly and that he would not have

b.

recommended Johnson regardless of how much money it offered. c. Commission members improperly evaluated Johnson negatively because of the lawsuit filed by Johnson against the· City of Beverly and the Commission and Mayor Scanlon was fully aware of the improper animosity on the part of the Commission members toward Johnson.

17

i.

Mayor Scanlon testified that during the course of the July 28 Meeting someone made a reference to being upset over being sued by Johnson. . ii. .Mayor Scanlon admitted that no one complained about a lack of cooperation or chemistry issue with Johnson prior to Johnson filing a lawsuit and none of the alleged interpersonal difficulties with Johnson existed or arose prior to Johnson filing suit. After the lawsuit had peen . filed, after Johnson had obtained an injunction and while the Commission was in the process of rebidding the Contract, the July 28 Meeting took . place. MaYQrScanlon admitted that at the July 28 Meeting Commission members raised their voices and "got emotional" in talking about Johnson. . Clearly, the Commission was not obj~ve about Johnson Golf. iii. Commission members, and the Commission as a whole, were unhappy that Johnson filed suit and obtained an injunction preventing the award of a contract to Friel. The testimony revealed that a number of the Commission members had expressed upset oyer the lawsuit filed by Johnsonand that it contributed to commission's actions toward Johnson:

23.

I find the MaYor was motivated in his decision politically and chose to ignore the requirements of G.L. Ch. 30B. a. Mayor Scanlon, admitting that Johnson was qualified and had offered the most ·money, claimed that Johnson's behavior at the interview for the Third RFP was the sole disquaIifyiD.g reason why the Defendants did not award the Contract to Johnson. However, it is clear that Johnson coriducted itself appropriately at the interview, Mayor Scanlon knew ~t it was the Commission and not Johnson that acted inappropriately and, therefore, Mayor Scanlon should have. awarded the Contract to Johnson. . .: Mayor Scanlon claimed that.he did not take the decision lightly and spent "a full week trying to think about the matter from all possible angles." Mayor Scanlon allegedly spent on the order of forty hours making the decision, including ·eighteen hours reading the RFP, the proposals ·submitted by Johnson, Friel and ·Palmer and the Commission's evaluations and Iookiag at the Commission's .. evaluations and checking them "to make sure that there weren't any obvious , errors ...". Mayor Scanlon was asked whether he looked at the proposals to confirm that the bidders were qualified to which he responded "I looked at all the proposals." Mayor Scanlon was then asked whether he reviewed the proposals to see whether the bidders stated experience was accurately reflected in the ratings of each Commission member to which the Mayor responded "I tried to, yes," During trial, Mayor Scanlon, reviewed the proposals and the RFP to come up with · evaluatioris of Friel and Johnson in less than two hours. Having done that, Mayor Scanlon admitted that Johnson deserved a higher rating qualitatively than Friel. · Mayor Scanlon was asked "So would you agree with me based on what we have .done in the last hour and a half, that a fair evaluation of the two proposals would .reflect that Johnson Golfwould actually score higher than Friel Golfbased on the proposal submitted, correct?" to which Mayor Scanlon replied "Based on the approach you are taking here, yes." Mayor Scanlon was then asked "And the · approach I'm taking here is the approach set forth and required by your city's
18

h.

c.

RFP, correct?" to which Mayor Scanlon replied "yes," Mayor Scanlon admitted that he "came out with a rCIatively high ranking on Mr. Johnson from this particular part of the effort" A. review of the proposals and the Commission's. evaluations, along with Mayor Scanlon's review of the proposals at trial revealed the following admissions by Mayor Scanlon: . i. Johnson deserved a highly advantageous rating for financial strength and was downgraded by one Commissioner. ii.· Johnson deserved a highly advantageous rating in the area of managing an 18 hole golf course. Five out of eight Commission members downgraded Johnson. . iii. Johnson deserved a highly advantageous rating in the area of managing a clubhouse. Seven out of eight Commission members downgraded Johnson. iv. Johnson deserved a highly advantageous rating in the area of managing clay tennis courts. Seven out of eight Commission members downgraded Johnson. Friel deserved an advantageous rating but was upgraded by seven out of eight Commission members. v. Johnson deserved a highly advantageous rating in the area of managing a pro shop.. Eight out of eight Commission members downgraded Johnson. ·Seven out of eight Commission members upgraded Friel in the area of managing a pro shop. . vi. Friel deserved an advantageous rating for experience m8lJaging a. pool and Johnson deserved a highly advantageous rating. Six out of eight Commission members upgraded Friel in this area. Eight out of eight ·Commission members downgraded. Johnson. vii. Johnson deserved ahigbly advantageous rating in the area of maintaining grounds. Seven out of eight Commission members downgraded Johnson. viii. Johnson deserved a highly advantageous rating in the area of general manager. Three out of eight Commission members downgraded Johnson. ix. There is insufficient information in Friel's proposal to rate Friel's golf professional .. Friel's golfprofessional therefore should have been rated disadvantageous. However, eight out of eight Commissioners. upgraded · Friel's golfprofessional. Only Johnson's golf professional clearly stated that he was a Class A golfprofessiorial. Johnson's golfprofessional deserved a highly advantageous rating. Four out of eight Commission inembers downgraded Johnson. x, Johnson's licensed greenskeeper deserved a highly advantageous rating. Two out of eight Commission members downgraded Johnson. xi. Friel's tennis professional deserved a disadvantageous rating but was upgraded by five out of eight of the Commission members. Johnson's .tennis professional deserved a bighly advantageous rating. Four out of eight Commission members downgraded Johnson. . xii. Friel's chef deserved a disadvantageous rating but Was upgraded by the seven out of eight Commission members. Johnson's chef deserved a highly advantageous rating. Two out of eight Commission members downgraded Johnson.

..
19

d.

A head to head comparison of Johnson (and its designated staff) and Friel (and its designated staff) reveals that Johnson is clearly superior and deserves a higher ratingthan Friel. ·.~yor Scanlon admitted that all eight Commission members upgraded Friel in one category or another. No Commission member downgraded Friel in any category. No Commission member upgraded Johnson. All eight Commission members downgraded Johnson in one category or another. There were approximately 40 upgrades of Friel and approximately 57-downgrades of Johnson. It is not a coincidence that all of the supposed "mistakes" benefitted Friel and harmed Johnson. Mayor Scanlon's "failurett to recognize the errors Commission's evaluations was intentional, particularly in light of Mayor Scanlon's claim that he "looked for errors", In any.event, I find that Mayor Scanlon is responsible for the intentional misdeeds of the Commission, particularly he admitted he relied on their work 'and "didn't question their . · judgment. Mayor Scanlon himself acknowledged that he is ultimately · responsible and that "the buck stops here" when refeningto himself.

e.

where

II.

f.

Mayor Scanlon does not have notes or records relating to the forty hours he . .allegedly spent making his decision because allegedly he threw away his written , notes and erased the charts and notes he placed on the blackboard. Because he believed that Bennett. Walo and Altshuler were biased.Mayor Scanlon allegedly discounted their opinions. by 75 to 90 %. Mayor Scanlon also acknowledged that the bias of Bennett. Walo and Altshuler could have affected the thoughts and evaluations of other Commission members but failed to make any inquiry to detennine whether the opinions of Commission members were being affected by the pro-Friel bias of Bennett, Walo and Altshuler. Mayor Scanlon claims that, having discounted by 75 to 90 % the opinions of three of the four Commission members that recommended Friel, he skipped over two qualified and financially superior companies (Johnson and Palmer) to select the incumbentoperator; Friel, who was dead last financially. Mayor Scanlon. . .admitted he did so even though Palmer was qualified, offered more money than ·Friel and did not have the alleged cooperation issue posed by Johnson. Mayor Scanlon admitted he did so even though Iohnson was qualified and offered the most money of all the bidders. He claimed that his decision not to select Johnson .was not based on lack of quality or price but was because something he . described as "poor chemistry" between Johnson and the Commission. The RFP does not mention the word "chemistry" or have any reference to "chemistry" or cooperation with the Commission as being a decision criteria. As set forth above, Johnson acted appropriately toward the Commission. Any "poor chemistry" is ·the sole fault of the Defendants and Mayor Scanlon knew it Mayor Scanlon's decision to award the Contract to Friel is without credible basis and can only be attributed to the Defendants bad.faith desire and motivation to avoid Johnson at all costs, to award the Contract to Friel at any cost to the tax paying residents of Beverly and to act without regard to the rights of Johnson.

any

g.

.h,

of

20 .

.i.·

Mayor Scanlon essentially admitted that despite Johnson's quality and superior financial bid, there was no amount of money that Johnson could have offered that would have resulted in Mayor Scanlon selecting Johnson. . Mayor Scanlon based his decision to award the Contract to Friel on poor chemistry and the alleged lack of cooperation on the part of Johnson during the .interview. Mayor Scanlon stated that "in a broad sense"!ack of chemistry was the "sole disqualifying factor for Johnson" and adMitted that he believed that some of the lack of chemistry was attributable to the Commission. Mayor Scanlon admitted that he did not award the Contract to Johnson because there were "some badly ruffled feathers" on the Commission and as a result over $400,000 in taxpayer money was "left on the table". In responding to the question ''In fact, the lack of cooperation could be attributed. to the Commission members, correct?', Mayor Scanlon stated "Some of them, I think,'

j. .

k.

called, met or interviewed Mr. Johnson or any representative of Johnson even though he claims he spent 40 hours making his decision. Mayor Scanlon admitted he' did not take any steps to independently verify whether the Commission members claims that they could not work with Johnson were valid concerns . .Mayor Scanlon never viewed any of the courses operated by Johnson as part of his decision making process and never bothered to talk to Johnson's employers in other towns (such as Hingham, Duxbury, AUburn) or otherwise check anywhere to see if his Commission members were accurate in saying that Johnson was confrontational. Having been warned by Jeff Conley that the Commission was not fairly rating or treating Johnson, the Mayor's conduct was clearly an effort to favor Friel and disregard valuable available information regarding Johnson. Mayor Scanlon probed Commission members to bring. out their negative opinions ..about Johnson Golf and intentionally did not bother to ask questions of Commission members to ascertain whether their opinions' were biased based on . the lawsuit filed by Johnson. .Mayor Scanlon also intentionally and in a calculated .. manner failed to ask questions of Commission members regarding the obvious eITOIS in the ratings given by them. Mayor Scanlon admitted "I did not go inside ~eir evaluations to see if they were honest evaluations ..." even though Mayor Scanlon admitted that Commission members "did indicate that they weren't perfect." He admitted he did not bother to probe what that meant; he "didn't pursue that line of questioning.". His testimony implied that the Commission . . members admitted that they were confrontational and that they felt they could not . work with Johnson because of the lawsuit Johnson had filed. . Mayor Scanlon admitted that the ordinances of Beverly require Beverly to give . preference of employment to a Massachusetts company such as Johnson over a New Hampshire company such as Friel, that he failed to do so and that his failure to do so was a violation of his own City ordinances. Mayor Scanlon's admissions are further evidence of the Defendants ·complete willingness to disregard the law in order to insure that Friel, and not Johnson, was awarded the Contract.
21

"As part ofhis plan to select ~riel and ignore other bidders, Mayor Scanlonnever

1.

m.

n.

Throughout his testimony, Mayor Scanlon was. argumentative, evasive and deceptive; many times he refused to answer simple questions, feigning an inability to understand basic fundamental questions concerning the RFP process. . illustrations ofhis evasiveness are: i. Mayor Scanlon had great difficulty even acknowledging his own signature and affidavit.· . 11. Mayor Scanlon's bias and evasiveness was found in h,is testimony concerning Mike San Fillipo, the golf pro designated by Johnson. Despite the overwhelming qualifications on his resume, the Mayor tried to establish that Mr. San Fillipo "moved around a lot" and that he had been unemployed. The Mayor's testimony about Mr. San Fillipo, if it were credited, would establish thBt the Mayor reviewed the·proposals in minute detailand he easily could have properly evaluated the competing . proposals. m. Mayor Scanlon claimed that (according to Bennett) Mr. Johnson had . claimed during his interview that the Commission had to hire Johnson because he was the high bidder. However, Johnson did not make those statements and could not have made such a statement because at the interview stage of the process, the financial portion of the bids were Sealed.

o.

It would have taken Mayor Scanlon less

than two hours to completely review all . of the proposals. The totality of the evidence submitted clearly demonstrates approximately' 40 "upgrades" for Frier s proposal and approximately 57 "downgrades" for Johnson's proposal. It is I!Ql a coincidence that there was not even one upgrade of Johnson or one downgrade ofFrie!' The grading demonstrates intentional bias against Johnson and favoritism for Friel which is "tantam~unt to bad faith" on the part of the Defendants. The Defendants have willfully and intentionally violated the provisions of G.L. Ch. 30B pertaining to capital improvements and the requirement that public contracts be in writing. The activities of the Defendants disclosed in these proceedings are precisely the actions forbidden by the Massachusetts Laws pertaining to public contracts.· The Mayor's. ''pretext'' for not selecting Johnson was a "lack of chemistry". A cursory review of available information by the Mayor would have disclosed that. any lack of chemistry was due to the "bad faith" actions of the·Commission and that the Commission was 100% responsible for any perceived. "lack of chemistry".

find the decision of the Mayor to award the contract to Friel was based essentially on his acceptance of data furnished and opinio~s expressed by Commission members. I further find having eonsidered the material for 40 hours he knew the data and opinions . were skewed. 25. I find the ·stubborn insistence by the BGTC Commissioners on using a r8vorite contractor (Friel) for a public contract (3rdRFP), regardless of the pubUc interest, constitut~ bad faith. 26. I further find the procedures foHowed by the Commission members in reaching their conclusions to have been 50 flawed and.in contravention of essential elements ofG.L. Cb. 30B a~ to co-.stitute bad ~aith.
22

24.

27.. Inc.

i find,

on the issue of liability, for the Plamtiff, Johnson

'i'urfand

Golf Management,

CONCLUSIONS OF LAW "Statutory bidding procedures are designed to prevent favoritism, to secure honest methods of letting contractsia the public interest, to obtain the most favorable price, and to treat all persons equally." Phip_psProducts y. Mass. Bay Transp. Auth., 387 Mass. 687,443 N.E.2d 115 (1982). Any bidder competing for a public contract can challenge the award of that contract in court on the grounds that the awarding authority did not comply with public bid laws. Quincy Ornamental Iron Works. Inc. v. Findlen. 353 Mass. 85228 N.E.2d 453 (1967). The bidder is not . required to pursue any administrative process with the Office of the Inspector General. (See Inspector General's Guidelines).· . . Competitive bidding serves the dual goals of obtaining the most favorable contract while .ensuring fair competition. White's Farm Dairy. Inc. v. City of New Bedford. 10 Mass.L.Rptr. 348 (Mass. Super. 1999) (Garsh, 1.). An "awarding authority must review the bids fairly, free ofbad faith or arbitrary or capricious conduct, in order to promote the significant public interest at stake." J.S. Luiz ill. Inc. y. Town of Hanson, 41 Mass.App.Ct. 1104,669 N.E.2d 232 (1996) (citation omitted). "[P]rinciples ofjustice and good faith compel an examination of the [city's] true motives in rejecting [Johnson's] bid." 1.8. Luiz m. Inc. y. Town of Hans'on. 41 Mass.App.Ct. 1104~669 N.E.2d 232 (1996) (citation omitted). "[S]tcict adherence to statutory bidding requirements is required in matters of substance ...Non. compliance with the procedures established by the Legislature .for the award of public contracts is not excused by the absence ofbad faith or corruption, ..Even the best of motive cannot excuse Contravention of the statute. White's Farm Dairy. Inc. y. City of New Bedford. 10 Mass.L.Rptr. 348 (Mass. Super. 1999) (Gersh, J.). A city may not, "in good faith,. offer a bogus reason for rejecting the plaintiff's bid, while concealing its true but impermissible motive." 1.S. Luiz ill. Inc. v. Town of Hanson. 41 Mass.App.Ct. 1104,669 N.E.2d 232 (1996) • .A city must "consider the bids fairly and impartially and [is] .bound by the terms set forth in its invitation to bid,' 1.S. Luiz nI, Inc. v. Town of Hanson. 41 Mass.App.Ct. 1104,669 N.E.2d 232 (1996) (citations omitted). . . .A public authority inviting bids may not, like Humpty Dumpty, choose to let words it uses in an invitation mean what the public authority choose those wolds to mean. White' 8 Farm. Dairy. Inc. v. City of New Bedford, 10 Mass.L.Rptr. 348 (Mass. Super. 1999) (Garsh, I.).
to bid that each bid submitted will be fairly considered in accordance with all applicable statutes, and that a failure to give such consideration . is a breach of the implied contract formed by the submission of such a bid .. Roblin Hope .
.

.

.

It is an implied condition of every invitation

23

·Industries. Inc. v. J;A. Sullivan Com., 6 Mass.App.Ct. 481,377 N.E.2d 962 (1978); see also · School Buildina Committee for the Town of Greenfield v. Commercial Union Insurance Company, 37 Mass.App.Cl911, 638 N.E.2d 499 (1994); Paul Sardella Construction Co.. Inc. v. Brain1ree Housing Authority. 3.Mass.App.Ct. 326,329 N.E.2d 762 (1975). . "[I]f a bidder has complied with all requirements but is deprived of the contract through some conduct of the awarding authority tantamount to bad faith, then the recovery of lost profits is the measure of damages." Peabody COnstruction CO.. Inc. v. City of Boston. 28 Mass.App.Ct. 100, 546 N.E.2d 898 (1989) (citing Bradford & Bigelow. Inc. v. Commonwealth. 24 Mass.App.Ct. 349,359, S09 N.E.2d 30 (.1987); E. Amanti & Sons. Inc. v. Town of Barnstable, 42 Mass.App.Ct. 773,679 N.E.2d 1028 (1997); see also I.S. Luiz III. Inc. y. Town of Hanson, 41 Mass.App.Ct. 1104, 669.N.E.2d 232 (1996); see also White's Farm Dairy. Inc. v."City of New Bedford. 10 Mass.L.Rptr. 348 (Mass. Super. 1999) (Garsh, J.) (application oflost profit theory to O.L. Ch. 30B case); Natick Auto Sales, Inc. y. Dej!artment of Procurement and General Services, 47 Mass.App.Ct. 625, 715 N,E.2d 84 (1999). .
. .

"Tantamount" means equivalent in value,"significance or effect. Webster's New Collegiate Dictionary;p. 1182 (1979). . "Bad faith 'stacking the deck' to benefit insiders is what public bidding laws are designed to · prevent Bowman v. Drewzy.et al., 5 Mass.L.Rptr. 104 (Mass. Super. 1996) (Sosman, J.). The remedy of lost profits is intended to vindicate the public interest in ensuring·that all bids are treated fairly. BmdfQrd & Bigelow. Inc. Commonwealth, 24 Mass.App.Ct. 349, 359, 509 N.E.2d 30 (1987); White's Fann Dairy, Inc. v. City of New Bedford, 10 Mass.L.Rptr. 348 (Mass. Super. 1999) (Garsh, 1.).

v.

. "The criteria on which proposals will be evaluated are to be set by the chief procurement officer and stated inthe request for proposals ...The evaluation of non-price factors is to be 'based solely ·on the criteria set forth in the request for proposals.' Bowman v. Drewry. et aI., 5 Mass.L.Rptr. 104 (Mass. Super. 1996).(Sosman, 1.) (citing GL. Ch. 30B). . Without a rational basis, an awarding authority may not establish or usc criteria for evaluation that effectively elimi:riates all proposals but that of the incumbent operator. "Bad faith 'stacking the deck' to benefit insiders is what public bidding laws are designed to prevent" Bowman v. Drew. et al .. 5 Mass.L.Rptr ..l 04 (Mass. Super. 1996) (Sosman, J.). · "The court is mindf\ll that, to many.townspeople and to the selectmen that have backed the [incumbent's] proposal, the selection of [the incumbent) was simply an application of the principle 'if it ain't broke, don't fix it' Satisfied with [the incumbent's] performance over the ... last ten years, they are reluctant to replace him with a new lessee. That view is understandable, but the Uniform Procurement Act requires that other principles must also be honored "in the awarding of public contracts. In the interest of fair and open competition, in the interest of the public fisc, and in the interest of preventing favoritism. and corruption inpublic contracts, the · Uniform Procurement Act mandates that public contracts and leases be opened up to other · competitors. Existing contractors must, no matter how long and successful their contractual relation with a ·government agency or municipal body. be prepared to face competition from other providers, who may be willing to offer the public better goods, better services, or better p~ces. When such a competitor comes along, the desire to simply stay with he provider who has
24

. serviced Town's needs previously must yield to the benefits that open competition have presented." Bowman v. Drewry, et aI•• 5 Mass.L.Rptr. 104 (Mass. Super. 1996) (Sosman, J.). Stubbom insistence on using a favored contractor for a public contract, regardless of the public ' ,interest, would constitute bad faith. Roblin Hope Industries. Inc. v. J.A. Sullivan Corp .• 6 Mass.App.Ct. 481, 377 N.E.2d 962 (1978); White's Farm Daily. Inc. v. City of New Bedford. 10 , Mass.L.Rptr. 348 (Mass. Super. 1999) (Garsh, J.). : "Bad faith is the opposite of good fai~ generally implying or involving actual or constructive fraud; or a design to mislead or deceive another; or a neglect or refusal to fulfill some duty or some contractual obligation not prompted by an honest mistake as to one'srights or duties but by some interested or sinister motive. The term bad faith. is not simply bad judgment or negligence, but rather it implies the conscious doing of a wrong because of some dishonest purpose or moral obliquity." 1.S. Luiz m.lne. v. Town of RanSOD. 41 Mass.App.Ct. 1104, n. 12, 669 N.E.2d 232 , {1996).' ' . ' Bad faith occurs when there is a' "breach of a known duty out ofill will or some interested or' ulterior motive." White's Farm Dairy. Inc. v. City of New Bedford. 10 Mass.L.Rptr. 348 (Mass. Super. 1999)(Gars~ J.). One acts knowingly with respect to a result if he is aware that it is practically certain that his conduct will cause such a result. Computer Systems Engineering. Inc. v. Quantel Corporation. '.571 F.Supp. 1365 (D.Mass. 1983).
, "[Tjhe design of the competitive bidding statutes ...is to establish genuine and open competition after due public advertisement in the letting of contracts ...to prevent favoritism in awarding such

the

, (citation and internal quotation omitted).

was to protect the public." Commonwealth v. Gill. 5 Mass.App.Ct. 337, 363 N.E.2d 267 (1977)

contracts and to secure honest methods of letting contracts in the public interests. The main aim

"The Supreme Judicial Court stated in Interstate Engr. Corp .... two complementary legislative objectives underlying G.L. c. 149, ss 44A~-44L, which apply with-equal force to O.L. c. 30, s 39M. 'First, the statute enables the public contracting authority to obtain the lowest price for its work that competition among responsible contracts can secure,' and '(s)econd, the statue ,establishes an honest and open procedure, for competition for public contracts and, in so doing, places, all general contractors and subbidders on an equal footing in the competition to gain the contract." Commonwealth v, Gill. 5 Mass.App.Cl 337, 363 N.E.2d 267 (1977). "[AJ conspiracy need not be proved by direct evidence as it is elementary law that a 'conspiracy may be, and usually is, proved by circumstantial evidence.' Commonwealth v. Stasrnn. 349 Mass. 38,,50,206 N.E.2d 672,680 (1965). 'It is not essential to a conspiracy that parties meet Or " that they confer or formulate their plans. Common purpose may be inferred from concerted . : action converging to a definite end. Participation in the concerted action is necessary... It is not necessary that all the conspirators join in every part of the unlawful transaction; that the motives 'by which the several conspirators are actuated may be most diverse. The part each is to play, the reward or satisfaction to be received by each and the knowledge possessed by each of the scope and details of the affair, may be widely at variance.' Commonwealth v. Beal. supra, 314 Mass. at 221,223-224,50 N.E.2d at21. See Commonwealth v. Hoot. 4 Met. 111, 123, 45 Mass. 111 (1842,.,' Commonwealth v. Gill, 5 Mass.App.Ct. 337,363 N.E.2d 267 (1977).
2S

Counsel for Beverly admitted that the RFP is an ambiguous document. (Tr. 9-148). Of course, ·ambiguity in the RFP is construed against its drafter, Beverly. Bowser v. Chalifour. 334 Mass. 348,135 N.E.2d 643 (1956). .
G.L. Ch. 30B §17 requires that all contracts for more than $5,000 be in writing ..

O.L. ch. 30B § 17, in part, states: "a. All contracts in the amount of five thousand dollars or more shall be in writing ... c.... A person who causes or conspires with another to cause a contract to be solicited or awarded in violation of a provision of this chapter shall forfeit and pay to the appropriate governmental body a sum of not more than two thousand dollars for each violation. In addition, the person shall pay double the amount of damages sustained by the governmental ·body by reason of the violation, together with the costs of any action. If more than one person participates in the violation, the damages and costs may be apportioned among them." G.L. ch. 30B § 19 states: "Subject to the provisions of section one hundred and three of chapter forty-one, to the extent pennitted by charter or local by-law in a city or town, or by written rules of the committee, commission or executive appointing the chief procurement officer in a district or county, a.chief procurement officer may delegate his powers and duties in accordance with this section to one or more employees of the governmental body. A delegation sha1l be in writing, be signed by the chief procurement officer, and state the activity or function authorized and the duration of the delegation. A delegation may be in specific or general terms, may be limited to a particular procurement or class of procurements, may be conditioned upon compliance with specified procedures. A delegation may be revoked or amended whenever the chief procurement officer determines that revocation or amendment is ~ the best interests of the governmental body. A delegation of powers or duties by a chief procurement officer and any revocation or amendment thereof shall not take effect until a copy of the same has been tiled ·with the officer of the inspector genera1." .

and

Mayor Scanlon, as the chief executive officer of Beverly; is responsible for the omissions of the members of the Commission.

acts

and

"No Massachusetts· case has explicitly held that municipalities and government entities are not subject to suitunderG.L. Ch. 93A.u Bedrosian. LLC v. Costanza, 10 Mass.L.Rptr. (Mass.Super.1999) (Hj11man, J.). Where a "defendantmunicipality acts as a market participant, and engages in trade or commerce for its own benefit .. .liability for unfair and deceptive acts or practices in connection with that trade or commerce may lie." Bedrosian. LLC v. Costanza, 10 Mass.L.Rptr. (Mass.Super.1999)
(Hillman, J.).

An examination of the statute and the cases that have touched upon the issue of municipal liability under O:L. Ch. 93A shows that a municipality which engages in the conduct of trade or commerce for the purpose of producing a profit may be held liable under 93A. ... There is: no exception under Chapter 93A for actions taken by municipalities.

The burden is on the defendants

to show that they are exempted from the provisions and reach of O.L. Ch. 9.3A. Turner y. JOOman & Johnson, 549 F.Supp. 807 (D.Mass.1982); Slaney v.
26

Westwood Auto.

evidence in this regard.

me.. 366 Mass. 688,322

N.E.2d 768 (1975). The defendants offered no

Johnson and the Defendants are all legal entities that were engaged

commerce.

in the conduct

of trade or

Johnson has suffered damages as a result of the badfaith actions ofthC City of Beverly. The defendants were engaged in trade or commerce when they conducted the RFP process and awarded the contract to Friel. . Chapter 93A prohibits certain acts when done in the course of "trade or commerce" end, in a suit brought under section II of Chapter 93A, both parties must be engaged in "nade or commerce." A party engages in "trade or commerce" when it acts "in a business context." Howard, 427 .Mass. at 538; PeabodyN.E .. Inc. v. Marshfield. 426 Mass. 436, 439 (1998); Lantnerv. Carson. 374 Mass. 606,611 (1978). Whether a party is acting in a business context "must be d.etennined from the circumstances of each case." Begelfer v. NajarilUb 381 Mass. 177, 190"91 (1980). Among the factors assessed are "the nature of the transaction, the character of the parties involved, and the activities engaged iiI by the parties [and] whether similar transactions have been undertaken in the past, whether the transaction is motivated by business or personal reasons ... and whether the participant played an active part in the transaction." Id. at 191; Howard. 427 Mass. at 538; Peabody N.B .. Inc. v. Marshfield. 426 Mass ..at 439 n.6. The Supreme Judicial Court has recognized that a governmental entity may bring suit under G.L . . c. 93A, § 11. SPence v. Boston Edison Co., 390 Mass. 604,615-16 (1983) (Boston Housing Authority sued Edison alleging overcharging in a contract to provide steam. to apartments). Necessarily then, pursuant to the cases cited above and the language of section 11 defining who may bring suit, a governmental entity, including a city or town, may be a "person" that acts "in a business contest" by "engag[ing] in the conduct of ... trade or commerce. II . See Boston Housing Authority v. Howard, 427 Mass. 537,540 (1998) (discussing Spence and recognizing that, in that case, the BHA "was engaged in trade or commerce in contracting with Boston Edison"). A governmental entity, including a city or town, must therefore also be able to be sued under section 11 when the facts show that it was acting in a business context. . The Supreme Judicial Court's approach to these cases is also be dispositive ofBevedy's . .argument that it is exempted· from liability pursuant to section 3 of Chapter 93A. In any event, the case law also shows that Beverly's position is without merit. Thus, in Bretton v. State . Lottery Comm'n, 41 Mass.App.Ct. 736 (1996). the court held that activities of the State Lottery Commission are not exempt from 93A by virtue of section 3. lsi. at 739 n.7. Further, G.L. c. 30B, § 6, does not authorize the "transaction" as conducted by the defendants here. In fact, no law allows, much less authorizes, a city to manipulate the evaluation of bids; to use improper criteria when evaluating proposals; to arbitrarily rate. qualified bidders; or to generally act in bad .faith when awarding a contract. ~. rum v, United Van Lines. Inc., 903 F.Supp. 224, 232 (D. . . Mass.) 995) ("There is no regulation or agency that permits a common carrier to mislead its customers in the claims settlement practices"); rev'd on other grounds, 104 F.3d 502 (1st Cir. 1996).
27

conduct in disregard of known contractual arrangements and intended to benefits for the breaching party constitutes an unfair act or practice for c.93A purposes," Anthony's Pier Four. Inc .. et aI. v. HBC Asw>ciates. ct al .. 411 Mass. 451, 583 N.E.2d 806 (1991) (citations and internal quotations omitted). ,
U •••

secure

· Ignorance of the law is not an excuse or defense against its enforcement Vt:ermehle v. Norment, · 197 U.S. 40, 2S S.Ct.291 (1905); Bttan v. U.S .. .524 U.S. 1,84, 118 S.a. 1939 (1998). ·Statutes regulating public bidding have been in existence since the early 1900s. See Interstate Engineerine- CoIp. y. Fitchburg. 367 Mass. 751,329 N.E.2d 128, 132 n. 12 (1975) (I'he SUpreme Judicial Court, in citing cases decided in 1925, 1930 and 1931 noted that the cases were decided under a forerunner of the then present competitive bidding statutes). "The Ward Commission investigated corruption illthe awarding of public construction . contracts ..." LeClair v. Town of Norwell. 430 Mass. 328, 719 N.E.2d 464 (1999). The Ward Commission issued its:final report in 1980. Id. . .. ·ill Signed under the pains and penalties of perjury this" day of July, 2000.

CortlandA. Mathers,Mas~

c~a.m~

.

28

Sign up to vote on this title
UsefulNot useful