COMMONWEALTH OF MASSACHUSETTS

MIDDLESEX, ss.

UPERIOR COURT CIVIL ACTIO NO:

MICV2008-04641-B

JOHNSON GOLF MANAGEMENT, INC.

TOWN OF DUXBURY & OTHERS!

MEMORANDUM OF DECISION AND ORDER ON DEFENDANTS' MOTION FOR SUMMARY JUDGMENT

The plaintiff, Johnson Golf Management, Inc., brought this action against the defendants seeking damages and an injunction ordering the Town of Duxbury ("the town") to award it an operations contract. This matter 1 now before the court on the defendant town' Motion for Summary Judgment. For the follow mz reasons. the town'.' moll n 1 DE. lED, Moreover, the coui t rant .... a prelirmnur injuncuon eo r "tram the to \ 11 from

ex cutmz a c ntract for the operation of the. Jorth Hill Golf and 'ountry Club until the conclusion n this lit igation or further order of this court.

BACKGROUND

This ca e in 01 e a dispute over the right to operate the North Hill Golf and Country Club ("the golf course") in Duxbury. The golf course is owned by the town and had been operated b the plaintiff pur uant to an existing operation contract until December 31, 2008. In anticipation of the expiration of the contract, the town issued a Request for Proposals ("RFP") for the period January 1, 2009 to December 31, 2013. The town received five bids in response to this first RFP. The plaintiffs bid was for $420,000,00; another bid, from defendant Calm Golf, Inc., was for $280,000.00. After reviewing the proposals, the town announced that it was rejecting all of them on the basis that two of the three independent evaluator reviewing the propo a1. had not complied with the Criteria

I North Hill Advisory Committee, consisting of Michael Doolin, Chairman, Scott Whitcomb, Robert M. Mustard Jr., Michael Marlborough, Anthony Floreano, Michael T. Rufo, Thomas K. Garrity, Richard Manmng, W, James Ford, and Gordon Cushing (ex officio); Calm Golf, Inc.; and harles Lanzetta.

- 2 -

Evaluation Standard set forth in the RFP because they had failed to provide compo ite score for the proposals. '1 h tow n did not 1. • ue a writt n explanation of its deer lOll.

'I'h town .ub: cquent l r is tied a second RFP. Th onlv substantive change wa that

III t ad ot a Il1 ]. t ie bid In th 1'111 a a at pa ment t h c nd IU I

01 an HI1IlU .11 p11 III nt. Th j tov n again r 'C .. ived fi e bid, includin one from the plaintiff and one from alrn Golf. In Its bid. alrn Golf claimed t hav oxtensiv exp ric nee in mana Ting golf COUl"e " but in fact had onl ' managed on course. from. Iarcl to Augu t of 20 ::l JlI t f 110\\ ) 19 It mcor] oration Calm Golf al 0 . 1 orm th d f ndar t hat it h, d onlv ]()H.OO in as set at the time of it application, It al 0 had no equipment for th ope rat.ion and management of a golt COUI'. e.

Each of th e two bid received identical compo ite evaluation Citing the fact that this time alm Golfs rental hid wa: $92.500.00 higher than the plaintiff .. the town awarded the contract to Calm Golf. '1 he town manager, Richard Iacl lonnld, ha: d po red that he has onlv a ver r rmrnmal recollection of tlu proces: of the award, not recalling <11 t 11 of th ' d -cision-making pro e . or that the information lm Golf. ubmitt ed shov ed

limited a. sets.

The plaintiff fir t brought this action on December 12, 2008. On February 3, 2009, this court (Smith, J.) i' ued a preliminary injunction ordering that the plaintiff should continue' to manag thr golf club; thi: court then vacated this Older on October 25,2010.

DISCUSSION

Summary Judgment is appropriate where there are no genuine issues a to any material fact and where the moving party i entitled La judgment as a matter of law. Mas s. R. Civ, P. 56(c). A party mavin for ummary judgment in a case in which the oppo ing party will have the burden of proof at trial is entitled to summary judgment if it demonstrates that the oppo ing party has no reasonable expectation of proving an o ential element of it case. Kourouuacilis v. General Motors Corp., 410 Mas. 706, 716 (1991). The moving party bears the burden of affirmatively demonstrating the ab ence of a triable i sue; however, once thi burden is met, the opposing party must respond and allege

pecific facts that would ~ tablish th existence of a genuine i 'sue of material fact. Pederson v. Time, Inc., 404 1ass. 11, 17 (1989).

- 3 -

1. Right to ue Pursuant to G.L. c. 30B

Ab a thre hold i ','ue, the d fendant contend it is entitled to umrnary judgment as to the claims involving G.L. c. 30B (the Uniform Procurement Act or PA) because the UP"\ does not create a private cause of action and rather ve tits nforcern nt power. exclusively in the In pector General. ee G.L. c. 30B, § 17(d).

It is clear that the enforcement of the Uniform Procurement Act doe not lie exclusively in the hands of the Inspector General; a group of ten taxpayers may also challenge' the bidding proce: pur: uant to G.L. c. 40, § 53 • e Edu ards v. Boston, 408 Ma . 613, 645 (1990); c.f. Andrews v. Springfield, 75 Ma . App. Ct. 678, 68]-6 2 (2009) (G.L. c. "0, § 53 used by taxpayers to challenge municipal decision taken pursuant to c. 149,

44A-44L., the competitive bidding statute for con truction contracts).

Admittedly, the use of chapt r ·10 b taxpayers to achieve standing to bring suit against municipalities under the niform Procurement Act or competitive bidding tatute might be interpreted as imposing a similar requirement o~ aggrieved bidders, particularly in light of the fact that there is generally no equity jurisdiction to re train cities and towns from carrying out invalid contracts. Pratt v. Boston, 396 Mass. 37, 42 (1985). But c t I , t vith r card to the competitive bidding statute, "flexible tanding requirement ' ar the

rule Modern Continental Conet Co. v. Lou-ell, :i91 1(1!'<<::. H29, R:1f}-R;~6 HlR I); (..Jill/ICY

Orruunental /1'011 H'url~, Inc., '. Findl. 11, :~5;l r-.11l"'" 5 H7 (19()"') C'll i \ '('11 hcd that a bit rna conu a t governed 1)\' lr.L. c. 11~1, .: i4 -1-1L, has tnudmz to chall nee the complianc I of the a varding authoritv v ith the requirern .nts of tho • sections."). A Ithough the court, do not wi: h to encourag litigation of "p tty grievances,' they regard i idi -idua! hidd rs a Important 111 .ecuring compliance WIth the competitive biddinz

I atute lode n Continental, 891 • fa " at 86 n.9.

The question here is whether imilar policy con ideration hould permit a flexible standing requirement for chapter 30B, which was enacted after the decision of Modern Continental and Quincy Ornamental. Th ca the plain Iff cite, Bou man v. Dreu11Y,

ugg st that the h uld. ce 1 9 \ 'L 171 111 at *1 ( lass uper. W96 (, osrnan .1.), Bounnan, lightly diff ring from thi. ca .. e. involved both an aggri v d bidder and ten taxpayer , who brought their action through certiorari. Id. While it may have been po: sible for the L xpa I. alone t bring suit pursuant tc C.L. c. 40, § Ga, the f< t that the bidder

..

-

-4-

action as well suggests that aggrieved bidders have independent ndm T t j brrn r uit under t h

The town contends, inter alia. that. uch a result would nece sarily involve the second-guessing of town deci ions by the court and frustrate the role of the 1 ttorney General in enforcing the law. But a suitably deferential tandard of review will prevent courts from sub tituting their own judgments for those of municipal officials and confine them to their proper role of enforcing the provisions of the law. Moreover, Modern Continental makes clear that the courts are willing to tolerate a somewhat greater amount of litigation in order to further ultimate statutory objectives. 'I'hereforc, the court determine. that the plaintiff has standing to sue under the UPA.

2. Exercise of discretion under G.L. c. 30B

J<;ven if the plaintiff. has . tanding, the town argues it if: entitled to summary judgment. because the undisputed facts of this case demon trate its acceptance of Calm Golfs bid wa a valid exerci e of it di cretion under the UPA. \ 'hile the expres term of the PA do not state any standard of re iew of a chief procurement officer' selection of a

most udv untagcous proposal," it may be appropriate 0 invalidate an award wher evidence ugg sts that the decision demon trated a gros , abuse of discr tion. e) Bowman. H}C 6 WI. 17,18·1·1J at *11.

Undr-r the UP,\, a procurement officer must designate individuals responsible for evaluating bids on criteria other than price, and have them prepare their evaluation. based solely on the criteria set forth in the RFP. G.L. c. 30B, § 6. A municipal procurement officer may reject all bids for a contract, but only if the officer determines, in writing and in good faith, t hal the rejection serves the best interests of the community. See G.L. c. 30B, § 9.

'111 'p is sianificant evidence in the record to ugge. t that the defendant did not act 111 good faith 111 rejecting all ot the propo: al. pur .. uant to the fir: t RPF. In his 1\1 Hill 'll the t vn mana reI', Richard. Iacflonuld. stat that he rejected the initial bid b .. 'au e som > of th evaluators failed to upply composite scores in ac ordance WIth the initial RFP. But he do' ot of T' any explana 1011 \VII" he decided t'l 1'\.1JPC·( nil of the hid ruth. r than plIr uo the ob IOU" solution. which v 'as to a. k the evaluators to ubmit compo. ito scores. MOl" ov r, by failing to explain hIS r sasorung In writing, 1 IacDonald failed to meet the requirement set

- 5 -

forth by G.L. c. 30B. § 9, a fact that further suggests a rush to judgment to prevent the plaintiff from being awarded the contract.

There is also ('vidpllce in the record suggesting the defendant acted either arbitrarily, or in bad faith. in awarding the contract to ahn Golf pur uaut to the second RPF .. 'hile . taclronald has deposed that he fail. to remember the detail of the decisionmaking process regarding the award. it is und sputed that, at the time of the award, whatever its application rna I have purported, Calm ,oIf had only a few month 'experience managing golf courses, and possessed virt un ll no asset , including virtually no g-olf eqUIpment. Under the criteria set forth in both of the defendant's RFPs, these fact \\ auld }H\V • rendered 'aIm Golfs bid significantl r less appealing than the plaintiffs.

At the very least, the town had rea on to know about Calm Golfs lack of assets and equipment. That alone renders it a genuine issue of material fact whether it acted arbitrarily or in bad faith in awarding Calm Golf the contract. These questions should be

put to a jury.

3. Implied contract claims

Once a governmental organization has put a public contract out to bid with certain conditions, the submi sion of a bid on those conditions creates an implied contract obligating the solicitor to those conditions. New England Insulation Co. v. General. Dynamics Corp., 26 Mass. App. Ct. 28 30 (1988); sec Cataldo Ambulance Serv., Inc. v. Chelsea, 426 Ma s. 383, 388 n.7 (1998). The "failure to give fair consideration" to a bidder can result in an award of preparations costs, New England Insulation, 26 Mass. App. at 31, or, in the case of bad faith, 10 t profits. Peabody Const. Co., Inc. v. Boston, 28 Mass. App. Ct.

100, 105·J06 (1989).

The town argues that it is entitled to summary judgment because there is no c\'icipnce of bad faith on the part of the town manager. For the reasons discussed above, tho court hal' concluded that there is suffi('lent evidence of had faith on the part of the town manager to raise a triable issue, and so summary judgment against the plaintiffs irnph d

contract chums is inappropriate.

- 6 -

4. Violation of G.L. c. 93A

The town' alleged bad faith i ufficient to constitute "unfair or deceptive act" on the part of the town for liability to attach pur uant to G.L. c. 93A, § 11. That said, an entity can only be held liable under G.L. c. 93A if it was engaged in trade or commerce, which in turn requires that it have acted "in a business context." Boston Housing Auth. v. Howard,

427 Mass. 537, 538 (1998).

A municipality is not acting in a busine context where its sale motivation for

entering into a contract 1 to perform it mumcipal re pon ibilities, such a keeping order in the street , Park Drive Towing, Inc. v. Revere, 442 Mas . 80, 86 (200tj), or town administration, M. O'Connor Contracting, [nco V. Brockton, 61 Mass. App. Ct. 278, 285 (2004). Moreover, a governmental entit doe not act in a business context where its action was required by 1 gi lative mandate or where it ha no profit motive. Houiard, 427 Ma s. at

539.

• [on of these situation" applies IH re: tht:! to\\ n's prrmary motivati n or lea ing the golf course 1 to .nrn a profit; its ownership of the golf course has not been mandated b the k-gislnt uro; nnd its ownership is not linked to an of its core municipal responsibilities. While h S.J( has stnll 11('\,('1' dpcidf'C( whether municipalities engaged in trade or cornrn rce ar amenable 0 uit under (1.L. C. 93A, 11. 1'Ll' Call '1. Corp. V. A. ntlionv Tappe &

S ocs., lnc.. l las: \PI. ( .1,]3 n.IO (199!J) how v r, It tand .. to r c on that had the 'i hed to carve out an .xernp ion [or municipahtie , independent of the busine .ont . t' requirement, it could have don ,0 already on any numb '1' of occasions. In the abs nee of dcfinit.ive guidance from the appellate courts, this court will not conclude that municipaht.ie acting in a )u, me ~ cont xt Hl'p not amenable to 931 suits,

The town neverthele argue that it i exempt from liability because it actions

were "otherwi e permitted under laws as administered by any regulatory board or officer acting under statutory authority of the commonwealth ... " G.L. C. 93A, § 3. The burden lies on the defendant to prove the exemption. Id. To sustain a section three defense, a defendant must show more than the mere existence of a related or even overlapping regulatory scheme that covers the transaction, Fleming V. National Union Fire Ins. Co., 445 Ma '. 381, 390 (2005). Rather, the cherne mu t affirmatively permit the practice which i alleged to be unfuir or deceptive. Id. The uncontested facts of this case fail to demonstrate

- 7 -

that any legislative or regulatory scheme affirmative 1 . permitted the town's behavior, so the defendant have failed to establi b they are entitled to judgment on this count.

5. Preliminary injunction

DUl ina th h arina of thi: motion, the TO\'n emphatically informed thi Court tha It intended to r bi the contract now that the pr 11n11na1'Y injunction J~. ued Februar 3, 2 10, h ::, b n vucared. It \ U' not th curt's int muon, however, to p irmir the to vn to aw rd. contrac to another company during the pendency of thi action and, th ~r by, In atly cornph 'ate it ability to grant permanent injunctive r li f, if ap roprrt to, foIl \\ 1lI the conclusion of this ns '. Con cquently, thi: court h reby rein, tate' the preliminary injunction tho t it is uerl on February :i. 2010, a. sot out br-l \ , and minin: th defendant from executing a n w contract for the operation of the North Hill Golf, ncl ( ountr r 'luh until the conclu 'JOn of this litigation or further order of this court.

ORDER

1. For the rea, on tated above th d fendants' Motion for umrnary Judgment i ..

DENIED.

2. it is hereby ORDERED that the defendant, Town of Duxbury. is enjoined from executing a contract for the operation of the North Hill Golf and ountry lub until the conelu ion of thi liti ation or further order of thi court. Thi Order does not forbid the Town of Duxbury from rebidding the contract.

3. It is hereby ORDERED that the plaintiff Johnson Golf Management, Inc.' Renewed Application for Injunctive Relief seeking a temporary order requiring that defendant Town of Duxbury continues to permit plaintiff John, on Golf Management, Inc, to manage the North Hill Country Club and Golf Course pending the resolution of thi matter is that thi Court vacated shall now be REI TSTATED and LLOWED a follow:

a. it 1 ORDERED that plaintiff John on Golf Management, Inc., shall continue to manage the orth Hill Countr ' Club and Golf Cour se until such a time a the above caption matter is resolved or until further order of thi Court;

-8-

b. Furthermore, except for it December 31, 200 , expiration date, it is ORDERED that the term and condition of the previou mana ement contract, pur. uant to which plmntiff John on Golf lIanagement, Inc. managed the orth HIll County Club and Golf Our 'e, < hall remain in place and in force until the re olution of the above captioned ea e or until further order of thi curt.

c. Th '200,000.00 ecurity that thi

ourt ORDERED Johnson Golf

Isnagcmom Inc. to post by an order dated Nov rnb r .1, 20J 0 r mains in eff ct for th duration of thi preliminary injunction or until further order of thi:-; Court.

4. The partie hall fil proposed deadline [or the completion of diHcov'I'Y and

scheduling of a trial date within ~O days of the date of this ORDER.

D TED:

November 24, 2010

By the Court

Ju

F ,1 D 1('.' SI'P( ,,' L ~':J;S (' 'I IW1GI' (1\'11 -20 ](J\JOII 'so,' GOl.f ,1.\. '\(;P. !E 'T,!. '(' v TOW.' OF III XB[ 'II ~', L ~!H'\'20()1l 04G41·!l llEr"SRL.l.r:5G. Don

Sign up to vote on this title
UsefulNot useful