Air Conditioning Inc. v.

Small
Supreme Court of Alabama, 1953
Judge Bates:

Facts: Air Conditioning Inc. (defendant) bid a job for Small (plaintiff) that was an alteration of the
Alabama State Docks Commission office building. The defendant’s quote included HVAC and louvers,
and the defendant became the apparent low bidder with a price of $35,851. The following month, the
architect informed the defendant that their bid was not in accordance with the plans and specifications,
per the instructions to bidders. One of the manufacturers, Carrier, did not meet the architect’s standards,
so the defendant requested to withdraw their name from consideration. Plaintiff responded by saying that
the defendant’s bid had already been used in the contractor’s general bid, and it was thus the obligation of
the defendant to fulfill the obligation of their contract. Further, since the plaintiff stated that the defendant
would no longer be able to perform the work, the defendant held the burden to pay the difference between
the defendant’s low bid and the second-lowest bid, which totaled $2,766, and the plaintiff would likely
contract that second-lowest bidder for the job. The plaintiff filed suit and the judgement was ruled in
favor of the plaintiff. The defendant appealed.

Issue 1: Was plaintiff’s bid acceptance and subsequent informing of the defendant of his low bid an
enforceable contract?

Holding: No

Rationale: The defendant acknowledged in his bid that he complied with all plans and specs. The plaintiff
responded to that bid, which was the low bid, by informing the defendant that he was awarded the job.
The enclosed document specified that the defendant must comply with the specifications. Since Carrier
was not an approved manufacturer by the architect, it was thus not compliant with the specifications.
Therefore, the plaintiff’s letter to the defendant effectively was a counteroffer, not an acceptance. The
defendant was unable to convince the architect to accept Carrier as a manufacturer, so the defendant
effectively denied the counteroffer and withdrew its bid. There was no meeting of the minds, and the
judgement was thus ruled in favor of the defendant under the grounds that there was no enforceable
contract.