IN RE PROTEST OF CONTRACT AWARD FOR PROJECT A1150-18, ETC. (DIVISION OF PROPERTY MANAGEMENT AND CONSTRUCTION)

NOT FOR PUBLICATION WITHOUT THE
APPROVAL OF THE APPELLATE DIVISION
SUPERIOR COURT OF NEW JERSEY
APPELLATE DIVISION
DOCKET NO. A-1193-19T1
IN RE PROTEST OF
CONTRACT AWARD FOR APPROVED FOR PUBLICATION
PROJECT A1150-08, N.J.
EXECUTIVE STATE HOUSE February 2, 2021
COMPREHENSIVE APPELLATE DIVISION
RENOVATION AND
RESTORATION
_____________________________
Submitted January 6, 2021 – Decided February 2, 2021
Before Judges Sumners, Geiger and Mitterhoff.
On appeal from the New Jersey Department of
Treasury, Division of Property Management and
Construction, Project No. A1150-08.
Hedinger & Lawless, LLC, attorneys for appellant
Hall Construction Co., Inc (Robert T. Lawless, on the
briefs).
Gurbir S. Grewal, Attorney General, attorney for
respondent New Jersey Division of Property
Management and Construction (Melissa H. Raksa,
Assistant Attorney General, of counsel; Beth L.
Mitchell, Assistant Attorney General and Vivek N.
Mehta, Deputy Attorney General, on the brief).
Stevens & Lee, PC, attorneys for respondent Daniel J.
Keating Company (Maeve E. Cannon and Patrick D.
Kennedy, of counsel and on the brief; Michael A.
Cedrone, on the brief).
Peckar & Abramson, PC, attorneys for amicus curiae
Associated Construction Contractors of New Jersey
(Charles F. Kenny, on the brief).
The opinion of the court was delivered by
GEIGER, J.A.D.
Hall Construction Co., Inc. (Hall) appeals from the November 15, 2019
final agency decision of the New Jersey Division of Property Management and
Construction (DPMC) rejecting Hall's bid protest and awarding the contract for
the Comprehensive Renovation and Restoration of the New Jersey Executive
State House, DPMC Project No. A1150-08 (the Project), to respondent Daniel
J. Keating Company (Keating), the lowest bidder. The appeal presents an
issue of first impression—whether a prime contractor bidder is required to
name its building control systems subcontractor in its bid. For the following
reasons, we dismiss the appeal as moot and also determine that Hall's
arguments lack merit.
I.
We discern the following facts from the record. DMPC solicited
competitive bids for the comprehensive renovation and restoration of the
Executive State House in Trenton. Final specifications for the project were
issued on August 20, 2019. Following several rounds of bidder questions,
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DMPC issued clarifications and amendments to the specifications. DPMC
then advertised for sealed bids for the Project. The advertisement stated:
In accordance with N.J.S.A. 52:32-2, this project shall
be bid as a single bid (lump sum all trades). Bidder
must be classified themselves or name their classified
sub-contractor(s) for the following trade(s):
Structural Steel (C029)
Plumbing (C030)
HVACR (C032)
Electrical (C047)
Failure to list classified sub-contractors will deem the
bid non-responsive.
DPMC opened electronic bids for the Project on September 17, 2019.
Three bids were received. Keating's bid of $199,498,000 was the lowest.
Hall's bid of $205,777,000 was the second lowest. Tutor Perini Building
Corp.'s bid of $211,777,000 was the third lowest. Thus, Hall's bid was
$6,279,000 higher than Keating's.
Both Keating and Hall used DMPC's bid proposal form (Bid Form). The
Bid Form required bidders to identify the names and addresses of each
subcontractor who would be performing certain classified trade works on the
Project. This included identifying each subcontractor performing "HVACR 1
(C032) – Mechanical" and "HVACR (C032) – Duct Work." In addition, each
1
"HVACR" refers to heating, ventilating, air conditioning, and refrigeration.
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subcontractor listed on the Bid Form was required to be classified by DMPC
for their trade at the time of the bid. Thus, subcontractors performing HVACR
mechanical and HVACR duct work were required to be classified as HVACR
(C032) contractors at the time of the bid. Notably, the Bid Form did not
require bidders to identify subcontractors performing "C043 – Control
Systems" work.
The day after the bid opening, Hall lodged its initial bid protest,
contending that Keating's bid must be rejected and the contract awarded to
Hall because: (1) Keating's named HVACR mechanical subcontractor, Devine
Brother's, Inc. (Devine), exceeded its DPMC aggregate classification rating;
and (2) a notary public with an expired commission notarized Keating's bid
bond. Hall sent three subsequent letters to DPMC that provided further
information about Devine and reaffirmed its argument that Keating's bid bond
was deficient.
DPMC requested Keating provide documentation of Devine's
uncompleted work as of the time of the bid opening. Keating contested Hall's
protest and provided the requested information, including certifications from
Keating's and Devine's respective presidents.
On October 7, 2019, DMPC issued a decision rejecting Hall's claims and
declaring DPMC's intent to award the Project to Keating. DMPC found that
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Devine did not exceed its aggregate classification rating and that Keating's bid
bond was not deficient as the notary's public's commission was still valid and
in effect when the bid was notarized.
On October 11, 2019, Hall lodged a second bid protest that raised a new
ground for rejection. Hall claimed Keating's bid was deficient because it
failed to name the subcontractor it intended to use for the building control
systems work, which must be performed by a DPMC classified C043 – Control
Systems contractor. Hall contended that N.J.S.A. 52:32-2 requires bidders to
identify on their Bid Form the subcontractors performing all possible facets of
HVACR work, including subcontractors performing C043 – Control Systems
work. Hall asserted that control systems work qualified as HVACR work.
On October 17, 2019, DPMC issued a second decision rejecting Hall's
claim that Keating submitted a deficient bid. DPMC found that the Bid Form
did not require bidders to identify subcontractors performing C043 – Control
Systems work. It noted that C043 – Control Systems work is not included
within the "umbrella trades" that classified HVACR contractors may perform.
DMPC explained that "[i]t was neither a requirement of the bid nor the intent
of DPMC to require bidders to identify a [c]ontrol [s]ystems subcontractor on
this project." Hall requested a hearing to present its arguments.
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The hearing was held before Hearing Officer Wayne J Martorelli on
October 30, 2019. No witnesses testified. Hall and Keating abandoned their
respective objections to the form of each other's bid bonds.
In support of its position that control systems fell under HVACR work,
Hall argued: (1) Section 230900 of the Project specifications, which detailed
the work to be performed by C043 – Control Systems subcontractor, was listed
under Division 23 of the specifications, labelled "HVAC"; and (2) the
regulations of a different State agency, promulgated under the HVACR
contractor licensing statute, defines HVACR work to include "pneumatic air
and/or direct digital controls." N.J.A.C. 13:32A-1.2. Keating maintained that
Devine had not exceeded its DPMC aggregate classification. It also argued
that modern-day control systems work was a distinctly different trade from
HVACR work and that it was not required by N.J.S.A. 52:32-2 to identify its
building control system subcontractor.
On November 15, 2019, Hearing Officer Martorelli issued written
proposed findings and a recommendation to reject Hall's claims that Keating
submitted a deficient bid. He found that "Keating's bid proposal identified two
HVACR subcontractors: Bonland Industries, Inc. [(Bonland)], to perform the
duct work at a price of $5,000,000, and Devine, to perform the mechanical
work at a price of $10,000,000."
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The hearing officer noted the following undisputed facts: (1) Devine's
HVACR mechanical subcontract price and Bonland's HVACR duct work
subcontract price did not include installation of the building control systems
described under Section 230900 of the specifications; (2) Keating planned to
enter into a subcontract with a subcontractor duly classified in the control
systems work trade to install the building control systems; and (3) Keating
excluded the control systems work from Devine's work scope to keep the value
of Devine's current uncompleted work below a $15 million aggregate rating.
The hearing officer noted that Keating estimated the value of the
building systems control work at roughly $2.5 million, such that inclusion of
this work within Devine's mechanical subcontract would—when combined
with its existing backlog of uncompleted work—exceed Devine's aggregate
rating. Keating's exclusion of the control systems work from Devine's work
scope is referred to "de-scoping," which is "a well-accepted practice in the
industry." Hall did not argue that it was per se unlawful for Keating to reduce
the scope of Devine's HVACR work.
Instead, Hall argued that Keating's intent to award the building control
systems work to an unnamed subcontractor violated N.J.S.A. 52:32-2 because
the control systems work fell under HVACR work and needed to be completed
by a named HVACR subcontractor pursuant to N.J.S.A. 52:32-2(b)(2). In
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response, Keating argued that the control systems work was not HVACR work
"but rather work belonging to an entirely separate and distinct specialty trade."
Keating intended to award the control systems work to a subcontractor
classified by DPMC under the control systems trade classification.
The hearing officer explained that DPMC recognizes control systems,
which require a different skill set and experience, as a separate and distinct
trade apart from HVACR. He noted that Section 230900 of the specifications,
which is 111 pages long, "describes a sophisticated, complex, and highly
technical computerized and web-based control system, installation of which
requires a level of specialized expertise, outside of the origins of the HVAC
trade."
To emphasize the complexity of control systems work, the hearing
officer also referenced the several qualification requirements for the control
systems subcontractor listed in Section 230900. For example, Section 230900
requires the control systems subcontractor to have the sole and primary
business of "designing, installing, and maintaining HVAC [c]ontrol Systems."
It also requires the control systems subcontractor to be: (1) "a factory
authorized [and] licensed representative for [the] Building Management
System (BMS) manufacturer"; (2) "a fully certified [and] recognized
installer/service provider by the [(BMS)] manufacturer"; and (3) "responsible
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for the [c]omplete installation and proper operation of the control system" and
collaboration with related trades. Lastly, the Responsibility Matrix included in
Section 230900 demonstrates the responsibilities of the control systems
subcontractor relative to the "Division 23 Mechanical [HVACR] Contractor"
and the "Division 26 Electrical Contractor."
The hearing officer concluded that "Section 230900 clearly reflects the
understanding that Building Control work is considered to be a stand-alone
trade, separate and apart from HVACR." He reasoned that "[i]f the [control
systems] work was intended to be performed under the supervision and control
of the HVACR subcontractor, [Section 230900] would have said as much,
rather than treating them as two separate and co-equal subcontract trades."
In addition, the hearing officer flatly disagreed with Hall's contention
"that the [b]uilding [c]ontrol [systems] work must be deemed to be within the
ambit of work which must be performed [by] one of the HVACR
subcontractors named in the bid because Section 230900 is placed within
Specification Division 23 – HVAC." He explained that "[a]s a matter of
standard industry practice, construction contract specifications are organized
according to a numbering system" known as Masterformat,2 which "provides a
2
Masterformat is a "system devised and regularly updated by a trade group,
the Construction Specifications Institute."
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uniform approach to organizing specification[s]" within sections of project
manuals. The hearing officer pointed out that the Masterformat's preface
specifically warns that:
Masterformat's organizational structure . . . does not
imply how the work is assigned to various disciplines,
trades, or subcontractors. Masterformat is not
intended to determine which portions of the project
manual are to be prepared by a particular discipline.
Similarly, it is not intended to determine what work
required by the project is the responsibility of a
particular trade.
For these reasons, the hearing officer found that the inclusion of Section
230900 within Division 23, which is labeled HVAC, was not meant to imply
that the control systems work must be performed by a HVACR subcontractor.
Instead, "Section 230900 clearly reflects the understanding that Building
Control work is considered to be a stand-alone trade, separate and apart from
HVACR." Thus, the control systems work "belongs to a separate trade, and
. . . Keating may award that work directly to a subcontractor classified under
C043-Control Systems, without violating the requirements of the bidding
statute." The hearing officer determined that "the only work that must be
performed by one of the identified HVACR subcontractors is limited to that
work which a classified HVACR contractor is entitled to self-perform under
classification C032." He emphasized that HVACR classified subcontractors
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cannot perform control systems work since it falls within the province of a
separate trade classification.
The hearing officer also rejected Hall's contention that HVACR
licensing laws support its position, explaining:
The definition of HVACR in the licensing statute does
not include any language which could be remotely
understood to include computerized building control
systems. . . . As such, even if the regulations adopted
under the licensing statute might be understood to
require a HVACR license to perform such work, the
enabling legislation does not. Even if it did,
moreover, there is nothing in the law which suggests
that the statutory HVACR licensing scheme was
meant to supersede or override DPMC's authority to
establish and enforce trade classifications[,]which
serve the public interest by limiting bidding in a trade
to contractors with the applicable expertise and
experience.
He concluded that "the plain language of N.J.S.A. 52:32-2 . . . only
requires the listing of work by subcontractor(s) who[] are installing the actual
HVACR system and not the more specialized work of installing building
management controls." He reiterated that "N.J.S.A. 52:32-2 dates back to
1915, decades before sophisticated building control systems that are the
subject of this protest were invented." Instead, N.J.S.A. 52:32-2 only requires
bidders to name subcontractors for "the steam and hot water heating and
ventilating apparatus, steam power plants and all work kindred thereto."
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The hearing officer also rejected Hall's argument that Devine exceeded
its aggregate DPMC rating. He found that the award of the HVACR
mechanical work would not cause Devine to exceed its $15,000,000 aggregate
rating when combined with its backlog of existing work.
DPMC Director Christopher Chianese issued a November 15, 2019 final
agency decision accepting and adopting in full the hearing officer's proposed
findings and conclusions and affirming his recommendation to reject Hall 's bid
protest. The Director stated that Hall's bid protest was rejected and the Project
"shall be awarded to [Keating]." Hall immediately requested a stay of the
contract award pending appeal, which DPMC denied the same day. The
Director found that Hall could not "satisfy [the] exacting standard for
injunctive relief" adopted by our Supreme Court in Crowe v. DeGioia, 90 N.J.
126, 132-34 (1982). DPMC then issued a Notice to Proceed to Keating to
begin work on the Project.
On November 18, 2019, Hall moved for leave to appeal, acceleration of
the appeal, and an emergent stay of the contract award. On the same day, we
granted Hall leave to file the motion and granted a temporary stay of the
contract award. On December 4, 2019, we denied Hall's motions for a stay
pending appeal and to accelerate the appeal. Five days later, we vacated the
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temporary stay. We granted the Associated Construction Contractors of New
Jersey's (ACCNJ) motion to appear as amicus curiae.
Keating subsequently moved to dismiss the appeal and DPMC moved for
summary disposition. Hall moved to supplement the record. We denied all
three motions but preserved Keating and DPMC's right to raise and brief the
issue of mootness. Keating has been working on the Project since the
temporary stay was vacated over thirteen months ago.
Hall raises the following points for our consideration:
POINT I
THE MERITS OF HALL'S APPEAL SHOULD BE
CONSIDERED DESPITE HALL'S PREVIOUS
REQUEST FOR A STAY OF THE CONTRACT
AWARD HAVING BEEN DENIED.
POINT II
DPMC'S DECISION WAS ARBITRARY AND
CAPRICIOUS AS IT WAS CONTRARY TO THE
PLAIN LANGUAGE OF THE STATUTE, OTHER
RELEVANT STATUTES[,] AND IGNORED
HIGHLY RELEVANT EVIDENCE.
II.
Appellate courts have "a limited role" in the review of a final decision of
an administrative agency. In re Stallworth, 208 N.J. 182, 194 (2011) (quoting
Henry v. Rahway State Prison, 81 N.J. 571, 579 (1980)). Final agency
decisions will be upheld unless the decision is "arbitrary, capricious, or
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unreasonable," or "not supported by substantial credible evidence in the record
as a whole." Ibid. (quoting Henry, 81 N.J. at 579-80). In determining whether
agency action is arbitrary, capricious, or unreasonable, we must examine:
(1) whether the agency's action violates express or
implied legislative policies, that is, did the agency
follow the law; (2) whether the record contains
substantial evidence to support the findings on which
the agency based its action; and (3) whether in
applying the legislative policies to the facts, the
agency clearly erred in reaching a conclusion that
could not reasonably have been made on a showing of
the relevant factors.
[Ibid. (quoting In re Carter, 191 N.J. 474, 482-83
(2007)).]
"The burden of demonstrating that the agency's action was arbitrary, capricious
or unreasonable rests upon the person challenging the administrative action."
In re Arenas, 385 N.J. Super. 440, 443-44 (App. Div. 2006) (citing McGowan
v. N.J. State Parole Bd., 347 N.J. Super. 544, 563 (App. Div. 2002)).
The reviewing court "may not substitute its own judgment for the
agency's, even though [it] might have reached a different result." Stallworth,
208 N.J. at 194 (quoting Carter, 191 N.J. at 483). "This is particularly true
when the issue under review is directed to the agency's special 'expertise and
superior knowledge of a particular field.'" Id. at 195 (quoting In re Herrmann,
192 N.J. 19, 28 (2007)). The Appellate Division must "defer to an agency's
technical expertise, its superior knowledge of its subject matter area, and its
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fact-finding role." Futterman v. Bd. of Review, Dep't of Labor, 421 N.J.
Super. 281, 287 (App. Div. 2011) (quoting Messick v. Bd. of Review, 420 N.J.
Super. 321, 325 (App. Div. 2011)). Furthermore, an "agency's interpretation
of statutes and regulations within its implementing and enforcing
responsibility is ordinarily entitled to" deference. E.S. v. Div. of Med.
Assistance & Health Servs., 412 N.J. Super. 340, 355 (App. Div. 2010)
(quoting Wnuck v. N.J. Div. of Motor Vehicles, 337 N.J. Super. 52, 56 (App.
Div. 2001)).
Deference is particularly appropriate when the "agency's expertise and
superior knowledge of a particular field" is involved, Greenwood v. State
Police Training Ctr., 127 N.J. 500, 513 (1992), including its reasonable
statutory "construction in recognition of the agency's expertise," TAC Assocs.
v. N.J. Dep't of Envtl. Prot., 202 N.J. 533, 544 (2010) (citation omitted).
"When resolution of a legal question turns on factual issues within the special
province of an administrative agency, those mixed questions of law and fact
are to be resolved based on the agency's fact finding." Campbell v. N.J.
Racing Comm'n, 169 N.J. 579, 588 (2001). Nevertheless, we are not bound by
an agency's strictly legal determinations. A.B. v. Div. of Med. Assistance &
Health Servs., 407 N.J. Super. 330, 340 (App. Div. 2009) (quoting Levine v.
State Dep't of Transp., 338 N.J. Super. 28, 32 (App. Div. 2001)).
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III.
We first address whether the appeal is moot. Hall argues that the
Appellate Division should consider the merits of this appeal notwithstanding
our decision denying Hall's emergent appeal to stay the contract award. Hall
contends that, absent resolution, the issue of statutory interpretation regarding
public bidding will likely reoccur. Hall notes that the issue involves the
"interpretation of the 'subcontractor naming' statute, which is implicated in
virtually all public bids." It further asserts that "[a]lmost all governmental
entities in this State have bidding laws which require the naming of
subcontractors in the bid."
DPMC argues that Hall's appeal is "moot because the contract award has
already been made, performance of the Project is well under way, and
substantial expenditures of time and resources have been incurred by the State
and Keating." DPMC also contends that this appeal "presents no recurring
question of public importance that might otherwise evade judicial review ."
Similarly, Keating argues that Hall's appeal is moot because the contract
award has already been made and Keating has performed substantial work.
Keating notes that any order to rebid or award the uncompleted portion of the
Project to another bidder or otherwise interrupt the construction "would be
completely untenable for the State in added cost, loss of warranty coverage
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and most importantly, potential damage and irreparable harm to the historic
State House due to work delay, loss of progress, weather impact, and change
of contractors." In addition, Keating argues that the DPMC's decision is
entitled to deference and that this appeal does not present an issue capable of
repetition while evading review.
"Moot or academic appeals are generally dismissed." Advance Elec. Co.
v. Montgomery Twp. Bd. of Educ., 351 N.J. Super. 160, 166 (App. Div. 2002)
(citing Cinque v. N.J. Dep't of Corrs., 261 N.J. Super. 242, 243 (App. Div.
1993)). "[A] court will not decide a case if the issues are hypothetical, a
judgment cannot grant effective relief, or there is no concrete adversity of
interest between the parties." Ibid. (citing Anderson v. Sills, 143 N.J. Super.
432, 437 (Ch. Div. 1976)). It is the policy of this State to refrain from
rendering advisory opinions or exercising jurisdiction in the abstract. State v.
Abeskaron, 326 N.J. Super. 110, 117 (App. Div. 1999). Nevertheless,
"[c]ourts occasionally will rule on such matters where they are of substantial
importance and are capable of repetition while evading review." Advance
Elec., 351 N.J. Super. at 166 (citing Mistrick v. Div. of Med. Assistance and
Health Servs., 154 N.J. 158, 165 (1998); Zirger v. Gen. Accident Ins. Co., 144
N.J. 327, 330 (1996)). In that regard, an issue that implicates the public
bidding process may be a matter of great public interest. Id. at 167.
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However, "[c]ontractual matters in which the State and its public entities
engage must proceed with alacrity." Barrick v. State, Dep't of Treasury, 218
N.J. 247, 264 (2014). To that end, "[t]he State's business and the public
interest in the State's contractual endeavors should not be unreasonably
delayed while an unsuccessful bidder seeks another level of review." Ibid.For example, in Statewide Hi-Way Safety, Inc. v. N.J. Dep't of Transp.,
we dismissed as moot an appeal challenging the award of a highway
construction contract because the project was "substantially completed." 283
N.J. Super. 223, 226 (App. Div. 1995). In that case, we had denied the
appellant's emergent application to stay the contract award and later, during
oral argument, discovered that a substantial portion of the project had already
been completed. Id. at 225. We recognized that it was "too late to order
rebidding or to award the contract to another bidder" because any order to
terminate the project "would be contrary to the public interest." Ibid.Consequently, we dismissed the appeal as moot but, nevertheless, addressed an
issue raised on appeal because of its public importance. Id. at 226 (citations
omitted). In addressing the remaining issue, we acknowledged the purpose of
public bidding laws and the policy of strict compliance with both the
substantive and procedural requirements of bid advertisements and
specifications. Id. at 230-31. We held that the agency's failure to read the
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elements of the bid constituted a material deviation from the governing statute
and that a party with standing could, in the future, prevail under similar
circumstances. Id. at 232.
Similarly, in Advance Electric, we considered the merits of an otherwise
moot appeal even though the project had been completed. 351 N.J. Super. at
166-67. There, the unsuccessful bidder, a primary contractor, challenged the
award of a public-school contract because there were no regulations governing
subcontractor qualifications. Id. at 163. We concluded that the issue was
capable of "frequent recurrence" until either the State Department of Education
adopted regulations concerning subcontractor qualifications or judicial review
of the issue. Id. at 167. We explained that, given the time it takes to hear and
decide appeals, "future appeals on the same issue would not be decided until
the construction was completed." Ibid."When a party seeks review of the award of construction contracts for
projects of the type involved here, the attack must be made with the 'utmost
promptitude.'" Richardson Eng'g Co. v. Rutgers, State Univ., 51 N.J. 207, 219
(1968) (quoting Bullwinkel v. City of E. Orange, 4 N.J. Misc. 593 (Sup. Ct.
1926)). Thus, "[w]henever public money is to be expended or if the successful
bidder has made substantial preparations for the work, incurred considerable
expenses and obligated himself still further in undertaking to carry out the
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contract, ordinarily, review of the award will be denied unless sought
promptly." Ibid. (citations omitted).
Here, unlike in Richardson Engineering, Hall's first protest promptly
challenged the award of a public construction project. Id. at 219. On the same
day that DPMC issued its final agency decision, Hall requested that DPMC
stay its contract award to Keating pending appellate review. After DPMC
denied the request, Hall swiftly moved for leave to file an emergent motion to
stay the award and accelerate its appeal. Just a few days later, Hall filed this
appeal.
On the other hand, Hall failed to satisfy the necessary factual and legal
basis for a stay of the contract award under Crowe, 90 N.J. at 132-34. As a
result, the Project commenced and continued while this case has been pending.
The record on appeal includes the certifications of Craig Hunt, Keating's
Director of Construction, and Raymond A. Arcario, the Executive Director of
the New Jersey Building Authority. 3 They establish that Keating has already
spent millions on the Project in preparation, demolition, renovation, and
construction and has obligated itself still further. Keating has issued at least
thirty-six subcontracts at an approximate total value of $161,000,000 for
3
Pursuant to Rule 2:5-4(a), the certifications, which Keating filed in support
of its motion to dismiss the appeal, are part of the record on appeal.
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various trade works and nine purchase orders through May 2020. It has
completed an estimated $10,245,000 worth of work on the Project by that date.
Work continued thereafter at a substantial pace. Terminating Keating from the
project would subject the Executive State House to risk of damage and
generate significant additional costs to mitigate those risks.
Aside from the substantial work on the Project already performed by
Keating and its numerous subcontractors and the large sums expended by
Keating, the record demonstrates that setting aside the award of the contract
would severely impact the Executive State House, jeopardize the work already
completed, the Project in general, and risk damage to this historical structure.
At this juncture, it would be "contrary to the public interest to void the
contract already awarded even for any remaining uncompleted portion of the
. . . construction." Statewide Hi-Way Safety, 283 N.J. Super. at 232. Because
the Project has proceeded so far, the equities weigh heavily "against the
provision of relief on the merits." Barrick, 218 N.J. at 264.
For these reasons, it is simply "too late to order rebidding or to award
the contract to another bidder." Statewide Hi-Way Safety, 283 N.J. Super. at
225. Given these uncontroverted and compelling circumstances, "we must
dismiss the appeal as moot." Id. at 226.
IV.
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We may, nonetheless, address the issue raised by Hall if we deem it to
be of sufficient public importance. Ibid. Statutory interpretation in public
bidding disputes can be "a matter of great public interest." Advance Elec., 351
N.J. Super. at 167. Because the issues raised in this appeal arguably involve a
matter of public importance that is "capable of repetition while evading
review," and for sake of completeness, we will address the merits of Hall's
claims. Abeskaron, 326 N.J. Super. at 117 (citations omitted).
We find no merit in the arguments raised by Hall in this appeal. We
conclude that the DPMC's final decision is not arbitrary, capricious, or
unreasonable and is supported by substantial credible evidence in the record as
a whole. The record amply supports Hearing Officer Martorelli's
comprehensive and well-reasoned proposed findings and conclusion, which
were accepted and adopted in their entirety by DPMC. Applying our
deferential standard of review, we discern no factual or legal basis to overturn
the DPMC's final decision.
N.J.S.A. 52:32-2 governs the advertisement and bidding procedures for
construction projects involving state buildings that exceed $2000. The statute
permits separate plans and specifications for:
(1) the plumbing and gas fitting and all work kindred
thereto; (2) the steam and hot water heating and
ventilating apparatus, steam power plants and all work
kindred thereto; (3) electrical work; (4) structural steel
A-1193-19T1
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and ornamental iron work; and (5) general
construction, which shall include all other work and
materials required for the completion of the project.
[N.J.S.A. 52:32-2(a) (emphasis added).]
In turn, N.J.S.A. 52:32-2(b) permits DPMC to advertise for bids for a "single
over-all contract, in which case there shall be set forth in the bid the name or
names of all subcontractors to whom the bidder will subcontract for the
furnishing of any of the work and materials specified in" N.J.S.A. 52:32-
2(a)(1) to (4). Each subcontractor for the four trades enumerated in N.J.S.A.
52:32-2(a) must be "qualified in accordance with chapter 35 of Title 52."
N.J.S.A. 52:32-2(b)(2).
The DPMC's final agency decision properly interpreted the
subcontractor naming provisions of N.J.S.A. 52:32-2. Keating met those
requirements. The plain language of the statute is not unclear or ambiguous
and cannot be reasonably interpreted to require naming the subcontractors
intended to perform building control system control work. Building control
systems work is not a trade within the umbrella of HVACR work under the
statute. On the contrary, Keating was only required to identify subcontractors
who would install the actual HVACR system but not those who would engage
in a separate trade by performing the more specialized work of installing
building management control systems.
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DPMC was correct in rejecting Hall's claim that the phrase "all work
kindred thereto" found in N.J.S.A. 52:32-2 should be interpreted to include
building control systems work. Hall's overly broad interpretation of the statute
does not comport with the modern realities of complicated building control
systems, which did not exist when the statute was adopted in 1915. It also
attempts to incorporate different trade works under the umbrella of HVACR
work. See Fisher v. Bd. of Educ., 94 N.J. Super. 359, 366-67 (Ch. Div. 1967),
aff'd, 95 N.J. Super. 18 (App. Div. 1968) (interpreting an analogous provision
in N.J.S.A. 18:11-10 (now repealed)).
Hall's argument under N.J.S.A. 52:32-2 is likewise without merit.
N.J.S.A. 52:35-11 provides that regulations may be adopted "for controlling
the qualifications of prospective bidders. The regulations may fix the
qualification requirements for bidders according to available capital and
equipment, and with due regard to experience and records of past
performance." In turn, regulations have been promulgated standards for the
"classification and qualification" of all bidders for state contracts. See
N.J.A.C. 17:19-1.1 to -5.11. The regulations define "classification" as "the
process and product of assigning specific construction categories or trades and
the aggregate ratings that define the ineligibility of firms to engage in public
work as determined by the DPMC in accordance with this chapter." N.J.A.C.
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17:19-1.1. The 115 "trades for which an applicant may request classifications
are as listed on the DPMC-27." N.J.A.C. 17:19-2.7(b).
DPMC has created classifications for various construction trades that
impose prior experience standards as a condition of classification. N.J.A.C.
17:19-2.7. DPMC has created HVACR (C032) for "steam and hot water
heating and ventilating apparatus" work. It has also created Electrical (C047).
DPMC's "Request for Classification Form" (Form DPMC-27) lists all the
trades for which a contractor can seek prequalification, including HVACR
(C032), Electrical (C047), and Control Systems (C043). N.J.A.C. 17:19-
2.7(b). For the HVACR and electrical classifications, Form DPMC-27 sets
forth specific classification standards, including the additional classifications
they are automatically deemed classified to perform.
Contractors classified in HVACR and electrical are eligible to bid on
contracts that include control systems work but must retain a subcontractor
classified in such trade to perform that work. Also, Form DPMC-27 requires
subcontractors to possess special licenses to perform work under the HVACR
and electrical trade classifications whereas the control systems classification
requires no special license.
DPMC's Bid Form requires the bidder to identify all classified
subcontractors who would be performing HVACR (C032) – Mechanical and
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HVACR (C032) – Duct Work. Because building control systems are not
included within N.J.S.A. 52:32-2, DPMC did not require bidders to identify
C043 classified subcontractors to be named in the bid.
As correctly observed by the hearing officer, the Project's building
control systems work is highly technical, specialized, and expansive. It
requires integrating multiple systems installed by various other trades,
including fire suppression, emergency access, and electrical systems. DPMC's
classification system categorizes building control systems and HVACR work
as wholly different trades that require different experience and expertise. This
distinction is manifested in footnote 8 of DPMC Form-27, which provides that
a contractor classified in trade C032 (HVACR) "shall also be eligible to bid on
contracts including the following [certain] specialty trades, 4 but shall be
required to engage a subcontractor who is classified in the specialty trades
listed: C043, C090." Thus, footnote 8 reflects that HVACR C032 contractors
are not classified to perform Control Systems (C043) work and must engage a
classified Control Systems C043 contractor to perform that trade work unless
4
Classified HVACR contractors are deemed automatically classified in the
following trades: Oil & Gas Burners (C031), Boilers (New Repair) (C033),
Insulation (Mechanical) (C041), Fire Suppression Systems (C042), Sheet
Metal (Mechanical) (C046), and Dust Collectors (C109). Similarly, classified
Electrical (C047) contractors are deemed to be classified in Communications
Systems (C048), Fire Alarm/Signal Systems (C049), and Security/Intrusion
Alarms (C050) under Footnote 9.
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they have been separately classified to perform Control Systems (C043) work.
Overall, footnotes 8 and 9 clearly demarcate the distinction between the
HVACR (C032), Electrical (C047), and Control Systems (C043) trade
classifications.
In addition, Hall argues that Keating engaged in impermissible bid
shopping by not identifying its Control Systems (C043) subcontractor in its
bid. We disagree. Although N.J.S.A. 52:32-2 requires that a prime
contractor's bid identify its four prime subcontractors to discourage bid
shopping as to those trades, that requirement does not extend to other
subcontractors such as Control System (C043) subcontractors. To the
contrary, as correctly noted by the hearing officer, HVACR (C032)
subcontractors "cannot self-perform building controls system work but instead
must subcontract with" a classified Control System (C043) contractor.
Accordingly, bid shopping for this trade work is permitted. 5
Hall argues that DPMC's decision was contrary to the Licensing Law
governing HVACR contractors. Hall contends that N.J.S.A. 52:32-2 and
N.J.S.A. 45:16A-2, the HVACR Licensing Law, should be read in pari materia
5
Notably, Hall's own named HVACR subcontractor is not classified by the
DPMC to perform Control Systems (C043) work and Hall did not identify a
separate Control Systems (C043) subcontractor in its bid. Thus, were Hall the
lowest bidder, it would have had to have retained a separate, unnamed Control
Systems (C043) subcontractor, allowing it to engage bid shopping.
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because they deal with the same subject matter. Hall contends that under the
Heating, Ventilating, Air Conditioning and Refrigeration Contracting License
Law, N.J.S.A. 45:16A-1 to -41, HVACR work includes control systems work
by definition. Hall explains that the definition of HVACR, under N.J.S.A.
45:16A-2, includes "controlling the temperature, humidity and cleanliness of
air" and "control[ling] piping for the control of air, liquid or gas temperatures."
We are unpersuaded.
Hall's position is also contrary to the rules of statutory construction.
These statutes were neither passed at the same time nor belong to the same
Act. Marino v. Marino, 200 N.J. 315, 330 (2009). The statutes neither relate
to the same subject matter nor serve the same purpose or objective. See ibid.The HVACR Licensing Laws created a Board of Examiners to establish
HVACR licensing requirements and to oversee HVACR contractors. N.J.S.A.
45:16A-3 and -4. In contrast, N.J.S.A. 52:32-2 requires bidders to list in their
bid proposals the prime subcontractors that will perform electrical, plumbing,
structural steel, and HVACR trade work but not control systems trade work.
Mere "'adventitious occurrence[s] of like or similar phrases, or even of similar
subject matter, in laws enacted for wholly different ends will normally not
justify applying the rule' of in pari materia construction." Marino, 200 N.J. at
331 (quoting State v. DiCarlo, 67 N.J. 321, 325 (1975)).
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Lastly, amicus curiae ACCNJ asserts a new argument not raised during
the hearing that is contrary to the position taken by the parties. ACCNJ argues
that a general contractor is not permitted to directly retain the subcontractor
that will perform the building control systems work. Instead, that
subcontractor must be retained by either a licensed HVACR or electrical
subcontractor. In explaining his findings, the hearing officer noted that "the
subcontractor performing the Control System work need not be identified in
the bid, regardless of whether that subcontractor is retained directly by the
prime contractor or by the HVACR subcontractor."
"[A]s a general rule, an amicus curiae must accept the case before the
court as presented by the parties and cannot raise issues not raised by the
parties." State v. O'Driscoll, 215 N.J. 461, 479 (2013) (quoting State v. Lazo,
209 N.J. 9, 25 (2012)). See also Pressler & Verniero, Current N.J. Court
Rules, cmt. on R. 1:13-9 (2021) (same); State v. J.R., 227 N.J. 393, 421 (2017)
(declining to "consider arguments that have not been asserted by a party, and
are raised for the first time by an amicus curiae"). We decline to consider this
new argument that was not asserted by the parties before the hearing officer or
the DPMC and is raised for the first time by an amicus.
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To the extent we have not specifically addressed any of Hall's remaining
arguments, we conclude they lack sufficient merit to warrant discussion in a
written opinion. R. 2:11-3(e)(1)(E).
In sum, we dismiss the appeal as moot. In addition, based upon our
careful review of the record and applicable legal principles, and applying our
deferential standard of review, we discern no basis to declare Keating's bid
fatally deficient or to set aside the contract award.
Appeal dismissed as moot.
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