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Pavel Enterprises, Inc. v. A. S. Johnson Company, Inc.

Court of Appeals of Maryland
342 Md. 143, 674 A.2d 521 (1996)


Facts

The National Institute of Health (NIH) solicited bids from general contractors for work on a planned construction project. In response, Pavel Enterprises Incorporated (Pavel) (plaintiff), a general contractor, began preparing a bid for the project by soliciting its own bids from a number of subcontractors. A.S. Johnson Company (Johnson) (defendant) submitted the lowest subcontractor bid, which Pavel used in calculating a bid for submission to NIH. Pavel submitted only the second lowest bid and was not immediately awarded the contract. Ultimately, however, NIH awarded the contract to Pavel, and Pavel informed Johnson that Johnson had been selected as the subcontractor for the project. Johnson, however, replied that its bid had contained an error, and that as a result the bid was too low. Accordingly, Johnson sought to withdraw its bid. Pavel refused to consent to Johnson’s withdrawal and ultimately was forced to accept the bid of another subcontractor. The substitute contractor’s price was $32,000 higher than Johnson’s bid, and Pavel brought suit to recover this difference. The trial court, analyzing the facts under both traditional contract principles and a theory of detrimental reliance, found that no contract had been formed, nor enforceable promise made. Pavel appealed.

Rule of Law

The rule of law is the black letter law upon which the court rested its decision.

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Issue

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Holding and Reasoning (Karwacki, J.)

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  • A "yes" or "no" answer to the question framed in the issue section;
  • A summary of the majority or plurality opinion, using the CREAC method; and
  • The procedural disposition (e.g. reversed and remanded, affirmed, etc.).

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