SKB Industries, Inc. v. Insite

Beers Construction Company (Beers), a general contractor, was accepting bids for both “hardscaping” and landscaping projects as part of its work preparing for the 1996 Summer Olympic Games. Insite (plaintiff), a hardscaping company, wanted to bid on both projects and sought to enter a subcontract with a landscaper for the landscaping portion. SKB Industries, Inc. (SKB) (defendant), a landscaping company, submitted a bid to perform the landscaping work to Insite. The bid was for $1,085,222.50. Insite included SKB’s bid in its bid to Beers for the whole project. After reviewing the bids, Beers noticed that the landscaping portion of Insite’s bid was significantly lower than any other bids for the same services. Beers suspected SKB based its bid on using cheaper materials than required by the project specifications. After some discussion, SKB admitted to using cheaper materials in its bid. SKB submitted a revised bid to Insite for $1,112,222.50 based on performing the work with the approved materials. Insite sent SKB a written subcontract reflecting this new price. After receiving the subcontract, SKB sent Insite a notice to contract and requested an initial payment. SKB never signed the subcontract, however, and ultimately refused to perform much of the landscaping work. As a result, Insite had to perform the landscaping portion of the work in addition to the hardscaping. Insite’s inexperience in landscaping caused it to incur significantly more expense than it would have if SKB performed the work in the subcontract. Insite and SKB eventually entered into a second subcontract to perform a small amount of work, but the second subcontract specifically excluded the previously unperformed work from the first contract. Insite brought suit against SKB in Georgia state court on a theory of promissory estoppel. Insite sought damages equal to the difference in the amount Insite paid to complete the landscaping contract and the amount it would have paid if SKB performed the work, based on SKB’s revised bid including the new materials. The trial court permitted Insite’s promissory estoppel claim, and entered judgment for Insite. SKB appealed.