HomeMy WebLinkAboutAGENDA REPORT 1994 1207 CC REG ITEM 08DCity and County of San Francisco
',,O COUNTY
Louise H. Renne,
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City Attorney
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California City Attorneys
Office of City Attorney
ITEM
Geoffrey Spellberg
Deputy City Attorney
(415) 554 -3954
Oki
November 9, 1994
RE: League of California Cities-- Amicus Brief Request
Dear California City Attorney:
I am writing to advise you of an important issue presently
before the California Court of Appeal that potentially affects
every California municipality. The issue involves the
entitlement of municipalities to disqualify a contractor from
bidding on public works contracts as a result of dishonest
conduct by the contractor. Presently, it appears that
municipalities lack such entitlement. That means that dishonest
contractors who submit low bids on public works projects must be
awarded those contracts even though such contractors will
inevitably submit inflated co:f overrun claims when the job is
completed.
The issue is before the appellate court on the following
facts. San Francisco hired a publics work contractor to perform
a construction job that ultimately finished late and over
budget. The contractor submitted a large contract claim for
extra costs and brought a lawsuit based upon that claim. The
claim was grossly inflated. As a result, the San Francisco
Public Utilities Commission held a two day public hearing to
determine whether the false claim was knowingly submitted. After
taking a ^nom from all nart,��s the Commission concluded that
�dnlny evr..e..� r_.
the contractor had intentionaa.ly submitted over $400,000 in false
billings in an attempt to defraud Sari Francisco.
Based upon that finding„ the Commission declared the
contractor "irresponsible" for a period of five years. That
holding disqualified the contractor from bidding on any San
Francisco public works projecf, f r the five year period.
is/g /4 y ce a ?ems. -- �
(415) 554 -3800 Fox Plaza, 1390 Market Street. Suite 1010
40045
San Francisco 94102 -5404
City Attorneys -2- 11/9/94
Amicus Brief
The contractor brought an action in San Francisco Superior
Court challenging the Commission's decision. The court issued an
injunction staying the decision and holding that the Commission
lacked authority to disqualify the contractor. The San Francisco
City Attorney's Office has appealed the court's order.
Federal public contr,,ct_
goverrii ng the issue of cone
there is no s irrilar stage �
Code requires award of conga
bidder -- without any mechanism
the appeal, we have asked the
right of California municipal
bidding on public works proje+
"irresponsibly."
ng law contains extensive authority
,car disqualification. In contrast,
3rithority. The Public Contract
to the lowest responsible
for evaluating responsiblity. By
appellate court to recognize the
ties to disqualify contractors from
is where the contractors Nave acted
The League of California Cit_ies has recognized the
importance of this issue. It has authorized the preparation and
filing of an amicus brief Ln support of San Francisco's
position. Hans Van Ligten (7i4 641- 5100) of Rutan & Tucker is
presently preparing the amicu, brief. Joan Gallo, the San Jose
City Attorney (408 277 - 4454), is the League Advocacy Committee
member who has been assigned o supervise the brief.
The League and San Francisco are looking for all public
entities that are concerned about the issue to join in the amicus
brief. Since I believe that i municipality's ability to control
its award of public works contracts is critical to assuring
quality work at fair prices, the appellate issue here has broad
municipal affect. As such, I urdc and request that you join as
an amicus on the brief.
Please contact Mr. Ligten of Ms. Gallo if you wish to Coln
on the brief. Thank you for pour attention to this matter.
Please call me with anv auest :oris.
Very truly yours,
LOUISE H. RENNE
City Attorney
GE F_ SPELL G
Deputy City A Forney
cc Joan Gallo, Esq.
Hans Van Ligten, Esq.
JoAnne Speers, Esq. (League of California Cities)
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