Question 1

The sole bid received is over the approved budget. Can the Owner negotiate with the bidder?

Accepted Answer

QUESTION

The client received only one bid in response to the tender that is over the approved budget for the project.

COMMENT

Where there is only one compliant bid, the issue of violating conditions of Contract A with other bidders does not exist. The GCs allow the owner to reject all bids, which they probably should do if they don’t have the funds to proceed.

Then if the municipal bylaws permit negotiation without competition, the Owner can proceed to adjust the design and requirements to negotiate a price both can live with. Once a deal is reached, the documents are adjusted to suit and Contract B commences just as it would if there had been a normal process. I don’t think there is any violation of MMCD GCs or ITs if it is done this way. More likely the problem will be purchasing rules and restrictions.

Question 2

All tenders received were over budget. Can the project be retendered without alteration to the original tender package?

Accepted Answer

QUESTION

I am looking for guidance on the legalities of retendering a construction project that was previously tendered but all tenders were rejected as the costs were significantly more than the Engineer’s cost estimate and therefore over the allocated budget.

COMMENT

The GCs allow the owner to reject all bids, which they probably should do if they don’t have the funds to proceed.

The sole bid received is over the approved budget. Can the Owner negotiate with the bidder?

All tenders received were over budget. Can the project be retendered without alteration to the original tender package?

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