McCLENDON, J,
This litigation involves a dispute over the award of a construction contract for a state military project following Hurricane Katrina. The plaintiff appeals a judgment dismissing all of its claims with prejudice. For the reasons that follow, we affirm.
On August 29, 2005, Hurricane Katrina made landfall causing immense flooding and property damage in Louisiana. Hard hit were several Louisiana Army National Guard (LAARNG) facilities throughout south Louisiana. When it was determined that the facilities should be repaired or replaced, the National Guard Bureau generated requests for funding. As a result, the U.S. Congress passed legislation that authorized funding of approximately $500,000,000 for the reconstruction of LAARNG facilities. A major stipulation, however, was that the funds had to be obligated in the year of the appropriation, or by September 30, 2006 (the end of fiscal year 2006). In response to the need to quickly and efficiently obligate these funds and award contracts, the Louisiana legislature enacted LSA-R.S. 29:42, the design-build statute.
The last of the fifteen projects undertaken by the LMD using the appropriated funds was the Army Aviation Support Facility, Hammond project (AASF), for the estimated cost of $62,000,000. In accordance with LSA-R.S. 29:42, this new construction project was advanced to the 35% completion level. Thereafter, pursuant to the statute, a Notice of Intent (NOI) to select a design-builder and to request letters of interest and statements of qualifications was distributed. The Lemoine Company, LLC (Lemoine), the plaintiff herein, submitted a letter of interest for the AASF project and was selected, along with Broadmoor, LLC (Broadmoor) and Walbridge Aldinger Company (Walbridge), as the short-listed entities. The short-listed entities were then provided a Request for Proposal (RFP) and invited to submit their detailed technical and cost proposals for the design-build project, pursuant to LSA-R.S. 29:42. Thereafter, as required by the statute, a technical review committee (TRC) was formed to review the design-build proposals and submit a technical score to be used in computing the adjusted score. The statute provided that the proposal with the lowest adjusted score, as established by a specific formula, determined the winning proposal. Broadmoor was ultimately selected and awarded the contract.
On September 21, 2006, Lemoine filed a petition for injunctive relief and declaratory judgment, naming the LMD as defendant, and seeking to prevent the award of the construction contract to anyone other than Lemoine. On September 25, 2006, after discovering that the contract with Broadmoor had already been executed, Lemoine filed amended pleadings seeking damages, in the alternative, including lost profits, costs, expenses, and attorney fees. In an October 12, 2006 order, the trial court concluded that Lemoine's prayer for injunctive relief was moot, but allowed it to proceed by ordinary proceedings on its alternate claim for damages.
Trial on the merits was held on February 23, 2011, and the court took the matter under advisement. In oral reasons on March 28, 2011, the trial court ruled in favor of the LMD and adopted the LMD's argument in its post-trial brief as reasons. Judgment in accordance with the trial court's ruling, dismissing Lemoine's claims with prejudice, was signed on April 19, 2011. Lemoine appealed, contending that the trial court erred in determining that an "acceptable" design was not a mandatory requirement of the bid proposal and in ruling that the LMD properly awarded the contract to Broadmoor.
Louisiana Revised Statutes 29:42A provided:
In its initial argument, Lemoine, although recognizing that the design-build statute was enacted in response to Hurricane Katrina, nevertheless contends that the statute was subject to the public bid law. Lemoine also maintains that Broadmoor did not comply with the contract plans and specifications as required by the design-build statute. Particularly, Lemoine contends that because the TRC concluded that Broadmoor's roof design was unacceptable, Broadmoor's entire proposal should have been rejected.
Louisiana's Public Bid Law, as set forth in LSA-R.S. 38:2211, et seq., is a prohibitory law founded on public policy.
In support of its argument that the public bid law is applicable herein, Lemoine points to Section I of LSA-R.S. 29:42, which provided, in relevant part:
Lemoine contends that this language incorporates the requirements of the public bid law. Lemoine argues that, in accordance with the LSA-R.S. 38:2212A(1)(a) of the public bid law, it was "the lowest responsible bidder who had bid according to the contract, plans, and specifications as advertised." Lemoine further argues that because LSA-R.S. 38:2212A(1)(b)(i) prohibits the waiver of any provisions or requirements of the public bid law, the LMD could not have waived the barrel roof design requirement and cites several cases governed by the public bid law in support thereof. The LMD contends, however, that the public bid law is inapplicable and Lemoine's argument that the public bid law should be bootstrapped into the design-build statute is inconsistent with the fact that Lemoine willingly and without objection entered into the design-build process with the LMD.
Thus, the first issue to be determined in this case involves the interpretation of LSA-R.S. 29:42 and whether it incorporated the requirements of the public bid law. Accordingly, it is a question of law and is reviewed by this court under a de novo standard of review.
In
Hurricanes Katrina and Rita were catastrophic events, resulting in the enactment of short-term legislation to address particular issues created by these disasters. One such statute was LSA-R.S. 29:42, enacted to allow the LMD to quickly address its infrastructure needs and use the design-build process as an alternate contract delivery process to expedite bidding and construction. Unlike the public bid law, the design-build statute was written in permissive and not prohibitory language. The statute provided for flexibility in designing and building a project that the public bid law does not. Plans and specifications were developed to the 35% level to allow a design-builder the freedom to propose design changes that would benefit the project from both design and cost perspectives. It was a separate and complete process.
Our supreme court has previously recognized the legislative power to deviate from the public bid law in certain instances. In
In this matter, incorporating into LSA-R.S. 29:42 all the requirements of the public bid law would have rendered the design-build statute superfluous and would have negated any reason for enacting the statute. Clearly, that was not the intent of the legislature.
Lemoine also argues that because the TRC found Broadmoor's design proposal "unacceptable," the entire bid proposal should have been rejected. Particularly, Lemoine asserts that the 35% Design Submittal included a barrel roof. Lemoine requested clarification regarding the barrel roof design, and in response the LMD issued Addenda #14.
The LMD contends, however, that although the design portion of Broadmoor's proposal was considered "unacceptable," Broadmoor's proposal gave the LMD the best value and had the lowest adjusted score. The LMD maintains that it followed the requirements of the design-build statute and properly awarded the project to Broadmoor. Further, the LMD contends that Lemoine failed to meet its burden, offering no evidence that the LMD deviated from the requirements of the statute.
Vincent Van Champagne and Colonel Douglas Mouton testified at trial. Mr. Champagne testified that in 2006, he was the vice-president of preconstruction services and the chief estimator for Lemoine. He recognized that the design-build process is an integrated delivery process where the owner contracts with a single entity for both design and construction. Mr. Champagne agreed that this typically was a quicker delivery method than that required under the public bid laws. Mr. Champagne continued that, under the design-build method, with a single point of contact, there is usually better cost management and schedule management.
With regard to the AASF project, Mr. Champagne recognized that the LMD was looking for the best value. He also understood that the design guide must be followed although Lemoine was not precluded from changing the design to a better solution that added value. However, he stated that meeting minutes and answers were included in the RFP, and the addenda, which were answers to requests for information by contractors, were incorporated into the contract documents. Therefore, Lemoine submitted questions to the LMD to confirm and be clear regarding the requirement of a barrel roof design. In response to Lemoine's questions, the LMD issued Addenda #14. Mr. Champagne testified that he thought the answers meant Lemoine had no latitude in changing the barrel roof design. It was part of the 35% Design Submittal and the intent, although more costly. Mr. Champagne stated that, accordingly, Lemoine stayed with the barrel roof design and in line with what was required in the RFP.
As to Broadmoor's bid, Mr. Champagne testified that Broadmoor submitted a design with a gable roof for both hangars, which is a much less costly type of roof. Broadmoor received a score of 52 on the design program and architectural intent part of the design. The grading scale stated that anything less than 54 was unacceptable. Mr. Champagne testified that Lemoine received no unacceptable scores. He also stated that that TRC's report showed that Lemoine's design proposal was by far the most sound and complete proposal reviewed by the TRC, whereas, Broadmoor's design disregarded the architectural intent of the 35% Design Submittal and, although functional, was not the best value.
On cross examination, Mr. Champagne admitted that Addenda #14 did not say that that a bidder would be disqualified if its design score was unacceptable, nor did it say that a barrel roof was required. He emphasized however that the addenda stated that it had to be acceptable. Mr. Champagne testified that although the technical review score was merged with the cost proposal, he still believed that the technical score had to be acceptable. Thus, it was Mr. Champagne's opinion that Lemoine could be creative, but had to provide what was requested, which was a barrel roof.
Initially called on cross-examination, Col. Mouton, the Construction Facilities Maintenance Officer for the State of Louisiana, testified that he was involved with the drafting of LSA-R.S. 29:42. He stated that the intent of the process was to restore to readiness the National Guard facilities and to protect the public. He admitted that there was some subjectivity with the design-build process.
Col. Mouton further testified that the role of the TRC was one part of a multi-part process. He stated that "best value" was a formulaic solution pursuant to the design-build statute between a technical score and the price. He testified that under the statute it could also include a time value, but because the LMD was more interested in getting the work under contract faster, it did not want to pressure the selection with the time component. Therefore, according to Col. Mouton, the charge of the TRC was solely to look at one-half of the best value equation, which was the design. He testified that the design element was valued at 200 points out of 3700 overall points. Col. Mouton admitted that Major Brocato came to him concerned because Broadmoor changed its design to a gable roof, which deviated from the intent established in the 35% Design Submittal. Major Brocato indicated to him that he was unsure if Broadmoor should move forward because it ignored the requested design. Col. Mouton stated that their charge was to protect the public interest and restore readiness in Louisiana. Therefore, although he had aesthetic concerns about the roof design chosen by Broadmoor, the design met the functional requirements as set forth in National Guard regulations.
Additionally, Col. Mouton testified that Lemoine's proposal, while brilliant and adhering to the design intent, only delivered the hangar itself. Because of the price, Lemoine was unable to provide any of the Alternate Bid Items (ABIs). Col. Mouton stated that this project was the last to be awarded, and with money and time constraints, the ABI's were added. Broadmoor's proposal allowed for the addition of a connecting taxiway and apron and a C-12 hangar. Therefore, according to Col. Mouton, the best value and the public's interest were not met with the Lemoine proposal. Broadmoor had the lowest adjusted best value score for both the base bid and the base bid with the two ABIs. Accordingly, he recommended to the adjutant general that the contract be awarded to Broadmoor, and the adjutant general concurred.
Col. Mouton also testified that the statute, the RFP, and addenda did not provide that if the design aspect of the project was graded unsatisfactory, the entire proposal would be thrown out. He further stated that it was not the TRC's purpose to determine best value, and the TRC could not have made a best value determination. Instead, their charge was to evaluate the technical qualifications and assign a numeric value to all of the criteria.
In its oral reasons, the trial court, stated:
It is well settled that an appellate court cannot set aside the trial court's findings unless it determines there is no reasonable factual basis for the findings and the findings are clearly wrong.
After a thorough review of the record and the design-build statute, we cannot say that the trial court's findings regarding compliance were manifestly erroneous. The design-build statute clearly set forth the method for determining the winning proposal. Col. Mouton explained how the scores were calculated pursuant to the statute. He testified that in accordance with the statute, the best value was determined using the technical score and the price proposal. See LSA-R.S. 29:42H. The statute, as well as Col. Mouton's testimony, clearly established that the TRC was unable to determine the best value. The TRC only scored one half of the equation, as the price element was not part of the technical score. See LSA-29:42H(1)(a)(i). Further, Lemoine's argument focused on only one element of the technical score, i.e., the design. However, the design score accounted for only 200 of 3700 possible points. Thus, a low score in one category could have been overcome with a higher score in another category.
The trial court agreed with Col. Mouton that the LMD followed the statutory requirements and that Broadmoor's proposal was the best overall value for the AASF project. There is a reasonable factual basis in the record to support the trial court's finding, and we cannot say that the trial court was clearly wrong.
For the above and foregoing reasons, the April 19, 2011 judgment of the trial court is affirmed. All costs of this appeal are assessed to The Lemoine Company, LLC.
PETTIGREW, J., CONCURS, AND ASSIGNS REASONS.
I will respectfully concur with the majority, but I do note the following.
The commissioner of administration, by letter dated December 4, 2007, approved the LMD's use of the design-build concept in accordance with the statute and retroactively waived the public bid law provisions.
Further, Addenda #14 does not say a barrel roof design was required. It allowed flexibility.
