OPINION

J. FREDERICK MOTZ, District Judge.

Jay Dee/Mole Joint Venture ("JDM")1 sued the Mayor and City Council of Baltimore and the Baltimore City Department of Public Works2 ("DPW") (collectively "the City") for damages arising from the City's alleged breach of a public construction contract. The City counterclaimed for breach of contract, liquidated damages, and promissory estoppel. Both JDM and the City have moved for summary judgment on JDM's claims and on the City's counterclaims for breach of contract and liquidated damages. Discovery has been completed, and the parties have filed dispositive motions.3

I.

In October 2006, the City issued a Notice of Letting seeking bids for the Lower Stony Run Interceptor Project ("LSR Project") as governed by Sanitary Contract No. 839R ("Contract 839R"). (Def.'s Am. Answer, Aff. Defenses, and Counter Claims ¶ 11; Pl.'s Jay Dee/Mole Joint Venture's Mot. for Summ. J. on Counts I and II of Pl.'s Compl. ("Pl.'s Mot."), Ex. 1B at NOL-1-2.) The LSR Project was to replace and construct thousands of feet of sewer lines. This work necessitated significant tunnel construction and excavation work, which required a "tunnel boring machine" ("TBM") at a rental cost of around $1 million. (Pl.'s Mot., Ex. 1B at NOL-2, CD-99-100; Mekkaoui Decl. ¶ 13.)

a. The LSR Project and Contract 839R

Contract 839R included hundreds of pages of rules, regulations, and specifications, a few of which are particularly relevant for these motions: (See generally Pl.'s Mot., Ex. 1B.)

On December 6, 2006, JDM submitted the lowest bid for the LSR Project at $40,856,259. The second lowest bidder was Carp Seca Corp. ("Carp Seca"). (Id., Ex. 1E.) Within days, the Minority and Women's Business Opportunity Office ("MWBOO") determined that JDM's bid complied with the Minority-Owned Business Enterprise ("MBE") and Women-Owned Business Enterprise ("WBE") (collectively "M/WBE") participation requirements. (Id., Ex. 5E.)

Along with its bid, JDM deposited a $817,125 bond (two percent of its bid). According to a document entitled "Bid Bond" ("Bid Bond Document"), signed by JDM on November 29, 2006, the bond was to be returned to JDM under two sets of circumstances: (1) if JDM's bid was rejected, or (2) if JDM's bid was accepted and JDM "execute[d] and deliver[ed] a Contract... (properly completed in accordance with said Bid), and ... furnish[ed] a bond for [its] faithful performance of said Contract ... and ... in all other respects perform[ed] the Agreement created by the acceptance of said bid." (Def.'s Response to Pl.'s Mot. for Summ. J. and Def.'s Cross Mot. for Summ. J. ("Def.'s Mot."), Ex. 7 at BB-1-2.)

JDM submitted dozens of pages detailing its bid. JDM enclosed Statements of Intent between JDM and the M/WBEs— including K-O Construction, Inc. ("K-O") and R & R Utility Contractors, Inc. ("R & R")—with whom it had agreed to subcontract to comply with Contract 839R's M/WBE requirements. JDM represented that its subcontract with K-O would satisfy over ninety-five percent of the MBE requirement and that its subcontract with R & R would satisfy over ninety percent of the WBE requirement. All Statements of Intent required both JDM and the subcontractor to attest that they "agree[d] to enter into a contract for the work/service indicated above for the dollar amount or percentage indicated...." The K-O Statement of Intent indicated that it would provide "drainage structures" and "sewer construction" at a cost of $3,898,646. The R & R Statement of Intent indicated that it would provide "sitework and utilities" at a cost of $3,718,625.90. Notably, the "Materials/Supplies to be furnished by MBE or WBE" section of R & R's Statement of Intent was left blank. (See id., Ex. 7 at MWBE-6-8.)

Within weeks of the bids being submitted, Carp Seca filed a Bid Protest with the City Board of Estimates5 ("BOE"), which was eventually rejected on March 28, 2007. (See Pl.'s Compl. ¶ 17.) Also on March 28, the BOE voted to award Contract 839R to JDM. The DPW notified JDM of the award in a letter which read in part:

(Pl.'s Mot., Ex. 1H.) Pursuant to this award letter, JDM provided the City with executed copies of Contract 839R, performance bond, and Proof of Insurance. (See id., Ex. 7A, Ex. 7B.)

b. The M/WBE Subcontract Negotiations

After securing the contract award, JDM immediately moved to finalize subcontracts with both R & R and K-O. By way of background, on November 28, 2006, R & R had submitted a proposal to perform "sitework and utilities on a time and material basis only" ("T & M Proposal"), which served as the basis for the Statement of Intent. (See Pl.'s Mot., Ex. 3A, Ex. 3N.) This proposal listed various hourly wages for R & R employees and mentioned "[m]aterial and equipment provided at cost plus," but did not refer to a TBM or any other specific materials or equipment. (Id., Ex. 3A.) R & R alleges that it understood this proposal—based on its language and other communication with JDM—to cover "the purchase of materials that are incidental to our work .... around $500,000 for incidental materials to our labor, marked up by 20%." (Id., Ex. 3N (emphasis added).) That is, R & R asserts that it envisioned a contract primarily for labor. The City points out that R & R was not even City-certified to use a TBM machine, which would have required R & R or its personnel to have prior experience working on at least six TBM excavations. (See Def.'s Mot., Ex. 8.) JDM, on the other hand, alleges that the T & M Proposal, and other communication between R & R and JDM, indicated that R & R would provide whatever materials and equipment were necessary for the "sitework and utilities."

Shortly after JDM submitted its bid, it became clear that JDM and R & R had significant disagreements about the subcontract. Between December 6 and December 14, 2006, R & R alleges that A.G. Mekkaoui, JDM's project manager, contacted R & R in an effort to renegotiate the labor rates. On December 14, 2006, Mekkaoui faxed R & R a letter in which he asserted that R & R had misunderstood his previous communication and that he was not in fact attempting to renegotiate the labor rates. However, when Mekkaoui met with Jennifer DiPietro, President of R & R, on December 20, DiPietro alleges that Mekkaoui again tried to convince her to reduce the rates. (Id., Ex. 12 ¶¶ 10-12.)

JDM continued to struggle to finalize subcontracts with K-O and R & R after it was officially awarded Contract 839R on March 28. Between April 16 and May 11, JDM extended three subcontract proposals to R & R:

(See Pl.'s Mot., Ex. 3B, Ex. 3E, Ex. 3G, Ex. 3M; Def. Mem. at 25.) R & R rejected all three proposals, asserting that it was entitled to a subcontract with no more than twenty-five percent of the value in materials and equipment. (See Pl.'s Mot., Ex. 3I, 3L.)

Frustrated with K-O and R & R, JDM contacted potential replacement M/WBEs and started negotiating replacement subcontracts. (See Mekkaoui Decl. ¶ 9-14.) On May 4, 2007, JDM contacted the City and sought to substitute these replacement M/WBEs for R & R and K-O. In response, Thomas Corey, Chief of the MWBOO, instructed an MWBOO employee, Eng Peng, to contact both K-O and R & R. Ms. Peng spoke with DiPietro who said that R & R refused to agree to the subcontract because JDM was insisting that R & R provide a TBM as part of the contract and doing so would make R & R merely an "illegal pass through."6 (Pl.'s Mot., Ex. 5I.) Ms. Peng also spoke with representatives of K-O, who complained that JDM refused to execute a subcontract under the terms contemplated in November of 2006. K-O alleged that JDM was trying to "renegotiate key terms" and was shopping the subcontract around to other MBEs. (Def.'s Mot., Ex. 8 at 2.)

On May 6, 2007, just two days after JDM's initial request for substitution, the MWBOO faxed JDM a letter announcing its denial of the request. The letter explained that JDM's reasons for substitution, and K-O's and R & R's reason for refusing to sign the subcontracts, did not justify substitution. The letter also effectively extended the deadline for submission of the M/WBE subcontracts to May 11. (See Pl.'s Mot., Ex. 5K.) Corey later explained the rationale for this denial in more detail. The MWBOO only approves substitution in certain circumstances, such as if the subcontractor becomes unavailable to perform, the subcontractor unreasonably refuses to execute, or the City changes the scope of the work required. (Id., Ex. 10B ¶ 70.) The MWBOO confines substitution to these and similar circumstances in an effort to ensure that the Statements of Intent reflect an actual meeting of the minds that the City can rely on, and to avoid contractors submitting Statements of Intent that they intend to renegotiate or shop around to other M/WBEs after receiving the award. (See id., Ex. 10A at 53-54.) Corey did not believe that any of the circumstances justifying substitution existed in this case. First, he understood both the April 16 and April 26 subcontract proposals as requiring JDM to provide a TBM. (Id., Ex. 10A at 63, 84-86.) Second, he had been in close contact with DiPietro throughout the negotiation process and understood, from her and from documents she provided to him, that JDM had attempted to change the scope and terms of their agreement. (See id., Ex. 10A at 62; Def. Mot., Ex. 12 ¶ 33.) Third, Corey concluded that JDM never actually reached agreements with R & R and K-O as it had represented in its Statements of Intent and therefore Corey considered JDM's bid to have been submitted in bad faith. (Pl.'s Mot., Ex. 6F at 2424-26.)

On May 11, 2007, JDM finally reached an agreement with K-O, which they formally executed on June 4. Also on May 11, JDM sent Corey a letter explaining its inability to reach an agreement with R & R and renewing its request for substitution. On May 16, Corey notified DPW that JDM was in noncompliance with the M/WBE requirements under Article 5, Subtitle 28 of Baltimore City Code for its inability to finalize agreements with either K-O or R & R (the K-O deal had not yet been executed at this point). Corey explained that "we are satisfied that JDM's covenant to comply with the City's MBE ordinance was not submitted in good faith." (See id., Ex. 5M, Ex. 5N.)

On May 18, 2007, DPW representatives informed JDM that it was recommending award annulment because JDM failed to finalize all the M/WBE subcontracts within thirty days of the award letter as required by SC-8 in Contract 839R. (See DiPonio Decl. ¶ 9.) In response, between May 23 and June 12, JDM sent multiple letters to the City arguing that SC-8 did not in fact require finalized M/WBE subcontracts within thirty days.7 (SUMF ¶ 68.)

c. JDM's Pre-Construction Activities

As these subcontract negotiations were occurring, JDM also "commenced pre-construction work activities . . . includ[ing] pre-construction meetings, preparation of the detailed construction schedule, construction planning, submittals, training, subcontracting and various mobilization activities. . . ." (Id. ¶ 16.) Although JDM's post-award construction schedule did not appear to contemplate any work until the Notice to Proceed was issued (see Def.'s Mot., Ex. 6), JDM alleges this mobilization and pre-construction work was necessary in part because of the pressing deadline imposed by the EPA Consent Decree. (SUMF ¶ 8.) However, the DPW sent multiple communications to JDM reminding it to wait until the Notice to Proceed is issued before beginning work, including a May 7 email that read in part: "As per our conversation this morning on site . . . . You are working without a Notice to Proceed, we [sic] directing you to stop all work until the official Notice to Proceed is issued." (See Def.'s Mot., Ex. 5.)

d. Annulment and Its Fallout

Finally, on June 20, 2007, the BOE met to discuss annulling the contract award. Corey, testifying at the meeting, articulated three overlapping reasons for annulment. First, JDM's bid was submitted in bad faith—that is, JDM knew it had not reached a meaningful agreement with either K-O or R & R at the time of its bid submission—thereby undermining the integrity of both the competitive bidding process and the City's M/WBE laws. Corey concluded:

Second, Corey explained that all of JDM's subcontract proposals to R & R demanded around $3 million, the overwhelming majority of the subcontract price, for renting a TBM or providing other equipment. (This explanation was inaccurate: JDM's first two proposals required R & R to provide around $3 million in materials and equipment, but JDM's third proposal only required R & R to provide around $2 million in materials and equipment.) Third, Corey stated that he was troubled by what he believed was JDM dictating R & R's mark-up on the rental equipment under the subcontract. (See Pl.'s Mot., Ex. 6F at 2424-26.)

After Corey's testimony, the City Solicitor moved to annul the award, explaining that he was concerned that the M/WBE requirements had not been met and that he had confidence in Corey's investigation and analysis. The BOE subsequently voted to annul. (See id., Ex. 6F, Ex. 6H.)

On June 18, 2008, JDM filed suit8 alleging four counts against the City: (1) Breach of Contract/Failure to Pay (at least $646,588.77 in pre-construction costs), (2) Breach of Contract/Wrongful Termination, (3) Quantum Meruit, and (4) Unjust Enrichment. The City subsequently filed three counterclaims against JDM: (1) Breach of Contract, (2) Breach of Contract/Liquidated Damages (amounting to $817,125.18), and (3) Promissory Estoppel.

In March of 2009, the City moved to dismiss JDM's Counts III and IV (quantum meruit and promissory estoppel) in part "because an express written contract governs the subject matter of these counts." (Mayor and City Council of Baltimore's Partial Mot. to Dismiss at 2.) JDM consented to dismissal on the condition that the City "acknowledge[] . . . the existence/formation of an express, written and binding contract. . . ." JDM also asserted its "position that as a matter of law and equity Defendants' are estopped from subsequently taking a position inconsistent or contrary with the City's repeated acknowledgement of the existence of an express, written and binding contract." (Pl. JDM's Consent to Def.'s Partial Mot. to Dismiss at 1-2.) I then dismissed Counts III and IV "provided . . . that [the City] may file a motion to rescind this order on or before April 22, 2009 if they do not consent to the conditions that plaintiff has imposed upon his consent. . . ." (Doc. # 28.) No such motion was ever filed.

II.

The parties agree that this Court has diversity jurisdiction over this suit under to 28 U.S.C. § 1332 and that Maryland substantive law governs. Summary judgment is appropriate when there is no genuine issue of material fact and the moving party is entitled to judgment as a matter of law. See FED. R. CIV. P. 56(c); Alpha Constr. and Eng'g Corp. v. Ins. Co. of State of Pennsylvania, 601 F.Supp.2d 684, 688 (D.Md.2009). A genuine issue exists "if the evidence is such that a reasonable jury could return a verdict for the nonmoving party." Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248, 106 S.Ct. 2505, 91 L.Ed.2d 202 (1986). "When cross-motions for summary judgment are submitted to a district court, each motion must be considered individually, and the facts relevant to each must be viewed in the light most favorable to the non-movant." Alpha Constr., 601 F.Supp.2d at 688 (internal marks omitted) (quoting Mellen v. Bunting, 327 F.3d 355, 363 (4th Cir.2003)).

III.

In Count I, JDM has sued for breach of contract "to recover payment due for work performed prior to termination of the Contract, including pre-construction activities to assemble, set-up and prepare for the start of the Project work." The outcome of this claim, like most of the parties' claims, hinges primarily on two questions: (1) whether the parties agreed to Contract 839R, and (2) whether the City abused its discretion in denying JDM's request to substitute a different WBE for R & R. Although Contract 839R was formed, because the City acted within its discretion in denying JDM's substitution request, JDM materially breached Contract 839R by failing to finalize the required WBE subcontract with R & R. Consequently, JDM is not entitled to damages under a breach of contract theory and summary judgment on Count I will be granted in favor of the City.

a. Contract 839R was Formed on March 28, 2007

"To prevail in an action for breach of contract, a plaintiff must prove that the defendant owed the plaintiff a contractual obligation and that the defendant breached that obligation." Taylor v. NationsBank N.A., 365 Md. 166, 776 A.2d 645, 651 (2001). A contract "must rest finally upon an offer made by one party and the acceptance thereof by the other party . . . . The offer must be certain and definite, and the acceptance must in every respect meet and correspond with the offer." Buffalo Pressed Steel Co. v. Kirwan, 138 Md. 60, 113 A. 628, 630 (1921). Maryland law interprets offers and acceptances objectively: "what a reasonable person in the position of the parties would have thought [they] meant." Nat'l Fire Ins. Co. of Hartford v. Tongue, Brooks & Co., Inc., 61 Md.App. 217, 486 A.2d 212, 216 (Md. 1985) (quoting Ray v. Eurice, 201 Md. 115, 93 A.2d 272 (1952)) (internal marks and other citations omitted); see also Beckenheimer's, Inc. v. Alameda Assoc. Ltd. P'ship, 327 Md. 536, 611 A.2d 105, 110 (1992).

Under the City's procurement laws, public contracts worth more than $25,000 must be awarded through a competitive bidding process. See BALTIMORE CITY CHARTER, Art. VI, § 11(b). The law governing public contract formation through a bidding process is informed by basic contract law principles. To begin with, "[a]n invitation to bid on a public contract is not an offer to contract but a solicitation for an offer. The contractor's bid is the offer to contract." Hadaller v. Port of Chehalis, 97 Wn.App. 750, 986 P.2d 836, 839 (1999) (internal citations omitted) (interpreting Washington law); accord Stark Elec. v. Huntington Hous. Auth., 180 W.Va. 140, 375 S.E.2d 772, 774 (1988) (interpreting West Virginia law); cf. Am. Lighting Co. of Baltimore City v. McCuen, 92 Md. 703, 48 A. 352, 353-54 (1901) (interpreting Maryland law). "Award of a competitively bid contract normally is made by (1) acceptance of the low responsive bid from a responsible bidder and (2) communication of the acceptance by an authorized person to the low bidder during the `firm bid' period." BRUNER & O'CONNOR ON CONSTRUCTION LAW § 2:139; see also Am. Lighting, 48 A. at 353-54 ("When the board of awards . . . actually awarded the contract to the plaintiff. . . . the contract was . . . complete and legally binding . . . . The minds of the parties met, and nothing remained to be done but to prepare and execute the more formal contract as provided by the charter. Such being the situation, it is well settled, both upon general principle and authority, that the contract is complete."); Ne. Mississippi Cmty. College Dist. v. Vanderheyden Constr. Co., 800 F.Supp. 1400, 1402 (N.D.Miss.1992) (interpreting non-Maryland law) (quoting City of Susanville v. Lee C. Hess Co., 45 Cal.2d 684, 290 P.2d 520 (1955); Gurtler, Hebert & Co. v. Orleans Parish School Bd., 251 So.2d 51, 53-54 (La.App.1971)).

On March 28, 2007, the City bound itself to the terms of Contract 839R.9 Whether it was through the BOE contract award vote or the award letter from DPW, or both, the City (1) accepted JDM's low responsive bid and (2) communicated that acceptance, through an authorized person, to JDM. See BRUNER & O'CONNOR, supra, § 2:139. That is, the City accepted JDM's offer to enter into Contract 839R.10

The parties dispute whether this performance contract formed on March 28 required JDM to submit the executed M/WBE requirements within thirty days of award notice.11 JDM points out that Contract 839R did not expressly include such a requirement: SC-8 required the successful bidder to formally execute the contract and provide other documentation within thirty days, but said nothing about the timeline for submitting M/WBE subcontracts. Accordingly, JDM argues, the thirty day deadline, expressly required in the award letter, was a new term not properly part of the contract.12 Regardless of whether this specific thirty day deadline bound JDM, however, Contract 839R implicitly required JDM to provide the City with all of the executed M/WBE subcontracts within a reasonable time after the contract award, and there is no genuine dispute that JDM was unable to do so. (See Pl.'s Mot., Ex. 1B at MWBE-1-2 (requiring submission of "copies of all executed agreements with the MBE and WBE firms. . . . prior to the issuance of a notice to proceed").) JDM and R & R were at an impasse because of a fundamental disagreement about the terms of the subcontract; they would have been unable reach an agreement even without a thirty day deadline. As a result, I need not decide whether that deadline bound JDM; either way, JDM failed to furnish the City with the M/WBE subcontracts as required by Contract 839R.

b. JDM Materially Breached Contract 839R

Because JDM was unable to agree to a subcontract with R & R, and the City did not abuse its discretion in denying JDM's request for substitution, JDM materially breached Contract 839R by failing to comply with its M/WBE requirements.

Although any breach of contract may give rise to a cause of action for damages, RESTATEMENT (SECOND) OF CONTRACTS § 236 cmt. a., only a material breach discharges the non-breaching party of its duty to perform. 23 WILLISTON ON CONTRACTS § 63:3 (4th ed.); see Final Analysis Comm'c Serv. v. Gen. Dynamics Corp., 253 Fed.Appx. 307, 313 (4th Cir. 2007) (unpublished) (citing Rogers Refrigeration Co., Inc. v. Pulliam's Garage, Inc., 66 Md.App. 675, 505 A.2d 878, 883 (Md.Ct. Spec.App.1986); Fromm Sales Co. v. Troy Sunshade Co., 222 Md. 229, 159 A.2d 860, 863 (1960)). Under Maryland law, "[a] breach is material `if it affects the purpose of the contract in an important or vital way.'" Gresham v. Lumbermen's Mut. Cas. Co., 404 F.3d 253, 260 (4th Cir.2005) (quoting Sachs v. Regal Sav. Bank, FSB, 119 Md.App. 276, 705 A.2d 1, 4 (Md.Ct. Spec.App. 1999)). Additionally, although I was unable to find Maryland case law expressly so holding, it is literally "hornbook law" that "[w]here the contract itself is clear in making a certain event a material breach of that contract, a court must ordinarily respect that contractual provision." 23 WILLISTON ON CONTRACTS § 63:3 (4th ed.) (citing Dunkin' Donuts of Am., Inc. v. Middletown Donut Corp., 100 N.J. 166, 495 A.2d 66 (1985)).

Contract 839R provided that "any unjustified failure to comply with MBE and WBE participation requirements is a material breach of contract." (See Pl.'s Mot, Ex. 1B at MWBE-1-2.) As discussed above, there is no genuine dispute that JDM and R & R were at an impasse and unable to reach an agreement. JDM therefore failed to comply with the WBE participation requirements under any reasonable interpretation of Contract 839R. Moreover, this failure was not "justified." Although R & R's T & M Proposal provided that "material and equipment [would be] provided at cost plus", the focus of the proposal was hourly wage rates and it never suggested that materials or equipment would amount to anything approaching the majority of the subcontract value. In fact, the R & R Statement of Intent submitted with JDM's bid included nothing in the section entitled "Materials/Supplies to be furnished by MBE or WBE." Comparing these details, of the T & M Proposal and the Statement of Intent, to JDM's demands that R & R provide fifty to ninety percent of the subcontract value in materials and equipment makes clear that JDM's failure to comply with the WBE requirements was a problem of its own making. At the very least, JDM failed to reach a meaningful agreement with R & R prior to submitting its bid; at worst, JDM tried to strong-arm R & R into accepting new subcontract terms after JDM possessed the leverage of having secured the contract award.

Because of its unjustified failure to comply with the WBE requirement via subcontracting with R & R, JDM found itself in material breach of Contract 839R unless it could substitute a different WBE in R & R's place. As a result, the question becomes whether the City abused its discretion in denying that substitution request.13 As an initial matter, I must note my concern about the City's M/WBE requirements and compliance process. By demanding that prime contractors hire M/WBE subcontractors—who are likely to be repeat players familiar with City officials—and generally refusing to allow post-contract award substitution, the City gives M/WBEs extraordinary bargaining power in negotiating their subcontracts. Prime contractors unable to finalize these subcontracts may find themselves at the whim of unelected bureaucrats—who may have preexisting relationships with the M/WBE(s) involved, yet possess the de facto power to scuttle contracts often worth millions of dollars—at the MWBOO. This system is particularly troubling considering that the M/WBE requirements were presumably originally introduced, in part, to facilitate the entry of previously excluded companies into the City subcontracting business. Today, however, the system risks creating the opposite effect: helping well-connected subcontractors access a piece of the City contracting pie under favorable terms.

Unfortunately, the MWBOO's conduct in this case illustrates some of my concerns. Despite a $40 million contract at stake, the MWBOO took only two days to investigate the dispute between JDM and R & R before denying the substitution request. Moreover, the conclusions the MWBOO reached were primarily based on communications with R & R, who Corey—the head of the MWBOO—admittedly trusted as a result of his longstanding working relationship with that company.

All that said, in this particular case, no reasonable trier of fact could find that the City abused its discretion. Although Corey was mistaken about some of the circumstances surrounding the JDM-R & R negotiations, Corey and the MWBOO nonetheless had legitimate reasons for denying substitution. As described above, JDM had demanded subcontract terms— requiring R & R to provide large amounts of materials and equipment—which R & R never contemplated or agreed to at the time the Statement of Intent was filed with JDM's bid. One of two inferences must be drawn from that action: either JDM lacked an actual, meaningful agreement with R & R at the time the Statement of Intent was filed (because JDM understood the "agreement" to mean one thing and R & R reasonably understood it to mean something materially different), or JDM and R & R did reach an agreement but JDM later used its leverage as the contract awardee to try to strong-arm R & R into accepting new terms. Either way, the City's decision was within its discretion. If the City's denial was based on JDM's failure to reach a pre-bid submission agreement, that decision furthered the City's legitimate interest in preventing prime contractors from submitting Statements of Intent in the absence of an actual agreement with the M/WBE. If the City's denial was based on JDM's efforts to pressure R & R into accepting new contract terms, that decision furthered the City's legitimate interest in preventing prime contractors from bullying M/WBEs into accepting less favorable subcontract terms.

In sum, because JDM failed to finalize a subcontract with R & R, and the MWBOO's refusal to permit substitution was not an abuse of discretion, JDM materially breached Contract 839R.14

c. JDM's Material Breach Precludes Recovery for the City's Failure to Pay

Given that JDM materially breached, there remains the question of whether JDM is nevertheless entitled to payment for the work it performed after Contract 839R was formed but before it was terminated. Again, a material breach discharges the non-breaching party of its duty to perform. See Final Analysis Comm'c, 253 Fed.Appx. at 313 (unpublished) (citations omitted); 23 WILLISTON ON CONTRACTS § 63:3 (4th ed.). "[A] party who has materially breached a contract is not entitled to recover damages for the other party's subsequent nonperformance. . . since the latter party's performance is excused." 23 WILLISTON ON CONTRACTS § 63:3 (4th ed.); see also Hubler Rentals, Inc. v. Roadway Express, 637 F.2d 257, 260-61 (4th Cir.1981) (holding that plaintiff could not recover for defendant's contract termination, even though termination was pursued in a manner that violated the termination process prescribed by the contract, because plaintiff had previously materially breached and "[t]he fact of breach was all that the Maryland rule requires to bar [plaintiff] from recovering damages for breach of contract"); Collins/Snoops Assoc., Inc. v. CJF, LLC, 190 Md.App. 146, 988 A.2d 49, 57 (Md.Ct.Spec.App.2010) ("On a claim for breach of contract, the plaintiff (or counterplaintiff) asserting the claim for damages bears the burden of proving all elements of the cause of action, including plaintiff's own performance of all material contractual obligations.").

The parties dispute both the nature of the work JDM was expected to complete prior to issuance of a Notice to Proceed and the extent of the work JDM actually completed prior to termination. Regardless, the City's obligation to perform—that is, its obligation to pay—was discharged when, in May 2007, JDM reached an impasse in the subcontract negotiations with R & R, thereby materially breaching Contract 839R by running afoul of the WBE requirements. See supra Section III.b. Because JDM does not allege the City failed to pay or otherwise breached before May 2007, JDM materially breached first and it cannot recover for the City's subsequent non-performance.

IV.

In Count II, JDM alleges that the City is liable for breach of contract for wrongfully terminating Contract 839R. Because JDM materially breached Contract 839R prior to the City terminating, see supra Section III, the City acted within its legal rights and summary judgment will be granted in the City's favor. See e.g., 23 WILLISTON ON CONTRACTS § 63:3 (4th ed.) (noting that a material breach discharges the non-breaching party of its duty to perform).

I reject JDM's argument that the BOE's annulment decision—that is, the City's termination-should be invalidated under the Accardi Doctrine because the MWBOO failed to follow three requirements under BALTIMORE CITY CODE, ART. V, § 28-87 (M/WBE requirements): (1) notifying the contractor if it "finds cause to believe that [the] contractor . . . has failed to comply with any requirement," (2) "attempt[ing] to resolve the noncompliance through conciliation", and (3) if noncompliance is not resolved, submitting written findings and recommendations to the BOE. The Accardi Doctrine, as adopted in Maryland, requires administrative agencies to follow their own rules, regulations, and procedures. See Pollock v. Patuxent Inst. Bd. of Review, 374 Md. 463, 823 A.2d 626 (2003). However, "the complainant . . . must . . . show that prejudice to him or her (or it) resulted from the violation in order for the agency decision to be struck down." Id. at 650-51.

The parties do not fully brief whether the BOE is an administrative agency subject to the Accardi Doctrine, or whether a BOE action can be invalidated because of the MWBOO's failure to abide by certain requirements. Regardless, even if applicable, the Accardi Doctrine does not invalidate the BOE's decision. First, although the City does not point to any specific communication where it explicitly told JDM that it had cause to believe that JDM failed to comply with the M/WBE requirements, the repeated communications from the MWBOO about JDM's inability to finalize the subcontracts amounted to notification that the MWBOO believed JDM was failing to comply. Second, the MWBOO attempted in good faith to resolve noncompliance through conciliation: it extended JDM's deadline for compliance, sought to understand the obstacles to finalizing the subcontracts, and communicated with JDM about satisfying the M/WBE requirements. Lastly, although the City does not point to any evidence that the MWBOO submitted written findings and recommendations directly to the BOE, JDM has failed to prove that it was prejudiced by this failure. The MWBOO explained its recommendation to the DPW in a written memorandum and to the BOE in live testimony, the DPW explained its recommendation in writing to the BOE, and JDM was well aware of the position of both the MWBOO and the DPW prior to the BOE hearing.

V.

In its first counterclaim, the City sued JDM for breach of contract. This counterclaim seems to have been originally intended to allege that JDM breached Contract 839R, even though the City now denies the legal force of that contract. (See Def.'s Am. Answer, Aff. Defenses, and Counter Claims ¶ 88.) Possibly because of that tension, the City did not expressly move for summary judgment on this counterclaim, although its arguments implicitly suggest summary judgment is appropriate. Although JDM also failed to expressly move for summary judgment here, in its opposition/reply JDM "seeks dismissal" of this counterclaim because the City inappropriately terminated Contract 839R, JDM did not breach Contract 839R, and the City cannot establish damages.

"[I]n order to state a claim for breach of contract, a plaintiff need only allege the existence of a contractual obligation owed by the defendant to the plaintiff, and a material breach of that obligation by the defendant." RRC Ne., LLC v. BAA Maryland, Inc., 413 Md. 638, 994 A.2d 430 (2010) (citing Taylor, 776 A.2d at 651). "It is not necessary that the plaintiff prove damages resulting from the breach, for it is well settled that where a breach of contract occurs, one may recover nominal damages even though he has failed to prove actual damages." Taylor, 776 A.2d at 651 (citations omitted). If the non-breaching party does seek damages upon proof of liability, it "may recover . . . for 1) the losses proximately caused by the breach, 2) that were reasonably foreseeable, and 3) that have been proven with reasonable certainty." Thomas v. Capital Med. Mgmt. Assoc., LLC, 189 Md.App. 439, 985 A.2d 51, 66 (Md.Ct.Spec.App.2009) (citations and marks omitted).

JDM breached its contractual obligation to comply with the M/WBE requirements. See supra Section III. However, the City has not proved, nor really attempted to prove, that it suffered damages as a result of this breach. Consequently, I will grant summary judgment in the City's favor on this counterclaim, but I will award only nominal damages of one dollar.15

VI.

The City's second counterclaim seeks $817,125.18 in liquidated damages—that is, JDM's bid bond—for breach of contract because "JDM failed to comply with the terms of its Bid Contract to fulfill all of the conditions precedent to enter a Performance Contract with the City within 30 days of the award. . . ." JDM, on the other hand, argues that it was only required to execute Contract 839R and furnish the City with the required documentation and performance bond to get its bid bond back. JDM asserts that the performance bond, not the bid bond, secured its obligation to perform under Contract 839R.

Under the Maryland state public contract regulations and law, a bid bond:

Kennedy Temporaries v. Comptroller of the Treasury, 57 Md.App. 22, 468 A.2d 1026, 1033-34 (Md.Ct.Spec.App.1984) (quoting MD.CODE REGS. 21.06.07.03) (internal marks and other citations omitted). Similarly, under the Baltimore City charter:

BALTIMORE CITY CHARTER, Art. VI, § 11(g)(3)-(4). The Bid Bond Document here required returning the bid to JDM if (1) its bid was rejected, or (2) its bid was accepted and JDM "execute[d] and deliver[ed] a Contract . . . (properly completed in accordance with said Bid), . . . furnish[ed] a bond for his faithful performance of said Contract . . . and . . . in all other respects perform[ed] the Agreement created by the acceptance of said bid." (Def.'s Mot., Ex. 7 at BB-1.)

JDM, as the successful bidder, complied with all these terms in the Bid Bond Document. After receiving the award, JDM properly executed and delivered the contract, furnished the performance bond, and otherwise performed all post-award, pre-formal contract execution instructions included in Contract 839R. Once JDM did so, the performance bond, not the bid bond, became the City's protection. Although SC-8 provided for bid bond forfeiture if the award was annulled, that provision only discussed annulment for failure to meet certain post-award, pre-execution conditions which JDM in fact satisfied. Consequently, the City is not entitled to the bid bond and summary judgment will be granted in JDM's favor on this counterclaim.

VII.

In its third counterclaim, the City seeks damages for its detrimental reliance on JDM's promise that it had reached agreements with the necessary M/WBE subcontractors. The City does not appear to have moved for summary judgment on, or even mentioned, this promissory estoppel claim in its motion or reply. Although JDM also failed to formally move for summary judgment on this counterclaim, in its opposition/reply it argues that this counterclaim should be dismissed.

"Once it is established, either by an admission of a party or by a judicial finding, that there is in fact an enforceable contract between the parties . . . then a party may no longer recover under the theory of promissory estoppel." Francis C. Amendola, et al., 28 AM.JUR.2D ESTOPPEL AND WAIVER § 57 (citing World Championship Wrestling, Inc. v. GJS Intern., Inc., 13 F.Supp.2d 725 (N.D.Ill.1998)); accord Heating & Air Specialists, Inc. v. Jones, 180 F.3d 923, 934 (8th Cir.1999) (citing to courts in multiple jurisdictions and noting "the widely accepted principle that promissory estoppel is applicable only in the absence of an otherwise enforceable contract"); cf. Pavel Enterprises, Inc. v. A.S. Johnson Co., Inc., 342 Md. 143, 674 A.2d 521, 534 (1996) ("[T]here are different ways to prove that a contractual relationship exists between a general contractor and its subcontractors. Traditional bilateral contract theory is one. Detrimental reliance can be another.").

Because I have found that an enforceable contract, Contract 839R, existed between JDM and the City, the City's promissory estoppel claim will be dismissed as moot. Shandong Airlines Co., Ltd. v. CAPT LLC, 650 F.Supp.2d 1202, 1207 (M.D.Fla.20009) ("[B]ecause relief on these quasi-contract claims cannot be granted once a breach of contract has been established, the Court cannot enter relief based these claims. Accordingly, for purposes of granting this motion, Shandong's promissory estoppel claim . . . [is] regarded as moot." (internal citations omitted)); Jones, 180 F.3d at 934 ("[T]he jury necessarily found that an enforceable contract between the parties existed. This finding moots the issue of whether, in the absence of an enforceable contract, Lennox may have been liable to A/C under a theory of promissory estoppel.").

ORDER

For the reasons stated in the accompanying Memorandum, it is, this 26 day of July, 2010

ORDERED