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Volume 6 - Number 28 | July 14, 2008
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EDITOR'S NOTES
It is not uncommon for an owner to offer some type of incentive to prospective contractors as a way to entice multiple bids. However, the Ninth Circuit determined that an Indian tribe went too far by promising state sales tax exemptions to non-Indian contractors and suppliers hired to complete a $75 million casino expansion project. “The right of territorial autonomy is significantly compromised by the Tribe’s invitation to the non-Indian subcontractor to theoretically consummate purchases on its tribal land for the sole purpose of receiving preferential tax treatment,” the court ruled.
In this week’s next case, a state appeals court reminds a heavy highway contractor that it has an obligation to uphold decent business practices, regardless of contract stipulations about schedules. That includes a duty of implied good faith and fair dealings. The contractor significantly changed the scheduling for paving on five overpasses and expected the paving subcontractor to meet the expedited schedule under unrealistic terms.
Finally, contract omissions are bound to happen as long as human nature is part of the contracting process. When a federal clause regarding the use of underprivileged businesses was unintentionally left out of a bid solicitation, the agency rightly omitted the requirement when considering the bid proposals.
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