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https://nap.nationalacademies.org/catalog/27432/critical-issues-in-transportation-for-2024-and-beyond

AVOIDING PITFALLS IN SUBCONTRACTOR BIDDING

This article discusses the legal rights and obligations of subcontractors and general contractors in subcontractor bidding. A subcontractor submitting a bid is generally bound by that bid, even if it contains an error, if the general contractor relies on it in preparing its own bid, which in turn is accepted by the owner. The main exceptions to this principle is if the subcontractor's bid is so blatantly in error that it should alert the general contractor to a potential mistake, or if the subcontractor expressly reserves the right to withdraw its offer at any time. Although subcontractors are bound to general contactors for their bids, the mere use of the subcontractor's bid does not mean that it has been accepted by the contractor. A subcontractor also is not required to leave open its bid for acceptance indefinitely. The adverse consequences of "bid shopping," especially after the contract has been awarded to the contractor, are discussed. To mitigate these consequences, a bid is considered rejected if a contractor is awarded the contract and then goes back to the subcontractor to renegotiate prices or terms or attempts to procure a lower price from another subcontractor. In this case, the subcontractor is no longer under any obligation to honor its original bid.

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  • Corporate Authors:

    Cygnus Publishing, Incorporated

    1233 Janesville Avenue, P.O. Box 803
    Fort Atkinson, WI  United States  53538-0803
  • Authors:
    • Gregory, D
  • Publication Date: 2002-3

Language

  • English

Media Info

Subject/Index Terms

Filing Info

  • Accession Number: 00976617
  • Record Type: Publication
  • Files: TRIS
  • Created Date: Jul 11 2004 12:00AM