WITHDRAWL OF PUBLIC WORKS CONTRACT BIDS AFTER DATE OF OPENING

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Page 2 Opinion No.~74-4 January 16, 1974 of $155,825. The closing date for receipt of bids was set at 2 p.m., December 14, 1973, at which timE~ such bids as had been submitted were opened and declared by the City's purchasing agent. The lowest bid was submitted by O.K. Coyle in the amount of $163,200. The next lowest was that of Sharecroppers, Inc. in the amount of $191,329. On December 18, the City's purchasing division received a letter, dated De oember 17, from Otis K. Coyle stating that in summarizing his bid he had omitted to include $15,546 for the cost of reinforcing steel and requesting that his bid be disqualified and that he not be awarded the contract. As yet, the City Council has not taken any action on the award of the contract. This contract is for public works construction and therefore falls under the requirement that it be awarded only to the lowest and best bidder. Charter Section 421. No contract is created until the making of the. award by the City Council. City of Susanville v. Lee C. Hess Co. (Supreme Ct. 1955) 290 P2d 520. Prior to the Council's action but after the bids have been opened and declared, each bid is in the nature of an irrevocable option, of which the City may not be deprived without its own consent, unless the requirements for recission of the contract are satisfied, in which case the contractor is entitled to cancel his bid. M.F. Kemper Construction Co. v. City of Los Angeles (Supreme Court, 1951) 235 P2d 7. Although mutual mistake of fact is sometimes said to be an essential element of recission, a unilateral mistake by the bidder is sufficient if the City has knowledge of the mistake prior to its acceptance of the bid; and where the contractor has notified the City of the mistake prior to the Council's award of the contract the City is deemed to have such knowledge. M.F. Kemper Constr. Co. v. Los Angeles, supra. In the present case, Mr. Coyle's letter of December 17 satisfies this requirement of recission. A second requirement is that the mistake must not be the result of a neglect of a legal duty. (Civil Code Section 1577). "Neglect of a legal duty" has been held to be the equivalent of "gross negligence" - the want of even scant care or an extreme departure from the ordinary standard of conduct. If the error is one which will sometimes occur in the conduct of reasonable and cautious businessmen, it does not amount to neglect of a legal duty. M.F. Kemper, supra; White v. Berenda Mesa Water District (Ct. of App., 1970) 87 Cal Rptr 338. -9-