§103D-707  Remedies after an award.  (a)  If after an award it is determined that a solicitation or award of a contract is in violation of law, then:

     (1)  If the person awarded the contract has not acted fraudulently or in bad faith:

          (A)  The contract may be ratified and affirmed, or modified; provided that it is determined that doing so is in the best interests of the State; or

          (B)  The contract may be terminated and the person awarded the contract shall be compensated for the actual expenses, other than attorney's fees, reasonably incurred under the contract, plus a reasonable profit, with such expenses and profit calculated not for the entire term of the contract but only to the point of termination;

     (2)  If the person awarded the contract has acted fraudulently or in bad faith:

          (A)  The contract may be declared null and void; or

          (B)  The contract may be ratified and affirmed, or modified, if the action is in the best interests of the State, without prejudice to the State's rights to such damages as may be appropriate.

     (b)  If the award of the contract was made in violation of law, and the award is rescinded and the contract, if executed, is terminated or declared null and void, then:

     (1)  For solicitations issued pursuant to section 103D-302, the contract may be awarded to the next lowest responsive and responsible bidder; provided that all prices remain the same as originally bid; or

     (2)  For solicitations issued pursuant to section 103D-303, the contract may be awarded to the next responsive and responsible offeror whose proposal is determined in writing to be the next most advantageous, taking into consideration the evaluation factors set forth in the solicitation; provided that all prices remain the same as originally offered. [L Sp 1993, c 8, pt of §2; am L 1999, c 162, §5; am L 2022, c 180, §1]

Case Notes

  To determine whether ratification of an unlawfully awarded contract is in State's best interests, consideration must be given to State's interest in achieving the purposes of the procurement code.  85 H. 431, 946 P.2d 1.

  Where, if after award of contract, chief procurement officer finds no violation of law, but after de novo review pursuant to §103D-709, hearings officer finds otherwise, §103D-705 requires hearings officer to determine whether to ratify or terminate contract as provided in paragraph (1)(A) and (B).  85 H. 431, 946 P.2d 1.

  Whatever considerations may have driven the governmental body to terminate the contract, the hearings officer did not fail to carry out the officer's responsibilities under the procurement code because the officer did not need to consider the best interest of the State in accepting the parties' termination of the contract.  93 H. 155, 997 P.2d 567.