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N.J.D. Electronics, Inc. v. New York City Health & Hospitals Corp.

Appellate Division of the Supreme Court of New York, First Department
Jun 7, 1994
205 A.D.2d 323 (N.Y. App. Div. 1994)

Opinion

June 7, 1994

Appeal from the Supreme Court, New York County (Shirley Fingerhood, J.).


The IAS Court neither denied petitioner due process nor committed other reversible error in upholding the determination of the New York City Health and Hospitals Corporation (HHC) Panel of Contractor Responsibility that the petitioner was not a responsible bidder on two contracts for electrical work at hospitals administered by HHC, based upon information revealed, both during HHC's investigation and an independent investigation by the Department of General Services, that petitioner's principal's prior guilty plea in Criminal Court, Kings County, to disorderly conduct, was, in fact, in settlement of a felony charge of attempted bribery in the second degree arising from petitioner's principal having bribed a City inspector to overlook electrical code violations.

"The courts have long recognized the wide authority vested in municipal agencies to make contract proposals that are required by the public interest. In determining the lowest responsible bidder, `the municipal agency charged with the function is rightfully concerned with the bidder's responsibility — an elastic word which includes considerations of skill, judgment and integrity.'" (Matter of Positive Transp. v. City of N Y Dept. of Transp., 183 A.D.2d 660, 661, quoting Abco Bus Co. v. Macchiarola, 75 A.D.2d 831, 833 [Hopkins, J., dissenting], revd for reasons stated in dissent 52 N.Y.2d 938, cert denied 454 U.S. 822.) Courts have therefore upheld as rational agency decisions disqualifying bidders as non-responsible based upon criminal convictions (Matter of Omega Transp. Co. v. Aiello, 52 N.Y.2d 939), criminal indictments (Matter of Zara Contr. Co. v. Cohen, 23 A.D.2d 718), and, as here, the mere investigation of corrupt activities in connection with public contracts (Matter of Konski Engrs. v. Levitt, 69 A.D.2d 940, 942, affd 49 N.Y.2d 850).

The IAS Court properly determined that it was neither arbitrary nor capricious for the Panel of Contractor Responsibility to uphold HHC's determination that the petitioner was not a responsible bidder, based upon information revealed, both during its investigation and that of the Department of Social Services, that the petitioner's principal's disorderly conduct plea arose out of felony charge that he had bribed a City inspector to overlook electrical code violations, since it is well settled that "[o]nce a rational basis for [the agency's] determination is found to exist, the court's power to interfere in the award of a contract arising out of the bidding process is ended." (75 A.D.2d, supra, at 833 [Hopkins, J., dissenting].)

Nor did the IAS Court violate petitioner's due process rights in rejecting its contract bids, since the record reveals that petitioner had notice of the hearing and the opportunity to fully address and rebut, both in writing and at the hearing, HHC's legitimate concerns with respect to the underlying criminal charge against the petitioner's principal for bribing a City inspector which formed the basis for the petitioner's principal's subsequent plea to disorderly conduct (Matter of Schiavone Constr. Co. v. Larocca, 117 A.D.2d 440, 443-444).

Nor was HHC's review of the charge of bribery in the second degree, as petitioner contends, in violation of CPL 160.50 and 160.60 Crim. Proc., which govern the termination of a criminal action in "favor" of the accused, since the petitioner's principal's acknowledged guilty plea to the disorderly conduct violation does not constitute a favorable termination (People v Ryan, 127 Misc.2d 138, 141, affd on other grounds 161 A.D.2d 677; Matter of Morgenthau v. Becker, 102 Misc.2d 507, 514).

We have considered the petitioner's remaining claims and find them to be without merit.

Concur — Murphy, P.J., Carro, Rubin and Williams, JJ.


Summaries of

N.J.D. Electronics, Inc. v. New York City Health & Hospitals Corp.

Appellate Division of the Supreme Court of New York, First Department
Jun 7, 1994
205 A.D.2d 323 (N.Y. App. Div. 1994)
Case details for

N.J.D. Electronics, Inc. v. New York City Health & Hospitals Corp.

Case Details

Full title:In the Matter of N.J.D. ELECTRONICS, INC., Appellant, v. NEW YORK CITY…

Court:Appellate Division of the Supreme Court of New York, First Department

Date published: Jun 7, 1994

Citations

205 A.D.2d 323 (N.Y. App. Div. 1994)
612 N.Y.S.2d 577

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