Bid Mistakes
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| Bid mistakes are not uncommon in the construction industry. In the hustle of submitting bids, likely on more than one project, human error can result. Whether a contractor will be held to his bid submitted in error turns on an examination of the circumstances in each case.
A crucial point for rescission is that the mistake was not the result of an error in the contractor's judgment. In other words, a contractor cannot submit a bid then have it nullified just because he made a bad bargain. Courts often look to various factors to determine whether the contractor should be held to the bid. These include whether enforcement of the erroneous bid would be unconscionable, whether the mistake was material to the bid, whether the mistake would have occurred if ordinary care was exercised, and whether it is possible to place the other party in status quo.
Owners who are aware of a possible mistake in the bid that they received are under a duty to notify the contractor of such suspicion. A notable scenario where an experienced owner might be subject to the notification duty is when there is a significant price difference between one bid and all others submitted or in relation to the owner's own estimate for the cost of the project.
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