NJ Appeals Court Clarifies Disclosure Requirements for Award of Public Contracts

The New Jersey Appellate Division, in a published opinion, clarified which stockholder addresses must be disclosed by bidders for public projects, holding that the requirement is not limited to home addresses.

The court upheld the dismissal of a complaint brought by Asphalt Paving Systems against Stone Harbor following the award of a construction contract to Fred M. Schiavone Construction.

Stone Harbor issued a notice to bidders in August 2020 that included instructions, specifications, and forms, according to the opinion. Schiavone submitted the lowest bid and won the contract. Asphalt came in with the second-lowest bid. As part of the bid package, Schiavone provided the names and addresses of its two stockholders, Fred and Roberta Schiavone. That address is a post office box in Malaga.

Judge Clarkson S. Fisher Jr., in his written opinion for the court, stated that the New Jersey Legislature has declared that no business entity may be awarded a public contract unless, prior to or along with its bid, the business entity submits “a statement setting forth the names and addresses” of the individuals owning more than 10% of the entity.

“In this appeal, we consider and hold that the Legislature did not intend the word ‘addresses’ to be synonymous with ‘home addresses‘ and that the statute’s requirement is met when the bidder provides its owners’ mailing addresses,” Fisher wrote.

According to the opinion, Asphalt commenced this action in October 2020, and obtained an order to show cause, which temporarily barred Stone Harbor from executing a contract for a construction project. Schiavone and Stone Harbor responded to the order before Judge Mary C. Siracusa in Cape May County Superior Court.

Siracusa determined that, according to NJSA 55:25A-24.2, bidders are required to disclose their address but the statute does not specify that the address provided must be their home address. Siracusa noted that although Stone Harbor’s bid specification did include a request for the bidder’s home address, that requirement was waivable, citing River Vale v. RJ Constr.

The judge found that the waiver would not “deprive the municipality of its assurance that the contract will be entered into, performed and guaranteed according to its specified requirements” and would not give the bidder “a position of advantage over other bidders or undermine the necessary common standard of competition.”

On appeal, Asphalt argued that Siracusa erred in its application of the RiverVale test and that the Legislature intended the word “address,” as written in the statute, to mean “home address.” Fisher rejected Asphalt’s argument as to the RiverVale test and said it was “without sufficient merit to warrant further discussion in a written opinion.”

As to the Legislature’s meaning of the word “address,” Fisher stated that it can mean multiple things because people often have multiple addresses. Fisher concluded that the Legislature intended that a bid would comply if the bidder provided the home, business, or mailing address for each owner of 10% or more.

“There is no evidence in the enactment itself,” Fisher wrote, “and nothing about the statutory goals the legislature was pursuing by enacting the statute, to suggest a desire to comply with the production of only one of these types of addresses.

“The Legislature meant to require the owners’ home addresses it would have said ‘home addresses’ rather than ‘addresses,’” Fisher concluded.

Judges Heidi Willis Currier and Patrick DeAlmeida joined in Fisher’s opinion affirming Siracusa’s ruling.

“Stone Harbor is pleased with the decision,” said Paul Baldini, counsel to Stone Harbor. “I believe the decision was the correct decision. The statute does not require a home address and the borough is within its rights to waive the requirement for a home address. And I am pleased the Appellate Division decided to report the opinion. My understanding is that this issue has come up in other locations in New Jersey and this will put the issue to rest.”

Vincent J. Pancari of Capizola, Pancari, Lapham & Fralinger was counsel for Schiavone.

“I have respect for the panel, but we disagree,” stated counsel for Asphalt, John F. Palladino of Hankin, Sandman, Palladino, Weintraub & Bell. “The purpose in asking for the name and address of bidders is to identify the owners are. The determination that a bidder can use a post office box does very little to help the public to know the identity of a bidder.”

“My intention is to appeal and I hope the New Jersey Supreme Court will listen,” said Palladino. “People who are allowed to use a PO box should be disqualified. I do not believe it was the intent of the legislature to have bidders provide useless information.”

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