Dobco, Inc. v. Bergen County Improvement Authority, ___ N.J. ___ (2022). In its first opinion in several weeks, the Supreme Court today affirmed, in a per curiam opinion substantially for the reasons given by the Appellate Division, a ruling that the defendant Authority was required to use a public bidding process in selecting a redeveloper for the Bergen County Courthouse. The Appellate Division’s opinion, written by Judge Messano, was summarized here. That opinion contained a detailed analysis of the interplay among the Local Public Contracts Law, N.J.S.A. 40A:11-4(a), the County Improvement Authorities Law, N.J.S.A. 40:37A-44 et seq., and the Local Redevelopment and Housing Law, N.J.S.A. 40A:12-1 et seq., that led to the panel’s conclusion.
In addition to affirming the Appellate Division on the ultimate merits regarding the requirement of public bidding, the Court also agreed that while plaintiff Dobco itself was “estopped from now complaining that a process in which it willingly participated violated the law,” plaintiff Hossam Ibrahim, an officer and shareholder of plaintiff and a resident and taxpayer in Bergen County, was not precluded from bringing his challenge since he had standing as a taxpayer, and that standing was not diminished by his role with Dobco. The majority found that “nothing in the record justifies piercing the corporate veil and treating Ibrahim as the alter ego of Dobco in the circumstances of this case.” Justice Albin dissented from that conclusion.
The majority recognized the concern about a disappointed party using a “straw man” to bring a claim that the party itself could not assert. “To address that concern, we hold that a plaintiff claiming taxpayer standing in an action challenging the process used to award a public contract for goods or services must file a certification with the complaint. That certification should state that (1) the plaintiff is acting independently of, and not taking direction from, any applicant that participated in the process challenged in the action; and (2) the plaintiff is personally paying the legal fees and costs incurred in prosecuting the action, without reimbursement by an unsuccessful applicant. If the plaintiff fails to submit the certification, the trial court should dismiss the plaintiff’s claims.” Since this was a new requirement, the Court stated that it applied only to “future cases.”