Holman Erection Co. v. Orville E. Madsen & Sons, Inc.
Supreme Court of Minnesota
330 N.W.2d 693 (1983)
Holman Erection (plaintiff) submitted a steel-erection bid to general-contract bidder Madsen (defendant) by phone shortly before Madsen's own bid was due, per industry practice meant to prevent bid-shopping; Madsen used Holman's bid to prepare its general contract bid and, as the city required, listed Holman as its proposed subcontractor. After winning the general contract, Madsen instead awarded the steel subcontract to Van Knight, a minority-owned business that could satisfy the contract's minority-participation requirement and also offered more labor and materials than Holman had. Holman sued, arguing Madsen's use of its bid and listing it as subcontractor formed a binding contract that Madsen breached by hiring Van Knight instead; the trial court granted Madsen summary judgment.
Whether a contract is formed between a general contractor and a subcontractor merely because the general contractor uses the subcontractor's bid, lists it as the proposed subcontractor as required by the awarding authority, wins the general contract, and then awards the subcontract to someone else.