Section Review

During its review of the low bidder for a public works project, a city learns that the bidder has engaged in litigation against other municipalities and has a reputation for filing a large number of change orders and claims on past projects. The municipality decides to deny the low bidder the public works contract because it is concerned that litigation and excessive claims can add unanticipated costs and slow the project, which has a tight schedule. Is this lawful? In light of the protections afforded under the First Amendment to the U.S. Constitution and Article 19 of the Massachusetts Declaration of Rights, the answer should be no. 

Massachusetts public officials have an obligation to determine if a public works project bidder is a “responsible and eligible” low bidder under the state bid laws. M.G.L. c. 30 § 39M(a) provides that every contract for the “construction, reconstruction, alteration, remodeling or repair of any public work … by any county, city, town … shall be awarded to the lowest eligible responsible bidder on the basis of competitive bids…” The statute defines “lowest responsible and eligible bidder” in relevant part as the bidder who possesses the “skill, ability and integrity necessary for the faithful performance of the work.” To determine the “responsibility” of low bidders, municipalities gather information through several sources, including conducting reference checks on past projects. 

A municipality may learn during that information-gathering process that a bidder has a history of engaging in litigation with towns it has worked with on past projects, as well as filing claims seeking additional payments for any number of reasons. While various statutes and most public works contracts afford contractors the right to seek more money through “change orders” or “claims,” municipalities may become concerned that these claims add unexpected cost and effort to address during the project, and some municipalities use these findings as a reason to find bidders “not responsible.”

These decisions run counter to protections afforded under the First Amendment to the Constitution and Article 19 of the Massachusetts Declaration of Rights. Filing a civil action against a city or its public officials is protected by the First Amendment, which guarantees every citizen's right “to petition the Government for a redress of grievances.” U.S. Constitution, Amendment I. The First Amendment guarantees the fundamental right to file a lawsuit as a constitutionally protected speech: “the right of access to the courts is an aspect of the First Amendment right to petition the Government for redress of grievances.” Bill Johnson's Restaurants, Inc. v. N.L.R.B., 461 U.S. 731, 741 (1983). 

The Supreme Judicial Court (SJC) recently affirmed the importance of petitioning activity under our state constitution in Barron v. Kolenda, citing Article 19’s provisions that “[t]he people have a right, in an orderly and peaceable manner, to assemble to consult upon the common good; give instructions to their representatives, and to request of the legislative body, by the way of addresses, petitions, or remonstrances, redress of the wrongs done them, and of the grievances they suffer.” Although Article 19 refers to petitioning “legislative bodies,” the Barron court stated that “this provision has also not been interpreted to be limited to State representatives or legislative bodies … but rather has been interpreted to be directed at the people’s interaction with government officials more generally, including in particular town officials.” 

There is little question that a lawsuit constitutes petitioning activity, but do the First Amendment and Article 19 protect asserting claims or seeking change orders from a city for additional work? A review of the law confirms that protections extend to these activities. The right of access to the courts is indeed one aspect of the right of petition, but there are others. Duracraft Corp. v. Holmes Prod. Corp., 42 Mass. App. Ct. 572, 576 (1997) aff’d. 427 Mass 156 (1998). For example, the Legislature has defined “a party’s exercise of its right to petition” in the anti-SLAPP (strategic lawsuits against public participation) statute, M.G.L. c. 231 § 59H, as follows: 

Any written or oral statement made before or submitted to a legislative, executive, or judicial body, or any other governmental proceeding; any written or oral statement made in connection with an issue under consideration or review by a legislative, executive, or judicial body, or any other governmental proceeding; any statement reasonably likely to encourage consideration or review of an issue by a legislative, executive, or judicial body or any other governmental proceeding …

The SJC has stated that “the right of petition protected in the anti-SLAPP statute is that right enumerated in the First Amendment to the United States Constitution … and in art. 19 of the Massachusetts Declaration of Rights.” Kobin v. Gastfriend, 443 Mass. 327 (2005). The right of petition contemplated by the Legislature in the statute is one in which a party seeks some redress from the government, such as a formal written request addressed to a public official praying for some relief. 

That is precisely what the contractual-claim and change-order processes entail. When contractors file claims or change order requests on a public works project, they seek extra money by asserting in writing that unforeseen conditions, extra work being ordered, or extra quantities being used entitle them to funds beyond their contract amount. The processes to seek extra money through claims or change orders can be found in statutes and are written into most contracts in one form or another. For example, the Legislature has codified the claims process for one type of claim in M.G.L. c. 30, § 39N, which mandates that a change-order clause be included in all public contracts allowing a contractor to make a claim for unforeseen or latent conditions. Notably, the process requires that these contract adjustment requests “be in writing and shall be delivered by the party making such claim to the other party as soon as possible after such conditions are discovered…” M.G.L. c. 30, § 39N. The statute defines a specific type of conflict — the encounter of unexpected conditions; lays out a procedure for initiating the dispute resolution process — a prompt request in writing; and establishes the remedy — an equitable adjustment in the contract price. 

The Appeals Court likewise describes the use of the statutory change-order process as an “invocation of remedies” — language that reflects petitioning. Glynn v. City of Gloucester, 21 Mass. App. Ct. 390, 397 (1986). These types of written requests for price adjustment, whether styled a claim or change order request, constitute written petitions for relief and should be protected under the First Amendment and Article 19 just as litigation is protected petitioning activity. 

Once one accepts that these activities are constitutionally protected, it is easy to understand why a city cannot deny a contract for written claims or change orders. This conclusion logically follows from case law protecting public employees from discharge in violation of their constitutional rights when they speak on matters involving public concern. Mt. Healthy City Board of Education v. Doyle, 429 U.S. 274 (1977) (First Amendment prohibits discharge of a public school teacher for speaking out against school policies with a local radio station.) In 1996, the Supreme Court extended this rule beyond employment, granting First Amendment protections to an independent contractor whose waste-hauling contract was terminated because of his public criticism of the county commissioners. Board of County Com’rs, Wabaunsee County, Kan. v. Umbehr, 518 U.S. 668 (1996). 

The only remaining issues are whether this rule should apply to prospective bidders rather than to contract holders, as in the Umber case, and whether the protections extend to petitioning activity involving strictly private concerns in addition to issues of public concern. As to the first issue, the Supreme Court has already made clear that the government cannot refuse to hire prospective lower-level public employees because of political party affiliation. Rutan v. Republican Party of Illinois, 497 U.S. 62 (1990). It is only logical to conclude that failing to award a contract to bidders based on First Amendment activities is likewise prohibited. This conclusion is confirmed by the U.S. District Court for the District of Puerto Rico, which has already found that the Puerto Rico Ports Authority could not, consistent with the First Amendment, deny a prospective bidder a construction contract because the contractor had engaged in prior litigation against the Port Authority. Del Valle Group v. Puerto Rico Ports Authority, 756 F. Supp. 2d 169 (D.P.R. 2010). This case confirms not only that prospective bidders deserve First Amendment protections, but that the rule applies to litigation and petitioning over purely private concerns. This rule is consistent with Massachusetts cases where the right to petition under the anti-SLAPP statute is found to apply to parties seeking vindication of purely private rights. Duracraft Corp. v. Holmes Prod. Corp., 42 Mass. App. Ct. 572 (1997), aff'd, 427 Mass. 156 (1998).

As a result, it should be illegal to reject a bidder on a public works project because it engaged in a prior exercise of the right to petition to seek extra funds from other municipalities through written requests. Both litigation and asserting rights to relief through written claims and change orders constitute petitioning activities, and awarding authorities should not be able to withhold valuable government benefits or contracts to prospective bidders because the contractor has in the past asserted these fundamental rights.