California, United States of America
The following excerpt is from Kajima/Ray Wilson v. MTA, 1 P.3d 63, 23 Cal.4th 305, 96 Cal.Rptr.2d 747 (Cal. 2000):
In Drennan v. Star Paving Co. (1958) 51 Cal.2d 409, 412, 333 P.2d 757, a subcontractor withdrew its bid prior to acceptance by the general contractor, but after the general contractor had used the bid in his master bid for the job, and was awarded the public contract. We concluded there was no contract between the general contractor and subcontractor, but nonetheless held the subcontractor's bid enforceable under a theory of promissory estoppel because of the general contractor's reasonable and detrimental reliance. (Id. at pp. 413-415, 333 P.2d 757.) We noted that the subcontractor "had reason to expect that if its bid proved the lowest it would be used by [the general contractor]. It induced `action ... of a definite and substantial character on the part of the promisee'" (id. at p. 413, 333 P.2d 757) because the general contractor was now bound to perform that portion of the job for the amount stated in the subcontractor's bid. (Id. at p. 415, 333 P.2d 757.) We concluded "it is only fair that plaintiff should have at least an opportunity to accept defendant's bid after the general contract has been awarded to him." (Ibid.)
The above passage should not be considered legal advice. Reliable answers to complex legal questions require comprehensive research memos. To learn more visit www.alexi.com.