NOT FOR PUBLICATION WITHOUT THE
APPROVAL OF THE APPELLATE DIVISION
SUPERIOR COURT OF NEW JERSEY
DOCKET NO. A-5395-07T2
IN THE MATTER OF THE CONTRACT
FOR SCIENCE WING ADDITION AND
ALTERATIONS (PUBLIC BID NO.
P-1946) — SUBSTITUTION OF BROOKS
MECHANICAL CONSULTANTS, INC. AS
SUBCONTRACTOR, BEFORE THE BOARD
OF TRUSTEES OF BERGEN COMMUNITY
BROOKS MECHANICAL CONSULTANTS,
Argued telephonically December 4, 2009 -
Decided March 4, 2010
Before Judges Carchman and Lihotz.
On appeal from the Bergen Community College
Board of Trustees, P-1946 (A-5395-07T2), and
the Superior Court of New Jersey, Law Division,
Bergen County, Docket No. L-2560-08 (A-5548-07T2).
Richard E. Wenger argued the cause for
appellant Brooks Mechanical Consultants, Inc.
(Hedinger & Lawless, L.L.C., attorneys;
Mr. Wenger and Anthony J. Belkowski, on the
Christopher L. Weiss argued the cause for
respondent Dobco, Inc. (Ferro, Labella &
Zucker, L.L.C., attorneys; Mr. Weiss and
Russell T. Brown, of counsel and on the
briefs; Michael A. McDonough, on the briefs).
Victoria A. Flynn argued the cause for
respondent Bergen Community College (DeCotiis,
FitzPatrick, Cole & Wisler, L.L.P., attorneys;
Ms. Flynn, on the brief).
In these two separate appeals, which we consolidate for the
purposes of this opinion, we address the issues of 1) whether
the board of a community college has primary jurisdiction to
adjudicate a contract dispute between a contractor and a
subcontractor on a contract to provide improvements to the
college; and 2) whether the board erred by permitting the
substitution of a subcontractor by the general contractor after
the bids have been awarded. We answer both questions in the
negative. As a result, we reverse the June 6, 2008 order of the
Law Division transferring jurisdiction of the contract dispute
to the college board and affirm the determination of the same
board permitting the substitution of the subcontractor.
These are the facts relevant to both appeals. In November
2007, defendant Bergen Community College (the College or the
Board, as relevant) advertised a request for bid proposals (RFP)
from general contractors for renovation of the College and
construction of a science wing addition. The RFP required each
bidding contractor to list all subcontractors in its bid, and
stated that "[a]pproval by the engineer must be obtained for all
subcontractors proposed[,]" and that "any legal challenges to
the bidding process, the award or non-award of the contract
. . . must be pursued before the Board . . . ."
The general contractor, defendant Dobco, Inc. (Dobco)
submitted its bid, listing the contractor, plaintiff Brooks
Mechanical Consultants, Inc. (Brooks), as both its HVAC and
plumbing subcontractor. In January 2008, the College awarded
the contract to Dobco.
The terms of the final contract between Dobco and the
College allowed for substitution. It required Dobco to submit a
list of subcontractors to the College's project architect, who
could object along with the College:
5.2.1 Unless otherwise stated in the
Contract Documents or the bidding
requirements, the Contractor, as soon as
practicable after award of the Contract,
shall furnish in writing to the Owner
through the Architect the names of persons
or entities . . . proposed for each
principal portion of the Work. The
Architect will promptly reply to the
Contractor in writing stating whether or not
the Owner or the Architect, after due
investigation, has reasonable objection to
any such proposed person or entity.
Dobco could also reasonably object to a subcontractor and would
not be required to contract with that subcontractor:
5.2.2 The Contractor shall not contract
with a proposed person or entity to whom the
Owner or Architect has made reasonable and
timely objection. The Contractor shall not
be required to contract with anyone to whom
the Contractor has made reasonable
Substitutions were allowed in the following circumstances:
5.2.3 If the Owner or Architect has
reasonable objection to a person or entity
proposed by the Contractor, the Contractor
shall propose another to whom the Owner or
Architect has no reasonable objection. The
Contract Sum shall be increased or decreased
by the difference in cost occasioned by such
change and an appropriate Change Order shall
be issued. However, no increase in the
Contract Sum shall be allowed for such
change unless the Contractor has acted
promptly and responsively in submitting
names as required.
5.2.4 The Contractor shall not change a
Subcontractor, person or entity previously
selected if the Owner or Architect makes
reasonable objection to such change.
By a March 5, 2008 letter to the College's project
architect, Dobco sought to replace Brooks with other
subcontractors for both the HVAC and plumbing work. Its review
of Brooks's references and subcontract estimates had made it
uneasy with regard to Brooks's ability to complete the project
and of particular concern, Brooks had also refused to provide
the performance and payment bond that Dobco required for the
value of the subcontract. Dobco informed the College:
The reason for the request of substitution
is due to the fact that Dobco Inc. is at an
impasse with awarding any subcontract
agreement to Brooks. For several weeks now,
we have attempted to qualify the
responsiveness of Brooks. The purpose to
conduct [sic] qualification of a
subcontractor is to be assured that they are
capable of performing the project, inclusive
of all other work on hand. One of the most
essential qualifications is having a
subcontractor provide a performance and
payment bond for their subcontract value.
Dobco Inc. requested additional information,
including consent of surety, from Brooks in
order to confirm their competence. Upon
review of their list of references,
evaluation of bid tabulation and reluctance
to furnish a performance and payment bond,
Dobco Inc. has reason to believe that Brooks
may jeopardize the successful completion of
Also, Dobco noted that it had recently experienced subcontractor
default on another project, and it was only able to complete
that project because those subcontractors had furnished bonds
for their work. Unlike Brooks, the new subcontractors that
Dobco wanted to substitute on the College's project had provided
various qualification documents and performance and payment
bonds corresponding to the value of their subcontract estimates.
Brooks objected to any substitution. It claimed that it
was "a qualified and experienced contractor that is fully
capable of performing both the plumbing work and the HVAC work
on this project[,]" and that Dobco had been engaging in post-
award bid shopping. That is, Dobco had been pressuring Brooks
to lower its original price estimates.
Thereafter, the project architect advised Dobco by
email that the College had no objections, and "that Dobco
may proceed with the substitution."
Brooks then filed a complaint and jury demand against Dobco
in the Law Division, seeking monetary damages. It alleged that
Dobco had "violated the public bidding laws" and had breached
its "contractual and statutory obligations to Brooks" when it
had "bid shopped" the subcontract, that is, finding a lower
quote from another subcontractor and then demanding that "Brooks
either back out of the HVAC subcontract or that it reduce the
amount of its quote to meet the amount of the lower quote that
Dobco had received." The College, the Board, and the architect
were not named or joined in the contract action, and Brooks did
not seek injunctive relief to stop the project.
Dobco informed the Board about Brooks's complaint, and it
"submit[ted] this dispute to the College for resolution in
accordance with [N.J.S.A. 18A:3B-6f1 of the Higher Education
Restructuring Act of 1994, N.J.S.A. 18A:3B-1 to -38]."
N.J.S.A. 18A:3B-6 (emphasis added) states:
The governing board of each public
institution of higher education shall have
the following general powers and duties to
fulfill its mission and the Statewide goals
in cooperation with other institutions and
the State coordinating structures:
. . . .
f. To have final authority to determine
controversies and disputes concerning
tenure, personnel matters of employees not
classified under Title 11A of the New Jersey
Statutes, and other issues arising under
Title 18A of the New Jersey Statutes
involving higher education except as
otherwise provided herein. Any matter
arising under this subsection may be
assigned to an administrative law judge, an
independent hearing officer or to a
subcommittee of the governing board for
hearing and initial decision by the board,
except for tenure hearings under N.J.S.
18A:6-18. Any hearings conducted pursuant
to this section shall conform to the
requirements of the "Administrative
Procedure Act," P.L.1968, c. 410 (C.52:14B-1
et seq.). The final administrative decision
of a governing board of a public institution
of higher education is appealable to the
Superior Court, Appellate Division;
. . . .
These powers and duties are in addition to
and not a limitation of the specific powers
and duties provided for the governing board
of each public institution under chapters 64,
64A, 64G or 64E of Title 18A of the New
Jersey Statutes. If the provisions of this
section are inconsistent with these specific
powers and duties, the specific powers and
duties shall govern.
On May 2, 2008, the College granted Dobco's request. The
College expressed concern and was "troubl[ed]" that it may be
implicated "in allowing a violation of the public bidding laws."
It determined that the hearing would be "be an informal, non-
adversarial proceeding" and would be "conducted in accordance
with the College's bylaws that address hearings for public
On May 27, 2008, a hearing was conducted before a tribunal
comprised of three Board members, whose stated purposes were:
"one, to determine whether or not in fact there was a violation
of those public bidding laws by the College and, secondly, the
College's determination to grant permission for the substitution
of the subcontractors to Dobco, whether or not that was a
decision that was arbitrary and capricious."
There was no formal discovery, no swearing of witnesses, no
cross-examination, and no adherence to the rules of evidence;
instead, counsel for each party was "instructed to make a
focus[ed] presentation of their respective positions." The
record consisted of (1) written submissions with related
attachments presented by Dobco and Brooks before the hearing,
(2) non-privileged documents contained in the architect's files,
which had been provided to Dobco and Brooks, and (3) written
submissions presented after the hearing.
Various disputed facts were revealed at the hearing that
had not been presented to the architect or to the College prior
to its decision allowing Dobco to change subcontractors.
Specifically, Dobco alleged that it had mistakenly listed Brooks
as a subcontractor on its bid and had not realized the mistake
until after the contract was awarded. Dobco had intended to
list another HVAC subcontractor and had based its bid on that
subcontractor's pre-bid oral estimate, which was $300,000 less
than Brooks's $1.97 million written HVAC estimate that Dobco had
not received until after its bid was enroute to the College. In
fact, the HVAC price in Dobco's bid was $1.7 million, which was
the other subcontractor's estimate of $1.6 million plus an
Dobco had asked Brooks to withdraw from the awarded
contract, but Brooks had refused and reduced its estimate by
$100,000. After making inquiries in the industry about the
reliability of Brooks's new management team, Dobco asked Brooks
to procure a performance bond for the HVAC and plumbing work and
to provide references. According to Dobco, the references
demonstrated that Brooks did not have enough experience to
timely complete large HVAC projects, and Dobco was concerned
that the reduced profit margin in Brooks's revised estimate
would also affect its performance.
In response, Brooks accused Dobco of bid shopping and of
demanding that Brooks reduce its HVAC estimate by $273,711 after
the contract was awarded. Brooks asserted that Dobco's intended
HVAC subcontractor could not have provided any pre-bid estimate,
as evidenced by the post-award dates on the price quotes from
that subcontractor's suppliers. Also, Dobco's performance bond
request came two months after the bidding process, and Brooks's
original estimates had stated that they were based upon no bond
being provided. In any event, Brooks's bonding agent confirmed
that, based on Brooks's "present underwriting which includes
analysis of [its] financial position and prior job experience,"
it was "a highly qualified and well respected contracting
company," and "a preferred construction entity in good
Despite those disputed facts, the parties agreed that
Brooks had refused to procure the requested bond. In fact, in
two February 2008 letters to Dobco, Brooks had declared that it
"will NOT provide consent of surety . . . from my bonding
company" because "[t]his was not requested, specified, or
included in the original proposal dated 12/11/07" and that
"[t]he Bond cannot be provided: Both the partners and Bonding
company do not feel comfortable issuing a bond for a project
that Brooks Mechanical is not a prime contractor."
The tribunal submitted to the College its "Recommended
Findings of Facts and Conclusions of Law." It found that: (1)
Brooks's claim of public bidding violations, i.e., illegal bid
shopping, lacked merit; (2) the College's and architect's
decision to allow the substitution was reasonable, and not
arbitrary or capricious; and (3) the College lacked authority to
resolve Brooks's private contract claim filed against Dobco. On
June 4, 2008, the Board voted at its public meeting to approve
the tribunal's decision.
In a thorough analysis of the facts and the law, the Board
first "decline[d] Dobco's invitation to decide whether Brooks
has an actionable contract claim against it because to do so
would interfere with the Superior Court's Authority." The
hearing was "not intend[ed] to ultimately resolve Brooks'[s]
claim against Dobco[,]" because the Board has no authority under
N.J.S.A. 18A:3B-6f to adjudicate private contract claims and
interfere with the Superior Court's authority. The Board
refused to read N.J.S.A. 18A:3B-6f broadly by finding a
delegation of decision-making power for general purposes in
N.J.S.A. 18A:3B-2e of the Higher Education Restructuring Act of
N.J.S.A. 18A:3B-2 states:
The Legislature finds and declares that:
. . . .
b. the elimination of unnecessary State
oversight and its accompanying bureaucracy
will serve to unleash the creativity and
innovation of these institutions; and
. . . .
e. in order to provide institutions
with the ability to fulfill their mission
and Statewide goals, greater decision making
and accountability must be placed at the
institutional level . . . .
The Board declared that adjudicating the private contract
claims here "would intrude upon the authority of the Superior
Court of New Jersey[,]" which "has original general jurisdiction
to resolve any claims in this State[.]" It cited Muise v. GPU,
Inc., 332 N.J. Super. 140, 160 (App. Div. 2000), for the
proposition that "'primary jurisdiction cannot be invoked when
the claim is outside the agency's jurisdiction, or when the
remedy for such a claim is outside the agency's power.'"
The Board next discussed Brooks's claims of illegal bid
shopping, which it defined as the "illicit actions of a general
contractor, following the award of a public contract, to
pressure its subcontractors to lower their prices so to drive
down the costs of the project and to increase the profits for
the general contractor at the expense of the public contracting
entity." Although the parties had relied on out-of-state cases
to define "bid shopping," the Board stated that
the parties need not look any further than
the cases decided in New Jersey, which
discuss the statutory provisions that
require bidders to identify subcontractors
in their bid documents; the purpose of those
statutes is to avoid general contractors
from securing lower prices after the
submission of bids at the expense of the
contracting party. See e.g., Clyde N.
Lattimer & Son Construction Co. v. Township
of Monroe Utilities Authority, 370 N.J.
Super. 130, 134 (App. Div. 2004) (quoting
Statement of Governor Kean that accompanied
his conditional veto to Senate Bill No.
1029, L. 1987, c. 48, which noted that if
the public bidding laws permitted general
contractors to name subcontractors after
submitting their bids, the contracting
entity would be unlikely to benefit from any
cost savings realized by the general
contractor in securing subcontractors).
In fact, the Board referred to N.J.S.A. 18A:64A-25.25 of
the County College Contracts Law, N.J.S.A. 18A:64A-25.1 to
-25.32, which expressly requires bid documents of general
contractors to list subcontractors and provide evidence from
those subcontractors of their performance security:
All bids submitted shall set forth the name
or names of, and evidence of performance
security from, all subcontractors to whom
the bidder will subcontract the work
described in the foregoing categories
(a) through (e).
The listed categories are as follows:
(a) The plumbing and gas fitting work;
(b) The heating and ventilating` systems and
(c) The electrical work, including any
electrical power plants;
(d) The structural steel and ornamental iron
(e) All other work and materials required
for the completion of the project.
Although it would "not condone illegal bid shopping by its
contractors[,]" the Board stated that a general contractor was
not "forever precluded from substituting subcontractors on a
public project. . . . For instance, it is quite possible that a
subcontractor may file for bankruptcy during the course of a
long-term public project, thereby precluding the subcontractor's
ability to complete the project."
Distinguishing the facts here from various published bid
shopping cases, the Board concluded that "the actions of Dobco
do not constitute illegal bid shopping." It found: (1) Dobco
submitted the required subcontractors list with its bid, "but
mistakenly identified Brooks as the subcontractor for HVAC" and
plumbing; (2) when Dobco listed the pre-bid estimates it
received from its subcontractors, it "mistakenly, however,
indicated that Brooks agreed to perform the HVAC portion of the
Project for $1.6 million, an amount slightly less than the $1.7
million quote provided in Dobco's bid[;]" (3) "Brooks'[s] quote
for the HVAC portion of the Project did not arrive at Dobco's
office until after the bid was in transit to the College[;]"
(4) "the estimate Dobco used in its bid was based on the verbal
quote of one of the substituted subcontractors[;]" (5) "Dobco
and Brooks tried to figure out a way in which Brooks could
perform the HVAC subcontract[;]" (6) "[w]hile Dobco may have
requested Brooks reduce its price, it only asked that it do so
to bring Brooks'[s] bid proposal in line with the quote for the
HVAC work contained within the bid and not to increase Dobco's
profit margin[;]" (7) "Brooks would not perform the HVAC portion
of the Project for less than $1.9 million[;]" and (8) "Dobco
will suffer financially as a result of the substitutions for the
HVAC and plumbing portions of the Project."
The Board also noted that Brooks's original HVAC estimate
"exceeded" the HVAC line item in Dobco's bid, which meant that
Dobco would not have profited if Brooks had not lowered its
price. The Board concluded that there was no bid shopping here.
The Board acknowledged, however, that those facts were
disputed and had not been presented by Dobco in its March 5
letter requesting substitution approval. In fact, neither Dobco
nor Brooks had been "particularly candid with the College
regarding the substitution request." However, the Board
declared that the only fact "not in dispute is the fact that
Brooks refused to provide Dobco with consent of surety." See
N.J.S.A. 18A:64A-25.25. Brooks had not disputed its refusal,
and the College had relied on that refusal when consenting to
Dobco's substitution request.
Referencing "the well-developed case law" showing the
importance of the consent-of-surety requirement, the Board was
therefore "unable to conclude that Dobco [had] engaged in
illegal bid shopping simply because it [had] required Brooks to
provide a consent of surety and requested a substitution when
Brooks refused to do so.” While N.J.S.A. 18A:64A-25.25 does not
specify how a subcontractor is to demonstrate performance
security, the Board found that Dobco's requesting that Brooks
provide a consent of surety after its review of the
subcontractor's references and bid tabulation sheets "appears to
fulfill the intent of this provision."
Furthermore, the Board found that Brooks's refusal violated
"the spirit of the County College Contracts Law" in N.J.S.A.
18A:64A-25.25. Because bidding laws exist to protect taxpayers
and are construed in the public good, the Board could not
"overlook" Brooks's refusal. Since that refusal "was the
primary reason offered to the College when requesting
substitution," the Board concluded that "the actions of the
architect and the College were not arbitrary or capricious, but
instead were more than reasonable under the circumstances."
Finally, the Board rejected Dobco's claim that the College
would be liable for damages for its agreeing to the substitution
if Brooks prevailed. It pointed out that the College had relied
on Dobco's representations in deciding whether the substitution
request was reasonable and that the contract itself provided
that general contractors would indemnify the College for any
claims arising out of the contract.
As to the pending Law Division action, Dobco had filed a
motion in the Law Division to dismiss Brooks's complaint with
prejudice for lack of subject matter jurisdiction or, in the
alternative, to transfer the action to the Board for resolution
pursuant to N.J.S.A. 18A:3B-6f, since that statute gave the
Board primary jurisdiction to resolve all bidding actions under
the County College Contracts Law. Brooks opposed the motion,
arguing: (1) the dispute was a private contract action and not
a bidding matter involving the College; and (2) the Board has no
authority or power to award damages against Dobco should Brooks
The judge denied Dobco's motion to dismiss the complaint,
but granted its motion to transfer the contract action to the
Board. Jurisdiction was not retained. The judge held that the
Board was the appropriate forum for Brooks's contract action.
He explained that
[t]he issue manifestly presented in this
motion is not whether N.J.S.A. 18A:64A-25.25
prohibits "bid shopping" [sic] and creates
an independent cause of action for the
aggrieved subcontractor. The issue is
whether this cause of action can be
maintained when jurisdiction can or should
be before the Board of Trustees to hear the
dispute pursuant to N.J.S.A. 18A:3B-2(f).
He concluded "that the central issues arise out of Title 18A"
because the allegations in the complaint charged that Dobco and,
implicitly the College, had violated public bidding laws when
they replaced Brooks. He noted that the Higher Education
Restructuring Act of 1994 was enacted by the Legislature (1) to
eliminate unnecessary oversight of the State and its bureaucracy
in order to "unleash the creativity and innovation of these
institutions[,]" N.J.S.A. 18A:3B-2b, and (2) to give "[g]reater
authority and accountability" to institutions of higher
education, N.J.S.A. 18A:3B-2e.
Also, he found that the four factors in Muise, supra, 332
N.J. Super. at 160-61, "favor[ed] the exercise of jurisdiction
by the Board of Trustees and that a hearing before the Board of
Trustees is the appropriate forum for this action." He
When the [sic] enacting the Higher Education
Restructuring Act, the Legislature intended
to give more autonomy to education
institutions. Further, the Request of
Bid/Approval gave notice to plaintiff and
other potential subcontractors that disputes
as to the award or non-award of bids must be
pursued before the Board of Trustees.
Consequently, the judge found that because the basis of
Dobco's motion for dismissal was "that primary jurisdiction lies
with the Board[,] . . . the action should be transferred
pursuant to R[ule] 1:13-4 rather than dismissed." Brooks
appealed both the decision of the Board as well as the judge’s
transfer of the contract dispute to the Board.2
Brooks’s appeal of the judge’s decision to transfer is
interlocutory since the Board took no action after the transfer;
however, because of the unique circumstances presented here and
to prompt a full resolution of all issues in dispute, we
exercise discretion and grant Brooks leave to appeal nunc pro
tunc from the judge's decision to transfer. We note that we
remain "less tolerant when an aggrieved party has mistakenly
filed a notice of appeal and the opponent has mistakenly failed
to move for dismissal." Grow Co., Inc. v. Chokshi, 403 N.J.
Super. 443, 459 (App. Div. 2008). Our "preference is to dismiss
the appeal of an interlocutory order that has been filed without
[the court's] leave." Id. at 463. However, "upon good cause
shown and an absence of prejudice, we may '[g]rant leave to
appeal from an interlocutory order, decision or action, provided
that the appeal was in fact taken within the time for appeals
from judgments, decisions or actions.'" N.J. Mfrs. Ins. Co. v.
Prestige Health Group, LLC, 406 N.J. Super. 354, 359 (App. Div.)
(quoting R. 2:4-4(b)(2)), certif. denied, ___ N.J. ___ (2009).
An appellant must show, at a minimum that the appeal has merit
and that justice mandates our interference. Grow Co., supra,
403 N.J. Super. at 461.
Here, Brooks filed both of its notices of appeal within the
forty-five day time period set forth in Rule 2:4-4(b)(2), and
more importantly, there is no forum that will now resolve its
private contract claims against Dobco, since the judge
transferred its complaint to the Board and did not retain
jurisdiction. The Board had previously concluded that it had no
jurisdiction to address any private contract claims.
We first address the issues raised by the appeal from the
judge’s transfer of the contract dispute to the Board. (A-5548
Brooks asserts that the judge erred by transferring its
private contract action against Dobco to the Board because:
(1) N.J.S.A. 18A:3B-6f does not grant "exclusive jurisdiction"
on the College to hear the breach of contract action raised in
the complaint; (2) the College's informal hearing process did
not provide the necessary due process; and (3) the complaint
alleged a viable claim against Dobco. As we agree that
jurisdiction of the contract dispute was properly in the Law
Division, we need only address Brooks’s first argument.
Subject-matter jurisdiction rests upon the court or the
agency having been granted such power by the Constitution or by
valid legislation. It cannot be vested by agreement of the
parties. State v. Osborn, 32 N.J. 117, 122 (1960). Where "the
Legislature vests an administrative agency with exclusive
primary jurisdiction, that agency may be the only forum in which
a party initially may seek relief." Campione v. Adamar of N.J.,
Inc., 155 N.J. 245, 261 (1998). Essentially, the Legislature
has preempted the court's original jurisdiction over the subject
matter. Ibid. "A plaintiff may not seek relief in the trial
court when the Legislature has vested exclusive primary
jurisdiction in an agency." Town of Kearny v. Hackensack
Meadowlands Dev. Comm'n, 344 N.J. Super. 55, 60 (App. Div. 2001)
(citing Abbott v. Burke, 100 N.J. 269, 297 (1985)).
However, unlike exclusive jurisdiction, primary
jurisdiction presumes that the claim is properly before a court
but allows the court to defer its decision pending a decision
from an administrative agency on "threshold issues, usually of a
factual nature, which are placed within the special competence
of the administrative body." Unalachtigo Band of Nanticoke-
Lenni Lenape Nation v. State, 375 N.J. Super. 330, 345 (App.
Div.) (quoting Golden Hill Paugussett Tribe of Indians v.
Weicker, 39 F.3d 51, 58-59 (2d Cir. 1994)), certif. denied, 184
N.J. 210 (2005). The doctrine of primary jurisdiction addresses
the relationship between courts and agencies in cases where the
claims asserted implicate issues within the scope of the
agency's regulatory authority. Campione, supra, 155 N.J. at
263-64. Accord Nader v. Allegheny Airlines, Inc., 426 U.S. 290,
303, 96 S. Ct. 1978, 1986, 48 L. Ed. 2d 643, 654 (1976); Abbott,
supra, 100 N.J. at 300 n.5; Archway Programs, Inc. v. Pemberton
Twp. Bd. of Educ., 352 N.J. Super. 420, 425-26 (App. Div. 2002).
We have defined primary jurisdiction "as the circumstance in
which a 'court declines original jurisdiction and refers to the
appropriate body those issues which, under a regulatory scheme,
have been placed within the special competence of an
administrative body.'" Muise, supra, 332 N.J. Super. at 158
(quoting Daaleman v. Elizabethtown Gas Co., 77 N.J. 267, 269 n.1
(1978)). The purpose of the doctrine is twofold: (1) to allow
an agency to apply its expertise to questions that require
interpretation of its regulations; and (2) to preserve
uniformity in the interpretation and application of an agency's
regulations. Id. at 159-60. In Muise, we set forth a four-
pronged test to determine the application of the doctrine of
1) whether the matter at issue is within the
conventional experience of judges;
2) whether the matter is peculiarly within
the agency's discretion, or requires agency
expertise; 3) whether inconsistent rulings
might pose the danger of disrupting the
statutory scheme; and 4) whether prior
application has been made to the agency.
[Id. at 160.]
Contrary to Brooks's assertion, the judge did not find that
N.J.S.A. 18A:3B-6f bestows exclusive jurisdiction on a college
to hear all breach of contract claims arising from its bidding
process. Instead, he concluded "that primary jurisdiction lies
with the Board" for all actions brought pursuant to that statute
and that "the central issues" in Brooks's complaint "arise out
of Title 18A."
A review of the statutory language is instructive.
N.J.S.A. 18A:3B-6f (emphasis added) confers primary jurisdiction
on College boards and gives them the "final authority to
determine controversies and disputes concerning . . . issues
arising under Title 18A involving higher education . . . ."
The issue before the Law Division and now before us is
whether the dispute between Dobco and Brooks is an "issue
arising under Title 18A involving higher education." Brooks
asserts that the Board was not authorized to hear the private
contract dispute because it does not involve higher education.
Dobco counters that the Board was authorized to hear the dispute
because it involves a bidding matter that arises under Title 18A
in the County College Contracts Law, specifically, N.J.S.A.
In our view, the action between Brooks and Dobco neither
involves higher education nor arises under the County College
Contracts Law, even considering the Legislature's broad intent
in N.J.S.A. 18A:3B-2b to eliminate "unnecessary State oversight"
of those institutions, and in N.J.S.A. 18A:3B-2e to give them
"greater decision making and accountability." While the Board
had primary jurisdiction under N.J.S.A. 18A:3B-6f to determine
if Dobco's substituting another subcontractor for Brooks in its
awarded contract was reasonable pursuant to the terms of that
contract, that statute, even read broadly, grants the College no
authority or special expertise to apply general contract law and
determine if Dobco's private actions towards Brooks had breached
an alleged contract between them that was outside the bidding
process, the award, and the ultimate contract between the
College and Dobco.
An action for damages on breach of contract is "a subject
matter fully within the jurisdiction of the Superior Court."
McKeeby v. Arthur, 7 N.J. 174, 181 (1951). See Normand v.
Lindhaven Homes, 131 N.J. Eq. 470, 472 (E. & A. 1942) (noting
that claims "amount to a breach of contract and a law court has
exclusive jurisdiction"); Schweitzer v. Nat'l House & Farms
Ass'n, 93 N.J. Eq. 644, 646 (E. & A. 1922) (indicating that
"[b]ut for a breach of contract, and nothing more, the law
courts have exclusive jurisdiction."). Furthermore, as Brooks
correctly asserts, the Board has no authority to grant a damages
award should Brooks prevail on its complaint against Dobco.
"[A] court can consider all judicial remedies, including
damages, which are beyond the agency's authority[.]" Muise,
supra, 332 N.J. Super. at 163. Consequently, Brooks had never
applied to the Board for any disposition of its contract claims;
rather, it was Dobco who sought resolution from the Board.
We conclude that the Board has no jurisdiction to resolve
any damages action for breach of an alleged contractor-
subcontractor contract, and we reverse the judge's order
transferring Brooks's complaint to the Board for resolution. As
we have noted, our determination of this threshold
jurisdictional argument precludes any necessity to consider the
hearing procedures before the Board. On remand to the Law
Division, Brooks will be afforded its opportunity to present the
extant issues in dispute on the contract claim.
We now address the issues related to the Board’s
determination that Dobco could properly substitute a
subcontractor in place of Brooks. (A-5395-07T2). On this
appeal, Brooks contends that the Board erred by finding (1) that
Dobco had not violated public bidding laws by bid shopping the
HVAC and plumbing subcontracts after the contract was awarded;
and (2) that Dobco's substitution request was reasonable.
Critical to our resolution of this appeal is our standard
of review. The College "is a political subdivision established
by Bergen County pursuant to legislative authorization, N.J.S.A.
18A:64A-1 [to -25], but serving a separate purpose and operating
apart from the county government." Bd. of Trs. of Bergen Cmty.
Coll. v. J.P. Fyfe, Inc., 192 N.J. Super. 433, 436 (App. Div.
1983), certif. denied, 96 N.J. 308 (1984). See N.J.S.A.
18A:64A-11 (noting that a board of trustees is "a body
corporate"). As with other municipal bodies, a reviewing court
cannot overturn the Board's decision unless it was arbitrary,
capricious, or unreasonable. Palamar Constr., Inc. v. Twp. of
Pennsauken, 196 N.J. Super. 241, 250 (App. Div. 1983). The
court is "bound by the record" before the Board. Ibid.
Brooks first asserts that the Board erred by permitting the
substitution. Brooks claims that the record supports a finding
of Dobco's illegal bid shopping. It argues that N.J.S.A.
18A:64A-25.25 must be read strictly to preclude all post-award
changes and substitutions to the list of subcontractors that any
general contractor submits with its bid documents. It asserts
that such changes must lead to a presumption of illegal bid
shopping since they dilute the statutory bidding requirements
Our determination that Brooks's breach of contract claim
must be considered in the Law Division is relevant to the
consideration of the issues on this appeal, and the issues to be
determined in the Law Division inform our determination.
While both parties focus on the impact of N.J.S.A. 18A:64A-
25.25, our review leads us to conclude that we need only address
the issue of Brooks's refusal to accede to Dobco's demand of
performance surety, as this is sufficient to meet the statutory
mandate of N.J.S.A. 18A:64A-25.25.
As we have noted, the hearing before the Board was non-
adversarial and prompted numerous factual findings that
supported the Board's determination of no bid-shopping and a
proper substitution. The issues of whether or not there was bid
shopping, which in Brooks's view is the critical factor in the
substitution determination, will be subsumed and considered by
the Law Division in determining the merits of the breach of
contract action. The question, which is a mixed issue of law
and fact and which is challenged factually by both parties, will
warrant appropriate procedural safeguards, including the
possibility of an adversarial hearing, that were not apparent in
the hearing before the Board.
Here, the only undisputed fact before the Board was that
Brooks had refused Dobco's post-award request that it provide a
The ability to perform a public contract is critical to the
welfare of the taxpayers funding the contract. Demanding
performance security insures that result. A contractor's
ability to perform the required work is of the very essence of
any contract for public work. Donald F. Begraft, Inc. v.
Borough of Franklin Bd. of Educ., 133 N.J. Super. 415, 417 (App.
While the parties focus on general compliance with the
bidding process, the true focus in this case should be on the
ability to perform a public contract that has been awarded.
Brooks's refusal to provide a bond compromises its ability to
Contractors can make changes to the subcontractors listed
in their bids for performance reasons, especially when
protecting the public interest. In O'Shea v. N. J. Schools
Constr. Corp., 388 N.J. Super. 312, 315 n. 1 (App. Div. 2006),
where we overturned a policy allowing substitution after the
award of bids, we stated that our "opinion [did] not affect a
general contractor's remedies if a subcontractor breaches after
a contract between the general contractor and the subcontractor
has been signed." In Stano, supra, 187 N.J. Super. at 534 n.3,
we refused to hold that invalidation of a contract would follow
in all instances "where a proposed subcontractor named in the
bidding papers becomes unavailable for some reason after the
award[.]" Finally, in Serenity Contracting Group, Inc. v.
Borough of Fort Lee, 306 N.J. Super. 151, 157 (App. Div. 1997),
certif. denied, 153 N.J. 214 (1998), we declared that there were
no bidding statutes that "suggest a legislative design to
supplant all exercises of principled business judgment by the
contracting public entity that conform with the express
provisions of the Law and its underlying policies."
We reject Brooks’s reliance on Gaglioti Contracting, Inc.
v. City of Hoboken, 307 N.J. Super. 421 (App. Div. 1997), and
Prismatic Dev. Corp. v. Somerset County Bd. of Chosen
Freeholders, 236 N.J. Super. 158 (App. Div.), certif. denied,
118 N.J. 205 (1989), overruled on other grounds by Meadowbrook
Carting, supra, 138 N.J. at 320. Gaglioti involved a failure
of a general contractor to furnish a list of its subcontractors
in its bid proposal, while in Prismatic, we rejected the
practice of identifying more than one subcontractor in a general
contractor’s bid proposal for individual specialty trades.
Neither circumstance is present here.
Although we need not address the factual assertions
submitted by Brooks in claiming that: (1) Brooks never received
a copy of Dobco's March 5 letter requesting substitution until
after the architect made his decision to allow the substitution;
(2) Dobco never provided the architect with all of the
correspondence that had been exchanged between the parties so
that it could make an informed decision; (3) Dobco never told
the architect that Brooks had just successfully performed a
project for the North Haledon Board of Education or that
Brooks's initial estimate to Dobco had provided for no bond to
be submitted; and (4) the architect never did any investigation
into the facts surrounding the actual contractor-subcontractor
relationship, we note that the facts do not support the claims.
For example, Brooks's March 18 letter to the College
indicated that it knew Dobco had requested to substitute another
subcontractor. Finally and most important, it is undisputed
that Brooks had refused to submit a performance payment bond.
In sum we conclude that it was within the College's business
judgment to approve Dobco's substitution request based on the
failure to provide performance security, and that the Board's
approving that decision was not unreasonable, arbitrary or
We reverse and remand in Docket No. A-5548-07T2; we affirm
in Docket No. A-5395-07T2.