Section 2.1.4 Public Contract Formation

• Library: Construction Law Practice Manual 3rd Edition 2016

§ 2.1.4 Public Contract Formation

As with private contracts, formation of a public contract requires an offer and acceptance.²⁴ Without an offer and acceptance, no public contract is formed.²⁵ This principle seems basic, but the overlay of the public bidding process sometimes has obscured it and occasionally has led a contractor or vendor mistakenly to believe that it had formed a contract simply because it had submitted the low bid. In this situation, the contractor in effect has assumed that the advertisement constituted the public owner’s offer and that its bid equaled an acceptance. Not so. The effect of a bid to a public agency has been described as follows:

[A]n ordinary advertisement for bids or tenders is not itself an offer but the bid or tender is an offer which creates no right until accepted. Even...