Construction Law Toolbox

Past Performance of Newly Formed Company

Public agencies may use past performance to award a contract to the lowest and best bidder or reject a bid. Occasionally, construction companies may dissolve or form new companies. The reasons for a change in a company’s corporate structure may vary. However, the good and/or the bad may follow the newly formed company. This issue was addressed a number of years ago by the Mississippi Attorney General and the position explained as follows:

[I]f a bidder presenting a valid COR number is a company with which DFA/BOB has no past experience or past performance history, DFA/BOB may consider past experience with or past performance of the company from which the bidder originated, the bidder’s parent company, or the company with which the bidder merged, partnered, or changed names.

The Attorney General went on to state that a public agency can also reject an apparent low bidder "who submits a bid under the same COR number as its predecessor, predecessor in name, parent company, or merger/partner" where the public agency considers a poor past performer. [Link to AG Opinion No. 2003-649].

The important point to understand is that good and/or poor past performance follows the COR number which is held by the qualifying party.

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Biggs, Ingram & Solop, PLLC
Jackson
111 E. Capitol Street, Suite 101
Jackson, Mississippi 39201