Miss. SC says no contract exists in land purchase

JACKSON, Miss. (Legal Newsline) - The Mississippi Supreme Court has found that the Mississippi Department of Environmental Quality did not create a contract with Pacific Chlorine Inc. by accepting a proposal from Pacific Chlorine for the purchase of contaminated land.

Vicksburg Chemical Company filed for bankruptcy in 2002 and, pursuant to an agreed order, the bankruptcy court allowed the company to abandon property, a portion of which was contaminated. The order stipulated that the MDEQ would have the power to choose the purchaser.

MDEQ published a Request for Proposals, to identify interested parties capable of purchasing the land and removing the contamination. Several companies, including Pacific Chlorine, Inc. and Harcros Chemicals, Inc. submitted proposals and Harcros was ultimately chosen.

PCI then sued both MDEQ and the City of Vicksburg, making several allegations that primarily relied on its assertion that its submitted proposal created a contract. The trial court found a contract had been created and awarded PCI $500,000 on various breach of contract related charges. MDEQ appealed to the Mississippi Supreme Court.

Justice Leslie D. King wrote for the Court, "The RFP clearly stated it was not a formal bidding process, and the selected proposal would receive only the right to enter further negotiations. This Court has held that no breach-of-contract claim exists where no contract is created."

On PCI's attempt to characterize the RFP as an express contract, King continued, "Even the selected proposal is not guaranteed a contract... Thus the trial court erred by finding that PCI had a viable breach-of-contract claim."

Having ruled there was no contract formed, the Court then proceeded to dispatch of the remaining contract related claims and to "reverse and render the trail court's judgment denying all relief sought by PCI and dismissing this action with prejudice."