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                                                                                                                                            SECOND DIVISION
                                                                                                                                            Date Filed: December 27, 2005

No. 1-04-3180

This is the third appeal arising from a contract biddingdispute between the plaintiff, Keefe-Shea Joint Venture (Keefe-Shea), the defendant, the City of Evanston (Evanston), and theintervenor, DiPaolo Company (DiPaolo). Keefe-Shea appeals froman order of the circuit court of Cook County granting summaryjudgment to Evanston, denying Keefe-Shea's motion for summaryjudgment, denying its request for a preliminary injunction,denying it leave to amend its complaint and terminating thelitigation on the grounds of mootness.

On appeal, Keefe-Shea raises the following issues: (1)whether the circuit court erred when it denied Keefe-Shea'smotion for the entry of a preliminary injunction and failed toaward the Phase VI-B contract to Keefe-Shea; (2) whether thecircuit court erred when it granted Evanston's cross-motion forsummary judgment and denied Keefe-Shea's motion for summaryjudgment; (3) whether the circuit court erred when it dismissedKeefe-Shea's remaining claims as moot; and (4) whether thecircuit court erred when it denied Keefe-Shea's motion for leaveto amend its complaint. The pertinent history of this litigationis set forth below.

In 1991, Evanston began a multiphase relief storm sewerproject. The contract for Phase VI-B is at issue in this case. The contract was to be financed by a low interest rate loan fromthe Illinois Environmental Protection Agency (IEPA). In order toreceive the loan, Evanston agreed to be bound by the rules andregulations promulgated by the IEPA in relation to the loans itmakes.

In November 2000, Evanston solicited bids for Phase VI-B. The contract documents given to the prospective bidders wereprepared by Evanston and contained specifications with which aprospective bidder would be required to comply in the event itwas awarded the project. Pertinent to the issues in this appealwas the requirement that the bidder use minority and/or women-owned businesses (MBE/WBE) to perform no less than 15% of theawarded contract. With regard to the MBE/WBE participation,Evanston's contract documents provided that if the bidder wasunable to achieve the required MBE/WBE participation, the biddercould seek a waiver or modification of the utilization percentageby submitting a waiver request.

Both Keefe-Shea and DiPaolo submitted bids for the contract.Following a hearing, the Evanston city council voted to award thePhase VI-B contract to DiPaolo.

On March 27, 2001, Keefe-Shea filed suit against Evanston,alleging that Evanston was required by law and its own ordinancesto award the contract to the lowest responsible bidder. Thecomplaint further alleged that DiPaolo was not the lowestresponsible bidder due, inter alia, to its failure to comply withrequired procedure to obtain a MBE/WBE participation waiver. OnApril 20, 2001, DiPaolo was granted leave to intervene as adefendant. In its second amended complaint, filed on April 20,2001, Keefe-Shea sought temporary and permanent injunctive reliefto prevent Evanston from proceeding on the Phase VI-B projectwith DiPaolo, an order declaring that Keefe-Shea was the lowestresponsible bidder on the project and a mandatory injunctionrequiring Evanston to enter into a contract for Phase VI-B withKeefe-Shea.

On May 7, 2001, a hearing commenced on Keefe-Shea's motionfor a preliminary injunction. On May 11, 2001, at the close ofKeefe-Shea's case, the circuit court granted the motions ofEvanston and DiPaolo for a directed finding pursuant to section2-1110 of the Code of Civil Procedure (the Code) (735 ILCS 5/2-1110 (West 2000)). Keefe-Shea filed a timely interlocutoryappeal pursuant to Rule 307(a)(1) (188 Ill. 2d R. 307(a)(1)).

On August 29, 2001, this court vacated the circuit court'sorder granting the section 2-1110 motions and denying Keefe-Sheaa preliminary injunction. Keefe-Shea Joint Venture, Inc. v. Cityof Evanston, No. 1-01-2034 (2001) (unpublished order underSupreme Court Rule 23 (166 Ill. 2d R. 23)). The case wasremanded to the circuit court with instructions to the circuitcourt to make specific findings of fact and conclusions of lawand to set forth the reasons for its determinations as to each ofthe elements necessary for the granting of a preliminaryinjunction.

On November 20, 2001, the circuit court issued its writtenopinion denying the motion for a preliminary injunction. Keefe-Shea filed an interlocutory appeal from that denial.

In the second appeal, this court rejected the circuitcourt's determination that Keefe-Shea had not established a primafacie case as to the elements of irreparable harm and aninadequate remedy at law. This court held that an unsuccessfulbidder may establish the element of irreparable harm by evidencethat it was denied the right to participate in a fair biddingprocess and that the harm to bidders and the public alike wouldcontinue unabated unless the governmental body was enjoined frommaintaining an unfair bidding process. We concluded that Keefe-Shea had established a prima facie case that Evanston had notawarded the contract to the lowest, responsive, responsiblebidder based on DiPaolo's failure to comply with the MBE/WBEwaiver requirements. As a result, Keefe-Shea had no adequateremedy at law. Keefe-Shea Joint Venture v. City of Evanston,332 Ill. App. 3d 163, 175-77. 773 N.E.2d 1155 (2002).

Noting that the purpose of a preliminary injunction is topreserve the status quo pending a decision on the merits, thiscourt stated as follows:

"We conclude that the record presents a prima faciecase that [Keefe-Shea} would suffer the greater hardship ifthe preliminary injunction was denied and, therefore, apreliminary injunction is necessary in order to preserve thestatus quo. This determination is based upon the recordbefore us and does not and cannot consider any evidence thedefendants may present about the hardship to the citizens ofEvanston from the delay in constructing the relief stormsewer project." Keefe-Shea Joint Venture, 332 Ill. App. 3dat 178.

This court reversed the denial of the preliminary injunction andremanded the case "for a continuation of the hearing and thepresentation of evidence on behalf of Evanston and DiPaolo." Keefe-Shea Joint Venture, 332 Ill. App. 3d at 178.

This court's mandate was filed in the circuit court onNovember 4, 2002. On January 2, 2003, the circuit court grantedKeefe-Shea's motion to reopen limited discovery. On March 11,2003, the circuit court granted Keefe-Shea's motion to compelcompliance with all outstanding discovery. On May 19, 2003,Keefe-Shea filed a motion for leave to file a third amendedcomplaint. The proposed complaint added a count seeking adeclaration that the Phase VI-B contract between Evanston andDiPaolo was null and void. On June 19, 2003, the circuit courtgranted Keefe-Shea leave to file its third amended complaint. OnJuly 18, 2003, DiPaolo filed its answer, affirmative defenses anda counterclaim for declaratory judgment. On July 29, 2003, thecircuit court ordered, inter alia, all outstanding discovery,including witness lists, to be complied with by August 19, 2003.

On October 8, 2003, Evanston sought leave to file itsverified counterclaim for a declaratory judgment that it had theright to terminate the Phase VI-B contract pursuant to article108.12 of the Illinois Department of Transportation's StandardSpecifications for Bridges and Road Construction (1997) and theIllinois Administrative Code (35 Adm. Code