Synergy Project Mgmt., Inc. v. City & Cnty. of S.F.

The Subletting and Subcontracting Fair Practices Act ( Pub. Contract Code, § 4100 et seq. ) (Act), which governs public works projects, was enacted to protect the public and subcontractors from bidding practices that "often result in financial difficulties for subcontractors and poor workmanship on public improvements." 1 ( Cal-Air Conditioning, Inc. v. Auburn Union School Dist. (1993) 21 Cal.App.4th 655 , 660, 26 Cal.Rptr.2d 703 ( Cal-Air Conditioning ).) To this end, section 4107, subdivision (a) (section 4107(a)) requires a prime contractor to obtain the consent of the awarding authority before replacing a subcontractor listed in the original bid, and it limits the awarding authority's ability to consent to specified circumstances. If the original subcontractor objects to being replaced, section 4107(a) requires the awarding authority to hold a hearing "on the prime contractor's request for substitution."

In this case, the City and County of San Francisco (City) entered a contract with prime contractor Ghilotti Bros., Inc. (Ghilotti) for a major renovation of Haight Street. Consistent with its accepted bid, Ghilotti entered a contract with subcontractor Synergy Project…