Matter of: Tilley Constructors & Engineers, Inc. File: B-251335.2 Date: April 2, 1993

Matter of: Tilley Constructors & Engineers, Inc. File: B-251335.2 Date: April 2, 1993

Procurement Sealed Bidding Bids Modification Acceptability Agency properly considered an unsigned, downward bid modification that yielded the low bid under an invitation for bids, since the bidder included this document in the bid envelope as part of the bid with other signed documents, such as the standard form 1442 and bid bond, that
clearly evidenced the bidder's intent to be bound by its modified bid
price.

Attorneys

DECISION Tilley Constructors & Engineers, Inc. protests the proposed
award of a contract to James Reeves Contractor, Inc. under invitation for
bids (IFB) No. N62467-89-B-0025, issued by the Department of the Navy,
Naval Facilities Engineering Command, for the construction of an academic
development center at Keesler Air Force Base, Biloxi, Mississippi. Tilley
claims that the agency improperly considered an unsigned, downward bid
modification included in Reeves's bid envelope in determining that Reeves
was the low bidder.

We deny the protest.

The Navy issued the IFB on September 25, 1992, and received 12 bids by
the November 17, 1992, bid opening date. Reeves submitted a single bid
envelope that included a Standard Form (SF) 1442, "Solicitation, Offer,
and Award," reflecting a bid in the amount of $3,030,550, an unsigned bid
modification deducting $38,000 from the bid price, an executed bid bond,
and an executed Certificate of Procurement Integrity. All of the documents
included in the bid package were dated November 17 and, except for the bid
modification, bore the signature of Graham Reeves, the firm's
Secretary/Treasurer. The bid modification included in the bid was a form
printed on Reeves's corporate letterhead that provided blanks for
inserting any changes to "the enclosed base bid" and included a signature
blank for Graham Reeves. The bid modification form contained the name and
address of the responsible contracting official, the solicitation number,
and the contract work description. Although this bid modification form was
unsigned, the agency waived this defect as a minor informality and
accordingly reduced Reeves's bid to $2,992,550. Reeves's bid modification
had the effect of displacing Tilley's bid in the amount of $3,003,000 as
the apparent low bid.

Tilley protests the Navy's determination to consider Reeves's unsigned
bid modification in determining its bid to be low. Tilley argues that the
absence of a signature on Reeves's bid modification creates an ambiguity
as far as Reeves's intent to perform at the lower bid price. This
ambiguity, according to the protester, provided Reeves an unfair
opportunity to select between its unmodified and modified bid prices after
other bids had been exposed. Since Reeves's bid allegedly suggests two
different bid prices, only one of which is low, the protester claims that
the agency was required to reject the ambiguous bid and recognize Tilley
as the low bidder.

An agency may not accept a bid that is ambiguous as to price unless the
bid remains low under the competing interpretations. Omni Elevator Co.,
B-241678, Feb. 25, 1991, 91-1 CPD Para. 207; Central Mechanical Constr.,
Inc., B-220594, Dec. 31, 1985, 85-2 CPD Para. 730. The mere allegation
that a bid is ambiguous does not make it so; an ambiguity only exists
where the bid lends itself to two or more reasonable interpretations.
Omni Elevator Co., supra; Hughes & Hughes/KLH Constr., 68 Comp.Gen. 194
(1989), 89-1 CPD Para. 61. Where a single rational explanation removes all
doubt as to the bidder's intended price, an agency may appropriately
accept the bid on the basis of that price. Omni Elevator Co., supra.

Here, we think there is no reasonable doubt but that Reeves intended to
be bound, and was in fact bound, by its modified bid price, not the bid
price stated on the SF-1442. The modification accompanied the signed bid
in the same bid envelope and referenced both "the enclosed base bid" and
the IFB itself. In addition, the modification appeared on Reeves's
corporate letterhead and provided a signature blank for Graham Reeves, the
same individual who signed the SF-1442, the bid bond, and the Certificate
of Procurement Integrity included in the same bid package. In our view,
these circumstances make clear that Reeves intended the agency to consider
the modification as part of its bid and removed any ambiguity as to the
intended bid price, notwithstanding that there was no signature on the bid
modification form.[1] In this regard, all documents submitted with a bid
must be considered part of the bid for purposes of determining the bid's
responsiveness or meaning. See General Elec. Co., 65 Comp.Gen. 377
(1986), 86-1 CPD Para. 223.

Tilley raises the concern that Reeves, after surveying bids at bid
opening, could have effectively repudiated its modified price and demanded
the higher price on the signed SF-1442, claiming that its failure to sign
the modification showed its intent not to be bound by it; this scenario
would adversely affect the integrity of the sealed bid system by
permitting a bidder to select after bids had been exposed which of two bid
prices is more to its advantage. We think the possibility that Reeves did
not intend to be bound by the modification letter is too remote to require
the rejection of its bid, and that there is no reason to believe that
Reeves would not be bound to a modification to its bid that it included as
part of its bid package. See generally 4 S. Williston, A Treatise on the
Law of Contracts, Sec. 628 (3rd Ed. 1961). In this regard, we note that
the modification was on Reeves's stationery, clearly referenced this IFB
and described how the bid price was to be modified; there is no evidence
that the modification was included in the sealed bid package accidently or
without authorization. Cf. Barnes Elec. Co., Inc., B-228651, Oct. 2, 1987,
87-2 CPD Para. 331 (unsigned bid modification on the outside of the bid
envelope cannot be considered). Thus, the scenario advanced by the
protester, whereby Reeves could elect after bid opening whether or not to
honor its lower bid price, is not a reasonable possibility in the present
circumstances.

In view of the foregoing, the agency properly waived Reeves's failure to
sign its bid modification as a minor informality, inasmuch as Reeves is
bound to the price on the modification included in the bid package. See
Omni Elevator Co., supra (bidder's failure to initial changes to its bid
prices is waivable as a minor informality, where the bid, when read as a
whole, makes clear that the bidder intended to be bound by its modified
bid prices).

The protest is denied.

1. It is true that unsigned bids or bid modifications generally must be rejected because, absent an appropriate signature, the bidder would not be bound should the government accept the bid. See Tomahawk Constr. Co., B-243582, Aug. 7, 1991, 91-2 CPD Para. 137; JRW Enters., Inc., B-238236, May 11, 1990, 90-1 CPD Para. 464. There is an exception to this rule permitting the agency to waive as a minor informality a bidder's failure to sign its bid or bid modification where, as here, the bid includes other documentation bearing the bidder's signature and identifying the bid itself that evidences the bidder's intent to be bound. Federal Acquisition Regulation Sec. 14.405(c)(1); Jennings Int'l Corp., 68 Comp.Gen. 79 (1988), 88-2 CPD Para. 472; Micon Corp., B-249231, Oct. 28, 1992, 92-2 CPD Para. 293. Although Reeves failed to sign the bid modification, which expressly referenced that it was intended to lower Reeves's base bid for this IFB, the awardee's bid also included a signed SF-1442 and a signed bid bond, each of which identified the IFB.