B-163202, B-163204, MAR. 18, 1968

B-163202, B-163204, MAR. 18, 1968

TO MR. JACOB H. FISCHMAN:

REFERENCE IS MADE TO YOUR LETTER OF FEBRUARY 12, 1968, AND PRIOR CORRESPONDENCE, PROTESTING THE REJECTION OF THE LOW BIDS SUBMITTED BY ELECTROMAGNETIC INDUSTRIES, INC., UNDER MARINE CORPS INVITATIONS FOR BIDS M00027-67-B-0127 AND -0129, COVERING THE PROCUREMENT OF GENERATOR SETS, RELATED TECHNICAL AND PROVISIONING DOCUMENTATION, AND TRAINING IN THE MAINTENANCE AND REPAIR OF THE GENERATORS.

THE CLAUSES IN BOTH INVITATIONS ARE SUBSTANTIALLY ALIKE. FOR CONVENIENCE IN CONSIDERING THE PROTESTS, INVITATION -0127 HAS BEEN SELECTED AS ILLUSTRATIVE OF BOTH PROCUREMENTS.

THE INVITATION PROVIDES FOR AN OPTION TO PURCHASE TYPES AND QUANTITIES OF STOCK REPAIR PARTS DETERMINED TO BE NECESSARY TO SUPPORT THE GENERATORS IN ACCORDANCE WITH THE PROVISIONS OF MILITARY SPECIFICATION MIL-M-17993D/MC), WHICH CONTAINS THE MARINE CORPS UNIFORM PROVISIONING PROCEDURES FOR PROCUREMENTS WHERE REPAIR PARTS SUPPORT IS REQUIRED. PARAGRAPH (A) OF THE "GENERAL REQUIREMENTS" OF THE INVITATION PROVIDED THAT IT IS MANDATORY THAT THE DELIVERY OF SUCH STOCK REPAIR PARTS AS MAY BE ORDERED BE CONCURRENT WITH THE DELIVERY OF THE GENERATORS AND THAT THE DELIVERY REQUIREMENTS ARE PREDICATED UPON THE PROVISIONING CYCLE IN THE MILITARY SPECIFICATION. IT IS FURTHER STATED THAT IF A REVISED PROVISIONING SCHEDULE IS ESTABLISHED UNDER THE PROVISIONS OF THE MILITARY SPECIFICATION, THE CONTRACT DELIVERY SCHEDULE MAY BE ADJUSTED ACCORDINGLY. THE DELIVERY PROVISION IN THE INVITATION REQUIRES THAT THE FIRST GENERATOR PRODUCTION UNITS BE DELIVERED WITHIN 420 DAYS AFTER CONTRACT AWARD. THUS, IN THE EVENT THE STOCK REPAIR PARTS OPTION IS EXERCISED BY THE MARINE CORPS, REPAIR PARTS FOR THE FIRST PRODUCTION UNITS OF THE GENERATORS WILL BE REQUIRED TO BE DELIVERED WITH THOSE GENERATORS.

PARAGRAPH (B) OF THE "GENERAL REQUIREMENTS" SECTION OF THE INVITATION REQUIRED BIDDERS TO FURNISH IN BLANK SPACES PROVIDED THE TIME WITHIN WHICH PROVISIONING DOCUMENTATION WILL BE FURNISHED AND THE TIME WHEN STOCK REPAIR PARTS ORDERS WILL HAVE TO BE PLACED AFTER THE ACCEPTANCE OF THE PROVISIONING LIST BY THE MARINE CORPS IN ORDER TO ASSURE CONCURRENT DELIVERY OF GENERATORS AND SPARE PARTS. SPECIFICALLY, PARAGRAPH (B) STATED:

"/B): THE FOLLOWING SHALL BE COMPLETED BY THE BIDDER:

"/1): BIDDER REQUIRES THAT STOCK REPAIR PARTS ORDER/S) - ITEM 8, BE PLACED WITHIN ---------- CALENDAR DAYS AFTER SUBMITTAL AND ACCEPTANCE OF THE PROVISIONING LIST, IN ORDER THAT DELIVERY OF STOCK REPAIR PARTS MAY BE CONCURRENT WITH THE END ITEMS SPECIFIED UNDER PARA. (A) ABOVE. "BIDDER IS ADVISED THAT MARINE CORPS SUPPLY ACTIVITY, PHILADELPHIA, PENNSYLVANIA, REQUIRES 60 DAYS AFTER RECEIPT OF ACCEPTABLE PROVISIONING LIST TO DEVELOP AND SUBMIT THE RECOMMENDED STOCK REPAIR PARTS ORDER/S) TO THE CONTRACTING OFFICER. IN ADDITION, THE CONTRACTING OFFICER REQUIRES TIME NECESSARY TO NEGOTIATE MUTUALLY ACCEPTABLE PRICES AND TO ACCOMPLISH CONTRACTUAL AMENDMENT ACTION, PURSUANT TO THE CONTRACT CHANGES CLAUSE. "IN VIEW OF THE FACT THAT THE PROVISIONING CYCLE IS INITIATED BY SUBMITTAL OF ACCEPTABLE PROVISIONING DOCUMENTATION IN ACCORDANCE WITH MILITARY SPECIFICATION MIL-M-17993D/MC) AND AMENDMENTS THERETO: BIDDERS ARE REQUIRED TO COMPLETE THE FOLLOWING CERTIFICATION:

"/2): BIDDER CERTIFIES THAT THE PROVISIONING DOCUMENTATION, TO INCLUDE PROVISIONING LISTS WITH SUPPORTING DRAWINGS, APERTURE CARDS, AND VENDOR ITEMS CARDS, REQUIRED IN ACCORDANCE WITH MILITARY SPECIFICATION MIL-D- 17993D/MC) AND AMENDMENTS THERETO, WILL BE SUBMITTED WITHIN ------- * DAYS AFTER DATE OF CONTRACT. *DATE SPECIFIED MUST NOT EXCEED SIXTY (60) DAYS AFTER DATE OF FIRST ARTICLE ENVIRONMENTAL TEST APPROVAL.

"/3): BIDDER REQUIRES THAT STOCK REPAIR PARTS ORDER/S) - ITEM 11, BE PLACED WITHIN ------------ CALENDAR DAYS AFTER SUBMITTAL AND ACCEPTANCE OF PROVISIONING DOCUMENTATION UNDER ITEM 10, IN ORDER THAT DELIVERY OF STOCK REPAIR PARTS MAY BE CONCURRENT WITH THE END ITEMS SPECIFIED UNDER PARA. (A) ABOVE. "COMPLETION OF PARA. (B) (1/-/2) AND (3) ABOVE CONSTITUTES A CONTRACT DELIVERY REQUIREMENT AND BIDS SUBMITTED WITHOUT COMPLETION OF PARA. (B) (1/-/2) AND (3) ABOVE SHALL BE REJECTED AS NON-RESPONSIVE.'

ELECTROMAGNETIC INDUSTRIES INSERTED "360" IN THE BLANK SPACES IN PARAGRAPHS (B) (1) AND (B) (3). ALSO, IT CROSSED OUT THE WORD "SUBMITTAL" IN THE PHRASE "CALENDAR DAYS AFTER SUBMITTAL AND ACCEPTANCE" AND ADDED THE WORDS "CONTRACT DATE" IN LIEU OF THE DELETED WORD. THE SAME INSERTION AND CHANGES WERE MADE IN PARAGRAPH(B) (3) OF INVITATION -0129; HOWEVER, ELECTROMAGNETIC MADE NO DELETIONS IN PARAGRAPH (B) (1) OF THAT INVITATION BUT IT DID ADD THE WORDS "AFTER CONTRACT DATE" BETWEEN "CALENDAR DAYS" AND "AFTER SUBMITTAL AND ACCEPTANCE.' IN PARAGRAPHS (B) (2) IN BOTH INVITATIONS, IT INSERTED "420" IN THE BLANK SPACES.

IN ADDITION, IN THE SPACE PROVIDED IN INVITATION -0127 FOR A PRICE FOR ITEM 7, A MONTHLY PRODUCTION PROGRESS REPORT, ELECTROMAGNETIC PLACED A DASH. FOR THE MONTHLY PROGRESS REPORT IN INVITATION -0129, IT BID "0.'

THE MARINE CORPS REJECTED ELECTROMAGNETIC'S BIDS AS NONRESPONSIVE. THE BASIS FOR THE DETERMINATION WAS TWOFOLD. FIRST, THE INSERTION IN PARAGRAPH (B) (1) CHANGED THE GOVERNMENT'S OBLIGATION WITH RESPECT TO THE TIME FOR ORDERING STOCK REPAIR PARTS IN A MATERIAL RESPECT. SECOND, (B) (1) WAS IMPOSSIBLE OF PERFORMANCE INASMUCH AS THE BIDDER HAD INDICATED IN PARAGRAPH (B) (2) THAT THE FURNISHING OF THE PROVISIONING LIST -- A CONDITION PRECEDENT TO ORDERING SPARE PARTS -- WOULD BE WITHIN 420 DAYS AFTER THE CONTRACT DATE, THE DATE CONCURRENT DELIVERY OF FIRST GENERATORS AND SPARE PARTS, IF ORDERED, WAS REQUIRED. THE BID UNDER INVITATION -0127 WAS CONSIDERED TO BE FURTHER NONRESPONSIVE SINCE IT WAS NOT CONSIDERED CLEAR FROM THE INSERTION OF A DASH AFTER ITEM 7 IN THE BID THAT THE BIDDER INTENDED TO FURNISH MONTHLY PROGRESS REPORTS.

YOU HAVE CONTENDED THAT THE BIDS SHOULD NOT HAVE BEEN REJECTED AND THAT, AS A MINIMUM, THE PROCUREMENT SHOULD HAVE BEEN READVERTISED BECAUSE OF THE CONFUSION CREATED BY THE INVITATIONS. ALTHOUGH THE DELIVERY REQUIREMENTS PROVISION IN INVITATION -0127 REQUIRED DELIVERY OF THE FIRST PRODUCTION UNITS OF THE GENERATORS WITHIN 420 DAYS AFTER AWARD OF THE CONTRACT, YOU POINT OUT THAT UNDER PARAGRAPH (M) OF THE "FIRST ARTICLE APPROVAL" CLAUSE IN THE INVITATION, THE CONTRACTOR IS REQUIRED TO INSPECT AND TEST A PREPRODUCTION MODEL AND DELIVER TEST REPORTS TO THE MARINE CORPS WITHIN 340 CALENDAR DAYS AFTER THE DATE OF THE CONTRACT; AND THAT UNDER PARAGRAPH (1) THE MARINE CORPS HAS 30 DAYS AFTER RECEIPT OF THE TEST REPORTS TO ACCEPT THEM. YOU FURTHER CONTEND THAT UNDER PARAGRAPH (B) (2) OF THE "GENERAL REQUIREMENTS" 60 DAYS AFTER TEST APPROVAL HAS BEEN PROVIDED FOR THE SUBMISSION OF PROVISIONING DOCUMENTATION AND THAT UNDER PARAGRAPH (B) (1) OF THE "GENERAL REQUIREMENTS" IT IS PROVIDED THAT THE MARINE CORPS SUPPLY ACTIVITY REQUIRES 60 DAYS AFTER RECEIPT OF AN ACCEPTABLE PROVISIONING LIST TO SUBMIT THE RECOMMENDED REPAIR PARTS ORDER TO THE CONTRACTING OFFICER WITH THE RESULT THAT THE PROVISIONING CYCLE WOULD BE AT LEAST 490 DAYS. YOU STATE THAT THESE CIRCUMSTANCES WERE RESPONSIBLE FOR ELECTROMAGNETIC'S INSERTIONS IN THE "GENERAL REQUIREMENTS" SECTION OF THE INVITATION. FURTHER, YOU HAVE FURNISHED AFFIDAVITS FROM REPRESENTATIVES OF ELECTROMAGNETIC TO THE EFFECT THAT THESE MATTERS WERE DISCUSSED WITH THE CONTRACTING OFFICER BEFORE BIDDING AND THAT HE CONCURRED IN THE INSERTIONS AND INDICATED THAT THEY WOULD NOT MAKE THE BIDS NONRESPONSIVE. ADDITIONALLY, YOU HAVE POINTED OUT THAT THE PROCUREMENTS WERE TWO-STEP PROCUREMENTS AND THAT IN THE FIRST STEP OF THE PROCUREMENTS ELECTROMAGNETIC WAS FURNISHED SAMPLE COPIES OF THE INVITATIONS AND FURNISHED WITH ITS FIRST-STEP TECHNICAL PROPOSALS DELIVERY SCHEDULE CHARTS WHICH CONTAINED NOTES ON THE FACE STATING THAT UNDER THE REQUIRED SCHEDULING THE END ITEMS WOULD NOT RUN CONCURRENTLY. IN LIGHT OF THE FOREGOING, YOU SUGGEST THAT THE BIDS SHOULD NOT HAVE BEEN CONSIDERED NONRESPONSIVE.

THE MARINE CORPS HAS RESPONDED TO YOUR CONTENTIONS IN A REPORT OF JANUARY 31, 1968, A COPY OF WHICH HAS BEEN FURNISHED TO YOU BY OUR OFFICE. ESSENTIALLY, THE REPORT INDICATES THAT SOME OF THE TIME PERIODS REFERRED TO WERE WITHIN THE CONTROL OF THE BIDDERS AND COULD HAVE BEEN COMPRESSED BY THEM TO KEEP WITHIN THE 420-DAY DELIVERY REQUIREMENT. THE MARINE CORPS ALSO FURNISHED AFFIDAVITS DENYING THAT THE BIDDER'S REPRESENTATIVES WERE ADVISED TO BID IN THE MANNER DISCUSSED ABOVE. RATHER, THEY WERE INSTRUCTED TO WORK BACK FROM 420 DAYS IN COMPUTING THE NUMBER OF DAYS FOR INCLUSION IN PARAGRAPH (B) OF THE "GENERAL REQUIREMENTS.' FURTHER, THE MARINE CORPS HAS INDICATED THAT THE REVIEW OF THE TECHNICAL PROPOSALS IN THE FIRST STEP OF THE PROCUREMENT WAS DIRECTED TO DESIGN BUT THAT, IN ANY EVENT, THE TECHNICAL PROPOSALS FROM ELECTROMAGNETIC CONTAINED A STATEMENT THAT THE COMPANY COULD MEET THE REQUIRED DELIVERY SCHEDULES. IN THE CIRCUMSTANCES, IT IS CONTENDED THAT THE ELECTROMAGNETIC BIDS WERE PROPERLY REJECTED AS NONRESPONSIVE.

THE BIDDER'S STATEMENT IN PARAGRAPH (B) (1) IN INVITATION -0127 WAS TO THE EFFECT THAT THE BIDDER REQUIRES THE STOCK REPAIR PARTS ORDER "BE PLACED WITHIN 360 CALENDAR DAYS AFTER CONTRACT DATE AND ACCEPTANCE OF THE PROVISIONING LIST.' THE BIDDER'S STATEMENT IN PARAGRAPH (B) (1) IN INVITATION -0129 IS THAT THE BIDDER REQUIRES THAT THE ORDER "BE PLACED WITHIN 360 CALENDAR DAYS AFTER CONTRACT DATE AFTER SUBMITTAL AND ACCEPTANCE OF THE PROVISIONING LIST.' THE BIDDER'S STATEMENT IN PARAGRAPH (B) (2) IS THAT THE BIDDER CERTIFIES THAT THE PROVISIONING LIST WILL BE SUBMITTED WITHIN 420 DAYS AFTER THE CONTRACT DATE.

YOU HAVE REFERRED TO THE CANON OF CONTRACT CONSTRUCTION WHICH REQUIRES THAT NO PROVISION IN AN INSTRUMENT BE CONSTRUED IN CONFLICT WITH ANOTHER PROVISION UNLESS NO OTHER REASONABLE INTERPRETATION IS POSSIBLE. IN VIEW THEREOF, YOU SUGGEST THAT ELECTROMAGNETIC'S BIDS MUST BE CONSTRUED AS HAVING OFFERED TO FURNISH SPARE PARTS CONCURRENT WITH THE GENERATORS IF THE PARTS ARE ORDERED 360 DAYS AFTER CONTRACT AWARD, WHICH IS 60 DAYS PRIOR TO DELIVERY OF THE FIRST GENERATORS REQUIRED BY THE INVITATIONS FOR BIDS. YOU HAVE INTIMATED THAT SINCE THE BID REQUIRES THAT THE SPARE PARTS ORDERS BE PLACED WITHIN 360 DAYS AFTER THE CONTRACT AWARD AND ACCEPTANCE OF THE PROVISIONING LIST, THE FURNISHING OF THE PROVISIONING LIST NECESSARILY WILL PRECEDE THE PLACING OF THE ORDER AND WILL BE WITHIN THE FRAMEWORK OF THE REQUIREMENTS AND THAT THE EARLY FURNISHING WILL BE "WITHIN 420 DAYS," ALTHOUGH CONSIDERABLY LESS THAN THE OUTSIDE LIMIT.

HOWEVER, THE LAST PART OF PARAGRAPH (B) STATES THAT THE INFORMATION IN PARAGRAPH (B) CONSTITUTES A CONTRACT DELIVERY REQUIREMENT. FURTHER, IT IS TO BE NOTED THAT PARAGRAPH (B) (1) REQUIRED BIDDERS TO STATE WHEN THE ORDER FOR SPARE PARTS IS REQUIRED TO BE PLACED BY THE GOVERNMENT, WHEREAS PARAGRAPH (B) (2) REQUIRED BIDDERS TO STATE WHEN THE PROVISIONING LIST -- THE BASIS FOR ORDERING SPARE PARTS -- IS TO BE SUBMITTED BY THE BIDDER. THUS, WITH RESPECT TO (B) (2), WHILE ELECTROMAGNETIC HAS PROVIDED FOR DELIVERY OF THE PROVISIONING LIST WITHIN 420 DAYS AFTER THE CONTRACT DATE, THE ENTIRE 420 DAYS COULD BE EXPENDED IN SUBMITTING THE LIST. THIS INTERPRETATION PROPERLY MAY BE REGARDED AS DECISIVE OF THE MATTER, SINCE IF 420 DAYS ARE EXPENDED TO SUBMIT THE PROVISIONING LIST, DELIVERY OF SPARE PARTS CONCURRENT WITH THE PROVISIONS WOULD NOT BE POSSIBLE.

WHILE YOU STATE THAT THE BIDDER WAS CONFUSED AS TO WHEN DELIVERY WAS TO BE ACCOMPLISHED BECAUSE OF THE VARIOUS INTERIM TIMES PROVIDED FOR PERFORMANCE OF CERTAIN ASPECTS OF THE CONTRACT, THE ,DELIVERY REQUIREMENTS" SECTION OF THE INVITATION SPECIFICALLY PROVIDED THAT DELIVERY OF THE FIRST PRODUCTION UNITS IS TO BE MADE WITHIN 420 DAYS AND BIDDERS WERE ADVISED IN PARAGRAPH (A) OF THE "GENERAL REQUIREMENTS" THAT CONCURRENT DELIVERY OF STOCK REPAIR PARTS OPTIONS, IF EXERCISED, WITH END ITEMS WAS MANDATORY. IN VIEW OF THE MANDATORY REQUIREMENT FOR CONCURRENT END ITEM AND STOCK REPAIR PARTS DELIVERY AND SINCE VARIOUS OF THE TIME PERIODS, I.E., THE NUMBER OF DAYS FOR FURNISHING PREPRODUCTION SAMPLES FOR TESTING (340) AND THE NUMBER OF DAYS FOR FURNISHING A PROVISIONING LIST (60), COULD BE REDUCED BY THE BIDDER TO ASSURE COMPLIANCE WITH THE EXPRESSED NEED FOR CONCURRENT DELIVERY, THE BIDDER SHOULD HAVE REALIZED THE OVERRIDING SIGNIFICANCE OF THE 420-DAY DELIVERY DATE AND BID ACCORDINGLY.

YOU HAVE POINTED OUT THAT ELECTROMAGNETIC PROTESTED TO OUR OFFICE PRIOR TO AWARD AND YOU CONTEND THEREFORE THAT AN AWARD SHOULD NOT HAVE BEEN MADE UNTIL THE MATTER WAS RESOLVED BY OUR OFFICE. HOWEVER, ASPR 2-407.9 (B) (3) (I) PROVIDES FOR AN AWARD WHERE A WRITTEN PROTEST IS RECEIVED PRIOR TO AWARD WHEN THE CONTRACTING OFFICER DETERMINES THAT THE ITEMS TO BE PROCURED ARE URGENTLY REQUIRED. SUCH A DETERMINATION WAS MADE IN THIS CASE. THEREFORE, WE CANNOT SAY THAT THE AWARD IN THE FACE OF THE PROTEST WAS NOT APPROPRIATE. YOU HAVE CONTENDED THAT THE CONTRACTING OFFICER IN CONVERSATIONS WITH ELECTROMAGNETIC PERSONNEL AUTHORIZED ELECTROMAGNETIC TO BID IN THE MANNER IT PREPARED ITS BIDS AND THAT SUCH CONVERSATIONS SHOULD BE TREATED AS HAVING MODIFIED THE INVITATIONS FOR BIDS. HOWEVER, AS INDICATED ABOVE, THE CONTRACTING OFFICER HAS DENIED THAT ANY ASSENT WAS GIVEN TO ELECTROMAGNETIC TO BID IN THE MANNER IT CHOSE. MOREOVER, ARTICLE 3 OF THE SOLICITATION INSTRUCTIONS AND CONDITIONS PROVIDES THAT ,ORAL EXPLANATIONS OR INSTRUCTIONS GIVEN BEFORE THE AWARD OF THE CONTRACT WILL NOT BE BINDING.'

SINCE ELECTROMAGNETIC'S BIDS WERE NONRESPONSIVE BECAUSE OF THE RESPONSES MADE IN PARAGRAPH (B), WE NEED NOT DECIDE THE LEGAL EFFECT OF THE INSERTION OF A DASH FOR ITEM 7 IN INVITATION -0127.

THE ERRORS MADE BY ELECTROMAGNETIC AND OTHER BIDDERS APPEAR TO US TO HAVE RESULTED FROM THE FAILURE TO BID RESPONSIVELY TO A MATERIAL REQUIREMENT OF THE INVITATIONS, NAMELY, THE PROVISIONING CYCLES OF THE PROCUREMENTS. THE CIRCUMSTANCES, THE FAULT FOR THE ERRONEOUS BIDDING WAS ATTRIBUTABLE TO THE BIDDERS RATHER THAN TO THE GOVERNMENT. READVERTISING IS NOT REQUIRED NOR APPROPRIATE UNDER SUCH CIRCUMSTANCES.

FURTHER, AND PERHAPS MORE IMPORTANTLY, THE MARINE CORPS HAS ADVISED OUR OFFICE THAT BECAUSE OF RECENT INTERNATIONAL DEVELOPMENTS THE ITEMS BEING PROCURED ARE NOW OF SUCH CRITICAL URGENCY THAT FURTHER DELAYS CANNOT BE TOLERATED. THEREFORE, SOLELY AS A PRACTICAL MATTER, IT WOULD NOT BE IN THE GOVERNMENT'S INTEREST TO TAKE ANY ACTION ADVERSE TO THE AWARDS ALREADY ACCOMPLISHED UNDER THE INVITATIONS.