B-176262(1), DEC 4, 1972

B-176262(1), DEC 4, 1972

BID PROTEST - BIDDER RESPONSIBILITY DECISION DENYING THE PROTEST OF R & O INDUSTRIES, INC., AGAINST REJECTION OF ITS BID UNDER AN IFB ISSUED BY GSA. DETERMINATION OF NON-RESPONSIBILITY WILL NOT BE QUESTIONED BY GAO UNLESS ARBITRARY, CAPRICIOUS OR NOT BASED ON SUBSTANTIAL EVIDENCE. B 170224, OCTOBER 8, 1960.

TO R & O INDUSTRIES, INC.:

REFERENCE IS MADE TO YOUR LETTER OF JUNE 13, 1972, PROTESTING AGAINST THE REJECTION OF YOUR BID FOR ITEMS 66, 67, 68, 77, AND 78 OF INVITATION FOR BIDS (IFB) FPNTP-A2-19262-A, ISSUED BY THE GENERAL SERVICES ADMINISTRATION (GSA).

THE IFB ANTICIPATED THE AWARD OF A REQUIREMENTS CONTRACT FOR CERTAIN HAND TOOLS. SINCE R & O WAS THE APPARENT LOW BIDDER ON ITEMS 66, 67, AND 68 (BUT NOT 77 AND 78) A PLANT FACILITIES REPORT WAS REQUESTED ON THE FIRM. THIS REPORT, AS WELL AS A LATER SUPPLEMENTARY REPORT, CONCLUDED THAT R & O WAS INCAPABLE OF PERFORMING THE ANTICIPATED CONTRACT AND SUCH DATA BECAME THE BASES FOR THE CONTRACTING OFFICER'S DETERMINATION THAT R & O WAS NONRESPONSIBLE UNDER FEDERAL PROCUREMENT REGULATIONS (FPR) 1-1.1203-1(C).

FOR ITS PART, R & O CONCEDES EXPERIENCING CONSIDERABLE DELINQUENCIES IN DELIVERY DURING THE LAST HALF OF 1971 AND FIRST QUARTER OF 1972 BUT CONTENDS THAT THE DELINQUENCIES WERE DUE TO AMERICAN AND JAPANESE DOCK STRIKES OVER WHICH IT HAD NO CONTROL AND FOR WHICH IT SHOULD NOT BE PENALIZED. THIS LATTER POINT, WE BELIEVE, SINCE R & O GIVES NO SPECIFICS, HAS REFERENCE TO THAT LANGUAGE OF FPR 1-1.1203-1(C) WHICH INDICATES THAT "CIRCUMSTANCES PROPERLY BEYOND THE CONTROL OF THE CONTRACTOR" MAY REMOVE THE PRESUMPTION THAT A CONTRACTOR WITH CURRENT OR RECENT PERFORMANCE DEFICIENCIES DOES NOT HAVE A SATISFACTORY RECORD OF PERFORMANCE.

THE INITIAL PLANT FACILITIES REPORT STATES THAT R & O WAS 74 PERCENT DELINQUENT ON CONTRACT GS-00S-86764 AND THAT MOST OF THE DELINQUENCY OCCURRED PRIOR TO THE AMERICAN DOCK STRIKE; THAT R & O WAS PRESENTLY DELINQUENT ON 60 OF 90 CONTRACTS "AND APPEARS TO BE LOSING, RATHER THAN GAINING, GROUND"; THAT THE RECENT (PRESUMABLY AMERICAN) DOCK STRIKE PREVENTED ASSURANCE THAT FOREIGN SOURCE MATERIAL WOULD BE AVAILABLE TO MEET THE ANTICIPATED DELIVERY SCHEDULE OF THE IFB; THAT R & O WAS OVERBURDENED WITH SHIPPING VARIOUS DELINQUENT ORDERS AS WELL AS MAINTAINING CURRENT OPERATIONS; AND THAT THERE HAD BEEN A DETERIORATION OF R & O'S QUALITY CONTROL SYSTEM AS INDICATED BY THE FACT THAT R & O WAS THEN INVOLVED IN 10 REPLACEMENT ACTIONS OCCASIONED BY QUALITY COMPLAINTS. THE SECOND PLANT FACILITIES REPORT RECONFIRMED THESE FINDINGS AND AN EVEN LATER (JUNE 26, 1972) STATUS REPORT INDICATED THAT 33 OF R & O'S 36 HAND TOOL CONTRACTS (I.E., 91.7 PERCENT OF THE CONTRACTS) REFLECTED DELINQUENT PURCHASE ORDERS. THIS STATUS REPORT ALSO STATES THAT DELIVERIES ON 80 OF 516 PURCHASE ORDERS HAD BEEN REJECTED FOR SPECIFICATION DEVIATION.

RECOGNIZING THAT THE DETERMINATION OF A BIDDER'S RESPONSIBILITY INVOLVES THE EXERCISE OF A CONSIDERABLE RANGE OF ADMINISTRATIVE DISCRETION, IT IS THE POSITION OF OUR OFFICE THAT DETERMINATIONS OF NONRESPONSIBILITY WILL NOT BE QUESTIONED UNLESS ARBITRARY, CAPRICIOUS, OR NOT BASED ON SUBSTANTIAL EVIDENCE. B-170224, OCTOBER 8, 1960. SEE ALSO B-176202, SEPTEMBER 26, 1972. WE DO NOT CONCLUDE THAT THERE HAS BEEN AN ABUSE OF DISCRETION IN THIS INSTANCE. WE MAY ASSUME THAT THE VARIOUS DOCK STRIKES PREVENTED THE RECEIPT OF MATERIALS FROM R & O'S JAPANESE SUPPLIER AND WERE EVENTS BEYOND R & O'S CONTROL. IT APPEARS, HOWEVER, FROM THE RECORD THAT R & O COULD HAVE UNDERTAKEN REMEDIAL ACTION TO ACCOMPLISH TIMELY PERFORMANCE OF THE OTHERWISE DELINQUENT CONTRACTS BY SEEKING ALTERNATIVE SOURCES OF SUPPLY. WHILE THIS COURSE OF ACTION MAY HAVE NECESSITATED THE SUBMISSION BY R & O OF PRODUCT SAMPLES FROM THE ALTERNATE SOURCE OF SUPPLY, THE BUY AMERICAN CERTIFICATE IN R & O'S BID INDICATED A SOURCE OF SUPPLY IN SPAIN AS WELL AS JAPAN. IN THIS REGARD, GSA OBSERVED THAT THERE WERE DOMESTIC SOURCES OF SUPPLY AS WELL. THERE IS NOTHING IN THE RECORD BEFORE US, HOWEVER, WHICH INDICATES THAT R & O MADE ANY ATTEMPT TO MEET THE PERFORMANCE REQUIREMENTS OF THE DELINQUENT CONTRACTS THROUGH ALTERNATE SOURCES OF SUPPLY.

WE DO NOT MEAN TO IMPLY THAT THE "CIRCUMSTANCES PROPERLY BEYOND THE CONTROL OF THE CONTRACTOR" NECESSARILY REFERS TO OR IS LIMITED BY THE EXCULPATORY CIRCUMSTANCES STATED IN THE DEFAULT CLAUSE. WE DO BELIEVE, HOWEVER, THAT THE LANGUAGE OF THAT CLAUSE PROVIDED, IN THIS INSTANCE, A READY GUIDE TO DETERMINE WHETHER R & O TOOK APPROPRIATE MEASURES TO MEET ITS OBLIGATIONS UNDER ITS PRIOR CONTRACTS. IT IS OUR OPINION, THEREFORE, THAT THE REFERENCED LONGSHOREMEN'S STRIKES DID NOT, IN AND OF THEMSELVES, PROVIDE A BASIS FOR EXCUSING R & O'S NONPERFORMANCE AND THAT NO BASIS EXISTS TO LEGALLY OBJECT TO THE DETERMINATION OF NONRESPONSIBILITY.

ACCORDINGLY, YOUR PROTEST IS DENIED.