B-151276, JUL. 8, 1963

B-151276, JUL. 8, 1963

TO MR. JOSEPH N. FUTOWSKY:

REFERENCE IS MADE TO YOUR LETTERS DATED JUNE 3 AND 13, 1963, REQUESTING RECONSIDERATION OF OUR DECISION OF MAY 28, 1963, IN WHICH WE DENIED THE PROTEST OF YOUR CLIENT, C. G. SCHMIDT, INC., AGAINST THE PROPOSED AWARD OF A CONTRACT TO AKWA CONSTRUCTION CO., INC., UNDER INVITATION FOR BIDS NO. ENG-11-032-63-30.

THE FACTS AND CIRCUMSTANCES SURROUNDING THIS CASE WERE SET FORTH IN DETAIL IN OUR DECISION OF MAY 28 AND WILL NOT BE REPEATED HERE EXCEPT WHEN NECESSARY TO THE PRESENT DISCUSSION.

YOU CONTEND THAT PARAGRAPH 5 (B) OF STANDARD FORM 22, WHICH WAS A PART OF THE SUBJECT INVITATION FOR BIDS, IN CONTROLLING AND, IN EFFECT REQUIRES REJECTION OF AKWA CONSTRUCTION COMPANY'S BID. YOU STATE THAT IN REEXAMINING THE PRICE SCHEDULES IT SEEMS TO YOU THAT IT MUST HAVE BEEN PART OF THE CONSIDERED JUDGMENT OF THE ARMY ENGINEER CORPS TO POSSIBLY AWARD CONTRACTS FOR EACH ITEM LISTED, OTHERWISE WHY WOULD THEY HAVE TO HAVE AN ITEMIZED BREAKDOWN OF PRICES. IT ALSO APPEARS TO YOU THAT EACH OF THE ITEMS "COULD OF NECESSITY BE AWARDED TO SEPARATE CONTRACTORS ON THE BASIS OF LOW BIDS FOR EACH ITEM.'

YOU CONTEND THAT IT IS EMINENTLY UNFAIR TO BIDDERS WHO HAVE SUBMITTED THEIR BIDS IN COMPLETE CONFORMITY WITH THE BID PRICE SCHEDULE TO THEN BE TOLD THAT IT MAKES NO DIFFERENCE IN THE FINAL ANALYSIS BECAUSE A LUMP SUM BID IS THE ONLY THING THAT WAS NECESSARY. YOU, ALSO, STATE THAT HAD A LUMP SUM BID BEEN DESIRED, IT SHOULD HAVE BEEN REQUESTED, IN WHICH CASE YOUR CLIENT'S WORK WOULD HAVE BEEN MUCH SIMPLER AND PERHAPS HIS PRICE MIGHT HAVE BEEN LOWER IF HE KNEW HE WERE GOING TO GET THE ENTIRE JOB.

FINALLY YOU STATE THAT OUR DECISION, IN EFFECT, HELD THAT PARAGRAPH 5 (B) WAS AMENDED BY NOTE 2 AND YOU CANNOT SEE WHERE NOTE 2 AMENDS OR ALTERS ANYTHING CONTAINED IN PARAGRAPH 5 (B). YOU POINT OUT THAT NOTE 2 MERELY STATES THAT FAILURE TO SUBMIT ITEMIZED BIDS FOR SCHEDULE "F" WILL CONSTITUTE AN INCOMPLETE BID WHICH WILL BE REJECTED AND DOES NOT STATE THAT THE BID PRICE SCHEDULE MAY BE SUBMITTED IN LUMP SUM FORM WITHOUT REGARD FOR ITEMS 1, 2 AND 3 OF SCHEDULES "A" AND "B.'

AT THE OUTSET IT SHOULD BE NOTED THAT OUR DECISION OF MAY 28 DID NOT HOLD THAT PARAGRAPH 5 (B) OF STANDARD FORM 22 WAS AMENDED BY NOTE 2, NOR DID WE BASE OUR DECISION OF THAT GROUND. SPECIFICALLY WE STATED THAT IN VIEW OF THE PROVISIONS OF NOTE 2 THERE WAS "SOME QUESTION AS TO THE LEGAL EFFECT THAT SHOULD BE GIVEN THE PROVISION IN PARAGRAPH 5 (B) THAT FAILURE TO BID ON ALL ITEMS WHERE REQUIRED WILL DISQUALIFY THE BID.' OUR DECISION DULY NOTED THE CONTRACTING OFFICER'S OPINION THAT NOTE 2 AMENDED PARAGRAPH 5 (B) AND WE STATED THAT:

"* * * WHILE WE THINK THE CONTRACTING OFFICER'S POSITION HAS MERIT WE NEED NOT, AND DO NOT, REACH OUR DECISION ON THIS BASIS * * *"

ON THE CONTRARY, THE BASIS FOR OUR DECISION WAS NOT THAT NOTE 2 AMENDED PARAGRAPH 5 (B) AND WAS CONTROLLING, BUT THAT THE FAILURE OF AKWA TO SUBMIT ITEM PRICES ON SCHEDULES "A" AND "B" WAS A MINOR DEVIATION NOT AFFECTING THE PRICE, QUANTITY OR QUALITY OF THE WORK SPECIFIED IN THE INVITATION AND COULD BE WAIVED. SUCH WAIVER WAS EXPRESSLY PROVIDED FOR BY THE TERMS OF PARAGRAPH 10 (B) WHICH, LIKE PARAGRAPH 5 (B), WAS CONTAINED IN STANDARD FORM 22.

WITH RESPECT TO YOUR CONTENTIONS THAT IT MUST HAVE BEEN PART OF THE CONSIDERED JUDGMENT OF THE ARMY ENGINEER CORPS TO POSSIBLY AWARD CONTRACTS FOR EACH ITEM LISTED, WE NOTED THAT VARIOUS PROVISIONS OF THE INVITATION INDICATED THAT AWARD OF A CONTRACT, OR CONTRACTS, WAS TO BE MADE BY SCHEDULES AND NOT ON THE BASIS OF SEPARATE ITEMS UNDERA PARTICULAR SCHEDULE. IN THAT CONNECTION, THE CONTRACTING OFFICER REPORTED THAT ALTHOUGH A PRICE BREAKDOWN MIGHT HAVE BEEN DESIRED FOR ADMINISTRATIVE PURPOSES, IT WAS NOT OF ANY SIGNIFICANCE IN DETERMINING THE LOW BIDDER AND THAT THE FAILURE TO FURNISH SEPARATE PRICES FOR EACH ITEM DID NOT GIVEN AKWA ANY ADVANTAGE OVER OTHER BIDDERS. WE CONCLUDED THAT THE RECORD BEFORE US SUPPORTED THE CONTRACTING OFFICER'S REPORT IN THIS RESPECT. THE OTHER HAND, YOU HAVE NOT SHOWN HOW YOUR CLIENT WAS INJURED OR PLACED IN A DISADVANTAGEOUS POSITION BY AKWA'S FAILURE TO SUBMIT UNIT PRICES, NOR DO WE SEE HOW SUCH A SHOWING IS POSSIBLE, IN VIEW OF THE FACT THAT BIDS WERE EVALUATED ON THE BASIS OF TOTAL SCHEDULE PRICES RATHER THAN ON THE BASIS OF ITEM PRICES.

THE CONCEPT OF FORMAL ADVERTISING, INSOFAR AS IT RELATES TO THE SUBMISSION AND EVALUATION OF BIDS, GOES NO FURTHER THAN TO GUARANTEE EQUAL OPPORTUNITY TO COMPETE AND EQUAL TREATMENT IN THE EVALUATION OF BIDS. DOES NOT CONFER UPON BIDDERS ANY RIGHT TO INSIST UPON THE ENFORCEMENT OF PROVISIONS IN AN INVITATION, THE WAIVER OF WHICH WOULD NOT RESULT IN AN UNFAIR COMPETITIVE ADVANTAGE TO OTHER BIDDERS OR WOULD NOT PERMIT A BID PRICE TO BE EVALUATED UPON A BASIS UNCOMMON TO ALL BIDS. SEE 40 COMP. GEN. 321. THE PROVISIONS OF PARAGRAPH 5 (B) WERE CLEARLY INSERTED IN THE INVITATION FOR THE PROTECTION OF THE GOVERNMENT'S INTERESTS AND THEIR ENFORCEMENT OR WAIVER HAS NO EFFECT UPON THE RIGHTS OF YOUR CLIENT TO WHICH THE LAWS GOVERNING FORMAL ADVERTISING ARE DIRECTED. TO HOLD OTHERWISE, WOULD BE TO AUTHORIZE AWARD TO A HIGHER BIDDER FOR PURPOSES OF ENFORCING A PROVISION IN AN INVITATION WHICH, IF WAIVED, RESULTS IN NO DISADVANTAGE TO THE HIGHER BIDDER--- AND, IF NOT WAIVED, WOULD OPERATE TO FORECLOSE AND IGNORE THE RIGHTS AND INTERESTS OF THE GOVERNMENT. WHILE WE RECOGNIZE THAT THE BID INVITATION IN THIS CASE COULD HAVE BEEN DRAWN WITH MORE PRECISION SO AS TO COMPLETELY ELIMINATE ANY UNCERTAINTY IN THE REQUIREMENTS FOR SUBMISSION OF BIDS, WE DO NOT THINK THAT THE INVITATION, AS DRAWN, CAUSED YOUR CLIENT, OR OTHER BIDDERS, TO SUFFER ANY ACTUAL PREJUDICE OR INEQUITABLE TREATMENT.

ONE FINAL MATTER SHOULD BE CLEARED UP. ON JUNE 11, IN RESPONSE TO YOUR REQUEST FOR RECONSIDERATION OF OUR MAY 28 DECISION, WE INFORMED YOU THAT YOUR REQUEST WOULD BE HONORED AND THE MATTER CAREFULLY RECONSIDERED. YOUR LETTER OF JUNE 13, YOU STATE THAT IT HAD COME TO YOUR ATTENTION THAT THE CONTRACT IN QUESTION HAD BEEN AWARDED ON JUNE 11 TO AKWA. YOU SAY THAT THE AWARD TO AKWA SEEMS TO BE RATHER INCONGRUOUS IN VIEW OF OUR LETTER TO YOU AND OUR ADVICE THAT THE MATTER WOULD BE RECONSIDERED.

IT SHOULD BE POINTED OUT THAT OUR OFFICE, WHICH IS IN THE LEGISLATIVE BRANCH OF THE GOVERNMENT, IS COMPLETELY INDEPENDENT OF, AND SEPARATE FROM, THE DEPARTMENT OF THE ARMY AND THE CORPS OF ENGINEERS. IN THE PRESENT CASE THE CORPS OF ENGINEERS IS THE CONTRACTING AGENCY AND HAD FULL RESPONSIBILITY FOR DRAFTING AND ISSUING THE SUBJECT INVITATION FOR BIDS. MOREOVER, THE CONTRACTING AGENCY HAS THE RESPONSIBILITY AND AUTHORITY TO MAKE CONTRACT AWARDS. OUR OFFICE HAS JURISDICTION FOR SETTLING CLAIMS BY AND AGAINST THE GOVERNMENT AND FOR RENDERING DECISIONS PERTAINING, AMONG OTHER THINGS, TO THE LEGALITY OF PROPOSED PAYMENTS OF TRANSACTIONS WHICH INCLUDES DETERMINATIONS ON THE PROPRIETY OF PARTICULAR AWARDS, OR PROPOSED AWARDS, OF CONTRACTS.

EACH "BID" PROTEST FILED BEFORE OUR OFFICE IS CONSIDERED EXPEDITIOUSLY BUT WE HAVE NO AUTHORITY TO DIRECT A CONTRACTING AGENCY TO WITHHOLD AN AWARD OF A CONTRACT PENDING A DECISION BY US. OF COURSE, IF WE LATER FIND THAT PROCUREMENT LAWS HAVE BEEN VIOLATED WE CAN, AND FREQUENTLY DO, DIRECT THE CONTRACTING AGENCY TO CANCEL AN AWARD PREVIOUSLY MADE. HOWEVER, DURING THE PERIOD WHEN THE PROTEST IS BEFORE US FOR CONSIDERATION, THE AWARDING AGENCY HAS COMPLETE DISCRETION AND AUTHORITY TO PROCEED WITH AN AWARD. THUS, IN THE PRESENT CASE, THE CONTRACTING OFFICER, ALTHOUGH HE WITHHELD AWARD TO AKWA UNTIL WE RENDERED OUR DECISION, WAS NOT OBLIGATED TO DO SO. NOR WAS HE OBLIGATED TO WITHHOLD AWARD PENDING THE OUTCOME OF THE PRESENT RECONSIDERATION. WE TRUST THAT THIS INFORMATION WILL CLARIFY ANY MISUNDERSTANDING ON YOUR PART AS TO CONTRACT AWARD PROCEDURES AND THE ROLE OF OUR OFFICE IN CONNECTION THEREWITH.

IN VIEW OF THE FOREGOING, WE MUST CONCLUDE THAT OUR DECISION OF MAY 28 WAS CORRECT AND IS SUSTAINED.