B-182730, MAR 7, 1975

B-182730, MAR 7, 1975

1. DISTRICT OF COLUMBIA MAY DETERMINE TO WAIVE AS NEGLIGIBLE LOW BIDDER'S FAILURE TO ACKNOWLEDGE TWO ADDENDA TO IFB FOR PAVING AND CULVERT WORK WHICH REFERENCED NEW LABOR RATES FOR TRADE NOT TO BE USED IN WORK AND ADDED ITEM VALUED AT $570.00, IN VIEW OF OVERALL COST OF JOB ($278,000), DIFFERENCE BETWEEN TWO LOW BIDS ($20,000) AND FACT THAT RELATIVE STANDING OF BIDDERS WAS UNAFFECTED. 2. DOCTRINE OF EQUITABLE ESTOPPEL IS NOT FOR APPLICATION WHEN COMMUNICATIONS UPON WHICH PROTESTER ALLEGEDLY INCURRED COSTS IN CONTEMPLATION OF AWARD WERE NOT FROM OFFICIALS WITH AUTHORITY TO BIND GOVERNMENT AND PROTESTER NOT JUSTIFIED IN ACTING ON STRENGTH OF OFFICIAL'S APPARENT AUTHORITY.

FLIPPO CONSTRUCTION CO., INC.:

COUNSEL FOR FLIPPO CONSTRUCTION CO., INC. (FLIPPO), PROTESTS THE PROPOSED AWARD OF A CONTRACT BY THE GOVERNMENT OF THE DISTRICT OF COLUMBIA, DEPARTMENT OF HIGHWAYS AND TRAFFIC (DISTRICT), TO THE MARBO COMPANY, INC. (MARBO), FOR A CULVERT AND PAVING PROJECT UNDER INVITATION FOR BIDS 226-AA -02-0-4-KA.

BIDS WERE REQUIRED ON TWO ALTERNATE APPROACHES TO PERFORMING THE WORK. AS OF THE SEPTEMBER 18, 1974, BID OPENING, MARBO WAS THE APPARENT LOW BIDDER AT $278,035.00 FOR EACH ALTERNATE, WHILE FLIPPO WAS NEXT LOW AT $290,461.50 FOR ALTERNATE "A" AND $298,058.50 FOR ALTERNATE "B." OF THE THREE ADDENDA ISSUED, NUMBER 3 CONCERNED PREVAILING WAGE RATES, WHILE NUMBER 2 ADDED 57 LINEAR FEET OF 6-FOOT CHAIN LINK FENCE TO BE INSTALLED ATOP A WINGWALL. MARBRO DID NOT ACKNOWLEDGE ADDENDUM 2 OR 3. THEREFORE, THE CONTRACTING OFFICER PROPOSED TO REJECT MARBRO'S BID AS NONRESPONSIVE. AWARD FOR ALTERNATE "B" WAS THEREAFTER RECOMMENDED TO FLIPPO. THIS DECISION WAS COMMUNICATED ORALLY TO FLIPPO BY THE DEPUTY ASSISTANT DIRECTOR OF THE BUREAU OF DESIGN, ENGINEERING AND RESEARCH, DEPARTMENT OF HIGHWAYS AND TRAFFIC, FOR THE DISTRICT ON SEPTEMBER 26, 1974.

IT APPEARS THAT AWARD TO FLIPPO WAS DELAYED AS A RESULT OF ITS TARDINESS IN SUBMITTING THE AFFIRMATIVE ACTION PROGRAM REQUIRED BY THE DISTRICT. THIS MATTER WAS THE SUBJECT OF AN OCTOBER 17, 1974, LETTER FROM THE LABOR STANDARDS AND EQUAL EMPLOYMENT OPPORTUNITY COMPLIANCE OFFICER (COMPLIANCE OFFICER) TO FLIPPO, WHICH REFERENCED PRIOR REQUESTS FOR THE INFORMATION AS EARLY AS OCTOBER 3. THE LETTER ALSO CAUTIONED THAT FLIPPO'S FAILURE TO SUBMIT SUCH INFORMATION MIGHT CONSTITUTE CAUSE TO REJECT ITS BID. OCTOBER 18, 1974, COUNSEL FOR MARBRO WROTE THE CONTRACTING OFFICER TO SUGGEST THAT MARBRO'S FAILURE TO ACKNOWLEDGE ADDENDA 2 AND 3 COULD BE WAIVED AS A MINOR INFORMALITY. IT WAS NOTED THAT ADDENDUM 3 MODIFIED THE WAGE RATE FOR PLASTERERS, AND THE SCOPE OF WORK DID NOT NECESSITATE THE USE OF THE PLASTERER TRADE AND THAT THE APPROXIMATE ESTIMATED VALUE FOR THE CHAIN LINK FENCE ADDED BY ADDENDUM 2 WAS $570.00. WAIVER OF THE MARBRO FAILURE TO ACKNOWLEDGE THE ADDENDA WAS REQUESTED CONSIDERING THE VALUE OF THE WORK ADDED BY THE ADDENDA VIS-A-VIS THE TOTAL VALUE OF THE CONTRACT AND DIFFERENCE BETWEEN MARBRO'S AND FLIPPO'S BIDS.

THE CONTRACTING OFFICER REFERRED THE MATTER TO THE CORPORATION COUNSEL FOR THE DISTRICT. ON NOVEMBER 5, 1974, THE ASSISTANT CORPORATION COUNSEL, CHIEF, SPECIAL ASSIGNMENTS DIVISION, TRANSMITTED HIS CONCLUSION TO THE CONTRACTING OFFICER THAT THE FAILURE OF MARBRO TO ACKNOWLEDGE THE TWO ADDENDA WAS A MINOR INFORMALITY THAT COULD BE WAIVED WITHIN THE MEANING OF THE DISTRICT'S REGULATION, SEC. 2620.14 B(4)(B) OF THE MATERIEL MANAGEMENT HANDBOOK (MMH) (1974 ED.) AND 52 COMP. GEN. 544 (1973).

WHILE THE ASSISTANT CORPORATION COUNSEL CONSIDERED WHETHER MARBRO'S FAILURE TO ACKNOWLEDGE THE TWO ADDENDA WAS A MINOR INFORMALITY WITHIN THE MEANING OF SECTION 2620.14-B(4)(B) OF THE MMH, CONCERNING PROCUREMENT IN GENERAL, CONSIDERATION OF THE MATTER WOULD MORE PROPERLY HAVE FALLEN WITHIN THE PURVIEW OF SECTION 2642.2-2(6)(C)(2) CONCERNING "MINOR INFORMALITIES OR IRREGULARITIES IN BIDS" FOR PROCUREMENT OF CONSTRUCTION. BOTH REGULATIONS PERMIT WAIVER OR CORRECTION OF SUCH "MINOR MATTERS," SUCH AS THE FAILURE TO ACKNOWLEDGE RECEIPT OF AN AMENDMENT TO AN IFB, BUT ONLY IF IT HAS EITHER NO EFFECT OR MERELY A TRIVIAL OR NEGLIGIBLE EFFECT ON PRICE, QUALITY, QUANTITY OR DELIVERY OF THE ITEM. BOTH REGULATIONS DENY WAIVER OR CORRECTION WHERE TO DO SO WOULD BE PREJUDICIAL TO OTHER BIDDERS. HOWEVER, THE LATTER REGULATION IMPOSES THE FURTHER REQUIREMENT THAT CORRECTION OR WAIVER MAY NOT AFFECT THE RELATIVE STANDING OF BIDDERS. APART FROM THIS DIFFERENCE, THE ARMED SERVICES PROCUREMENT REGULATION (SEC. 2-405(IV)(B) (1969 ED.)) CONCERNING WAIVER OF MINOR INFORMALITIES THAT WAS CONSIDERED IN 52 COMP. GEN., SUPRA, WAS SUBSTANTIALLY THE SAME AS THE DISTRICT'S REGULATION. IN THE DECISION, IT WAS CONCLUDED THAT "*** WHETHER THE CHANGE AFFECTED BY THE AMENDMENT IS TRIVIAL OR NEGLIGIBLE IN TERMS OF PRICE MUST BE DETERMINED IN RELATION TO THE OVERALL SCOPE OF THE WORK AND THE DIFFERENCE BETWEEN THE LOW BIDS." APPLYING THIS STANDARD, THE ASSISTANT CORPORATION COUNSEL CONCLUDED THAT SINCE THE ESTIMATED VALUE OF ADDENDUM 2 WAS $570.00, THE OVERALL SCOPE OF THE WORK WAS APPROXIMATELY $278,000, AND THE DIFFERENCE BETWEEN THE TWO BIDS APPROXIMATELY $20,000, MARBRO'S FAILURE TO ACKNOWLEDGE THE AMENDMENTS HAD A TRIVIAL EFFECT UPON PRICE AND COULD BE WAIVED.

IN VIEW OF THE FOREGOING, THE CONTRACTING OFFICER INFORMED MARBRO ON NOVEMBER 8, 1974, THAT IT WOULD RECEIVE THE AWARD. ALSO HAVING BEEN SO INFORMED ON THAT DATE, FLIPPO PROTESTED TO THE DISTRICT THE PROPOSED AWARD. AFTER THE DENIAL OF THE PROTEST BY THE DISTRICT BY LETTER OF NOVEMBER 19, 1974, FLIPPO PROTESTED TO OUR OFFICE.

FLIPPO CONTENDS THAT THIS SITUATION IS DISTINGUISHABLE FROM THAT OF 52 COMP. GEN., SUPRA. SINCE FLIPPO WAS INDUCED BY THE GOVERNMENT TO INCUR COSTS IN CONTEMPLATION OF AWARD AS A RESULT OF THE OCTOBER 17 NOTIFICATION OF INTENT TO AWARD, THE GOVERNMENT SHOULD BE ESTOPPED FROM DENYING THE EXISTENCE OF A CONTRACT.

WE AGREE WITH THE DISTRICT'S ASSESSMENT. THE DIFFERENCE BETWEEN SECTION 2620.14-B(4)(B) AND 2642.2-2(6)(C)(2) APPEARS TO BE REFLECTIVE OF 52 COMP. GEN., SUPRA. THUS, WE BELIEVE THAT THE DISTRICT'S CONCLUSION WOULD HAVE BEEN THE SAME HAD IT BEEN PREMISED ON THE LATTER REGULATION OR ON 52 COMP. GEN., SUPRA. WE BELIEVE THAT THE $570.00 AMOUNT REQUIRED BY ADDENDUM 2 MAY REASONABLY BE CONSIDERED NEGLIGIBLE IN RELATION TO THE OVERALL COST OF THE JOB ($278,000), AS WELL AS IN THE CONTEXT OF THE $20,000 DIFFERENCE BETWEEN THE TWO BIDS. ALSO, ADDENDUM 3 DID NOT AFFECT THE PRICE, QUALITY, QUANTITY OR DELIVERY SINCE THE TRADE THAT WAS THE SUBJECT OF THE WAGE RATES WAS NOT REQUIRED TO BE USED IN THE CONTEMPLATED WORK. IT IS CLEAR THAT MARBRO'S FAILURE TO ACKNOWLEDGE THE ADDENDA IN NO WAY AFFECTED THE COMPETITIVE STANDING OF THE BIDDERS AND CONSEQUENTLY MAY PROPERLY BE WAIVED.

FLIPPO ALSO MAINTAINS THAT AS A MATTER OF PROCUREMENT POLICY THE RULE ENUNCIATED IN 52 COMP. GEN., SUPRA, SHOULD NOT BE APPLIED BROADLY SINCE IT AFFORDS A BIDDER A POST-BID OPENING ELECTION TO MODIFY ITS BID. DISAGREE. SINCE THE DETERMINATION WHETHER TO WAIVE THE INFORMALITY IS SOLELY THAT OF THE GOVERNMENT, WE FAIL TO SEE HOW A BIDDER IS AFFORDED AN OPPORTUNITY TO MODIFY ITS BID. WHILE FLIPPO IS CONCERNED WITH INDISCRIMINATE RELIANCE ON THE CITED DECISION, WE THINK IT CLEAR THAT EACH CASE HAS BEEN AND WILL BE DETERMINED ON ITS OWN FACTS.

FLIPPO CONTENDS THAT THE DISTRICT IS ESTOPPED FROM DENYING THE EXISTENCE OF A CONTRACT BECAUSE FLIPPO WAS INDUCED TO INCUR COSTS AS A RESULT OF THE GOVERNMENT'S ANNOUNCED INTENTION TO AWARD A CONTRACT TO IT. OUR OFFICE HAS CONSIDERED THE ISSUE OF ESTOPPEL IN THE MATTER OF FINK SANITARY SERVICES, INC., 53 COMP. GEN. 502 (1974). IN THAT CASE, THE OFFICIAL WHO ACTED ON BEHALF OF THE GOVERNMENT IN PURPORTING TO AWARD A CONTRACT POSSESSED THE REQUISITE AUTHORITY. IN THIS CASE, NONE OF THE OFFICIALS UPON WHOSE COMMUNICATION FLIPPO ALLEGEDLY RELIED IN INCURRING COSTS IN CONTEMPLATION OF THE CONTRACT AWARD WAS EMPOWERED TO BIND THE GOVERNMENT. IT IS CLEAR THAT THE GOVERNMENT IS NOT LIABLE FOR THE ERRONEOUS ACTS OR ADVICE OF ITS OFFICERS, AGENTS OR EMPLOYEES, EVEN IF COMMITTED IN THE PERFORMANCE OF THEIR OFFICIAL DUTIES. A BIDDER IS NOT JUSTIFIED IN ACTING UPON THE STRENGTH OF AN OFFICIAL'S APPARENT AUTHORITY SO AS TO ESTOP THE GOVERNMENT FROM AWARDING A CONTRACT TO THE LOW RESPONSIVE, RESPONSIBLE BIDDER. MATTER OF A.D. ROE COMPANY, INC., B-181692, OCTOBER 8, 1974, 54 COMP. GEN.

THE PROTEST IS DENIED.