A-68843, DECEMBER 23, 1935, 15 COMP. GEN. 553

A-68843: Dec 23, 1935

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WHERE THE LOW BID IS SO QUALIFIED THAT IT IS NOT RESPONSIVE TO THE TERMS OF THE INVITATION FOR BIDS. WERE OPENED ON DECEMBER 9. THREE BIDS WERE RECEIVED. THE LOW BIDDER WAS R. WHOSE BID WAS IN THE SUM OF $33. THE BID OF THE ASPLUND CONSTRUCTION COMPANY IS IN GOOD FORM AND ACCOMPANIED BY A SATISFACTORY BID BOND. W. MCMILLEN WAS ACCOMPANIED BY A CERTIFIED CHECK IN THE AMOUNT SPECIFIED. IS IN GOOD FORM. W. MCMILLEN WAS QUALIFIED BY A LETTER ATTACHED TO THE BID WHICH READS AS FOLLOWS: "WE ARE HEREBY MODIFYING THIS PROPOSAL IN THAT WE WILL REQUIRE THAT AN ACCEPTANCE BE MADE WITHIN FIFTEEN DAYS (15) FROM RECEIPT OF BIDS. UNLESS AN EXTENSION OF TIME IS GRANTED BY US. "WE AGREE TO COMPLETE THE CONTRACT WITHIN THE SPECIFIED TIME (90 DAYS) PROVIDED THAT WE ARE ALLOWED ADDITIONAL TIME FOR INCLIMATE WEATHER.

A-68843, DECEMBER 23, 1935, 15 COMP. GEN. 553

ADVERTISING - BIDDER'S MODIFICATION OF TERMS OF INVITATION FOR BIDS THE LOW BID SUBMITTED IN CONNECTION WITH ADVERTISED SPECIFICATIONS SHOULD BE REJECTED AND AWARD MADE TO THE NEXT LOWEST BIDDER, IF OTHERWISE PROPER, WHERE THE LOW BID IS SO QUALIFIED THAT IT IS NOT RESPONSIVE TO THE TERMS OF THE INVITATION FOR BIDS.

COMPTROLLER GENERAL MCCARL TO THE ADMINISTRATOR, FEDERAL EMERGENCY ADMINISTRATION OF PUBLIC WORKS, DECEMBER 23, 1935:

THERE HAS BEEN RECEIVED YOUR LETTER OF DECEMBER 12, 1935, AS FOLLOWS:

BIDS FOR THE CONSTRUCTION OF FOUNDATIONS FOR THE LOW-COST HOUSING PROJECT IN ENID, OKLAHOMA, PROJECT NO. H-5401, WERE OPENED ON DECEMBER 9. THREE BIDS WERE RECEIVED. THE LOW BIDDER WAS R. W. MCMILLEN, AN INDIVIDUAL TRADING AS THE MCMILLEN CONSTRUCTION COMPANY, WHOSE BID WAS IN THE SUM OF $33,600. THE SECOND BIDDER, ASPLUND CONSTRUCTION COMPANY, SUBMITTED A BID IN THE AMOUNT OF $36,478, THE ORIGINAL BID OF THIS COMPANY HAVING BEEN MODIFIED BY A TELEGRAM RECEIVED PRIOR TO THE OPENING OF BIDS. THE BID OF THE ASPLUND CONSTRUCTION COMPANY IS IN GOOD FORM AND ACCOMPANIED BY A SATISFACTORY BID BOND.

THE BID OF R. W. MCMILLEN WAS ACCOMPANIED BY A CERTIFIED CHECK IN THE AMOUNT SPECIFIED, IN LIEU OF A BID BOND, AND, EXCEPT AS NOTED, IS IN GOOD FORM. THE BID OF R. W. MCMILLEN WAS QUALIFIED BY A LETTER ATTACHED TO THE BID WHICH READS AS FOLLOWS:

"WE ARE HEREBY MODIFYING THIS PROPOSAL IN THAT WE WILL REQUIRE THAT AN ACCEPTANCE BE MADE WITHIN FIFTEEN DAYS (15) FROM RECEIPT OF BIDS, ALSO THAT A WORK ORDER MUST BE ISSUED WITHIN FIFTEEN (15) DAYS AFTER ACCEPTANCE, UNLESS AN EXTENSION OF TIME IS GRANTED BY US.

"WE AGREE TO COMPLETE THE CONTRACT WITHIN THE SPECIFIED TIME (90 DAYS) PROVIDED THAT WE ARE ALLOWED ADDITIONAL TIME FOR INCLIMATE WEATHER; OTHERWISE WE WILL REQUIRE ONE HUNDRED AND TWENTY DAYS (120), CALENDAR.'

THE SPECIFICATIONS AS ISSUED PROVIDE:

"IF WRITTEN NOTICE OF ACCEPTANCE OF THIS BID IS RECEIVED BY THE CONTRACTOR WITHIN SIXTY (60) DAYS AFTER THE DATE OF OPENING OF THE BIDS, THE CONTRACTOR SHALL, WITHIN SEVEN (7) DAYS THEREAFTER, EXECUTE THE CONTRACT WITH THE UNITED STATES OF AMERICA IN THE FORM OF UNITED STATES GOVERNMENT FORM OF CONTRACT, FORM NO. P.W.A. 51, IN ACCORDANCE WITH THE INSTRUCTIONS TO BIDDERS.'

THE SPECIFICATIONS FURTHER PROVIDE:

"THE WORK SHALL BE COMMENCED UPON RECEIPT BY THE CONTRACTOR OF NOTICE TO PROCEED AND SHALL BE COMPLETED WITHIN NINETY (90) DAYS FROM THE DATE OF RECEIPT BY THE CONTRACTOR OF SUCH NOTICE.' (SEE SECTION 10, INSTRUCTIONS TO BIDDERS.)

SECTION 10 FURTHER PROVIDES:

"SUCH NOTICE MAY BE GIVEN TO THE BIDDER BY THE GOVERNMENT ON ANY DATE AFTER THE BIDDER HAS EXECUTED THE CONTRACT AND FURNISHED HIS PERFORMANCE BOND * * *.'

THERE IS THE FURTHER PROVISION IN THIS SECTION FOR LIQUIDATED DAMAGES IN THE SUM OF $100 PER DAY FOR DELAYS NOT EXCUSABLE.

ARTICLE 9 OF THE STANDARD FORM OF CONTRACT PROVIDES FOR THE DELAYS WHICH WILL RELIEVE THE CONTRACTOR FROM BEING CHARGED WITH LIQUIDATED DAMAGES. ONE OF THESE REASONS IS "UNUSUALLY SEVERE WEATHER OR DELAYS OF SUBCONTRACTORS DUE TO SUCH CAUSES.'

IT WILL BE SEEN, THEREFORE, THAT THE LETTER ABOVE QUOTED FROM R. W. MCMILLEN MODIFIES THE SPECIFICATIONS IN THREE PARTICULARS:

1. IT SHORTENS THE TIME IN WHICH THE GOVERNMENT MUST ACCEPT THE BID.

2. IT SHORTENS THE TIME WITHIN WHICH THE PROCEED ORDER MUST BE GIVEN.

3. IT PROVIDES FOR DELAYS WHICH MAY OR MAY NOT BE CONTEMPLATED UNDER THE CONTRACT, DEPENDING UPON WHETHER THE WORD "INCLIMATE," AS USED IN THE LETTER, IS SYNONYMOUS WITH THE WORDS "UNUSUALLY SEVERE" AS SET FORTH IN ARTICLE 9 OF THE FORM OF CONTRACT. IN VIEW OF THE RULING IN 11 OP.C.G. 442, IN WHICH YOU HAVE DEFINED WHAT IS MEANT BY "UNUSUALLY SEVERE" WEATHER, THERE IS SOME QUESTION IN MY MIND AS TO WHETHER OR NOT "UNUSUALLY SEVERE" AND "INCLIMATE" WEATHER HAVE THE SAME MEANING.

IN REGARD TO THE FIRST TWO VARIATIONS, THE FIFTEEN DAYS SPECIFIED AS THE TIME WITHIN WHICH THE BID MUST BE ACCEPTED PRESENTS NO UNUSUAL DIFFICULTIES AND, EXCEPT FOR THE MODIFICATION CONTAINED IN THE BID, THE SAME WOULD HAVE BEEN ACCEPTED WITHIN A MUCH SHORTER PERIOD. WHILE WE FEEL CONFIDENT THAT A PROCEED ORDER COULD ALSO BE ISSUED WITHIN FIFTEEN DAYS AFTER THE ACCEPTANCE OF THE BID, AS THE STRUCTURES LOCATED ON THE PREMISES ARE NOW BEING RAZED BY OTHERS THAN THE PRESENT CONTRACTOR, SOME QUESTION MIGHT ARISE IN THE EVENT THE WORK WAS NOT COMPLETED WITHIN THE TIME LIMIT SET BY MR. MCMILLEN. PRESENT INDICATIONS ARE THAT THIS DEMOLITION WORK WILL BE COMPLETED WITHIN THE NEXT TEN DAYS, BUT THERE MAY BE CIRCUMSTANCES OVER WHICH WE HAVE NO CONTROL WHICH MAY DELAY THIS WORK.

YOUR ATTENTION IS DIRECTED TO YOUR PREVIOUS RULING CONTAINED IN 13 OP.C.G. 169, IN WHICH YOU STATED:

"AS THE BID ATTEMPTS TO INCORPORATE THEREIN TERMS AND CONDITIONS NOT OFFERED BY THE GOVERNMENT TO ALL BIDDERS AS A BASIS OF COMPETITION, CONSEQUENTLY SUCH BID MAY NOT BE ACCEPTED.'

I ALSO CALL YOUR ATTENTION TO YOUR OPINION IN 9 OP.C.G. 24, IN WHICH THE PROPOSAL OF THE SECOND BIDDER WAS ACCEPTED WITH YOUR APPROVAL WHEN THE LOW BIDDER SUBMITTED A PROPOSAL NOT IN ACCORDANCE WITH THE SPECIFICATIONS.

IN VIEW OF THESE RULINGS, I REQUEST YOUR OPINION AS TO WHETHER OR NOT THE GOVERNMENT SHOULD REJECT THE BID OF R. W. MCMILLEN AND IN THE EVENT OF SUCH REJECTION, MAY THE GOVERNMENT AWARD THE CONTRACT TO THE ASPLUND CONSTRUCTION COMPANY AT THE ADVANCE OF $2,878, WHICH WILL BE OCCASIONED BY THE AWARD?

I AM ENCLOSING FOR YOUR INFORMATION THE TABULATION OF ALL BIDS AND THE BIDS OF R. W. MCMILLEN AND THE ASPLUND CONSTRUCTION COMPANY, TOGETHER WITH A COPY OF THE SPECIFICATIONS UPON WHICH THE BIDS WERE BASED.

CONTRACTING OFFICERS ARE NOT REQUIRED OR AUTHORIZED TO REJECT THE LOW BID BECAUSE OF IMMATERIAL QUALIFICATIONS WHICH DO NOT PREJUDICE THE RIGHTS OF THE UNITED STATES OR CHANGE THE BASIS FROM THAT UPON WHICH OTHER BIDS HAVE BEEN SUBMITTED, BUT WHERE THE MODIFICATIONS ARE SUCH THAT FURTHER ORDERLY PROCEDURE IS UNCERTAIN OR IMPOSSIBLE, THE LOW BID SHOULD BE REJECTED. THIS CASE THE LOW BIDDER PLACED A LIMIT ON THE TIME FOR ACCEPTANCE OF THE BID AND ISSUING THE ORDER TO PROCEED AND MADE THE TIME FOR COMPLETION OF THE WORK CONDITIONAL.

IT APPEARS THAT THE 15 DAYS ALLOWED FOR ACCEPTING THE BID IS AMPLE TIME FOR THAT PURPOSE AND SUCH QUALIFICATION OF THE PROPOSAL IS NOT MATERIAL AND STANDING ALONE WOULD NOT REQUIRE REJECTION OF THE BID. THE SECOND QUALIFICATION, ALLOWING ONLY 15 DAYS AFTER ACCEPTANCE OF BID TO ISSUE PROCEED ORDER PRESENTS A MORE SERIOUS QUESTION. FORMAL CONTRACT AND PERFORMANCE BONDS MUST BE EXECUTED BEFORE THE ORDER TO PROCEED MAY BE ISSUED. IT MAY BE FOUND IMPRACTICABLE, OR EVEN IMPOSSIBLE TO ISSUE THE ORDER TO PROCEED WITHIN THE TIME FIXED BY THE BIDDER AND THE UNITED STATES WOULD BE FORCED TO READVERTISE THE WORK WITH THE CONSEQUENT DELAY AND EXPENSE INCIDENT THERETO WITH POSSIBLE CONTROVERSY WITH THE LOW BIDDER IN THE FIRST INSTANCE WHOSE BID HAD BEEN ACCEPTED. THE THIRD MODIFICATION IS OBJECTIONABLE FOR SIMILAR REASONS AND FOR THE FURTHER REASON THAT IT IS NOT CLEAR WHAT IS MEANT BY "INCLIMATE WEATHER.' THE STANDARD GOVERNMENT FORM OF CONSTRUCTION CONTRACT MAY NOT BE SO MODIFIED BY THE BIDDER.

THE PROPOSAL OF THE MCMILLEN CONSTRUCTION CO. SHOULD BE REJECTED BECAUSE IT IS NOT RESPONSIVE TO THE INVITATION FOR BIDS, AND THE CONTRACT MAY BE AWARDED TO THE NEXT LOWEST BIDDER IN THE ABSENCE OF OTHER OBJECTION.