B-107275, AUG 4, 1952

B-107275: Aug 4, 1952

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INC.: REFERENCE IS MADE TO YOUR LETTER DATED JANUARY 3. PROSPECTIVE BIDDERS WERE ADVISED THAT THE RIGHT WAS RESERVED. EIGHT BIDS WERE RECEIVED IN RESPONSE TO THE INVITATION. THE BID OF THE HOBBS MANUFACTURING COMPANY WAS MADE F.O.B. THE BID OF THE HOBBS MANUFACTURING COMPANY WAS ACCEPTED ON BEHALF OF THE GOVERNMENT ON DECEMBER 7. THE PRIMARY QUESTION FOR DETERMINATION IN THIS AND SIMILAR CASES IS WHETHER THE DEVIATION PROPOSED TO BE WAIVED GOES TO THE SUBSTANCE OF THE BID AS TO AFFECT EITHER THE PRICE. OR QUALITY OF THE ARTICLES OFFERED AND THEREFORE IS PREJUDICIAL TO THE RIGHTS OF OTHER BIDDERS OR IS MERELY A MATTER OF FORM OR SOME IMMATERIAL VARIATION FROM THE EXACT REQUIREMENTS OF THE SPECIFICATIONS SUCH AS WOULD NOT AFFECT THE PRICE.

B-107275, AUG 4, 1952

PRECIS-UNAVAILABLE

MANHATTAN LIGHTING EQUIPMENT CO., INC.:

REFERENCE IS MADE TO YOUR LETTER DATED JANUARY 3, 1952, WHEREIN YOU PROTEST THE AWARD OF CONTRACT NO. AF-33(600)-6784 TO THE HOBBS MANUFACTURING COMPANY, WORCESTER, MASSACHUSETTS, BY THE WRIGHT- PATTERSON AIR FORCE BASE, DAYTON, OHIO.

BY INVITATION NO. IFB 33-600-52-214, THE SAID BASE REQUESTED BIDS FOR CERTAIN CUTTER PINS, ITEM 1 THROUGH ITEM 41, F.O.B. POINT OF ORIGIN. PARAGRAPH 1 OF THE TERMS AND CONDITIONS OF THE INVITATION FOR BIDS, PROSPECTIVE BIDDERS WERE ADVISED THAT THE RIGHT WAS RESERVED, AS THE INTERESTS OF THE GOVERNMENT MIGHT REQUIRE, TO REJECT ANY OR ALL BIDS AND TO WAIVE ANY MINOR INFORMALITY OR IRREGULARITY IN BIDS RECEIVED AND THAT THE CONTRACT WOULD BE AWARDED TO THAT RESPONSIBLE BIDDER WHOSE BID, CONFORMING TO THE INVITATION FOR BIDS, WOULD BE COST ADVANTAGEOUS TO THE GOVERNMENT, PRICE AND OTHER FACTORS CONSIDERED.

EIGHT BIDS WERE RECEIVED IN RESPONSE TO THE INVITATION. THE ADMINISTRATIVE OFFICE REPORTS THAT FOR ALL INTENTS AND PURPOSES EVALUATION OF THE SUBJECT INVITATION ON THE BASIS OF PRICE ONLY, INDICATED A THREE- WAY TIE FOR LOW BID ON ITEMS 4 THROUGH 41 INCLUSIVE. THE RECORD SHOWS THAT YOU SUBMITTED A BID OF $152,350, AND LIEB HARDWARE CORPORATION AND HOBBS MANUFACTURING COMPANY SUBMITTED EQUAL BIDS OF $152,417.47. HOWEVER, THE BID OF THE HOBBS MANUFACTURING COMPANY WAS MADE F.O.B. DESTINATION, ALTHOUGH THE INVITATION SPECIFIED B.O.B. POINT OF ORIGIN. THE BID OF THE HOBBS MANUFACTURING COMPANY WAS ACCEPTED ON BEHALF OF THE GOVERNMENT ON DECEMBER 7, 1951, AS IT "RESULTED IN ULTIMATE SAVINGS TO THE GOVERNMENT."

YOU PROTESTED THE AWARD OF THE CONTRACT ON THE GROUNDS THAT "IT DID NOT CO-INCIDE WITH THE TERMS AND CONDITIONS ON THE INVITATION TO BID."

AS STATED IN DECISION OF NOVEMBER 8, 1950, 30 COMP. GEN. 179, TO THE SECRETARY OF THE AIR FORCE, THE PRIMARY QUESTION FOR DETERMINATION IN THIS AND SIMILAR CASES IS WHETHER THE DEVIATION PROPOSED TO BE WAIVED GOES TO THE SUBSTANCE OF THE BID AS TO AFFECT EITHER THE PRICE, QUANTITY, OR QUALITY OF THE ARTICLES OFFERED AND THEREFORE IS PREJUDICIAL TO THE RIGHTS OF OTHER BIDDERS OR IS MERELY A MATTER OF FORM OR SOME IMMATERIAL VARIATION FROM THE EXACT REQUIREMENTS OF THE SPECIFICATIONS SUCH AS WOULD NOT AFFECT THE PRICE, QUALITY, OR QUANTITY OF THE ARTICLE OFFERED.

THE ADVERTISED SPECIFICATIONS ADVISED PROSPECTIVE BIDDERS AS TO THE NEEDS OF THE AIR FORCE WITH RESPECT TO THE COTTER PINS REQUIRED. IT WAS PROVIDED AMONG OTHER THINGS THAT DELIVERY WAS TO BE F.O.B. POINT OF ORIGIN, IT BEING THE INTENTION TO AWARD THE BID TO THE BIDDER OFFERING THE MOST FAVORABLE PRICE, TAKING INTO CONSIDERATION THE COST TO THE GOVERNMENT OF TRANSPORTING THE PINS TO DESTINATIONS. NOTWITHSTANDING THIS PROVISION OF THE ADVERTISEMENT FOR BIDS, ONE OF THE BIDDERS - THE HOBBS MANUFACTURING COMPANY - BID F.O.B. DESTINATIONS. WHILE THE COST TO THE GOVERNMENT IS ALWAYS A MATTER FOR CONSIDERATION IN DETERMINING WHICH, IN FACT, IS THE LOWEST BID RECEIVED, 10 COMP. GEN. 402, THE ADVERTISED SPECIFICATIONS IN THIS CASE SPECIFICALLY ADVISED ALL PROSPECTIVE BIDDERS THAT BIDS WOULD BE RECEIVED ON THE BASIS OF DELIVERY F.O.B. POINT OF ORIGIN. GENERALLY IT HAS BEEN HELD THAT THE AWARD OF A CONTRACT ON THE BASIS OF DELIVERY F.O.B. DESTINATION UNDER SUCH CIRCUMSTANCES IS NOT COMPETITION ON AN EQUAL BASIS AND IS PREJUDICIAL TO THE RIGHTS OF OTHER BIDDERS. 16 COMP. GEN. 21; ID. 149.

IN THIS PARTICULAR CASE, HOWEVER, ALL BIDDERS WERE ADVISED OF THE ULTIMATE DESTINATION OF THE MATERIAL. THEY WERE GIVEN THE RIGHT BY THE INVITATION TO DESIGNATE AS THE F.O.B. POINT THE CONTRACTOR'S PLANT "OR SUCH OTHER POINT OF ORIGIN AS CONTRACTOR SHALL DESIGNATE." THE BASIS OF EVALUATION WAS THE COST OF DELIVERY TO DESTINATION, SO THAT COMPETITION MIGHT BE ON AN EQUAL BASIS REGARDLESS OF WHERE THE MATERIAL WAS OFFERED. MOREOVER, IT CANNOT BE ASSUMED THAT TRANSPORTATION RATES AVAILABLE TO THE GOVERNMENT FOR SHIPPING IN QUANTITY LOTS OF THE SIZE HERE INVOLVED WERE LESS FAVORABLE THAN THOSE AVAILABLE TO THE BIDDERS; AND THERE IS NO APPARENT REASON FOR BELIEVING THAT THE COST OF DELIVERY TO DESTINATION WOULD BE INCREASED TO THE COMPETITIVE DISADVANTAGE OF A BIDDER BY REASON OF THE FACT THAT THE GOVERNMENT RATHER THAN THE BIDDER PAID SUCH COSTS. ACCORDINGLY, WHILE THE DEVIATION FROM ADVERTISED SPECIFICATIONS AFFECTED THE PRICE, IT DID NOT AFFECT THE BASIS FOR EVALUATION OF BIDS AND IS NOT REGARDED AS BEING NECESSARILY PREJUDICIAL TO THE RIGHTS OF OTHER BIDDERS.

IN VIEW OF THE FOREGOING AND SINCE THE AWARD WAS MADE ON DECEMBER 7, 1951, WITH DELIVERY TO BEGIN WITHIN 60 DAYS AND TO BE COMPLETED WITHIN 180 DAYS AFTER AWARD, NO FURTHER QUESTION WILL BE RAISED TO THE ADMINISTRATIVE ACTION TAKEN IN THIS CASE.