B-123713, JUN. 22, 1955

B-123713: Jun 22, 1955

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INC.: FURTHER REFERENCE IS MADE TO YOUR LETTER OF APRIL 21. THE BID SUBMITTED BY YOU WAS IN THE AMOUNT OF $317. WHICH WAS DESIGNATED BY YOU AS . A TYPEWRITTEN NOTATION WAS PLACED ON YOUR BID. IT IS REPORTED THAT SHORTLY AFTER THE BID OPENING YOUR REPRESENTATIVE CONTACTED THE BUREAU OF SHIPS. WITH REGARD TO THE STATUS OF YOUR BID AND EXPRESSED THE OPINION THAT YOU SHOULD RECEIVE THE AWARD SINCE YOU WERE THE LOWEST BIDDER. AFTER YOU WERE ADVISED THAT IT DID NOT APPEAR THAT YOUR BID MET THE INVITATION REQUIREMENTS IN VIEW OF THE QUALIFICATIONS WITH REGARD TO PREPARATION AND DELIVERY CHARGES. 836) WAS A FIRM FIXED-PRICE BID. AWARD OF THE CONTRACT WAS MADE TO SIMMS BROTHERS. 836 QUOTED FOR PREPARATION AND DELIVERY CHARGES WAS SUBJECT TO NEGOTIATION YOU MEANT "NEGOTIATION DOWNWARD.

B-123713, JUN. 22, 1955

TO H. W. SWEET SHIPYARD AND MACHINE WORKS, INC.:

FURTHER REFERENCE IS MADE TO YOUR LETTER OF APRIL 21, 1955, PROTESTING THE AWARD OF A CONTRACT BY THE DEPARTMENT OF THE NAVY FOR THE CONSTRUCTION OF RESCUE BOATS PURSUANT TO INVITATION IFB-600-733 55'S ISSUED ON FEBRUARY 15, 1955.

THE INVITATION REQUESTED BIDS FOR THE CONSTRUCTION OF TEN RESCUE BOATS AND DELIVERY OF THE BOATS, ALL TRANSPORTATION CHARGES PAID, TO VARIOUS DESTINATIONS. THE BID SUBMITTED BY YOU WAS IN THE AMOUNT OF $317,800, PLUS A FURTHER AMOUNT OF $21,836, WHICH WAS DESIGNATED BY YOU AS ,ESTIMATED PREPARATION FOR AND DELIVERY CHARGES.' A TYPEWRITTEN NOTATION WAS PLACED ON YOUR BID, AS FOLLOWS: "PREPARATION FOR AND DELIVERY CHARGES SUBJECT TO NEGOTIATION.' ON PAGE 15 OF THE SCHEDULE OF THE BID FORM YOU ADDED THE WORDS "SUBJECT TO NEGOTIATION" TO THE CLAUSE REQUIRING DELIVERY CHARGES TO BE STATED SEPARATELY.

IT IS REPORTED THAT SHORTLY AFTER THE BID OPENING YOUR REPRESENTATIVE CONTACTED THE BUREAU OF SHIPS, DEPARTMENT OF THE NAVY, WITH REGARD TO THE STATUS OF YOUR BID AND EXPRESSED THE OPINION THAT YOU SHOULD RECEIVE THE AWARD SINCE YOU WERE THE LOWEST BIDDER. AFTER YOU WERE ADVISED THAT IT DID NOT APPEAR THAT YOUR BID MET THE INVITATION REQUIREMENTS IN VIEW OF THE QUALIFICATIONS WITH REGARD TO PREPARATION AND DELIVERY CHARGES, YOU SENT A TELEGRAM DATED MARCH 31, 1955, TO THE BUREAU OF SHIPS, IN WHICH YOU EXPLAINED THE REASON FOR THE QUALIFICATIONS AND THEN STATED YOUR BID OF $339,646 ($317,810 PLUS $21,836) WAS A FIRM FIXED-PRICE BID. ON APRIL 29, 1955, AWARD OF THE CONTRACT WAS MADE TO SIMMS BROTHERS, INCORPORATED, AS BEING THE LOWEST RESPONSIBLE BIDDER WHO HAD SUBMITTED A RESPONSIVE BID.

IN YOUR LETTER OF APRIL 21, 1955, YOU CONTEND THAT WHEN YOU STATED THAT THE AMOUNT OF $21,836 QUOTED FOR PREPARATION AND DELIVERY CHARGES WAS SUBJECT TO NEGOTIATION YOU MEANT "NEGOTIATION DOWNWARD," SINCE THE AMOUNT QUOTED REPRESENTED YOUR "MAXIMUM" COST AND YOU FELT THAT THE TENTATIVE RAILROAD QUOTATION WAS TOO HIGH AND WISHED TO PASS ANY POSSIBLE SAVINGS TO THE GOVERNMENT. ALSO, IN THE LETTER OF APRIL 21, 1955, FROM YOUR ATTORNEYS, THESE SAME ARGUMENTS ARE PRESENTED AND REFERENCE IS MADE TO SEVERAL DECISIONS OF OUR OFFICE WHICH IT IS BELIEVED SUPPORT THE PROPOSITION THAT YOUR BID SHOULD HAVE BEEN ACCEPTED.

UNDER PARAGRAPH ONE OF THE TERMS AND CONDITIONS OF THE INVITATION THE GOVERNMENT RESERVED THE RIGHT TO WAIVE ANY MINOR INFORMALITY OR IRREGULARITY IN BIDS RECEIVED. THE RIGHT TO WAIVE ANY INFORMALITY SHOULD NOT BE CONFUSED WITH, OR EXTEND TO, CASES WHERE THE QUESTION INVOLVED GOES TO THE SUBSTANCE OF A BID SO AS TO AFFECT THE PRICE, QUANTITY, OR QUALITY OF THE ARTICLES OR SUPPLIES OFFERED, AND WHERE THE WAIVING OF SUCH AN INFORMALITY MAY WORK AN INJUSTICE TO OTHER BIDDERS. 30 COMP. GEN. 179. THERE IS NO STATEMENT, EXPRESS OR IMPLIED, IN THE BID THAT NEGOTIATION IN YOUR CASE WAS TO BE DOWNWARD ONLY, OR THAT THE TOTAL PRICE STATED BY YOU WAS THE MAXIMUM TO BE PAID BY THE GOVERNMENT. AT LEAST, INFORMATION IN REGARD TO THIS MATTER WAS NOT FURNISHED BY YOU UNTIL AFTER THE OTHER BIDS RECEIVED WERE OPENED AND THE AMOUNTS OF SUCH BIDS WERE ASCERTAINED. YOUR BID AS SUBMITTED WAS NOT DEFINITE ON ITS FACE AS TO THE PRICE TO BE PAID BY THE GOVERNMENT AND, THEREFORE, WAS PROPERLY REJECTED. 19 COMP. GEN. 614. YOUR OFFER TO CONSIDER THE AMOUNT OF $21,836 AS THE MAXIMUM TO BE CHARGED FOR PREPARATION AND TRANSPORTATION CHARGES MADE SUBSEQUENT TO THE OPENING OF BIDS WOULD BE PREJUDICIAL TO THE RIGHTS OF OTHER BIDDERS.

THE FACTS IN THE DECISIONS REFERRED TO IN THE LETTER OF APRIL 21, 1955, FROM YOUR ATTORNEYS, ARE NOT SIMILAR TO THOSE INVOLVED IN YOUR CASE. TO B-101014, MARCH 15, 1951, BIDS FOR FURNISHING SUPPLIES WERE INVITED ON AN ALTERNATE BASIS, F.O.B. CARS, PHILADELPHIA, PENNSYLVANIA, OR F.O.B., CHICAGO, ILLINOIS. ALTHOUGH THERE WAS A MISTAKE AS TO TRANSPORTATION COSTS IN THE BID OF THE YALE AND TOWNE MANUFACTURING COMPANY, F.O.B. CHICAGO, ITS BID, F.O.B. PHILADELPHIA, TRANSPORTATION COSTS CONSIDERED, WAS STILL THE LOWEST BID RECEIVED. THUS, THE OFFER OF THE COMPANY, AFTER OPENING OF BIDS, TO REDUCE ITS BID, F.O.B. CHICAGO, WAS NOT PREJUDICIAL TO OTHER BIDDERS SINCE IT WAS ENTITLED TO THE AWARD ON AN F.O.B. PHILADELPHIA BASIS. WITH REGARD TO THE FACTS INVOLVED IN B-115493, JULY 2, 1953, IT APPEARS THAT THE ONLY QUESTIONABLE ITEM WAS THAT WITH REFERENCE TO THE MATTER OF FURNISHING SHORE-BASED SPARE PARTS TO CERTAIN SHIPS. THE SUCCESSFUL BIDDER WAS REQUESTED, AFTER OPENING OF BIDS, TO FURNISH DETAILS TO SUPPORT THE REQUIRED COST ESTIMATES OF SUCH SPARE PARTS. THE INVITATATION HAD SPECIFICALLY PROVIDED THAT, UPON REQUEST, ANY BIDDER SHOULD FURNISH A COPY OF ITS DETAILED BACK-UP SHEETS WHICH SHOULD SHOW DESIGN CHARGES, MATERIAL QUANTITIES, UNIT PRICES, AND LABOR COSTS FOR EACH OF THE BIDDER'S COST CLASSIFICATIONS. THE REQUEST BY THE ADMINISTRATIVE OFFICE FOR ADDITIONAL DATA IN SUPPORT OF THE BIDDER'S QUOTATION WAS IN ACCORDANCE WITH THE PROVISIONS OF THE INVITATION.

ON THE BASIS OF THE RECORD IN THIS CASE, WE WOULD NOT BE WARRANTED IN QUESTIONING THE CONTRACTING OFFICER'S ACTION IN DISREGARDING YOUR BID.