B-129980, JAN. 3, 1957

B-129980: Jan 3, 1957

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TO KURZ AND ROOT COMPANY: REFERENCE IS MADE TO YOUR LETTER OF NOVEMBER 30. IT WAS STATED: "SUPPLEMENTING OUR LETTER OF JUNE 11. THIS WILL AMEND OUR PRICES TO PROVIDE FOR PURCHASE OF QUANTITIES LESS THAN 1556. TABLE QUANTITY PRICE ADDITION 1000 TO 1555 $ 50.00 PER UNIT 700 TO 999 150.00 PER UNIT" NOTHING WAS SAID REGARDING THE PRICING OF UNITS SHOULD THE AIR FORCE ELECT TO PURCHASE LESS THAN 700 UNITS. THE AIR FORCE RECOMPUTED THEIR REQUIREMENTS FOR THE GENERATORS AND DETERMINED THAT ONLY 569 UNITS WERE NEEDED. WHICH WAS LOW. THE INVITATION WAS CANCELLED. YOU CONTEND THAT YOU ARE ENTITLED TO THE AWARD OF A CONTRACT FOR 569 UNITS AT THE PRICE WHICH APPEARS FROM YOUR LETTER OF JUNE 12 TO BE APPLICABLE TO AN AWARD OF FROM 700 TO 999 UNITS.

B-129980, JAN. 3, 1957

TO KURZ AND ROOT COMPANY:

REFERENCE IS MADE TO YOUR LETTER OF NOVEMBER 30, 1956, AND A LETTER OF DECEMBER 8, 1956, FROM YOUR ATTORNEYS, PROTESTING THE REJECTION OF YOUR BID SUBMITTED PURSUANT TO INVITATION FOR BIDS NO. 09-603-56-503 FOR 1,556 MD-1 MOTOR GENERATORS ISSUED BY THE WARNER ROBINS AIR MATERIEL AREA, DEPARTMENT OF THE AIR FORCE ON MAY 15, 1956. YOUR BID AS SUBMITTED ON JUNE 11, 1956, OFFERED TO FURNISH THE GENERATORS AT A PRICE OF $1,495 PER UNIT LESS PROMPT PAYMENT DISCOUNT. IN YOUR LETTER OF JUNE 12, WHICH BECAME PART OF YOUR BID, IT WAS STATED:

"SUPPLEMENTING OUR LETTER OF JUNE 11, 1956, CONCERNING THE ABOVE BID, THIS WILL AMEND OUR PRICES TO PROVIDE FOR PURCHASE OF QUANTITIES LESS THAN 1556.

TABLE

QUANTITY PRICE ADDITION

1000 TO 1555 $ 50.00 PER UNIT

700 TO 999 150.00 PER UNIT"

NOTHING WAS SAID REGARDING THE PRICING OF UNITS SHOULD THE AIR FORCE ELECT TO PURCHASE LESS THAN 700 UNITS. PRIOR TO OPENING, THE AIR FORCE RECOMPUTED THEIR REQUIREMENTS FOR THE GENERATORS AND DETERMINED THAT ONLY 569 UNITS WERE NEEDED. PURSUANT TO PARAGRAPH 1 OF THE TERMS AND CONDITIONS OF THE INVITATION FOR BIDS WHICH STATES IN PERTINENT PART THAT,"THE GOVERNMENT RESERVES THE RIGHT TO MAKE AN AWARD ON ANY ITEM FOR A QUANTITY LESS THAN THE QUANTITY BID UPON AT THE UNIT PRICE OFFERED UNLESS THE BIDDER SPECIFIED OTHERWISE IN HIS BID," THE AIR FORCE DETERMINED TO MAKE AN AWARD FOR ONLY 569 UNITS. SINCE YOUR BID, WHICH WAS LOW, AND THAT OF THE NEXT LOW BIDDER APPEARED TO APPLY ONLY TO QUANTITIES IN EXCESS OF THAT AMOUNT, THE INVITATION WAS CANCELLED.

YOU CONTEND THAT YOU ARE ENTITLED TO THE AWARD OF A CONTRACT FOR 569 UNITS AT THE PRICE WHICH APPEARS FROM YOUR LETTER OF JUNE 12 TO BE APPLICABLE TO AN AWARD OF FROM 700 TO 999 UNITS. THIS CONTENTION APPEARS, FROM YOUR ATTORNEY'S LETTERS, TO BE BASED ON THREE POINTS: (1) THAT THE AIR FORCE HAS A RIGHT TO MAKE AN AWARD WITHOUT READVERTISING NOTWITHSTANDING THE REJECTION; (2) THAT YOU DID NOT SPECIFY IN YOUR BID THAT YOU WOULD NOT ACCEPT AN AWARD FOR ANY QUANTITY LESS THAN 700 UNITS AT THE BID PRICE APPLICABLE TO AN AWARD FOR 700 TO 999 UNITS, AND THEREFORE, PURSUANT TO THE PROVISIONS OF PARAGRAPH 1 OF THE TERMS AND CONDITIONS QUOTED ABOVE, THE AIR FORCE HAD A RIGHT TO MAKE A BINDING AWARD FOR AN AMOUNT LESS THAN 700 AT THE 700 TO 999 PRICE PER UNIT; (3) AND THAT, EVEN IF IT BE CONCEDED THAT THE MEANING OF THE JUNE 12 LETTER WAS AMBIGUOUS, THE AWARD SHOULD NEVERTHELESS BE MADE TO YOU SINCE WHERE A BID IS CONSIDERED AMBIGUOUS A CONTRACT SHOULD BE AWARDED ON THE BASIS CONSIDERED MOST FAVORABLE TO THE GOVERNMENT.

IN SUPPORT OF THE FIRST CONTENTION--- THAT THE AIR FORCE MAY MAKE AN AWARD WITHOUT READVERTISING NOTWITHSTANDING THE REJECTION--- YOU CITE OUR DECISIONS PUBLISHED AT 35 COMP. GEN. 255, 34 COMP. GEN. 535 AND 19 COMP. GEN. 356. THE LATEST OF THOSE DECISIONS, WHICH WE BELIEVE TO BE CORRECT, IS CONTRARY TO THE POSITION TAKEN BY YOUR ATTORNEY, AND THE OTHER TWO, ARE DISTINGUISHABLE ON THE FACTS FROM THE SITUATION HERE PRESENTED. IN ANY EVENT THE QUESTION INVOLVED IN THOSE DECISIONS IS NOT HERE PRESENTED; RATHER, THE PROPOSITION TO BE RESOLVED IS WHETHER A BID WHICH ON ITS FACE IS LIMITED TO A STATED MINIMUM QUANTITY MAY BE ACCEPTED FOR A LESSER QUANTITY.

ON THAT QUESTION WE ARE UNABLE TO AGREE WITH YOUR SECOND CONTENTION- - THAT, SINCE THE BID DID NOT SPECIFICALLY STATE THAT YOU WOULD NOT ACCEPT AN AWARD FOR A QUANTITY LESS THAN 700, AN AWARD FOR A LESSER QUANTITY MAY BE MADE PURSUANT TO PARAGRAPH 1 OF THE TERMS AND CONDITIONS. PARTICULAR FORM IS ESTABLISHED WHEREBY THE BIDDER MAY "SPECIFY OTHERWISE," AS CONTEMPLATED BY THAT PARAGRAPH; BUT ANY STATEMENT WHICH MAY PROPERLY BE REGARDED AS PART OF THE BID IN WHICH THE BIDDER INDICATES A CLEAR INTENTION TO LIMIT HIS BID TO A SPECIFIED MINIMUM QUANTITY WILL SERVE TO SATISFY THE REQUIREMENTS OF PARAGRAPH 1. YOUR CLEAR STATEMENT OF A UNIT PRICE APPLICABLE TO ANY QUANTITY BETWEEN 700 AND 999 CANNOT BE CONSTRUED OTHERWISE THAN AS A LIMITATION OF THE GOVERNMENT'S RIGHT OF ACCEPTANCE TO A QUANTITY NOT LESS THAN 700.

AS TO THE THIRD CONTENTION THAT AMBIGUITIES IN THE BID ARE TO BE INTERPRETED SO AS TO RENDER A RESULT MOST FAVORABLE TO THE GOVERNMENT, YOU CITE OUR DECISION, 16 COMP. GEN. 569. TO APPLY THE PRINCIPLE THERE STATED IT MUST FIRST BE DETERMINED WHETHER OR NOT THE BID IS REASONABLY SUSCEPTIBLE TO MORE THAN ONE INTERPRETATION--- WHETHER THERE IS IN FACT ANY AMBIGUITY. LOOKING AT YOUR BID AS A WHOLE WE ARE UNABLE TO JUSTIFY ANY REASONABLE INTERPRETATION OTHER THAN THAT STATED IN THE PREVIOUS PARAGRAPH. IF WE ACCEPT YOUR CONTENTION THAT YOUR BID, AS MODIFIED BY THE SUPPLEMENTARY LETTER OF JUNE 12 DID NOT PRECLUDE AN AWARD FOR SMALLER QUANTITIES THAN 700, WE THINK IT WOULD BE NO LESS LOGICAL TO CONCLUDE THAT THE UNIT PRICE APPLICABLE TO SUCH SMALLER QUANTITIES WOULD BE THAT QUOTED IN THE ORIGINAL BID FOR 1,455 UNITS, RATHER THAN THAT QUOTED FOR 700.

SINCE THE AIR FORCE HAD DETERMINED TO MAKE AN AWARD FOR ONLY 569 UNITS, WE ARE OF THE OPINION, FOR THE REASONS STATED, THAT IT PROPERLY REJECTED YOUR BID AS PRECLUDING AWARDS FOR ANY AMOUNT LESS THAN 700 UNITS. ACCORDINGLY, YOUR PROTEST MUST BE DENIED.