B-131860, MAY 20, 1957

B-131860: May 20, 1957

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DEPARTMENT OF THE NAVY: REFERENCE IS MADE TO YOUR LETTER OF MAY 16. THE PROVISION INVOLVED IN SECTION 5.1 WHICH PROVIDES: "PRIOR TO AWARD/S) THE SUCCESSFUL BIDDER/S) WILL BE REQUIRED TO FURNISH PLANS. SEPARATE APPROVAL OF THE PLASTIC FLOATATION BLOCKS WILL BE REQUIRED. THE ABOVE PROVISION HAS BEEN CONTESTED BY ONE OF THE BIDDERS ON THE BASIS THAT IT IS VAGUE. THE PROTEST CONCLUDES THAT THE PROVISION IS ILLEGAL AND THAT AN AWARD UNDER THE INVITATION WOULD ALSO BE ILLEGAL. IT IS STATED IN YOUR LETTER THAT THE DANGER COMPLAINED OF IS RECOGNIZED. IS IS CONSIDERED PREFERABLE TO THE ALTERNATIVE OF REQUIRING EACH BIDDER TO SUBMIT PRELIMINARY APPROVED PLANS WITH ITS BID. IT IS FURTHER STATED THAT REQUIRING APPROVAL BEFORE AWARD GREATLY FACILITATES THE BUREAU'S TASK OF DETERMINING WHETHER THE LOW BIDDER IS TECHNICALLY RESPONSIBLE AND THAT.

B-131860, MAY 20, 1957

TO MR. C. W. BROCKMAN, CONTRACTING OFFICER, BUREAU OF SHIPS, DEPARTMENT OF THE NAVY:

REFERENCE IS MADE TO YOUR LETTER OF MAY 16, 1957, REQUESTING A DECISION AS TO THE LEGALITY OF A PROVISION INCLUDED IN A CURRENT INVITATION FOR BIDS, IFB-600-1442-57-S, FOR THE PROCUREMENT OF LIFEBOATS.

THE PROVISION INVOLVED IN SECTION 5.1 WHICH PROVIDES:

"PRIOR TO AWARD/S) THE SUCCESSFUL BIDDER/S) WILL BE REQUIRED TO FURNISH PLANS, INCLUDING THE BILL OF MATERIAL THEREON, WITH PROOF OF REVIEW AND PRELIMINARY ACCEPTANCE BY THE U.S. COAST GUARD. SEPARATE APPROVAL OF THE PLASTIC FLOATATION BLOCKS WILL BE REQUIRED. INFORMATION ON SUCH APPROVAL OR LISTING APPROVED SUPPLIERS MAY BE OBTAINED FROM THE COMMANDER U.S. COAST GUARD NT).'

THE ABOVE PROVISION HAS BEEN CONTESTED BY ONE OF THE BIDDERS ON THE BASIS THAT IT IS VAGUE, AMBIGUOUS AND DISCRIMINATORY AND PLACES CONTROL IN THE HANDS OF A BIDDER, AFTER THE OPENING OF THE BIDS, TO DETERMINE A COURSE OF CONDUCT WHICH MAY BE PREJUDICIAL TO THE WELFARE AND INTEREST OF THE GOVERNMENT AND UNFAIR TO OTHER BIDDERS. THE PROTEST CONCLUDES THAT THE PROVISION IS ILLEGAL AND THAT AN AWARD UNDER THE INVITATION WOULD ALSO BE ILLEGAL, THE REASON ADVANCED BEING THAT A LOW BIDDER COULD EFFECTIVELY WITHDRAW HIS BID, AFTER THE OPENING OF THE BIDS, BY DELIBERATELY FAILING TO SUBMIT PRELIMINARY APPROVED PLANS.

IT IS STATED IN YOUR LETTER THAT THE DANGER COMPLAINED OF IS RECOGNIZED, BUT IS IS CONSIDERED PREFERABLE TO THE ALTERNATIVE OF REQUIRING EACH BIDDER TO SUBMIT PRELIMINARY APPROVED PLANS WITH ITS BID, SINCE IT WOULD IMPOSE AN UNDESIRABLE BURDEN AND EXPENSE ON THE UNSUCCESSFUL BIDDERS AND TAX THE FACILITIES OF THE COAST GUARD. THE OTHER ALTERNATIVE OF POSTPONING THE REQUIREMENT OF PRELIMINARY REVIEW AND APPROVAL BY THE COAST GUARD UNTIL AFTER AWARD WOULD INCREASE THE RISK OF MAKING AWARD TO AN UNQUALIFIED BIDDER. IT IS FURTHER STATED THAT REQUIRING APPROVAL BEFORE AWARD GREATLY FACILITATES THE BUREAU'S TASK OF DETERMINING WHETHER THE LOW BIDDER IS TECHNICALLY RESPONSIBLE AND THAT, SINCE THE COAST GUARD APPROVAL OF THE FINAL PRODUCTS IS REQUIRED UNDER THE SPECIFICATIONS, THE REQUIREMENT OF OBTAINING PRELIMINARY APPROVAL OF PLANS BY THE COAST GUARD IS BELIEVED TO BE A REASONABLE PREREQUISITE TO THE MAKING OF AN AWARD.

IT LONG HAS BEEN HELD THAT THE BID MOST ADVANTAGEOUS TO THE GOVERNMENT, MEANING THE BID OF THE LOWEST RESPONSIBLE BIDDER, IS THE ONE THAT SHOULD BE ACCEPTED. IN OTHER WORDS, IT OBVIOUSLY IS IN THE INTEREST OF THE GOVERNMENT TO AWARD A CONTRACT TO A BIDDER WHO IS ABLE TO PERFORM IT. THE TERM "RESPONSIBLE" MEANS SOMETHING MORE THAN PECUNIARY INTEGRITY. SEE O- BRIEN V. CARNEY, 6 F.SUPP. 761. IN UNUSUAL CASES, IN ORDER TO INSURE SUCH RESPONSIBILITY, SPECIAL PROVISIONS OR QUALIFICATIONS MAY BE INSERTED IN INVITATIONS BY REASON OF THE COMPLEXITY OF THE EQUIPMENT BEING PURCHASED OR FOR SOME OTHER SPECIAL REASON.

WHILE SAMPLES, DESCRIPTIVE LITERATURE, PLANS AND DRAWINGS, GENERALLY, ARE REQUIRED TO BE SUBMITTED AS A PART OF A BID IN ORDER FOR THE BID TO CONSTITUTE A DEFINITE AND FIRM OFFER, THERE MAY BE INSTANCES, PARTICULARLY WITH RESPECT TO PLANS AND DRAWINGS, WHERE SUCH A PROCEDURE IS NOT FEASIBLE. CONCEIVABLY SUCH A PROVISION AS HERE INVOLVED MIGHT BE PREJUDICIAL TO THE GOVERNMENT AND MAY, UNDER CERTAIN CIRCUMSTANCES, NOT BE CONSIDERED A SOUND PROCUREMENT PROCEDURE. HOWEVER, THERE CAN BE NO DOUBT THAT THE PROVISION IS NOT PREJUDICIAL TO BIDDERS AS THEY ALL HAVE BEEN AFFORDED THE SAME OPPORTUNITY AS THE LOW BIDDER IN THIS INSTANCE. WHILE IT IS NOT MATERIAL TO THE ISSUE INVOLVED, IT IS INTERESTING TO NOTE THAT THE PROTESTANT DID NOT OBJECT TO THE PROVISION UNTIL AFTER THE OPENING OF THE BIDS, AND IT IS ALSO UNDERSTOOD THAT THE PROTESTANT HAS BEEN AWARDED CONTRACTS UNDER INVITATIONS WITH THE SAME PROVISION WITHOUT OBJECTION THERETO.

ALTHOUGH WE WOULD BE OPPOSED TO THE GENERAL APPLICATION OF ANY PROCEDURE THAT MIGHT RESULT IN OTHER THAN A FIRM AND BINDING OFFER BEING RECEIVED AT THE TIME OF THE BID OPENING, WE PERCEIVE NO BASIS FOR HOLDING THAT AN AWARD OF A CONTRACT UNDER THE INVITATION HERE INVOLVED WOULD BE ILLEGAL. ACCORDINGLY, YOU ARE ADVISED THAT WE WILL NOT QUESTION AN AWARD UNDER THE INSTANT INVITATION.