B-132532, AUGUST 13, 1957, 37 COMP. GEN. 110

B-132532: Aug 13, 1957

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WHICH ARE CONTRARY TO THE STANDARD GOVERNMENT CONTRACT FORM. 1957: FURTHER REFERENCE IS MADE TO YOUR TELEGRAM OF JULY 15. YOU ALSO STATED THAT ALTHOUGH YOUR BID WAS $7. 000 LOWER IT WAS REJECTED DUE TO A MINOR TECHNICALITY. THE PROCURING AGENCY HAS REPORTED THAT A MISTAKE IN BID WAS ALLEGED BY YOUR FIRM WITH RESPECT TO WHICH THE ASSISTANT CHIEF FOR PURCHASING. THE CONTRACTING OFFICER REPORTS THAT BIDS WERE OPENED 7 JUNE 1957. THE INVITATION PROVIDES THAT THE DESIRED DELIVERY DATE IS FEBRUARY 1958. THE MAXIMUM ACCEPTABLE DELIVERY DATE IS JUNE 1958. 401.40 WAS MADE BY AJAX ELECTROTHERMIC CORPORATION. 433.50 WERE RECEIVED. 2. QUOTATION 52857-H (IN LETTER-FORM DATED 3 JUNE 1957) WHICH WAS ATTACHED TO THE BID CONTAINED THE FOLLOWING STATEMENTS: "WE ESTIMATE SHIPMENT OF THIS MATERIAL CAN BE MADE IN ACCORDANCE WITH SPECIFICATIONS BY FEBRUARY 1958.

B-132532, AUGUST 13, 1957, 37 COMP. GEN. 110

BIDS - ACCEPTANCE OR REJECTION - BID ACCOMPANIED BY BIDDER'S FORM CONTAINING PROVISIONS CONTRARY TO STANDARD FORM - QUALIFICATION OF TIME OF DELIVERY A LOW BID ACCOMPANIED BY THE BIDDER'S " STANDARD CONDITIONS OF SALES" PROVISIONS, WHICH ARE CONTRARY TO THE STANDARD GOVERNMENT CONTRACT FORM, AND QUALIFIED BY A WRITTEN STATEMENT THAT THE BIDDER ESTIMATES SHIPMENT OF THE MATERIAL CAN BE MADE IN ACCORDANCE WITH THE DESIRED TIME OF DELIVERY SHOULD BE REJECTED AS NONRESPONSIVE REGARDLESS OF THE BIDDER'S INTENT TO COMPLY WITH THE ADVERTISED SPECIFICATIONS AND CONDITIONS.

TO AJAX ELECTROTHERMIC CORPORATION, AUGUST 13, 1957:

FURTHER REFERENCE IS MADE TO YOUR TELEGRAM OF JULY 15, 1957, PROTESTING THE AWARD OF A CONTRACT UNDER INVITATION NO. IFB600-1993-57, ISSUED BY THE BUREAU OF SUPPLIES AND ACCOUNTS, DEPARTMENT OF THE NAVY MAY 17, 1957.

IN YOUR TELEGRAM YOU STATED THAT THE PROCURING AGENCY ADVISED YOU THAT THIS CONTRACT HAD BEEN AWARDED TO THE NEXT LOWEST BIDDER DUE TO A RULING BY OUR OFFICE. YOU ALSO STATED THAT ALTHOUGH YOUR BID WAS $7,000 LOWER IT WAS REJECTED DUE TO A MINOR TECHNICALITY, AND THAT SEVERAL DAYS PRIOR TO THE AWARDING OF THIS CONTRACT "WE DELETED THE ITEM WHICH INADVERTENTLY APPEARED ON OUR STANDARD COMMERCIAL FORM WHICH DOES NOT APPLY TO GOVERNMENT BIDS.'

THE PROCURING AGENCY HAS REPORTED THAT A MISTAKE IN BID WAS ALLEGED BY YOUR FIRM WITH RESPECT TO WHICH THE ASSISTANT CHIEF FOR PURCHASING, BUREAU OF SUPPLIES AND ACCOUNTS, MADE THE FOLLOWING FINDINGS AND DETERMINATION:

FINDINGS

1. THE CONTRACTING OFFICER REPORTS THAT BIDS WERE OPENED 7 JUNE 1957, INVITATION NO. 600-1993-57, INCLUDING UNDER ITEM 1, ONE INDUCTION TYPE MELTING FURNACE COMPLETE WITH SPARE PARTS AND INSTALLATION MATERIALS. THE INVITATION PROVIDES THAT THE DESIRED DELIVERY DATE IS FEBRUARY 1958, AND THE MAXIMUM ACCEPTABLE DELIVERY DATE IS JUNE 1958. THE LOW BID OF $55,401.40 WAS MADE BY AJAX ELECTROTHERMIC CORPORATION--- SECOND AND THIRD LOW BIDS OF $62,625.25 AND $65,433.50 WERE RECEIVED.

2. IN EVALUATING THE BIDS THE CONTRACTING OFFICER NOTED THAT AJAX SHOWED A FIRM DELIVERY DATE OF FEBRUARY 1958 IN THE BID PROPER, AND ON PAGE 2 OF THE BID MADE THE FOLLOWING NOTATION " PLEASE CONSIDER QUOTATION 52857-H AND PROPOSITIONS NOS. 52857-H AND 52857-H1 PART OF THIS BID.' QUOTATION 52857-H (IN LETTER-FORM DATED 3 JUNE 1957) WHICH WAS ATTACHED TO THE BID CONTAINED THE FOLLOWING STATEMENTS:

"WE ESTIMATE SHIPMENT OF THIS MATERIAL CAN BE MADE IN ACCORDANCE WITH SPECIFICATIONS BY FEBRUARY 1958. EARLIER DELIVERY MAY BE POSSIBLE IF DESIRED.'

IT WAS FURTHER NOTED THAT THE LETTER OF 3 JUNE 1957 HAD THE BIDDER'S " STANDARD CONDITIONS OF SALE" PRINTED ON ITS REVERSE SIDE, AND HAD THE FOLLOWING PRINTED ON ITS FACE:

"THIS QUOTATION IS MADE SUBJECT TO OUR STANDARD CONDITIONS OF SALE PRINTED ON THE REVERSE OF THIS PAGE.'

IN VIEW OF THE AMBIGUITY OF DELIVERY TERM SHOWN IN THE BID AND ACCOMPANYING LETTER, THE NOTATION MADE IN THE BID, AND BIDDER'S PRINTED PROVISIONS WHICH ARE CONTRARY TO THE STANDARD GOVERNMENT CONTRACT FORM, CONFIRMATION OF THE BID WAS REQUESTED BY THE CONTRACTING OFFICER.

3. BY TELEGRAM OF 26 JUNE 1957, AJAX ELECTROTHERMIC CORPORATION ALLEGED THAT ITS INTENT WAS TO INDICATE THAT DELIVERY EARLIER THAN FEBRUARY 1958 MAY BE POSSIBLE IF DESIRED BY THE GOVERNMENT, AND THAT THE STATEMENT MADE IN ITS LETTER OF 3 JUNE 1957 WAS NOT MEANT TO CONFLICT WITH FIRM DELIVERY OF FEBRUARY 1958. THE BIDDER FURTHER ALLEGED THAT ITS STANDARD TERMS AND CONDITIONS OF SALE AND THE PROVISION MAKING THE INSTANT BID SUBJECT THERETO WERE INCLUDED IN THE BID IN ERROR. CORRECTION OF THE BID AND CONSIDERATION AS INTENDED WAS REQUESTED.

4. THE CONTRACTING OFFICER EXPRESSED HIS BELIEF THAT AJAX SUBMITTED AN ERRONEOUS BID, AND RECOMMENDED THAT RELIEF BE GRANTED.

DETERMINATION

IT IS HEREBY DETERMINED THAT THE BID OF AJAX ELECTROTHERMIC CORPORATION MAY NOT BE CORRECTED, BUT SHOULD BE CONSIDERED AS SUBMITTED, AND THAT, AS SUBMITTED, THE BID IS UNRESPONSIVE TO THE TERMS OF THE INVITATION FOR BIDS, 36 COMP. GEN. 535.

IN THE DECISION OF OUR OFFICE REFERRED TO AS AUTHORITY FOR THE ADMINISTRATIVE ACTION TAKEN, 36 COMP. GEN. 535, CONSIDERATION WAS GIVEN TO THE EFFECT CERTAIN TYPEWRITTEN PROVISIONS AND PRINTED CONDITIONS IMPOSED BY A BIDDER, SIMILAR TO THOSE INCORPORATED IN YOUR BID, WOULD HAVE ON THE GOVERNMENT'S RIGHTS IN THE MATTER, IF THE BID WERE ACCEPTED. AS YOU DID IN THIS INSTANCE, THE BIDDER THERE REQUESTED THAT ALL PRINTED MATTER INCLUDED IN HIS QUOTATION BE CONSIDERED AS NOTHING MORE THAN AN INFORMALITY IN BIDDING WHICH SHOULD BE WAIVED ON THE GROUND HE HAD INTENDED THAT HIS BID WOULD COMPLY STRICTLY WITH THE ADVERTISED SPECIFICATIONS AND CONDITIONS. IT WAS HELD THAT UNDER THE PRINCIPLES OF LAW FOR APPLICATION IN SUCH CASES, THE BIDDER'S TYPEWRITTEN PROVISIONS AND PRINTED CONDITIONS WOULD CONTROL THE GOVERNMENT'S RIGHTS IN THE MATTER AND THAT THE BID, CONDITIONED AS IT WAS, MUST BE REJECTED AS NOT BEING RESPONSIVE TO THE INVITATION FOR BIDS.

AS SET OUT IN THE DECISION, 36 COMP. GEN. 535, COPY ATTACHED, IT IS A CARDINAL RULE THAT A CONTRACT AWARDED TO A SUCCESSFUL BIDDER MUST BE THE CONTRACT OFFERED TO ALL BIDDERS. WHERE ONE BIDDER RESERVES RIGHTS AND IMMUNITIES FROM RESPONSIBILITY NOT EXTENDED TO ALL BIDDERS BY THE ADVERTISED CONDITIONS AND SPECIFICATIONS, IT SEEMS MANIFEST THAT A CONTRACT AWARDED UPON THE BASIS OF THE CONDITIONAL BID WOULD NOT BE THE CONTRACT OFFERED TO ALL PROSPECTIVE BIDDERS. INFORMALITIES WHICH PROPERLY MAY BE WAIVED ARE THOSE THAT DO NOT GO TO THE SUBSTANCE OF THE BID SO AS TO BE PREJUDICIAL TO THE RIGHTS OF OTHER BIDDERS, BUT MATERIAL CONDITIONS IMPOSED BY A BIDDER MAY NOT BE WAIVED AS AN INFORMALITY OR MINOR IRREGULARITY. SEE 20 COMP. GEN. 4. TO PERMIT PUBLIC OFFICERS TO ACCEPT BIDS NOT COMPLYING IN SUBSTANCE WITH THE ADVERTISED SPECIFICATIONS, OR TO PERMIT BIDDERS TO VARY THEIR PROPOSALS AFTER THE BIDS ARE OPENED, WOULD SOON REDUCE TO A FARCE THE WHOLE PROCEDURE OF LETTING PUBLIC CONTRACTS ON AN OPEN COMPETITIVE BASIS. THE STRICT MAINTENANCE OF SUCH PROCEDURE, REQUIRED BY LAW, IS INDEFINITELY MORE IN THE PUBLIC INTEREST THAN OBTAIN AN APPARENTLY PECUNIARY ADVANTAGE IN A PARTICULAR CASE BY A VIOLATION OF THE RULES. CF. UNITED STATES V. BROOKRIDGE, 111 F.2D 461, 464, AND THE OPINION OF THE SUPREME COURT OF ILLINOIS IN CITY OF CHICAGO V. MOHR, 74 N.E. 1056.

THE STATEMENT IN YOUR BID QUALIFYING THE DATE OF SHIPMENT AND THE VARIOUS CLAUSES SET OUT IN YOUR " STANDARD CONDITIONS OF SALE" RELATIVE TO WARRANTY, PATENTS, DELIVERY, CANCELLATION, ETC., CAN HARDLY BE REGARDED A MINOR TECHNICALITY, AS SUGGESTED IN YOUR TELEGRAM. THESE CONDITIONS OBVIOUSLY AFFECT THE SUBSTANCE OF YOUR BID AND REASONABLY WARRANT THE DETERMINATION, ADMINISTRATIVELY MADE, THAT YOUR BID IS NOT RESPONSIVE TO THE INVITATION.

IT IS OUR VIEW, THEREFORE, THAT IN DISREGARDING YOUR BID AND AWARDING THE CONTRACT TO THE BIDDER MEETING THE ADVERTISED SPECIFICATIONS AND CONDITIONS THE PROCURING AGENCY WAS ACTING WITHIN ITS AUTHORITY AND IN ACCORDANCE WITH THE RULES FOR APPLICATION UNCER THE EXISTING FACTS AND CIRCUMSTANCES.