B-134233, JANUARY 28, 1958, 37 COMP. GEN. 495

B-134233: Jan 28, 1958

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CONTRACT REQUIREMENT UNDER AN INVITATION WHICH REQUIRES THE SUBMISSION OF DESCRIPTIVE DATA AND UNDER A CONTRACT WHICH DOES NOT INCORPORATE THE DESCRIPTIVE DATA BUT MERELY REQUIRES THE FURNISHING OF EQUIPMENT OF ANY REPUTABLE MANUFACTURER PROVIDED THE SPECIFICATIONS ARE MET. THE CONTRACTOR IS NOT REQUIRED TO FURNISH EQUIPMENT OF THE SAME MANUFACTURER AS THAT ILLUSTRATED IN THE DESCRIPTIVE DATA BUT ONLY EQUIPMENT OF A REPUTABLE MANUFACTURER PROVIDED IT MEETS THE SPECIFICATIONS. 1958: REFERENCE IS MADE TO LETTER DATED OCTOBER 28. W. SCHMID PLUMBING AND HEATING COMPANY SHOULD HAVE BEEN REQUIRED TO FURNISH BOILER PLANT EQUIPMENT CONFORMING TO DATA SUBMITTED WITH ITS BID. WHICH WAS THE BASIS OF CONTRACT NO.

B-134233, JANUARY 28, 1958, 37 COMP. GEN. 495

CONTRACTS - SPECIFICATIONS - DESCRIPTIVE DATA - INVITATION V. CONTRACT REQUIREMENT UNDER AN INVITATION WHICH REQUIRES THE SUBMISSION OF DESCRIPTIVE DATA AND UNDER A CONTRACT WHICH DOES NOT INCORPORATE THE DESCRIPTIVE DATA BUT MERELY REQUIRES THE FURNISHING OF EQUIPMENT OF ANY REPUTABLE MANUFACTURER PROVIDED THE SPECIFICATIONS ARE MET, AN AWARD TO THE LOW BIDDER WHO SUBMITS DESCRIPTIVE DATA OF A PARTICULAR MANUFACTURER BUT WHO INTENDS TO FURNISH EQUIPMENT OF ANOTHER MANUFACTURER RESULTS IN A VALID CONTRACT, AND THE CONTRACTOR IS NOT REQUIRED TO FURNISH EQUIPMENT OF THE SAME MANUFACTURER AS THAT ILLUSTRATED IN THE DESCRIPTIVE DATA BUT ONLY EQUIPMENT OF A REPUTABLE MANUFACTURER PROVIDED IT MEETS THE SPECIFICATIONS.

TO THE SECRETARY OF THE ARMY, JANUARY 28, 1958:

REFERENCE IS MADE TO LETTER DATED OCTOBER 28, 1957, FROM THE DEPUTY ASSISTANT SECRETARY ( LOGISTICS), REQUESTING A DECISION AS TO WHETHER C. W. SCHMID PLUMBING AND HEATING COMPANY SHOULD HAVE BEEN REQUIRED TO FURNISH BOILER PLANT EQUIPMENT CONFORMING TO DATA SUBMITTED WITH ITS BID, WHICH WAS THE BASIS OF CONTRACT NO. DA-25-066-ENG-4333, DATED MARCH 15, 1957.

THE CORPS OF ENGINEERS, OMAHA DISTRICT, BY INVITATION FOR BIDS NO. 25-066 -57-70, REQUESTED BIDS TO BE OPENED ON FEBRUARY 28, 1957, FOR THE EXTENSION OF THE CENTRAL HEATING PLANT, FURNISHING AND INSTALLING HOT WATER GENERATORS, AUXILIARY PIPING AND PUMPING EQUIPMENT, AND ELECTRICAL WORK AT MINOT AIR FORCE BASE, MINOT, NORTH DAKOTA, IN ACCORDANCE WITH CERTAIN SPECIFICATIONS, SCHEDULES AND DRAWINGS. THE BID FORM PROVIDED THAT THE BIDDER AGREED THAT, UPON THE WRITTEN ACCEPTANCE OF ITS BID, IT WOULD EXECUTE STANDARD FORM 23, CONSTRUCTION CONTRACT, AS AMENDED, AND GIVE PERFORMANCE BOND AND PAYMENT BOND ON GOVERNMENT STANDARD FORMS WITH GOOD AND SUFFICIENT SURETY OR SURETIES.

PART IV OF THE TECHNICAL PROVISIONS OF THE SPECIFICATIONS, BOILER PLANT, PROVIDES, IN PART, AS FOLLOWS:

16-03. GENERAL.

B. STANDARD PRODUCTS. THE EQUIPMENT TO BE FURNISHED UNDER THIS SPECIFICATION SHALL BE ESSENTIALLY THE STANDARD PRODUCTS OF THE MANUFACTURER BUT MODIFIED IN ACCORDANCE WITH THE REQUIREMENTS OF THIS INSTALLATION AND THE SPECIFICATIONS. WHERE TWO OR MORE UNITS OF THE SAME CLASS OF EQUIPMENT ARE REQUIRED, THESE UNITS SHALL BE THE PRODUCTS OF A SINGLE MANUFACTURER. * * *.

D. APPROVAL OF SHOP DRAWINGS, MATERIALS AND EQUIPMENT. AS SOON AS PRACTICABLE AND WITHIN 30 DAYS AFTER AWARD OF CONTRACT AND BEFORE ANY MATERIALS OR EQUIPMENT ARE PURCHASED, THE CONTRACTOR SHALL SUBMIT FOR APPROVAL, AS SPECIFIED IN PART III--- SPECIAL CONDITIONS, CATALOGS, CUTS, DIAGRAMS, DRAWINGS AND SUCH OTHER DESCRIPTIVE DATA AS MAY BE REQUIRED OF MATERIALS AND EQUIPMENT TO BE INCORPORATED IN THE WORK, TOGETHER WITH THE NAMES AND ADDRESSES OF THE MANUFACTURERS AND THEIR CATALOG NUMBERS AND TRADE NAMES. A NOTATION SHALL BE MADE ON EACH ITEM SUBMITTED AS TO ITS SPECIFIC USE, BY REFERENCE TO THE APPLICABLE PARAGRAPH OF THE SPECIFICATIONS OR BY DESCRIPTION OF ITS SPECIFIC LOCATION IN THE WORK. ANY MATERIALS AND EQUIPMENT NOT CONFORMING TO THE SPECIFICATIONS MAY BE REJECTED. THE PRODUCT OF ANY REPUTABLE MANUFACTURER REGULARLY ENGAGED IN THE COMMERCIAL PRODUCTION OF THE EQUIPMENT HEREIN SPECIFIED WILL NOT BE EXCLUDED ON THE BASIS OF MINOR DIFFERENCES, PROVIDED ALL ESSENTIAL REQUIREMENTS OF THIS SPECIFICATION RELATIVE TO MATERIALS, CAPACITY AND PERFORMANCE ARE MET. * * *.

16-19. DATA SHEET

A. THE FOLLOWING INFORMATION SHALL BE COMPLETED IN FULL AND SUPPLIED WITH THE BID ON THE PROJECT. EVALUATION OF THE EQUIPMENT DATA SUBMITTED MAY CONSTITUTE A BASIS FOR ACCEPTING OR REJECTING THE CONTRACTOR'S BID. AWARD OF THE CONTRACT OR APPROVAL OF THE DATA BY THE CONTRACTING OFFICER, HOWEVER, WILL NOT RELEASE THE CONTRACTOR FROM COMPLIANCE WITH ALL SPECIFICATION SECTIONS. * * *.

IN RESPONSE TO THE INVITATION BIDS WERE RECEIVED AS FOLLOWS:

AMOUNT BIDS AS

BIDDER DATE OF BID OF ORIGINAL MODIFIED

BID PRIOR TO

OPENING

(A) C. W.

SCHMID----------- FEB. 26, 1957 $780.000 $746,000 (B) DETWEILERS, INC---- --- FEB. 28, 1957 759,456 759,456 (C) HANSEN 1NEIDERHAUSER--- FEB. 25, 1957 900,000 760,000 (D) C. A. HOOPER COMPANY--- FEB. 28, 1957768,867 768,867

THE BIDS OF C. W. SCHMID AND HANSEN-1NIEDERHAUSER WERE MODIFIED BY TELEGRAMS OF FEBRUARY 28 WHICH WERE RECEIVED PRIOR TO THE OPENING. THE TELEGRAM OF C. W. SCHMID MERELY OFFERED THE PRICE REDUCTION AND DID NOT MAKE ANY REFERENCE TO THE BOILER SUPPLIER OR INSTALLATION. THE TELEGRAM OF HANSEN-1NIEDERHAUSER STATED THAT BOILERS OF EITHER MANUFACTURER WOULD BE FURNISHED AT THE GOVERNMENT'S OPTION.

ALL THE BIDDERS COMPLIED WITH REQUIREMENTS OF PARAGRAPH 16-19, DATA SHEET, SUPRA. THE DATA SHEETS SUBMITTED INDICATED THAT THEY WOULD FURNISH EQUIPMENT FROM THE FOLLOWING SUPPLIERS:

A. C. W. SCHMID--- INTERNATIONAL BOILER WORKS COMPANY

B. DETWEILERS, INC.--- INTERNATIONAL BOILER WORKS COMPANY

C. HANSEN-1NIEDERHAUSER, INC.--- INTERNATIONAL BOILER WORKS COMPANY OR COMBUSTION ENGINEERING INC. (AT GOVERNMENT OPTION)

D. C. A. HOOPER COMPANY--- COMBUSTION ENGINEERING, INC.

IT IS REPORTED THAT THE EQUIPMENT MANUFACTURED BY THE TWO SUPPLIERS FULLY COMPLIES WITH REQUIREMENTS OF THE SPECIFICATIONS.

THE BID OF C. W. SCHMID, BEING THE LOWEST RECEIVED AND COMPLYING WITH THE REQUIREMENTS AND TERMS OF THE INVITATION, WAS ACCEPTED ON MARCH 15, 1957, AND, THEREAFTER, PERFORMANCE AND PAYMENT BONDS WERE OBTAINED AND THE FORMAL CONTRACT (DA-25-066-ENG-4333) WAS EXECUTED BY THE PARTIES. THE NOTICE TO PROCEED WAS ISSUED ON MARCH 29 AND RECEIPT THEREOF WAS ACKNOWLEDGED BY THE CONTRACTOR ON APRIL 1, 1957. THE FORMAL CONTRACT DOES NOT INCLUDE OR INCORPORATE BY REFERENCE THE DESCRIPTIVE DATA SUBMITTED WITH THE BID.

ON MAY 14, 1957, THE CONTRACTOR SUBMITTED SHOP DRAWINGS FOR APPROVAL AS REQUIRED BY PARAGRAPH 16-03D. THEY WERE RETURNED BY LETTER DATED MAY 17, 1957, TO THE CONTRACTOR WITHOUT APPROVAL FOR THE REASON THAT THE EQUIPMENT SHOWN ON THE DRAWINGS DID NOT CONFORM TO THE DIMENSION AND SIZES OF THE EQUIPMENT SET FORTH IN THE DESCRIPTIVE DATA SUBMITTED WITH THE BID. THE CONTRACTOR ALSO WAS INFORMED THAT THE DESCRIPTIVE DATA WERE USED AS A BASIS FOR EVALUATING THE BID AND THAT ALL EQUIPMENT INSTALLED MUST CONFORM TO THE DIMENSIONS, SIZES, WEIGHTS AND PERFORMANCE SET FORTH IN THE DESCRIPTIVE DATA SUBMITTED WITH THE BID. BY TELEGRAM DATED MAY 23, 1957, THE CONTRACTOR PROTESTED SUCH ACTION AND BY WIRE OF MAY 27, THE CONTRACTOR WAS AGAIN ADVISED THAT THE EQUIPMENT WHICH DID NOT CONFORM TO THE DESCRIPTIVE DATA SUBMITTED WITH THE BID WOULD BE REJECTED. BY WIRE DATED MAY 28 THE CONTRACTOR REITERATED HIS PROTEST AND REQUESTED A WRITTEN DECISION BY THE CONTRACTING OFFICER. IN A FORMAL DETERMINATION DATED JUNE 26, 1957, THE CONTRACTING OFFICER DENIED THE CONTRACTOR'S CLAIMS THAT HE WAS ENTITLED TO FURNISH AND INSTALL EQUIPMENT OTHER THAN THAT SHOWN IN THE DESCRIPTIVE DATA SUBMITTED WITH THE BID. THE CONTRACTOR APPEALED THIS DETERMINATION TO THE CHIEF OF ENGINEERS.

IN ADDITION TO THE CONTRACTOR'S CLAIM THAT HE IS ENTITLED UNDER THE TERMS OF THE CONTRACT TO INSTALL EQUIPMENT MANUFACTURED BY COMBUSTION ENGINEERING, INC., SINCE IT MEETS THE REQUIREMENTS IN THE SPECIFICATIONS, THE CONTRACTOR ALLEGES THAT WHILE HIS ORIGINAL BID OF $780,000 WAS BASED ON THE INTERNATIONAL BOILER WORKS COMPANY FURNISHING AND INSTALLING THE BOILERS AND AUXILIARY EQUIPMENT, HE RECEIVED A QUOTATION FROM COMBUSTION ENGINEERING, INC., ON SAID EQUIPMENT, WITHOUT INSTALLATION, WHICH WOULD PERMIT HIM TO REDUCE HIS ORIGINAL BID AND THAT THIS WAS THE PRIMARY REASON FOR THE TELEGRAM OF FEBRUARY 28, 1957, REDUCING HIS BID BY $34,000. IT IS ALLEGED THAT THE FINAL BID WAS, IN FACT, BASED ON FURNISHING COMBUSTION ENGINEERING EQUIPMENT, ALTHOUGH HE FAILED TO CHANGE THE DATA OR TO NOTIFY THE GOVERNMENT.

THE CHIEF OF ENGINEERS REVIEWED THE CONTRACTING OFFICER'S DECISION AND DETERMINED THAT THE EQUIPMENT MADE BY COMBUSTION ENGINEERING AND OFFERED BY THE CONTRACTOR SHOULD BE APPROVED FOR INSTALLATION, SINCE IT MET THE REQUIREMENTS OF THE SPECIFICATIONS AND SINCE THE DESCRIPTIVE DATA WAS NOT MADE A PART OF THE CONTRACT. THE CONTRACTING OFFICER WAS INSTRUCTED ACCORDINGLY AND THE CONTRACTOR HAS PROCEEDED WITH PERFORMANCE.

A DECISION IS REQUESTED IN THE MATTER SINCE, IT IS STATED, THE CHIEF OF ENGINEERS' DETERMINATION THAT THE DESCRIPTIVE DATA SUBMITTED WITH THE BID DID NOT BECOME A PART OF THE CONTRACT IS NOT FREE FROM DOUBT, AND SINCE FURTHER DOUBT EXISTS AS TO WHETHER THERE WAS A MEETING OF THE MINDS SO AS TO BRING INTO EFFECT A CONTRACT REPRESENTING THE ACTUAL AGREEMENT OF THE PARTIES AND, IF SO, WHETHER THE CONTRACTOR SHOULD HAVE BEEN REQUIRED TO FURNISH EQUIPMENT CONFORMING TO SUCH DATA.

SECTION 16, PART IV, TECHNICAL SPECIFICATIONS, OF THE INVITATION, COVERS THE REQUIREMENTS WITH RESPECT TO BOILERS AND AUXILIARY EQUIPMENT. UNDER THE TERMS OF THE VARIOUS PARAGRAPHS OF THAT SECTION THE TYPE OF EQUIPMENT, MATERIALS, CAPACITY AND PERFORMANCE, ARE DESCRIBED WITHOUT ANY REFERENCE TO THE EQUIPMENT OF ANY PARTICULAR MANUFACTURER. PARAGRAPH 16-03D PROVIDES THAT WITHIN 30 DAYS AFTER DATE OF AWARD OF THE CONTRACT, THE CONTRACTOR SHALL SUBMIT FOR APPROVAL CATALOGS, CUTS, DIAGRAMS, DRAWINGS AND SUCH OTHER DESCRIPTIVE DATA AS MAY BE REQUIRED OF MATERIALS AND EQUIPMENT TO BE INCORPORATED IN THE WORK, TOGETHER WITH THE NAMES AND ADDRESSES OF THE MANUFACTURERS AND THEIR CATALOG NUMBERS AND TRADE NAMES; THAT ANY MATERIALS AND EQUIPMENT NOT CONFORMING TO THE SPECIFICATIONS MAY BE REJECTED; AND THAT "THE PRODUCT OF ANY REPUTABLE MANUFACTURER REGULARLY ENGAGED IN THE COMMERCIAL PRODUCTION OF THE EQUIPMENT HEREIN SPECIFIED WILL NOT BE EXCLUDED ON THE BASIS OF MINOR DIFFERENCES, PROVIDED ALL ESSENTIAL REQUIREMENTS OF THIS SPECIFICATION RELATIVE TO MATERIALS, CAPACITY AND PERFORMANCE ARE MET.' ( ITALICS SUPPLIED.)

PARAGRAPH 16-19 PROVIDES THAT THE BIDDER SHALL SUBMIT WITH HIS BID CERTAIN DESCRIPTIVE DATA AND THAT THE "EVALUATION OF THE EQUIPMENT DATA SUBMITTED MAY CONSTITUTE A BASIS FOR ACCEPTING OR REJECTING THE CONTRACTOR'S BID. AWARD OF THE CONTRACT OR APPROVAL OF THE DATA BY THE CONTRACTING OFFICER, HOWEVER, WILL NOT RELEASE THE CONTRACTOR FROM COMPLIANCE WITH ALL SPECIFICATION SECTIONS.' ( ITALICS SUPPLIED.)

C. W. SCHMID DESCRIBED INTERNATIONAL BOILER WORKS EQUIPMENT IN THE DESCRIPTIVE DATA ACCOMPANYING HIS BID DATED FEBRUARY 26, 1957, BUT HE ALLEGES THAT THE PRIMARY REASON FOR THE REDUCTION IN THE BID PRICE WAS DUE TO THE FACT THAT HE THEN INTENDED TO FURNISH COMBUSTION ENGINEERING EQUIPMENT, ALTHOUGH HE FAILED TO NOTIFY THE GOVERNMENT OF THE CHANGE.

ALTHOUGH THE CONTRACTING OFFICER DETERMINED THAT SCHMID SHOULD BE REQUIRED TO FURNISH INTERNATIONAL EQUIPMENT SINCE HIS BID WAS EVALUATED ON THAT BASIS, IT WOULD APPEAR THAT THE ACTUAL AND ONLY PROPER BASIS FOR THE AWARD WAS THAT SCHMID WAS THE LOWEST RESPONSIBLE BIDDER OFFERING TO COMPLY WITH THE SPECIFICATIONS. WHILE SCHMID SUBMITTED DATA WITH HIS BID WHICH INDICATED THAT HE WOULD FURNISH INTERNATIONAL EQUIPMENT, HE WOULD HAVE ALSO BEEN ENTITLED TO THE AWARD HAD HE SUBMITTED THE DATA ON COMBUSTION EQUIPMENT, SINCE BOTH MET THE REQUIREMENTS OF THE SPECIFICATIONS. THE PRIMARY CONSIDERATION WAS NOT THE IDENTITY OF THE MANUFACTURER OF THE EQUIPMENT BUT THAT THE EQUIPMENT MEET THE SPECIFICATION REQUIREMENTS AND THAT IT BE THE PRODUCT OF A REPUTABLE MANUFACTURER ENGAGED IN THE COMMERCIAL PRODUCTION OF SUCH EQUIPMENT. FURTHERMORE, PARAGRAPH 16-19 PROVIDED ONLY THAT THE DATA "MAY" CONSTITUTE A BASIS FOR ACCEPTING OR REJECTING THE BID AND THAT REGARDLESS OF THE APPROVAL OF THE DATA BY THE CONTRACTING OFFICER, THE CONTRACTOR WAS STILL REQUIRED TO COMPLY WITH ALL SPECIFICATION SECTIONS.

IN VIEW OF THESE VARIOUS PROVISIONS OF THE SPECIFICATIONS, THE EXACT PURPOSE OF THE DATA REQUIRED TO BE FURNISHED WITH THE BID WAS AT LEAST AMBIGUOUS. IN THIS CONNECTION, SEE 36 COMP. GEN. 376. IN ANY EVENT, THE DATA WAS NOT MADE A PART OF THE FORMAL CONTRACT. UNDER THE SPECIFIC TERMS OF THE CONTRACT, THE CONTRACTOR MAY, AND IS, REQUIRED TO FURNISH EQUIPMENT WHICH IS "THE PRODUCT OF ANY REPUTABLE MANUFACTURER REGULARLY ENGAGED IN THE COMMERCIAL PRODUCTION OF THE EQUIPMENT HEREIN SPECIFIED * * * PROVIDED ALL ESSENTIAL REQUIREMENTS OF THIS SPECIFICATION RELATIVE TO MATERIALS, CAPACITY AND PERFORMANCE ARE MET.'

IT IS OUR OPINION, THEREFORE, THAT A VALID AND BINDING CONTRACT EXISTS BETWEEN THE PARTIES AND THAT THE CONTRACTOR MAY FURNISH EQUIPMENT OF ANY REPUTABLE MANUFACTURER REGULARLY ENGAGED IN THE COMMERCIAL PRODUCTION OF SUCH EQUIPMENT AND PROVIDED IT MEETS THE REQUIREMENTS OF THE SPECIFICATIONS.