B-136794, SEPTEMBER 23, 1958, 38 COMP. GEN. 235

B-136794: Sep 23, 1958

Additional Materials:

Contact:

Edda Emmanuelli Perez
(202) 512-2853
EmmanuelliPerezE@gao.gov

 

Office of Public Affairs
(202) 512-4800
youngc1@gao.gov

WHICH WERE SPECIFIED IN THE INVITATION AND WHICH WOULD HAVE NECESSITATED MULTIPLE AWARDS. WAS WITHIN THE AUTHORITY OF THE PROCUREMENT AGENCY AND THE LOW BIDDER HAS NO BASIS FOR PROTEST WHEN THE AGENCY DETERMINES FOR VALID REASONS THAT THE PUBLIC INTEREST REQUIRES READVERTISEMENT. 1958: FURTHER REFERENCE IS MADE TO YOUR LETTER OF JULY 11. WE HAVE RECEIVED A REPORT IN THE MATTER FROM THE GENERAL SERVICES ADMINISTRATION STATING THAT YOUR REPRESENTATIVES WERE FURNISHED A FULL AND COMPLETE EXPLANATION OF THE CIRCUMSTANCES AND LEGAL CONSIDERATIONS JUSTIFYING THE CANCELLATION OF THE INVITATION ISSUED ON APRIL 7. THE INVITATION WAS CANCELED ON JUNE 26. BOTH YOUR COMPANY AND THE AMERICAN EXPANSION BOLT AND MANUFACTURING COMPANY WERE REQUESTED TO EXTEND THEIR FISCAL YEAR 1958 CONTRACTS FOR A PERIOD OF 60 DAYS IN ORDER TO ALLOW SUFFICIENT TIME TO READVERTISE FOR PROPOSALS COVERING THE BALANCE OF THE FISCAL YEAR 1959.

B-136794, SEPTEMBER 23, 1958, 38 COMP. GEN. 235

BIDS - DISCARDING ALL BIDS - READVERTISEMENT - JUSTIFICATION - MULTIPLE AWARD ELIMINATION AN ADMINISTRATIVE DETERMINATION TO READVERTISE A PROCUREMENT BECAUSE EXPERIMENTATION INDICATED THAT ONE TYPE OF ITEM WOULD BE AS SATISFACTORY AS THE SEVERAL DIFFERENT TYPES, WHICH WERE SPECIFIED IN THE INVITATION AND WHICH WOULD HAVE NECESSITATED MULTIPLE AWARDS, WAS WITHIN THE AUTHORITY OF THE PROCUREMENT AGENCY AND THE LOW BIDDER HAS NO BASIS FOR PROTEST WHEN THE AGENCY DETERMINES FOR VALID REASONS THAT THE PUBLIC INTEREST REQUIRES READVERTISEMENT.

TO THE ADDRESSOGRAPH-1MULTIGRAPH CORPORATION, SEPTEMBER 23, 1958:

FURTHER REFERENCE IS MADE TO YOUR LETTER OF JULY 11, 1958, PROTESTING THE EXTENSION OF FEDERAL SUPPLY SCHEDULE CONTRACT NO. GS-00S 15762, WITH THE AMERICAN EXPANSION BOLT AND MANUFACTURING COMPANY, AND A PROPOSED READVERTISEMENT FOR BIDS ON ADDRESSING MACHINE PLATES TO MEET THE REQUIREMENTS OF THE GOVERNMENT FOR A PERIOD LESS THAN THAT STATED IN AN INVITATION FOR BIDS ISSUED ON APRIL 7, 1958, BY THE GENERAL SERVICES ADMINISTRATION, FEDERAL SUPPLY SERVICE.

WE HAVE RECEIVED A REPORT IN THE MATTER FROM THE GENERAL SERVICES ADMINISTRATION STATING THAT YOUR REPRESENTATIVES WERE FURNISHED A FULL AND COMPLETE EXPLANATION OF THE CIRCUMSTANCES AND LEGAL CONSIDERATIONS JUSTIFYING THE CANCELLATION OF THE INVITATION ISSUED ON APRIL 7, 1958, WHICH REQUESTED PROPOSALS FOR DELIVERIES AS REQUIRED BY THE GOVERNMENT DURING THE PERIOD JULY 1, 1958, TO JUNE 30, 1959. THE INVITATION WAS CANCELED ON JUNE 26, 1958, AND BOTH YOUR COMPANY AND THE AMERICAN EXPANSION BOLT AND MANUFACTURING COMPANY WERE REQUESTED TO EXTEND THEIR FISCAL YEAR 1958 CONTRACTS FOR A PERIOD OF 60 DAYS IN ORDER TO ALLOW SUFFICIENT TIME TO READVERTISE FOR PROPOSALS COVERING THE BALANCE OF THE FISCAL YEAR 1959. THE AMERICAN EXPANSION BOLT AND MANUFACTURING COMPANY AGREED TO THE PROPOSED EXTENSION OF ITS FISCAL YEAR 1958 CONTRACT BUT YOU REFUSED TO MAKE YOUR PRODUCTS AVAILABLE DURING THE INTERIM PERIOD EXCEPT THROUGH PURCHASES IN THE OPEN MARKET. YOU WERE THE LOW BIDDER AS TO CERTAIN STYLES OF TIN COATED PLATES AND BELIEVED THAT YOU WERE ENTITLED TO AN AWARD OF A CONTRACT UNDER THE ORIGINAL INVITATION. IT WAS CONTENDED IN YOUR LETTER OF JULY 11, 1958, THAT THE EXTENSION OF CONTRACT NO. GS-OOS- 15762 EXCEEDED THE POWER AND AUTHORITY OF THE GENERAL SERVICES ADMINISTRATION; THAT THE DECISION TO READVERTISE WAS ARBITRARY, UNFAIR AND CONTRARY TO LAW; AND THE READVERTISEMENT WOULD GIVE AN UNFAIR ADVANTAGE TO OTHER BIDDERS. YOUR PROTEST APPEARS TO HAVE BEEN DIRECTED PRIMARILY TO ANY SUBSTANTIAL AMOUNT OF BUSINESS WHICH MIGHT SUBSEQUENTLY BE AWARDED TO YOUR PRINCIPAL COMPETITOR, THE AMERICAN EXPANSION BOLT AND MANUFACTURING COMPANY, WHICH SUBMITTED THE ONLY QUOTATIONS ON ORGANIC COATED STEEL ADDRESSING MACHINE PLATES.

CONTRARY TO YOUR SUGGESTION THAT THE DECISION TO READVERTISE WAS NOT MADE IN GOOD FAITH AND WAS THE RESULT OF PRESSURE FROM THE AMERICAN EXPANSION BOLT AND MANUFACTURING COMPANY, THE ADMINISTRATIVE REPORT ON YOUR PROTEST SHOWS THAT THE DECISION TO READVERTISE RESULTED DIRECTLY FROM THE INVESTIGATION OF A FIELD OFFICE COMPLAINT THAT DIFFICULTY HAD BEEN ENCOUNTERED IN USING ORGANIC COATED PLATES. AFTER CONSIDERABLE EXPERIMENTATION IT WAS FOUND THAT THE WIDTH OF THE PLATES DETERMINED SATISFACTORY OR UNSATISFACTORY OPERATION AND THAT THE COATING WAS NOT A DETERMINING FACTOR AS TO THEIR SUITABILITY FOR USE IN CERTAIN ADDRESSING MACHINES. IT, THEREFORE, BECAME APPARENT THAT THERE EXISTED NO PROPER BASIS FOR THE MAKING OF SEPARATE AWARDS FOR ORGANIC COATED, TIN COATED, AND ZINC COATED STEEL ADDRESSING MACHINE PLATES, SINCE PLATES COATED WITH EITHER ZINC, TIN, OR ORGANIC MATERIAL WOULD PERFORM SATISFACTORILY IF MANUFACTURED TO PROPER DIMENSIONS. THE GENERAL SERVICES ADMINISTRATION HAS, FOR SOME TIME, IN ACCORDANCE WITH RECOMMENDATIONS MADE BY OUR OFFICE, ENDEAVORED TO CURTAIL THE USE OF MULTIPLE AWARDS WHEREVER POSSIBLE BECAUSE OF THE PROBABILITY THAT IN MOST INSTANCES THE RESULTING CONTRACTS WOULD BE LEGALLY UNENFORCEABLE EXCEPT TO THE EXTENT PERFORMED. WE HAVE CONSIDERED THAT A MULTIPLICITY OF AWARDS COVERING IDENTICAL OR SUBSTANTIALLY SIMILAR SUPPLIES TO BE FURNISHED TO MEET THE NEEDS OF THE GOVERNMENT WOULD ORDINARILY BE WHOLLY INCONSISTENT WITH ANY OBLIGATION OF THE GOVERNMENT TO ANY INDIVIDUAL CONTRACTOR. WITH RESPECT TO THE SUBJECT OF MUTUALITY AND ENFORCEABILITY OF CONTRACTS TO FURNISH THE NEEDS, DESIRES, WANTS, AND THE LIKE, OF ANOTHER, SEE 26 A.L.R. 2D 1139, 1141, 1142; WILLARD, SUTHERLAND AND CO. V. UNITED STATES, 262 U.S. 489; AND ATWATER AND COMPANY V. UNITED STATES, 262 U.S. 495.

THE GENERAL SERVICES ADMINISTRATION HAS REFERRED TO ITS STATUTORY AUTHORITY TO READVERTISE FOR BIDS WHEN DETERMINED TO BE IN THE PUBLIC INTEREST TO DO SO (41 U.S.C. 253), AND TO ITS STATUTORY AUTHORITY TO NEGOTIATE CONTRACTS WHERE THE PUBLIC EXIGENCY WILL NOT PERMIT OF THE DELAY INCIDENT TO ADVERTISING OR WHERE IT IS IMPRACTICABLE TO SECURE COMPETITION, 41 U.S.C. 252 (C) (2) AND (9). WE BELIEVE THAT THE GENERAL SERVICES ADMINISTRATION DID NOT EXCEED ITS AUTHORITY WHEN IT DETERMINED THAT READVERTISEMENT WAS NECESSARY AND THAT IT SHOULD ATTEMPT TO OBTAIN AN EXTENSION OF THE FISCAL YEAR 1958 CONTRACTS TO PROVIDE A SUFFICIENT TIME FOR A PROPER READVERTISEMENT OF THE GOVERNMENT'S REQUIREMENTS FOR ADDRESSING MACHINE PLATES DURING THE BALANCE OF THE FISCAL YEAR 1959. IS REPORTED THAT THE AMERICAN EXPANSION BOLT AND MANUFACTURING COMPANY DID NOT SUBMIT A BID IN RESPONSE TO THE SUBSEQUENT ADVERTISEMENT. THUS, IT IS APPARENT THAT THE AMERICAN EXPANSION BOLT AND MANUFACTURING COMPANY DID NOT, IN FACT, TAKE ADVANTAGE OF YOUR PREVIOUSLY DISCLOSED BID PRICES. ANY EVENT, AN OSTENSIBLE LOW BIDDER HAS NO PROPER COMPLAINT WHERE, AS HERE, A CONTRACTING AGENCY OF THE GOVERNMENT DETERMINES FOR VALID REASONS THAT THE PUBLIC INTEREST REQUIRED READVERTISING FOR BIDS.

ACCORDINGLY, NO FURTHER ACTION ON YOUR PROTEST BY OUR OFFICE APPEARS TO BE REQUIRED AND THE MATTER IS CONSIDERED CLOSED.