B-139521, JUNE 25, 1959, 38 COMP. GEN. 876

B-139521: Jun 25, 1959

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IN VIEW OF THE DISTINCTION BETWEEN "MAILING" AND "RECEIPT" AND THE RULE THAT AN OFFER IS NOT ACCOMPLISHED UNTIL RECEIVED. A BID WHICH OFFERS DELIVERY WITHIN A STATED TIME "AFTER RECEIPT OF THE CONTRACT" DEVIATES FROM THE INVITATION IN A MATERIAL RESPECT EVEN THOUGH THE MAILING TIME IS INSIGNIFICANT WHEN COMPARED TO THE TIME FOR SCHEDULED DELIVERY. 1959: FURTHER REFERENCE IS MADE TO YOUR LETTER OF APRIL 27. WAS REJECTED BECAUSE YOU OFFERED DELIVERY WITHIN THE TIMES STATED IN THE FOREGOING CHART "AFTER RECEIPT OF CONTRACT" WHEREAS THE PROVISION OF THE INVITATION IS BASED ON DELIVERY WITHIN THE STATED TIMES "AFTER DATE OF CONTRACT.'. PRESENT SEVERAL REASONS FOR CONCLUDING THAT THE BID ON THE CITED ITEMS OF THE INVITATION WAS IMPROPERLY REJECTED.

B-139521, JUNE 25, 1959, 38 COMP. GEN. 876

BIDS - EVALUATION - DELIVERY PROVISIONS - MAILS AS AGENT OF BIDDER A DELIVERY SCHEDULE OFFERED IN TERMS OF A SPECIFIED TIME "AFTER RECEIPT OF CONTRACT" WHEN THE INVITATION REQUIRES DELIVERY WITHIN A SPECIFIED TIME "AFTER DATE OF CONTRACT" MAY NOT BE REGARDED AS IN COMPLIANCE WITH THE INVITATION, ON THE BASIS THAT THE MAILS MUST BE REGARDED AS THE AGENT OF THE BIDDER, IN VIEW OF THE DISTINCTION BETWEEN "MAILING" AND "RECEIPT" AND THE RULE THAT AN OFFER IS NOT ACCOMPLISHED UNTIL RECEIVED. UNDER AN INVITATION WHICH REQUIRES DELIVERY WITHIN A SPECIFIED TIME "AFTER DATE OF CONTRACT," TIME MUST BE REGARDED AS OF THE ESSENCE OF THE CONTRACT, AND A BID WHICH OFFERS DELIVERY WITHIN A STATED TIME "AFTER RECEIPT OF THE CONTRACT" DEVIATES FROM THE INVITATION IN A MATERIAL RESPECT EVEN THOUGH THE MAILING TIME IS INSIGNIFICANT WHEN COMPARED TO THE TIME FOR SCHEDULED DELIVERY; AND, THEREFORE, THE BID MUST BE REJECTED AS NONRESPONSIVE TO THE INVITATION.

TO THE KEARNEY AND TRECKER CORPORATION, JUNE 25, 1959:

FURTHER REFERENCE IS MADE TO YOUR LETTER OF APRIL 27, 1959, AND SUBSEQUENT CORRESPONDENCE PROTESTING THE REJECTION OF YOUR BID SUBMITTED IN RESPONSE TO INVITATION FOR BIDS NO. 156-271-59 ISSUED BY THE NAVAL AIR MATERIAL CENTER, PHILADELPHIA, PENNSYLVANIA, ON FEBRUARY 12, 1959.

THE INVITATION, WHICH SOLICITED BIDS FOR A VARIETY OF MACHINE TOOLS, INCLUDED, AS AMENDED, THE FOLLOWING PROVISION WITH REGARD TO TIME OF DELIVERY:

TIME OF DELIVERY: MACHINES SHALL BE DELIVERED WITHIN THE FOLLOWING NUMBER OF WEEKS AFTER DATE OF CONTRACT, BASED ON ASSIGNMENT OF THE URGENCY STANDINGS LISTED UNDER THE CLAUSE BELOW ENTITLED " IMS CERTIFICATION, D.O. RATING AND URGENCY STANDINGS," UNDER NPA REG. M41 TO ANY RESULTANT CONTRACT. ( ITALICS SUPPLIED.)

CHART ITEM 10 WEEKS 12 WEEKS 14 WEEKS 20 WEEKS 26 WEEKS 30 WEEKS 32 WEEKS

1 -------- 2 EA. ---------------- -------- -------- ------ -

2 -------- -------- 2 EA. -------- -------- -------- ---- ---

3 -------- -------- -------- -------- 8 EA. -------- ---- ---

4 -------- -------- -------- -------- -------- -------- 11EA.

5 -------- 1 EA. -------- -------- -------- -------- ---- ---

6 -------- -------- -------- -------- 8 EA. -------- ---- ---

7 -------- 1 EA. -------- -------- -------- -------- ------ -

8 -------- -------- -------- -------- -------- 10 EA. ------ -

9 1 EA. -------- -------- -------- -------- -------- ---- --- 10 1 EA. -- ------ -------- -------- -------- -------- -- ----- 11 -------- 1 EA. ---- ---- -------- -------- -------- -------- 12 -------- -------- -------- --- ----- -------- ------ - 2 EA. 13 -------- -------- -------- 6 EA. -------- ------- -------- 14

2 EA. -------- -------- -------- -------- -------- --------

ANY BID OFFERING DELIVERY AT VARIANCE WITH THE GOVERNMENT'S DELIVERY REQUIREMENTS SET FORTH ABOVE OR OFFERING DELIVERY CONTINGENT UPON THE AVAILABILITY OR RECEIPT OF MATERIAL SHALL BE CONSIDERED NONRESPONSIVE TO THE INVITATION AND SHALL BE REJECTED.

YOUR BID, ON ALL ITEMS EXCEPT NOS. 5 AND 8, WAS REJECTED BECAUSE YOU OFFERED DELIVERY WITHIN THE TIMES STATED IN THE FOREGOING CHART "AFTER RECEIPT OF CONTRACT" WHEREAS THE PROVISION OF THE INVITATION IS BASED ON DELIVERY WITHIN THE STATED TIMES "AFTER DATE OF CONTRACT.'

YOUR LETTER OF APRIL 27 AND A MEMORANDUM OF MAY 6 SUBMITTED WITH YOUR LETTER OF MAY 7, 1959, PRESENT SEVERAL REASONS FOR CONCLUDING THAT THE BID ON THE CITED ITEMS OF THE INVITATION WAS IMPROPERLY REJECTED. YOU FIRST CONTEND THAT THE TERMS "AFTER DATE OF CONTRACT" AND "AFTER RECEIPT OF CONTRACT" ARE SYNONYMOUS. YOU ARRIVE AT THIS CONCLUSION BECAUSE UNDER THE TERMS OF THE INVITATION, OF APPLICABLE REGULATIONS, AND OF GENERAL CONTRACT LAW AN AWARD WOULD BE EFFECTED BY MAILING A PROPERLY STAMPED AND ADDRESSED NOTIFICATION THEREOF TO THE SUCCESSFUL BIDDER. YOU STATE FURTHER THAT THE POST OFFICE IS MADE THE AGENT OF THE BIDDER TO RECEIVE AWARD ON HIS BEHALF. YOU CONCLUDE THEREFORE, SINCE THE MAILING OF THE AWARD BRINGS THE CONTRACT INTO EXISTENCE AND AT THE SAME TIME CONSTITUTES RECEIPT OF NOTICE BY THE SUCCESSFUL BIDDER THROUGH ITS AGENT, THE UNITED STATES MAILS, THAT THE DELIVERY SCHEDULE OFFERED IN YOUR BID DID NOT DIFFER FROM THE DELIVERY SCHEDULE REQUIRED BY THE INVITATION.

IT IS WELL RECOGNIZED THAT THE RECEIPT OF AN ITEM INVOLVES AN ACTUAL DELIVERY. SPRAGG V. PRUDENTIAL INSURANCE CO., 198 N.E. 585; BOWLES V. NELSON-RICKS CREAMERY, 66 F.1SUPP. 885; POSTAL TEL. CABLE CO. V. LOUISVILLE COTTON SEED OIL CO., 131 S.W. 277. THEREFORE, UNLESS IT CAN BE SAID, AS YOU CONTEND, THAT THE UNITED STATES MAILS MUST BE REGARDED AS THE AGENT OF THE BIDDER THERE APPEARS NO BASIS FOR REASONING THAT THE CONTRACT DATE, WHICH WE AGREE IS THE DATE ON WHICH THE NOTICE OF AWARD WAS DEPOSITED IN THE MAIL, CAN BE THE SAME AS THE DATE OF RECEIPT OF CONTRACT EXCEPT IN THOSE INSTANCES WHERE THE NOTIFICATION IS MAILED AND DELIVERED ON THE SAME DAY. AS TO WHETHER THE UNITED STATES MAILS, IN SITUATIONS SUCH AS HERE UNDER CONSIDERATION, MAY BE CONSIDERED AS THE BIDDER'S AGENT, THE FOLLOWING FROM 1 CORBIN ON CONTRACTS SECTION 78 (PAGES 246-247), APPEARS APPLICABLE:

THE REASON THAT IS MOST OFTEN GIVEN FOR THE RULE IS THAT THE OFFEROR, BY SENDING HIS OFFER BY MAIL, HAS MADE THE POST HIS AGENT TO RECEIVE AND CARRY THE ACCEPTANCE. SOMETIMES IT IS SAID THAT THE POST IS THE COMMON AGENT OF BOTH PARTIES. IT REQUIRES ONLY SLIGHT CONSIDERATION TO PERCEIVE THAT THIS REASONING IS DEFECTIVE. THE TERM "AGENT" IS GENERALLY USED TO REFER ONLY TO SOME HUMAN PERSON WITH POWER TO ACT ON HIS PRINCIPAL'S BEHALF. THE "POST" IS NOT A PERSON, ALTHOUGH THERE ARE MANY PERSONS IN THE POSTAL SERVICE; AND IT IS BY NO ACT OF ANY SUCH PERSON THAT THE MAKING OF THE CONTRACT IS CONSUMMATED. A LETTER BOX ON THE CORNER IS NEITHER A PERSON NOR AN AGENT; AND YET THE ACCEPTANCE IS EFFECTIVE WHEN THE LETTER OF ACCEPTANCE IS DROPPED INTO THAT BOX. IT IS THE OFFEREE HIMSELF (OR SOME PERSON AUTHORIZED BY HIM) WHO DROPS THE LETTER IN THE BOX. IT IS HE WHO HAS THE POWER AND WHO EXERCISES IT BY HIS ACTION. THE "BOX" HAS NO POWER AND DOES NOT ACT. IT IS TRUE THAT A POSTMAN MAY THEREAFTER REMOVE THE LETTER FROM THE BOX; BUT THE CONTRACT HAS ALREADY BEEN MADE AND THE REMOVAL HAS NO LEGAL OPERATION. ALL THIS IS EQUALLY TRUE IN CASE THE LETTER IS MAILED BY DROPPING IT THROUGH THE PROPER SLIT INSIDE OF A POST OFFICE BUILDING.

A BETTER EXPLANATION OF THE EXISTING RULE SEEMS TO BE THAT IN SUCH CASES THE MAILING OF A LETTER HAS LONG BEEN A CUSTOMARY AND EXPECTED WAY OF ACCEPTING THE OFFER. IT IS ORDINARY BUSINESS USAGE. MORE THAN THIS, HOWEVER, IS NEEDED TO EXPLAIN WHY THE LETTER IS OPERATIVE ON MAILING RATHER THAN ON RECEIPT BY THE OFFEROR. EVEN THOUGH IT IS BUSINESS USAGE TO SEND AN OFFER BY MAIL, IT CREATES NO POWER OF ACCEPTANCE UNTIL IT IS RECEIVED. INDEED, MOST NOTICES SENT BY MAIL ARE NOT OPERATIVE UNLESS ACTUALLY RECEIVED.

THE ADDITIONAL REASONS FOR HOLDING THAT A DIFFERENT RULE APPLIES TO AN ACCEPTANCE AND THAT IT IS OPERATIVE ON MAILING MAY BE SUGGESTED AS FOLLOWS: WHEN AN OFFER IS BY MAIL AND THE ACCEPTANCE ALSO IS BY MAIL, THE CONTRACT MUST DATE EITHER FROM THE MAILING OF THE ACCEPTANCE OR FROM ITS RECEIPT. IN EITHER CASE, ONE OF THE PARTIES WILL BE BOUND BY THE CONTRACT WITHOUT BEING ACTUALLY AWARD OF THAT FACT * * * ( ITALICS SUPPLIED.)

(YOUR ATTENTION IS ALSO INVITED TO THE ITALICIZED PROVISION ABOVE DISTINGUISHING BETWEEN MAILING AND RECEIPT.) ACCORDINGLY, WE CANNOT REGARD THE TWO TERMS AS SYNONYMOUS.

YOU NEXT CONTEND THAT IN YOUR EXPERIENCE MAIL IS DELIVERED IN MILWAUKEE, WHERE YOUR OFFICE IS LOCATED, WITHIN 1 OR 2 DAYS AFTER MAILING FROM PHILADELPHIA, THE LOCATION OF THE CONTRACTING OFFICE. SINCE THE MAILING TIME IS INSIGNIFICANT AS COMPARED TO THE SCHEDULE REQUIREMENT OF DELIVERIES WITHIN 10 TO 32 WEEKS YOU CONCLUDE THAT THE DIFFERENCE BETWEEN THE REQUIRED DELIVERY SCHEDULE AND THAT OFFERED IN YOUR BID SHOULD BE WAIVED BY THE CONTRACTING OFFICER AS A MINOR INFORMALITY ESPECIALLY IN VIEW OF THE MORE THAN $40,000 DIFFERENCE BETWEEN YOUR BID AND THAT OF THE NEXT HIGHER BIDDER. WHERE THE INVITATION ON ITS FACE REQUIRES DELIVERY WITHIN A STATED PERIOD, TIME MUST BE REGARDED AS OF THE ESSENCE OF THE CONTRACT EVEN IF THE INVITATION DOES NOT EXPRESSLY SO STATE. 36 COMP. GEN. 181. FAILURE OF A BID TO CONFORM TO THE REQUIRED DELIVERY SCHEDULE MUST BE REGARDED AS MATERIAL DEVIATION WHICH CANNOT BE WAIVED AND WHICH REQUIRES REJECTION OF SUCH BID. 34 COMP. GEN. 24.

YOU NEXT ALLEGE THAT THE USE OF THE TERM "AFTER RECEIPT OF CONTRACT" IN YOUR BID WAS AN ERROR WHICH SHOULD BE SUBJECT TO CORRECTION UNDER THE RULES GOVERNING MISTAKES IN BID. ERRORS IN BID WHICH MAY BE CORRECTED AFTER OPENING ARE THOSE WHICH DO NOT AFFECT THE RESPONSIVENESS OF THE BID. B-139132, MAY 14, 1959. SINCE YOUR BID, AS INDICATED ABOVE, IS NOT RESPONSIVE IN THE FORM SUBMITTED, IT MAY NOT BE CONSIDERED FOR CORRECTION.

FINALLY YOU INDICATE THAT YOU HAVE USED THE SAME LANGUAGE IN A NUMBER OF OTHER BIDS WITHOUT ANY ADVERSE EFFECT ON THEIR CONSIDERATION. ASSUMING THAT THE SEVERAL SITUATIONS ARE ANALOGOUS, THE FACT THAT BIDS SUBMITTED BY YOU PREVIOUSLY MAY HAVE BEEN ERRONEOUSLY ACCEPTED WOULD NOT REQUIRE THAT THE SAME ERRONEOUS PROCEDURE SHOULD BE FOLLOWED IN THIS CASE.

A BID OFFERING DELIVERY WITHIN A GIVEN TIME AFTER RECEIPT OF NOTICE OF AWARD, WHETHER EMPLOYING THAT PHRASE OR SOME OTHER PHRASE HAVING SUBSTANTIALLY THE SAME EFFECT, MAY NOT BE REGARDED AS RESPONSIVE TO AN INVITATION REQUIRING DELIVERY WITHIN THE STATED TIME AFTER DATE OF CONTRACT. SEE 38 COMP. GEN. 98.

FOR THE REASONS SET OUT ABOVE, WE MUST CONCLUDE THAT YOUR BID WAS PROPERLY REJECTED. THEREFORE, THERE IS NO NEED TO CONSIDER THE ARGUMENTS PRESENTED IN YOUR LETTER OF JUNE 15, 1959, AS TO WHETHER THE ARTICLES OFFERED BY YOU WERE IN CONFORMITY WITH THE SPECIFICATIONS.