B-141217, FEB. 5, 1960

B-141217, FEB. 5, 1960

TO GENERAL ELECTRIC COMPANY:

THE DEPARTMENT OF THE ARMY HAS FORWARDED FOR OUR CONSIDERATION YOUR PROTEST AGAINST THE AWARD OF CONTRACTS AT THE WILLIAM BEAUMONT ARMY HOSPITAL, EL PASO, TEXAS, UNDER INVITATION FOR BIDS NOS. MD-41-016-59 4, 5 AND 7.

THE THREE INVITATIONS REQUESTED BIDS ON X-RAY EQUIPMENT. EACH PROVIDED THAT BIDDERS WERE TO INDICATE THEIR PROPOSED DELIVERY OF THE EQUIPMENT IN RESPONSE TO--- "QUOTE SHIPPING DATE OF ITEM.' THE AWARD IN EACH INSTANCE WAS MADE TO THE LOWEST BIDDER OFFERING EQUIPMENT MEETING THE SPECIFICATION REQUIREMENTS.

GENERAL ELECTRIC COMPANY WAS NOT THE LOW RESPONSIVE BIDDER IN ANY INSTANCE AND MAKES NO CLAIM THAT IT SHOULD HAVE BEEN AWARDED ANY OF THE THREE CONTRACTS. HOWEVER, IT IS URGED THAT THE AWARDS ARE INVALID BECAUSE THE INVITATIONS FOR BIDS DID NOT PROVIDE FOR A SPECIFIC DELIVERY DATE IN ACCORDANCE WITH PARAGRAPH 2-201E OF ARMY PROCUREMENT PROCEDURE WHICH PROVIDES: "THE TIME FOR DELIVERY IS A MATERIAL REQUIREMENT OF A PROCUREMENT AND MUST BE CLEARLY SET FORTH IN THE INVITATION.'

AT THE OUTSET IT MAY BE STATED THAT ALL ARMY PURCHASING ACTIVITIES SHOULD COMPLY WITH THE REGULATIONS SET FORTH IN THE ARMED SERVICES PROCUREMENT REGULATION AND ARMY PROCUREMENT PROCEDURE. IN THIS CONNECTION, THE CHIEF, CONTRACTS BRANCH, PROCUREMENT DIVISION, OFFICE OF THE DEPUTY CHIEF OF STAFF FOR LOGISTICS, ADVISES THAT CORRECTIVE ACTION IS BEING TAKEN TO INSURE THAT, IN FUTURE INVITATION FOR BIDS, THE PURCHASING ACTIVITY CONCERNED USES DELIVERY PROVISIONS WHICH ARE IN EXACT COMPLIANCE WITH ARMY PROCUREMENT PROCEDURE 2-201E.

THE PURPOSE OF THE STATUTES REQUIRING CERTAIN PUBLIC CONTRACTS TO BE LET TO THE LOWEST RESPONSIBLE BIDDER AFTER ADVERTISING IS TO GIVE ALL PERSONS AN EQUAL OPPORTUNITY TO COMPETE FOR GOVERNMENT CONTRACTS, TO PREVENT UNJUST FAVORITISM, COLLUSION, OR FRAUD IN AWARDING GOVERNMENT CONTRACTS, AND TO SECURE FOR THE GOVERNMENT THE BENEFITS WHICH FLOW FROM FREE AND UNRESTRICTED COMPETITION. SEE UNITED STATES V. BROOKRIDGE FARM, 111 F.2D 461, AFFIRMING 27 F.SUPP. 209. IT CONSISTENTLY HAS BEEN HELD THAT IN ORDER FOR BIDDERS TO COMPETE ON EQUAL TERMS WHEN SUBMITTING BIDS IN RESPONSE TO AN ADVERTISEMENT FOR BIDS THE SPECIFICATIONS AND INVITATION MUST BE SUFFICIENTLY DEFINITE TO ENABLE THE PREPARATION AND EVALUATION OF BIDS ON A COMMON BASIS. CONTRACTS AWARDED UNDER SPECIFICATIONS AND INVITATIONS WHICH ARE NOT SO DRAWN AS TO PERMIT COMPETITION ON AN EQUAL BASIS ARE VOIDABLE. UNITED STATES V. BROOKRIDGE FARM, SUPRA.

THE REASONABLE INTERPRETATION OF THE DELIVERY REQUIREMENT UNDER THE INVITATIONS HERE INVOLVED IS THAT ANY REASONABLE OFFER BY BIDDERS AS TO TIME OF DELIVERY WOULD BE ACCEPTABLE BECAUSE TIME WAS NOT A MATERIAL SUBSTANTIVE REQUIREMENT VITAL TO THE PROCUREMENT. THIS INTERPRETATION OF THE INVITATION IS ALSO SUPPORTED BY THE TYPE OF EQUIPMENT COVERED BY THE INVITATIONS. FOR INSTANCE, UNDER IFB MD-41-016-59-4 ALL BIDDERS WERE REQUIRED TO OBTAIN THE EQUIPMENT (X-OMAT) FROM THE SAME SUPPLIER, EASTMAN KODAK COMPANY, THE SOLE MANUFACTURER, AND ALL BIDDERS WERE IDENTICALLY DEPENDENT UPON THE SAME SUPPLIER'S PRODUCTION SCHEDULE. IT IS REPORTED THAT THE EQUIPMENT IS NOT STOCKED BY ANY DISTRIBUTOR AND THAT THE MANUFACTURER MAINTAINS A PRACTICE OF FILLING ORDERS FROM ITS PRODUCTION SCHEDULES IN THE SAME SEQUENCE AS ORDERS ARE RECEIVED BY IT.

GENERAL ELECTRIC PROTESTS STRONGLY THE AWARD MADE TO GILBERT X-RAY COMPANY OF TEXAS, UNDER IFB MD-41-016-59-4 ON THE BASIS OF ITS RESPONSE TO THE DELIVERY REQUIREMENT--- "QUOTE SHIPPING DATE OF ITEM.' THE RESPONSIVE BIDS RECEIVED AND THE DELIVERY TIME OFFERED BY THE BIDDERS ARE AS FOLLOWS:

TABLE

BIDDER PRICE DELIVERY CRANFORD X-RAY COMPANY

HOUSTON, TEXAS $32,000 180 DAYS GENERAL ELECTRIC COMPANY

X-RAY DEPARTMENT

DALLAS, TEXAS 29,400 170 TO 210 DAYS SOUTHWESTERN SURGICAL SUPPLY

COMPANY

EL PASO, TEXAS 27,800 240 DAYS THE GILBERT X-RAY COMPANY

OF TEXAS

DALLAS, TEXAS 26,800 *

(*) "SHIPPING DATE WILL BE IN ACCORDANCE WITH THE SCHEDULE OF THE EASTMAN KODAK CO., MANUFACTURER OF THE KODAK X-OMAT. WE ARE AN AUTHORIZED X-OMAT DEALER.'

IT IS REPORTED THAT IMMEDIATELY AFTER THE OPENING OF THE BIDS, THE CONTRACTING OFFICER INQUIRED FROM THE GILBERT X-RAY COMPANY AS TO THE DELIVERY TIME IT HAD OBTAINED FROM EASTMAN KODAK COMPANY, AND WAS ADVISED IT WAS APPROXIMATELY 240 DAYS. THE CONTRACTING OFFICER DETERMINED THAT ALL BIDDERS WERE EQUALLY LIMITED AS TO THE AVAILABILITY OF THE EQUIPMENT TO BE SUPPLIED AND THE AWARD WAS MADE TO THE GILBERT X-RAY COMPANY ON JUNE 25, 1959. THE EQUIPMENT WAS ACTUALLY DELIVERED DURING THE FIRST WEEK OF OCTOBER 1959.

GENERAL ELECTRIC IN ITS OWN BID ON IFB MD-41-016-59-5 STATED, WITH RESPECT TO DELIVERY ME,"DELIVERY OF THIS EQUIPMENT IS DEPENDENT UPON AVAILABILITY OF THE PHILLIPS INTENSIFIER FROM THE NORTH AMERICAN PHILLIPS COMPANY, INC. THEY HAVE PROMISED DELIVERY WITHIN APPROXIMATELY SEVEN (7) MONTHS.'

IT IS OUR OPINION THAT THE INVITATIONS AFFORDED ALL BIDDERS AN OPPORTUNITY TO BID ON AN EQUAL BASIS. GENERAL ELECTRIC APPARENTLY WAS NOT MISLED BY THE DELIVERY REQUIREMENTS OF THE INVITATIONS AND MADE NO INQUIRY OR OBJECTION THERETO UNTIL AFTER THE OPENING OF THE BIDS. FURTHERMORE, IT IS NOT PERCEIVED HOW GENERAL ELECTRIC WAS UNFAIRLY TREATED, SINCE IT WOULD NOT HAVE BEEN THE LOWEST RESPONSIBLE BIDDER IN ANY INSTANCE REGARDLESS OF ANY MISUNDERSTANDING (AND NONE IS ALLEGED) WITH REFERENCE TO THE DELIVERY REQUIREMENTS.

IN THE CIRCUMSTANCES, EVEN THOUGH THE DELIVERY REQUIREMENTS OF THE INVITATIONS MAY NOT HAVE BEEN IN STRICT COMPLIANCE WITH THE PROVISIONS OF THE REGULATIONS, THE BIDDERS WERE GIVEN AN EQUAL OPPORTUNITY TO BID IN ACCORDANCE WITH THE BASIC REQUIREMENTS OF THE STATUTE (10 U.S.C. 2304), AND THEREFORE, WE FIND NO REASON TO QUESTION THE LEGALITY OF THE AWARD MADE.