B-141253, FEB. 2, 1960

B-141253: Feb 2, 1960

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LIETZ COMPANY: REFERENCE IS MADE TO YOUR LETTER DATED NOVEMBER 12. WAS THE LOWEST RECEIVED FOR THESE ITEMS. YOU WERE AWARDED UNNUMBERED CONTRACT DATED JUNE 30. UPON DELIVERY OF THE TWO LEVELS UNDER ITEMS 2 AND 3 IT WAS FOUND THAT THE LEVELS FAILED TO MEET THE SPECIFICATIONS. THEY WERE REJECTED. YOU WERE REQUESTED TO MAKE REPLACEMENT WITH INSTRUMENTS COMPLYING WITH THE SPECIFICATIONS. WERE DECLARED IN DEFAULT AS TO THESE ITEMS UNDER THE PROVISIONS OF PARAGRAPH 11. THE LEVELS WERE RETURNED TO YOU AND THE PURCHASE ORDER AS RELATING THERETO WAS CANCELED. TWO LEVELS MEETING THE SPECIFICATIONS WERE PURCHASED AT A TOTAL PRICE OF $1. THAT AMOUNT WAS DEDUCTED FROM THE PAYMENT DUE YOU FOR THE OTHER ITEMS DELIVERED UNDER THE CONTRACT.

B-141253, FEB. 2, 1960

TO THE A. LIETZ COMPANY:

REFERENCE IS MADE TO YOUR LETTER DATED NOVEMBER 12, 1959, AND ENCLOSURES, PROTESTING THE ACTION OF THE DEPARTMENT OF AGRICULTURE, SOIL CONSERVATION SERVICE, IN DEDUCTING DAMAGES FOR YOUR FAILURE TO DELIVER CERTAIN LEVELS PURSUANT TO PURCHASE ORDER NO. 1959-MS-SCS-59, DATED JUNE 30, 1959.

THE RECORD BEFORE US DISCLOSES THAT THE DEPARTMENT OF AGRICULTURE, SOIL CONSERVATION SERVICE, BY INVITATION NO. SCS-44-MS-59, ISSUED JUNE 11, 1959, REQUESTED BIDS FOR THE FURNISHING OF CERTAIN ENGINEERING EQUIPMENT, INCLUDING ITEMS 2 AND 3, CONSISTING OF AUTOMATIC SELF LEVELING TYPE LEVELS, IN ACCORDANCE WITH THE ATTACHED SPECIFICATIONS FOR PRECISE LEVEL,AUTOMATIC LEVELING TYPE NI2. YOUR BID OF $926 FOR ITEMS 2 AND 3, WAS THE LOWEST RECEIVED FOR THESE ITEMS. YOU WERE AWARDED UNNUMBERED CONTRACT DATED JUNE 30, 1959, FOR THE FURNISHING OF THESE AND OTHER ITEMS, IN THE TOTAL AMOUNT OF $1,333.22.

UPON DELIVERY OF THE TWO LEVELS UNDER ITEMS 2 AND 3 IT WAS FOUND THAT THE LEVELS FAILED TO MEET THE SPECIFICATIONS, HAVING TELESCOPES OF ONLY 24 POWER, RATHER THAN 30 TO 40 POWER SPECIFIED. BECAUSE OF THE NEED FOR INSTRUMENTS WITH TELESCOPE OF NOT LESS THAN 30 POWER, AND FOR THE REASON THE LEVELS DELIVERED FAILED TO MEET THIS SPECIFIED REQUIREMENT, THEY WERE REJECTED. YOU WERE REQUESTED TO MAKE REPLACEMENT WITH INSTRUMENTS COMPLYING WITH THE SPECIFICATIONS. YOU, BEING UNABLE TO FURNISH LEVELS UNDER ITEMS 2 AND 3 COMPLYING WITH SPECIFICATIONS, WERE DECLARED IN DEFAULT AS TO THESE ITEMS UNDER THE PROVISIONS OF PARAGRAPH 11, OF THE GENERAL PROVISIONS OF THE CONTRACT.

THE LEVELS WERE RETURNED TO YOU AND THE PURCHASE ORDER AS RELATING THERETO WAS CANCELED. TWO LEVELS MEETING THE SPECIFICATIONS WERE PURCHASED AT A TOTAL PRICE OF $1,270 FROM THE NEELY BLUE PRINT AND SUPPLY COMPANY, ONE OF THE TWO SECOND LOW BIDDERS UNDER THE INVITATION INVOLVED. AS THIS PURCHASE RESULTED IN AN EXCESS COST OF $344 TO THE GOVERNMENT, THAT AMOUNT WAS DEDUCTED FROM THE PAYMENT DUE YOU FOR THE OTHER ITEMS DELIVERED UNDER THE CONTRACT.

THE REASONS WHY YOU BELIEVE THAT YOU SHOULD NOT BE CHARGED WITH THE EXCESS COSTS INVOLVED, AS EXPRESSED IN YOUR LETTER OF NOVEMBER 12, 1959, AND OUR VIEWS ON EACH ARE AS FOLLOWS:

"/1) THE SPECIFICATIONS AS INTERPRETED BY THE SOIL CONSERVATION SERVICE AT JACKSON, MISSISSIPPI, MUST BE INTERPRETED AS RESTRICTIVE AND PROPRIETARY.'

WE CANNOT CONCLUDE, IN THE ABSENCE OF ANY OTHER EVIDENCE, THAT THE SPECIFICATIONS ARE RESTRICTIVE AND PROPRIETARY. COMPETITION WAS ON AN EQUAL BASIS AND ON COMMON GROUND; THE LEVELS WERE COVERED BY DETAILED SPECIFICATIONS WITH WHICH ANY RELIABLE MANUFACTURER OR DEALER COULD COMPLY; AND THE SPECIFICATIONS WERE CLEARLY DRAWN SO AS TO ASSURE EQUIPMENT SUCH AS WOULD REASONABLY SERVE THE NEEDS OF THE SERVICE. THE PROVISIONS INCLUDED IN THE INSTRUCTION TO BIDDERS WERE INTENDED TO PLACE THE RESPONSIBILITY ON THE SELLER TO FURNISH EQUIPMENT COMPLYING WITH SPECIFICATIONS.

"/2) WE HAVE CLEARLY INDICATED IN OUR BID THE MAKE AND MODEL OF THE INSTRUMENT ON WHICH WE WERE QUOTING AND SENT ALONG DESCRIPTIVE LITERATURE WHICH CLEARLY SHOWS: "FILOTECNICA" AS THE E.'

YOUR ALLEGATION WITH RESPECT TO SHOWING THE MAKE AND MODEL OF THE INSTRUMENTS ON YOUR INVITATION IS TRUE; HOWEVER, THERE WAS NO DESCRIPTIVE LITERATURE TRANSMITTED WITH YOUR INVITATION AS YOU CONTEND. (THE DESCRIPTIVE LITERATURE WAS TRANSMITTED WITH THE LEVELS.) IRRESPECTIVE OF WHETHER DESCRIPTIVE LITERATURE HAD BEEN FURNISHED WITH THE BID, IT WAS STATED, UNDER "INSTRUCTION TO BIDDERS" ACCOMPANYING THE INVITATION FOR BIDS, AND INCLUDED AS PART OF THE CONTRACT, AS OLLOWS:

"DESCRIPTIVE LITERATURE: NOTWITHSTANDING A VARIATION BETWEEN THE SPECIFICATIONS AND ANY MAKE, MODEL OR CATALOGUE REFERENCE, OR ANY CUTS, DRAWINGS OR OTHER DESCRIPTIVE LITERATURE SUBMITTED, THE SPECIFICATIONS IN THE INVITATION SHALL BE CONTROLLING, AND SUCCESSFUL BIDDERS WILL BE REQUIRED TO DELIVER ARTICLES COMPLYING WITH THE INVITATION.'

THERE WAS NO EVIDENCE SUBMITTED WHICH CLEARLY PUT THE CONTRACTING OFFICER ON NOTICE THAT THE BID WAS INTENDED AS AN ALTERNATE QUOTATION. IN THE ABSENCE OF SUCH EVIDENCE, WE MUST HOLD YOU TO THE BID PRICE STATED FOR THE ITEM SPECIFIED AS INTENDED BY THE INVITATION.

"/3) WE HAVE BEEN IN BUSINESS SINCE 1882 AND ARE CONSTANTLY AND ALMOST DAILY QUOTING THE GOVERNMENT AND MANY OTHER AGENCIES AND HAVE NEVER BEEN CONFRONTED WITH A SIMILAR SITUATION, AND, AS PREVIOUSLY STATED, IN MANY CASES THE INSTRUMENT WE ARE OFFERING HERE HAS BEEN ACCEPTED AND FOUND ENTIRELY SATISFACTORY AND LATER ADDITIONAL INSTRUMENTS WERE PURCHASED.'

OBVIOUSLY, WE CANNOT COMMENT ON THE PROPRIETY OF ACTION TAKEN IN OTHER PROCUREMENTS WITHOUT KNOWLEDGE OF THE CIRCUMSTANCES.

"/4) IS IT NOT TO THE INTEREST OF OUR GOVERNMENT TO CONSIDER AND RECEIVE QUOTATIONS ON MORE THAN ONE MAKE OF INSTRUMENT? IF, THEN, IN THE OPINION OF THE GOVERNMENT, THE INSTRUMENT OFFERED DOES NOT MEET WITH THEIR APPROVAL, THE BID SHOULD BE REJECTED OR IGNORED. THIS IS EXACTLY WHAT TAKES PLACE CONSTANTLY ON THE MANY BIDS AND QUOTATIONS WHICH ARE BEING OFFERED TO THE GOVERNMENT BY MANY DIFFERENT FIRMS.'

WE AGREE THAT IT IS IN THE BEST INTEREST OF THE GOVERNMENT TO CONSIDER AND RECEIVE QUOTATIONS ON MORE THAN ONE MAKE INSTRUMENT. HOWEVER, A BIDDER CANNOT OFFER TO FURNISH EQUIPMENT SOMEWHAT APPROXIMATING THAT SPECIFIED IN THE INVITATION AND EXPECT THE GOVERNMENT TO ACCEPT OR CONSIDER THE EQUIPMENT AS MEETING THE REQUIREMENT. IT IS INCUMBENT UPON THE PURCHASING AGENCY TO WRITE SPECIFICATIONS MEETING ITS NEEDS. IF THE EQUIPMENT OFFERED DOES NOT MEET THE SPECIFICATIONS, IT IS THE DUTY OF THE PURCHASING AGENT TO REJECT THE BID AS NONRESPONSIVE.

"/5) ISN-T IT FAIR TO ASSUME THAT A CERTAIN RESPONSIBILITY RESTS WITH THE GOVERNMENT NOT TO MAKE THE AWARD, IF THE INSTRUMENT OFFERED WAS NOT SATISFACTORY WHEN WE, THE BIDDER, HAVE CAREFULLY POINTED OUT, WRITTEN INTO THE BID, AND FURNISHED LITERATURE ON EXACTLY WHAT WE ARE OFFERING?

IT IS A RULE OF LONG STANDING THAT AWARDS ARE NOT AUTHORIZED BY GOVERNMENT CONTRACTING OFFICERS WHEN IT IS KNOWN TO THEM THAT THE MATERIAL OR EQUIPMENT OFFERED DOES NOT MEET THE SPECIFICATIONS. HOWEVER, IN THIS INSTANCE, THERE WAS NO DATA SUPPLIED WHICH REASONABLY COULD BE EXPECTED TO PUT THE CONTRACTING OFFICER ON NOTICE THAT THE EQUIPMENT INVOLVED WAS OTHER THAN AS SPECIFIED. THUS, THE CONTRACTING OFFICER WAS WITHIN HIS RIGHT TO EXPECT THAT DELIVERY OF THE LEVELS, AFTER THE AWARD, WAS TO BE IN ACCORDANCE WITH THE SPECIFICATIONS.

"/6) THE ADVANTAGE TO THE GOVERNMENT OF RECEIVING COMPETITIVE BIDS MUST BE RECOGNIZED, AND AS WE MADE A SINCERE EFFORT TO OFFER A SATISFACTORY ARTICLE, WHICH EXPERIENCE HAS SHOWN WOULD DO THE WORK REQUIRED, WE FEEL THAT WE SHOULD NOT BE MADE TO SUFFER A PENALTY.'

IT APPEARS FROM THE RECORD THAT YOU DID NOT INTEND TO SUPPLY AN ITEM MEETING THE SPECIFICATIONS. FURTHER, ANY KNOWLEDGE THAT THIS WAS AN ALTERNATE BID, AS APPARENTLY YOU CONTEND, WAS NOT MADE KNOWN TO THE CONTRACTING OFFICER.

"/7) OUR QUOTATION HAS NOT RESULTED IN THE GOVERNMENT HAVING TO PAY MORE FOR THE INSTRUMENT OF THEIR CHOICE.'

THE SERVICE ACQUIRED TWO LEVELS CONFORMING TO SPECIFICATIONS AT A COST OF $1,270 AS COMPARED TO YOUR BID OF $926. THUS, THE INCREASE IN COST TO THE GOVERNMENT HAS BEEN ASSESSED AS DAMAGES AGAINST YOU PURSUANT TO THE PROVISIONS OF THE CONTRACT.

"/8) UNDER ITEM 1 ON THIS BID CALLING FOR TRANSIT, THE BID STATES;

"IN THE EVENT THE ANSWER TO THE QUESTIONNAIRE SHOWS THAT THE TRANSIT OFFERED DOES NOT MEET THE SPECIFICATIONS, THE BID WILL BE REJECTED.' UNDER ITEMS 2 AND 3 THERE WAS NO QUESTION THERE. WE CLEARLY INDICATED BY CIRCULARS AND CATALOG NUMBERS WRITTEN INTO THE BID WHAT WE WERE OFFERING. THIS SHOULD SERVE THE SAME PURPOSE AND THE BID SHOULD HAVE BEEN REJECTED.'

WE DO NOT THINK ANY COMMENTS ARE NECESSARY ON THIS ITEM IN VIEW OF THE FACT THAT THE QUESTION APPEARS REPETITIVE AND HAS BEEN SUBSTANTIALLY ANSWERED ABOVE.

UNDER THE CIRCUMSTANCES, THE ACCEPTANCE OF YOUR OFFER WAS MADE IN GOOD FAITH. SUCH ACTION CONSUMMATED A VALID AND BINDING CONTRACT WHICH FIXED THE RIGHTS AND OBLIGATIONS OF THE PARTIES. SEE UNITED STATES V. PURCELL ENVELOPE COMPANY, 249 U.S. 313; AND AMERICAN SMELTING AND REFINING COMPANY V. UNITED STATES, 259 U.S. 75. UNDER PARAGRAPH 11 (B) OF THE GENERAL PROVISIONS OF THAT CONTRACT YOU AGREED THAT, IN THE EVENT OF YOUR DEFAULT, YOU WOULD BE LIABLE FOR ANY EXCESS COSTS INCURRED BY THE GOVERNMENT IN PROCURING THE SUPPLIES ELSEWHERE.

ACCORDINGLY, YOU ARE ADVISED THAT WE SEE NO REASON TO QUESTION THE ADMINISTRATIVE ACTION TAKEN IN THIS INSTANCE.