B-143590, SEP. 14, 1960

B-143590: Sep 14, 1960

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TO UNITED STATES SAFETY SERVICE CO.: FURTHER REFERENCE IS MADE TO LETTER DATED JULY 20. A COPY OF WHICH WAS FORWARDED TO THIS OFFICE. THE CONTRACTING OFFICER CONCLUDED THAT YOUR BID WAS NON RESPONSIVE AND. OBVIOUSLY ON THE PREMISE THAT SUCH ACTION WAS IN ACCORD WITH GOVERNING LAWS AND REGULATIONS AND IN THE BEST INTEREST OF THE GOVERNMENT'S COMPETITIVE BID SYSTEM. IT IS THE CONTENTION OF YOUR ATTORNEY THAT SINCE THE INVITATION FOR BIDS DID NOT PROVIDE THAT BIDS MIGHT BE SUBMITTED ON EITHER THE BASIS OF F.O.B. SINCE THERE WAS NO STATEMENT IN THE INVITATION INDICATING THAT BIDS SUBMITTED ON A BASIS OTHER THAN F.O.B. THE ACTION OF THE CONTRACTING OFFICER IN REJECTING YOUR PROPOSAL WAS ERRONEOUS.

B-143590, SEP. 14, 1960

TO UNITED STATES SAFETY SERVICE CO.:

FURTHER REFERENCE IS MADE TO LETTER DATED JULY 20, 1960, ADDRESSED TO THE CONTRACTING OFFICER, U.S. ARMY CHEMICAL PROCUREMENT DISTRICT, NEW YORK, BY YOUR ATTORNEY, A COPY OF WHICH WAS FORWARDED TO THIS OFFICE, PROTESTING THE REJECTION OF YOUR PROPOSAL UNDER IFB CML 30-070 60-152, ISSUED MAY 26, 1960.

AN EXAMINATION OF THE RECORD NOW BEFORE THIS OFFICE INDICATES THAT THE ABOVE-MENTIONED INVITATION FOR BIDS REQUIRED ALL BIDDERS TO OFFER THE GOVERNMENT A PRICE F.O.B. DESTINATION, BUT THAT THE BID SUBMITTED BY YOUR COMPANY OFFERED TO DELIVER THE ITEM F.O.B. ORIGIN. IN VIEW THEREOF, THE CONTRACTING OFFICER CONCLUDED THAT YOUR BID WAS NON RESPONSIVE AND, ACCORDINGLY AWARDED THE CONTRACT TO THE NEXT LOW BIDDER, OBVIOUSLY ON THE PREMISE THAT SUCH ACTION WAS IN ACCORD WITH GOVERNING LAWS AND REGULATIONS AND IN THE BEST INTEREST OF THE GOVERNMENT'S COMPETITIVE BID SYSTEM.

IT IS THE CONTENTION OF YOUR ATTORNEY THAT SINCE THE INVITATION FOR BIDS DID NOT PROVIDE THAT BIDS MIGHT BE SUBMITTED ON EITHER THE BASIS OF F.O.B. ORIGIN OR F.O.B. DESTINATION, OR BOTH, AND SINCE THERE WAS NO STATEMENT IN THE INVITATION INDICATING THAT BIDS SUBMITTED ON A BASIS OTHER THAN F.O.B. DESTINATION WOULD BE REJECTED AS NON RESPONSIVE, BOTH AS REQUIRED UNDER ASPR 1-306.5 (A) AND 1-306.5 (B), THE ACTION OF THE CONTRACTING OFFICER IN REJECTING YOUR PROPOSAL WAS ERRONEOUS. IT IS FURTHER CONTENDED THAT THE CONTRACTING OFFICER SHOULD HAVE PERMITTED THE BID TO BE MODIFIED OR AMENDED SO AS MORE CLEARLY TO REFLECT THE INTENDED BID, WITH AN ADVANTAGEOUS RESULT TO THE GOVERNMENT AND WITHOUT PREJUDICE TO THE OTHER BIDDER.

YOU ARE ADVISED THAT THE REGULATORY PROVISIONS ABOVE REFERRED TO WERE FIRST INCORPORATED INTO THE REGULATIONS BY REVISION NO. 52, DATED MARCH 15, 1960, WITH THE PROVISO THAT SUCH LANGUAGE BECOME EFFECTIVE ON JULY 1, 1960. THEREFORE, THE OMISSION OF SUCH REQUIREMENTS IN THE SUBJECT INVITATION WAS NOT CONTRARY TO THE ARMED SERVICES PROCUREMENT REGULATION AS IN EFFECT AT THE TIME OF THE INVITATION AND AWARD IN THIS CASE. FURTHERMORE, IN A DECISION DATED MARCH 10, 1958, B-134704, WE STATED, IN PERTINENT PART, AS FOLLOWS:

"WE ARE OF THE OPINION THAT WHEN THE GOVERNMENT REQUESTS F.O.B. DESTINATION BIDS FOR DELIVERIES OF SUPPLIES, WITHOUT ADVISING BIDDERS THAT F.O.B. ORIGIN BIDS WOULD ALSO BE CONSIDERED, THERE IS ORDINARILY AN IMPLIED OBLIGATION TO REJECT ANY BID WHICH FAILS TO QUOTE F.O.B. DESTINATION PRICES. THE CONTRACT AWARDED TO THE SUCCESSFUL BIDDER MUST BE THE CONTRACT WHICH WAS SUBMITTED TO COMPETITION.'

WE ALSO CONSISTENTLY HAVE HELD THAT A DEVIATION FROM ADVERTISED REQUIREMENTS IS MATERIAL IF IT AFFECTS EITHER THE PRICE, QUANTITY OR QUALITY OF THE ARTICLES OFFERED. 30 COMP. GEN. 179; 31 ID. 660; 33ID. 421. WE LIKEWISE HAVE HELD THAT THE WITHDRAWAL OR WAIVER BY A BIDDER OF MATERIAL DEVIATIONS FROM ADVERTISED SPECIFICATIONS, AFTER THE OPENING OF BIDS, IS NOT PERMISSIBLE AS SUCH ACTION WOULD BE PREJUDICIAL TO THE RIGHTS OF OTHER BIDDERS. THE INCLUSION IN YOUR BID -- AS CONFIRMED IN YOUR LETTER OF JULY 6, 1960, AND THAT FROM YOUR ATTORNEY DATED JULY 20, 1960--- OF THE STIPULATION IN QUESTION OBVIOUSLY WOULD HAVE THE EFFECT OF VARYING YOUR OBLIGATION FROM THAT CONTEMPLATED BY THE INVITATION WITH RESPECT TO DELIVERY OF THE MATERIALS TO DESTINATION. ONCE YOUR BID WAS ACCEPTED, AS SO QUALIFIED, YOU COULD SATISFY THE DELIVERY REQUIREMENTS BY MERELY GIVING THE MATERIAL TO A COMMON CARRIER IN KANSAS CITY, THUS RELIEVING YOUR COMPANY OF ANY FURTHER LIABILITY FOR LOSS OR DAMAGE ENROUTE, AND AT THE SAME TIME PLACE UPON THE GOVERNMENT, AMONG OTHER THINGS, THE BURDEN AND EXPENSE OF ALL ACTIVITY INCIDENT TO THE DETERMINATION OF RESPONSIBILITY FOR SUCH POTENTIAL LOSS OR DAMAGE IN TRANSIT. CONSIDERING THESE AND OTHER FACTORS, IT BECOMES APPARENT THAT THE CHANGE IN THE CONTRACT TERMS PROPOSED BY YOUR COMPANY IN THE PRESENT MATTER COULD WELL AFFECT THE CONTRACT PRICE.

IN THE LIGHT OF THE FOREGOING, THEREFORE, WE PERCEIVE NO LEGAL BASIS ON WHICH THIS OFFICE MAY QUESTION THE ADMINISTRATIVE ACTION TAKEN IN THE MATTER.