B-144609, MAR. 7, 1961

B-144609, MAR. 7, 1961

TO BLANK, RUDENKO, KLAUS AND ROME:

REFERENCE IS MADE TO YOUR LETTER DATED DECEMBER 5, 1960, PROTESTING AGAINST THE ACTION OF THE DEPARTMENT OF THE ARMY IN FAILING TO AWARD CONTRACT NO. DA 33-181-ENG-1269, PROVIDING FOR TECHNICAL ASSISTANCE SERVICES IN THE PACIFIC AREA, TO THE M AND T COMPANY. IT IS YOUR CONTENTION THAT THE ACTION OF THE DEPARTMENT IN DECIDING THAT M AND T COMPANY WAS NOT A RESPONSIBLE BIDDER WAS ARBITRARY, CAPRICIOUS, UNTIMELY AND WITHOUT BASIS IN FACT. YOU THEREFORE REQUEST THAT THIS OFFICE TAKE SUCH STEPS AS MAY BE NECESSARY TO INSURE THAT THE M AND T COMPANY WILL NOT BE ARBITRARILY DENIED THE RIGHT TO RECEIVE GOVERNMENT CONTRACTS.

THE RECORDS OF THE DEPARTMENT OF THE ARMY IN THIS MATTER INDICATE THAT, PRIOR TO FISCAL YEAR 1961, TECHNICAL ASSISTANCE REQUIREMENTS WERE SUPPLIED TO THE DEPARTMENT UNDER SEVERAL CONTRACTS FOR PERFORMANCE WORLD-WIDE. ONE OF SUCH CONTRACTS, NO. DA 11-184-ENG 16404, WAS HELD BY THE M AND T COMPANY FROM JUNE 24, 1958, TO NOVEMBER 30, 1960. THE PRESENT PROCUREMENT, TO WHICH YOUR PROTEST IS DIRECTED, COVERED SERVICES DURING FISCAL YEAR 1961, DURING WHICH PERIOD IT WAS DETERMINED TO PLACE ALL SUCH REQUIREMENTS UNDER TWO CALL-TYPE REQUIREMENTS CONTRACTS, ONE SERVING THE EUROPEAN AREA AND A SECOND SERVING THE PACIFIC AREA. M AND T COMPANY SUBMITTED THE LOWEST PROPOSAL FOR SERVICES IN THE PACIFIC AREA. FOLLOWING NEGOTIATION AND A DETERMINATION, BASED UPON THE AVAILABLE RECORD, THAT M AND T COMPANY WAS A RESPONSIBLE BIDDER, CONTRACT NO. DA 33-181-ENG-1269 WAS EXECUTED BY BOTH THE CONTRACTING OFFICER AND BY M AND T COMPANY. HOWEVER, ARTICLE 33 OF THIS CONTRACT SPECIFICALLY PROVIDED THAT IT SHOULD NOT BECOME BINDING UNTIL APPROVED IN WRITING BY THE CHIEF OF ENGINEERS, AND THE CONTRACT WAS THEREFORE FORWARDED TO THE CHIEF OF ENGINEERS FOR SUCH APPROVAL. AS A RESULT OF REPLIES TO INQUIRIES MADE TO OVERSEAS COMMANDS CONCERNING PERFORMANCE UNDER CONTRACT NO. DA 11-184-ENG 16404, THAT OFFICIAL QUESTIONED THE CONTRACTING OFFICER'S DETERMINATION THAT M AND T COMPANY WAS A RESPONSIBLE BIDDER. IT WAS THEREFORE DECIDED TO OBTAIN ALL AVAILABLE DOCUMENTARY EVIDENCE FROM 7TH LOGISTICAL COMMAND AND UNITED STATES ARMY COMMAND, KOREA, RELATIVE TO PERFORMANCE BY M AND T COMPANY UNDER BOTH ENGINEER AND QUARTERMASTER CONTRACTS IN THE PACIFIC AREA. REPORTS RECEIVED PURSUANT TO SUCH REQUESTS INDICATED CONSISTENT UNDERSTAFFING IN TECHNICIAN POSITIONS CALLED FOR BY THE CONTRACTS AND REPEATED COMPLAINTS OF MISCONDUCT ON THE PART OF M AND T COMPANY EMPLOYEES. BASED THEREON, THE CONTRACTING OFFICER CONCLUDED HE WAS UNABLE TO PROPERLY MAKE THE AFFIRMATIVE DETERMINATION THAT M AND T COMPANY WAS A RESPONSIBLE BIDDER, AS REQUIRED BY ASPR 1-904.1.

WE HAVE BEEN ADVISED BY THE DEPARTMENT OF THE ARMY THAT THE REQUEST FOR PROPOSALS UNDER WHICH M AND T COMPANY SUBMITTED ITS OFFER HAS SINCE BEEN CANCELLED, AND THAT THE PROCUREMENT HAS BEEN ACCOMPLISHED BY EXTENDING VARIOUS CONTRACTS UNDER WHICH SERVICES WERE FURNISHED DURING FISCAL YEAR 1960. INSOFAR AS THE INSTANT PROCUREMENT IS CONCERNED, IT WOULD THEREFORE APPEAR THAT THE QUESTION PRESENTED TO THIS OFFICE IS NOW ACADEMIC, AND THAT IT IS IMMATERIAL WHETHER WE AGREE OR DISAGREE WITH THE REFUSAL OF THE DEPARTMENT OF THE ARMY TO FIND THAT M AND T COMPANY WAS A RESPONSIBLE BIDDER. HOWEVER, THE FOLLOWING GENERAL PRINCIPLES ARE STATED FOR YOUR INFORMATION.

WHETHER BIDDER'S PERFORMANCE IN THE PAST ON GOVERNMENT CONTRACTS WAS SUFFICIENTLY SATISFACTORY IN ALL MATERIAL RESPECTS TO MERIT CONTINUED CONFIDENCE IN HIS ABILITY TO SATISFACTORILY PERFORM FUTURE CONTRACTS IS A QUESTION WHICH MUST NECESSARILY BE DECIDED, IN THE FIRST INSTANCE, BY THE CONTRACTING AGENCY. SUCH DETERMINATION MAY PROPERLY INCLUDE CONSIDERATION OF THE JUDGMENT, SKILL AND INTEGRITY OF THE BIDDER, 26 COMP. GEN. 676, AND UNLESS DETERMINATIONS OF THIS NATURE ARE NOT BASED UPON COMPETENT EVIDENCE, OR ARE SO IN CONFLICT WITH SUCH EVIDENCE AS TO INDICATE BAD FAITH, THIS OFFICE WILL NOT SUBSTITUTE ITS JUDGMENT FOR THAT OF THE CONTRACTING AGENCY. 36 COMP. GEN. 2; 37 ID. 798.

OUR REVIEW OF THE RECORDS OF THE DEPARTMENT OF THE ARMY INDICATES THERE IS SUBSTANTIAL EVIDENCE TO SUPPORT THE CONTRACTING OFFICER'S FINDINGS OF UNDERSTAFFING AND MISCONDUCT OF COMPANY EMPLOYEES IN THE PERFORMANCE OF PRIOR CONTRACTS BY M AND T COMPANY. IN VIEW OF THE NATURE OF THE SERVICES REQUESTED IN THE INSTANT PROCUREMENT AND THE LOCATIONS AT WHICH

SUCH SERVICES WOULD BE RENDERED, WE ARE UNABLE TO DISAGREE WITH THE CONCLUSION OF THE DEPARTMENT THAT ASSURANCE OF FULL STAFFING BY EMPLOYEES OF UNQUESTIONED MORALITY AND INTEGRITY WERE PROPER FACTORS TO BE CONSIDERED IN DECIDING IF M AND T COMPANY SHOULD BE CONSIDERED A RESPONSIBLE BIDDER IN THIS PROCUREMENT. WE ARE THEREFORE UNABLE TO CONCLUDE THAT THE ARMY'S FAILURE TO DECLARE M AND T COMPANY A RESPONSIBLE BIDDER WAS NOT SUPPORTED BY SUBSTANTIAL EVIDENCE, OR THAT SUCH FAILURE CONSTITUTED AN ABUSE OF THE DISCRETION VESTED IN CONTRACTING AGENCIES IN THIS AREA.

CONCERNING THE SUGGESTION THAT THE EVIDENCE RELIED UPON IN THIS PROCUREMENT MAY ALSO BE RELIED UPON TO SUPPORT FINDINGS OF NONRESPONSIBILITY IN FUTURE PROCUREMENTS, WE MUST DECLINE TO COMMENT ON THE PROPRIETY OF SUCH HYPOTHETICAL POSSIBILITIES.