B-144880, FEB. 14, 1961

B-144880: Feb 14, 1961

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STAN MOSS WAS THE HIGH BIDDER ON ITEMS 67 AND 68 IN THE RESPECTIVE AMOUNTS OF $889.38 AND $868.89. MOSS FAILED TO PERFORM HE WAS HELD IN DEFAULT AND CONSIDERED TO BE LIABLE FOR LIQUIDATED DAMAGES IN THE AMOUNT OF $351.65. DEMAND FOR WHICH AMOUNT WAS MADE UPON HIM BY THE DEPARTMENT OF THE NAVY AND BY THE CLAIMS DIVISION OF THIS OFFICE. IT WAS HELD. IS FOR THE PURPOSE OF MAINTAINING THE INTEGRITY OF THE COMPETITIVE BIDDING SYSTEM AND IS PRIMARILY FOR THE BENEFIT OF THE GOVERNMENT. IT IS WELL ESTABLISHED THAT THE FAILURE TO COMPLY WITH A REQUIREMENT WHICH IS FOR THE BENEFIT OF THE GOVERNMENT RATHER THAN FOR THE INDIVIDUAL CONTRACTING WITH THE GOVERNMENT DOES NOT RENDER A CONTRACT NOT COMPLYING WITH SUCH A REQUIREMENT UNENFORCEABLE AGAINST THE CONTRACTOR.

B-144880, FEB. 14, 1961

TO I. H. WACHTEL, ESQUIRE:

YOUR LETTER OF DECEMBER 23, 1960, WRITTEN IN BEHALF OF MR. STAN MOSS OF MIAMI, FLORIDA, REQUESTS A RULING ON THE VALIDITY OF CONTRACT NO. B228S- 43756, WITH THE DEPARTMENT OF THE NAVY.

ON DECEMBER 21, 1959, THE NAVAL SUPPLY CENTER, OAKLAND, CALIFORNIA, ISSUED SALES INVITATION NO. B-110-60-228, SOLICITING BIDS ON GOVERNMENT- OWNED MARINE EQUIPMENT AND MATERIALS. THE INVITATION PROVIDED THAT A BID DEPOSIT OF TWENTY PERCENT OF THE TOTAL AMOUNT BID MUST ACCOMPANY THE BID, AND THAT IF AFTER AWARD THE PURCHASER DEFAULTED HE WOULD BE LIABLE TO THE GOVERNMENT FOR LIQUIDATED DAMAGES IN AN AMOUNT EQUAL TO TWENTY PERCENT OF THE PURCHASE PRICE.

STAN MOSS WAS THE HIGH BIDDER ON ITEMS 67 AND 68 IN THE RESPECTIVE AMOUNTS OF $889.38 AND $868.89, A TOTAL OF $1,758.27, BUT HE FAILED TO SUBMIT A BID DEPOSIT. HOWEVER, THE CONTRACTING OFFICER WAIVED THIS DEFICIENCY AND MADE THE AWARD TO MR. MOSS FOR ITEMS 67 AND 68. WHEN MR. MOSS FAILED TO PERFORM HE WAS HELD IN DEFAULT AND CONSIDERED TO BE LIABLE FOR LIQUIDATED DAMAGES IN THE AMOUNT OF $351.65, DEMAND FOR WHICH AMOUNT WAS MADE UPON HIM BY THE DEPARTMENT OF THE NAVY AND BY THE CLAIMS DIVISION OF THIS OFFICE.

IN B-137319, DATED FEBRUARY 5, 1959, 38 COMP. GEN. 532, CITED BY YOU IN YOUR LETTER, IT WAS HELD, FOR THE REASONS STATED THEREIN, THAT WITH RESPECT TO BIDS SUBMITTED UNDER INVITATIONS ISSUED MORE THAN 60 DAYS AFTER FEBRUARY 5, 1959, THE FAILURE OF A BIDDER TO SUBMIT WITH HIS BID THE NECESSARY BID BOND OR OTHER BID GUARANTEE WOULD REQUIRE REJECTION OF THE BID AS NONRESPONSIVE.

THE RULE SET FORTH IN OUR DECISION OF FEBRUARY 5, 1959, 38 COMP. GEN. 532, IS FOR THE PURPOSE OF MAINTAINING THE INTEGRITY OF THE COMPETITIVE BIDDING SYSTEM AND IS PRIMARILY FOR THE BENEFIT OF THE GOVERNMENT. IT IS WELL ESTABLISHED THAT THE FAILURE TO COMPLY WITH A REQUIREMENT WHICH IS FOR THE BENEFIT OF THE GOVERNMENT RATHER THAN FOR THE INDIVIDUAL CONTRACTING WITH THE GOVERNMENT DOES NOT RENDER A CONTRACT NOT COMPLYING WITH SUCH A REQUIREMENT UNENFORCEABLE AGAINST THE CONTRACTOR. SEE UNITED STATES V. N.Y. AND PORTO RICO STEAMSHIP CO., 239 U.S. 88, 93. SEE, ALSO, ADELHARDT CONSTRUCTION COMPANY V UNITED STATES, 123 CT.CL. 456.

WE MUST, THEREFORE, RENEW OUR REQUEST THAT MR. MOSS PROMPTLY LIQUIDATE HIS INDEBTEDNESS TO THE UNITED STATES IN THE AMOUNT OF $350.65.