B-147461, DEC. 14, 1961

B-147461: Dec 14, 1961

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INC.: FURTHER REFERENCE IS MADE TO YOUR LETTER OF OCTOBER 20. BIDS WERE REQUESTED FOR THE FURNISHING OF INCREMENTAL QUANTITIES OF FUEL CELL SERVICING CARTS. NINETEEN BIDS WERE RECEIVED AND THE LOWEST BID WAS SUBMITTED BY YOUR FIRM. THE NEXT LOWEST BID WAS SUBMITTED BY MACHINERY TANK AND SUPPLY COMPANY. A CONTRACT WAS AWARDED TO THAT COMPANY FOR A QUANTITY OF 30 UNITS OF ITEM NO. 1 AND FOR THE FURNISHING OF THE TECHNICAL DATA AS DESCRIBED IN ITEM NO. 1A. YOUR BID WAS REJECTED AS NONRESPONSIVE TO THE INVITATION BECAUSE IT APPEARED TO HAVE IMPOSED A CONDITION WHICH WOULD HAVE MODIFIED THE REQUIREMENTS OF THE INVITATION IN A MATERIAL RESPECT. YOUR BID WAS ACCOMPANIED BY LETTER DATED JULY 20.

B-147461, DEC. 14, 1961

TO STEWART AVIONICS, INC.:

FURTHER REFERENCE IS MADE TO YOUR LETTER OF OCTOBER 20, 1961, PROTESTING THE AWARD OF A CONTRACT TO MACHINERY TANK AND SUPPLY COMPANY, INC., WICHITA, KANSAS, UNDER INVITATION FOR BIDS NO. 01-601 61-1789, ISSUED JUNE 8, 1961, BY HEADQUARTERS, MOBILE AIR MATERIEL AREA, UNITED STATES AIR FORCE, BROOKLEY AIR FORCE BASE, ALABAMA.

BIDS WERE REQUESTED FOR THE FURNISHING OF INCREMENTAL QUANTITIES OF FUEL CELL SERVICING CARTS, SPARE PARTS AND RELATED TECHNICAL DATA. NINETEEN BIDS WERE RECEIVED AND THE LOWEST BID WAS SUBMITTED BY YOUR FIRM. THE NEXT LOWEST BID WAS SUBMITTED BY MACHINERY TANK AND SUPPLY COMPANY, INC., AND A CONTRACT WAS AWARDED TO THAT COMPANY FOR A QUANTITY OF 30 UNITS OF ITEM NO. 1 AND FOR THE FURNISHING OF THE TECHNICAL DATA AS DESCRIBED IN ITEM NO. 1A. YOUR BID WAS REJECTED AS NONRESPONSIVE TO THE INVITATION BECAUSE IT APPEARED TO HAVE IMPOSED A CONDITION WHICH WOULD HAVE MODIFIED THE REQUIREMENTS OF THE INVITATION IN A MATERIAL RESPECT.

THE INVITATION PROVIDED GENERALLY THAT PROGRESS PAYMENTS WOULD NOT BE AVAILABLE BUT MADE AN EXCEPTION WITH RESPECT TO PROGRESS PAYMENTS WHICH MIGHT BE REQUESTED BY SMALL BUSINESS CONCERNS WHEN SUBMITTING BIDS. YOUR BID WAS ACCOMPANIED BY LETTER DATED JULY 20, 1961, REQUESTING THAT PROGRESS PAYMENTS BE MADE IF YOU WERE THE SUCCESSFUL BIDDER. THE LETTER WAS PREPARED ON COMPANY STATIONERY AT THE BOTTOM OF WHICH THERE APPEARS THE FOLLOWING PRINTED STATEMENT: "ALL QUOTATIONS, CONTRACTS, AND SALES ARE SUBJECT TO STRIKES, ACCIDENTS OR DELAYS OF ANY KIND BEYOND OUR CONTROL.'

OBVIOUSLY, IF A CONTRACT HAD BEEN AWARDED TO YOUR COMPANY, THAT STATEMENT WOULD HAVE LIMITED YOUR LIABILITY FOR A FAILURE TO PERFORM THE CONTRACT TO AN EXTENT NOT CONTEMPLATED UNDER THE DEFAULT CLAUSE MADE A PART OF THE INVITATION. THE DEFAULT CLAUSE PROVIDES IN EFFECT THAT THE CONTRACTOR WOULD BE HELD LIABLE FOR EXCESS COSTS IF FAILURE TO PERFORM THE CONTRACT DID NOT RESULT FROM CAUSES BEYOND THE CONTROL AND WITHOUT THE FAULT OR NEGLIGENCE OF THE CONTRACTOR AND THAT, IF FAILURE TO PERFORM RESULTED FROM A DEFAULT OF A SUBCONTRACTOR, THE CONTRACTOR WOULD NOT BE EXCUSED UNLESS SUCH DEFAULT AROSE OUT OF CAUSES BEYOND THE CONTROL OF BOTH THE CONTRACTOR AND THE SUBCONTRACTOR AND WITHOUT THE FAULT OR NEGLIGENCE OF EITHER OF THEM. ALSO, IN THE CASE OF A SUBCONTRACTOR'S DEFAULT, THE CONTRACTOR WOULD NOT BE EXCUSED IN ANY EVENT IF THE SUPPLIES OR SERVICES TO BE FURNISHED BY THE SUBCONTRACTOR WERE OBTAINABLE FROM OTHER SOURCES IN SUFFICIENT TIME TO PERMIT THE CONTRACTOR TO MEET THE REQUIRED DELIVERY SCHEDULE.

IT IS YOUR CONTENTION THAT THERE WAS NO INTENTION TO CONTRADICT THE BASIC OFFER MADE IN YOUR BID WHEN REQUESTING PROGRESS PAYMENTS AS PERMITTED BY THE TERMS OF THE INVITATION. HOWEVER, WE ARE OF THE OPINION THAT, SINCE THE LETTER OF JULY 20, 1961, WAS AN INTEGRAL PART OF THE BID, THE PRINTED STATEMENT AT THE BOTTOM OF THE LETTER WOULD TAKE PRECEDENCE OVER THE GENERAL AGREEMENT TO COMPLY WITH THE TERMS AND CONDITIONS OF THE INVITATION AND WOULD, UNDER WELL-ESTABLISHED PRINCIPLES OF LAW, CONTROL WHATEVER RIGHTS THE GOVERNMENT MIGHT HAVE TO ASSESS EXCESS COSTS FOR A FAILURE TO PERFORM IF A CONTRACT HAD BEEN AWARDED TO YOUR COMPANY.

AS STATED IN 36 COMP. GEN. 535 AT PAGE 539, IT IS AN ESTABLISHED RULE THAT A CONTRACT AWARDED TO A SUCCESSFUL BIDDER MUST BE THE CONTRACT OFFERED TO ALL BIDDERS AND, WHERE ONE BIDDER RESERVES RIGHTS AND IMMUNITIES FROM RESPONSIBILITY FOR BREACH NOT EXTENDED TO ALL BIDDERS BY THE ADVERTISED CONDITIONS AND SPECIFICATIONS, IT IS CLEAR THAT A CONTRACT AWARDED UPON THE BASIS OF SUCH A BID WOULD NOT BE THE CONTRACT OFFERED TO ALL PROSPECTIVE BIDDERS.

IN THE CIRCUMSTANCES, IT IS APPARENT THAT THERE WAS AN ADEQUATE BASIS FOR THE REJECTION OF YOUR BID AS NONRESPONSIVE. ACCORDINGLY, YOUR PROTEST IN THE MATTER MUST BE DENIED.