B-149165, SEP. 4, 1962

B-149165: Sep 4, 1962

Additional Materials:

Contact:

Edda Emmanuelli Perez
(202) 512-2853
EmmanuelliPerezE@gao.gov

 

Office of Public Affairs
(202) 512-4800
youngc1@gao.gov

ESQUIRE: FURTHER REFERENCE IS MADE TO YOUR LETTER DATED JUNE 13. DELIVERY 1HDR XXXXX00001-002 AFLITEDATA68261-000 OF THE FIRST 36 ITEMS WAS TO BE MADE TO THE SEVERAL DESIGNATED DESTINATIONS AND DELIVERY OF ITEMS 27 THROUGH 45 WAS TO BE MADE AT THE POINT OF ORIGIN. THE DEPARTMENT OF THE NAVY REPORTED THAT NINE BIDS WERE RECEIVED AND OPENED AT THE INDICATED HOUR AND THEREAFTER TABULATED. WERE AS FOLLOWS: CHART TOTAL ITEMS LESS 1 THRU 50 DISCOUNT FREIGHT TOTAL SPACE $210. OR (III) PLACED ON WHARF OF WATER CARRIER (WHERE MATERIAL WILL ORIGINATE WITHIN OR ADJACENT TO A PORT AREA AND IS ADAPTABLE TO WATER MOVEMENT). /BIDDER (OFFEROR) INSERT CITY OR TOWN IN WHICH PLANT IS LOCATED). /BIDDER (OFFEROR) INSERT EXACT LOCATION OF PRIVATE SIDING OR NEAREST RAIL TERMINAL FROM WHICH RAIL SHIPMENT WILL BE MADE.

B-149165, SEP. 4, 1962

TO F. TROWBRIDGE VOM BAUR, ESQUIRE:

FURTHER REFERENCE IS MADE TO YOUR LETTER DATED JUNE 13, 1962, WITH ENCLOSURES, PROTESTING ON BEHALF OF THE SPACE CORPORATION, DALLAS, TEXAS, THE AWARD OF A CONTRACT TO WOLLARD AIRCRAFT SERVICE EQUIPMENT, INC., MIAMI, FLORIDA, UNDER INVITATION FOR BIDS NO. 600-1058-62, ISSUED BY THE U.S. NAVY PURCHASING OFFICE, WASHINGTON, D.C., UNDER DATE OF MARCH 20, 1962. ALSO, THERE HAS BEEN RECEIVED YOUR LETTER DATED JULY 30, 1962, RELATING FURTHER TO THE MATTER OF YOUR PROTEST.

THE RECORD SHOWS THAT BY THE CITED INVITATION FOR BIDS, AS AMENDED, THE U.S. NAVY PURCHASING OFFICE INVITED BIDS FOR FURNISHING, AMONG OTHER THINGS, 75 AIRCRAFT BOARDING MOBIL STAIRCASES (ITEMS 1 THROUGH 45), THE BIDS TO BE OPENED AT 10:30 A.M. ON APRIL 26, 1962. DELIVERY 1HDR XXXXX00001-002 AFLITEDATA68261-000 OF THE FIRST 36 ITEMS WAS TO BE MADE TO THE SEVERAL DESIGNATED DESTINATIONS AND DELIVERY OF ITEMS 27 THROUGH 45 WAS TO BE MADE AT THE POINT OF ORIGIN. THE PROTEST IN THIS CASE RELATES ONLY TO THE LATTER ITEMS.

THE DEPARTMENT OF THE NAVY REPORTED THAT NINE BIDS WERE RECEIVED AND OPENED AT THE INDICATED HOUR AND THEREAFTER TABULATED. THE TOTALS OF THE TWO LOWEST BIDS, AS DETERMINED BY THE DEPARTMENT OF THE NAVY, INCLUDING APPLICABLE TRANSPORTATION CHARGES FROM THE POINT OF ORIGIN, WERE AS FOLLOWS:

CHART

TOTAL ITEMS LESS

1 THRU 50 DISCOUNT FREIGHT TOTAL

SPACE $210,874.07 PLUS $11,938.71 EQU. $222,812.78

WOLLARD (TRUCK/$212,338.80 $211,277.11 PLUS $ 9,828.64 EQU. $221,015.75

(RAIL) $213,720.10 $212,651.50 PLUS $ 9,828.64 EQU. $222,480.14

AS TO ITEMS 37 THROUGH 45, THE INVITATION FOR BIDS (PAGE 17) PROVIDED:

"PLACE OF DELIVERY: ORIGIN (APPLICABLE TO ITEMS 37 THROUGH 45)

(A) THE ARTICLES TO BE FURNISHED HEREUNDER SHALL BE DELIVERED FREE OF EXPENSE TO THE GOVERNMENT AND, AT THE GOVERNMENT'S OPTION, (I) LOADED, BLOCKED AND BRACED ON BOARD CARRIER'S EQUIPMENT, (II) AT THE FREIGHT STATION, OR (III) PLACED ON WHARF OF WATER CARRIER (WHERE MATERIAL WILL ORIGINATE WITHIN OR ADJACENT TO A PORT AREA AND IS ADAPTABLE TO WATER MOVEMENT), AT OR NEAR CONTRACTOR'S PLANT AT

"/1) GARLAND, TEXAS------------------/BIDDER (OFFEROR) INSERT CITY

OR TOWN IN WHICH PLANT IS

LOCATED),

"/2/----------------------------------/BIDDER (OFFEROR) INSERT EXACT

LOCATION OF PRIVATE SIDING OR

NEAREST RAIL TERMINAL FROM WHICH

RAIL SHIPMENT WILL BE MADE,

TOGETHER WITH THE NAME OF

SERVING RAILROAD/S) (,

"/3) SHILOH ROAD AND FAIRDALE

AVENUE, GARLAND, TEXAS----------/BIDDER (OFFEROR) INSERT THE

EXACT LOCATION FROM WHICH TRUCK

SHIPMENTS WILL BE MADE,

INCLUDING THE NAME OF THE STREET

OR HIGHWAY), AND

"/4/----------------------------------/BIDDER (OFFEROR) INSERT THE

PORT, OR THE SPECIFIC AREA

WITHIN SUCH PORT, TO WHICH

SUPPLIES WILL BE DELIVERED),

FOR SHIPMENT AT GOVERNMENT EXPENSE (NORMALLY ON GOVERNMENT BILL OF LADING) TO DESTINATIONS SPECIFIED HEREIN.'

IN ITS BID SPACE CORPORATION GIVE THE LOCATION OF ITS PLANT AS GARLAND, TEXAS, AND GAVE THE EXACT LOCATION IN GARLAND FROM WHICH TRUCK SHIPMENTS WOULD BE MADE, BUT IT FAILED TO GIVE THE LOCATION OF THE NEAREST TERMINAL FROM WHICH RAIL SHIPMENTS COULD BE MADE. ALSO, IT DID NOT LIST ANY PORT TO WHICH SUPPLIES WOULD BE DELIVERED FOR OCEAN SHIPMENT. THE CONTRACTING OFFICER STATES THAT SINCE RAIL SHIPMENT FROM GARLAND APPEARED TO BE FEASIBLE, SPACE CORPORATION WAS REQUESTED TO COMPLETE THE APPLICABLE BLANKS.

WE HAVE BEEN FURNISHED A COPY OF A LETTER DATED MAY 2, 1962, FROM THE SPACE CORPORATION TO THE U.S. NAVY PURCHASING OFFICE, WHEREIN THE BIDDER COMPLETED THE BLANKS IN THE INDICATED CLAUSE, AS FOLLOWS:

CHART

"/2) GARLAND, TEXAS, SANTE FE AND M-K-T--/BIDDER (OFFEROR) INSERT

EXACT LOCATION OF PRIVATE

SIDING OR NEAREST RAIL

TERMINAL FROM WHICH RAIL

SHIPMENT WILL BE MADE,

TOGETHER WITH THE NAME OF

SERVING RAILROAD/S) (,

"/4) PORT OF HOUSTON, TEXAS--------------/BIDDER (OFFEROR) INSERT

THE PORT, OR SPECIFIC AREA

WITHIN SUCH PORT, TO WHICH

SUPPLIES WILL BE

DELIVERED),"

BY YOUR LETTER DATED JUNE 13, 1962, YOU PROTESTED THE AWARD OF A CONTRACT ON JUNE 1, 1962, TO WOLLARD AIRCRAFT SERVICE EQUIPMENT, INC., IT BEING CONTENDED IN YOUR LETTER THAT THE SPACE CORPORATION SUBMITTED ITS BID ON THE THEORY THAT THE INVITATION FOR BIDS REQUIRED TRANSPORTATION FROM GARLAND, TEXAS, TO THE PORT OF HOUSTON, TEXAS, FOR WATER TRANSPORTATION, TO BE AT THE EXPENSE OF THE SPACE CORPORATION. IN SUPPORT OF YOUR CLIENT'S PROTEST, YOU TOOK THE POSITION THAT THE CONTRACTING OFFICER WAS IN ERROR IN CONCLUDING THAT THE TRANSPORTATION COSTS FROM GARLAND, TEXAS, TO THE PORT OF HOUSTON WOULD BE AT GOVERNMENT EXPENSE, IT BEING CONTENDED IN YOUR LETTER THAT THE PROVISION (ITEM 4) FOR DELIVERY "WITHIN OR ADJACENT TO A PORT AREA" MUST BE CONSTRUED TO MEAN THAT THE ITEMS MUST BE "PLACED ON WHARF OF WATER CARRIER" AT THE PORT OF HOUSTON BY THE BIDDER "FREE OF EXPENSE TO THE GOVERNMENT," ETC. FOR THE REASONS SET FORTH IN YOUR LETTER, YOU STATED THAT THE AWARD TO WOLLARD SHOULD BE CANCELLED AND A CONTRACT AWARDED TO YOUR CLIENT.

IN YOUR LETTER OF JULY 30, 1962, YOU COMMENTED UPON THE CONTRACTING OFFICER'S STATEMENT OF FACT DATED JUNE 21, 1962, TRANSMITTED HERE BY THE UNDER SECRETARY OF THE NAVY WITH LETTER DATED JULY 20, 1962. YOU CONTENDED, AMONG OTHER THINGS, THAT YOUR CLIENT INTENDED TO DELIVER THE SUPPLIES AT HOUSTON, TEXAS, FREE OF EXPENSE TO THE GOVERNMENT; THAT THE SPACE CORPORATION IS BOUND AND ESTOPPED TO CLAIM OTHERWISE, AND THAT HOUSTON MUST BE CONSIDERED AS AN INTERMEDIATE POINT OF ORIGIN TO WHICH YOUR CLIENT OFFERED TO MAKE DELIVERY FREE OF EXPENSE TO THE GOVERNMENT.

YOU ALSO CONTEND THAT THE FAILURE OF YOUR CLIENT TO FURNISH THE REQUIRED INFORMATION CONCERNING PORT DELIVERY IN ITS ORIGINAL BID IS OF NO SIGNIFICANCE, SINCE THE SPACE CORPORATION WAS REQUESTED BY THE CONTRACTING OFFICER TO FURNISH THIS DATA AFTER THE BIDS WERE OPENED; ALSO, THAT ANY FAILURE TO FILL IN THE BLANKS ORIGINALLY WAS AN INFORMALITY WHICH WAS WAIVED BY THE CONTRACTING OFFICER.

WE AGREE THAT HAD YOUR CLIENT NAMED THE PORT OF HOUSTON IN ITS BID ANY TIME BEFORE OPENING ACCEPTANCE OF THE BID WOULD HAVE OBLIGATED THE COMPANY TO DELIVER THE ITEMS IN QUESTION TO THAT PORT "FREE OF EXPENSE TO THE GOVERNMENT," AS CLEARLY PROVIDED BY THE DELIVERY ARTICLE OF THE INVITATION. THE CONTROLLING QUESTION IN THE CASE IS, HOWEVER, WHETHER IT WAS LEGALLY PROPER TO PERMIT YOUR CLIENT TO AMEND ITS BID BY FURNISHING THE ADDITIONAL INFORMATION COVERING ITS PROPOSED SHIPPING POINTS AFTER THE BID OPENING AND THEN PROCEED TO EVALUATE THE BID ON THE BASIS OF SUCH ADDITIONAL INFORMATION. WE BELIEVE THIS QUESTION MUST BE ANSWERED IN THE NEGATIVE.

IT CANNOT BE REASONABLY ASSUMED THAT THE SHIPMENT FROM YOUR CLIENT'S PLANT TO A PORT AS DISTANT AS 250 MILES WOULD HAVE ENTAILED NO ADDITIONAL COST TO THE COMPANY. IN OUR OPINION, THEREFORE, IF YOUR CLIENT INTENDED TO OFFER FREE PORT DELIVERY AND HAVE ITS BID EVALUATED ACCORDINGLY IT WAS ABSOLUTELY NECESSARY FOR YOUR CLIENT TO FURNISH SUCH INFORMATION BEFORE THE TIME SET FOR OPENING.

OUR OFFICE AND THE COURTS HAVE HELD MANY TIMES THAT UNDER THE PROCEDURE OF LETTING PUBLIC CONTRACTS ON AN OPEN COMPETITIVE BASIS BIDS MUST CONFORM IN SUBSTANCE WITH THE ADVERTISED SPECIFICATIONS AND BIDDERS MAY NOT BE PERMITTED TO VARY THEIR BIDS MATERIALLY AFTER THE PUBLIC OPENING. IT IS TRUE THAT CONTRACTING OFFICERS MAY WAIVE INFORMALITIES IN BIDS; THEY MAY NOT, HOWEVER, WAIVE THE RULE OF LAW WHICH PRECLUDES MATERIAL CHANGES IN BIDS AFTER OPENING AND THE CHANGE INVOLVED HERE MUST BE CONSIDERED MATERIAL. THIS IS TRUE BECAUSE, AS POINTED OUT ABOVE, SHIPMENT IN ACCORDANCE WITH THE AMENDATORY INFORMATION LATER SUPPLIED WOULD HAVE RESULTED IN ADDITIONAL TRANSPORTATION COSTS AFFECTING YOUR CLIENT'S PERFORMANCE COST. FOR THAT REASON AND SINCE THERE WAS NO INDICATION IN YOUR CLIENT'S ORIGINAL BID OF ANY INTENTION TO MAKE DELIVERY TO THE PORT OF HOUSTON WITHOUT COST TO THE GOVERNMENT FOR THE ADDITIONAL TRANSPORTATION CHARGES, IT WOULD NOT HAVE BEEN LEGALLY PROPER TO EVALUATE YOUR CLIENT'S BID ON THE BASIS OF ITS BID PRICE PLUS THE COST OF WATER TRANSPORTATION TO THE VARIOUS DESTINATIONS.