B-149377, SEP. 18, 1962

B-149377: Sep 18, 1962

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TO BARRETT-CRAVENS COMPANY: FURTHER REFERENCE IS MADE TO YOUR LETTER DATED JULY 5. WHICH WAS ISSUED ON APRIL 27. ONE OTHER BID WAS RECEIVED UNDER THE INVITATION FROM LEWIS-SHEPARD PRODUCTS INC. WHICH WAS ACCOMPANIED BY A THREE AGE LETTER NOTING NUMEROUS EXCEPTIONS TO THE APPLICABLE SPECIFICATIONS. WAS DETERMINED TO BE NONRESPONSIVE BY THE DEFENSE SUPPLY AGENCY. YOUR BID ALSO WAS CONSIDERED TO BE NONRESPONSIVE BECAUSE THE LENGTH OF THE TRUCKS OFFERED BY YOU FAILED TO MEET THE SPECIFICATION COVERING THE PROCUREMENT. IN VIEW OF THE FACT THAT THE TWO BIDS RECEIVED WERE NONRESPONSIVE TO THE INVITATION. THEREAFTER OFFERS WERE SOLICITED FROM SIX CONCERNS. ALL OF WHOM WERE APPRISED OF ADDITIONAL DEVIATIONS FROM THE ORIGINAL SPECIFICATIONS WHICH RESULTED FROM THE NEGOTIATIONS.

B-149377, SEP. 18, 1962

TO BARRETT-CRAVENS COMPANY:

FURTHER REFERENCE IS MADE TO YOUR LETTER DATED JULY 5, 1962, ENCLOSING A COPY OF YOUR LETTER DATED JUNE 29, 1962, TO THE DEFENSE SUPPLY AGENCY, RICHMOND, VIRGINIA, PROTESTING THE AWARD OF THE CONTRACT UNDER INVITATION NO. DSA-4-62-1335.

IN RESPONSE TO THE INVITATION, AS AMENDED, WHICH WAS ISSUED ON APRIL 27, 1962, BY THE DIRECTORATE FOR PROCUREMENT, DEFENSE GENERAL SUPPLY CENTER, DEFENSE SUPPLY AGENCY, RICHMOND, VIRGINIA, YOU SUBMITTED A BID DATED MAY 18, 1962, OFFERING TO DELIVER TO THE DESTINATIONS TO BE SPECIFIED ITEMS NOS. 1A AND 1B, COVERING A TOTAL OF 90 TRUCKS, HAND, LIFT, PLATFORM, ELECTRIC, C., FOR A TOTAL PRICE OF $559,430. ONE OTHER BID WAS RECEIVED UNDER THE INVITATION FROM LEWIS-SHEPARD PRODUCTS INC., WATERTOWN, MASSACHUSETTS, IN THE TOTAL AMOUNT OF $347,020. THE BID OF LEWIS-SHEPARD, WHICH WAS ACCOMPANIED BY A THREE AGE LETTER NOTING NUMEROUS EXCEPTIONS TO THE APPLICABLE SPECIFICATIONS, WAS DETERMINED TO BE NONRESPONSIVE BY THE DEFENSE SUPPLY AGENCY. MOREOVER, YOUR BID ALSO WAS CONSIDERED TO BE NONRESPONSIVE BECAUSE THE LENGTH OF THE TRUCKS OFFERED BY YOU FAILED TO MEET THE SPECIFICATION COVERING THE PROCUREMENT. IN VIEW OF THE FACT THAT THE TWO BIDS RECEIVED WERE NONRESPONSIVE TO THE INVITATION, THE CONTRACTING OFFICER DETERMINED THAT IT WOULD BE IN ACCORD WITH THE SPIRIT AND LETTER OF MAINTAINING THE INTEGRITY OF THE BIDDING SYSTEM TO DECLARE BOTH BIDS NONRESPONSIVE, CANCEL THE INVITATION AND NEGOTIATE FOR THE TRUCKS. THEREAFTER OFFERS WERE SOLICITED FROM SIX CONCERNS, ALL OF WHOM WERE APPRISED OF ADDITIONAL DEVIATIONS FROM THE ORIGINAL SPECIFICATIONS WHICH RESULTED FROM THE NEGOTIATIONS, AND THE FOLLOWING OFFERS WERE RECEIVED:

TABLE

LEWIS-SHEPARD PRODUCTS INC. $389,316

MOTO-TRUC COMPANY 495,450

BARRETT-CRAVENS COMPANY 559,430

AMERICAN PULLEY COMPANY 632,950

THE OFFERS OF LEWIS-SHEPARD AND MOTO-TRUC WERE PREDICATED ON EXCEPTIONS TO THE SPECIFICATIONS WHICH WERE NOT APPROVED BY THE DEFENSE SUPPLY AGENCY AND THEREAFTER WHEN ADVISED OF SUCH DISAPPROVAL MOTO TRUC WITHDREW FROM THE NEGOTIATIONS. NEGOTIATIONS WERE CONTINUED AND RESULTED IN THE FOLLOWING PRICES:

TABLE

LEWIS-SHEPARD PRODUCTS INC. $447,450

AMERICAN PULLEY COMPANY 475,400

BARRETT-CRAVENS COMPANY 485,569

AS A RESULT OF THESE LATER OFFERS AND AFTER IT AGAIN WAS DETERMINED THAT LEWIS-SHEPARD'S BID WAS NONRESPONSIVE, A CONTRACT WAS ENTERED INTO ON JUNE 29, 1962, WITH THE AMERICAN PULLEY COMPANY, PHILADELPHIA, PENNSYLVANIA, FOR THE LIFT TRUCKS IN THE TOTAL AMOUNT OF $475,400. THIS AWARD RESULTED IN YOUR PROTEST.

IT APPEARS FROM YOUR LETTER DATED JUNE 29, 1962, TO THE RICHMOND OFFICE, DEFENSE SUPPLY AGENCY, THAT THE PROTEST IS BASED ON YOUR CONTENTION THAT UNDER INVITATION NO. DSA-4-62-1335 THE ONLY OTHER BID RECEIVED WAS ENTIRELY NONRESPONSIVE BUT THAT YOUR BID HAD NOT THE SPECIFICATIONS IN EVERY RESPECT EXCEPT FOR THE LENGTH OF THE TRUCKS, WHICH LENGTH SINCE HAS BEEN ACCEPTED UNDER REVISED SPECIFICATIONS, AND EXCEPT FOR A MINOR TECHNICALITY ON THE WEIGHT DATA FURNISHED IN YOUR BID. YOU ALSO CONTEND THAT THE SPECIFICATIONS WERE EXTREMELY DIFFICULT IN THAT THEY COVERED A SPECIAL TRUCK NEVER BUILT BEFORE BUT THAT YOU HAD PROVEN THAT THE TRUCK WAS ONE THAT COULD BE BUILT TO MEET THE FULL REQUIREMENTS OF THE GOVERNMENT. YOU POINT OUT THAT THIS BEING THE CASE IT LEFT YOUR BID PRICE THE ONLY POINT OF REFERENCE FOR ALL OF YOUR COMPETITORS WITH WHOM SUBSEQUENT NEGOTIATIONS COULD BE CARRIED ON WHICH ULTIMATELY RESULTED IN THE AWARD TO THE AMERICAN PULLEY COMPANY.

THE DEFENSE SUPPLY AGENCY REPORTS THAT WHILE YOUR BID UNDER INVITATION NO. DSA-4-62-1335 DID NOT CONTAIN A SPECIFIC EXCEPTION TO THE SPECIFICATIONS, THE INFORMATION FURNISHED BY YOU ON PAGE 3 OF THE INVITATION UNDER THE GUARANTEED MAXIMUM SHIPPING WEIGHTS AND DIMENSIONS CLAUSE SHOWED THAT FOR THE LEVEL "C" PACK (WITHOUT CRATE), AS REQUIRED BY ITEM NO. 1B OF THE INVITATION, THE UNIT PROPOSED TO BE FURNISHED WAS 138 INCHES LONG WHEREAS THE SPECIFICATIONS, PAGE 3, TABLE I, PROVIDED FOR "LENGTH (INCHES APPROX, W/POWER UNIT) 124.' THE CONTRACTING OFFICER DETERMINED THAT THE 14-INCH VARIANCE IN THE OVER ALL LENGTH OF THE TRUCK DID NOT FALL WITHIN THE "INCHES APPROX" REQUIREMENT OF THE SPECIFICATIONS AND, THEREFORE, DETERMINED THAT YOUR BID WAS NONRESPONSIVE. THIS WAS THE PRIMARY BASIS FOR THE REJECTION OF YOUR BID, RATHER THAN ANY DEFICIENCY IN THE WEIGHT DATA FURNISHED BY YOU. IN THIS REGARD, IF AN AWARD HAD BEEN MADE TO YOU ON THE BASIS OF AN EXCEPTION TO THE LENGTH DIMENSIONS IT WOULD HAVE BEEN UNFAIR UNLESS OFFERED TO ALL OTHER PROSPECTIVE BIDDERS. MOREOVER, THE FACT THAT THE OVER-ALL LENGTH SPECIFIED IN YOUR BID LATER MAY HAVE BEEN APPROVED AND ACCEPTED IN THE NEGOTIATIONS THAT FOLLOWED DOES NOT, IN ANY WAY, AFFECT THE PROPRIETY OF THE PREVIOUS DETERMINATION OF NONRESPONSIVENESS OF YOUR BID UNDER THE INVITATION, AND, AS A MATTER OF RECORD, THE DEFENSE SUPPLY AGENCY REPORTS THAT IT ALLOWED, AFTER FURTHER INFORMATION WAS GLEANED FROM SUBSEQUENT NEGOTIATIONS, ADDITIONAL EXCEPTIONS TO THE ORIGINAL SPECIFICATIONS AS A RESULT OF THE SAID NEGOTIATIONS AND THAT SUCH EXCEPTIONS RESULTED IN A COMMON BENEFIT TO ALL OFFERORS.

INSOFAR AS CONCERNS THAT PART OF YOUR PROTEST ALLEGING THAT YOUR ORIGINAL BID PRICE BECAME THE ONLY POINT OF REFERENCE TO ALL YOUR COMPETITORS IN FUTURE NEGOTIATIONS, WE MAY ONLY ADVISE THAT WE ARE FULLY AWARE THAT THE REJECTION OF BIDS AFTER THEY ARE OPENED AND EACH BIDDER OR SUBSEQUENT PROSPECTIVE BIDDER HAS LEARNED HIS COMPETITORS' PRICES IS A SERIOUS MATTER AND SUCH ACTION SHOULD NOT BE TAKEN EXCEPT FOR COGENT REASONS. HOWEVER, FOR THE REASONS EXPLAINED ABOVE, WE THINK THERE WAS A PROPER BASIS FOR THE ADMINISTRATIVE DETERMINATION OF THE NONRESPONSIVENESS OF YOUR ORIGINAL BID AND THE JUSTIFICATION TO PROCEED WITH THE PROCUREMENT ON THE NEGOTIATED BASIS. UNDER THE PROVISIONS OF 10 U.S.C. 2305 (C) ALL BIDS MAY BE REJECTED IF IT IS DETERMINED TO BE IN THE PUBLIC INTEREST. IN ADDITION, IN PARAGRAPH 8 (B) OF THE TERMS AND CONDITIONS OF THE INVITATION FOR BIDS, BIDDERS WERE ADVISED SPECIFICALLY THAT THE GOVERNMENT RESERVED THE RIGHT TO REJECT ANY AND ALL BIDS. EVEN IN THE ABSENCE OF SUCH RESERVATION, IT HAS BEEN HELD THAT A REQUEST FOR BIDS DOES NOT IMPORT AN OBLIGATION TO ACCEPT ANY OF THE OFFERS RECEIVED. O-BRIEN V. CARNEY, 6 F.SUPP. 761 AND COLORADO PAVING CO. V. MURPHY, 78 F. 28. HAVING REGARD FOR THE FACT THAT YOUR BID WAS NONRESPONSIVE AND IN VIEW OF THE AUTHORITY CITED ABOVE, WE CANNOT FIND THAT THE REJECTION OF ALL BIDS REPRESENTED AN ABUSE OF THE ADMINISTRATIVE DISCRETION RESERVED IN THE INVITATION AND GRANTED BY THE STATUTE. MOREOVER, THE CONTENTION THAT YOUR ORIGINAL BID PRICE BECAME A POINT OF REFERENCE TO ALL YOUR COMPETITORS IN THE SUBSEQUENT NEGOTIATIONS IS NOT BORNE OUT BY THE OFFERS SUBMITTED BY YOUR COMPETITORS OF EITHER THE FIRST OR FINAL ROUND OF THE NEGOTIATIONS. THE RECORD SHOWS THAT THE SUCCESSFUL OFFEROR, THE AMERICAN PULLEY COMPANY, FIRST QUOTED A TOTAL PRICE 13 PERCENT HIGHER THAN YOUR ORIGINAL BID PRICE.

IN VIEW OF THE FOREGOING, WE MUST CONCLUDE THAT THE ACTION TAKEN BY THE DEFENSE SUPPLY AGENCY IN THE MATTER IS NOT SUBJECT TO LEGAL OBJECTION.