B-151332, AUG. 7, 1963
Highlights
THIS OFFICE HAS IN PAST DECISIONS STATED THAT WHERE A CONTRACT IS AWARDED ERRONEOUSLY AND THE CONTRACTOR HAS BEGUN PERFORMANCE. THE AWARD WILL NOT BE DISTURBED IF THE ERROR ON THE PART OF THE PROCUREMENT OFFICIALS IS INSIGNIFICANT IN NATURE AND IF PERFORMANCE OF THE CONTRACT INVOLVES A SUBSTANTIAL INITIAL INVESTMENT OR AN EXTENDED PERIOD OF PREPARATION ON THE PART OF THE CONTRACTOR. THERE IS NO EVIDENCE TO INDICATE THAT THE CONTRACT WAS ENTERED INTO IN BAD FAITH. IT IS OBVIOUS IN THIS CASE THAT AWARD WOULD HAVE BEEN MADE TO E-W CONSTRUCTION COMPANY AND L. WHILE THEIR BID WAS TECHNICALLY NONRESPONSIVE. IT IS CLEAR IN THIS CASE THAT CANCELLATION OF THE CONTRACT AND THE GOVERNMENT'S POSSIBLE LIABILITY THEREFOR WOULD NOT BE IN THE BEST INTERESTS OF THE GOVERNMENT.
B-151332, AUG. 7, 1963
TO MOTTNER AND MCCUTCHEN:
YOUR LETTER DATED JULY 9, 1963, MAKING FURTHER PROTEST AGAINST THE AWARD TO ANOTHER BIDDER BY THE BUREAU OF RECLAMATION UNDER SPECIFICATIONS NO. DC -5877 AND REQUESTING RECONSIDERATION OF OUR DECISION DATED JUNE 27, 1963, HAS BEEN RECEIVED AND STUDIED BY THIS OFFICE.
OUR DECISION HELD THAT THE AWARD TO A NONRESPONSIVE LOW BIDDER WOULD NOT BE DISTURBED IN THIS CASE. THIS OFFICE HAS IN PAST DECISIONS STATED THAT WHERE A CONTRACT IS AWARDED ERRONEOUSLY AND THE CONTRACTOR HAS BEGUN PERFORMANCE, THE AWARD WILL NOT BE DISTURBED IF THE ERROR ON THE PART OF THE PROCUREMENT OFFICIALS IS INSIGNIFICANT IN NATURE AND IF PERFORMANCE OF THE CONTRACT INVOLVES A SUBSTANTIAL INITIAL INVESTMENT OR AN EXTENDED PERIOD OF PREPARATION ON THE PART OF THE CONTRACTOR. B-137255 DATED OCTOBER 30, 1958.
THE PRESENT CONTRACTOR HAS ENTERED INTO COMMITMENTS AND INITIATED THE WORK ON THE BASIS OF THE AWARD, AND THERE IS NO EVIDENCE TO INDICATE THAT THE CONTRACT WAS ENTERED INTO IN BAD FAITH.
AS STATED IN B-139516 DATED SEPTEMBER 21, 1959:
"WE REALIZE THAT AN UNSUCCESSFUL BIDDER SOMETIMES DERIVES NO MATERIAL BENEFIT FROM A SUCCESSFUL PROTEST. HOWEVER, EVEN IN THOSE CASES WE BRING THE IMPROPER ACTION OR PROCEDURES INVOLVED TO THE ATTENTION OF THE HEAD OF THE CONTRACTING AGENCY IN ORDER THAT RECURRENCES MAY BE AVOIDED. CONSEQUENTLY, WHILE THE BID PROTEST PROCEDURE MAY NOT AFFORD AN ADEQUATE REMEDY IN EVERY CASE WE FEEL THAT THE AVAILABILITY OF THE PROCEDURE IN THIS OFFICE SERVES A SALUTARY PURPOSE IN HELPING TO MAINTAIN PROPER CONTRACTING PROCEDURES ON A GOVERNMENT-WIDE BASIS AND PUBLIC CONFIDENCE IN THE COMPETITIVE BIDDING SYSTEM.'
IT IS OBVIOUS IN THIS CASE THAT AWARD WOULD HAVE BEEN MADE TO E-W CONSTRUCTION COMPANY AND L. D. SHILLING COMPANY, INC., AS THE LOWEST BIDDER BY SOME $20,000 HAD THE $312 ITEM NOT BEEN ERRONEOUSLY OMITTED FROM THE PROPER PLACE ON THEIR BID. WHILE THEIR BID WAS TECHNICALLY NONRESPONSIVE, IT IS CLEAR IN THIS CASE THAT CANCELLATION OF THE CONTRACT AND THE GOVERNMENT'S POSSIBLE LIABILITY THEREFOR WOULD NOT BE IN THE BEST INTERESTS OF THE GOVERNMENT.
SINCE THE STATUTES REGULATING CONTRACTING PROCEDURES WERE ENACTED SOLELY FOR THE BENEFIT OF THE GOVERNMENT, AND CONFER NO ENFORCEABLE RIGHTS UPON BIDDERS, THE GOVERNMENT MAY IN CERTAIN CIRCUMSTANCES ELECT TO WAIVE ITS RIGHTS WITHOUT BEING HELD TO HAVE COMMITTED AN IMPROPRIETY. PERKINS V. LUKENS STEEL COMPANY, 310 U.S. 113, 126.