B-154409, AUG. 11, 1964

B-154409, AUG. 11, 1964

TO CUTLER-HAMMER:

FURTHER REFERENCE IS MADE TO YOUR LETTER DATED JUNE 5, 1964, PROTESTING THE AWARD OF ANY CONTRACT UNDER NAVY PURCHASING OFFICE INVITATION NO. IFB600-626-64 TO THE LOW BIDDER, THE HARTMAN ELECTRICAL MANUFACTURING COMPANY, MANSFIELD, OHIO. YOU STATE THAT THE LOW BIDDER HAS NOT ONLY FAILED TO CONFORM WITH THE SPECIFICATIONS CONTAINED IN THE INVITATION BUT HAS ALSO IMPOSED CONDITIONS WHICH MODIFIED THE REQUIREMENTS OF THE BID SO AS TO BE PREJUDICIAL TO THE OTHER BIDDERS. SPECIFICALLY, YOU SET FORTH THE FOLLOWING POINTS IN SUPPORT OF YOUR PROTEST: THAT HARTMAN FAILED TO QUOTE ITEM 5 AND, AS A RESULT, ITEM 6 IS ALSO INCOMPLETE; THAT ITEM 10 WAS QUOTED ON A "NO CHARGE" BASIS EVEN THOUGH HARTMAN ALLEGEDLY COULD NOT COMPLY WITH THE ITEM'S REQUIREMENTS; THAT HARTMAN EXPRESSLY QUALIFIED ITS PRICE ON THE OPTION ITEMS 12, 13, AND 14 BY STATING THAT "THE PRICES QUOTED FOR ITEMS 12, 13 AND 14 ARE VALID IF PURCHASED AT THE SAME TIME AS LOT 1" AND THAT THE LOW BIDDER FAILED TO ACKNOWLEDGE AMENDMENT NO. 1 WHICH, YOU STATE, IS FURTHER REASON FOR YOUR CONTENTION THAT HARTMAN SUBMITTED AN INCOMPLETE AND NONRESPONSIVE BID.

BIDS WERE OPENED MAY 27, 1964, UNDER INVITATION NO. IFB600-626-64 FOR A TOTAL FIRM QUANTITY OF 369 POWER CONTROL BOXES, ITEMS 1 THROUGH 5, PLUS TEST SAMPLES, DATA, PUBLICATIONS AND TOTAL OPTION QUANTITY OF 207 IN ITEMS 12, 13 AND 14. THE LOW BID OF $1,108.80 PER UNIT WAS SUBMITTED BY THE HARTMAN ELECTRICAL MANUFACTURING COMPANY. FIVE OTHER BIDS WERE RECEIVED RANGING FROM $1,181 TO $2,483 PER UNIT. THE TOTAL ESTIMATED AMOUNT OF THE PROCUREMENT WAS $639,100. ON THE BID SUBMITTED BY HARTMAN A PRICE OF $1,108.80 WAS INSERTED FOR ITEMS 1 THROUGH 4 AS WELL AS FOR THE OPTION QUANTITIES. NO AMOUNT WAS SHOWN FOR LINE ITEM 5. THE BID INCLUDED THE NOTATION: "THE PRICES QUOTED FOR ITEMS 1 THROUGH 5 APPLY FOR A MINIMUM TOTAL QUANTITY OF 369 BOXES.'

AFTER THE OPENING HARTMAN'S REPRESENTATIVE ORALLY ALLEGED THE BIDDER'S INTENT TO INSERT THE PRICE OF $1,108.80 FOR ITEM 5. THE BIDDER FURNISHED ITS ORIGINAL WORK COPY OF THE BID FROM WHICH THE BID SUBMITTED WAS TYPED. THIS WORKSHEET SHOWS AN IDENTICAL PRICE FOR EACH OF THE CONTROL BOX LINE ITEMS OF $1,108.80, INCLUDING ITEM 5. AN AFFIDAVIT SIGNED BY THE VICE PRESIDENT OF THE COMPANY ASSERTED THE INTENDED BID AS $1,108.80 EACH FOR THE ENTIRE REQUIREMENTS OF ITEMS 1 THROUGH 5, OR 369 UNITS. CORRECTION OF THE BID WAS REQUESTED.

SINCE THE MISTAKE AND INTENDED BID ARE ASCERTAINABLE SUBSTANTIALLY FROM THE INVITATION AND THE BID AND SINCE CORRECTION OF THE BID WOULD NOT DISPLACE AN OTHERWISE LOW BID, WE MUST CONCLUDE THAT CORRECTION OF THE BID AS TO THIS ITEM MAY BE PERMITTED WITHOUT PREJUDICE TO OTHER BIDDERS AND TO THE BIDDING SYSTEM. SEE ARMED SERVICES PROCUREMENT REGULATION 2-406.3 (A) (3).

ITEM 10 OF THE INVITATION COVERS PUBLICATIONS FOR ITEMS 1, 2, 3, 4, 5, 13 AND 14. THE SPECIFICATIONS STATE THAT PUBLICATIONS SHALL BE IN ACCORDANCE WITH TMCR SERIAL NO. 680-63 DATED JULY 1, 1963. THIS MAKES SPECIFIC REFERENCE TO CUTLER-HAMMER POWER CONTROL BOX, 6043HI-5, SINCE THE ITEM HAS PREVIOUSLY BEEN SOLE SOURCE WITH THAT COMPANY. ITEM 10 CALLS FOR PUBLICATIONS COVERING EQUIPMENT FURNISHED UNDER THE CONTRACT, HOWEVER, AND IT WOULD BE HIGHLY IMPROBABLE THAT ANY BIDDER OTHER THAN CUTLER-HAMMER WOULD FURNISH CUTLER-HAMMER EQUIPMENT. THEREFORE, ANY REFERENCE TO CUTLER -HAMMER EQUIPMENT IN CONNECTION WITH THE PUBLICATIONS ITEM OF THE INVITATION MUST BE CONSTRUED AS AN IMMATERIAL INADVERTENCE WITH RESPECT TO OTHER BIDDERS WHO COULD NOT REASONABLY EXPECT OR BE EXPECTED TO PROVIDE PUBLICATIONS COVERING CUTLER-HAMMER EQUIPMENT. COMPARE 40 COMP. GEN. 321.

THE HARTMAN ELECTRICAL MANUFACTURING COMPANY BID UPON OPTION ITEMS 12 THROUGH 14 STATING:"THE PRICES QUOTED FOR ITEMS 12, 13 AND 14 ARE VALID IF PURCHASED AT THE SAME TIME AS LOT I.' THUS, IF THE OPTION IS EXERCISED AT THE TIME OF THE AWARD THE BID IS RESPONSIVE TO THESE OPTION ITEMS; IF THE OPTION IS NOT EXERCISED AT THE TIME OF AWARD, THERE IS NO BID ON THESE ITEMS. WHILE BIDDERS ARE URGED TO SUPPLY PRICES FOR EACH QUANTITY UNDER ITEMS 12, 13 AND 14 FOR PROPER EVALUATION OF BIDS, THIS IS STATED TO BE BECAUSE THE GOVERNMENT MAY DECIDE TO EXERCISE ITS OPTION OF ANY OR ALL OF THE QUANTITIES AT TIME OF AWARD. CLEARLY, BIDDING THEREON IS NOT A MANDATORY PROVISION. THE BID PRICES OF THE HARTMAN ELECTRICAL MANUFACTURING COMPANY WERE IDENTICAL FOR ALL ITEMS. HOWEVER, THEIR "ALL OR NONE" PROVISION APPLIED ONLY TO THE FIRM QUANTITY AND THERE IS NO ASSURANCE THAT THE OPTION WILL BE EXERCISED. THEREFORE, IT IS REASONABLE TO CONCLUDE THAT THE OPTION QUANTITIES HAVE NOT INFLUENCED THE PRICING OF THE FIRM QUANTITIES IN ANY OF THE BIDS RECEIVED.

THE RECORD SHOWS THAT AMENDMENT 1 TO THE INVITATION FOR BIDS WAS ISSUED AS A RESULT OF REQUESTS FOR PROSPECTIVE BIDDERS FOR TEST VALUES WHICH THE GOVERNMENT IS UNABLE TO PROVIDE. THE REQUIRED ITEMS ARE COMPONENTS WHICH MUST BE TESTED FOR COMPATIBILITY WITH AN AIRCRAFT ELECTRICAL SYSTEM, AND THE "FIRST ARTICLE SAMPLE" CLAUSE OF THE INVITATION PROVIDED THAT THE CONTRACTOR WOULD BE LIABLE TO THE GOVERNMENT FOR COSTS INCIDENT TO RETESTING. AMENDMENT 1 RELAXED THIS REQUIREMENT WHICH COULD OBVIOUSLY HAVE ONLY A DOWNWARD EFFECT ON PRICE. AMENDMENT 1 ALSO RELAXED THE PACKING AND PACKAGING REQUIREMENTS TO PROVIDE THAT PRESERVATION ON INSTALLATION ITEMS BE AT LEVEL C (IN ACCORDANCE WITH THE MANUFACTURER'S COMMERCIAL PRACTICE) INSTEAD OF AT LEVEL A (THE MOST EXPENSIVE METHOD). THUS, ANY POSSIBLE EFFECT ON PRICE AGAIN WOULD BE DOWNWARD. ALL OTHER ITEMS AND CONDITIONS OF THE INVITATION REMAINED UNCHANGED UNDER AMENDMENT 1. FOR THESE REASONS, THE FAILURE TO RETURN AMENDMENT 1 COULD NOT PREJUDICE THE POSITIONS OF THE OTHER BIDDERS AND MUST BE CONSIDERED A MINOR INFORMALITY. THE COMPANY HAS, SUBSEQUENT TO BID OPENING, EXECUTED AND RETURNED COPIES OF AMENDMENT 1 WHICH WERE ALREADY IN ITS POSSESSION PRIOR TO SUBMISSION OF ITS BID.

OUR OFFICE HAS HELD THAT THE PREPARATION OF SPECIFICATIONS STATING THE NEEDS OF THE GOVERNMENT AND THE FACTUAL DETERMINATION AS TO WHETHER THE EQUIPMENT OFFERED MEETS THE PROVISIONS OF THE SPECIFICATIONS ARE MATTERS PRIMARILY WITHIN THE JURISDICTION OF THE ADMINISTRATIVE AGENCY CONCERNED. 38 COMP. GEN. 190. IN DECIDING WHETHER THE EQUIPMENT OFFERED CONFORMS TO THE SPECIFICATIONS, THE CONTRACTING OFFICER MAY WAIVE MINOR VARIANCES NOT AFFECTING PRICE, QUALITY OR QUANTITY. 30 COMP. GEN. 179.

THE CONCEPT OF FORMAL ADVERTISING INSOFAR AS IT RELATES TO THE SUBMISSION AND EVALUATION OF BIDS GOES NO FURTHER THAN TO GUARANTEE EQUAL OPPORTUNITY TO COMPETE AND EQUAL TREATMENT IN THE EVALUATION OF BIDS. IT DOES NOT CONFER UPON BIDDERS ANY RIGHT TO INSIST UPON THE ENFORCEMENT OF IMMATERIAL PROVISIONS IN AN INVITATION, THE WAIVER OF WHICH WOULD NOT RESULT IN AN UNFAIR COMPETITIVE ADVANTAGE TO OTHER BIDDERS. TO HOLD OTHERWISE WOULD BE TO AUTHORIZE AWARD TO A HIGH BIDDER FOR PURPOSES OF ENFORCING A PROVISION IN AN INVITATION WHICH, IF WAIVED, RESULTS IN NO DISADVANTAGE TO THE HIGHER BIDDER AND, IF NOT WAIVED, WOULD OPERATE TO FORECLOSE AND IGNORE THE RIGHTS AND INTERESTS OF THE GOVERNMENT. WHILE WE RECOGNIZE THAT THE BID INVITATION IN THIS CASE COULD HAVE BEEN DRAWN WITH MORE PRECISION SO AS TO COMPLETELY ELIMINATE ANY UNCERTAINTY IN THE REQUIREMENTS FOR SUBMISSION OF BIDS, WE DO NOT THINK THAT THE INVITATION AS DRAWN CAUSED ANY BIDDER TO SUFFER ANY ACTUAL PREJUDICE OR INEQUITABLE TREATMENT.

THE ADMINISTRATIVE OFFICE EXPRESSED THE OPINION THAT ANY EXCEPTIONS, DEVIATIONS OR OMISSIONS IN THE BID OF THE HARTMAN ELECTRICAL MANUFACTURING COMPANY WERE MINOR AND ACCEPTABLE AND COULD NOT BE USED TO JUSTIFY REJECTION OF THE BID. IN THE LIGHT OF OUR HOLDINGS, WE ARE CONSTRAINED TO ENDORSE THIS VIEW AND, ACCORDINGLY, YOUR PROTEST MUST BE DENIED.