B-15452, MARCH 17, 1941, 20 COMP. GEN. 530

B-15452: Mar 17, 1941

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ADVERTISING - BIDS - LATE OPENING DUE TO IMPROPER MARKING WHERE AN UNSIGNED AND OTHERWISE INCOMPLETE BID WAS SUBMITTED TO THE CIVIL AERONAUTICS ADMINISTRATION IN AN IMPROPERLY MARKED RETURN ENVELOPE. THE BID WAS NOT OPENED UNTIL AFTER THE OTHERWISE LOW BID HAD BEEN ACCEPTED. PARTICULARLY SINCE THE FORMAL CONTRACT AND BONDS EXECUTED BY THE BIDDER AND SUBMITTED TO THE GOVERNMENT HAVE APPARENTLY BEEN APPROVED AND NO ACTION HAS BEEN TAKEN TO COMPLETE THE DEFICIENT BID BY THE BIDDER WHO SUBMITTED IT. 1941: I HAVE YOUR LETTER OF MARCH 11. AS FOLLOWS: ENCLOSED HEREWITH ARE THE BIDS RECEIVED BY THE CIVIL AERONAUTICS ADMINISTRATION ON MARCH 5. THESE BIDS WERE MADE ON CIVIL AERONAUTICS ADMINISTRATION PROPOSAL NO. 802 AND ARE FOR THE ERECTION OF CERTAIN RADIO BUILDINGS AT THE WASHINGTON NATIONAL AIRPORT.

B-15452, MARCH 17, 1941, 20 COMP. GEN. 530

ADVERTISING - BIDS - LATE OPENING DUE TO IMPROPER MARKING WHERE AN UNSIGNED AND OTHERWISE INCOMPLETE BID WAS SUBMITTED TO THE CIVIL AERONAUTICS ADMINISTRATION IN AN IMPROPERLY MARKED RETURN ENVELOPE, WHICH HAD BEEN FURNISHED BY THE GOVERNMENT, AND, THEREFORE, THE BID WAS NOT OPENED UNTIL AFTER THE OTHERWISE LOW BID HAD BEEN ACCEPTED, A BINDING CONTRACT RESULTED FROM THE ACCEPTANCE, AND NO ACTION SHOULD BE TAKEN TOWARD REVOCATION OF THE AWARD, PARTICULARLY SINCE THE FORMAL CONTRACT AND BONDS EXECUTED BY THE BIDDER AND SUBMITTED TO THE GOVERNMENT HAVE APPARENTLY BEEN APPROVED AND NO ACTION HAS BEEN TAKEN TO COMPLETE THE DEFICIENT BID BY THE BIDDER WHO SUBMITTED IT.

COMPTROLLER GENERAL WARREN TO THE SECRETARY OF COMMERCE, MARCH 17, 1941:

I HAVE YOUR LETTER OF MARCH 11, 1941, AS FOLLOWS:

ENCLOSED HEREWITH ARE THE BIDS RECEIVED BY THE CIVIL AERONAUTICS ADMINISTRATION ON MARCH 5, FROM SAMUEL ALPHER AND J. B. BOLLING. THESE BIDS WERE MADE ON CIVIL AERONAUTICS ADMINISTRATION PROPOSAL NO. 802 AND ARE FOR THE ERECTION OF CERTAIN RADIO BUILDINGS AT THE WASHINGTON NATIONAL AIRPORT. A CONTRACT WITH SAMUEL ALPHER FOR THIS WORK, TOGETHER WITH THE UNSIGNED ORDER, IS ALSO ENCLOSED.

THIS PROPOSAL WAS FIRST ISSUED ON FEBRUARY 3, 1941, AND THE DATE SET FOR THE OPENING OF BIDS WAS FEBRUARY 28. THE PROPOSAL WAS POSTED AND SENT, ORIGINALLY, TO TWENTY PROSPECTIVE BIDDERS. NO BIDS WERE RECEIVED ON FEBRUARY 28, AND IN VIEW OF THE NEED FOR GETTING WORK STARTED PROMPTLY, THE PROPOSAL, BEARING THE SAME NUMBER, WAS REISSUED ON MARCH 1, FOR OPENING MARCH 5, AND WAS SENT TO FOUR ADDITIONAL CONTRACTORS WHO HAD NOT BEEN DIRECTLY SOLICITED IN THE FIRST ADVERTISEMENT, THE EXISTENCE OF THESE ADDITIONAL PROSPECTIVE BIDDERS NOT HAVING BEEN PREVIOUSLY KNOWN.

ON THE DAY OF THE SECOND OPENING, MARCH 5, IT APPEARED THAT ONLY TWO BIDS HAD BEEN RECEIVED, ONE FROM SAMUEL ALPHER AND THE OTHER FROM E. A. PESSAGNO COMPANY. SAMUEL ALPHER WAS THE LOW BIDDER, AND ON MARCH 6 THE CONTRACT WAS TRANSMITTED TO MR. ALPHER FOR EXECUTION. THE LETTER OF TRANSMITTAL, A COPY OF WHICH IS ENCLOSED, CONTAINED THE FOLLOWING STATEMENT: " YOUR BID ON PROPOSAL NO. 802 FOR THE ERECTION OF BUILDINGS AT THE WASHINGTON NATIONAL AIRPORT IS CONDITIONALLY ACCEPTED SUBJECT TO THE EXECUTION AND APPROVAL OF A FORMAL CONTRACT AND PERFORMANCE AND PAYMENT BONDS BY THE CIVIL AERONAUTICS ADMINISTRATION.' THE CONTRACT AND BONDS WERE DULY SIGNED AND RETURNED BY THE BIDDER. THE CONTRACT DID NOT, BY ITS TERMS, REQUIRE APPROVAL BY AN OFFICIAL OF THE GOVERNMENT TO MAKE IT EFFECTIVE; IT ONLY REQUIRED THAT IT BE EXECUTED, AND IT IS ASSUMED THAT THIS WOULD INCLUDE TRANSMITTAL TO THE CONTRACTOR.

ANOTHER PROPOSAL, NO. 806, HAD ALSO BEEN ISSUED BY THE CIVIL AERONAUTICS ADMINISTRATION WHICH WAS FOR OPENING ON MARCH 7, BUT THIS PROPOSAL HAD NO CONNECTION WITH THE WORK AT THE WASHINGTON NATIONAL AIRPORT. HOWEVER, WHEN THE BIDS ON PROPOSAL NO. 806 WERE OPENED, ONE OF THE ENVELOPES CONTAINED A BID FROM J. B. BOLLING ON PROPOSAL NO. 802, AND THE ENVELOPE IN WHICH THE BID WAS ENCLOSED WAS DULY MARKED AS A BID BY J. B. BOLLING ON PROPOSAL NO. 806 FOR THE BLACKSTONE WATCHHOUSE. THE ENVELOPE IS ENCLOSED HEREWITH.

THIS BID HAD NOT BEEN MAILED TO THE CIVIL AERONAUTICS ADMINISTRATION BUT WAS MERELY ENCLOSED IN THE ENVELOPE AND DELIVERED PERSONALLY LATE IN THE FORENOON OF MARCH 5, AND WAS PLACED WITH THE OTHER BIDS TO BE OPENED ON MARCH 7. THE BID OF J. B. BOLLING WAS THE LOWEST BID RECEIVED ON PROPOSAL 802 BY $1,685.10, AND INASMUCH AS THE PROPOSAL HAD INDICATED THAT THE GOVERNMENT DESIRED COMPLETION OF WORK IN 30 DAYS AND THAT BIDS QUOTING A TIME EXCESSIVE OF 30 DAYS WOULD BE EVALUATED FOR SUCH EXCESS TIME AT THE LIQUIDATED DAMAGE RATE, THE DIFFERENCE BETWEEN THE BID OF J. B. BOLLING AND THAT OF SAMUEL ALPHER, WHEN EVALUATED, IS $1,910.10.

YOUR ADVISE IS RESPECTFULLY REQUESTED AS TO WHETHER THE BID OF J. B. BOLLING IS FOR CONSIDERATION, AND IF NOT, WHETHER READVERTISEMENT IS PERMISSIBLE AND NECESSARY UNDER THE CIRCUMSTANCES, IN VIEW OF THE DIFFERENCE IN PRICES, THE URGENCY OF THE WORK, AND THE FACT THAT THE CONTRACT WITH SAMUEL ALPHER HAD ACTUALLY BEEN SIGNED AND THE ORDER WRITTEN, ALTHOUGH THE ORDER HAS NOT BEEN SIGNED AND NEITHER THE ORDER NOR THE SIGNED CONTRACT HAVE BEEN MAILED TO MR. ALPHER. THE GOVERNMENT HAS GIVEN MR. ALPHER NO OFFICIAL NOTICE, EITHER WRITTEN OR ORAL, THAT THE CONTRACT HAS BEEN EXECUTED ON BEHALF OF THE GOVERNMENT, BUT THE MATTER HAS BEEN HANDLED IN AN URGENT MANNER AND MR. ALPHER WAS FULLY AWARE OF OUR INTENTION TO SIGN IT WITHOUT DELAY.

IF IT SHOULD BE HELD THAT MR. BOLLING'S BID IS NOT ACCEPTABLE AND THAT THERE IS AS YET NO CONTRACT WITH SAMUEL ALPHER, AUTHORITY IS REQUESTED TO ISSUE THE CONTRACT AND ORDER TO MR. ALPHER, IF IN THE OPINION OF THE CIVIL AERONAUTICS ADMINISTRATION, READVERTISEMENT WOULD NOT BE IN THE PUBLIC INTEREST. THIS AUTHORITY IS REQUESTED BECAUSE BLIND LANDING RADIO EQUIPMENT WILL BE HOUSED IN THE BUILDINGS TO BE ERECTED UNDER THE CONTRACT AND AFTER COMPLETION OF THE BUILDINGS SOME TIME WILL BE REQUIRED TO INSTALL THE EQUIPMENT. IT IS EXPECTED THAT THE AIRPORT WILL BE OPENED ABOUT THE FIRST OF MAY, AND, IF POSSIBLE, THE BLIND LANDING EQUIPMENT SHOULD BE IN OPERATION BY THAT TIME. IT IS IMPORTANT ALSO, FOR THE SAME REASON, THAT YOUR DECISION BE FURNISHED AT THE EARLIEST POSSIBLE DATE.

WITH REFERENCE TO THE BID OF J. B. BOLLING, ATTENTION IS INVITED TO THE FACT THAT THE SURETY ON THE BID BOND IS NOT A CORPORATE SURETY, AND ONLY ONE INDIVIDUAL SURETY HAS BEEN FURNISHED. TWO RIDERS WEREISSUED ON THIS PROPOSAL IDENTIFIED AS RIDER NO. 1 OF FEBRUARY 15, AND RIDER NO. 2 OF FEBRUARY 26, MAKING CERTAIN CHANGES IN THE REQUIREMENTS. RIDER NO. 1 WAS NOT RETURNED BY MR. BOLLING, BUT RIDER NO. 2 WAS DULY SIGNED AND RETURNED WITH THE BID. MR. BOLLING DID NOT SIGN THE BID BOND AND DID NOT SIGN THE BIDDING FORM NO. 21 ON WHICH THE PRICES WERE QUOTED, AND THE ONLY PLACE HIS SIGNATURE APPEARS IS ON RIDER NO. 2. IN THE SCHEDULE OF ITEMS, THIS BIDDER MERELY QUOTED TOTAL PRICES ON ALL ITEMS, WHEREAS ON FOUR OF THE ITEMS IT WAS INTENDED THAT THE BIDDER SHOULD ALSO SPECIFY THE UNIT PRICES.

THE RETURN ENVELOPE WAS FURNISHED THE BIDDER BY THE GOVERNMENT AND THE OPENING DATE OF FEBRUARY 28 TYPED THEREON WAS DELETED IN PENCIL BY THE GOVERNMENT AND THE DATE MARCH 5, 1941, SUBSTITUTED. THUS, THE GOVERNMENT ERRONEOUSLY GAVE THE WRONG RETURN ENVELOPE FOR PROPOSAL 802 WITH THE CORRECT OPENING DATE BUT THE WRONG PROPOSAL NUMBER SHOWN THEREON. THE CHANGE FROM MARCH 5, 1941, TO MARCH 7, 1941, WAS MADE BY THE CONTRACTING OFFICE AT THE TIME THE BID WAS RECEIVED INASMUCH AS THE RETURN ENVELOPE INDICATED THAT IT CONTAINED A BID ON PROPOSAL 806 ON WHICH THE OPENING DATE HAD ACTUALLY BEEN POSTPONED FROM FEBRUARY 28 TO MARCH 7. A COPY OF PROPOSAL 806, TOGETHER WITH THE RIDER OF FEBRUARY 19 POSTPONING THE OPENING DATE TO MARCH 7 IS ENCLOSED HEREWITH.

IT IS REQUESTED THAT ALL ENCLOSURES BE RETURNED WITH YOUR DECISION.

IT APPEARS, WITH RESPECT TO THE BID SUBMITTED BY J. B. BOLLING, THAT IT WAS NOT PROPERLY MARKED TO INDICATE THE PROPOSAL TO WHICH IT PERTAINED, AND ALTHOUGH IN THE HANDS OF THE GOVERNMENT BEFORE THE TIME SET FOR OPENING PROPOSAL NO. 802 (2 P.M., MARCH 5, 1941), IT WAS NOT IN FACT OPENED AND ITS CONTENTS MADE KNOWN UNTIL MARCH 7, 1941. WHILE IT MAY BE THAT THE GOVERNMENT FURNISHED THE RETURN ENVELOPE ON WHICH THE ERRONEOUS PROPOSAL NUMBER AND DESIGNATION WERE INDICATED, PARAGRAPH 10, STANDARD FORM NO. 22," INSTRUCTIONS TO BIDDERS," REQUIRES THAT THE BID BE ADDRESSED AND MARKED AS REQUIRED BY THE INVITATION. ALSO, PARAGRAPH 11 INDICATES THAT NO RESPONSIBILITY WILL ATTACH TO AN OFFICER FOR THE PREMATURE OPENING OF A BID NOT PROPERLY ADDRESSED AND IDENTIFIED. NO REASON IS PERCEIVED FOR DISTINGUISHING BETWEEN AN EARLY AND A LATE OPENING OF A BID IN THIS RESPECT. IT MAY BE OBSERVED THAT THE BIDDING PAPERS SUBMITTED BY J. B. BOLLING CLEARLY REFER TO THE INVITATION AS " PROPOSAL 802" AND THAT PARAGRAPH A, SHEET NO. 2, OF THE BID FORM SHOWS THE MANNER IN WHICH THE BID IS TO BE ADDRESSED AND THAT IT SHOULD BE MARKED AS FOLLOWS:

BIDS FOR ERECTION OF BUILDING TO HOUSE EQUIPMENT FOR RADIO LANDING SYSTEM, WASHINGTON NATIONAL AIRPORT. PROPOSAL NO. 802. TO BE OPENED ON MAR. 5, 1941.

IT IS EVIDENT, THEREFORE, THAT AN INSPECTION OF THE ENVELOPE IN WHICH THE BIDDING PAPERS OF J. B. BOLLING WERE SUBMITTED WOULD HAVE INDICATED TO HIM THAT IT WAS NOT PROPERLY MARKED. CONSEQUENTLY, THE FACT THAT THE BID WAS OPENED LATE, AS A RESULT OF IMPROPER IDENTIFICATION, IS NOT A MATTER FOR WHICH THE GOVERNMENT IS REQUIRED TO ASSUME THE RESPONSIBILITY.

ASIDE FROM THAT, HOWEVER, THE BID FORM IS NOT SIGNED BY THE BIDDER; NOR IS THE BID BOND SIGNED EITHER BY THE PRINCIPAL OR SURETY, AND NO PENAL SUM IS STIPULATED THEREIN. WITHOUT CONSIDERING WHETHER THE GOVERNMENT MIGHT HAVE ALLOWED THE CORRECTION OF THESE DEFECTS AT THE REQUEST OF THE BIDDER AS A WAIVER OF INFORMALITIES, IT IS OBVIOUS THAT, IN ITS PRESENT STATE, THERE IS NOT PENDING BEFORE THE GOVERNMENT AN OFFER, THE ACCEPTANCE OF WHICH WOULD RESULT IN A CONTRACT WITH J. B. BOLLING, WITHOUT SOME FURTHER ACTION ON HIS PART.

WITH RESPECT TO THE BID OF SAMUEL ALPHER, IT IS TO BE OBSERVED THAT AT THE TIME OF OPENING THE BIDS IT WAS THE BONA FIDE LOW BID PENDING BEFORE THE GOVERNMENT. THIS BIDDER WAS INFORMED, BY LETTER OF MARCH 6, 1941, THAT HIS BID WAS CONDITIONALLY ACCEPTED, SUBJECT TO THE EXECUTION AND APPROVAL OF A FORMAL CONTRACT AND PERFORMANCE AND PAYMENT BONDS.

THE FORMAL CONTRACT AND BONDS WERE EXECUTED BY THE CONTRACTOR AND RETURNED TO THE ADMINISTRATION WHICH, APPARENTLY, HAS APPROVED THEM, BUT HAS NOT ADVISED MR. ALPHER OF THIS FACT NOR DELIVERED TO HIM AN EXECUTED COPY OF THE CONTRACT.

WHILE THE ACCEPTANCE OF MR. ALPHER'S BID IS STATED AS BEING CONDITIONAL, IT MAY BE NOTED THAT THOSE CONDITIONS ARE IN NO WAY AT VARIANCE WITH THE CONDITIONS OF HIS PROPOSAL, IN WHICH HE UNDERTAKES TO EXECUTE A FORMAL CONTRACT AND PERFORMANCE AND PAYMENT BONDS; BUT, REGARDLESS OF THIS, SUCH CONDITIONS HAVE BEEN MET, INSOFAR AS MR. ALPHER IS CONCERNED. THE SITUATION HERE DOES NOT APPEAR TO DIFFER, IN ANY ESSENTIAL, FROM THAT CONSIDERED IN UNITED STATES V. PURCELL ENVELOPE CO., 249 U.S. 313, IN WHICH THE COURT SAID:

IT MAKES NO DIFFERENCE THAT THE CONTRACT WAS NOT FORMALLY SIGNED OR THE BOND FORMALLY APPROVED, AS COUNSEL FOR THE GOVERNMENT CONTENDS THEY SHOULD HAVE BEEN, BOTH BY THE TERMS OF THE CONTRACT AND BY A STATUTE OF THE UNITED STATES (28 STAT. 279). THEIR FORMAL EXECUTION, AS WE HAVE SEEN, WAS NOT ESSENTIAL TO THE CONSUMMATION OF THE CONTRACT. THAT WAS ACCOMPLISHED, AS WAS DECIDED IN THE GARFIELDE CASE ( GARFIELDE V. UNITED STATES, 93 U.S. 242), BY THE ACCEPTANCE OF THE BID OF THE ENVELOPE COMPANY AND THE ENTRY OF THE ORDER AWARDING THE CONTRACT TO IT. * * * SEE, ALSO, AMERICAN SMELTING CO. V. UNITED STATES, 259 U.S. 75.

SINCE THE PROVISIONS OF SECTION 3744, REVISED STATUTES, 41 U.S.C. 16, DO NOT APPLY TO THE DEPARTMENT OF COMMERCE, IT IS NOT MATERIAL THAT A COPY OF THE EXECUTED FORMAL CONTRACT HAS NOT BEEN DELIVERED.

UNDER THE CIRCUMSTANCES, THEREFORE, IT WOULD APPEAR THAT A VALID AND BINDING CONTRACT EXISTS WITH SAMUEL ALPHER FOR THE WORK HERE INVOLVED; AND THAT THE INTERESTS OF THE GOVERNMENT DO NOT REQUIRE ANY ACTION TOWARD REVOCATION OF SUCH AWARD, WHICH MIGHT GIVE RISE TO A CLAIM AGAINST THE UNITED STATES FOR BREACH OF THE CONTRACT. SEE 17 COMP. GEN. 53. ACCORDINGLY, THIS OFFICE IS NOT REQUIRED TO OBJECT TO OTHERWISE PROPER PAYMENTS PURSUANT TO THE CONTRACT AS AWARDED TO SAMUEL ALPHER.