B-164805, JUL. 26, 1968

B-164805: Jul 26, 1968

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WHICH WAS DISALLOWED BY OUR CLAIMS DIVISION BY LETTER OF JUNE 17. THAT CONTRACT WAS CANCELLED ON THE BASIS THAT AWARD TO YOUR COMPANY WAS INVALID AND BEYOND THE AUTHORITY OF THE CONTRACTING OFFICER BECAUSE YOUR BID WAS NOT RESPONSIVE TO THE INVITATION. RECONSIDERATION OF YOUR CLAIM IS REQUESTED UPON TWO PREMISES. THAT YOU IMMEDIATELY OFFERED TO CORRECT THE DEFICIENCIES IN YOUR PRODUCT AS SOON AS YOU WERE NOTIFIED OF THEM. THAT THE GOVERNMENT SHOULD NOT CANCEL A CONTRACT WHENEVER IT PLEASES MEMERRELY A CONTRACT AS AWARDED WAS UNAUTHORIZED. YOU FEEL IS PROVIDED FOR BY THE PHRASE "OTHER FACTORS CONSIDERED" IN 10 U.S.C. 2305 (C). THAT SECTION CONTEMPLATES AWARD WILL BE MADE TO THE LOW BIDDER WHOSE BID CONFORMS TO THE REQUIREMENTS OF THE INVITATION. 37 COMP.

B-164805, JUL. 26, 1968

TO PHILLIPS MANUFACTURING COMPANY:

WE REFER TO YOUR LETTER DATED JUNE 24, 1968, REQUESTING RECONSIDERATION OF YOUR CLAIM FOR $1,250.00, WHICH WAS DISALLOWED BY OUR CLAIMS DIVISION BY LETTER OF JUNE 17, 1968. THIS CLAIM REPRESENTS COSTS INCURRED IN PREPARING TO PERFORM UNDER CONTRACT N00600-67-C-1120 WITH DEPARTMENT OF THE NAVY PRIOR TO THE CANCELLATION OF THAT CONTRACT ON MAY 23, 1967. THAT CONTRACT WAS CANCELLED ON THE BASIS THAT AWARD TO YOUR COMPANY WAS INVALID AND BEYOND THE AUTHORITY OF THE CONTRACTING OFFICER BECAUSE YOUR BID WAS NOT RESPONSIVE TO THE INVITATION. THE FIGURE $1,250.00 REPRESENTS THE COSTS FOR ENGINEERING MANHOURS EXPENDED DURING THE 18-DAY PERIOD BETWEEN AWARD AND CANCELLATION. RECONSIDERATION OF YOUR CLAIM IS REQUESTED UPON TWO PREMISES, FIRST, THAT YOU IMMEDIATELY OFFERED TO CORRECT THE DEFICIENCIES IN YOUR PRODUCT AS SOON AS YOU WERE NOTIFIED OF THEM, AND SECOND, THAT THE GOVERNMENT SHOULD NOT CANCEL A CONTRACT WHENEVER IT PLEASES MEMERRELY A CONTRACT AS AWARDED WAS UNAUTHORIZED.

WHEN INFORMED OF THE CANCELLATION AND THE REASONS THEREFORE, YOUR COMPANY NOTIFIED THE CONTRACTING OFFICER AT ONCE THAT YOU WOULD MODIFY YOUR PRODUCT SO AS TO CONFORM TO THE REQUIREMENTS IN THE INVITATION. SUCH AN ALTERATION OF YOUR PROPOSAL, AFTER OPENING AND AWARD, YOU FEEL IS PROVIDED FOR BY THE PHRASE "OTHER FACTORS CONSIDERED" IN 10 U.S.C. 2305 (C). THAT PHRASE DID NOT BROADEN THE SCOPE OF AUTHORITY EXISTING PRIOR TO ITS ENACTMENT NOR DID IT INTRODUCE NEW FACTORS INTO THE EVALUATION OF BIDS SUBMITTED IN RESPONSE TO ADVERTISED PROCUREMENTS. 37 COMP. GEN. 550, 552. RATHER, THAT SECTION CONTEMPLATES AWARD WILL BE MADE TO THE LOW BIDDER WHOSE BID CONFORMS TO THE REQUIREMENTS OF THE INVITATION. 37 COMP. GEN. 330; 28 ID. 662. IT DOES NOT PROVIDE ANY AUTHORITY FOR MODIFICATION OF A CONTRACT ONCE AWARDED AND DOES NOT CHANGE THE WELL-SETTLED RULE THAT THE CONTRACT TO BE AWARDED MUST BE THE CONTRACT SUBMITTED TO ALL BIDDERS. 38 COMP. GEN. 131. TO PERMIT AWARD OF A CONTRACT ON A BASIS OTHER THAN THAT PROVIDED IN THE INVITATION WOULD DENY THE GOVERNMENT THE BENEFITS OF A COMPETITION WHICH 10 U.S.C. 2305 SEEKS TO PRESERVE.

YOUR OFFER TO CORRECT THE DEVIATIONS IN YOUR PROPOSAL COULD NOT RETROACTIVELY VALIDATE AN IMPROPER AWARD. SEE PRESTEX, INC. V UNITED STATES, 162 CT. CL. 620. AS WE STATED IN 46 COMP. GEN. 348, AT 349:

"WE RECOGNIZE THAT IT MAY APPEAR UNDULY HARSH TO REQUIRE A CONTRACTOR WHO ACTED IN GOOD FAITH TO ABSORB THE COSTS * * *. HOWEVER, THE UNITED STATES HAS POWER TO ACT ONLY THROUGH ITS AGENTS WHOSE AUTHORITY, AND THE MANNER OF EXERCISE THEREOF, IS PRESCRIBED AND LIMITED BY STATUTE, REGULATION, AND ADMINISTRATIVE AND JUDICIAL DETERMINATION. TO MAKE THE GOVERNMENT LIABLE FOR OTHER THAN BENEFITS RECEIVED WOULD, IN EFFECT, PERMIT AGENTS OF THE GOVERNMENT TO OBLIGATE THE UNITED STATES IN DIRECT CONTRAVENTION OF THOSE LIMITATIONS AND PRESCRIPTION. IN EFFECT, THE BASIC PURPOSES OF THE STATUTES, REGULATIONS AND DETERMINATIONS WOULD BE NULLIFIED. SUCH RESULT IS OPPOSED TO THE PUBLIC INTEREST.'

ACCORDINGLY, FOR THE ABOVE REASONS, THE DISALLOWANCE OF YOUR CLAIM MUST BE SUSTAINED.