B-164851, OCT. 17, 1968

B-164851, OCT. 17, 1968

TO MR. SECRETARY:

REFERENCE IS MADE TO LETTER AFSPPCA, DATED AUGUST 21, 1968, WITH ENCLOSURES, FROM THE CHIEF, PROCUREMENT AND OPERATIONS DIVISION, DIR/PROCUREMENT POLICY, DCS/S-AND-L, REPORTING ON THE PROTEST OF THE H.C. HODGES LUMBER COMPANY, INC., AGAINST THE AWARD OF A CONTRACT TO ANY BIDDER OTHER THAN ITSELF UNDER INVITATION FOR BIDS F08651-68-B 0256, ISSUED BY EGLIN AIR FORCE BASE, FLORIDA.

THE INVITATION, DATED MAY 24, 1968, SOLICITED BIDS FOR THE SALE OF APPROXIMATELY 20 MILLION BOARD FEET OF SURPLUS STANDING SOUTHERN PINE SAWTIMBER AND THE LEASE OF A GOVERNMENT-OWNED SAWMILL, OVER A 5 - YEAR PERIOD. PAGE 2 OF THE SALES INVITATION WHICH WAS TO BE COMPLETED BY THE BIDDERS PROVIDES IN PART AS FOLLOWS:

"* * * THE UNDERSIGNED OFFERS AND AGREES (AS SET FORTH IN CONDITION NO. 3 OF STANDARD FORM 114-C), IF THIS BID BE ACCEPTED WITHIN ----- CALENDAR DAYS (60 CALENDAR DAYS IF NO PERIOD BE SPECIFIED BY THE GOVERNMENT OR BY THE BIDDER, BUT NOT LESS THAN 10 CALENDAR DAYS IN ANY CASE) AFTER DATE OF BID OPENING, TO PURCHASE AND PAY FOR ANY OR ALL OF THE ITEMS OR LOTS OF PROPERTY LISTED IN THE ATTACHED ITEM BID * * *.'

PARAGRAPH NO. 3 OF STANDARD FORM 114-C, THE GENERAL SALE TERMS AND CONDITIONS, REFERENCED ABOVE, PRECLUDES THE BIDDER FROM WITHDRAWING HIS BID WITHIN THE SPECIFIED TIME PERIOD AFTER BID OPENING AND PROVIDES THAT IF NO LIMITATION IS SPECIFIED BY THE GOVERNMENT OR THE BIDDER, THE PERIOD WILL BE AT LEAST 60 DAYS BUT NOT LESS THAN 10 DAYS IN ANY EVENT, AND THAT DURING SUCH PERIOD THE OFFERED BID PRICE WILL REMAIN FIRM AND IRREVOCABLE. WITH FURTHER REGARD TO THE TWO ABOVE PROVISIONS OF THE INVITATION, ARTICLE 31 OF THE SPECIAL CONDITIONS ENTITLED,"BID ACCEPTANCE PERIOD (APRIL 1960)" STATES THAT:

"BIDS OFFERING LESS THAN SIXTY (60) DAYS FOR ACCEPTANCE BY THE GOVERNMENT FROM THE DATE SET FOR OPENING OF BIDS WILL BE CONSIDERED NONRESPONSIVE AND WILL BE REJECTED.'

TWO BIDS WERE RECEIVED IN RESPONSE TO THE INVITATION AND OPENED AS SCHEDULED ON JULY 2, 1968. BAY LUMBER COMPANY, INC., SUBMITTED THE HIGH AGGREGATE BID IN THE AMOUNT OF $800,000; HOWEVER, BAY SPECIFIED ON PAGE 2 OF THE INVITATION THAT ITS BID MUST BE ACCEPTED WITHIN 30 CALENDAR DAYS AFTER BID OPENING. THE OTHER BID WAS RECEIVED FROM H.C. HODGES LUMBER CO., INC., IN THE TOTAL AMOUNT OF $776,000.

BY LETTER OF JULY 3, 1968, ADDRESSED TO THE CONTRACTING OFFICER, BAY CONTENDED THAT THE 30 - DAY ACCEPTANCE PERIOD STATED IN ITS BID WAS, AT MOST, A TECHNICAL DEFECT WHICH SHOULD BE WAIVED BY THE CONTRACTING OFFICER SINCE THE INVITATION MISLED IT INTO BELIEVING THAT IT COULD LIMIT THE BID ACCEPTANCE PERIOD TO ANY NUMBER OF DAYS BETWEEN 10 AND 60. IN ADDITION, BAY POINTS OUT THAT THE STATEMENT IN PARAGRAPH 6 OF THE GENERAL INFORMATION AND INSTRUCTIONS THAT INFORMATION CONCERNING AWARDS FURNISHED TO UNSUCCESSFUL BIDDERS WOULD NOT BE AVAILABLE UNTIL 30 DAYS AFTER BID OPENING IMPLIED THAT "AWARD MIGHT WELL BE MADE AT THAT TIME.'

HOWEVER, THE CONTRACTING OFFICER CONCLUDED THAT THE 30 - DAY ACCEPTANCE LIMITATION IN BAY'S BID WAS NOT A MINOR IRREGULARITY WHICH COULD BE WAIVED UNDER THE PROVISION OF ARMED SERVICES PROCUREMENT REGULATION (ASPR) 2-405, AND THAT THE INVITATION WAS NOT AMBIGUOUS OR INADEQUATE TO SUPPORT AN AWARD BECAUSE THE PLACEMENT OF ARTICLE 31 ON PAGE 22 OF THE INVITATION AS THE FINAL SPECIAL CONDITION MADE THAT ARTICLE DIFFICULT TO OVERLOOK. ADDITIONALLY, IN A MEMO TO PROSPECTIVE BIDDERS, ATTACHED TO THE INVITATION, ALL BIDDERS WERE SPECIFICALLY CAUTIONED TO READ AND COMPLETE THEIR BIDS PROPERLY. BAY'S ARGUMENT THAT IT HAD BEEN MISLED BY THE STATEMENT THAT AWARD INFORMATION WOULD NOT BE AVAILABLE FOR 30 DAYS AFTER OPENING WAS DETERMINED TO BE WITHOUT MERIT SINCE THAT PERIOD RELATED TO THE EVALUATION OF BIDS AND HAD NO REFERENCE TO THE PERIOD FOR BID ACCEPTANCE.

BY LETTER DATED JULY 12, 1968, AND SUBSEQUENT CORRESPONDENCE, HODGES ARGUED THAT BAY'S BID WAS CLEARLY NONRESPONSIVE TO THE BIDDING TERMS OF THE INVITATION AND PROTESTED ANY ADMINISTRATIVE ACTIONS WHICH MIGHT POSSIBLY BE UNDERTAKEN BY THE CONTRACTING OFFICIALS TO PERMIT BAY TO CORRECT ITS BID, TO WAIVE THE DEFECT, OR TO CANCEL THE INVITATION AND READVERTISE THE SALE.

THE ADMINISTRATIVE REPORT OF AUGUST 21 AGREED THAT BAY'S BID WAS NONRESPONSIVE AND CONCLUDED WITH A RECOMMENDATION THAT THE INVITATION BE CANCELLED ON THE GROUNDS THAT IT WOULD BE IN THE BEST INTEREST OF THE GOVERNMENT TO READVERTISE THE SALE SINCE BAY'S OFFERED PRICE WAS $24,000 HIGHER THAN HODGES-, AND BECAUSE THE INADVERTENT QUALIFICATION IN BAY'S BID WAS IN PART CAUSED BY THE FAILURE OF THE CONTRACTING OFFICIALS TO CLEARLY CROSS-REFERENCE THE PROVISIONS OF THE INVITATION GOVERNING THE BID ACCEPTANCE PERIOD. IN SUPPORT OF THE LATTER REASON ADVANCED FOR CANCELLATION, THE REPORT MAKES REFERENCE TO THE STATEMENT IN OUR LETTER B- 154793, SEPTEMBER 21, 1964, TRANSMITTING A COPY OF OUR DECISION IN AN ANALAGOUS CASE TO THE SECRETARY OF THE AIR FORCE. IN THAT LETTER WE SUGGESTED THAT WHEN INVITATIONS CONTAIN LANGUAGE SIMILAR TO THAT USED ON PAGE 2 OF THE INSTANT INVITATION SPECIFYING THE BID ACCEPTANCE PERIOD AND A SEPARATE PROVISION LOCATED ELSEWHERE IN THE INVITATION SETS FORTH A MINIMUM BID ACCEPTANCE PERIOD, THE TWO PROVISIONS SHOULD BE CROSS- REFERENCED. IN ANOTHER SIMILAR CASE, B 160252, NOVEMBER 18, 1966, WE SUGGESTED TO THE SECRETARY OF THE NAVY THAT SUCH CROSS-REFERENCE SHOULD BE SUCCINCT AND CLEAR IN ORDER TO AVOID THE POSSIBLE MISINTERPRETATION OF THE PROVISIONS OF THE INVITATION.

AS IN THE CASE OF THE PROCUREMENT OF SUPPLIES AND SERVICES BY THE MILITARY AGENCIES PURSUANT TO THE STATUTORY REQUIREMENTS GOVERNING FORMAL ADVERTISING, THE STATUTE GOVERNING THE DISPOSITION OF SURPLUS GOVERNMENT PROPERTY, 40 U.S.C. 484, REQUIRES THAT ADVERTISEMENTS PERMIT FULL AND FREE COMPETITION CONSISTENT WITH THE VALUE AND NATURE OF THE PROPERTY, AND THAT AN AWARD BE MADE ONLY TO THE RESPONSIBLE BIDDER WHOSE BID, CONFORMING TO THE INVITATION FOR BIDS, WILL BE MOST ADVANTAGEOUS TO THE GOVERNMENT, PRICE AND OTHER FACTORS CONSIDERED.

IT IS WELL ESTABLISHED THAT A PROVISION IN AN INVITATION WHICH REQUIRES THAT A BID MUST REMAIN AVAILABLE FOR ACCEPTANCE BY THE GOVERNMENT FOR A SPECIFIED PERIOD OF TIME IN ORDER TO BE CONSIDERED FOR AWARD IS A MATERIAL REQUIREMENT, AND THAT FAILURE TO MEET SUCH REQUIREMENT RENDERS A BID NONRESPONSIVE. 46 COMP. GEN. 418, 39 ID., 779. THE FACT THAT SUCH FAILURE MAY BE ATTRIBUTABLE TO OVERSIGHT OR ERROR DOES NOT JUSTIFY CORRECTION OF THE BID TO REMEDY THE DEFECT. BIDS MUST CONFORM TO THE ADVERTISED REQUIREMENTS IN ORDER TO BE ACCEPTABLE. MISTAKES IN BIDS MAY NOT BE CORRECTED TO MAKE A NONCONFORMING BID RESPONSIVE. ASPR 2-405 PROVIDES, IN THIS REGARD, THAT ONLY MINOR IRREGULARITIES OR INFORMALITIES IN BIDS WHICH HAVE NO EFFECT ON PRICE, QUALITY, QUANTITY OR DELIVERY ARE PROPER FOR CORRECTION OR WAIVER IF SUCH ACTION WOULD BE TO THE ADVANTAGE OF THE GOVERNMENT. WHILE THE CITED REGULATION DEALS WITH THE PROCUREMENT OF SUPPLIES AND SERVICES, IT IS EQUALLY APPLICABLE IN A SURPLUS SALES DISPOSAL BECAUSE, AS POINTED OUT ABOVE, THE STATUTORY AUTHORITY FOR A SALE IS SIMILAR TO THE STATUTORY AUTHORITY GOVERNING THE PROCUREMENT OF SUPPLIES AND SERVICES BY FORMAL ADVERTISING. 46 COMP. GEN. 326, 329-330; 39 ID. 617. IT IS THEREFORE CLEAR THAT BAY'S BID WAS NONRESPONSIVE TO THE INVITATION FOR BIDS AND, AS SUCH, MAY NOT BE CORRECTED TO MAKE IT ELIGIBLE FOR CONSIDERATION FOR AWARD.

THERE REMAINS FOR DETERMINATION THE QUESTION WHETHER THE INVITATION PROPERLY SHOULD BE CANCELLED AS RECOMMENDED IN THE REPORT OF AUGUST 21.

WHILE WE THINK OUR SUGGESTIONS PREVIOUSLY MADE THAT INVITATION PROVISIONS SUCH AS INVOLVED HERE SHOULD BE ADEQUATELY CROSS-REFERENCED IN ORDER TO AVOID POSSIBLE MISINTERPRETATIONS WERE VALID, THE FACT THAT THE FORMAT OF AN INVITATION CAN BE CLARIFIED OR IMPROVED UPON DOES NOT REQUIRE OR NECESSARILY PERMIT THE CONCLUSION THAT THE INVITATION IS DEFECTIVE BECAUSE OF AMBIGUITY. IN FACT, WE ARE OF THE OPINION THAT READ AS A WHOLE THE INVITATION HERE IN QUESTION IS NOT AMBIGUOUS. IT IS ALSO OUR VIEW THAT A BIDDER SHOULD BE FAMILIAR WITH ALL OF THE PROVISIONS OF AN INVITATION BEFORE SUBMITTING HIS BID.

OUR OFFICE HAS HELD ON NUMEROUS OCCASIONS THAT THE MAINTENANCE OF THE COMPETITIVE BIDDING SYSTEM IS OF FAR GREATER VALUE TO THE GOVERNMENT THAN THE POSSIBLE GAINING OF A MONETARY ADVANTAGE IN AN INDIVIDUAL INSTANCE. 35 COMP. GEN. 33. IN ADDITION TO THE FACT THAT THE INVITATION IN THIS CASE CLEARLY SPECIFIED THE BID-ACCEPTANCE PERIOD, WE NOTE THAT ONLY TWO BIDS WERE RECEIVED UNDER THE INVITATION AND THERE IS NO INDICATION THAT ADDITIONAL RESPONSES WOULD BE ELICITED ON A READVERTISEMENT. THEREFORE, THE ONLY PURPOSE THAT WOULD BE SERVED BY A CANCELLATION AND READVERTISEMENT WOULD BE TO GIVE BAY, THE INCUMBENT CONTRACTOR, A SECOND OPPORTUNITY TO SUBMIT A RESPONSIVE BID AFTER THE BID PRICES UNDER THE FIRST INVITATION HAVE BEEN DISCLOSED. IN THESE CIRCUMSTANCES WE REASONABLY CANNOT CONCLUDE THAT COMPELLING OR COGENT REASONS EXIST TO SUPPORT READVERTISEMENT.

WE NOTE, IN ADDITION, THAT BOTH OF THE RESPONDING BIDDERS HERE HAVE SUBMITTED BIDS IN THE PAST IN RESPONSE TO INVITATIONS FOR THE SALE AND LEASE OF THE SAME SUBJECT MATTER AS DESCRIBED IN THE PRESENT INVITATION, AND ARE THEREFORE NOT UNFAMILIAR WITH THE MECHANICS OF PREPARING AND SUBMITTING BIDS OF THIS NATURE.

ACCORDINGLY, IF OTHERWISE PROPER, AWARD SHOULD BE MADE UNDER THE PRESENT INVITATION TO THE HIGHEST RESPONSIVE, RESPONSIBLE BIDDER.

WE REITERATE OUR SUGGESTION THAT IN CASES SUCH AS THIS PROVISIONS DEALING WITH THE SAME REQUIREMENTS OR CONDITIONS SHOULD BE CROSS REFERENCED.