B-166580, JUN. 3, 1969

B-166580: Jun 3, 1969

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INC.: REFERENCE IS MADE TO YOUR LETTER OF MARCH 27. "SUBCONTRACTORS OPERATION TO BE PERFORMED * * * * * * * "THE USE OF ANY PRODUCING FACILITY OTHER THAN THOSE SPECIFIED HEREIN BY THE BIDDER IS PROHIBITED UNLESS PRIOR APPROVAL IS GRANTED BY THE CONTRACTING OFFICER. THE PLACE/S) OF PERFORMANCE SPECIFIED BY THE BIDDER WILL BECOME THE PLACE/S) OF INSPECTION BY THE GOVERNMENT.'. FOUR BIDS WERE RECEIVED IN RESPONSE TO THE INVITATION AND IT APPEARED THAT YOUR UNIT PRICE BID OF $162.29 WAS THE SECOND LOW BID AND THAT THE LOWEST BID OF $129.70 PER UNIT WAS RECEIVED FROM EAGLE-PICHER INDUSTRIES. IN YOUR LETTER OF MARCH 27 YOU MAINTAIN THAT EAGLE-PICHER'S BID IS "NONRESPONSIVE. YOU ARGUE THAT EAGLE-PICHER'S BID IS NONRESPONSIVE BECAUSE THAT BIDDER FAILED TO SUPPLY ANY INFORMATION AS TO SUBCONTRACTORS AND THEIR RELATED FUNCTIONS AS REQUESTED IN THE PLACE OF PERFORMANCE CLAUSE ON PAGE 9 OF THE INVITATION.

B-166580, JUN. 3, 1969

TO GOULD-NATIONAL BATTERIES, INC.:

REFERENCE IS MADE TO YOUR LETTER OF MARCH 27, 1969, PROTESTING THE PROPOSED AWARD OF A CONTRACT TO EAGLE-PICHER INDUSTRIES, INC., UNDER UNITED STATES MARINE CORPS INVITATION FOR BIDS M00150-69-B-0315.

THE INVITATION, ISSUED FEBRUARY 25, 1969, SOLICITED BIDS FOR THE PURCHASE OF 2,247 BB-451/U, SILVER-ZINC, RECHARGEABLE, TYPE II, CLASS 4, STORAGE BATTERIES. A CLAUSE AT PAGE 9 OF THE INVITATION, ENTITLED "PLACE/S) OF PERFORMANCE: ," PROVIDED, IN PERTINENT PART, AS FOLLOWS: "THE GOVERNMENT RESERVES THE RIGHT TO CONDUCT FULL INSPECTION HEREUNDER, INCLUDING INSPECTION OF MATERIAL PRODUCED, OR OPERATIONS PERFORMED BY SUBCONTRACTORS. ACCORDINGLY, BIDDERS MUST INDICATE BELOW, ALL SUBCONTRACTORS INVOLVED; THE TYPE OF OPERATION PERFORMED; THE PLACE OF SUCH ERFORMANCE; AND THE POINT OF FINAL PERFORMANCE HEREUNDER.

"SUBCONTRACTORS OPERATION TO BE PERFORMED

* * * * * * * "THE USE OF ANY PRODUCING FACILITY OTHER THAN THOSE SPECIFIED HEREIN BY THE BIDDER IS PROHIBITED UNLESS PRIOR APPROVAL IS GRANTED BY THE CONTRACTING OFFICER. "UNLESS OTHERWISE INDICATED HEREIN, THE PLACE/S) OF PERFORMANCE SPECIFIED BY THE BIDDER WILL BECOME THE PLACE/S) OF INSPECTION BY THE GOVERNMENT.'

SUBPARAGRAPH (B) OF THE CLAUSE ENTITLED "AFFILIATED BIDDERS," AT PAGE 12 OF THE INVITATION, REQUIRED BIDDERS TO SUBMIT WITH THEIR BIDS AN AFFIDAVIT CONTAINING, IN PART, THE FOLLOWING INFORMATION:

"/I) WHETHER THE BIDDER HAS ANY AFFILIATES

"/II) THE NAMES AND ADDRESSES OF ALL AFFILIATES OF THE BIDDER

"/III) THE NAMES AND ADDRESSES OF ALL PERSONS AND CONCERNS EXERCISING CONTROL OR OWNERSHIP OF THE BIDDER AND ANY OR ALL OF HIS AFFILIATES, AND WHETHER AS COMMON OFFENDERS, DIRECTORS, STOCKHOLDERS HOLDING CONTROLLING INTERESTS, OR OTHERWISE.' THAT CLAUSE CONCLUDED WITH THE ADMONITION THAT "FAILURE TO FURNISH SUCH AN AFFIDAVIT MAY RESULT IN REJECTION OF THE BID.'

FOUR BIDS WERE RECEIVED IN RESPONSE TO THE INVITATION AND IT APPEARED THAT YOUR UNIT PRICE BID OF $162.29 WAS THE SECOND LOW BID AND THAT THE LOWEST BID OF $129.70 PER UNIT WAS RECEIVED FROM EAGLE-PICHER INDUSTRIES, INC.

IN YOUR LETTER OF MARCH 27 YOU MAINTAIN THAT EAGLE-PICHER'S BID IS "NONRESPONSIVE, INCOMPLETE, IRREGULAR AND OTHERWISE FAILS TO SATISFY THE MANDATORY REQUIREMENTS OF THE SOLICITATION AND THE LAW.' SPECIFICALLY, YOU ARGUE THAT EAGLE-PICHER'S BID IS NONRESPONSIVE BECAUSE THAT BIDDER FAILED TO SUPPLY ANY INFORMATION AS TO SUBCONTRACTORS AND THEIR RELATED FUNCTIONS AS REQUESTED IN THE PLACE OF PERFORMANCE CLAUSE ON PAGE 9 OF THE INVITATION, AND BECAUSE IT FAILED TO FURNISH AN AFFIDAVIT OF AFFILIATION WITH OTHER CONCERNS REQUIRED BY THE AFFILIATED BIDDERS CLAUSE ON PAGE 12 OF THE INVITATION. MOREOVER, YOU POINT OUT THAT EAGLE-PICHER, BY STATING "NONE" OPPOSITE SUBPARAGRAPH (B) (I) OF THE CLAUSE ON PAGE 12, SUPRA, INDICATED THAT IT HAD NO AFFILIATES, WHEREAS, IN FACT, IT IS COMMON KNOWLEDGE THAT EAGLE-PICHER HAS AT LEAST SEVERAL SUBSIDIARIES AND AFFILIATES.

AS TO YOUR FIRST CONTENTION THAT EAGLE-PICHER'S BID IS NONRESPONSIVE BY REASON OF ITS FAILURE TO SUPPLY A LIST OF SUBCONTRACTORS REQUIRED BY THE CLAUSE ON PAGE 9 OF THE INVITATION, THE CLEAR LANGUAGE OF THAT CLAUSE ONLY REQUIRES THE LISTING OF SUBCONTRACTORS IF, IN FACT, THE BIDDER INTENDS TO SUBCONTRACT ALL OR ANY PORTION OF THE WORK THEREUNDER. EAGLE-PICHER REPLIED TO THAT CLAUSE BY INSERTING THE TYPEWRITTEN WORD "NONE" IN TWO PLACES UNDER THE HEADING "OPERATION TO BE PERFORMED.' SINCE THE SOLE PURPOSE FOR THE INFORMATION REQUESTED THEREUNDER WAS TO ENABLE THE CONTRACTING OFFICIALS TO ADMINISTRATIVELY PLAN THE INSPECTION OF MATERIAL AND OPERATIONS PERFORMED AT THE PRIME AND SUBCONTRACTOR LEVEL, AND, AS EAGLE-PICHER CLEARLY INDICATED IN ITS BID THAT NO SUBCONTRACTING IS CONTEMPLATED, NOTHING FURTHER WAS REQUIRED OF THAT BIDDER WITH REFERENCE TO THAT CLAUSE. COMPARE, 47 COMP. GEN. 644 WHERE A CONSTRUCTION INVITATION REQUIRED IN MANDATORY TERMS THE LISTING OF SUBCONTRACTORS AS AN ELEMENT OF RESPONSIVENESS. WE NOTE, IN THIS REGARD, THAT THERE CAN BE NO QUESTION AS TO THE PLACE OF INSPECTION OF THE WORK TO BE PERFORMED BY THE PRIME CONTRACTOR BECAUSE THE LAST SENTENCE OF THE CLAUSE ON PAGE 9 SPECIFIES THAT, UNLESS OTHERWISE STATED, THE INDICATED PLACE OF PERFORMANCE WILL BECOME THE PLACE OF INSPECTION. MOREOVER, SUBPARAGRAPH "B" OF THE CLAUSE ON PAGE 5, ENTITLED "SHIPPING POINT/S) USED IN EVALUATION OF F.O.B. ORIGIN BIDS," PROVIDES THAT IF THE BIDDER FAILS TO INDICATE IN ITS BID, AS HERE, THE PLACE OF PERFORMANCE, THE BID WILL BE EVALUATED ON THE BASIS OF DELIVERY FROM THE CONTRACTOR'S BUSINESS ADDRESS STATED ON THE FACESHEET OF THE INVITATION, WHICH, IN THIS CASE, IS "EAGLE PICHER INDUSTRIES, INC., C AND PORTER STREETS, JOPLIN, JASPER CO., MISSOURI 64801.' WE BELIEVE THAT THE PROCEDURE ENUNCIATED IN SUCH CLAUSE TO ESTABLISH THE PLACE OF PERFORMANCE BY REFERENCE TO THE BIDDER'S BUSINESS ADDRESS MAY BE USED TO DETERMINE THE PLACE OF PERFORMANCE FOR INSPECTION PURPOSES ESPECIALLY SINCE THE PLACE OF INSPECTION IS SUBJECT TO CHANGE AFTER AWARD IF APPROVED BY THE CONTRACTING OFFICER.

EAGLE-PICHER'S FAILURE TO FURNISH WITH ITS BID A LIST OF AFFILIATES, AS REQUIRED BY THE INVITATION, IS A MINOR INFORMALITY WHICH IS PROPER FOR WAIVER IN APPROPRIATE CIRCUMSTANCES. IN THIS RESPECT PARAGRAPH 2 405 OF THE ARMED SERVICES PROCUREMENT REGULATION PROVIDES, IN PERTINENT PART, AS FOLLOWS: "A MINOR INFORMALITY OR IRREGULARITY IS ONE WHICH IS MERELY A MATTER OF FORM OR IS SOME IMMATERIAL VARIATION FROM THE EXACT REQUIREMENTS OF THE INVITATION FOR BIDS, HAVING NO EFFECT OR MERELY A TRIVIAL OR NEGLIGIBLE EFFECT ON PRICE, AND NO EFFECT ON QUALITY, QUANTITY, OR DELIVERY OF THE SUPPLIES OR PERFORMANCE OF THE SERVICES BEING PROCURED, AND THE CORRECTION OR WAIVER OF WHICH WOULD NOT AFFECT THE RELATIVE STANDING OF, OR BE OTHERWISE PREJUDICIAL TO, BIDDERS. THE CONTRACTING OFFICER SHALL EITHER GIVE TO THE BIDDER AN OPPORTUNITY TO CURE ANY DEFICIENCY RESULTING FROM AIMONOR INFORMALITY OR IRREGULARITY IN A BID, OR WAIVE ANY SUCH DEFICIENCY WHERE IT IS TO THE ADVANTAGE OF THE GOVERNMENT. EXAMPLES OF MINOR INFORMALITIES OR IRREGULARITIES INCLUDE:

"/V) FAILURE TO FURNISH AN AFFIDAVIT CONCERNING AFFILIATES, IF REQUIRED PURSUANT TO 2-201 (A) (XXIII).'

IN OTHER WORDS, UNLESS THE CONTRACTING OFFICIALS HAVE REASON TO BELIEVE THAT AN AFFIDAVIT LISTING A PARTICULAR BIDDER'S AFFILIATES WOULD DISCLOSE THE EXISTENCE OF POSSIBLE IRREGULARITIES IN BIDDING, SUCH AS MULTIPLE BIDDING, NO USEFUL PURPOSE WOULD BE SERVED BY RELATING THAT INFORMATION TO THE RESPONSIVENESS OF THE BID AND REQUIRING THAT SUCH AN AFFIDAVIT BE SUPPLIED WITH EACH BID AT THE TIME OF BID OPENING. AS STATED AT 39 COMP. GEN. 881, 883:

"* * * WE HAVE ADHERED TO THE VIEW THAT WHERE INFORMATION IS CALLED FOR TO DETERMINE THE RESPONSIBILITY OF THE BIDDER RATHER THAN THE RESPONSIVENESS OF THE BID, SUCH INFORMATION MAY BE PROVIDED SUBSEQUENT TO BID OPENING. SEE B-142350, MARCH 30, 1960, 39 COMP. GEN. 655. THE REPORTED FACTS INDICATE THAT THE PURPOSE OF THE REQUIRED AFFIDAVIT IN THIS CASE WAS TO ASSIST THE CONTRACTING OFFICER IN DETERMINING THE RESPONSIBILITY OF THE BIDDER RATHER THAN THE RESPONSIVENESS OF THE BID.

"IN THE CIRCUMSTANCES, WE CONCLUDE THAT THE FAILURE TO SUBMIT THE AFFIDAVIT IN QUESTION PRIOR TO BID OPENING MAY BE WAIVED AND THE CONTRACT MAY BE AWARDED TO THE QUILLER CONSTRUCTION COMPANY, INC., IF OTHERWISE PROPER, NOTWITHSTANDING THE STATEMENT IN THE INVITATION THAT SUCH FAILURE WILL RESULT IN REJECTION OF A BID.'

WE HAVE BEEN INFORMALLY ADVISED BY EAGLE-PICHER THAT IT INTERPRETED THE "AFFILIATED BIDDERS" CLAUSE TO REQUIRE THE LISTING OF ONLY THOSE OF ITS AFFILIATES WHICH WOULD BE ACTIVELY INVOLVED IN THE PROCUREMENT AND THAT, SINCE NONE WOULD BE SO INVOLVED, IT DID NOT LIST ANY OF ITS AFFILIATES. HOWEVER, WE DO NOT AGREE THAT THE CLAUSE IS SUSCEPTIBLE OF SUCH AN INTERPRETATION SINCE IT REQUIRES THE LISTING OF ALL AFFILIATES WITHOUT EXCEPTION. UNDER THE ABOVE-STATED RULE, SUCH FAILURE TO LIST ALL AFFILIATES WAS NOT FATAL TO THE BID AND THE INFORMATION, RELATING AS IT DOES TO RESPONSIBILITY, COULD HAVE BEEN WAIVED AFTER BID OPENING PURSUANT TO ASPR 2-405.

IN THE CIRCUMSTANCES, WE CONCLUDE THAT EAGLE-PICHER'S FAILURE TO SUBMIT THE INFORMATION DISCUSSED ABOVE WITH ITS BID PRIOR TO BID OPENING MAY BE WAIVED AND ITS BID PROPERLY MAY BE CONSIDERED FOR AWARD. IN ARRIVING AT THIS CONCLUSION WE HAVE THOROUGHLY CONSIDERED THE DECISIONS OF OUR OFFICE CITED BY YOU IN YOUR LETTER OF MARCH 27, BUT THEY ARE NOT APPLICABLE TO THE CIRCUMSTANCES OF THIS CASE WHEREIN THE DEVIATIONS ARE OF FORM AND NOT OF SUBSTANCE. CF. 47 COMP. GEN. 624.