B-168055(1), NOV. 26, 1969

B-168055(1): Nov 26, 1969

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SIGNATURES CONTRACT AWARD TO LOW BIDDER (IN RECEIVERSHIP WHEN BID WAS SUBMITTED) IS AFFIRMED. RECEIVER WAS OBLIGATED TO FURNISH PERFORMANCE BOND WHEN GOVT. ALEXANDER BOSKOFF: FURTHER REFERENCE IS MADE TO YOUR LETTER DATED OCTOBER 6. FIVE BIDS WERE RECEIVED. WAS SUBMITTED BY BALDWIN AND THE NEXT LOWEST. WAS SUBMITTED BY THE SQUARE DEAL TRUCKING COMPANY. THE LOW BID WAS SIGNED BY MR. THE COMPANY WAS IN RECEIVERSHIP WHEN THE BID WAS SUBMITTED. EVIDENCE OF HIS AUTHORITY TO DO SO WAS NOT SUBMITTED WITH THE BALDWIN TRASH COMPANY'S BID. AS WAS REQUIRED IN THAT PART OF STANDARD FORM 33A WHICH STATES THAT OFFERS SIGNED BY AN AGENT ARE TO BE ACCOMPANIED BY EVIDENCE OF HIS AUTHORITY UNLESS SUCH EVIDENCE HAS BEEN PREVIOUSLY FURNISHED TO THE ISSUING OFFICE.

B-168055(1), NOV. 26, 1969

AGENTS--OF PRIVATE PARTIES--AUTHORITY--SIGNATURES CONTRACT AWARD TO LOW BIDDER (IN RECEIVERSHIP WHEN BID WAS SUBMITTED) IS AFFIRMED, AS U.S. DISTRICT COURT, IN APPOINTING RECEIVER, DID NOT EXPECT HIM TO DISCONTINUE BIDDING ON GOVT. CONTRACTS FOR SERVICES TO BE PERFORMED DURING PERIODS NOT EXCEEDING 1 YEAR; NOTHING IN COURT ORDER JUSTIFIES CONCLUSION THAT RECEIVER COULD NOT DELEGATE AUTHORITY TO BID ON GOVT. CONTRACTS TO FIRM OFFICER; RECEIVER WAS OBLIGATED TO FURNISH PERFORMANCE BOND WHEN GOVT. DETERMINED AWARD SHOULD BE MADE TO LOW BIDDER ON BASIS OF BID SIGNED BY ITS PRESIDENT; AND PRESIDENT'S FAILURE TO FURNISH EVIDENCE OF HIS AUTHORITY TO SIGN BIDS ON GOVT. CONTRACTS MAY BE WAIVED AS MINOR IRREGULARITY.

TO MR. ALEXANDER BOSKOFF:

FURTHER REFERENCE IS MADE TO YOUR LETTER DATED OCTOBER 6, 1969, WITH ENCLOSURE, PROTESTING ON BEHALF OF SQUARE DEAL TRUCKING COMPANY, INCORPORATED, WASHINGTON, D.C., ANY POSSIBLE AWARD TO BALDWIN TRASH COMPANY, INCORPORATED, WASHINGTON, D.C., PURSUANT TO FORMALLY ADVERTISED SOLICITATION NO. S-58213/663, ISSUED AUGUST 27, 1969, BY THE NATIONAL AERONAUTICS AND SPACE ADMINISTRATION, GODDARD SPACE FLIGHT CENTER, GREENBELT, MARYLAND, FOR THE PERFORMANCE OF TRASH AND DEBRIS REMOVAL SERVICES DURING A PERIOD OF ONE YEAR COMMENCING ON NOVEMBER 1, 1969.

AT THE SCHEDULED TIME FOR OPENING OF BIDS ON SEPTEMBER 29, 1969, FIVE BIDS WERE RECEIVED. THE LOWEST TOTAL BID, IN THE AMOUNT OF $31,773, WAS SUBMITTED BY BALDWIN AND THE NEXT LOWEST, IN THE AMOUNT OF $32,517.80, WAS SUBMITTED BY THE SQUARE DEAL TRUCKING COMPANY. THE LOW BID WAS SIGNED BY MR. HORACE G. BALDWIN, PRESIDENT OF BALDWIN, AND THE COMPANY WAS IN RECEIVERSHIP WHEN THE BID WAS SUBMITTED. ALTHOUGH MR. BALDWIN HAD BEEN AUTHORIZED BY THE RECEIVER TO SUBMIT BIDS ON GOVERNMENT CONTRACTS, EVIDENCE OF HIS AUTHORITY TO DO SO WAS NOT SUBMITTED WITH THE BALDWIN TRASH COMPANY'S BID, AS WAS REQUIRED IN THAT PART OF STANDARD FORM 33A WHICH STATES THAT OFFERS SIGNED BY AN AGENT ARE TO BE ACCOMPANIED BY EVIDENCE OF HIS AUTHORITY UNLESS SUCH EVIDENCE HAS BEEN PREVIOUSLY FURNISHED TO THE ISSUING OFFICE.

ARTICLE 18 OF THE SOLICITATION PROVIDES THAT A PERFORMANCE BOND IN THE AMOUNT OF 40 PERCENT OF THE ESTIMATED TOTAL CONTRACT PRICE WOULD BE REQUIRED OF THE SUCCESSFUL BIDDER AT THE TIME OF CONTRACT AWARD. THE BALDWIN TRASH COMPANY HAS FURNISHED A PERFORMANCE BOND EXECUTED BY MR. BALDWIN AND BY MR. ISADORE HANIN, PERMANENT RECEIVER OF THE BALDWIN TRASH COMPANY. IN VIEW OF THE PROTEST MADE ON BEHALF OF THE SQUARE DEAL TRUCKING COMPANY, AN EXISTING CONTRACT WITH THAT COMPANY WAS EXTENDED FOR A 30-DAY PERIOD AND IT IS PROPOSED BY THE NATIONAL AERONAUTICS AND SPACE ADMINISTRATION TO AUTHORIZE THE CONTRACTING OFFICER TO AWARD A CONTRACT TO THE BALDWIN TRASH COMPANY FOR A FULL ONE YEAR PERIOD COMMENCING ON DECEMBER 1, 1969, INSTEAD OF NOVEMBER 1, 1969.

YOU CONTEND THAT THE BALDWIN BID SHOULD BE REJECTED BECAUSE IT WAS NOT SIGNED BY THE RECEIVER AND IT WAS NOT ACCOMPANIED BY EVIDENCE OF MR. HORACE G. BALDWIN'S AUTHORIZATION FROM THE RECEIVER TO SUBMIT BIDS ON GOVERNMENT CONTRACTS. YOU ALSO CONTEND THAT THE RECEIVER WOULD NOT HAVE BEEN OBLIGATED TO SUPPLY A PERFORMANCE BOND ON A CONTRACT AWARDED TO THE BALDWIN TRASH COMPANY, AND YOU SUGGEST THAT THERE IS EVEN A DOUBT THAT THE RECEIVER HAS THE AUTHORITY TO ENTER INTO A CONTRACT ON BEHALF OF THE RECEIVERSHIP WHICH WOULD COVER THE PERFORMANCE OF SERVICES DURING A PERIOD EXTENDING FOR AS MUCH AS A FULL YEAR.

ON JANUARY 31, 1969, MR. ISADORE HANIN WAS APPOINTED PERMANENT RECEIVER OF THE BALDWIN TRASH COMPANY BY ORDER OF THE UNITED STATES DISTRICT COURT FOR THE DISTRICT OF COLUMBIA. THE COURT ORDER AUTHORIZES MR. HANIN TO CONTINUE, MANAGE AND OPERATE THE BUSINESS OF THE BALDWIN TRASH COMPANY, WITH FULL AUTHORITY TO CARRY ON, MANAGE AND OPERATE THE SAID BUSINESS, TO BUY AND SELL MERCHANDISE, SUPPLIES OR STOCK IN TRADE FOR CASH OR ON CREDIT AND AS HE MAY DEEM ADVISABLE. THE COURT ORDER ALSO AUTHORIZES MR. HANIN TO EMPLOY MANAGERS, AGENTS, ACCOUNTANTS OR ATTORNEYS AS MAY IN HIS JUDGMENT BE ADVISABLE OR NECESSARY.

IN REGARD TO THE QUESTION AS TO THE DURATION OF ANY CONTRACT THE RECEIVER IS AUTHORIZED TO EXECUTE, IT APPEARS THAT THE DURATION OF ANY SUCH CONTRACTS MAY NOT PROPERLY EXTEND BEYOND REASONABLE LIMITS. SEE, GENERALLY, SECTION 7820 OF FLETCHER CYCLOPEDIA, CORPORATIONS, PERMANENT EDITION, VOLUME 16. SINCE THE BALDWIN TRASH COMPANY HAS IN THE PAST ENTERED INTO CONTRACTS WITH THE GOVERNMENT FOR THE FURNISHING OF TRASH REMOVAL AND DISPOSAL SERVICES DURING ONE-YEAR PERIODS, AND THE FURNISHING OF TRASH REMOVAL AND DISPOSAL SERVICES IS THE MAJOR PART OF THAT COMPANY'S BUSINESS, WE BELIEVE THAT THE RECEIVER HAS THE AUTHORITY TO ENTER INTO SUCH SERVICE CONTRACTS FOR ONE-YEAR PERIODS WITH OR WITHOUT THE SPECIFIC APPROVAL OF THE UNITED STATES DISTRICT COURT, AND IT FURTHER APPEARS TO BE INCONCEIVABLE THAT THE UNITED STATES DISTRICT COURT, WHEN IT AUTHORIZED A CONTINUANCE OF THE COMPANY'S BUSINESS, EXPECTED THE RECEIVER TO DISCONTINUE THE PRACTICE OF BIDDING ON GOVERNMENT CONTRACTS FOR SERVICES TO BE PERFORMED DURING PERIODS NOT EXCEEDING ONE YEAR.

MR. HANIN AUTHORIZED MR. BALDWIN BY LETTER DATED MAY 16, 1969, TO SUBMIT BIDS ON GOVERNMENT CONTRACTS, AND WE FIND NOTHING IN THE COURT ORDER TO JUSTIFY A CONCLUSION THAT MR. HANIN COULD NOT DELEGATE HIS AUTHORITY IN SUCH MATTERS TO AN OFFICER OF THE BALDWIN TRASH COMPANY. FURTHERMORE, SINCE EVIDENCE OF MR. BALDWIN'S AUTHORITY TO SUBMIT BIDS ON GOVERNMENT CONTRACTS WAS PROVIDED IN A PRIOR CASE INVOLVING AN INVITATION FOR BIDS ISSUED BY THE DEPARTMENT OF THE ARMY, AND A BID SUBMITTED UNDER A GOVERNMENT INVITATION FOR BIDS IS BINDING UPON THE BIDDER DURING A SPECIFIED BID ACCEPTANCE PERIOD, WE DO NOT AGREE THAT MR. HANIN WAS NOT OBLIGATED TO FURNISH A PERFORMANCE BOND WHEN THE GODDARD SPACE FLIGHT CENTER DETERMINED THAT AN AWARD SHOULD BE MADE TO THE BALDWIN TRASH COMPANY ON THE BASIS OF THE BID WHICH WAS SIGNED BY MR. BALDWIN.

THE BALDWIN TRASH COMPANY CONTINUED OPERATIONS UNDER THE SAME MANAGEMENT AFTER THE RECEIVER WAS APPOINTED, AND THE GOVERNMENT HAD BEEN PLACED ON NOTICE OF THE AUTHORITY DELEGATED TO MR. BALDWIN ON MAY 16, 1969, IN CONNECTION WITH THE CONSIDERATION OF THE BIDS RECEIVED IN RESPONSE TO THE ARMY INVITATION FOR BIDS. IN VIEW OF SUCH CIRCUMSTANCES, IT IS OUR OPINION THAT THE FAILURE OF MR. BALDWIN TO FURNISH EVIDENCE OF HIS AUTHORITY TO SIGN BIDS ON GOVERNMENT CONTRACTS WHEN THE BID OF THE BALDWIN TRASH COMPANY WAS SUBMITTED UNDER SOLICITATION NO. S-58213/663 PROPERLY MAY BE WAIVED AS A MINOR INFORMALITY OR IRREGULARITY IN BID PURSUANT TO THE PROVISIONS OF PARAGRAPH 10 (B) OF STANDARD FORM 33A, MADE A PART OF THE SOLICITATION, AND SECTION 1-2.405 OF THE FEDERAL PROCUREMENT REGULATIONS.

WE AGREE WITH THE POSITION EXPRESSED IN YOUR LETTER OF NOVEMBER 14, 1969, THAT A CONSCIOUS INTENT TO CONCEAL FROM CONTRACTING OFFICERS THE FACT THAT THE BALDWIN TRASH COMPANY IS IN RECEIVERSHIP SHOULD NOT BE CONDONED. AGREE FURTHER THAT DELIBERATE FAILURES TO FURNISH EVIDENCE OF MR. BALDWIN'S AUTHORITY TO ACT AS AGENT FOR THE RECEIVER WITH THE INTENT TO PERMIT THE RECEIVER TO DISAVOW BIDS AFTER OPENING SHOULD NOT BE PERMITTED. HOWEVER, WE DO NOT BELIEVE THE RECORD BEFORE US DEMONSTRATES THIS HAS HAPPENED. WE ARE NOTIFYING THE RECEIVER FOR BALDWIN TRASH COMPANY THAT FUTURE BIDS BY THE COMPANY MUST EITHER BE SIGNED BY THE RECEIVER OR, IF SIGNED BY MR. BALDWIN, BE ACCOMPANIED BY CURRENT EVIDENCE OF HIS AUTHORITY TO ACT FOR THE RECEIVER.