B-168460, FEB. 2, 1970

B-168460: Feb 2, 1970

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A PURCHASER WHOSE BID DEPOSIT WAS NOT SUFFICIENT TO SUPPORT AWARD OF TWO ITEMS UNDER AN INCREASED BID MODIFICATION. ORAL TELEPHONIC ADVICE FROM SALES OFFICE THAT BID DEPOSIT DID NOT HAVE TO BE INCREASED CANNOT NEGATE BID DEPOSIT REQUIREMENTS. TO ELGIN OFFICE EQUIPMENT COMPANY: REFERENCE IS MADE TO YOUR TELEGRAM AND LETTER OF NOVEMBER 21. BID DEPOSITS: BID DEPOSIT OF TWENTY PERCENT (20%) OF THE TOTAL AMOUNT BID IS REQUIRED. BID OPENING WAS ON NOVEMBER 6. IT IS ADMINISTRATIVELY REPORTED THAT YOUR FIRM SUBMITTED A BID COVERING ITEMS 101 (ACCOUNTING MACHINE). A BID DEPOSIT IN THE AMOUNT OF $500 WAS SUBMITTED WITH THE BID. ELGIN'S BID ON ITEM 101 WAS NOT HIGH. ITS BID ON ITEM 102 IN THE AMOUNT OF $757.75 WAS HIGH AND ITS BID ON ITEM 103 IN THE AMOUNT OF $2.

B-168460, FEB. 2, 1970

BID PROTEST--SALES INVITATION--BID DEPOSIT SUFFICIENCY DECISION TO ELGIN OFFICE EQUIPMENT CO. DENYING PROTEST AGAINST REJECTION OF BID ON BASIS OF INSUFFICIENT BID DEPOSIT UNDER SALES INVITATION USED BY DEFENSE SURPLUS SALES OFFICE, DEFENSE LOGISTICS SERVICE CENTER. A PURCHASER WHOSE BID DEPOSIT WAS NOT SUFFICIENT TO SUPPORT AWARD OF TWO ITEMS UNDER AN INCREASED BID MODIFICATION, HAD BID PROPERLY REJECTED. ORAL TELEPHONIC ADVICE FROM SALES OFFICE THAT BID DEPOSIT DID NOT HAVE TO BE INCREASED CANNOT NEGATE BID DEPOSIT REQUIREMENTS.

TO ELGIN OFFICE EQUIPMENT COMPANY:

REFERENCE IS MADE TO YOUR TELEGRAM AND LETTER OF NOVEMBER 21, 1969, PROTESTING AGAINST THE REJECTION OF YOUR BID ON ITEM NO. 102 UNDER SALES INVITATION NO. 25-0040, ISSUED BY THE DEFENSE SURPLUS SALES OFFICE, DEFENSE LOGISTICS SERVICES CENTER (DLSC), NORFOLK, VIRGINIA.

THE SUBJECT SALES INVITATION, ISSUED ON OCTOBER 20, 1969, SOLICITED BIDS ON VARIOUS ITEMS OF SURPLUS PROPERTY. THE FOLLOWING STATEMENT APPEARS IN PARAGRAPH 15 OF THE ADDITIONAL GENERAL INFORMATION AND INSTRUCTIONS ON PAGE 18 OF THE INVITATION:

"15. BID DEPOSITS: BID DEPOSIT OF TWENTY PERCENT (20%) OF THE TOTAL AMOUNT BID IS REQUIRED. MAKE CHECKS OR MONEY ORDERS PAYABLE TO THE TREASURER OF THE UNITED STATES."

BID OPENING WAS ON NOVEMBER 6, 1969, AND IT IS ADMINISTRATIVELY REPORTED THAT YOUR FIRM SUBMITTED A BID COVERING ITEMS 101 (ACCOUNTING MACHINE), 102 (MAILING MACHINE) AND 103 (MAILING MACHINE) FOR A TOTAL PRICE OF $2,473.35. A BID DEPOSIT IN THE AMOUNT OF $500 WAS SUBMITTED WITH THE BID. BY TELEGRAPHIC MODIFICATION OF NOVEMBER 5, 1969, RECEIVED PRIOR TO BID OPENING, YOUR FIRM INCREASED ITS BID PRICE ON ITEM 102 BY $200 AND ON ITEM 103 BY $200, INCREASING ITS REVISED TOTAL BID ON THE THREE ITEMS TO $2,873.35. THE TELEGRAPHIC MODIFICATION DID NOT INCLUDE ADDITIONAL BID DEPOSIT TO COVER THE INCREASE IN BID PRICES ON ITEMS 102 AND 103. ELGIN'S BID ON ITEM 101 WAS NOT HIGH. ITS BID ON ITEM 102 IN THE AMOUNT OF $757.75 WAS HIGH AND ITS BID ON ITEM 103 IN THE AMOUNT OF $2,057.75 WAS ALSO HIGH, TOTALING $2,815.50. THE TOTAL AMOUNT BID ON THESE TWO ITEMS REQUIRED A 20-PERCENT BID DEPOSIT IN THE SUM OF $563.10. YOUR FIRM'S BID DEPOSIT OF $500, WHILE ADEQUATE FOR THE ORIGINAL BID BEFORE MODIFICATION, WAS SHORT BY $63.10 FOR THE INCREASED TOTAL BID PRICE FOR ITEMS 102 AND 103. WHILE YOUR FIRM'S ORIGINAL BID PRICES FOR ITEMS 102 AND 103 WERE ALSO THE HIGH BIDS RECEIVED, THE CONTRACTING OFFICER HAD NO CHOICE BUT TO CONSIDER YOUR BIDS AS MODIFIED BEFORE BID OPENING.

IN CONNECTION WITH THE FOREGOING SITUATION, DLSC PAMPHLET, "SALE BY REFERENCE, MARCH 1969," WHICH WAS INCORPORATED BY REFERENCE AS A PART OF SALES INVITATION NO. 25-0040, PROVIDED AT PAGE 7, AS FOLLOWS:

"ARTICLE AA: BID DEPOSITS. WHERE A BID DEPOSIT IS REQUIRED BY THE INVITATION, ALL BIDS MUST BE ACCOMPANIED BY SUCH DEPOSIT IN THE AMOUNT OF 20% OF THE TOTAL AMOUNT BID WHICH MUST BE IN THE POSSESSION OF THE SALES CONTRACTING OFFICER BY THE TIME SET FOR BID OPENING. * * * ANY BID WHICH IS NOT TIMELY SUPPORTED BY AN ACCEPTABLE BID DEPOSIT MAY BE REJECTED AS NONRESPONSIVE. * * *"

DIRECTLY PERTINENT TO THE ISSUE PRESENTED BY YOUR PROTEST, ARTICLE AB OF THAT PAMPHLET PROVIDES:

"ARTICLE AB: MODIFICATION OR WITHDRAWAL OF BIDS. BIDS MAY BE MODIFIED OR WITHDRAWN BY WRITTEN OR TELEGRAPHIC NOTICE AND A BID ALSO MAY BE WITHDRAWN IN PERSON BY A BIDDER OR HIS AUTHORIZED REPRESENTATIVE, PROVIDED HIS IDENTITY IS MADE KNOWN AND HE SIGNS A RECEIPT FOR THE BID. WHERE A BID DEPOSIT IS REQUIRED BY THE INVITATION, ANY MODIFICATION WHICH INCREASES THE AMOUNT OF A BID ALREADY SUBMITTED OR WHICH SUBMITS BIDS ON ITEMS NOT PREVIOUSLY BID UPON MUST PROVIDE FOR AN INCREASED BID DEPOSIT."

SINCE YOUR BID DEPOSIT WAS NOT ADEQUATE TO SUPPORT AWARD TO YOU OF BOTH ITEMS ONLY ITEM 103 WAS AWARDED TO YOU AT A PRICE OF $2,057.75 AND ITEM 102 WAS AWARDED TO THE SECOND HIGHEST BIDDER AT A PRICE OF $350. SUCH ACTION WAS IN CONSONANCE WITH OUR DECISION IN 39 COMP. GEN. 617 (1960), WHEREIN WE HELD (QUOTING THE SYLLABUS) AS FOLLOWS:

"A BID DEPOSIT WHICH WAS NOT IN AN AMOUNT SUFFICIENT TO COVER ALL THE ITEMS OF SURPLUS GOVERNMENT PROPERTY BID UPON AS REQUIRED BY THE INVITATION, BUT WHICH WAS SUFFICIENT TO COVER THOSE ITEMS AND QUANTITIES ON WHICH THE BIDDER WAS THE ELIGIBLE HIGH BIDDER, DOES NOT REQUIRE REJECTION OF THE BID FOR INSUFFICIENT BID SECURITY WHEN THE INVITATION DOES NOT CONTAIN ANY LIMITATION ON THE MINIMUM QUANTITIES WHICH MAY BE PURCHASED AND WHEN AWARDS TO SEVERAL BIDDERS ARE CONTEMPLATED." SEE GEORGE EPCAR COMPANY V. UNITED STATES, 377 F. 2D 225 (1967), WHEREIN THE COURT CONSIDERED A SUBSTANTIALLY SIMILAR SITUATION AS INVOLVED HERE AND HELD THAT AN AWARD--BASED ON ITEMS ADEQUATELY SUPPORTED BY A BID DEPOSIT-- WAS PROPER.

WHILE YOU CONTEND THAT YOU WERE TELEPHONICALLY ADVISED BY AN UNIDENTIFIED EMPLOYEE OF THE SALES OFFICE THAT YOUR INITIAL BID DEPOSIT WOULD BE SUFFICIENT TO COVER A FURTHER INCREASE IN YOUR BID PRICES, SUCH ORAL ADVICE CANNOT OPERATE TO NEGATE THE BID DEPOSIT REQUIREMENTS OF THE INVITATION. IN THIS RESPECT, PARAGRAPH 16 OF THE GENERAL SALE TERMS AND CONDITIONS OF THE SALE BY REFERENCE PAMPHLET PROVIDES THAT ORAL STATEMENTS OR REPRESENTATIONS BY A GOVERNMENT REPRESENTATIVE CHANGING OR SUPPLEMENTING THE INVITATION ARE UNAUTHORIZED AND SHALL CONFER NO RIGHT UPON THE BIDDER. ADMITTEDLY, WHILE THE ACCEPTANCE OF YOUR BID ON ITEM 102 WOULD HAVE GIVEN THE GOVERNMENT A GREATER MONETARY RETURN, SUCH ACTION WOULD HAVE CONTRAVENED THE ADVERTISED REQUIREMENTS OF THE SALES INVITATION. SEE 44 COMP. GEN. 292, 296 (1964).

IN VIEW OF THE FOREGOING, YOUR PROTEST CONCERNING THE FAILURE OF THE GOVERNMENT TO AWARD YOU ITEM 102 MUST BE DENIED.