B-169084, MAY 7, 1970

B-169084, MAY 7, 1970

CONTRACTS--SPECIFICATIONS--ADDENDA ACKNOWLEDGMENT--UNPRICED ALTHOUGH BIDDER'S FAILURE TO ACKNOWLEDGE AMENDMENTS TO INVITATION TO PRICE INCREASED QUANTITIES MAY HAVE BEEN DUE TO AMENDMENT NEITHER PROVIDING SPACE FOR INSERTION OF PRICE NOR CALLING FOR PRICES ON ADDITIONAL QUANTITIES, SINCE PROTESTANT'S BID CREATED AMBIGUITY REGARDING ITS INTENTIONS--ACCEPTANCE NOT CONSIDERED AS BINDING BIDDER TO FURNISH ADDITIONAL QUANTITY REQUIRED BY ADDENDUM--REJECTION WAS PROPER. NUMBER OF BIDDERS FAILING TO QUOTE PRICES ON ADDITIONAL ITEMS STANDING ALONE IS INSUFFICIENT GROUND TO SUSTAIN FINDING OF AMBIGUITY TO JUSTIFY CANCELLATION OF INVITATION IN VIEW OF NEW DESTINATION AND DESTINATION DELIVERY REQUIREMENT. SEE COMP. GEN. DECS. CITED.

TO MR. J. DAN CONNELLY:

FURTHER REFERENCE IS MADE TO YOUR LETTER OF FEBRUARY 13, 1970, AND SUBSEQUENT CORRESPONDENCE PROTESTING ON BEHALF OF GENERAL AVIATION INDUSTRIES, INC. (GENERAL), AGAINST THE REJECTION OF ITS BID SUBMITTED UNDER SOLICITATION NO. N00383-69-B-1041, AS AMENDED, ISSUED BY THE NAVY AVIATION SUPPLY OFFICE.

THE SUBJECT INVITATION ISSUED MAY 28, 1969, INVITED BIDS FOR PRODUCTION AND DELIVERY UNDER ITEM 1 OF A TOTAL QUANTITY OF 1477 NT-4 TOW BARS TO TWO DESTINATIONS. A QUANTITY OF 299 UNITS WAS REQUIRED TO BE DELIVERED F.O.B. NORFOLK, VIRGINIA, AND A QUANTITY OF 1178 WAS REQUIRED TO BE DELIVERED F.O.B. NORTH ISLAND, CALIFORNIA. BY AMENDMENT NUMBERED 0001 ISSUED ON JUNE 12, 1969, LOT II, ITEM 2AA WAS ADDED TO THE INVITATION FOR A QUANTITY OF 28 TOW BARS TO BE DELIVERED F.O.B. KELLY AIR FORCE BASE, TEXAS.

THE 31 BIDS RECEIVED IN RESPONSE TO THE SOLICITATION WERE OPENED ON OCTOBER 6, 1969. FOUR BIDDERS NEITHER ACKNOWLEDGED NOR PRICED THE AMENDMENT COVERING THE 28 ADDITIONAL UNITS; SEVEN BIDDERS, INCLUDING GENERAL, ACKNOWLEDGED RECEIPT OF THE AMENDMENT BUT FAILED TO ENTER A PRICE SPECIFICALLY REFERRING TO THE UNITS ADDED THEREBY. THE FOUR LOWEST BIDS RECEIVED WERE AS FOLLOWS:

LOT I LOT II GENERAL $273.00 $ SUPERIOR WELDING, INC. 274.00 GUNDERLIN LTD. 285.20 285.20 HYDRANAMIC SYSTEMS

299.00 299.00

SINCE NEITHER GENERAL NOR SUPERIOR INCLUDED A PRICE FOR LOT II, ITEM 2AA, OR OTHERWISE INDICATED ITS INTENTION THEREON, THEIR BIDS WERE DETERMINED TO BE NONRESPONSIVE AND REJECTED. THE BID OF GUNDERLIN WAS REJECTED AS NONRESPONSIVE BECAUSE IT FAILED TO ACKNOWLEDGE RECEIPT OF 3 OTHER AMENDMENTS. CONSEQUENTLY, AWARD WAS MADE ON DECEMBER 3, 1969, TO HYDRANAMIC, AS THE LOW, RESPONSIVE, RESPONSIBLE BIDDER.

YOU HAVE SUBMITTED SEVERAL ARGUMENTS AS TO WHY GENERAL'S BID WAS RESPONSIVE AND SHOULD HAVE BEEN ACCEPTED, AND AWARD MADE TO IT AS THE LOW BIDDER. BASICALLY, YOU CONTEND THAT GENERAL'S ACKNOWLEDGMENT OF AMENDMENT NUMBER 0001 WAS RESPONSIVE IN ACCORDANCE WITH THE TERMS OF STANDARD FORM 30 AS RECEIVED BY IT AND THEREFORE ITS BID WAS RESPONSIVE; THAT BECAUSE OF THE LANGUAGE IN BLOCK 9 OF FORM 30 WHICH PROVIDES:

"IF, BY VIRTUE OF THIS AMENDMENT YOU DESIRE TO CHANGE AN OFFER ALREADY SUBMITTED, SUCH CHANGE MAY BE MADE BY TELEGRAM OR LETTER, PROVIDED SUCH TELEGRAM OR LETTER MAKES REFERENCES TO THE SOLICITATION AND THIS AMENDMENT, AND IS RECEIVED PRIOR TO THE OPENING HOUR AND DATE SPECIFIED." AND THE STATEMENT IN BLOCK 12:

"EXCEPT AS PROVIDED HEREIN, ALL TERMS AND CONDITIONS OF THE DOCUMENT REFERENCED IN BLOCK 8, AS HERETOFORE CHANGED, REMAIN UNCHANGED AND IN FULL FORCE AND EFFECT." COUPLED WITH THE FACT THAT AMENDMENT 0001 CONTAINED NO SPACE FOR DESIGNATION OR INSERTION OF A PRICE FOR THE ADDITIONAL QUANTITIES MADE, AMENDMENT 0001 WAS BY ITS OWN TERMS AMBIGUOUS, AND SUCH AMBIGUITY IS TO BE CONSTRUED IN FAVOR OF THE PARTY WHO DID NOT DRAFT THE INSTRUMENT.

YOU ALSO CONTEND THAT BECAUSE OF THE NUMBER OF BIDDERS WHO MISINTERPRETED THE INVITATION THIS WAS IN AND OF ITSELF ADEQUATE REASON FOR CANCELLATION, CITING IN SUPPORT THEREOF OUR DECISION B-150770, MAY 1, 1963. IT IS ALSO URGED THAT GENERAL'S FAILURE TO QUOTE A PRICE FOR THE ADDITIONAL ITEMS WAS A MINOR INFORMALITY OR IRREGULARITY WHICH COULD HAVE BEEN WAIVED UNDER SECTION 2-405 OF THE ARMED SERVICES PROCUREMENT REGULATION (ASPR). FINALLY, YOU COMPLAIN THAT NO CONTACT WAS MADE WITH GENERAL IN AN EFFORT TO CLARIFY THIS MATTER UNTIL DECEMBER 2, 1969, ONE DAY BEFORE THE AWARD TO HYDRANAMIC.

THE RESPONSIVENESS OR NONRESPONSIVENESS OF A BID IS FOR DETERMINATION UPON THE BASIS OF ALL OF THE TERMS OF THE BID AND THE INVITATION ON WHICH IT IS SUBMITTED. 41 COMP. GEN. 721 (1962). PARAGRAPH 112 OF THE SOLICITATION INSTRUCTIONS AND CONDITIONS PROVIDED:

"112-AWARD OF ALL ITEMS - AWARD WILL BE MADE UNDER THIS SOLICITATION TO THE LOW OVERALL BIDDER ON ALL ITEMS."

PARAGRAPH 412 CAUTIONED ALL BIDDERS THAT A BID WHICH OFFERED TO FURNISH ONLY PART OF THE SUPPLIES WOULD BE CONSIDERED NONRESPONSIVE AND REJECTED IN ITS ENTIRETY. IT IS THEREFORE ABUNDANTLY CLEAR THAT ALL BIDDERS WERE REQUIRED TO FURNISH A PRICE FOR ALL OF THE SUPPLIES AND THAT ONLY ONE AWARD WOULD BE MADE TO THE LOW OVERALL BIDDER, AND NOTHING IN THE AMENDMENT INDICATED ANY CHANGE IN THIS REQUIREMENT. A MERE ACKNOWLEDGMENT OF THE AMENDMENT IN ACCORDANCE WITH THE PRINTED LANGUAGE THEREON DOES NOT APPEAR TO CONSTITUTE AN OFFER TO FURNISH THE ADDITIONAL QUANTITY AT THE PRICE QUOTED FOR THE ORIGINAL QUANTITIES, AND THE BID MUST THEREFORE BE CONSIDERED AS NONRESPONSIVE.

WE FAIL TO SEE ANY AMBIGUITY IN BLOCKS 9 AND 12 OF THE AMENDMENT QUOTED ABOVE WHEN READ IN CONJUNCTION WITH THE OTHER TERMS OF THE INVITATION. PARAGRAPH 12 MERELY PROVIDED THAT EXCEPT AS PROVIDED IN THE AMENDMENT, ALL TERMS AND CONDITIONS OF THE IFB REMAINED UNCHANGED, WHICH, OF COURSE, WOULD INCLUDE PARAGRAPHS 112 AND 412 QUOTED ABOVE. PARAGRAPH 9 INSTRUCTS BIDDER HOW TO EFFECT A CHANGE, IF DESIRED, IN AN OFFER ALREADY SUBMITTED AND DOES NOT RELIEVE A BIDDER FROM QUOTING PRICES ON ADDITIONAL ITEMS ADDED TO THE PROCUREMENT BY THE AMENDMENT.

WE HAVE NOTED THAT SEVEN OF THE 27 BIDDERS WHO ACKNOWLEDGED THE AMENDMENT IN QUESTION FAILED TO PRICE THE AMENDMENT. THIS FAILURE MAY WELL HAVE BEEN DUE TO THE FACT THAT AMENDMENT 0001 DID NOT PROVIDE SPACE FOR THE INSERTION OF PRICES, NOR DID IT (THE AMENDMENT) SPECIFICALLY CALL FOR PRICES ON THE ADDITIONAL ITEMS CALLED FOR THEREIN. WE THINK THIS SITUATION COULD HAVE BEEN PREVENTED BY SO FORMULATING THE AMENDMENT AS TO LEAVE NO DOUBT ABOUT WHAT WAS REQUIRED. WE ARE CALLING THIS MATTER TO THE ATTENTION OF THE NAVY SO AS TO PRECLUDE ANY RECURRENCE. HOWEVER, WE DO NOT FEEL THAT THE NUMBER OF BIDDERS WHO FAILED TO QUOTE PRICES ON THE ADDITIONAL ITEMS STANDING ALONE IS SUFFICIENT GROUND TO SUSTAIN A FINDING OF AMBIGUITY WHICH WOULD JUSTIFY A CANCELLATION OF THE INVITATION IN QUESTION, ESPECIALLY IN VIEW OF THE FACT THAT A NEW DESTINATION (KELLY AIR FORCE BASE) WAS NAMED FOR THE RECEIPT OF THE ADDITIONAL ITEMS, AND THE INVITATION CALLED FOR DESTINATION DELIVERY.

OUR DECISION OF MAY 1, 1963 (B-150770), WHICH AGREED WITH THE ADMINISTRATIVE DETERMINATION TO CANCEL THE INVITATION, WAS NOT BASED UPON THE FACT THAT 3 OF 11 BIDDERS HAD MISINTERPRETED THE INVITATION, BUT RATHER THAT THE INVITATION WAS DEFECTIVE IN SEVERAL OTHER RESPECTS. CONTRARY TO YOUR ASSERTION THAT OUR DECISION B-167495, SEPTEMBER 2, 1969, IS DISTINGUISHABLE FROM THE CASE AT HAND BECAUSE IN THAT CASE A PRICING COLUMN WAS INCLUDED, THE EXACT OPPOSITE IS TRUE, BECAUSE THERE WAS NO PRICING COLUMN. A COPY OF THAT DECISION IS ENCLOSED.

WHILE WE BELIEVE THAT THE MANNER IN WHICH GENERAL ENTERED ITS BID WAS AN ERROR BASED ON ITS HONEST MISINTERPRETATION, THE FACT REMAINS THAT IT WAS IMPOSSIBLE TO INTERPRET THE INTENT OF YOUR CLIENT, SINCE SUCH INTENT IS NOT REFLECTED IN THE BID AS SUBMITTED, AND WE DO NOT BELIEVE THAT ACCEPTANCE OF ITS BID AS SUBMITTED WOULD BIND IT TO FURNISH THE 28 UNITS ADDED BY THE AMENDMENT. IN 38 COMP. GEN. 372, 376 (1958), WE STATED, "WHERE THE ERROR IS ONE OF A FAILURE TO QUOTE A PRICE, SUCH AS MAY BE CONSIDERED TO BE INVOLVED IN THE INSTANT CASE, THE BID NORMALLY WOULD BE FOR REJECTION AS NOT BEING RESPONSIVE TO THE INVITATION." AT THE MOST, GENERAL'S BID CREATED AN AMBIGUITY REGARDING ITS INTENTIONS THAT WOULD REQUIRE COMPLETION OR CLARIFICATION OF ITS BID SO AS TO SPELL OUT GENERAL'S INTENTIONS.

IN OUR OPINION IT IS AN ESSENTIAL OF A VALID BID THAT IT BE SUFFICIENTLY DEFINITE TO ENABLE THE GOVERNMENT TO ACCEPT IT WITH CONFIDENCE THAT THE CONTRACT SO MADE CAN BE INTERPRETED AND ENFORCED WITHOUT RESORT TO EXTRANEOUS EVIDENCE. MOREOVER, THE COMPETITIVE BIDDING SYSTEM WOULD BE COMPROMISED IF A BIDDER WERE PERMITTED, AFTER BIDS ARE OPENED AND DISCLOSED TO THE OTHER BIDDERS, TO CLARIFY HIS BID BY SELF-SERVING EXPLANATIONS WHEN SUCH BID IS SO UNCLEAR AS TO LEAVE A SUBSTANTIAL DOUBT AS TO THE RIGHTS AND OBLIGATIONS THAT WOULD ARISE BY ACCEPTING IT. THE OMISSION OF A BID PRICE ON AN ITEM MIGHT INDICATE THAT THE BIDDER DOES NOT INTEND TO FURNISH THIS ITEM, AND TO PERMIT THE BIDDER WHO FAILED, AS GENERAL DID HERE, TO BID ON A CERTAIN ITEM, TO FURNISH EVIDENCE TO ESTABLISH AN INTENTION TO WHICH HE COULD NOT OTHERWISE BE HELD WOULD BE TANTAMOUNT TO PERMITTING HIM TO SUBMIT A NEW BID AFTER THE PRICES OF THE OTHER BIDDERS HAD BEEN ASCERTAINED. A BID WHICH IS NOT RESPONSIVE TO AN INVITATION MAY NOT BE CORRECTED TO MAKE IT RESPONSIVE. 38 COMP. GEN. 819 (1959).

WE HAVE REPEATEDLY HELD THAT DEVIATIONS IN A BID FROM THE ADVERTISED SPECIFICATIONS RELATIVE TO FACTORS AFFECTING PRICE GO TO THE SUBSTANCE OF THE BID AND THEREFORE MAY NOT BE WAIVED AS MERE INFORMALITIES ENVISIONED BY ASPR 2-405. 44 COMP. GEN. 753 (1965); B-161576, JULY 13, 1967.

SINCE THE QUESTION OF RESPONSIVENESS IS TO BE DETERMINED AT THE TIME BIDS ARE OPENED, WE SEE NOTHING FATAL TO THE CULMINATION OF A LEGAL AND BINDING CONTRACT, BY THE CONTRACTING OFFICER'S REFUSAL TO COMMUNICATE WITH YOUR CLIENT CONCERNING THE QUESTION OF THE RESPONSIVENESS OF ITS BID. WE DO THINK, HOWEVER, THAT BETWEEN THE TIME BIDS WERE OPENED (OCTOBER 6, 1969) AND THE TIME THE AWARD WAS MADE (DECEMBER 3, 1969), THE CONTRACTING OFFICER SHOULD NOT HAVE REFUSED, IF INDEED HE DID, TO DISCUSS THIS MATTER WITH GENERAL SO AS TO PERMIT IT, IF IT SO DESIRED, TO FILE A PROTEST PRIOR TO AWARD.

THEREFORE, WE MUST CONCUR IN THE ADMINISTRATIVE ACTION TAKEN IN REJECTING THE BID OF GENERAL AS NONRESPONSIVE. WHILE A SAVING TO THE GOVERNMENT COULD HAVE BEEN EFFECTED BY ACCEPTING ITS BID, WE HAVE CONSISTENTLY HELD THAT IT IS MORE IN THE PUBLIC INTEREST TO COMPLY WITH ESTABLISHED PROCEDURES FOR PROTECTING AND PRESERVING THE COMPETITIVE BIDDING SYSTEM THAN TO OBTAIN A PECUNIARY ADVANTAGE IN A PARTICULAR CASE. 41 COMP. GEN. 412 (1961).