B-169927(1), MAR 16, 1971

B-169927(1): Mar 16, 1971

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PROTESTANT'S BID WAS FOUND NONRESPONSIVE DUE TO DEVIATIONS FROM THE TERMS OF THE INVITATION SPECIFICALLY THE WARRANTY OFFERED. HAS RECOGNIZED THAT THE TERMS OF A WARRANTY ARE A MATERIAL PART OF BID SPECIFICATIONS AND THAT A QUALIFICATION OF WARRANTY TERMS IN A BID WILL REQUIRE REJECTION OF SUCH BID AS NONRESPONSIVE. THE EXTENSION OF DELIVERY DATE DOES NOT REQUIRE CANCELLATION OF THE AWARD AND THE PROTEST IS THEREFORE DENIED. THE INVITATION WAS FOR BIDS FOR PROVISION AND INSTALLATION OF A FLUID BED INCINERATOR SYSTEM TO BE USED IN PILOT STUDIES OF PROCESSING SLUDGES PRODUCED IN CONVENTIONAL AND ADVANCED WASTEWATER TREATMENT PROCESSES. THE INCINERATOR WILL BE USED ALTERNATELY TO FORM ORGANIC SLUDGES.

B-169927(1), MAR 16, 1971

BID PROTEST - BID RESPONSIVENESS - WARRANTY DECISION DENYING PROTEST BY LOW BIDDER AGAINST AWARD OF CONTRACT TO COPELAND SYSTEMS, INC., SECOND LOW BIDDER, UNDER IFB ISSUED BY THE DISTRICT OF COLUMBIA FOR PROVISION AND INSTALLATION OF A FLUID BED INCINERATOR SYSTEM. PROTESTANT'S BID WAS FOUND NONRESPONSIVE DUE TO DEVIATIONS FROM THE TERMS OF THE INVITATION SPECIFICALLY THE WARRANTY OFFERED. THE COMP. GEN. HAS RECOGNIZED THAT THE TERMS OF A WARRANTY ARE A MATERIAL PART OF BID SPECIFICATIONS AND THAT A QUALIFICATION OF WARRANTY TERMS IN A BID WILL REQUIRE REJECTION OF SUCH BID AS NONRESPONSIVE. SEE 45 COMP. GEN. 273 (1965). FURTHER, THE EXTENSION OF DELIVERY DATE DOES NOT REQUIRE CANCELLATION OF THE AWARD AND THE PROTEST IS THEREFORE DENIED.

TO BANGOR PUNTA OPERATIONS, INC.:

WE REFER TO YOUR LETTER OF JUNE 12, 1970, WHICH PROTESTED THE AWARD OF A CONTRACT TO ANOTHER BIDDER UNDER INVITATION FOR BIDS NO. 45-604-0 0492 DM, ISSUED BY THE GOVERNMENT OF THE DISTRICT OF COLUMBIA.

THE INVITATION WAS FOR BIDS FOR PROVISION AND INSTALLATION OF A FLUID BED INCINERATOR SYSTEM TO BE USED IN PILOT STUDIES OF PROCESSING SLUDGES PRODUCED IN CONVENTIONAL AND ADVANCED WASTEWATER TREATMENT PROCESSES. THE INCINERATOR WILL BE USED ALTERNATELY TO FORM ORGANIC SLUDGES, RECALCINE A LIME MUD SLUDGE CONTAINING SEVERAL INERT AND ORGANIC CONTAMINANTS, AND TO REACTIVATE, THERMALLY, POWDERED ACTIVATED CARBON. BIDDERS WERE REQUIRED TO DEMONSTRATE EXPERIENCE IN HAVING PRODUCED UNITS OF THE SAME TYPE AND SIZE SPECIFIED IN THE INVITATION BY LISTING PREVIOUS INSTALLATIONS AND THE DATES THEREOF.

THE INVITATION PROVIDED ON PAGE 5 THAT THE OPERATING TEMPERATURE OF THE FLUIDIZED BED FURNACE SHALL BE MAINTAINED AT APPROXIMATELY 1300 TO 1500 DEGREES FAHRENHEIT FOR ORGANIC SLUDGE INCINERATION, 1550 DEGREES FOR RECALCINATION, AND 1200 DEGREES FOR CARBON REGENERATION. ON PAGE 9, THE FOLLOWING WARRANTY WAS REQUIRED:

"9. WARRANTY. THE CONTRACTOR WARRANTS THE EQUIPMENT FURNISHED BY HIM TO BE FREE FROM ALL DEFECTS WHATSOEVER IN MATERIALS AND WORKMANSHIP AND AGREES THAT FOR A PERIOD OF ONE (1) YEAR FROM DATE OF ACCEPTANCE BY THE DISTRICT ANY SUCH REPAIRS, REPLACEMENTS, OR ADJUSTMENTS MADE NECESSARY BECAUSE OF SUCH DEFECTS WILL BE MADE PROMPTLY BY HIM WITHOUT COST TO AND TO THE SATISFACTION OF THE DISTRICT, WHICH WARRANTY SHALL NOT OPERATE TO DEFEAT THE PURPOSE OF PAR. 9 - GENERAL CONDITIONS - NOT SHALL IT ACT TO VOID GUARANTEES BY THE MANUFACTURER OF THE EQUIPMENT OR ITS COMPONENTS."

BID OPENING WAS SCHEDULED FOR MARCH 13, 1970, AND SUBSEQUENTLY EXTENDED BY ADDENDUM NO. 1 TO APRIL 1, 1970. THREE BIDS WERE OPENED ON THE LATTER DATE. THE LOWEST BID WAS FROM BARTLETT-SNOW DIVISION OF BANGOR PUNTA OPERATIONS, INC., IN THE AMOUNT OF $128,170. THE SECOND LOW BID WAS FROM COPELAND SYSTEMS, INC., IN THE AMOUNT OF $161,900, AND THE HIGHEST BID WAS FROM DORR-OLIVER, INC., IN THE AMOUNT OF $218,500.

BARTLETT-SNOW SUBMITTED AN EQUIPMENT PROPOSAL WITH ITS BID WHICH CONTAINED THE FOLLOWING TERMS AND CONDITIONS:

"WARRANTY: WE WILL PROVIDE EQUIPMENT WHICH IS FREE FROM DEFECTS IN WORKMANSHIP AND MATERIAL FOR A PERIOD OF ONE YEAR AFTER DELIVERY TO YOU. IF WITHIN THAT TIME ANY ITEMS WE SUPPLY APPEAR TO HAVE BEEN DEFECTIVE AT TIME OF SHIPMENT, WE WILL REPAIR OR, AT OUR OPTION, SUPPLY WITHOUT CHARGE NEW ITEMS, F.O.B. OUR FACTORY, PROVIDED THAT:

(A) OUR INSPECTORS DETERMINE THEM TO BE DEFECTIVE IN WORKMANSHIP OR MATERIAL.

(B) UPON OUR REQUEST YOU RETURN THEM TO OUR PRODUCING PLANT WITHIN 12 MONTHS AFTER THEY WERE SHIPPED TO YOU.

(C) TERMS OF PAYMENT HAVE BEEN FULLY MET.

YOU UNDERSTAND THAT THE REMEDIES LISTED HEREIN ARE THE SOLE AND EXCLUSIVE REMEDIES WHETHER IN TORT, CONTRACT OR OTHERWISE.

WE REGRET THAT WE CANNOT BE RESPONSIBLE FOR:

(A) LOSS OR DAMAGE, EITHER DIRECT, INDIRECT OR CONSEQUENTIAL, OR LOSS OF ANTICIPATED PROFITS ARISING FROM USE OF THE MATERIAL OR EQUIPMENT, OR FROM OTHER CAUSES, INCLUDING ANY LOSS OR DAMAGE OCCASIONED BY ANY USE OF OUR EQUIPMENT OR MATERIALS OTHER THAN THAT FOR WHICH SUCH IS OR ARE DESIGNED AND INTENDED.

(B) DAMAGE OCCURRING AFTER DELIVERY OF THE EQUIPMENT TO A COMMON CARRIER.

(C) EQUIPMENT OR PARTS THEREOF WHICH ARE SUBJECT TO DAMAGE RESULTING FROM CYCLIC HEATING OR TEMPERATURES IN EXCESS OF 1,000 DEGREES FAHRENHEIT.

EQUIPMENT MANUFACTURED BY COMPANIES OTHER THAN OURSELVES WILL CARRY ONLY THE APPLICABLE WARRANTY OF THE ORIGINAL MANUFACTURER.

IT IS EXPRESSLY AGREED THAT NO WARRANTY OF MERCHANTABILITY, NOR OTHER WARRANTY, EXPRESS, IMPLIED, OR STATUTORY, IS MADE BY THE SELLER, EXCEPT THAT THE SELLER WARRANTS THE GOODS TO BE FREE FROM DEFECTS IN MATERIALS AND WORKMANSHIP IN NORMAL USE AND SERVICE, AS HEREINABOVE PROVIDED.

PURCHASE ORDER: SINCE THE PRICES WE HAVE QUOTED WERE PREDICATED UPON THE TERMS AND CONDITIONS OUTLINED HEREIN, YOU APPRECIATE THAT WE CANNOT ACCEPT YOUR ORDER UNDER OTHER TERMS OR CONDITIONS, SUCH AS THOSE FREQUENTLY PRINTED ON THE REVERSE SIDE OF A PURCHASE ORDER. SHOULD YOU FEEL THAT OTHER CONDITIONS ARE NECESSARY OR DESIRABLE FOR YOUR PROTECTION, WE ENCOURAGE YOU TO CALL THEM TO OUR ATTENTION; UPON OUR WRITTEN ACCEPTANCE THEY SHALL BE AS BINDING UPON US AS THOSE CONTAINED HEREIN."

THE ADMINISTRATIVE REPORT FROM THE DISTRICT OF COLUMBIA, A COPY OF WHICH WAS FURNISHED TO YOU, ADVISED THAT THE BID OF BARTLETT-SNOW DEVIATED SO MATERIALLY FROM THE INVITATION THAT IT WAS CONSIDERED TO BE A COUNTEROFFER AND WAS REJECTED FOR FAILURE TO COMPLY WITH THE SUBSTANTIVE REQUIREMENTS OF THE SPECIFICATIONS. A CONTRACT WAS AWARDED TO COPELAND SYSTEMS, INC., ON MAY 25, 1970, AS THE LOWEST BIDDER IN COMPLIANCE WITH THE SPECIFICATIONS AS ADVERTISED.

YOU PROTESTED THAT THE REJECTION OF BARTLETT-SNOW'S BID WAS IMPROPER, WHETHER REJECTION WAS FOR LACK OF EXPERIENCE IN FLUID BED INCINERATORS, FOR FAILURE TO COMPLY WITH TECHNICAL SPECIFICATIONS OR FOR ANY OTHER REASON. IN ADDITION YOU PROTESTED THAT COPELAND SYSTEMS COULD NOT MEET THE DELIVERY SCHEDULE AND DID NOT SUBMIT ANY SPECIFICATIONS FOR ITS INCINERATOR.

THE ADMINISTRATIVE REPORT POINTED OUT THAT YOUR BID WAS NOT REJECTED FOR LACK OF EXPERIENCE, BUT THAT A THOROUGH REVIEW OF YOUR BID DISCLOSED A NUMBER OF DEVIATIONS FROM THE TERMS OF THE INVITATION. THESE DEVIATIONS WERE PARTICULARLY APPARENT WITH RESPECT TO THE WARRANTY OFFERED, AS OPPOSED TO THE WARRANTY REQUIRED, BY THE INVITATION.

YOUR WARRANTY RESERVED TO YOUR INSPECTORS THE RIGHT TO DETERMINE DEFECTS AND RESERVED AN OPTION TO FURNISH NEW ITEMS F.O.B. YOUR FACTORY TO REPLACE DEFECTIVE ONES, WHEREAS THE INVITATION PROVIDED THAT REPAIRS, REPLACEMENTS OR ADJUSTMENTS WILL BE MADE WITHOUT COST TO AND TO THE SATISFACTION OF THE DISTRICT. THE INVITATION REQUIRED THE EQUIPMENT TO BE DELIVERED AND INSTALLED READY FOR OPERATION, WHILE YOU STATED THAT YOU COULD NOT BE RESPONSIBLE FOR DAMAGE AFTER DELIVERY TO A COMMON CARRIER. THE INVITATION SPECIFIED OPERATING TEMPERATURES RANGING FROM 1200 TO 1550 DEGREES FAHRENHEIT WHEREAS YOU STATED THAT YOU CANNOT BE RESPONSIBLE FOR DAMAGE TO EQUIPMENT SUBJECTED TO TEMPERATURES IN EXCESS OF 1000 DEGREES FAHRENHEIT. YOU STATED THAT EQUIPMENT MANUFACTURED BY COMPANIES OTHER THAN YOURSELF WILL CARRY ONLY THE APPLICABLE WARRANTY OF THE ORIGINAL MANUFACTURER WITHOUT FURNISHING ANY INFORMATION AS TO WHAT WARRANTIES, IF ANY, APPLY TO THE NUMEROUS ITEMS IN THIS CATEGORY, NOTWITHSTANDING THE REQUIREMENT THAT EQUIPMENT FURNISHED MUST BE WARRANTED FREE FROM ALL DEFECTS WHATSOEVER FOR A PERIOD OF ONE YEAR. EACH OF THESE QUALIFICATIONS CONSTITUTES A SUBSTANTIAL LIMITATION OF THE REQUIRED WARRANTY, AND THE EFFECT IS THAT YOUR BID CANNOT BE REGARDED AS RESPONSIVE TO THE INVITATION.

ONE OF THE BASIC PRINCIPLES OF COMPETITIVE BIDDING FOR PUBLIC CONTRACTS IS THAT A CONTRACT MAY BE AWARDED ONLY ON A BID WHICH IS RESPONSIVE TO THE TERMS OF THE INVITATION. OUR OFFICE HAS RECOGNIZED THAT THE TERMS OF A WARRANTY ARE A MATERIAL PART OF BID SPECIFICATIONS AND THAT A QUALIFICATION OF WARRANTY TERMS IN A BID WILL REQUIRE REJECTION OF SUCH A BID AS NONRESPONSIVE. 45 COMP. GEN. 273 (1965); B 154972, OCTOBER 8, 1964. IN THE CIRCUMSTANCES, THE DISTRICT HAD NO CHOICE BUT TO REJECT YOUR BID.

YOUR BID CONTAINED A NUMBER OF OTHER QUALIFICATIONS OF THE TERMS OF THE INVITATION SUCH AS YOUR REQUIREMENT FOR PAYMENT IN 30 DAYS NET FOR MATERIAL AS SHIPPED OR AS READY FOR SHIPMENT, ALTHOUGH THE INVITATION PROVIDED FOR PAYMENT ONLY AFTER PERFORMANCE OF THE CONTRACT IN ACCORDANCE WITH ALL THE PROVISIONS THEREOF (PARAGRAPH 11 ON PAGE 2 OF THE INVITATION). YOU ALSO STATED THAT SHOULD THE EQUIPMENT AS SUPPLIED VARY FROM THAT LISTED IN YOUR PROPOSAL, THERE WOULD BE A CORRESPONDING DECREASE OR INCREASE IN THE PRICE QUOTED, A PROVISION THAT NEGATES THE FIXED-PRICE CONTRACT FOR SPECIFIED REQUIREMENTS AS CONTEMPLATED BY THE TERMS OF THE INVITATION. IN ADDITION, AS YOUR LETTER OF PROTEST POINTED OUT, THERE ARE SEVERAL DIFFERENCES BETWEEN BARTLETT-SNOW'S FLUID BED INCINERATOR AND THAT SPECIFIED BY THE INVITATION, WHICH DIFFERENCES YOU CHARACTERIZED AS "NOT SUBSTANTIAL". THE QUESTION OF WHETHER THE QUALIFICATIONS AND DIFFERENCES ARE SUBSTANTIAL OR MATERIAL IS CONSIDERED TO BE ACADEMIC FOR THE REASON THAT, EVEN IF YOUR BID HAD CONFORMED IN ALL OTHER RESPECTS TO THE INVITATION, YOUR QUALIFICATION OF THE WARRANTY TERMS WOULD STILL RENDER YOUR BID NONRESPONSIVE AND REQUIRE ITS REJECTION.

YOU ALSO CONTEND THAT THE SUCCESSFUL BIDDER DID NOT OFFER TO MEET THE DELIVERY DATE. BY THE TERMS OF THE INVITATION, BID OPENING WAS ORIGINALLY SET FOR MARCH 13, 1970, AND AWARD WAS TO BE MADE BY APRIL 12, 1970, WITH COMPLETION SCHEDULED 232 DAYS LATER ON NOVEMBER 30, 1970. COPELAND SYSTEMS' BID OFFERED COMPLETION IN 225 CALENDAR DAYS FROM DATE OF ORDER, WHICH WOULD HAVE BEEN ON NOVEMBER 23 IF AWARD HAD BEEN MADE AT THE LATEST POSSIBLE DATE ORIGINALLY PROVIDED IN THE INVITATION. WHEN THE DISTRICT DELAYED BID OPENING TO APRIL 1 AND LATER REQUESTED BIDDERS TO EXTEND THEIR ACCEPTANCE TIME TO MAY 18 AND THEN TO MAY 25, WE BELIEVE THAT IT MAY REASONABLY BE CONSIDERED TO HAVE WAIVED ITS RIGHT TO INSIST ON DELIVERY BY NOVEMBER 30. IT IS A RECOGNIZED PRINCIPLE OF PUBLIC PROCUREMENTS THAT AN EXTENSION OF DELIVERY TIME SHOULD BE ALLOWED TO COMPENSATE FOR DELAY BY THE PROCURING ACTIVITY IN MAKING AWARD. DISTRICT OF COLUMBIA V CAMDEN IRON WORKS, 181 U.S. 453 (1901); NICHOLAS ITTNER V UNITED STATES, 43 CT. CL. 336 (1908); AND GRIFFITHS V UNITED STATES, 77 CT. CL. 542 (1933). SEE ALSO SECTION 1 1.316-4(B), FEDERAL PROCUREMENT REGULATIONS, WHICH EMBODIES THIS PRINCIPLE AND REQUIRES GOVERNMENT AGENCIES TO MAKE PROVISION IN INVITATIONS FOR EXTENSION OF SPECIFIED DELIVERY DATES BY THE NUMBER OF CALENDAR DAYS AWARDS ARE DELAYED. WE UNDERSTAND THAT THE DISTRICT IS GUIDED BY THOSE REGULATIONS WHERE IT HAS NOT ISSUED ANY REGULATIONS APPLICABLE TO THE SITUATION. SEE 44 COMP. GEN. 539, 542 (1965).

THE REMAINING CONTENTION IN YOUR PROTEST WAS THAT COPELAND SYSTEMS DID NOT FURNISH ANY SPECIFICATIONS FOR ITS FLUID BED INCINERATOR. DETAILED SPECIFICATIONS AS TO FUNCTIONAL REQUIREMENTS OF THE SYSTEM, EQUIPMENT TO BE FURNISHED, PHYSICAL RESTRICTIONS AND INSTALLATION REQUIREMENTS WERE SET OUT IN THE IFB. WHILE THE INVITATION STATED THAT BIDDERS SHOULD SUPPLY SUFFICIENT DESCRIPTIVE CATALOGUE MATERIAL AND TECHNICAL DATA TO ADEQUATELY DESCRIBE THE EQUIPMENT, DETAILED INFORMATION WAS SPECIFICALLY REQUESTED ONLY AS TO THOSE AREAS WHEREIN THE EQUIPMENT PROPOSED TO BE FURNISHED DIFFERED FROM THE SPECIFICATIONS. COPELAND SYSTEMS DID NOT SUBMIT ANY STATEMENT OF DIFFERENCES BETWEEN ITS INCINERATOR AND THE ONE REQUIRED BY THE SPECIFICATIONS, AND ITS BID WAS PROPERLY EVALUATED AS OFFERING EQUIPMENT MEETING ALL OF THE SPECIFICATIONS DETAILED IN THE IFB. SINCE THE IFB'S SPECIFICATIONS, AND COPELAND'S BID WHICH INCORPORATED THOSE SPECIFICATIONS, CONTAINED THOSE ESSENTIAL REQUIREMENTS FOR AN ACCEPTABLE SYSTEM, THE ADDITIONAL CATALOGUE MATERIAL DOES NOT APPEAR TO HAVE BEEN NECESSARY FOR THE PRESENTATION OF AN ADEQUATE DESCRIPTION OF THE EQUIPMENT COPELAND PROPOSED TO FURNISH. HOWEVER, COPELAND SUBMITTED WITH ITS BID GENERAL DESCRIPTIVE CATALOGUE MATERIAL CONSISTING OF SEVEN PAGES OF PHOTOGRAPHS, DRAWINGS AND DESCRIPTIONS OF THE APPLICATION OF THE FLUID BED PROCESS TO VARIOUS MATERIALS AND ONE PAGE OF SPECIFIC INFORMATION RELATING TO OPERATION OF THE FURNACE UNDER THE TERMS AND CONDITIONS OF THE INVITATION.

IN 49 COMP. GEN. 311 (1969), WE HELD THAT THE DESCRIPTIVE INFORMATION REQUESTED DID NOT CONTRIBUTE MATERIALLY TO PROPER EVALUATION AND THEREFORE ITS ABSENCE DID NOT RENDER A BID NONRESPONSIVE. WE STATED OUR BELIEF THAT AN INVITATION SHOULD NOT SOLICIT UNNECESSARY INFORMATION AND REQUESTED GSA TO DELETE REQUESTS FOR INFORMATION IN THE ABSENCE OF A LEGITIMATE JUSTIFICATION THEREFOR. IN THE PRESENT CASE, THE BID OF COPELAND WAS APPARENTLY EVALUATED WITHOUT THE NECESSITY TO REFER TO MORE SPECIFIC TECHNICAL DATA AND CATALOGUE MATERIAL, AND WE QUESTION WHETHER THE REQUEST FOR SUCH DESCRIPTIVE INFORMATION IN THIS INSTANCE SERVED ANY USEFUL PURPOSE. SEE 49 COMP. GEN. 398 (1969).

IN ACCORD WITH THESE DECISIONS, WE HAVE RECOMMENDED THAT THE DISTRICT OF COLUMBIA EVALUATE THE NECESSITY FOR DESCRIPTIVE MATERIAL PROVISIONS MORE CAREFULLY IN FUTURE PROCUREMENTS AND THAT SUCH REQUESTS BE INCLUDED IN INVITATIONS ONLY WHERE THE MATERIAL IS ESSENTIAL FOR EVALUATION PURPOSES AND THE EXTENT OF THE DESCRIPTIVE DETAIL REQUIRED IS CLEARLY SET OUT.

FOR THE REASONS INDICATED ABOVE, WE FIND NO LEGAL BASIS FOR OBJECTING TO THE ACTIONS OF THE DISTRICT OF COLUMBIA IN REJECTING YOUR BID AND MAKING AN AWARD OF THE CONTRACT TO COPELAND.

ACCORDINGLY, YOUR PROTEST IS DENIED.