B-169952, JUL. 29, 1970

B-169952: Jul 29, 1970

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FRAUD OR FAVORITISM IS EVIDENCED DETERMINATION OF BIDDER RESPONSIBILITY IS NOT SUBJECT TO LEGAL OBJECTION. INC.: FURTHER REFERENCE IS MADE TO YOUR TELEGRAM OF JUNE 2. THE RFQ WAS ISSUED ON MAY 6. PROPOSALS WERE RECEIVED AS FOLLOWS: BIDDER UNIT PRICE NEW KOREA ENTERPRISE CO. INC. 800 PREAWARD SURVEYS WERE MADE BY THE QUALITY AND FACILITIES DIVISION. NO PREAWARD SURVEY WAS MADE OF YOUR FIRM BECAUSE ITS ENGINE REPAIR CAPABILITY HAD BEEN PREVIOUSLY ESTABLISHED. NEGOTIATIONS WERE HELD AT USAPAV ON MAY 25 AND 26. CLARIFICATIONS WERE MADE IN THE RFQ AND THE BIDDERS WERE GIVEN AN OPPORTUNITY TO SUBMIT REVISED PROPOSALS WHICH WERE AS FOLLOWS: BIDDER UNIT PRICE NEW KOREA ENTERPRISE CO. DAJB11-70-C-0170 WAS AWARDED TO NEW KOREA ENTERPRISE CO.

B-169952, JUL. 29, 1970

BID PROTEST -- BIDDER RESPONSIBILITY -- QUALIFICATION DECISION TO APPLIED TECHNICAL SERVICES, INC., THIRD LOW BIDDER DENYING PROTEST AGAINST THE AWARD OF CONTRACT TO NEW KOREA ENTERPRISE CO., LOW BIDDER, FOR REPAIR OF DIESEL FORKLIFT ENGINES FOR U.S. ARMY PROCUREMENT AGENCY, IN VIETNAM. WHERE PREAWARD SURVEY RESULTED IN FINDING THAT LOW OFFEROR HAD TOOLS TO PERFORM CONTRACT AND NO EVIDENCE OF ERROR, FRAUD OR FAVORITISM IS EVIDENCED DETERMINATION OF BIDDER RESPONSIBILITY IS NOT SUBJECT TO LEGAL OBJECTION.

TO APPLIED TECHNICAL SERVICES, INC.:

FURTHER REFERENCE IS MADE TO YOUR TELEGRAM OF JUNE 2, 1970, PROTESTING THE AWARD MADE UNDER REQUEST FOR QUOTATIONS (RFQ) NO. DAJB11 70-Q-0148, ISSUED BY THE U. S. ARMY PROCUREMENT AGENCY, REPUBLIC OF VIETNAM.

THE RFQ WAS ISSUED ON MAY 6, 1970, FOR THE REPAIR OF 15 DETROIT DIESEL, 4 CYLINDER, IN LINE, 53 SERIES FORKLIFT ENGINES, FSN 2815-932 4727, USED IN THE 6,000-POUND ROUGH TERRAIN FORKLIFTS. PROPOSALS WERE RECEIVED AS FOLLOWS:

BIDDER UNIT PRICE

NEW KOREA ENTERPRISE CO., LTD. $385

SMITHCO INTERNATIONAL 618

APPLIED TECHNICAL SERVICES, INC. 800

PREAWARD SURVEYS WERE MADE BY THE QUALITY AND FACILITIES DIVISION, USAPAV, TO DETERMINE THE PERFORMANCE CAPABILITIES OF NEW KOREA ENTERPRISE CO. AND SMITHCO INTERNATIONAL. NO PREAWARD SURVEY WAS MADE OF YOUR FIRM BECAUSE ITS ENGINE REPAIR CAPABILITY HAD BEEN PREVIOUSLY ESTABLISHED. THE PREAWARD SURVEYS DETERMINED THAT BOTH SMITHCO AND NEW KOREA HAD THE CAPABILITY TO PERFORM THE CONTRACT. NEGOTIATIONS WERE HELD AT USAPAV ON MAY 25 AND 26, 1970, WITH ALL BIDDERS. CLARIFICATIONS WERE MADE IN THE RFQ AND THE BIDDERS WERE GIVEN AN OPPORTUNITY TO SUBMIT REVISED PROPOSALS WHICH WERE AS FOLLOWS:

BIDDER UNIT PRICE

NEW KOREA ENTERPRISE CO. NO CHANGE

SMITHCO INTERNATIONAL $512

APPLIED TECHNICAL SERVICES 710 (W/O SPECS.)

790 (USING DYNO.)

CONTRACT NO. DAJB11-70-C-0170 WAS AWARDED TO NEW KOREA ENTERPRISE CO. ON MAY 29, 1970, FOR THE REPAIR OF 15 DIESEL ENGINES.

YOU CONTEND THAT NEW KOREA IS NOT A RESPONSIBLE CONTRACTOR BECAUSE IT HAD NO REPAIR PARTS IN STOCK AND COULD NOT DEMONSTRATE AN ABILITY TO OBTAIN THE REQUIRED REPAIR PARTS IN SUFFICIENT TIME TO MEET THE REQUIRED DELIVERY SCHEDULE; THAT IT DID NOT HAVE A DYNAMOMETER THAT WOULD RUN-IN THE ENGINES ACCORDING TO THE SPECIFICATIONS; AND THAT IT DID NOT HAVE PROPER INSPECTION AND TEST EQUIPMENT AVAILABLE.

ON JUNE 6, 1970, TWO REPRESENTATIVES OF THE QUALITY AND FACILITIES DIVISION OF USAPAV AND TWO REPRESENTATIVES OF THE FIRST LOGISTICAL COMMAND VISITED THE CONTRACTOR'S FACILITY AND THE DYNAMOMETER IN QUESTION TO REVIEW THE VALIDITY OF YOUR PROTEST. A DETERMINATION WAS AGAIN MADE THAT THE DYNAMOMETER TO BE USED BY NEW KOREA ENTERPRISE CO. WOULD PERFORM THE TESTS NECESSARY UNDER THE SPECIFICATIONS AND THAT THE CONTRACTOR POSSESSED THE EQUIPMENT NECESSARY TO PERFORM THE CONTRACT. IN RESPONSE TO YOUR ALLEGATIONS PERTAINING TO REPAIR PARTS, THE ADMINISTRATIVE FINDING IS THAT NO FACTUAL EVIDENCE IS SHOWN THAT NEW KOREA HAS NO REPAIR PARTS IN STOCK, AND FURTHER, THAT A STOCKAGE LEVEL OF REPAIR PARTS IS NOT A REQUIREMENT OF THE CONTRACT. IT WAS FOUND FURTHER THAT REPAIR PARTS ARE AVAILABLE FROM THE DETROIT DIESEL DISTRIBUTOR IN SAIGON. THE CONTRACTOR ALSO INDICATED IN NEGOTIATIONS THAT IT HAD CONTACTS WITH DISTRIBUTORS IN KOREA ABLE TO SUPPLY REPAIR PARTS IN THE REQUIRED TIME FRAME; ALSO THAT IT CAN PURCHASE REPAIR PARTS ON THE LOCAL MARKET IN ITS DISCRETION. IT IS POINTED OUT THAT THERE IS NO CONTRACT PROVISION PROHIBITING LOCAL PURCHASES PROVIDED THEY ARE GENUINE REPAIR PARTS.

WITH RESPECT TO THE DYNAMOMETER, IT IS REPORTED THAT THIS MATTER WAS INVESTIGATED EXTENSIVELY ON THREE SEPARATE OCCASIONS, BOTH BEFORE AND AFTER YOUR PROTEST, AND ALL FINDINGS INDICATE THAT THE DYNAMOMETER TO BE USED BY NEW KOREA CONFORMS TO THE REQUIREMENTS OF THE SPECIFICATIONS.

THE PREAWARD SURVEY DETERMINED THAT THE TOOLS AND INSTRUMENTS POSSESSED BY NEW KOREA WERE SUFFICIENT TO SATISFACTORILY PERFORM THE CONTRACT, AND TWO SUBSEQUENT EXAMINATIONS OF THE CONTRACTOR'S FACILITY BY REPRESENTATIVES OF USAPAV AND THE FIRST LOGISTICAL COMMAND CONFIRMED THE FINDINGS OF THE PREAWARD SURVEY TEAM. AS A CONSEQUENCE, AND IN COMPLIANCE WITH THE PROVISIONS OF PARAGRAPH 1-904.1 OF THE ARMED SERVICES PROCUREMENT REGULATION, THE CONTRACTING OFFICER MADE A FINDING OF RESPONSIBILITY.

IT IS WELL SETTLED THAT THE DETERMINATION OF A BIDDER'S RESPONSIBILITY INVOLVES THE EXERCISE OF A CONSIDERABLE RANGE OF DISCRETION AND OUR OFFICE HAS CONSISTENTLY ADHERED TO THE RULE THAT THE ADMINISTRATIVE DETERMINATION WILL NOT BE QUESTIONED UNLESS ARBITRARY OR CAPRICIOUS. 38 COMP. GEN. 131 (1958); 37 COMP. GEN. 430, 435 (1957). THE DETERMINATION OF RESPONSIBILITY IS A MATTER OF JUDGMENT APPLIED TO MATTERS OF FACT, AND IN THE ABSENCE OF ERROR, FRAUD, OR FAVORITISM, OUR OFFICE WILL ACCEPT THE FINDINGS OF THE CONTRACTING AGENCY. SEE 40 COMP. GEN. 294 (1960). THE PROJECTION OF THE CONTRACTOR'S ABILITY TO PERFORM IS COMMITTED TO THE ADMINISTRATIVE DISCRETION OF THE CONTRACTING OFFICERS SINCE THEY ARE IN THE BEST POSITION TO ASSESS RESPONSIBILITY, AND IT WOULD BE UNREASONABLE TO SUPERIMPOSE OUR JUDGMENT ON THAT OF THE CONTRACTING OFFICERS. SEE 39 COMP. GEN. 705 (1960). SINCE WE FIND NO EVIDENCE OF ERROR, FRAUD, OR FAVORITISM, WE WOULD NOT BE JUSTIFIED IN QUESTIONING THE CONTRACTING OFFICER'S AFFIRMATIVE DETERMINATION OF RESPONSIBILITY.

FOR THE REASONS STATED, WE FIND THAT THE AWARD TO NEW KOREA ENTERPRISE CO., LTD. IS NOT LEGALLY OBJECTIONABLE. YOUR PROTEST IS THEREFORE DENIED.