B-171424, MAR 1, 1971

B-171424: Mar 1, 1971

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AGAINST ADMINISTRATIVE DETERMINATION THAT ITS BID TO FURNISH HAMPER DUMPERS TO THE POST OFFICE DEPARTMENT WAS NONRESPONSIVE. TO MRC CORPORATION: REFERENCE IS MADE TO YOUR LETTER OF JANUARY 4. THE INVITATION STATED THAT THE QUANTITY IN ITEM IV WAS ESTIMATED ONLY AND THAT POD RESERVED THE RIGHT TO ORDER MORE OR LESS. DURING THE PERIOD BEGINNING WITH THE DATE THE PREPRODUCTION SAMPLE WAS APPROVED. WHICHEVER WAS MOST ADVANTAGEOUS TO THE GOVERNMENT. SIX BIDS WERE OPENED NOVEMBER 9. THE UNIT PRICES BID ON ITEM III WERE AS FOLLOWS: BIDDER UNIT PRICE MRC CORPORATION $2. 338.94 THE CONTRACTING OFFICER DECIDED THAT MRC'S BID WAS NONRESPONSIVE DUE TO ITS FAILURE TO ACKNOWLEDGE RECEIPT OF AMENDMENT 1.

B-171424, MAR 1, 1971

BID PROTEST - BID RESPONSIVENESS DECISION DENYING PROTEST BY MRC CORPORATION LOW BIDDER, AGAINST ADMINISTRATIVE DETERMINATION THAT ITS BID TO FURNISH HAMPER DUMPERS TO THE POST OFFICE DEPARTMENT WAS NONRESPONSIVE. AN AMENDMENT TO THE SOLICITATION WHICH ALLOWS THE GOVERNMENT TO PURCHASE ADDITIONAL QUANTITIES THAT IT MIGHT REQUIRE AND RELIEVING ITSELF OF THE OBLIGATION TO DO SO AS THE ORIGINAL LIMITATION PROVIDED, SO MATERIALLY CHANGES THE ADVERTISED REQUIREMENTS OF THE IFB THAT THE AMENDMENT MUST BE ACKNOWLEDGED BY ALL BIDDERS, AND PROTESTANT'S FAILURE TO DO SO MUST RENDER ITS BID NONRESPONSIVE.

TO MRC CORPORATION:

REFERENCE IS MADE TO YOUR LETTER OF JANUARY 4, 1971, AND PRIOR CORRESPONDENCE, PROTESTING AWARD OF ITEM III OF INVITATION FOR BIDS (IFB) NO. 3050 BY THE POST OFFICE DEPARTMENT (POD), BUREAU OF FACILITIES, OFFICE OF PROCUREMENT, SUPPLY DIVISION, WASHINGTON, D.C., TO A BIDDER OTHER THAN THE MRC CORPORATION.

THE IFB, ISSUED OCTOBER 8, 1970, SOLICITED BIDS ON FOUR ITEMS OF HAMPER DUMPERS. ITEM III SOLICITED F.O.B. DESTINATION BIDS ON 25 HAMPER DUMPERS PER POD SPECIFICATION POD-H-418(RE). ITEM IV SOLICITED BIDS ON AN ADDITIONAL SIX UNITS IN ACCORDANCE WITH THE SAME SPECIFICATION. THE INVITATION STATED THAT THE QUANTITY IN ITEM IV WAS ESTIMATED ONLY AND THAT POD RESERVED THE RIGHT TO ORDER MORE OR LESS, AS REQUIRED, DURING THE PERIOD BEGINNING WITH THE DATE THE PREPRODUCTION SAMPLE WAS APPROVED, AND ENDING DECEMBER 31, 1971. THE INVITATION FURTHER PROVIDED THAT AWARD WOULD BE MADE FOR ITEMS I AND II COMBINED AND FOR ITEMS III AND IV COMBINED, OR FOR ALL FOUR ITEMS COMBINED, WHICHEVER WAS MOST ADVANTAGEOUS TO THE GOVERNMENT.

AMENDMENT 1 TO THE IFB, ISSUED OCTOBER 21, 1970, ADVISED WHERE A PROTOTYPE OF ITEM III COULD BE EXAMINED BY BIDDERS; DELETED ITEMS II AND IV FROM THE INVITATION; EXTENDED DELIVERY TIME FROM 60 TO 120 DAYS AFTER ACCEPTANCE OF THE PREPRODUCTION MODEL; REVISED THE METHOD OF AWARD TO REFLECT THE DELETION OF ITEMS II AND IV; PROVIDED THAT BIDDERS, IF THEY DESIRED, COULD OFFER A 20-PERCENT ADDITIONAL QUANTITY OPTION FOR ITEMS I AND III AT THEIR QUOTED BID PRICES; AND INCREASED THE QUANTITY OF ITEM III FROM 25 TO 26 UNITS.

SIX BIDS WERE OPENED NOVEMBER 9, 1970, AND THE UNIT PRICES BID ON ITEM III WERE AS FOLLOWS:

BIDDER UNIT PRICE

MRC CORPORATION $2,630.00

CUSTOM CONTROLS COMPANY $2,864.36

ENGINEERED PRODUCTS COMPANY $2,994.00

STEWART-GLAPAT CORPORATION $4,527.55

MELLO CONSULTANTS $5,200.00

UHRDEN, INC. $5,338.94 THE CONTRACTING OFFICER DECIDED THAT MRC'S BID WAS NONRESPONSIVE DUE TO ITS FAILURE TO ACKNOWLEDGE RECEIPT OF AMENDMENT 1.

YOU CONTEND THAT THE FAILURE TO ACKNOWLEDGE THE AMENDMENT SHOULD HAVE BEEN WAIVED PURSUANT TO SECTION 10(B) OF STANDARD FORM 33A WHICH PROVIDES THAT "THE GOVERNMENT RESERVES THE RIGHT TO REJECT ANY OR ALL OFFERS AND TO WAIVE INFORMALITIES AND MINOR IRREGULARITIES IN OFFERS RECEIVED." FURTHER, YOU REFER TO SECTION 1-2.405 OF THE FEDERAL PROCUREMENT REGULATIONS:

"A MINOR INFORMALITY OR IRREGULARITY IS ONE WHICH IS MERELY A MATTER OF FORM AND NOT OF SUBSTANCE OR PERTAINS TO SOME IMMATERIAL OR INCONSEQUENTIAL DEFECT OR VARIATION OF A BID FROM THE EXACT REQUIREMENT OF THE INVITATION FOR BIDS, THE CORRECTION OR WAIVER OF WHICH WOULD NOT BE PREJUDICIAL TO OTHER BIDDERS. THE DEFECT OR VARIATION IN THE BID IS IMMATERIAL AND INCONSEQUENTIAL WHEN ITS SIGNIFICANCE AS TO PRICE, QUANTITY, QUALITY, OR DELIVERY IS TRIVIAL OR NEGLIGIBLE WHEN CONTRASTED WITH THE TOTAL COST OR SCOPE OF THE SUPPLIES OR SERVICES BEING PROCURED. THE CONTRACTING OFFICER SHALL EITHER GIVE THE BIDDER AN OPPORTUNITY TO CURE ANY DEFICIENCY RESULTING FROM A MINOR INFORMALITY OR IRREGULARITY IN A BID OR WAIVE SUCH DEFICIENCY, WHICHEVER IS TO THE ADVANTAGE OF THE GOVERNMENT. EXAMPLES OF MINOR INFORMALITIES OR IRREGULARITIES INCLUDE:

"(D) FAILURE OF A BIDDER TO ACKNOWLEDGE RECEIPT OF AN AMENDMENT TO AN INVITATION FOR BIDS, BUT ONLY IF:

"(2) THE AMENDMENT INVOLVES ONLY A MATTER OF FORM OR IS ONE WHICH HAS EITHER NO EFFECT OR MERELY A TRIVIAL OR NEGLIGIBLE EFFECT ON PRICE, QUANTITY, QUALITY, OR DELIVERY OF THE ITEM BID UPON."

ALTHOUGH A MATERIAL DEVIATION IN BID ORDINARILY IS CONSIDERED TO BE AN IRREGULARITY HAVING MORE THAN A TRIVIAL OR NEGLIGIBLE EFFECT ON PRICE, QUANTITY, QUALITY, OR DELIVERY, AN IRREGULARITY IN A BID RESULTING IN BENEFITS TO A BIDDER NOT EXTENDED TO ALL BIDDERS IS A VARIANCE RENDERING THE BID NONRESPONSIVE. 39 COMP. GEN. 259 (1959); 37 ID. 110 (1957); AND 36 ID. 535 (1957).

FURTHER EXPLANATION FOR THE RULE REQUIRING REJECTION OF BIDS THAT FAIL TO ACKNOWLEDGE AMENDMENTS CREATING SUBSTANTIVE CHANGES IN THE IFB IS FOUND IN B-150563, FEBRUARY 28, 1963, AS FOLLOWS:

" *** THE REASON FOR THE RULE IS THAT A BID SUBMITTED IN RESPONSE TO AN INVITATION ISSUED BY AN AGENCY OF THE GOVERNMENT CONSTITUTES AN OFFER; THE AWARD IS AN ACCEPTANCE WHICH EFFECTS A BINDING AGREEMENT BETWEEN THE TWO PARTIES. IT IS WELL RECOGNIZED THAT AN OFFER IS TO BE INTERPRETED IN ACCORDANCE WITH ITS CLEAR LANGUAGE. THE ACCEPTANCE OF A BID WHICH OFFERS TO PERFORM ON A BASIS OTHER THAN THE TERMS OF THE INVITATION INCLUDING ANY AMENDMENTS WOULD BE CONTRARY TO THE STATUTES GOVERNING ADVERTISED PROCUREMENTS. UNITED STATES V ELLICOTT, 223 U.S. 524 (1911). *** "

IN LIGHT OF THE FOREGOING, IT IS OUR VIEW THAT THE AMENDMENT MATERIALLY CHANGED THE ADVERTISED REQUIREMENTS OF THE IFB AND THAT THE FAILURE OF MRC TO ACKNOWLEDGE THE AMENDMENT RENDERED ITS BID NONRESPONSIVE. THIS CONCLUSION IS BASED ON THE FACT THAT A CONTRACT RESULTING FROM THE ORIGINAL INVITATION WOULD HAVE REQUIRED THE GOVERNMENT TO PROCURE FROM THE SUCCESSFUL CONTRACTOR THROUGH DECEMBER 31, 1971, ALL OF ITS NEEDS FOR HAMPER DUMPERS PER POD SPECIFICATION POD H-418(RE) IN EXCESS OF 25 UNITS, WHICH NEEDS WERE ESTIMATED AT SIX UNITS IN ITEM IV, WHEREAS, UNDER A CONTRACT AWARDED IN ACCORDANCE WITH THE AMENDED INVITATION, THE GOVERNMENT WOULD HAVE THE SOLE RIGHT TO DETERMINE WHETHER IT WOULD PURCHASE AN ADDITIONAL 20 PERCENT OF ITEM III AT THE BID PRICE FOR THAT ITEM AND THEN ONLY IF THE CONTRACTOR PROVIDED FOR SUCH AN OPTION IN ITS BID. IT IS APPARENT FROM THE AMENDMENT THAT ALTHOUGH POD WAS ATTEMPTING TO OBTAIN AN OPTION TO PURCHASE ADDITIONAL QUANTITIES THAT IT MIGHT REQUIRE OVER AND ABOVE ITEM III, IT WAS BY NO MEANS OBLIGATING ITSELF TO DO SO AS THE ORIGINAL INVITATION PROVIDED. THEREFORE, WE VIEW THE BID WITHOUT THE AMENDMENT AS A BID IMPOSING UPON POD A LIABILITY THAT THE DEPARTMENT OBVIOUSLY DID NOT INTEND TO ASSUME. BECAUSE OF THIS CONCLUSION, IT IS NOT NECESSARY TO CONSIDER WHETHER THE OTHER CHANGES INCLUDED IN THE AMENDMENT WERE LIKEWISE MATERIAL.

YOU FURTHER CONTEND THAT PARAGRAPH 10(C) OF STANDARD FORM 33A WOULD HAVE PERMITTED AN AWARD TO YOU FOR A QUANTITY LESS THAN THAT SPECIFIED IN THE IFB. IN THAT CONNECTION, YOU REFER TO THE STATEMENT IN PARAGRAPH 10(C) WHICH PROVIDES THAT "UNLESS OTHERWISE PROVIDED IN THE SCHEDULE, OFFERS MAY BE SUBMITTED FOR ANY QUANTITIES LESS THAN THOSE SPECIFIED; AND THE GOVERNMENT RESERVES THE RIGHT TO MAKE AN AWARD ON ANY ITEM FOR A QUANTITY LESS THAN THE QUANTITY OFFERED AT THE UNIT PRICES OFFERED UNLESS THE OFFEROR SPECIFIES OTHERWISE IN HIS OFFER." YOU STATE FURTHER THAT POD NOTICE 70, DATED MARCH 1970, AWARD OF CONTRACT, CHANGES THE PHRASE "UNLESS OTHERWISE PROVIDED IN THE SCHEDULE" IN ARTICLE 10(C) ABOVE TO "WHEN SPECIFIED IN THE SOLICITATION," AND YOU INQUIRE AS TO THE MEANING OF THE CHANGE AND WHETHER IT WAS DULY APPROVED.

POD HAS ADVISED THAT BEFORE MAKING THE CHANGE IN PARAGRAPH 10(C) A PART OF ITS STANDARD FORM, IT REPORTED THE CHANGE TO THE GENERAL SERVICES ADMINISTRATION WHICH ADVISED THAT SINCE THERE DID NOT APPEAR TO BE ANY SUBSTANTIVE CHANGE ACHIEVED BY THE PROPOSED REVISION IT SEEMED PREFERABLE TO DELETE THE REVISION. HOWEVER, THE DEPARTMENT HAS ADVISED FURTHER THAT SINCE NO SUBSTANTIVE CHANGE WAS DEEMED TO BE ACHIEVED BY THE REVISION, BECAUSE IT MERELY CONSTITUTED THE EXERCISE OF THE RIGHT PROVIDED BY THE LANGUAGE OF PARAGRAPH 10(C) TO PROVIDE THAT OFFERS MUST NOT BE SUBMITTED FOR QUANTITIES LESS THAN THE SPECIFIED QUANTITY, IT ADOPTED THE METHOD OF SPECIFYING THAT REQUIREMENT BY REVISING STANDARD FORM 33A THROUGH POD STANDARD NOTICE 70 INSTEAD OF TYPING A STATEMENT IN EACH SOLICITATION THAT OFFERS MUST NOT BE SUBMITTED FOR QUANTITIES LESS THAN THE SPECIFIED QUANTITY. SINCE UNDER PARAGRAPH 10(C) OF STANDARD FORM 33A, AS UNAMENDED, POD COULD PROVIDE IN EACH SOLICITATION FOR OFFERS BEING SUBMITTED ONLY ON THE QUANTITIES STATED IN THE SOLICITATION, IT IS OF NO SIGNIFICANCE THAT THE DEPARTMENT CHOSE TO IMPOSE SUCH A LIMITATION ON AN ACROSS-THE-BOARD BASIS THROUGH THE USE OF A DEPARTMENTAL STANDARD NOTICE.

SINCE THE LANGUAGE OF PARAGRAPH 10(C) OF STANDARD FORM 33A, AS AMENDED BY POD NOTICE 70, PROVIDES THAT "WHEN SPECIFIED IN THE SOLICITATION, OFFERS MAY BE SUBMITTED FOR ANY QUANTITIES LESS THAN THOSE SPECIFIED; AND THE GOVERNMENT RESERVES THE RIGHT TO MAKE AN AWARD ON ANY ITEM FOR A QUANTITY LESS THAN THE QUANTITY OFFERED AT THE UNIT PRICES OFFERED," IT FOLLOWS AS A COROLLARY THAT WHEN NOT SPECIFIED IN THE SOLICITATION, OFFERS MAY NOT BE SUBMITTED FOR ANY QUANTITIES LESS THAN THOSE SPECIFIED AND THE GOVERNMENT DOES NOT HAVE THE RIGHT TO MAKE AN AWARD FOR QUANTITIES LESS THAN THOSE SPECIFIED. IN LIGHT OF THE FOREGOING, IT IS OUR VIEW THAT THE BID FROM MRC PROPERLY WAS DETERMINED TO BE NONRESPONSIVE.

ACCORDINGLY, THE PROTEST IS DENIED.