B-173457(2), NOV 22, 1971

B-173457(2): Nov 22, 1971

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THE PROSPECTIVE CONTRACTORS SHOULD NOT HAVE TO GO THROUGH THE ADDITIONAL STEP OF CONFIRMING THAT THEIR INITIAL PROPOSALS ARE FIRM OFFERS. TO VINNELL CORPORATION: REFERENCE IS MADE TO THE LETTERS OF JUNE 30. PROVIDED: " *** THIS IS A REQUEST FOR INFORMATION. QUOTATIONS FURNISHED ARE NOT OFFERS. IF YOU ARE UNABLE TO QUOTE. PROVIDED: "EACH QUOTER WHOSE TECHNICAL PROPOSAL IS CONSIDERED ACCEPTABLE AFTER TECHNICAL EVALUATIONS WILL BE CONSIDERED FOR AWARD ON THE BASIS OF THEIR PRICE QUOTATION. QUOTERS ARE CAUTIONED TO SUBMIT THEIR LOWEST PRICE QUOTATION WITH THEIR TECHNICAL PROPOSAL SINCE THE GOVERNMENT RESERVES THE RIGHT TO MAKE AN AWARD WITHOUT FURTHER NEGOTIATION.". (ASPR 3-501(B) SEC C (XXI)" PRICE QUOTATIONS AND TECHNICAL PROPOSALS WERE RECEIVED FROM 12 CONCERNS.

B-173457(2), NOV 22, 1971

BID PROTEST - FINAL OFFERS - CORRECT BID FORMS CONCERNING PROTEST BY VINNELL CORPORATION AGAINST REJECTION OF ITS INITIAL OFFER AND SUBSEQUENT AWARD OF A CONTRACT TO PACIFIC ARCHITECTS & ENGINEERS UNDER AN RFQ ISSUED BY THE ARMY PROCUREMENT AGENCY, VIETNAM, FOR MANAGING AND OPERATING A GOVERNMENT-OWNED BUS REPAIR FACILITY. THE COMP. GEN. SUGGESTS THAT IN THE ABSENCE OF SUBSTANTIVE REASONS FOR USING STANDARD FORM 18, THE PROSPECTIVE CONTRACTORS SHOULD NOT HAVE TO GO THROUGH THE ADDITIONAL STEP OF CONFIRMING THAT THEIR INITIAL PROPOSALS ARE FIRM OFFERS. STANDARD FORM 33 SHOULD BE USED WHENEVER POSSIBLE.

TO VINNELL CORPORATION:

REFERENCE IS MADE TO THE LETTERS OF JUNE 30, JULY 8 AND AUGUST 23, 1971, PROTESTING THE AWARD OF A CONTRACT UNDER REQUEST FOR QUOTATIONS (RFQ) NO. DAJB11-71-Q-0217, ISSUED ON MAY 8, 1971, BY THE UNITED STATES ARMY PROCUREMENT AGENCY, VIETNAM (APAV).

THE SOLICITATION REQUESTED QUOTATIONS FOR MANAGING AND OPERATING A GOVERNMENT-OWNED FACILITY FOR REPAIR AND MAINTENANCE OF GOVERNMENT OWNED AND OPERATED BUSES FOR THE PERIOD JULY 1, 1971, THROUGH JUNE 30, 1972.

PARAGRAPH 10 OF STANDARD FORM 18, THE FORM USED IN THIS SOLICITATION, PROVIDED:

" *** THIS IS A REQUEST FOR INFORMATION, AND QUOTATIONS FURNISHED ARE NOT OFFERS. IF YOU ARE UNABLE TO QUOTE, PLEASE SO INDICATE ON THIS FORM AND RETURN IT. THIS REQUEST DOES NOT COMMIT THE GOVERNMENT TO PAY ANY COSTS INCURRED IN THE PREPARATION OR THE SUBMISSION OF THIS QUOTATION, OR TO PROCURE OR CONTRACT FOR SUPPLIES OR SERVICES."

SECTION D-2 OF THE SOLICITATION, ENTITLED "PRICE EVALUATION", PROVIDED:

"EACH QUOTER WHOSE TECHNICAL PROPOSAL IS CONSIDERED ACCEPTABLE AFTER TECHNICAL EVALUATIONS WILL BE CONSIDERED FOR AWARD ON THE BASIS OF THEIR PRICE QUOTATION. QUOTERS ARE CAUTIONED TO SUBMIT THEIR LOWEST PRICE QUOTATION WITH THEIR TECHNICAL PROPOSAL SINCE THE GOVERNMENT RESERVES THE RIGHT TO MAKE AN AWARD WITHOUT FURTHER NEGOTIATION."

SECTION C-10 TITLED "ORDER OF PRECEDENCE" PROVIDES:

"IN THE EVENT OF AN INCONSISTENCY BETWEEN PROVISIONS OF THIS SOLICITATION, THE INCONSISTENCY SHALL BE RESOLVED BY GIVING PRECEDENCE IN THE FOLLOWING ORDER: (A) THE SCHEDULE; (B) SOLICITATION INSTRUCTIONS AND CONDITIONS; (C) OTHER PROVISIONS OF THE CONTRACT; (D) GENERAL PROVISIONS, WHETHER INCORPORATED BY REFERENCE OR OTHERWISE; AND (E) THE SPECIFICATIONS.

(ASPR 3-501(B) SEC C (XXI)"

PRICE QUOTATIONS AND TECHNICAL PROPOSALS WERE RECEIVED FROM 12 CONCERNS. NINE OF THE PROPOSALS RECEIVED WERE FOUND TO BE UNACCEPTABLE FOR VARIOUS REASONS. THE FOLLOWING PROPOSALS WERE FOUND TO BE WITHIN THE COMPETITIVE RANGE:

FIRM NAME TECHNICAL EVAL. RATING ESTIMATED COST FIXED FEE TOTAL

VINNELL CORP. 92 $81,539 $3,262 $84,801

PACIFIC ARCHITECTS

& ENGINEERS (PA&E) 92 $127,059 $6,341 $133,400

PHILCO-FORD CORP. 93 $149,112 $7,456 $156,568

QUOTATIONS WERE ALSO SOLICITED FOR AN ADDITIONAL ITEM - ESTIMATED COST FOR TOOLS, REPAIR PARTS AND SPECIAL EQUIPMENT; HOWEVER, NO FEE WAS TO BE COMPUTED ON THIS ITEM, WHICH WAS ALSO EXCLUDED AS A BASIS FOR EVALUATION.

NEGOTIATIONS WERE CONDUCTED WITH THE ABOVE THREE CONCERNS BEGINNING ON JUNE 8, 1971. DURING THE COURSE OF NEGOTIATIONS, CERTAIN MATTERS RELATING TO MANNING LEVELS, COMPUTATION OF BONUSES, CLARIFICATION OF PROPOSED STAFFING AND SUPERVISORY FUNCTIONS, WERE DISCUSSED WITH EACH OF THE THREE FIRMS. CERTAIN OTHER MATTERS WERE SPECIFICALLY DISCUSSED WITH VINNELL, SUCH AS THE RESPONSIBILITIES TO BE ALLOCATED TO THE SUPERVISOR KNOWN AS THE WORKING FOREMAN, THE PROSPECTIVE METHOD OF DETERMINING BONUSES FOR LOCAL-NATIONAL EMPLOYEES AND THE BASIS FOR VINNELL'S ALLOCATION OF OVERALL SUPPORT COSTS.

TWO COPIES OF AMENDMENT 0001 TO THE SOLICITATION WERE GIVEN TO EACH OF THE ABOVE OFFERORS AT THE CLOSE OF THE NEGOTIATION SESSIONS. THE FORM USED FOR THIS AMENDMENT WAS STANDARD FORM 30, AND THE SUBSTANCE OF THE AMENDMENT WAS AS FOLLOWS:

"SUBMISSION OF REVISED TECHNICAL AND/OR COST PROPOSALS MUST BE RECEIVED AT QUALITY AND FACILITIES DIRECTORATE OF THIS AGENCY NO LATER THAN 1000 HOURS, FRIDAY, 11 JUN 71.

"TO BE CONSIDERED FOR AWARD THE OFFEROR MUST CLEARLY STATE THAT HIS REVISION IS A FIRM OFFER AND IS SUBJECT TO AWARD WITHOUT FURTHER NEGOTIATION.

"ANY REVISIONS RECEIVED AFTER THE TIME SPECIFIED FOR RECEIPT WILL BE SUBJECT TO THE SOLICITATION PROVISION REGARDING LATE QUOTATIONS AND MODIFICATIONS."

THE CONTRACTING OFFICER'S REPORT STATES THAT EACH QUOTER WAS REMINDED THAT THE GOVERNMENT RESERVED THE RIGHT TO MAKE AN AWARD ON THE BASIS OF THE NEW PROPOSALS TO BE SUBMITTED BY THE SPECIFIED DEADLINE AND THAT RESPONSES WERE TO CONTAIN LANGUAGE THAT THEY WERE FIRM OFFERS SUBJECT TO AWARD WITHOUT FURTHER NEGOTIATIONS. THE CONTRACTING OFFICER'S REPORT ADVISES THAT VINNELL SIGNED AMENDMENT 0001 AND INDICATED ITS UNDERSTANDING OF THE AMENDMENT. THE CONTRACTING OFFICER'S REPORT ALSO STATES THAT SEVERAL SIGNIFICANT, QUESTIONABLE ASPECTS OF VINNELL'S TECHNICAL AND COST QUOTATION WAS DISCUSSED DURING THE NEGOTIATION SESSION AND, WHILE NO FINAL RESULT WAS ACHIEVED, VINNELL WAS DISTINCTLY INFORMED THAT THE DEFICIENCIES WOULD HAVE TO BE SATISFACTORILY RESOLVED BEFORE ANY CONTRACT COULD BE AWARDED. WE CONCLUDE, THEREFORE, THAT VINNELL WAS PUT ON NOTICE THAT REGARDLESS OF WHETHER UNDER THE TERMS OF THE RFQ ITS INITIAL QUOTATION COULD HAVE BEEN CONSIDERED AS AN OFFER TO BE ACCEPTED, THE QUOTATION REQUIRED REVISION BEFORE IT COULD BE REGARDED AS ACCEPTABLE TO THE CONTRACTING ACTIVITY. SPECIFICALLY, DEFICIENCIES WERE FOUND IN THE QUOTATION AS TO THE RESPONSIBILITIES OF THE ON-SITE MANAGER, ASSURANCE OF ADEQUATE SUPERVISION OF MAINTENANCE AREAS AND SOURCES OF TOOLS WHICH WERE NOT AVAILABLE FROM GOVERNMENT SOURCES.

THE CONTRACTING OFFICER'S REPORT SUMMARIZES THE FOLLOWING EVENTS WHICH TRANSPIRED SUBSEQUENT TO NEGOTIATIONS WITH THE THREE CONCERNS:

"5. TIMELY OFFERS CONTAINING THE ABOVE LANGUAGE (RELATING TO FIRM AND FINAL OFFERS) WERE RECEIVED FROM PHILCO-FORD AND PA&E. NO RESPONSE WAS RECEIVED FROM VINNELL PRIOR TO THE AMENDED CLOSING TIME. SEVERAL ATTEMPTS WERE MADE BY THE CONTRACT SPECIALIST, MR. CHARLES J. NOBES, TO CONTACT REPRESENTATIVES OF VINNELL VIA TELEPHONE IN THE INTERIM BETWEEN THE AMENDED CLOSING TIME AND 13 JUNE TO ASCERTAIN ITS INTEREST, OR LACK THEREOF, IN THE REQUIREMENT *** . HOWEVER, ALL SUCH ATTEMPTS WERE UNSUCCESSFUL BECAUSE, AS LATER LEARNED, THE FIRM WAS RELOCATING ITS OFFICES DURING THE PERIOD INVOLVED AND NEGLECTED TO MAINTAIN NORMAL LINES OF COMMUNICATION.

"6. TOTAL PRICE ESTIMATES CONTAINED IN THE TWO FINAL, FIRM OFFERS WERE:

FIRM NAME ESTIMATED COST FIXED FEE TOTAL CPFF

PA&E $98,628 $4,950 $103,578

PHILCO-FORD $149,112 $7,456 $156,568

INASMUCH AS PA&E'S TOTAL ESTIMATED COST-PLUS-FIXED-FEE FIGURE WAS OBTAINED THROUGH ADEQUATE PRICE COMPETITION *** , THE CONTRACTING OFFICER, WITH THE RECOMMENDATION OF A PRE-AWARD REVIEW BOARD AND THE APPROVAL OF THE COMMANDNG OFFICER, USAPAV, AWARDED CONTRACT NO. DAJB11 71-C-0308 TO PA&E ON 18 JUNE 1971 *** ."

ON JUNE 13, SUBSEQUENT TO THE JUNE 11 DATE FOR CLOSE OF NEGOTIATIONS BUT PRIOR TO AWARD, THE CONTRACTING OFFICER ADVISED THE VINNELL REPRESENTATIVE THAT ITS INITIAL PROPOSAL COULD NOT BE CONSIDERED AS A FIRM AND FINAL OFFER, AND THAT ANY FURTHER SUBMISSION BY VINNELL WOULD HAVE TO BE TREATED IN ACCORDANCE WITH THE PROVISIONS RELATING TO LATE MODIFICATIONS. LETTERS DATED JUNE 14 AND 19, 1971, TO THE APAV, VINNELL URGED THAT ITS INITIAL QUOTATION WAS, IN FACT, A FIRM OFFER WHICH SHOULD BE CONSIDERED FOR AN AWARD.

SEVERAL ARGUMENTS HAVE BEEN PRESENTED CONCERNING THE INTERPRETATION TO BE GIVEN TO THE ABOVE-QUOTED CLAUSES. OUR VIEWS ON THESE ARGUMENTS ARE SET FORTH IN OUR ENCLOSED LETTER TO THE SECRETARY OF THE ARMY.

WHETHER A COMMUNICATION BY ONE PARTY TO ANOTHER IS AN OPERATIVE OFFER CREATING A POWER OF ACCEPTANCE, OR MERELY A PRELIMINARY NEGOTIATION, IS A MATTER OF INTERPRETATION TO BE ASCERTAINED IN THE LIGHT OF ALL THE SURROUNDING CIRCUMSTANCES. 37 COMP. GEN. 258 (1957). SUCH INTERPRETATION INVOLVES NOT MERELY THE WORDS USED, BUT THE MEANING INTENDED BY THE PARTY USING THEM, AND THE MEANING WHICH HE KNEW OR HAD REASON TO ANTICIPATE WOULD BE PLACED ON THEM BY THE OTHER PARTY. OUR OFFICE FOUND UPON REVIEW OF THE REQUEST FOR QUOTATIONS FORM USED IN THE CITED CASE, WHICH DIFFERED FROM THE FORM USED HERE, THAT THE LANGUAGE WAS BY NO MEANS SO CLEAR AS TO PRECLUDE ITS USE TO REQUEST A BINDING OFFER. IN THE CITED CASE IT APPARENTLY HAD BEEN THE UNDERSTANDING OF MANY CONTRACTING AND PURCHASING OFFICIALS THAT A PURCHASE ORDER CONSTITUTED AN EFFECTIVE ACCEPTANCE OF A PROPOSAL SUBMITTED IN RESPONSE TO A REQUEST FOR QUOTATIONS. WE STATED IN THAT DECISION THAT ARMY'S PROCUREMENT PERSONNEL SHOULD BE INSTRUCTED THAT A PURCHASE ORDER ISSUED UNDER A REQUEST FOR QUOTATIONS WAS MERELY AN OFFER, WHICH MUST BE ACCEPTED EITHER BY EXPRESS CONSENT OR BY PERFORMANCE OF THE PROSPECTIVE CONTRACTOR. OUR DECISION, B-163898, JUNE 6, 1968, APPLIED THE RULE THAT THE ISSUANCE OF A PURCHASE ORDER BY THE GOVERNMENT TO A CONCERN WHICH HAD RESPONDED TO A REQUEST FOR QUOTATIONS DOES NOT CREATE A BINDING CONTRACT.

IN OUR ENCLOSED LETTER TO THE ARMY WE HAVE INDICATED THAT THERE WERE APPARENT INCONSISTENCIES IN THE TERMS OF THE SOLICITATION WITH RESPECT TO WHETHER FIRM OFFERS OR QUOTATIONS WERE BEING SOLICITED. IN OUR OPINION, REQUIRING ACKNOWLEDGMENT DURING NEGOTIATIONS THAT THE QUOTES SUBMITTED ARE FIRM OFFERS DOES NOT REPRESENT THE BEST POSSIBLE RESOLUTION OF THE PROBLEM.

REQUIRING CONFIRMATION THAT YOUR QUOTE WAS A FIRM OFFER, WOULD BE CONSISTENT WITH OUR DECISIONS WHICH INDICATE THAT A MERE QUOTE CANNOT BE ACCEPTED BY THE ISSUANCE OF A PURCHASE ORDER. WE THINK ENOUGH INFORMATION WAS FURNISHED TO YOU DURING THE NEGOTIATION SESSION TO RAISE THE PRESUMPTION THAT YOU WERE ON NOTICE THAT FURTHER COMMUNICATIONS WERE EXPECTED FROM YOUR CONCERN. ANY QUESTIONS AS TO WHAT WAS EXPECTED COULD HAVE BEEN RESOLVED DURING THE NEGOTIATION SESSION. WE HAVE NO REASON TO DOUBT THE CONTRACTING OFFICER'S STATEMENT THAT SEVERAL UNSUCCESSFUL ATTEMPTS WERE MADE TO CONTACT YOU BETWEEN THE CLOSE OF THE NEGOTIATION SESSION AND THE JUNE 11 DEADLINE FOR REVISED PROPOSALS. CHANGING A PROPOSAL FROM A QUOTE TO A FIRM OFFER WOULD CONSTITUTE A REVISION OF A PROPOSAL. THEREFORE, WE FIND MERIT IN THE CONTRACTING OFFICER'S POSITION THAT YOUR LETTERS FURNISHED AFTER THE JUNE 11 DEADLINE SHOULD BE CONSIDERED IN ACCORDANCE WITH THE PROVISIONS IN THE SOLICITATION DEALING WITH LATE QUOTATIONS. NEVERTHELESS, WE DO NOT BELIEVE IT IS NECESSARY TO DECIDE THE ISSUE IN THIS CASE IN VIEW OF THE ADMINISTRATIVE DETERMINATION ALREADY NOTED THAT AN AWARD COULD NOT BE MADE ON THE BASIS OF YOUR INITIAL QUOTATION BECAUSE OF THE DEFICIENCIES IN IT, EVEN IF THE RFQ SHOULD BE SO INTERPRETED AS TO PERMIT THE CREATION OF A BINDING CONTRACT BY ACCEPTANCE OF AN INITIAL QUOTATION.

WE AGREE THAT THE TERMS OF THE AMENDMENT TO A SUBSEQUENT PROCUREMENT BY APAV WHICH WAS ENCLOSED WITH YOUR LETTER OF AUGUST 23, MORE CLEARLY ADVISED QUOTERS OF WHAT WAS REQUIRED; HOWEVER, WE DO NOT FIND THAT A DIFFERENT CONCLUSION IS THEREBY REQUIRED IN THIS CASE.

IN ACCORDANCE WITH THE FOREGOING, YOUR PROTEST IS DENIED.