B-182968, APR 17, 1975

B-182968: Apr 17, 1975

Additional Materials:

Contact:

Edda Emmanuelli Perez
(202) 512-2853
EmmanuelliPerezE@gao.gov

 

Office of Public Affairs
(202) 512-4800
youngc1@gao.gov

WHICHEVER WAS LESS. CONTENDS THAT BID BOND PROVISION OF SOLICITATION WAS "PRINTED AND/OR DEFACED" IN SUCH A MANNER AS TO APPEAR TO REQUIRE ONLY $3. 000 FIGURE WAS CLEARLY LEGIBLE. CONTENTION THAT ERROR IS HARMLESS IS REJECTED. WAS ISSUED BY THE PURCHASING AND CONTRACTING DIVISION. BIDS WERE OPENED ON DECEMBER 13. MAJESTIC WINDOW CLEANING COMPANY (MAJESTIC) WAS THE LOWEST BIDDER. 456.00 WAS ACCOMPANIED BY A BID BOND OF $3. WHICHEVER IS LESSER. MAJESTIC'S BID WAS REJECTED AS BEING NONRESPONSIVE PURSUANT TO PARAGRAPH J-2 OF THE SOLICITATION WHICH PROVIDED IN PERTINENT PART: "BID GUARANTEE (1964 JUN) (ASPR 7-2003.25) "WHERE A BID GUARANTEE IS REQUIRED BY THE INVITATION FOR BIDS. AWARD WAS MADE TO THE NEXT LOWEST BIDDER.

B-182968, APR 17, 1975

LOW BIDDER, DECLARED NONRESPONSIVE BECAUSE $3,000 BID BOND FAILED TO MEET REQUISITE 20 PERCENT OF BID PRICE OR $3,000,000, WHICHEVER WAS LESS, CONTENDS THAT BID BOND PROVISION OF SOLICITATION WAS "PRINTED AND/OR DEFACED" IN SUCH A MANNER AS TO APPEAR TO REQUIRE ONLY $3,000 BOND. REVIEW OF PHOTOSTATIC COPY OF PROVISION INDICATES THAT $3,000,000 FIGURE WAS CLEARLY LEGIBLE. CONTENTION THAT ERROR IS HARMLESS IS REJECTED, AS FAILURE TO MEET BID BOND REQUIREMENTS REQUIRES REJECTION OF BID, SUBJECT TO EXCEPTIONS INAPPLICABLE TO THE INSTANT CASE.

MAJESTIC WINDOW CLEANING COMPANY:

INVITATION FOR BIDS DAAG 36-75-B-0020, WAS ISSUED BY THE PURCHASING AND CONTRACTING DIVISION, NEW CUMBERLAND ARMY DEPOT, NEW CUMBERLAND, PENNSYLVANIA, FOR CALENDAR YEAR 1975 CUSTODIAL SERVICES.

BIDS WERE OPENED ON DECEMBER 13, 1974, AND MAJESTIC WINDOW CLEANING COMPANY (MAJESTIC) WAS THE LOWEST BIDDER. MAJESTIC'S BID OF $147,456.00 WAS ACCOMPANIED BY A BID BOND OF $3,000, AN AMOUNT SUBSTANTIALLY BELOW THAT REQUIRED BY PARAGRAPH C-39 OF THE SOLICITATION, WHICH STATED:

"EACH BIDDER SHALL SUBMIT WITH HIS BID A BID BOND (STANDARD FORM 24) WITH GOOD AND SUFFICIENT SURETY OR SURETIES ACCEPTABLE TO THE GOVERNMENT OR OTHER SECURITY AS PROVIDED IN SPECIAL PROVISIONS SECTION J CLAUSE 2, BID GUARANTEE (1964 JUN), IN THE FORM OF TWENTY-PERCENT (20%) OF THE BID PRICE, OR $3,000,000, WHICHEVER IS LESSER. THE BID BOND PENALTY MAY BE EXPRESSED IN TERMS OF A PERCENTAGE OF THE BID PRICE OR MAY BE EXPRESSED IN DOLLARS AND CENTS."

MAJESTIC'S BID WAS REJECTED AS BEING NONRESPONSIVE PURSUANT TO PARAGRAPH J-2 OF THE SOLICITATION WHICH PROVIDED IN PERTINENT PART:

"BID GUARANTEE (1964 JUN) (ASPR 7-2003.25)

"WHERE A BID GUARANTEE IS REQUIRED BY THE INVITATION FOR BIDS, FAILURE TO FURNISH A BID GUARANTEE IN THE PROPER FORM AND AMOUNT, BY THE TIME SET FOR OPENING OF BIDS, MAY BE CAUSE FOR REJECTION OF THE BID."

AWARD WAS MADE TO THE NEXT LOWEST BIDDER, SUBURBAN INDUSTRIAL MAINTENANCE COMPANY.

COUNSEL FOR MAJESTIC CONTENDS THAT REJECTION OF MAJESTIC'S BID AS NONRESPONSIVE WAS IMPROPER. COUNSEL ASSERTS THAT MAJESTIC COMPLIED WITH THE REQUIREMENTS OF PARAGRAPH C-39, SINCE MAJESTIC'S COPY OF THE PARAGRAPH WAS "PRINTED AND/OR DEFACED" TO GIVE THE APPEARANCE OF REQUIRING ONLY A $3,000 BID BOND. COUNSEL FURTHER ASSERTS THAT IF THE INTENDED FIGURE WAS $3,000,000, THE PARAGRAPH DID NOT CLEARLY SO INDICATE, AND ANY ERROR MAJESTIC COMMITTED WAS HARMLESS AND CAUSED BY THE CONTRACTING AGENCY. MAJESTIC HAS OFFERED TO SUBSTITUTE AN ADDITIONAL BOND IF SO DIRECTED.

IN SUPPORT OF ITS CONTENTION THAT PARAGRAPH C-39 OF ITS COPY OF THE SOLICITATION WAS "PRINTED AND/OR DEFACED" TO GIVE THE APPEARANCE OF REQUIRING ONLY A $3,000 BID BOND, MAJESTIC HAS SUBMITTED A PHOTOSTATIC COPY OF ITS COPY OF THIS PARAGRAPH TO OUR OFFICE. WE HAVE EXAMINED THIS SUBMISSION AND CONCLUDE THAT THE VERTICAL PRINTED LINE OF THE STANDARD FORM 36 CONTINUATION SHEET WHICH INTERSECTS ONE OF THE ZEROES OF THE FIGURE DOES NOT CREATE THE APPEARNCE OF A FIGURE OTHER THAN $3,000,000.

WITH REGARD TO MAJESTIC'S ASSERTION THAT ANY ERROR IT COMMITTED WAS HARMLESS AND SHOULD BE WAIVED, OUR OFFICE HAS CONSISTENTLY HELD SINCE 38 COMP. GEN. 532 (1959) THAT A BID GUARANTEE REQUIREMENT IN AN INVITATION FOR BIDS IS MATERIAL, AND THE PROCURING AGENCY CANNOT WAIVE A FAILURE TO COMPLY WITH THAT REQUIREMENT, BUT MUST REJECT AS NONRESPONSIVE A BID NOT ACCOMPANIED BY A BID GUARANTEE IN THE REQUIRED FORM AND AMOUNT. THE BASIS FOR THIS RULE WAS STATED IN THAT DECISION AS FOLLOWS:

"*** PERMITTING WAIVER OF A BID BOND REQUIREMENT STATED IN AN INVITATION FOR BIDS WOULD HAVE A TENDENCY TO COMPROMISE THE INTEGRITY OF THE COMPETITIVE BID SYSTEM BY (1) MAKING IT POSSIBLE FOR A BIDDER TO DECIDE AFTER OPENING WHETHER OR NOT TO TRY TO HAVE HIS BID REJECTED, (2) CAUSING UNDUE DELAY IN EFFECTING PROCUREMENTS, AND (3) CREATING, BY THE NECESSARY SUBJECTIVE DETERMINATIONS BY DIFFERENT CONTRACTING OFFICERS, INCONSISTENCIES IN THE TREATMENT OF BIDDERS. THE NET EFFECT OF THE FOREGOING WOULD BE DETRIMENTAL TO FULLY RESPONSIVE AND RESPONSIBLE BIDDERS, AND COULD TEND TO DRIVE THEM OUT OF COMPETITION IN THOSE AREAS WHERE THE PRACTICES DESCRIBED OCCUR. THIS RESULT COULD HARDLY BE SAID TO SERVE THE BEST INTERESTS OF THE UNITED STATES. ***"

FURTHERMORE, ARMED SERVICES PROCUREMENT REGULATION SEC. 10-102.5 (1974 ED.) LIMITS WAIVER OF THE BID BOND REQUIREMENT TO SPECIFIC CIRCUMSTANCES NOT FOUND HERE.

THUS, WE HAVE FOUND NO LEGAL BASIS TO WAIVE BID GUARANTEE REQUIREMENTS EVEN IN INSTANCES WHERE FAILURE TO MEET THESE REQUIREMENTS WAS DUE TO GOVERNMENT ERROR. B-175477, AUGUST 3, 1972. MAJESTIC ALLEGES THAT IT WAS ADVISED BY THE CONTRACTING OFFICER AFTER BID OPENING THAT IT WAS THE LOW BIDDER, AND ARGUES THEREFROM THAT THE BID BOND REQUIREMENT WAS WAIVED. CANNOT ACCEPT MAJESTIC'S ARGUMENT, WHICH WOULD BE CONTRARY TO THE RULE THAT A BID MAY NOT BE CHANGED AFTER PUBLIC OPENING TO CURE A DEFECT WHICH MAKES THE BID NONRESPONSIVE. B 164067, JUNE 13, 1968. IN VIEW OF THE FACT THAT THE DIFFERENCE BETWEEN MAJESTIC'S BID AND THAT OF THE NEXT LOW BIDDER EXCEEDED MAJESTIC'S BID BOND BY APPROXIMATELY $15,000, WE BELIEVE THE CONTRACTING OFFICER PROPERLY DECLINED TO WAIVE THE DEFICIENCY IN MAJESTIC'S BID.

ACCORDINGLY, MAJESTIC'S PROTEST IS DENIED.