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B-156700, JUN. 15, 1965

B-156700 Jun 15, 1965
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YOU ALLEGED THAT THE LOW BID SUBMITTED BY FEDERAL ELECTRIC WAS NOT RESPONSIVE SINCE IT DID NOT INCLUDE CLAUSES 1 THROUGH 69 OF THE GENERAL PROVISIONS OF THE INVITATION. THE GRAVAMEN OF YOUR REQUEST FOR RECONSIDERATION IS STATED IN YOUR LETTER AS FOLLOWS: "THE FACT REMAINS THAT ASIDE FROM THE GENERAL AND UNIFORM PARAGRAPH NUMBERING OF THE "GENERAL PROVISIONS" OF STANDARD FORM 32. THERE IS NO WAY OF DETERMINING WHICH ARE THE OTHER CLAUSES BEING REFERRED TO IN THE ABOVE CITED PART XXI ON PAGE 39 OF THE SUBJECT IFB. IS CLAUSE 50 IN EVERY CONTRACT ALWAYS "AUDIT - PRICE ADJUSTMENTS (SEPT. 1964). "IS THIS LACK OF UNIFORMITY AND DESIGNATION THE REASON WHY PART XXI SPEAKS OF THE CLAUSES BEING "ATTACHED HERETO AND MADE A PART HEREOF? " WE RESPECTFULLY SUGGEST THAT TOO GREAT AN EMPHASIS WAS PLACED IN YOUR OPINION ON WHAT WE CONTEND TO BE A MIS-READING OF THE FOREGOING PART XXI.

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B-156700, JUN. 15, 1965

TO UNITED STATES UNDERSEAS CABLE CORPORATION:

BY LETTER DATED JUNE 3, 1965, YOU REQUESTED RECONSIDERATION OF OUR DECISION OF JUNE 2, 1965, WHICH DENIED YOUR PROTEST AGAINST ANY AWARD TO THE FEDERAL ELECTRIC CORPORATION UNDER DEPARTMENT OF THE AIR FORCE INVITATION FOR BIDS NO. 08-606-65-106. YOU ALLEGED THAT THE LOW BID SUBMITTED BY FEDERAL ELECTRIC WAS NOT RESPONSIVE SINCE IT DID NOT INCLUDE CLAUSES 1 THROUGH 69 OF THE GENERAL PROVISIONS OF THE INVITATION.

THE GRAVAMEN OF YOUR REQUEST FOR RECONSIDERATION IS STATED IN YOUR LETTER AS FOLLOWS:

"THE FACT REMAINS THAT ASIDE FROM THE GENERAL AND UNIFORM PARAGRAPH NUMBERING OF THE "GENERAL PROVISIONS" OF STANDARD FORM 32, WHICH ADMITTEDLY NEVER CHANGE, THERE IS NO WAY OF DETERMINING WHICH ARE THE OTHER CLAUSES BEING REFERRED TO IN THE ABOVE CITED PART XXI ON PAGE 39 OF THE SUBJECT IFB. FOR EXAMPLE, IS CLAUSE 50 IN EVERY CONTRACT ALWAYS "AUDIT - PRICE ADJUSTMENTS (SEPT. 1964), OR CLAUSE 52 ALWAYS "PRICE REDUCTION FOR DEFECTIVE PRICE ADJUSTMENTS (NOV. 1963), AND SO FORTH?

"IS THIS LACK OF UNIFORMITY AND DESIGNATION THE REASON WHY PART XXI SPEAKS OF THE CLAUSES BEING "ATTACHED HERETO AND MADE A PART HEREOF? " WE RESPECTFULLY SUGGEST THAT TOO GREAT AN EMPHASIS WAS PLACED IN YOUR OPINION ON WHAT WE CONTEND TO BE A MIS-READING OF THE FOREGOING PART XXI, AND THE PROPOSITION "... WHERE A WRITING REFERS TO ANOTHER DOCUMENT, THAT OTHER DOCUMENT, OR SO MUCH OF IT AS IS REFERRED TO, IS TO BE INTERPRETED AS A PART OF THE WRITING.' WE RESPECTFULLY SUGGEST THAT NO SPECIFIC DOCUMENT, IN THIS INSTANCE, THE ... (4) SUCH OTHER CONTRACT PROVISIONS AND SPECIFICATIONS AS ARE ATTACHED OR INCORPORATED BY REFERENCE IN THE SCHEDULE" HAVE BEEN SPECIFICALLY AND CLEARLY REFERRED TO, NOR WERE THEY ATTACHED TO THE FEC BID, NOR WERE THEY INCORPORATED BY REFERENCE ANYWHERE IN THE SCHEDULE.

"IT IS NOT SUFFICIENT TO REFER ONLY TO A LISTING OF CLAUSES DESIGNATED AS BEING "1 THROUGH 69" IN AN INSTANCE WHEREIN ALTHOUGH SOME OF THE SAID CLAUSES (STANDARD FORM 32) DO ALWAYS BEAR THE SAME CLAUSE NUMBER, THE MAJORITY OF SAID CLAUSES ARE UNNUMBERED AND DESIGNATED ONLY BY TITLE UNTIL SUCH TIME AS THE PROCUREMENT OFFICE SELECTS WHICH OF THE MANY EXISTENT "OTHER CLAUSES" IT WISHES TO APPLY TO THE PROCUREMENT, AND THEN SERIALLY NUMBERS THEM. WITHOUT THE AIR FORCE FILE, COULD ANYONE LIST WHICH OF THE MANY AND RANDOM CONTRACT CLAUSES POTENTIALLY APPLICABLE TO A SUPPLY CONTRACT WERE BEING REFERRED TO AS CLAUSES 1 THROUGH 69? WE BELIEVE NOT, AND WE BELIEVE FURTHER THAT THE FOREGOING POINT, WHICH IS THE BASIS OF OUR APPEAL TO YOUR AGENCY HAS BEEN COMPLETELY OVERLOOKED.'

THE COVER PAGE OF THE INVITATION PROVIDED:

"SEALED BIDS IN TRIPLICATE, SUBJECT TO (1) THE TERMS AND CONDITIONS OF THE INVITATION FOR BIDS, (2) THE ATTACHED SCHEDULE, (3) GENERAL PROVISIONS (STANDARD FORM 32, SEPTEMBER 1961 EDITION), WHICH ARE INCORPORATED HEREIN BY REFERENCE, AND (4) SUCH OTHER CONTRACT PROVISIONS AND SPECIFICATIONS AS ARE ATTACHED OR INCORPORATED BY REFERENCE IN THE SCHEDULE, WILL BE RECEIVED AT THE ABOVE OFFICE UNTIL 10 O-CLOCK A.M., EASTERN STANDARD TIME, 18 MARCH 1965 (DATE) AND AT THAT TIME PUBLICLY OPENED, FOR FURNISHING THE SUPPLIES OR SERVICES DESCRIBED IN THE ATTACHED HEDULE.'

WHILE YOU CONCEDE THAT LANGUAGE DOES EXIST IN THE INVITATION FROM WHICH IT COULD BE ARGUED THAT THE GENERAL PROVISIONS MIGHT HAVE BEEN INCORPORATED BY REFERENCE, YOU CONTEND THAT THERE IS NOTHING IN THE INVITATION WHICH WOULD INCORPORATE BY REFERENCE THOSE OTHER CLAUSES OF THE GENERAL PROVISIONS WHICH WERE ALTERATIONS OR ADDITIONS THERETO. ADDITIONALLY, YOU POINT OUT THAT NO SPECIFIC CLAUSES, OTHER THAN THE STANDARD GENERAL PROVISION CLAUSES, WERE REFERRED TO IN THE BID RETURNED BY FEDERAL ELECTRIC NOR WERE SUCH OTHER CLAUSES INCORPORATED BY REFERENCE ANYWHERE IN THE INVITATION SCHEDULE.

FEDERAL ELECTRIC'S BID CONSISTED OF THE COVER PAGE OF STANDARD FORM 30 (INVITATION AND BID) AND PAGES 1 THROUGH 39 OF THE SCHEDULE, BUT WITHOUT THE SUCCEEDING PAGES OF THE INVITATION WHICH INCLUDED THE STANDARD GENERAL PROVISIONS, ALTERATIONS THERETO, AND OTHER CLAUSES PRESCRIBED BY THE ARMED SERVICES PROCUREMENT REGULATION. THERE IS NO DOUBT THAT FEDERAL ELECTRIC, BY RETURNING PAGE 39 OF THE INVITATION, WHICH PROVIDED THAT "CLAUSES 1 THROUGH 69 ATTACHED HERETO AND MADE A PART HEREOF ARE THE GENERAL PROVISIONS OF THIS INVITATION FOR BIDS AND ANY RESULTANT CONTRACT," INTENDED TO BE RESPONSIVE TO AND BOUND BY THOSE GENERAL PROVISIONS. IT IS ALSO CLEAR THAT THESE GENERAL PROVISIONS AND "OTHER CONTRACT PROVISIONS" WERE INCORPORATED BY REFERENCE BY THE ABOVE-QUOTED LANGUAGE ON THE COVER PAGE OF THE INVITATION. THE FACT THAT SOME OF THESE CLAUSES ARE UNNUMBERED AND DESIGNATED ONLY BY TITLE, OR THAT THEY ARE NOT THE USUAL, STANDARD GENERAL PROVISIONS CLAUSES IS NOT, IN OUR OPINION, GERMANE TO THE QUESTION WHETHER FEDERAL ELECTRIC WOULD BE BOUND TO PERFORM IN ACCORDANCE WITH THE INVITATION AS ISSUED.

THE GENERAL PROVISIONS OF THE INVITATION WERE CLAUSES 1 THROUGH 69. THESE CLAUSES, BY THE PLAIN LANGUAGE OF THE INVITATION, WERE "INCORPORATED HEREIN BY REFERENCE.' THE INVITATION SCHEDULE, FURTHERMORE, MADE REFERENCE ON PAGE 39 TO THESE GENERAL PROVISIONS WHICH ARE THE SAME PROVISIONS REFERRED TO ON THE COVER PAGE. WE FEEL, THEREFORE, THAT THERE WAS ADEQUATE INCORPORATION BY REFERENCE AND THAT FEDERAL ELECTRIC'S BID AS SUBMITTED OBLIGATED IT TO PERFORM IN ACCORDANCE WITH ALL THE PROVISIONS OF THE INVITATION INCLUDING THE GENERAL PROVISIONS INCORPORATED BY REFERENCE. IN NEWTON V. SMITH MOTORS INC., 175 A.2D 514, 516 (1961), THE FOLLOWING GENERAL RULE ON INCORPORATION BY REFERENCE WAS STATED:

"IT IS OF COURSE WELL ESTABLISHED THAT A CONTRACT MAY BE REACHED WITH REFERENCE TO ANOTHER WRITING, AND THE OTHER DOCUMENT, OR SO MUCH OF IT AS IS REFERRED TO, WILL BE INTERPRETED AS A PART OF THE MAIN INSTRUMENT. BUT THE EXTRINSIC WRITING MUST BE CONNECTED BY SPECIFIC REFERENCE OR BY SUCH MUTUAL KNOWLEDGE AND UNDERSTANDING ON THE PART OF BOTH PARTIES THAT REFERENCE BY IMPLICATION IS CLEAR. IF THE SECONDARY INSTRUMENT WAS NOT MENTIONED IN THE UNDERTAKING AND WAS FOREIGN TO THE MINDS OF THE PARTIES AT THE TIME OF THEIR UNDERTAKING, IT IS CLEARLY IRRELEVANT AS AN AID TO INTERPRETATION. NYE V. LOVITT, 92 VA. 710, 715, 24 S.E. 345; HIGHLAND INV. CO. V. KIRK CO., 96 IND. APP. 5, 184 N.E. 308, 309; LEE V. ROBERT MITCHELL MFG. CO., 45 OHIO APP. 502, 187 N.E. 371, 372; WILLISTON, CONTRACTS, SEC. 628 (REV. ED 1936) P. 1801 ET SEQ.; 12 AM.JUR. CONTRACTS 246, P. 781.'

PARTICULARLY PERTINENT HERE IS THE DECISION OF THE SUPREME COURT OF ERRORS OF CONNECTICUT IN THE BATTER BUILDING MATERIALS COMPANY V. KIRSCHNER, ET AL., 110 A.2D 464, 467-468 (1954):

"THE SITUATION WAS THIS: A COPY OF THE SPECIFICATIONS PREPARED BY GITLITZ HAD BEEN GIVEN TO THE PLAINTIFFS TO AID THEM IN ESTIMATING THE COST OF THE JOB. THE WRITTEN CONTRACT EXECUTED BY THE PLAINTIFFS ON SEPTEMBER 6, 1952, RECITES THAT "ALL OF THE WORK CONTEMPLATED WITHIN THE TERMS OF THE AGREEMENT IS MORE FULLY SET FORTH AND DESCRIBED IN CERTAIN PLANS AND SPECIFICATIONS DRAWN BY ONE, SAMUEL GITLITZ, AN ARCHITECT.' THE SPECIFICATIONS WHICH THUS BECAME A PART OF THE CONTRACT PROVIDE THAT "THE GENERAL CONDITIONS AS CONTAINED IN PAGES 1 10 INCLUSIVE, FORM A2, AS ISSUED BY THE AMERICAN INSTITUTE OF ARCHITECTS, SHALL GOVERN IN ALL CASES, EXCEPT WHERE THEY CONFLICT WITH THE SPECIAL CONDITIONS.' THE COURT WAS WARRANTED IN FINDING THAT ARTICLES 39 AND 40 OF THE AMERICAN INSTITUTE OF ARCHITECTS FORM A2 (SEPT. 1, 1951), PRINTED ON PAGES 9 AND 10 THEREOF, WERE INCLUDED WITHIN THE AGREEMENT OF THE PARTIES.

"ALTHOUGH THE PLAINTIFFS ARGUE TO THE CONTRARY, IT IS OF NO AVAIL TO THEM THAT THE PROVISIONS FOR THE ARBITRATION CONTEMPLATED BY ARTICLES 39 AND 40 ARE FOUND IN A WRITING REFERRED TO IN THE SPECIFICATIONS, WHICH IN TURN ARE INCORPORATED BY REFERENCE INTO THE WRITTEN CONTRACT OF SEPTEMBER 6. WHERE, AS HERE, THE SIGNATORIES EXECUTE A CONTRACT WHICH REFERS TO ANOTHER INSTRUMENT IN SUCH A MANNER AS TO ESTABLISH THAT THEY INTENDED TO MAKE THE TERMS AND CONDITIONS OF THAT OTHER INSTRUMENT A PART OF THEIR UNDERSTANDING, THE TWO MAYBE INTERPRETED TOGETHER AS THE AGREEMENT OF THE PARTIES. SEE BOSTON LUMBER CO. V. PENDLETON BROS., INC., 102 CONN. 626, 631, 129 A. 782; 1 CORBIN, CONTRACTS, P. 97; 12 AM.JUR. 781, SECS. 245. THE INCORPORATION BY REFERENCE OF THE PROVISIONS IN FORM A2 DISTINGUISHES THE PRESENT CASE FROM THE FACTS IN SAMSON V. BERGIN, 138 CONN. 306, 310, 84 A.2D 273. NOR IS A PARTY ALLOWED, IN THE ABSENCE OF ACCIDENT, FRAUD, MISTAKE OR UNFAIR DEALING, TO ESCAPE HIS CONTRACTUAL OBLIGATIONS BY SAYING, AS EACH OF THE PLAINTIFFS DOES HERE, THAT HE DID NOT READ WHAT WAS EXPRESSLY INCORPORATED AS SPECIFIC PROVISIONS OF THE CONTRACT INTO WHICH HE ENTERED. SEE DININI V. MECHANICS' SAVINGS BANK, 85 CONN. 225, 228, 82 A. 580; WEST V. SUDA, 69 CONN. 60, 62, 36 A. 1015.'

SEE, ALSO, 17 AM. JUR. 2D, CONTRACTS, SECTION 263.

THERE IS ALSO FOR CONSIDERATION THE FACT THAT MANY OF THE CLAUSES REFERRED TO IN PART XXI (PAGE 39) OF THE INVITATION ARE MANDATORY CLAUSES PRESCRIBED BY THE ARMED SERVICES PROCUREMENT REGULATION (ASPR) FOR USE IN CONTRACTS SUCH AS INVOLVED HERE; I.E., EQUAL OPPORTUNITY CLAUSE (ASPR 12- 802); NOTICE AND ASSISTANCE REGARDING PATENT AND COPYRIGHT INFRINGEMENT (ASPR 9-104); GOVERNMENT-FURNISHED PROPERTY (ASPR 13-702); SMALL BUSINESS SUBCONTRACTING PROGRAM (ASPR 1-707.3 (B) ); AUDIT-PRICE ADJUSTMENT (ASPR 7 -104.41); SOVIET-CONTROLLED AREAS (ASPR 6-403); PRICE REDUCTION FOR DEFECTIVE COST OR PRICING DATA-PRICE ADJUSTMENTS (ASPR 7-104.29), ETC. IT HAS BEEN JUDICIALLY DETERMINED THAT WHERE THE ASPR REQUIRES THAT A CONTRACT CONTAIN CERTAIN PROVISIONS, THE CONTRACT WILL BE READ AS IF IT CONTAINED THOSE PROVISIONS EVEN THOUGH IT MAY NOT PHYSICALLY CONTAIN THEM. SEE G. L. CHRISTIAN AND ASSOCIATES V. UNITED STATES, 160 CT.CL. 1; ID. 58.

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