B-139516, SEP. 21, 1959

B-139516, SEP. 21, 1959

TO MR. GEORGE J. GOLDSBOROUGH, JR.:

WE HAVE REVIEWED YOUR BRIEF SUBMITTED IN CONNECTION WITH THE PROTEST BY VAUGHN CONSTRUCTION CORPORATION AGAINST THE REJECTION OF ITS BID UNDER INVITATION NO. ENG-30-347-59-18, ISSUED BY THE CORPS OF ENGINEERS. THAT PROTEST BY VAUGHN CONSTRUCTION CORPORATION WAS THE SUBJECT OF OUR DECISION OF JULY 1, 1959, B-139516.

IN GENERAL YOUR POSITION IS THAT VAUGHN CONSTRUCTION CORPORATION WAS, AND STILL IS, ENTITLED TO THE AWARD. AS STATED IN OUR DECISION OF JULY 1, 1959, THERE IS A SERIOUS QUESTION AS TO THE PROPRIETY OF THE REJECTION OF VAUGHN'S BID AND WE BELIEVE THAT THE ADMINISTRATIVE ACTION TAKEN IN THE CASE WAS BASED ON RATHER TENUOUS EVIDENCE. HOWEVER, THE AWARD TO ARGO CONSTRUCTION LTD. WAS NOT DISTURBED IN VIEW OF THE COMMITMENTS MADE BY THAT COMPANY AND THE REPORTED URGENT NEED FOR AN EARLY COMPLETION.

IN ANY CASE BEFORE THIS OFFICE IN WHICH IT HAS BEEN DETERMINED THAT THE PROTEST IS VALID, WE ARE CONFRONTED WITH THE QUESTION AS TO THE ACTION TO BE TAKEN, HAVING REGARD FOR THE INTERESTS OF THE GOVERNMENT AS WELL AS THE INTERESTS OF THE PROTESTING BIDDER. ONE OF THE FACTORS TO BE CONSIDERED IS THE LINE OF COURT DECISIONS WHICH DECLARE THAT STATUTES REGULATING THE CONTRACT PROCEDURES OF OFFICERS OF THE GOVERNMENT WERE ENACTED SOLELY FOR THE BENEFIT OF THE GOVERNMENT AND CONFER NO ENFORCEABLE RIGHTS UPON BIDDERS. WHENEVER OUR DECISION CAN BE MADE PRIOR TO AWARD, WE WILL INSTRUCT THE CONTRACTING AGENCY AS TO THE CORRECT ACTION TO BE TAKEN DEPENDING UPON THE CIRCUMSTANCES IN THE PARTICULAR CASE. HOWEVER, IF, FOR ANY REASON, WE ARE UNABLE TO REACH A DECISION UNTIL AFTER THE CONTRACT HAS BEEN IMPROPERLY AWARDED THE PROBLEM IS CONSIDERABLY MORE DIFFICULT. THOSE CASES WE SOMETIMES WILL DIRECT THE CONTRACTING AGENCY TO TERMINATE THE CONTRACT IF WE HAVE NO DOUBT THAT SUCH ACTION WOULD BE LEGALLY AND FACTUALLY SUPPORTABLE, IF THE CONTRACTOR HAS NOT SUBSTANTIALLY COMPLETED PERFORMANCE AND IF THERE ARE NO OTHER FACTORS, SUCH AS URGENT TIME REQUIREMENTS, PRESENT TO INTERFERE WITH CANCELLATION. ON THE OTHER HAND WHEN THESE FACTORS ARE PRESENT AND WHEN THERE IS NOTHING TO INDICATE THAT THE AWARD WAS NOT MADE IN GOOD FAITH, IT IS GENERALLY IN THE BEST INTERESTS OF THE GOVERNMENT NOT TO REQUIRE CANCELLATION.

WE REALIZE THAT AN UNSUCCESSFUL BIDDER SOMETIMES DERIVES NO MATERIAL BENEFIT FROM A SUCCESSFUL PROTEST. HOWEVER, EVEN IN THOSE CASES WE BRING THE IMPROPER ACTION OR PROCEDURES INVOLVED TO THE ATTENTION OF THE HEAD OF THE CONTRACTING AGENCY IN ORDER THAT RECURRENCES MAY BE AVOIDED. CONSEQUENTLY, WHILE THE BID PROTEST PROCEDURE MAY NOT AFFORD AN ADEQUATE REMEDY IN EVERY CASE WE FEEL THAT THE AVAILABILITY OF THE PROCEDURE IN THIS OFFICE SERVES A SALUTARY PURPOSE IN HELPING TO MAINTAIN PROPER CONTRACTING PROCEDURES ON A GOVERNMENT-WIDE BASIS AND PUBLIC CONFIDENCE IN THE COMPETITIVE BIDDING SYSTEM.

AS STATED ABOVE THE AWARD TO ARGO CONSTRUCTION LTD. WAS NOT DISTURBED BECAUSE OF THE TIME FACTOR AND THE COMMITMENTS MADE. COMPLETION OF THE PROJECT IS AS URGENT TODAY AS IT WAS ON JULY 1, 1959, THE DATE OF OUR DECISION. MOREOVER, AS OF AUGUST 4, 1959, THE ARMY ENGINEERS REPORTED THAT THE PROJECT WAS 12 PERCENT COMPLETED. IN THE CIRCUMSTANCES IT IS STILL IN THE BEST INTEREST OF THE GOVERNMENT NOT TO REQUIRE CANCELLATION OF THE CONTRACT WITH ARGO CONSTRUCTION LTD.

IN A LETTER DATED JULY 17, 1959, WE ADVISED MR. JOSEPH HALPERN, PRESIDENT OF VAUGHN CONSTRUCTION CORPORATION, THAT AN INVESTIGATION HAD BEEN INITIATED. YOU WILL BE ADVISED OF THE RESULTS OF THAT INVESTIGATION UPON ITS COMPLETION.