B-163744, MAR. 21, 1968

B-163744: Mar 21, 1968

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BECAUSE YOU HAVE PROTESTED AGAINST THE PROPOSED AWARD TO INDUSTRIAL IN YOUR LETTER OF MARCH 11. WE ARE CONSIDERING THIS MATTER AS THE ENTRY OF A PROTEST BEFORE THIS OFFICE BY PHOENIX. OVER THE NEXT FEW MONTHS FOUR NOTICES WERE ISSUED CHANGING THE BID OPENING DATE. DURING THIS PERIOD THREE AMENDMENTS WERE ALSO ISSUED. BIDDERS WERE ADVISED THAT BECAUSE ALL BID PRICES WERE IN EXCESS OF THE FUNDS AVAILABLE FOR THE PROJECT IT WAS NECESSARY TO REJECT ALL BIDS. THAT REVISED BIDS WERE DUE BY FEBRUARY 14. INCLUDED WITH THIS AMENDMENT WAS A NEW FORM FOR THE SUBMISSION OF REVISED BIDS. 890 WAS NOW LOW ON ITEM NO. 1. 900 FOR THE SAME ITEM WAS SECOND LOW. REVISED BID IS NOT RESPONSIVE TO THE TERMS OF THE INVITATION IN THAT IT DOES NOT ACKNOWLEDGE AMENDMENT NO. 1.

B-163744, MAR. 21, 1968

TO LEWIS, MITCHELL AND BIXLER:

THE NAVAL FACILITIES ENGINEERING COMMAND, DEPARTMENT OF THE NAVY, BY ITS LETTER DATED MARCH 6, 1968, CODE 0211B/FRF:LAC, REQUESTED OUR OPINION WHETHER THE FAILURE OF INDUSTRIAL ENGINEERING COMPANY, INCORPORATED (INDUSTRIAL), TO ACKNOWLEDGE AN AMENDMENT ON THE SECOND OPENING OF BIDS UNDER INVITATION FOR BIDS NO. N62477-68-B-0039, ISSUED AUGUST 23, 1967, BY THE CHESAPEAKE DIVISION, NAVAL FACILITIES ENGINEERING COMMAND, WASHINGTON NAVY YARD, WASHINGTON, D.C., FOR THE CONSTRUCTION OF A LABORATORY AND TECHNICAL SUPPORT BUILDING AT THE NATIONAL NAVAL MEDICAL CENTER, BETHESDA, MARYLAND, RENDERED SAID BID NONRESPONSIVE. BECAUSE YOU HAVE PROTESTED AGAINST THE PROPOSED AWARD TO INDUSTRIAL IN YOUR LETTER OF MARCH 11, 1968, TO THIS OFFICE AND YOUR LETTER OF FEBRUARY 21, 1968, TO THE NAVY DEPARTMENT, WE ARE CONSIDERING THIS MATTER AS THE ENTRY OF A PROTEST BEFORE THIS OFFICE BY PHOENIX.

THE SUBJECT INVITATION, AS ISSUED AUGUST 23, 1967, CONTAINED AN "INVITATION FOR BIDS" (CONSTRUCTION CONTRACT) STANDARD FORM 20 OF JANUARY 1961, AND A "BID FORM" (CONSTRUCTION CONTRACT) STANDARD FORM 21 OF DECEMBER 1965, TOGETHER WITH OTHER MATERIAL.

OVER THE NEXT FEW MONTHS FOUR NOTICES WERE ISSUED CHANGING THE BID OPENING DATE, THE LAST ONE SETTING DECEMBER 20, 1967, AS THE OPENING DATE.

DURING THIS PERIOD THREE AMENDMENTS WERE ALSO ISSUED, THE FIRST ONE, AMENDMENT NO. 1 OF NOVEMBER 9, 1967, MODIFYING THE SPECIFICATIONS FOR THE LABORATORY EQUIPMENT, THE ELEVATOR SYSTEM, AND THE PLUMBING AND HEATING SYSTEMS. AMENDMENTS NOS. 2 AND 3 CHANGED THE MINIMUM WAGE RATES AND PROHIBITED BLASTING DURING CONSTRUCTION, RESPECTIVELY.

TEN FIRMS RESPONDED BY THE EXTENDED BID OPENING DATE, DECEMBER 20, 1967, WITH THE BID OF THE PROTESTING FIRM, PHOENIX, OF $1,749,000, LOW ON ITEM NO. 1, AND THAT OF THE SUBSEQUENTLY LOW BIDDER, INDUSTRIAL, OF $1,867,000, FOURTH LOW.

BY LETTER OF JANUARY 11, 1968, BIDDERS WERE ADVISED THAT BECAUSE ALL BID PRICES WERE IN EXCESS OF THE FUNDS AVAILABLE FOR THE PROJECT IT WAS NECESSARY TO REJECT ALL BIDS, AND THAT A NEW INVITATION WOULD BE ISSUED AS SOON AS THE SPECIFICATIONS COULD BE REVISED.

NOTICE NO. 5, DATED JANUARY 12, 1968, INFORMED INTERESTED BIDDERS THAT THE PROJECT WOULD BE REVISED BY AMENDMENT NO. 4, AND THAT REVISED BIDS WERE DUE BY FEBRUARY 14, 1968.

AMENDMENT NO. 4 ISSUED JANUARY 15, 1968, CANCELED AMENDMENTS NOS.2 AND 3, REVISED THE SPECIFICATION TO PERMIT BLASTING, AND MADE CERTAIN OTHER CHANGES. INCLUDED WITH THIS AMENDMENT WAS A NEW FORM FOR THE SUBMISSION OF REVISED BIDS.

AMENDMENT NO. 5 AGAIN MODIFIED THE MINIMUM WAGE RATE REQUIREMENTS.

SEVEN FIRMS SUBMITTED REVISED BIDS BY THE SECOND BID OPENING DATE,FEBRUARY 14, 1968. INDUSTRIAL'S BID OF $1,587,890 WAS NOW LOW ON ITEM NO. 1, WHILE PHOENIX'S BID OF $1,593,900 FOR THE SAME ITEM WAS SECOND LOW.

INDUSTRIAL ACKNOWLEDGED RECEIPT OF AMENDMENTS NOS. 4 AND 5 IN THE APPROPRIATE SPACES ON THE BID FORM SUBMITTED FOR THE SECOND OPENING, BUT IT MADE NO MENTION OF AMENDMENTS NOS. 1, 2, AND 3. HOWEVER, INDUSTRIAL'S BID SUBMITTED FOR THE EARLIER, DECEMBER 20, 1967, BID OPENING, DID ACKNOWLEDGE RECEIPT OF AMENDMENTS NOS. 1, 2, AND 3 IN THE APPROPRIATE SPACE.

PHOENIX CONTENDS THAT INDUSTRIAL'S SECOND, REVISED BID IS NOT RESPONSIVE TO THE TERMS OF THE INVITATION IN THAT IT DOES NOT ACKNOWLEDGE AMENDMENT NO. 1. SINCE THAT AMENDMENT MADE SUBSTANTIAL CHANGES IN THE SPECIFICATIONS, AND SINCE IT HAD NOT BEEN CANCELED OR SUPERSEDED BY A LATER AMENDMENT, IT IS SUGGESTED THAT THE FAILURE OF INDUSTRIAL TO EXPRESSLY ACKNOWLEDGE RECEIPT OF SAID AMENDMENT ON ITS REVISED BID FORM RENDERED INDUSTRIAL'S BID NONRESPONSIVE. IN ITS LETTER OF FEBRUARY 21, 1968, TO THE NAVY, COUNSEL FOR PHOENIX CONTENDS:

"AS THE MATTER NOW STANDS, INDUSTRIAL, IF AWARDED THE CONTRACT WITHOUT REFORMATION OR MODIFICATION, WOULD CLEARLY BE WITHIN ITS RIGHTS TO PERFORM WITHOUT COMPLIANCE WITH AMENDMENT 1, A MATTER CLEARLY PREJUDICIAL TO THE OTHER BIDDERS. IT MAY NOT BE ASSUMED THAT ACKNOWLEDGEMENT OF AMENDMENT 1 IN THE PRIOR BID IS ACKNOWLEDGEMENT IN THE PRESENT BID SINCE THE PRIOR BID WAS IRREVOCABLY REJECTED, NECESSITATING A NEW OFFER AND ACCEPTANCE. SUCH AN ASSUMPTION WOULD ONLY INDICATE A CONFUSED STATE IN INDUSTRIAL'S BIDDING. ANY REVERSION TO THE ORIGINAL BID SHOULD FAVOR PHOENIX, THE APPARENT LOW BIDDER AT THAT TIME. CERTAINLY, A BIDDER MAY NOT BE ALLOWED TO CLARIFY ITS INTENTION THAT AN AMENDMENT WAS INCLUDED IN ITS BID, FOR TO DO SO WOULD SERIOUSLY PREJUDICE THE OTHER BIDDERS, 41 COMP. GEN. 412.'

WE BELIEVE THE BASIC QUESTION HERE IS WHETHER INDUSTRIAL'S REVISED BID MUST BE CONSIDERED ALONE, OR WHETHER THE PRIOR ACKNOWLEDGMENT OF AMENDMENT NO. 1 OPERATES AS AN EFFECTIVE ACKNOWLEDGMENT UNDER THE CIRCUMSTANCES. THE ANSWER TO THIS QUESTION APPEARS TO LIE IN A CAREFUL EXAMINATION OF THE SOMEWHAT UNUSUAL CIRCUMSTANCES OF THIS PROCUREMENT, WHICH LEAD US TO CONCLUDE THAT THE ENTIRE SEQUENCE OF EVENTS, FROM THE FIRST ISSUANCE OF THE INVITATION IN AUGUST 23, 1967, UNTIL THE OPENING OF BIDS ON FEBRUARY 14, 1968, MUST BE CONSIDERED IN ORDER TO PROPERLY EVALUATE THE BID IN QUESTION.

TO ILLUSTRATE, THE "INVITATION FOR BIDS" (CONSTRUCTION CONTRACT) STANDARD FORM 20 OF JANUARY 1961, WITH ITS STATEMENT OF THE BASIC TERMS AND CONDITIONS OF THE CONTRACT, AND WITH ITS REFERENCE TO THE APPLICABLE SPECIFICATIONS, WAS NEVER REISSUED AFTER ITS FIRST ISSUANCE, SO THAT ALL SUBSEQUENT NOTICES, AMENDMENTS, BID FORMS, AND LETTERS, BOTH BEFORE AND AFTER THE FIRST BID OPENING, REFERRED TO THIS DOCUMENT. THEREFORE, ANY CONSIDERATION OF THE REVISED BIDS MUST ENCOMPASS THE TIME OF THE ORIGINAL BID OPENING IN ORDER TO ESTABLISH THE BASIC CONTRACT TERMS.

THE HEADING OF THE BID FORM USED FOR THE SECOND SUBMISSION OF BIDS WAS CHANGED BY THE NAVY TO READ "BID FORM REVISED.' THIS WOULD INDICATE THAT THE NAVY INTENDED TO TREAT THE NEW BIDS AS REVISIONS OF THE EXISTING BIDS, AND THAT BIDDERS WERE ADVISED OF THIS INTENTION.

FURTHER, THE AMENDMENT IN QUESTION WAS NOT REISSUED AFTER THE FIRST BID OPENING. THEREFORE, IN ORDER TO CONSIDER IT AS AMENDING THE SPECIFICATION FOR THE REVISED BIDS, THE ENTIRE COURSE OF THE PROCUREMENT MUST BE VIEWED AS RELATED ELEMENTS OF ONE CONTINUOUS SOLICITATION.

WE THEREFORE CONCLUDE THAT ALL OF THE SEGMENTS OF THIS PROCUREMENT MUST BE CONSIDERED IN ORDER TO DETERMINE THE RESPONSIVENESS OF THE REVISED BIDS SUBMITTED ON FEBRUARY 14, 1968. THIS BEING SO, WE KNOW OF NO REASON WHY THE INFORMATION CONTAINED ON THE ORIGINAL BIDS, ALONE, MUST BE EXCEPTED FROM THE REQUIREMENT OF CONSIDERING THIS PROCUREMENT AS ONE CONTINUOUS PROCESS. THIS IS TRUE REGARDLESS OF WHETHER THE GOVERNMENT LEGALLY MAY REVIVE THE ORIGINAL BID OFFERS, ONCE REJECTED, FOR WE ARE HERE CONCERNED WITH THE FACTUAL PROBLEM OF WHETHER INDUSTRIAL HAS INDICATED AN AWARENESS OF THE TERMS OF AMENDMENT NO. 1.

IN THIS REGARD, WHERE AN EXAMINATION OF THE ENTIRE RECORD AVAILABLE TO THE GOVERNMENT AT THE TIME OF BID OPENING SHOWS THAT A BIDDER HAS IN FACT RECEIVED AND CONSIDERED AN AMENDMENT, THE MERE FAILURE TO PROPERLY ACKNOWLEDGE SAID AMENDMENT IN THE USUAL FORM DOES NOT RENDER THE BID NONRESPONSIVE. 34 COMP. GEN. 581; 33 COMP. GEN. 510; B 156070, MAY 12, 1965.

WE THEREFORE CONCLUDE THAT, UNDER THE CIRCUMSTANCES OF THIS CASE, THE GOVERNMENT'S ACCEPTANCE OF INDUSTRIAL'S REVISED OFFER WITHOUT CLARIFICATION OF ANY SORT WOULD BIND THAT FIRM TO ALL OF THE TERMS OF THE INVITATION, INCLUDING AMENDMENT NO. 1. 41 COMP. GEN. 631; B 150563, FEBRUARY 28, 1963.

ANOTHER FACTOR SUPPORTING THIS CONCLUSION IS THE PROVISION IN AMENDMENT NO. 4, CANCELING AMENDMENTS NOS. 1 AND 2. FOR THIS CANCELATION TO BE MEANINGFUL, IT MUST BE UNDERSTOOD THAT AMENDMENT NO. 1 WAS STILL IN EFFECT. IT THEREFORE MAY BE ARGUED THAT INDUSTRIAL'S ACKNOWLEDGMENT OF AMENDMENT NO. 4 OPERATED AS AN ACKNOWLEDGMENT OF AMENDMENT NO. 1 UNDER THE FACTS OF THIS CASE.

FOR THE ABOVE REASONS, WE ARE CONVINCED THAT INDUSTRIAL'S REVISED BID, WHEN CONSIDERED IN THE CONTEXT OF THE ENTIRE PROCUREMENT, EFFECTIVELY ACKNOWLEDGED AMENDMENT NO. 1.

THIS BEING THE CASE, YOUR CONTENTIONS PREMISED UPON THE ASSUMPTION THAT THE AMENDMENT WAS NOT ACKNOWLEDGED, SUCH AS THOSE CONCERNING WHETHER THE AMENDMENT WAS OF SUCH A NATURE THAT THE FAILURE TO ACKNOWLEDGE IT COULD NOT BE WAIVED, NEED NOT BE CONSIDERED.

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