B-155691, FEB. 26, 1965

B-155691, FEB. 26, 1965

TO THE HONORABLE SECRETARY OF THE NAVY:

WE HAVE RECEIVED A REPORT FROM THE BUREAU OF SUPPLIES AND ACCOUNTS, DATED JANUARY 19, 1965, CONCERNING THE PROTEST OF HUYCK SYSTEMS COMPANY AGAINST A PROPOSED AWARD BY THE NAVY PURCHASING OFFICE, WASHINGTON, D.C., OF A CONTRACT FOR THIRTY-SIX COMPUTER DISPLAY SETS, AND RELATED MATERIAL, PURSUANT TO INVITATION FOR BIDS NO. IFB 600-1133 64, TO LORAL ELECTRONIC SYSTEMS.

THE SUBJECT INVITATION SOLICITED BIDS ON THE BASIS OF DELIVERY F.O.B. ORIGIN, AND PROVIDED THAT THE BIDS WOULD BE EVALUATED "ON THE BASIS OF THE LOWEST OVERALL COST TO THE GOVERNMENT, TAKING ACCOUNT OF TRANSPORTATION COSTS" FROM THE POINT OF ORIGIN TO GRUMMAN AIRCRAFT CORPORATION, BETHPAGE, LONG ISLAND, NEW YORK, THE DESTINATION SPECIFIED IN THE INVITATION FOR PURPOSES OF BID EVALUATION ONLY. THE INVITATION ALSO CONTAINED THE FOLLOWING CLAUSE:

"GUARANTEED MAXIMUM SHIPPING WEIGHTS, DIMENSIONS AND RELATED DATA

"/A) WHEN DESTINATIONS OR EVALUATION POINTS ARE NAMED EACH BID/PROPOSAL WILL BE EVALUATED TO THE DESTINATIONS SPECIFIED BY ADDING TO THE FOB ORIGIN PRICE ALL TRANSPORTATION CHARGES AT THE RATE OF DELIVERY SPECIFIED TO SAID DESTINATIONS.

"/B) THE ATTACHED "EVALUATION TRANSPORTATION DATA SHEET" (PRNC-NPO 238) ( 6/63 ( WILL BE COMPLETED FOR ITEMS CHECKED IN ORDER TO PERMIT THE DETERMINATION OF TRANSPORTATION COSTS.

"/C) THE CONTRACT RESULTING FROM THIS SOLICITATION WILL PROVIDE THAT, IF DELIVERED ITEMS ARE FURNISHED IN A STATE OTHER THAN AS SPECIFIED BY THE BIDDER/OFFEROR IN THE "EVALUATION TRANSPORTATION DATA SHEET" (PRNC-NPO- 238) ( 6/63 ( AND THIS RESULTS IN A GREATER TRANSPORTATION COST TO THE GOVERNMENT, THE CONTRACT PRICE SHALL BE REDUCED BY AN AMOUNT EQUAL TO THE DIFFERENCE BETWEEN THE TRANSPORTATION COSTS COMPUTED FOR EVALUATION PURPOSES BASED ON THE BIDDER-S/OFFEROR'S GUARANTEED TRANSPORTATION DATA AND THE TRANSPORTATION COSTS THAT SHOULD HAVE BEEN USED FOR EVALUATION PURPOSES, BASED ON CORRECT TRANSPORTATION DATA.'

THE "EVALUATION TRANSPORTATION DATA SHEET," REFERRED TO IN THE ABOVE QUOTED CLAUSE, CONTAINED THE FOLLOWING PROVISION: "FAILURE TO FURNISH THIS DATA IN THE BID WILL RESULT IN REJECTION OF THE BID.'

LORAL SUBMITTED A BID WHICH, EXCLUSIVE OF TRANSPORTATION COST, WAS MORE THAN $22,000 LOWER THAN THE SECOND LOW BID, BUT IT FAILED TO INCLUDE SPECIFIC WEIGHTS OR DIMENSIONS OF LOADED SHIPPING CONTAINERS AS SPECIFIED IN THE "EVALUATION TRANSPORTATION DATA SHEET," INSERTING IN THE LINE PROVIDED THEREFOR THE WORK "VARIOUS.' IN THIS SHEET LORAL ALSO SPECIFIED THAT PIECES WOULD BE PACKAGED AND PACKED IN A QUANTITY OF ONE PER CONTAINER, SET UP FOR DOMESTIC SHIPMENT IN FIBERBOARD CONTAINERS WITHOUT NEED FOR SPECIAL HANDLING. SINCE THE INVITATION CALLED FOR 72 UNITS OF ITEM 3 AND 36 UNITS EACH OF THE OTHER 5, THE MAXIMUM NUMBER OF EXTERIOR CONTAINERS WAS THUS FIXED AT 252. THE INVITATION FURTHER PROVIDED THAT PRESERVATION, PACKAGING AND PACKING WOULD BE IN ACCORDANCE WITH MILITARY SPECIFICATION MIL-E-17555E, WHICH INCORPORATED THE CURRENT ISSUE OF FEDERAL SPECIFICATION PPP-B-636B COVERING FIBERBOARD BOXES. THE CURRENT ISSUE OF THE LATTER SPECIFICATION LIMITS THE WEIGHT OF A FIBERBOARD BOX AND CONTENTS TO A MAXIMUM OF 100 POUNDS, AND THE INSIDE DIMENSIONS OF THE BOX TO A MAXIMUM OF 100 INCHES (SUM OF LENGTH, WIDTH AND DEPTH).

FROM THE FOREGOING, IT SEEMS CLEAR THAT THE MAXIMUM WEIGHT WHICH COULD POSSIBLY BE INVOLVED FOR TRANSPORTATION OF THE ITEMS OFFERED BY THE LORAL BID WOULD BE 27,720 POUNDS. BY COMPUTING TRANSPORTATION COSTS FOR THAT WEIGHT FROM THE PLANT OF THE LOW BIDDER, LORAL, AND FOR THE GUARANTEED WEIGHTS SHOWN IN THE SECOND AND THIRD LOW BIDS OF TRANSDYNE CORPORATION AND HUYCK SYSTEMS COMPANY FOR SHIPMENT FROM THEIR RESPECTIVE PLANTS, THE TRANSPORTATION OFFICER ARRIVED AT THE FOLLOWING MAXIMUM TRANSPORTATION COSTS:

TABLE

BIDDER DISTANCE COST

LORAL FROM BRONX, NEW YORK $227.30

TO BETHPAGE, LONG ISLAND,

NEW YORK

TRANSDYNE FROM NEWPORT NEWS, VIRGINIA 147.75

TO BETHPAGE, LONG ISLAND

HUYCK FROM HUNTINGTON, LONG ISLAND 144.00

TO BETHPAGE, LONG ISLAND

THE EVALUATED TOTAL BID PRICES, INCLUDING TRANSPORTATION COST AS COMPUTED ABOVE, WERE AS FOLLOWS:

TABLE

LORAL ELECTRONIC SYSTEMS$1,143,344.58

TRANSDYNE CORPORATION 1,165,323.51

HUYCK SYSTEMS 1,198,450.00

HUYCK CONTENDS LORAL'S BID SHOULD BE REJECTED BECAUSE IT FAILED TO INCLUDE DATA SPECIFICALLY REQUIRED BY THE INVITATION. LORAL CONTENDS THAT THE REQUIREMENT FOR GUARANTEED WEIGHTS WAS AMBIGUOUSLY EXPRESSED, AND IN ANY EVENT, SINCE ITS BID REMAINS LOW EVEN AFTER THE MAXIMUM TRANSPORTATION COST HAS BEEN ADDED, THE REQUIREMENT SHOULD BE CONSIDERED IMMATERIAL, AND THEREFORE SHOULD BE WAIVED. THE CONTRACTING OFFICER PROPOSES TO REJECT THE LORAL BID AS NONRESPONSIVE TO THE TERMS OF THE INVITATION, AND TO AWARD THE CONTRACT TO TRANSDYNE, THE SECOND LOW BIDDER. THE ASSISTANT CHIEF FOR PURCHASING, BUREAU OF SUPPLIES AND ACCOUNTS, RECOMMENDS THAT THE LORAL BID BE CONSIDERED FOR AWARD, SINCE, IN HIS VIEW, SUCH CONSIDERATION WOULD NOT BE PREJUDICIAL TO THE RIGHTS OF OTHER BIDDERS AND WOULD NOT ADVERSELY AFFECT THE INTEGRITY OF THE FORMAL ADVERTISING SYSTEM.

THE QUESTION AT ISSUE IS WHETHER A BIDDER'S FAILURE TO PROVIDE EVERY ITEM OF INFORMATION REQUIRED BY A GUARANTEED SHIPPING WEIGHT PROVISION IN AN INVITATION MUST ALWAYS RESULT IN THE REJECTION OF HIS BID, EVEN WHERE, AS HERE, SUFFICIENT INFORMATION IS GIVEN FOR DETERMINATION OF A MAXIMUM SHIPPING WEIGHT AND THE EVALUATION OF BIDS CONCLUSIVELY SHOWS THAT HIS BID WOULD STILL BE VERY SUBSTANTIALLY LOWER THAN ANY OTHER, AFTER ADDING TO IT THE MAXIMUM POSSIBLE TRANSPORTATION COST. IN CONSIDERING THIS QUESTION, WE MUST KEEP IN MIND OUR DECISION TO THE EFFECT THAT NO LAW OR REGULATION PREVENTS A BIDDER EITHER FROM UNDERSTATING A GUARANTEED WEIGHT, AND THEREBY CONSTRUCTIVELY REDUCING HIS BID PRICE FOR SPECIFIED ARTICLES, OR BY IMPLICATION FROM THOSE DECISIONS, FROM GUARANTEEING AN OVERSTATED WEIGHT, WHETHER BECAUSE OF MISTAKE OR IN ORDER TO PRECLUDE THE POSSIBILITY OF ANY CHARGE FOR EXCESS TRANSPORTATION COSTS. SEE B-154291, DATED AUGUST 22, 1964.

SECTION 2305 OF 10 U.S.C. PROVIDES THAT AWARDS SHALL BE MADE TO THE RESPONSIBLE BIDDER WHOSE BID CONFORMS TO THE INVITATION AND REPRESENTS THE LOWEST OVERALL ASCERTAINABLE COST TO THE GOVERNMENT. SEE B-150735, DATED MARCH 6, 1963. IT IS SETTLED THAT IN PERMITTING AWARDS ONLY TO LOW BIDDERS WHOSE BIDS HAVE CONFORMED WITH THE INVITATION, CONGRESS INTENDED TO ESTABLISH A PROCUREMENT SYSTEM WHICH WOULD GUARANTEE TO BIDDERS AN EQUAL OPPORTUNITY TO COMPETE ON A COMMON BASIS. IT DID NOT INTEND TO CONFER ON ANY BIDDER THE RIGHT TO INSIST ON ENFORCEMENT OF INVITATION PROVISIONS THE WAIVER OF WHICH WOULD NOT RESULT IN AN UNFAIR COMPETITIVE ADVANTAGE TO ANOTHER BIDDER BY PERMITTING A METHOD OF CONTRACT PERFORMANCE DIFFERENT FROM THAT CONTEMPLATED BY THE INVITATION, OR BY PERMITTING THE BID PRICE TO BE EVALUATED UPON A BASIS NOT COMMON TO ALL BIDS. 40 COMP. GEN. 321, 324; SEE ALSO B 154610, 44 COMP. GEN.

- , DATED SEPTEMBER 11, 1964, AND CASES CITED THEREIN HOLDING BIDS TO BE RESPONSIVE TO THE MATERIAL PROVISIONS OF THE IFB NOTWITHSTANDING THEIR FAILURE TO CONFORM TO PROVISIONS WHICH UNNECESSARILY REQUIRED CERTAIN TRANSPORTATION INFORMATION. IN VIEW OF THIS CONGRESSIONAL INTENT, WE HAVE CONSISTENTLY HELD THAT WHETHER A PROCURING ACTIVITY MAY WAIVE A BIDDER'S TECHNICAL NONCOMPLIANCE WITH A PROVISION IN AN INVITATION DEPENDS UPON WHETHER THE DEVIATION GOES TO THE SUBSTANCE OF THE BID SO AS TO AFFECT EITHER THE PRICE, QUANTITY OR QUALITY OF THE ARTICLES OFFERED, OR IS MERELY A MATTER OF FORM OR SOME IMMATERIAL VARIATION FROM THE EXACT REQUIREMENTS OF THE SPECIFICATIONS SUCH AS WOULD NOT AFFECT EITHER THE PRICE, QUALITY, OR QUANTITY OF THE ARTICLES OFFERED. 30 COMP. GEN. 179.

CONSIDERING THE PERTINENT LANGUAGE OF THE INVITATION, AND THE CLEAR PURPOSE AND INTENT THEREOF, WE DO NOT BELIEVE THAT THE LORAL BID WAS SO DEFICIENT AS TO RENDER IT NONRESPONSIVE OR TO PREVENT A VALID AWARD OF A CONTRACT THEREON, NOR DO WE BELIEVE THAT SUCH AN AWARD WOULD BE IN DEROGATION OF ANY RIGHTS OF OTHER BIDDERS OR DETRIMENTAL TO THE COMPETITIVE BIDDING SYSTEM.

THE PURPOSE OF THE "EVALUATION TRANSPORTATION DATA SHEET" WAS TO ELICIT INFORMATION NECESSARY FOR APPLICATION OF THE "GUARANTEED MAXIMUM SHIPPING WEIGHTS, DIMENSIONS AND RELATED DATA" CLAUSE QUOTED ABOVE, AND PARAGRAPH (A) OF THAT CLAUSE PROVIDED FOR EVALUATION OF EACH BID BY ADDING TO THE ORIGIN BID PRICE ALL TRANSPORTATION CHARGES. AS INDICATED ABOVE, THE INFORMATION FURNISHED BY LORAL WAS SUFFICIENT TO PERMIT COMPUTATION OF A MAXIMUM TRANSPORTATION CHARGE, AS PRECISELY AS IF LORAL HAD SPECIFICALLY STATED ITS SHIPPING WEIGHTS AS "110 POUNDS FOR EACH UNIT OF ITEMS 1 THROUGH 6.'

PARAGRAPH (C) OF THE CLAUSE PROVIDED THAT THE CONTRACT WOULD PROVIDE THAT THE PRICE WOULD BE REDUCED "IF DELIVERED ITEMS ARE FURNISHED IN A STATE OTHER THAN AS SPECIFIED BY THE BIDDER/OFFEROR IN THE "EVALUATION TRANSPORTATION DATA SHEET" ... AND THIS RESULTS IN A GREATER TRANSPORTATION COST TO THE GOVERNMENT.' HERE AGAIN WE FIND NO INADEQUACY IN THE INFORMATION FURNISHED TO PREVENT FULL APPLICATION AND ENFORCEMENT OF THIS CLAUSE. IF LORAL SHOULD DELIVER THE ARTICLES IN ANY ,STATE" OTHER THAN ONE UNIT EACH IN A FIBERBOARD CONTAINER MEETING THE SPECIFICATIONS REFERENCED IN THE INVITATION--- NAMELY, NOT WEIGHING IN EXCESS OF 110 POUNDS FOR CONTAINER AND CONTENTS, AND NOT EXCEEDING 100 INCHES COMBINED LENGTH, WIDTH AND DEPTH--- AND TRANSPORTATION COSTS WERE THEREBY INCREASED OVER THE AMOUNT INCLUDED IN THE EVALUATION, BOTH THE LIABILITY OF LORAL FOR SUCH INCREASED COSTS AND THE PRECISE AMOUNT THEREOF WOULD BE CLEARLY FIXED BY THE CONTRACT.

IN THE CIRCUMSTANCES WE MUST CONCLUDE THAT THE LORAL BID SHOULD BE CONSIDERED FULLY RESPONSIVE TO ALL MATERIAL REQUIREMENTS OF THE INVITATION.

THE ATTACHMENT TO THE STATEMENT OF FACTS IN THE ADMINISTRATIVE REPORT IS RETURNED HEREWITH AS REQUESTED.