Skip to main content

B-152832, JAN. 20, 1964

B-152832 Jan 20, 1964
Jump To:
Skip to Highlights

Highlights

TO THE SECRETARY OF THE ARMY: WE HAVE RECEIVED A LETTER DATED DECEMBER 12. BUTLER WAS DETERMINED TO BE THE LOWEST RESPONSIVE BIDDER. BUTLER MANUFACTURING COMPANY'S BID DATED 23 JULY 1963 IS AMENDED AS FOLLOWS: NO. 1 - REFERENCE PAGE 1 OF IFB REGARDING PARAGRAPH COVERING BID ACCEPTANCE DATE. TO FURNISH ANY OR ALL OF THE ITEMS UPON WHICH PRICES ARE QUOTED. TO FURNISH ANY OR ALL OF THE ITEMS UPON WHICH PRICES ARE QUOTED * * *" DELIVERY UNDER THE CONTRACT WAS DEPENDENT UPON RECEIPT OF THE AWARDED CONTRACT. BUTLER'S OFFER WAS . ACCEPTED" AND "AWARD" WAS MADE ON OCTOBER 29. IT IS SETTLED THAT AN ACCEPTANCE MUST COMPLY WITH THE TERMS OF THE OFFER. IT IS THEREFORE CLEAR THAT THE GOVERNMENT WAS PRECLUDED BY THE TERMS OF BUTLER'S OFFER FROM ACCEPTING IT AT THE TIME IT ATTEMPTED TO.

View Decision

B-152832, JAN. 20, 1964

TO THE SECRETARY OF THE ARMY:

WE HAVE RECEIVED A LETTER DATED DECEMBER 12, 1963, FROM THE OFFICE OF THE ASSISTANT SECRETARY, REQUESTING A DECISION AS TO THE PROPRIETY OF THE ARMY'S HAVING CANCELED CONTRACT NO. DA-20-113-AMC-1894 (T) WITH BUTLER MANUFACTURING COMPANY FOR 115 SEMITRAILER TANKS.

THE RECORD ESTABLISHES THAT SOME TIME AFTER OPENING OF BIDS BY ARMY TANK AUTOMOTIVE CENTER ON AUGUST 30, 1963, BUTLER WAS DETERMINED TO BE THE LOWEST RESPONSIVE BIDDER. HOWEVER, IN A LETTER DATED AUGUST 28, 1963, BUTLER HAD MODIFIED ITS BID IN THE FOLLOWING MANNER:

"BASED ON THE FOUR AMENDMENTS RECEIVED, BUTLER MANUFACTURING COMPANY'S BID DATED 23 JULY 1963 IS AMENDED AS FOLLOWS:

NO. 1 - REFERENCE PAGE 1 OF IFB REGARDING PARAGRAPH COVERING BID ACCEPTANCE DATE, WE AMEND OUR BID AS FOLLOWS:

IN COMPLIANCE WITH THE ABOVE, THE UNDERSIGNED OFFERS AND AGREES, IF THIS BID BE ACCEPTED WITHIN A PERIOD OF NO LESS THAN 180 AND NO MORE THAN 210 CALENDAR DAYS FROM DATE OF OPENING, TO FURNISH ANY OR ALL OF THE ITEMS UPON WHICH PRICES ARE QUOTED, AT THE PRICE SET OPPOSITE EACH ITEM, DELIVERED AT THE DESIGNATED POINTS/S) WITHIN THE TIME SPECIFIED IN THE SCHEDULE.'

THE PROVISION OF THE INVITATION FOR BIDS SO MODIFIED PROVIDED:

"IN COMPLIANCE WITH THE ABOVE, THE UNDERSIGNED OFFERS AND AGREES, IF THIS BID BE ACCEPTED WITHIN 60 CALENDAR DAYS (60 CALENDAR DAYS UNLESS A DIFFERENT PERIOD BE INSERTED BY THE BIDDER) FROM THE DATE OF OPENING, TO FURNISH ANY OR ALL OF THE ITEMS UPON WHICH PRICES ARE QUOTED * * *"

DELIVERY UNDER THE CONTRACT WAS DEPENDENT UPON RECEIPT OF THE AWARDED CONTRACT.

THE PROCURING ACTIVITY MISINTERPRETED BUTLER'S MODIFICATION TO MEAN THAT BUTLER HAD MERELY EXTENDED, NOT RESTRICTED, THE PERIOD DURING WHICH ITS BID COULD BE ACCEPTED. BUTLER'S OFFER WAS ,ACCEPTED" AND "AWARD" WAS MADE ON OCTOBER 29. ON NOVEMBER 1, BUTLER CALLED TO REMIND THE PROCUREMENT PERSONNEL THAT ITS BID COULD NOT BE ACCEPTED UNTIL 180 DAYS AFTER OPENING. UPON REVIEW, THE AUTOMOTIVE CENTER AGREED. ON NOVEMBER 4, THE CENTER ADVISED BUTLER THAT THE CONTRACT" WOULD BE VOIDED ON THE GROUNDS THAT BY HAVING REFUSED TO OFFER ITS BID FOR IMMEDIATE ACCEPTANCE, BUTLER HAD RENDERED SUCH BID NONRESPONSIVE.

IT IS SETTLED THAT AN ACCEPTANCE MUST COMPLY WITH THE TERMS OF THE OFFER, INCLUDING THE LIMITATIONS ON THE TIME DURING WHICH THE OFFER MAY BE ACCEPTED. SEE 1 WILLISTON ON CONTRACTS 73, 76, 3D ED. ON THE BASIS OF THE RECORD BEFORE US, IT IS THEREFORE CLEAR THAT THE GOVERNMENT WAS PRECLUDED BY THE TERMS OF BUTLER'S OFFER FROM ACCEPTING IT AT THE TIME IT ATTEMPTED TO. ACCORDINGLY, THE GOVERNMENT'S "ACCEPTANCE" WAS NOT EFFECTIVE AND DID NOT BECOME A CONTRACT WHICH COULD BE VOIDED. NOR DOES IT APPEAR THAT THE "ACCEPTANCE" MIGHT BE CONSIDERED A COUNTEROFFER, SINCE THE CONTRACT EXTENDED BY THE GOVERNMENT INCORPORATED, WITHOUT VARIANCE, THE VERY LETTER BY WHICH BUTLER PREVENTED EFFECTIVE ACCEPTANCE BEFORE 180 DAYS AFTER BID OPENING. HOWEVER, EVEN IF THE GOVERNMENT'S "ACCEPTANCE" SHOULD BE CONSIDERED AS A COUNTEROFFER, WE THINK IT WAS EFFECTIVELY WITHDRAWN BY THE ACTIVITY'S "VOIDING" THE "CONTRACT" BEFORE BUTLER EXPRESSED A WILLINGNESS TO WAIVE ITS ACCEPTANCE RESTRICTIONS.

FURTHERMORE, WE AGREE WITH THE DEPARTMENT OF THE ARMY'S POSITION THAT A CONDITION PLACED BY A BIDDER ON THE BID ACCEPTANCE PERIOD MAY NOT SUBSEQUENTLY BE WAIVED AS IMMATERIAL UNDER PARAGRAPH 2-404.2/D) OF THE ARMED SERVICES PROCUREMENT REGULATION. SEE 39 COMP. GEN. 779, AND DECISIONS CITED THEREIN. ACCORDINGLY, SINCE THERE IS NO CONTRACT WHICH COULD HAVE BEEN CANCELED, BUT ONLY AN OUTSTANDING OFFER BY THE BIDDER, THE TERMS OF WHICH CANNOT NOW BE VARIED, THE QUESTION OF THE RESPONSIVENESS OF BUTLER'S BID TO ANY REQUIREMENTS REGARDING THE ACCEPTANCE PERIOD WILL NOT BECOME JUSTICIABLE UNLESS THE DEPARTMENT OF THE ARMY IS UNABLE TO MAKE AWARD TO ANOTHER BIDDER UNTIL 180 DAYS AFTER OPENING. PROCRASTINATION BY GOVERNMENT OFFICIALS IN ORDER TO COMPLY WITH BUTLER'S RESTRICTED ACCEPTANCE PERIOD WOULD IN EFFECT HAVE MODIFIED THE CONTEMPLATED DELIVERY SCHEDULE, AND CONTRACT AWARDED AFTER SUCH DILATORY TACTICS WOULD HAVE BEEN AT VARIANCE WITH THE INTENT IF NOT THE LITERAL TERMS OF THE ADVERTISED INVITATION. SINCE IT IS THE TACIT UNDERSTANDING OF ALL BIDDERS THAT AWARD, IF MADE, WILL BE MADE AS SOON AFTER OPENING OF BIDS AS PRACTICABLE, WE COULD COUNTENANCE NO DELIBERATE DELAY IN AWARDING A CONTRACT WHERE THE PRIMARY REASON FOR SUCH TARDINESS IS TO OBTAIN A LOWER PRICE BY FAVORING A PARTICULAR BIDDER OR BIDDERS WHICH WERE NOT WILLING TO OFFER THEIR BIDS FOR IMMEDIATE ACCEPTANCE.

IN VIEW OF THE ABOVE RECORD, WE HAVE NO OBJECTION TO YOUR PROCEEDING TO MAKE AWARD TO THE LOWEST RESPONSIVE, RESPONSIBLE BIDDER WHOSE OFFER IS BY ITS TERMS PRESENTLY OPEN FOR ACCEPTANCE.

GAO Contacts

Office of Public Affairs