B-237481, Oct 30, 1989, 89-2 CPD 400

B-237481: Oct 30, 1989

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PROCUREMENT - Sealed Bidding - Bid guarantees - Sureties - Acceptability DIGEST: Bid was properly rejected for a defective bid bond where bond listed one company as surety and contained power of attorney and seal from another company. Schartz's bid was rejected because of a defective bid bond. The bond's power of attorney and seal were from the Continental Insurance Company. Schartz explains that the discrepancy was the result of a typographical error committed by its insurance agent. According to the protester the Continental Insurance Company was the intended surety. A bid bond is a material part of a bid and. When a bidder supplies a defective bond the bid itself is rendered defective and must be rejected as nonresponsive.

B-237481, Oct 30, 1989, 89-2 CPD 400

PROCUREMENT - Sealed Bidding - Bid guarantees - Sureties - Acceptability DIGEST: Bid was properly rejected for a defective bid bond where bond listed one company as surety and contained power of attorney and seal from another company.

Jay Schartz Contracting:

Jay Schartz Contracting protests the rejection of its low bid submitted in response to solicitation No. R6-15-90-5 issued by the Forest Service, United States Department of Agriculture for tree planting at the Umpqua National Forest, Diamond Lake Ranger District. Schartz's bid was rejected because of a defective bid bond.

We dismiss the protest.

Schartz's bid bond listed Continental Guaranty Credit Corporation as the surety. However, the bond's power of attorney and seal were from the Continental Insurance Company. Schartz explains that the discrepancy was the result of a typographical error committed by its insurance agent-- the agent placed the wrong company's name as surety on the bond. According to the protester the Continental Insurance Company was the intended surety.

When required by a solicitation, a bid bond is a material part of a bid and, therefore, must be furnished with it. When a bidder supplies a defective bond the bid itself is rendered defective and must be rejected as nonresponsive. The determinative question as to the acceptability of a bid bond is whether the bidding documents establish that the bond could be enforced if the bidder did not execute the contract. Minority Enterprises, Inc., B-216667, Jan. 18, 1985, 85-1 CPD Para. 57.

Here, the bid bond shows one corporate entity as the surety while the power of attorney and seal are from a different corporation. It is therefore clear that the bond could not be enforced against either firm and was therefore unacceptable. See Baker-Roberts, Inc., B-213148, Feb. 14, 1984, 84-1 CPD Para. 195. The bid was thus properly rejected as nonresponsive.

Schartz has submitted a letter from its insurance agent stating that Continental Insurance Company would have honored the bond such evidence cannot be considered since a nonresponsive bid cannot be made responsive after bid opening through an explanation of what was intended. Minority Enterprises, Inc., B-216667, supra.

The protest is dismissed.