B-156537, JUL. 12, 1965

B-156537, JUL. 12, 1965

TO THE "IXL" PUMP AND MANUFACTURING COMPANY, INC.:

YOUR LETTER OF APRIL 6, 1965, REQUESTS RECONSIDERATION OF A SETTLEMENT CERTIFICATE DATED APRIL 2, 1965, ISSUED BY OUR CLAIMS DIVISION, WHICH DISALLOWED YOUR CLAIM FOR REIMBURSEMENT FOR DRAYAGE CHARGES PAID BY YOU ON PROPERTY FURNISHED TO THE GOVERNMENT UNDER CONTRACT NO. DSA-7-08253, DATED MARCH 23, 1964.

THE CONTRACT WAS AWARDED TO YOU ON THE BASIS OF YOUR BID SUBMITTED UNDER INVITATION FOR BIDS (IFB) NO. DSA-7-64-1763 DATED FEBRUARY 10, 1964, ISSUED BY THE DEFENSE CONSTRUCTION SUPPLY CENTER (DCSC), DEFENSE SUPPLY AGENCY (DSA). THE IFB SOLICITED BIDS ON A TOTAL SMALL BUSINESS SET-ASIDE BASIS TO FURNISH 280 WATER CLOSETS FOR DELIVERY TO THE UTAH DEFENSE DEPOT, OGDEN, UTAH. PAGE 1 OF THE BID SCHEDULE PROVIDED, IN PART, AS FOLLOWS:

"BIDS MAY BE SUBMITTED ON AN F.O.B. ORIGIN BASIS (BID A), OR ON AN F.O.B. DESTINATION BASIS (BID B) OR BOTH. BIDS WILL BE EVALUATED ON THE BASIS OF THE LOWEST OVERALL COST TO THE ERNMENT.'

PAGE 2 OF THE BID SCHEDULE REQUIRED BIDDERS TO FURNISH PLANT NAME AND LOCATION, NAME AND ADDRESS OF THE PACKING PLANT, AND SHIPPING POINT.

PARAGRAPH 34.B OF THE GENERAL PROVISIONS OF THE IFB READS AS FOLLOWS:

"B. F.O.B. ORIGIN (JUL. 1962) THE CONTRACTOR IS RESPONSIBLE FOR LOADING THE SUPPLIES ON THE CARRIER'S VEHICLE, WHARF, OR FREIGHT STATION SPECIFIED BY THE GOVERNMENT, PROVIDED THE CONTRACTOR WILL NOT BE REQUIRED TO BEAR ANY COSTS WHICH WOULD EXCEED HIS COST OF LOADING THE SUPPLIES IN RAILROAD CARS IN THE SAME OR NEAREST CITY HAVING RAIL SERVICE. CONTRACTOR WILL NEVERTHELESS BE REQUIRED TO MAKE THE SPECIFIED DELIVERY AND OBTAIN THE CARRIER'S RECEIPT AND ANY ADDITIONAL COSTS WILL BE ADJUSTED PURSUANT TO THE "CHANGES" CLAUSE. WHERE CONTRACTOR'S SHIPPING PLANT IS LOCATED IN THE SAME CITY (OR COUNTY) LISTED AS A DESTINATION IN THE INVITATION FOR BIDS REQUEST FOR PROPOSALS OR CONTRACT, CONTRACTOR SHALL DELIVER THE SUPPLIES TO THAT DESTINATION AT HIS EXPENSE AND SUCH PORTION OF THE CONTRACT WILL BE F.O.B. DESTINATION. (DSPR 1-1305.4)"

YOUR BID DATED MARCH 5, 1964, WAS THE ONLY BID SUBMITTED UNDER THE IFB. UNDER BID A YOU QUOTED A UNIT PRICE OF $88.40, TOTAL PRICE $24,752, AND NEXT TO THE WORDS "F.O.B. ORIGIN" YOU INSERTED THE NOTATION "IXL PLANT.' UNDER BID B, YOU QUOTED A UNIT PRICE OF $94.35, TOTAL PRICE $26,418, AND NEXT TO THE WORDS "F.O.B. DESTINATION," YOU INSERTED THE NOTATION "VIA MOTOR TRUCK.' YOU NAMED PHILADELPHIA, PENNSYLVANIA, AS THE LOCATION OF YOUR PLANT. THERE WAS NO OTHER NOTATION IN YOUR BID REGARDING TRANSPORTATION, NOR DID YOU OTHERWISE INDICATE ANY INTENT NOT TO ABIDE BY THE TERMS OF PARAGRAPH 34.B OF THE GENERAL PROVISIONS. ACCORDINGLY, THE CONTRACTING OFFICER DID NOT CONSIDER THE NOTATION "IXL PLANT" AS A QUALIFICATION OF YOUR F.O.B. ORIGIN BID, AND YOU WERE NOTIFIED BY LETTER DATED MARCH 23 OF ITS ACCEPTANCE. THE CONFIRMING NOTICE OF AWARD, FORWARDED TO YOU IN APRIL 1964, REFERRED TO YOUR BID AS "F.O.B. ORIGIN PHILADELPHIA, PA.' AND INCLUDED THE FOLLOWING LANGUAGE REGARDING TRANSPORTATION:

"252-1 TRANSPORTATION

F.O.B. CARRIERS EQUIPMENT PHILA, PA. ARTICLE 34B OF THE GENERAL

PROVISIONS, IS APPLICABLE. SHIPMENT TO BE MADE ON A GOVERNMENT BILL

OF LADING.'

BY TELEGRAM DATED MAY 18, YOU REQUESTED THAT IN LIEU OF THE GOVERNMENT BILL OF LADING WHICH HAD BEEN ISSUED TO YOU SPECIFYING ROUTING VIA THE BALTIMORE AND OHIO RAILROAD, THERE BE ISSUED A NEW BILL OF LADING AUTHORIZING MOTOR TRANSPORTATION SINCE THE RAILROADS IN PHILADELPHIA OFFER NO FREE PICKUP SERVICE TO FREIGHT STATIONS AND YOUR F.O.B. BID WAS BASED ON F.O.B. YOUR PLANT. BY TELEGRAM DATED MAY 28, THE CONTRACTING OFFICER DENIED YOUR REQUEST, ADVISING YOU AS FOLLOWS:

"THE BID SUBMITTED BY YOUR FIRM WHICH RESULTED IN CONTRACT NO. DSA 7 08253 HAS BEEN CAREFULLY EXAMINED. IT IS TRUE THAT YOU INDICATED F.O.B. ORIGIN, YOUR PLANT, ON PAGE 2; HOWEVER, YOU DID NOT ALTER OR IN ANY WAY INDICATE THAT YOU DID NOT INTEND TO COMPLY WITH ARTICLE 34B OF THE GENERAL PROVISIONS WHICH IS REFERRED TO ON PAGE 6 OF YOUR BID AND DEFINES F.O.B. ORIGIN. THEREFORE YOUR BID WAS VIEWED AS BEING RESPONSIVE. IF THE MEANING YOU ATTEMPT TO PLACE ON THE WORDS "F.O.B. ORIGIN IXL PLANT" WERE LEGALLY CORRECT, YOUR BID WOULD BE NONRESPONSIVE. ACCORDINGLY YOU ARE REQUESTED TO PROCEED TO SHIP THE SUPPLIES UTILIZING THE GOVERNMENT BILL OF LADING PREVIOUSLY FURNISHED. IF YOU DO NOT CONCUR IN THIS INTERPRETATION OF THE CONTRACT YOU ARE AT LIBERTY TO FILE A COMPLAINT FOR ADDITIONAL COMPENSATION.'

ON JUNE 2, YOU INFORMED THE CONTRACTING OFFICER BY TELEGRAM THAT YOU WOULD SHIP THE ITEMS BY RAIL AS DIRECTED BUT WOULD SUBSEQUENTLY SUBMIT AN INVOICE FOR TRUCKING COSTS FROM YOUR PLANT TO THE BALTIMORE AND OHIO FREIGHT TERMINAL. YOUR CLAIM FOR THE AMOUNT OF $148.06 FOR SUCH COSTS WAS FORWARDED TO OUR OFFICE AND DISALLOWED AS STATED ABOVE.

IT IS YOUR POSITION THAT YOUR BID CLEARLY INDICATED YOUR PRICE WAS BASED F.O.B. YOUR PLANT IN PHILADELPHIA. YOU STATE THAT YOU ASSUMED THE SHIPMENT WOULD MOVE VIA MOTOR FREIGHT AS UNDER A PREVIOUS DSA CONTRACT AND THAT, HAD YOU INTENDED TO INCLUDE IN YOUR PRICE DELIVERY TO A RAIL TERMINAL, YOU WOULD HAVE HAD NO REASON TO SPECIFY F.O.B. YOU PLANT.

THE LANGUAGE OF PARAGRAPH 34.B OF THE GENERAL PROVISIONS CLEARLY PLACED BIDDERS ON NOTICE THAT THE GOVERNMENT RESERVED THE RIGHT TO USE RAIL, MOTOR, OR WATER TRANSPORTATION AT ITS OPTION AND THAT THE SUCCESSFUL BIDDER, OR CONTRACTOR, WOULD BE RESPONSIBLE FOR DELIVERY OF THE SUPPLIES TO THE SPECIFIED CARRIER'S VEHICLE, WHARF, OR FREIGHT STATION, THE COSTS IN CASE OF RAIL SHIPMENT NOT TO EXCEED COSTS TO THE SAME OR NEAREST CITY HAVING RAIL SERVICE. A BID CONDITIONED ON EXEMPTION FROM THE REQUIREMENTS OF PARAGRAPH 34.B WOULD HAVE BEEN NONRESPONSIVE AND COULD NOT HAVE BEEN ACCEPTED BY THE CONTRACTING OFFICER. THEREFORE, THERE IS FOR DETERMINATION WHETHER THE NOTATION ADDED TO YOUR F.O.B. ORIGIN BID WAS SUFFICIENT TO PLACE THE CONTRACTING OFFICER ON NOTICE OF YOUR INTENT NOT TO PAY COSTS FOR DELIVERY TO A RAIL TERMINAL AT PHILADELPHIA OR THE NEAREST CITY HAVING RAIL SERVICE SHOULD THE GOVERNMENT ELECT TO USE RAIL TRANSPORTATION.

AS STATED PREVIOUSLY, YOUR BID BORE NO EXPLANATION OF THE NOTATION, NOR DID YOU IN ANY OTHER MANNER UNDERTAKE TO INDICATE YOUR INTENTION TO TAKE EXCEPTION TO THE PROVISIONS OF PARAGRAPH 34.B. ACCORDINGLY, IT IS OUR VIEW THAT YOUR BID WAS PROPERLY FOR CONSIDERATION AS AN UNCONDITIONAL OFFER TO SHIP THE PROPERTY INVOLVED FROM YOUR PLANT IN ACCORDANCE WITH THE IFB REQUIREMENTS. THEREFORE, UPON ACCEPTANCE OF YOUR BID BY THE CONTRACTING OFFICER, A VALID AND BINDING CONTRACT RESULTED WHICH OBLIGATED YOU TO ASSUME ANY COSTS NECESSARY FOR DRAYAGE OF THE PROPERTY FROM YOUR PLANT IN PHILADELPHIA TO THE CARRIER'S TERMINAL IN PHILADELPHIA OR THE NEAREST CITY HAVING RAIL SERVICE UPON EXERCISE BY THE GOVERNMENT OF ITS OPTION TO USE RAIL TRANSPORTATION.

FOR THE REASONS STATED, THE SETTLEMENT BY OUR CLAIMS DIVISION IS SUSTAINED.