B-156608, JUL. 7, 1965

B-156608, JUL. 7, 1965

TO RED CIRCLE CORPORATION:

FURTHER REFERENCE IS MADE TO YOUR TELEGRAM OF APRIL 22, 1965, AND SUPPLEMENTARY LETTER OF MAY 14, 1965, WITH ENCLOSURE, PROTESTING AGAINST THE AWARD OF A CONTRACT UNDER IFB DSA-4-65-1771.

UNDER THE INVITATION, ISSUED BY THE DIRECTORATE OF PROCUREMENT AND PRODUCTION, DEFENSE GENERAL SUPPLY CENTER, RICHMOND, VIRGINIA, BIDS, TO BE OPENED APRIL 8, 1965, WERE REQUESTED ON A UNIT PRICE BASIS FOR FURNISHING A TOTAL OF 50 CHAPEL BULLETIN BOARDS IN ACCORDANCE WITH MILITARY STANDARD MS16095, REVISION B, DATED OCTOBER 9, 1958.

OF THE THREE BIDS SUBMITTED IN RESPONSE TO THE INVITATION, THE BID OF AUTO SKATE COMPANY, INC., IN THE AMOUNT OF $191 EACH FOR THE BULLETIN BOARDS, WAS THE LOWEST RECEIVED. YOUR BID, IN THE UNIT PRICE AMOUNT OF $232, WAS THE NEXT LOWEST BID.

NO CONTENTION THAT THE MILITARY STANDARD SPECIFICATION CITED CONTAINED ANY DEFECTS WAS MADE PRIOR TO BID OPENING BY ANY OF THE BIDDERS, OR BY ANY OF THE REMAINING 21 POTENTIAL SUPPLIERS WHO RECEIVED INVITATIONS BUT DID NOT BID. HOWEVER, BY LETTER OF APRIL 22, 1965, YOU ADVISED THE DEFENSE GENERAL SUPPLY CENTER THAT YOU PROTESTED AGAINST ANY AWARD UNDER THE INVITATION DUE TO ERROR DISCOVERED IN THE SPECIFICATIONS.

IN YOUR FOLLOWUP LETTER OF MAY 5, 1965, TO THE PROCURING ACTIVITY YOU STATED THAT ON SHEET 8 OF MS16095 (A DRAWING) THE LOCATION AND DIAMETER OF HOLES FOR PART NO. 29 (THE LOCK) WERE WRONG, AND THAT AN ATTEMPT BY A CONTRACTOR TO INSTALL THE PART WOULD RESULT IN THE ENTIRE DOOR TO EACH OF THE BULLETIN BOARDS BEING SCRAPPED AND IN A CLAIM AGAINST THE GOVERNMENT FOR ADDITIONAL COMPENSATION UNDER THE "CHANGES" CLAUSE OF THE CONTRACT. ALSO, YOU STATED THAT ON SHEET 5 OF MS16095 "MANY DIMENSIONS OF COMPONENTS SCREWED AND GLUED IN POSITION" WERE "INTERFERING," CAUSING EXPENSIVE REIMBURSABLE REWORK BY A CONTRACTOR. IN REQUESTING, IN SUBSTANCE, THAT THE INVITATION BE CANCELLED, YOU STATED THAT ON PRIOR CONTRACTS FOR THE ITEM YOU HAD BEEN GUIDED BY YOUR OWN SHOP DRAWINGS AND CONSEQUENTLY DID NOT HAVE TO PERFORM UNNECESSARY REWORK RESULTING FROM THE INADEQUATE SPECIFICATIONS AND DRAWINGS, BUT THAT A NEW CONTRACT WOULD INCUR EXTRA COSTS AS A RESULT OF THE DEFECTIVE DRAWINGS WHICH WOULD RESULT IN ADDITIONAL COST AND DELAYS TO THE GOVERNMENT.

IN A LETTER DATED MAY 12, 1965, TO THE DEFENSE GENERAL SUPPLY CENTER, WHICH REFERS TO A CONVERSATION HELD WITH A MR. BUTLER IN REGARD TO YOUR PROTEST, YOU FURNISHED MORE DETAILS CONCERNING THE ALLEGEDLY FAULTY ENGINEERING DATA CONTAINED IN THE SPECIFICATIONS FOR THE BULLETIN BOARD, AND THE CORRECTIONS WHICH WOULD BE REQUIRED. BY LETTER OF MAY 14, 1965, YOU FURNISHED US A COPY OF THE MAY 12 LETTER IN SUPPORT OF YOUR PROTEST, STATING:

"THE ATTACHED LETTER IS SELF EXPLANATORY INASMUCH AS IT POINTS OUT THAT ANY OTHER CONTRACTOR WOULD CAUSE A WASTAGE OF MATERIALS AND LABOR IF HE FOLLOWED MS16095 REV-B.

"WE BECAME AWARE OF THESE DISCREPANCIES AS WE WERE SUBMITTING OUR BID AND THEREFORE INCLUDED AN AMOUNT TO COVER ENGINEERING DEVELOPMENT EFFORT NECESSARY TO BRING THE SPECIFICATIONS INTO ALINEMENT BY OUR INTENTION TO REQUEST WAIVERS. THIS ADDED AMOUNT OF ENGINEERING WHICH WE DETERMINED TO BE NECESSARY CAUSED OUR BID TO BE HIGHER AND CONSEQUENTLY PREJUDICED OUR COMPETITIVE POSITION.

"WE REQUEST THIS BID BE WITHDRAWN UNTIL THE SPECIFICATION CAN BE REVISED. * * *"

BY LETTER OF JUNE 14, 1965, THE DEFENSE SUPPLY AGENCY, IN RESPONDING TO OUR REQUEST FOR A COMPLETE REPORT IN THIS MATTER, FURNISHED US WITH A REPORT DATED JUNE 3, 1965, BY THE CONTRACTING OFFICER WHICH ADVISES, IN PERTINENT PART, AS FOLLOWS:

"8. RED CIRCLE CORPORATION HAS CLAIMED THAT BOTH OF ITS FIRST TWO LISTED DISCREPANCIES MUST BE CORRECTED IN THE MANNER SPECIFIED BY IT TO ACCORD WITH USE OF THE CORBIN CABINET LOCK NO. 0750. IT IS AGREED THAT IF THE CORBIN CABINET LOCK NO. 0750 IS USED, THE TWO HOLES SHOULD BE 1/8 INCH LARGER IN DIAMETER AND PLACED FURTHER FROM THE EDGE AND THAT MORE CLEARANCE FOR THE LOCKS WILL BE PROVIDED IF THE DIMENSIONS ON PART 6 ARE CHANGED TO PERMIT A SPACE OF 3 1/4 INCHES RATHER THAN 2 1/4 INCHES AROUND THE LOCKS. HOWEVER, THE MILITARY STANDARD PROVIDES IN GENERAL NOTE NO. 12 THAT THE LOCK (PIECE 29) SHALL BE CORBIN CABINET LOCK NO. 0750 OR EQUAL. IT IS BELIEVED THAT IT WILL BE APPARENT TO ANY MANUFACTURER THAT THE HOLES FOR THE LOCK AND THE SPACE FOR THE LOCK IN THE DOOR BACKING STRIP BEHIND THE LOCK MUST BE COMPATIBLE WITH THE LOCK ACTUALLY USED. IF A MANUFACTURER USES A LOCK EQUAL TO BUT LARGER THAN THE CORBIN CABINET LOCK NO. 0750, HE WILL OBVIOUSLY HAVE TO MAKE SOME ADJUSTMENT IN THE LOCK HOLES AND SPACE FOR THE LOCK IN THE DOOR BACKING STRIP EVEN BEYOND THAT RECOMMENDED BY RED CIRCLE CORPORATION. IT IS INTENDED IN THIS PROCUREMENT TO CAUTION THE SUCCESSFUL BIDDER THAT THE HOLES FOR THE LOCKS AND THE CLEARANCE FOR THE LOCKS IN THE DOOR BACKING STRIP SHOULD BE INCREASED IF HE INTENDS TO USE THE CORBIN LOCK. HOWEVER, THIS SHOULD NOT RESULT IN ANY ADDITIONAL COST.

"9. RED CIRCLE CORPORATION HAD TWO ADVERTISED CONTRACTS IN 1964, CONTRACTS NO. DSA 4-026683-SF610 AND DSA 4-035333-SF610 AND SEVERAL PURCHASE ORDERS. (SEE EX 7). COPIES OF THE TWO CONTRACTS ARE ENCLOSED. (EX 8 AND 9). THE CONTRACT FILES HAVE BEEN REVIEWED. BOTH CONTRACTS CITED REV. B OF MILITARY STANDARD MS16095 AND LIST DETAILED INSPECTIONS THAT THE SUPPLIER IS RESPONSIBLE FOR MAKING. THE PRE AWARD FILE FOR CONTRACT NO. DSA 4-035333-SF610 SHOWS THAT THE CORBIN CABINET LOCK NO. 0750 WAS TO BE USED. THE LOCK USED IN THE OTHER CONTRACT IS NOT KNOWN. IN NEITHER CONTRACT DID RED CIRCLE CORPORATION REQUEST ANY DEVIATION FROM THE MILITARY STANDARD. ACCORDINGLY, IT IS ASSUMED THAT THE MINOR CHANGES NECESSARY TO ACCOMMODATE THE CORBIN LOCK WERE MADE BY RED CIRCLE CORPORATION IN MANUFACTURE AND WERE CONSIDERED BY RED CIRCLE CORPORATION TO BE SO INSIGNIFICANT THAT THE CHANGES NEITHER INTERFERED WITH ITS MEETING INSPECTION REQUIREMENTS OR NECESSITATED ANY DEVIATION TO THE CONTRACT PROVISIONS. IT WAS ALSO NOTED IN THE PRE-AWARD FILE FOR CONTRACT NO. 4-026683-SF610 THAT RED CIRCLE CORPORATION REQUESTED BY TELEGRAM DATED 17 MARCH 1964 THAT "OPENING BE HELD IN ABEYANCE OF YOUR CONSIDERATION OF OUR RECOMMENDED CHANGES TO MS16095 BASED ON UPDATING OF SPEC AND DRAWINGS INCONSISTENCIES EVIDENT BY OUR RECENT CONTRACT PERFORMANCE ON THIS ITEM. RECOMMENDATION BEING FORWARDED BY LETTER.' (EX 10). BEFORE OPENING RED CIRCLE CORPORATION ASKED THAT THIS TELEGRAM BE DISREGARDED AND DID NOT FURNISH ANY RECOMMENDATIONS.

"10. IT IS NOTED THAT REVISION B TO MILITARY STANDARD MS16095 WAS MADE ON 9 OCTOBER 1958. IN VIEW OF THE CONTRACTS AND PURCHASE ORDERS PERFORMED BY RED CIRCLE CORPORATION SINCE REVISION B WAS ISSUED AND IN VIEW OF ITS TELEGRAM OF 17 MARCH 1964, IT APPEARS INCREDIBLE THAT RED CIRCLE CORPORATION COULD HAVE BECOME "AWARE OF THESE DISCREPANCIES AS WE WERE SUBMITTING OUR BID AND THEREFORE INCLUDED AN AMOUNT TO COVER ENGINEERING DEVELOPMENT" AS IT ALLEGES IN ITS LETTER OF 14 MAY 1965 ADDRESSED TO THE UNITED STATES GENERAL ACCOUNTING OFFICE.

"11. TWO OF THE OTHER DISCREPANCIES NOTED BY RED CIRCLE CORPORATION ARE THAT THE NUMBER OF LETTER HOLDERS SHOULD BE INDEFINITE AND THAT BOTH LOCKS SHOULD BE KEYED ALIKE. THESE FEATURES ARE NOT ERRORS, BUT ARE AT MOST SUGGESTED CHANGES. THE FIRST OF THESE CHANGES IS NOT CONSIDERED DESIRABLE. THE SECOND CHANGE COULD BE MADE BUT IF THE CONTRACTOR NOW KEYS THE LOCKS DIFFERENTLY THE ONLY EFFECT IS THAT HE MUST SUPPLY BOTH KEYS.

"12. THE FINAL DISCREPANCY NOTED IS THAT THE PAINT COLOR IS SPECIFIED BY A NUMBERING SYSTEM PREVIOUSLY IN USE. HOWEVER, IF THE CONTRACTOR ORDERS AND IS SUPPLIED PAINT UNDER THE OLD NUMBER, IT WILL BE THE SAME COLOR AS PAINT ORDERED AND SUPPLIED UNDER THE CURRENT NUMBER.

"13. IN SUMMARY IT APPEARS THAT MILITARY STANDARD MS16095 CONTAINS NO ERRORS RED CIRCLE CORPORATION CONSIDERED SIGNIFICANT UNTIL INVITATION FOR BIDS NO. DSA 4-65-1771 WAS OPENED AND THE PRICES OF ALL BIDDERS WERE REVEALED. IF THE EXACT DIMENSIONAL CORRECTIONS REQUESTED BY RED CIRCLE CORPORATION WERE MADE, THEY WOULD NOT BE BENEFICIAL TO ANYONE USING A LOCK EQUAL TO BUT DIFFERENT IN SIZE FROM THE CORBIN LOCK. ACCORDINGLY, IT IS FELT THAT THE PRIMARY EFFECT OF A CANCELLATION OF IFB DSA 4-65-1771 AND READVERTISEMENT WOULD BE TO OFFER RED CIRCLE CORPORATION A CHANCE TO REVISE ITS BID PRICE AFTER CONSIDERATION OF THE LOW BID RECEIVED UNDER IFB DSA 4-65-1771. UNDER THESE CIRCUMSTANCES THE UNDERSIGNED CONSIDERS THAT CANCELLATION OF THE INVITATION WOULD BE UNDESIRABLE AND PREJUDICIAL TO THE LOW BIDDER.'

IN ITS LETTER OF JUNE 14 THE DEFENSE SUPPLY AGENCY STATES:

"BASED ON THE INFORMATION CONTAINED IN THE (ABOVE-QUOTED) REPORT, IT IS RECOMMENDED THAT THE PROTEST BE DENIED. IT IS OBVIOUS THAT THE ADJUSTMENT IN THE SIZES AND LOCATION OF THE HOLES IN THE DOOR FRAME AND IN THE DEPTH OF THE RECESS IN THE DOOR BACKING STRIP TO ACCOMMODATE THE CORBIN LOCK ARE COMPARATIVELY MINOR AND SHOULD NOT RESULT IN ADDITIONAL COSTS, PROVIDED THAT THE SUCCESSFUL CONTRACTOR IS MADE AWARE OF THE NECESSITY FOR SUCH ADJUSTMENTS PRIOR TO BEGINNING WORK ON THE CONTRACT. IT IS NOT CONSIDERED THAT THIS DISCREPANCY IS SUFFICIENTLY SERIOUS TO WARRANT CANCELLATION OF THE INVITATION AFTER THE BIDS HAVE BEEN OPENED. THE REMAINING POINTS REFERRED TO AS DISCREPANCIES DO NOT REPRESENT ANY CONFLICT IN SPECIFICATIONS WHICH WOULD NECESSITATE A CHANGE UNDER A CONTRACT.

"THE DEFENSE GENERAL SUPPLY CENTER HAS ADVISED THAT, FOR ANY FUTURE REQUIREMENTS, NECESSARY CLARIFICATION WILL BE WORKED OUT WITH THE ACTIVITY RESPONSIBLE FOR THE SPECIFICATIONS.'

AS INDICATED IN THE CONTRACTING OFFICER'S ABOVE-QUOTED REPORT, UNDER CONTRACTS NOS. DSA-4-026683-SF610 AND DSA-4-035333-SF610, AWARDED ON APRIL 15, 1964, AND JULY 14, 1964, RESPECTIVELY, YOU FURNISHED CHAPEL BULLETIN BOARDS IN ACCORDANCE WITH THE IDENTICAL SPECIFICATIONS HERE INVOLVED. MOREOVER, AS NOTED ABOVE, YOU STATED IN YOUR LETTER OF MAY 5, 1965, THAT ON PRIOR CONTRACTS FOR THE ITEM INVOLVED YOU HAD BEEN GUIDED BY YOUR OWN SHOP DRAWINGS AND CONSEQUENTLY DID NOT HAVE TO PERFORM UNNECESSARY REWORK RESULTING FROM THE INADEQUATE SPECIFICATIONS AND DRAWINGS. UNDER THE CIRCUMSTANCES, THE ASSERTION IN YOUR LETTER OF MAY 14, 1965, THAT YOU BECAME AWARE OF THE REFERRED TO DISCREPANCIES IN THE SPECIFICATIONS "AS WE WERE SUBMITTING OUR BID" APPEARS TO BE INCONSISTENT WITH THE RECORD.

WITH REGARD TO YOUR STATEMENT THAT THE ADDED AMOUNT OF ENGINEERING WHICH YOU DETERMINED TO BE NECESSARY CAUSED YOUR BID TO BE HIGHER AND CONSEQUENTLY PREJUDICED YOUR COMPETITIVE POSITION, THE CONTRACTING OFFICER HAS, AS INDICATED ABOVE, EXPRESSED THE OPINION THAT THE CORRECTIVE ADJUSTMENTS NECESSARY TO BE MADE IN THE SPECIFICATIONS ARE OF SUCH A MINOR NATURE AS NOT TO ENTITLE A CONTRACTOR TO ADDITIONAL COMPENSATION UNDER THE CONTRACT. THE FACT THAT YOU DID NOT PRESENT A CLAIM TO THE CONTRACTING OFFICER BY REASON THEREOF UNDER THE "CHANGES" CLAUSE IN CONNECTION WITH THE PERFORMANCE OF YOUR EARLIER CONTRACTS WOULD INDICATE THAT YOU WERE OF THE SAME OPINION. IF YOU WERE CONCERNED THAT YOUR COMPETITIVE POSITION IN BIDDING ON THE SUBJECT CONTRACT MIGHT BE JEOPARDIZED BECAUSE OF THE OTHER BIDDERS WOULD NOT BE AWARE OF THE "ADDED AMOUNT OF ENGINEERING" WHICH YOU KNEW WAS NECESSARY, IT WOULD APPEAR THAT YOU WERE IN A POSITION TO PROTECT YOURSELF BY POINTING OUT THE DISCREPANCIES IN THE SPECIFICATIONS TO THE CONTRACTING OFFICER PRIOR TO BID OPENING IN ORDER THAT HE MIGHT BRING THEM TO THE ATTENTION OF OTHER BIDDERS BY AN ADDENDUM TO THE INVITATION, IF NECESSARY.

IN VIEW OF THE STATEMENTS OF THE CONTRACTING OFFICER WITH RESPECT TO THE ALLEGED DEFECTS IN THE SPECIFICATIONS, AND CONSIDERING ALSO THE FACT THAT NO OTHER BIDDER HAS OBJECTED TO THE SPECIFICATIONS AND THAT YOU HAVE PREVIOUSLY PERFORMED TO THE SAME SPECIFICATIONS WITHOUT CLAIMING ADDITIONAL COMPENSATION, WE FIND NO SUBSTANTIAL BASIS FOR YOUR PROTEST, WHICH MUST THEREFORE BE DENIED.