B-157655, JAN. 10, 1966

B-157655, JAN. 10, 1966

TO JOY MANUFACTURING COMPANY:

WE AGAIN REFER TO YOUR LETTER DATED OCTOBER 20, 1965, PROTESTING THE AWARD TO ANY OTHER BIDDER OF A CONTRACT UNDER INVITATION FOR BIDS NO. AMC/T/-04-200-65-146.

THE IFB WAS ISSUED ON MAY 4, 1965, WITH AN OPENING DATE OF MAY 28, 1965, FOR THE PRODUCTION OF A QUANTITY OF VANEAXIAL FANS TO REPLENISH DEPLETED STOCKS. FOUR RESPONSIVE BIDS WERE RECEIVED; HOWEVER, THE LOWEST BIDDER WAS ELIMINATED FOR LACK OF FINANCIAL RESPONSIBILITY. IMC MAGNETICS CORP. WAS THEN THE LOWEST RESPONSIVE RESPONSIBLE BIDDER, WHILE JOY WAS THE HIGHEST OF THE BIDDERS. ON JUNE 8, 1965, JOY MANUFACTURING CO. PROTESTED TO THE SAN FRANCISCO PROCUREMENT DISTRICT THE AWARD TO ANY OTHER BIDDER ON THE GROUNDS THAT JOY IS THE ONLY BIDDER RESPONSIVE TO THE EXACT REQUIREMENTS OF ORDNANCE DRAWINGS NO. 8517073 AND 8517074, AND THE EQUIPMENT APPROVAL REQUIREMENTS OF THE WESTERN ELECTRIC COMPANY, AS STATED IN THE DRAWINGS. WESTERN ELECTRIC HAD ORIGINALLY DESIGNED THE FAN AND THEIR DRAWINGS WERE ADOPTED BY THE ARMY AND INCORPORATED INTO THE IFB.

ON JULY 1, 1965, INQUIRY WAS MADE OF THE U.S. ARMY MISSILE COMMAND, REDSTONE ARSENAL, ALABAMA, AS TO WHETHER JOY MANUFACTURING CO. WAS THE ONLY FIRM CAPABLE OF MAKING THE FAN IN AN ACCEPTABLE MANNER AND, IF NOT, WERE THE ORDNANCE DRAWINGS ADEQUATE FOR COMPETITIVE BIDDING. THE ANSWER RECEIVED WAS THAT THE DRAWINGS WERE ADEQUATE TO SUPPORT COMPETITIVE BIDDING. HOWEVER, ON JULY 22, 1965, THE MISSILE COMMAND STATED THAT IF ONE BIDDER COULD PROVE THAT IT QUALIFIED ACCORDING TO THE REQUIREMENTS IN THE DRAWINGS, THEN THE PROCUREMENT SHOULD BE NEGOTIATED, AND THAT WESTERN ELECTRIC HAD INDICATED THAT JOY MANUFACTURING HAD PREVIOUSLY QUALIFIED ITS FAN. PARAGRAPH 3.8 OF THE ORDNANCE DRAWINGS PROVIDES:

"3.8 LIFE: THE FAN SHALL BE CAPABLE OF OPERATING 23 HOURS PER DAY FOR 3,000 HOURS WITHOUT EXCESSIVE WEAR, BREAKDOWN, IMPAIRMENT OF PERFORMANCE, OR A GENERAL OVERHAUL, AND FOR A TOTAL LIFE OF 10,000 HOURS.'

THE CONTRACTING OFFICER WAS OF THE OPINION THAT THIS PARAGRAPH MEANT THAT THE FAN MUST BE DESIGNED TO RUN FOR THE REQUISITE NUMBER OF HOURS, RATHER THAN THAT THE FAN MUST HAVE BEEN PREQUALIFIED TO THAT STANDARD. HE THUS ASSUMED THE MESSAGE OF JULY 22, FROM THE MISSILE COMMAND, TO BE A NEW REQUIREMENT THAT THE NEEDS OF THE GOVERNMENT DICTATED THE USE OF A PRE- TESTED ITEM, SINCE HE STATED IN PARAGRAPH 6 OF HIS DETERMINATION AND FINDINGS:

"6. IT HAS BEEN ESTABLISHED THAT IN ADDITION TO THE SUPPLEMENTARY REQUIREMENT SET FORTH IN PARAGRAPH 3.8 OF ORDNANCE DRAWING 0-8517073 RELATING TO LIFE CAPABILITY OF THE FAN, AN ADDITIONAL REQUIREMENT IS NECESSARY IN THAT THE FAN MUST HAVE DEMONSTRATED THIS CAPABILITY.'

INASMUCH AS ONLY ONE BIDDER, JOY MANUFACTURING, MET THIS REQUIREMENT, THE CONTRACTING OFFICER CANCELLED THE IFB ON AUGUST 12, 1965, AND, ON AUGUST 16, REQUESTED AN OFFER FROM JOY TO NEGOTIATE THE PROCUREMENT. THE REASON GIVEN ON THE ABSTRACT OF BIDS FOR CANCELLATION WAS:

"THIS IFB IS CANCELLED PURSUANT TO THE PROVISIONS OF ASPR 2-404.1 (B) (I) IN THAT SPECIFICATIONS (DRAWINGS) ARE INADEQUATE AND AMBIGUOUS.'

IN HIS DETERMINATION AND FINDINGS, HE STATED:

"7. THEREFORE, IT IS DETERMINED THAT THE IFB BE CANCELLED PURSUANT TO THE PROVISIONS OF ASPR 2-404.1 (B) (I) IN THAT THE SPECIFICATIONS (DRAWINGS) ARE INADEQUATE TO MEET THE NEEDS OF THE GOVERNMENT, IN THAT THEY DID NOT CLEARLY SET FORTH THE LIFE TEST REQUIREMENTS.'

DURING THIS PERIOD, ON JULY 27, 1965, IMC MAGNETICS HAD ADVISED THE PROCUREMENT DISTRICT THAT THEY HAD TESTED THEIR FAN MOTOR BY RUNNING IT CONTINUOUSLY SINCE JUNE 23, 1960, AND THAT IT WOULD MEET THE 3,000 HOUR PERFORMANCE REQUIREMENT OF PARAGRAPH 3.8. FURTHER, THEY STATED THAT THEY WOULD MEET THE 10,000-HOUR TEST PRIOR TO THE PRODUCTION DELIVERY DATE. AFTER BEING NOTIFIED OF THE IFB CANCELLATION, THEY PROTESTED TO THE PROCUREMENT DISTRICT AND TO THIS OFFICE.

UPON RECEIPT OF IMC'S PROTEST, THE CONTRACTING OFFICER ADVISED THE MISSILE COMMAND OF IMC'S TESTING AND REQUESTED THE MISSILE COMMAND TO VISIT IMC TO SEE IF THEIR FAN WAS SATISFACTORY FOR USE BY THE ARMY. OCTOBER 14, 1965, THE MISSILE COMMAND ADVISED THAT THEY HAD NO OBJECTION TO AWARD OF THE CONTRACT TO IMC AND THAT "THE 3,000 AND 10,000 HOUR PROVISIONS ON THE DRAWING, PARAGRAPH 3.8, DESCRIBED CAPABILITIES AND NOT NECESSARILY PROVEN CHARACTERISTICS.' THE CONTRACTING OFFICER THEN DETERMINED THAT THE IFB HAD BEEN ERRONEOUSLY CANCELLED AND SHOULD BE REINSTATED.

IN SUPPORT OF YOUR PROTEST YOU CONTEND THAT PARAGRAPH 3.1 OF THE DRAWINGS, WHICH PROVIDES:

"3.1 THE SUPPLEMENTARY REQUIREMENTS COVERED IN PART 3 ARE FOR QUALIFICATION TESTS BY THE AGENCY APPROVING THE DESIGN AND APPLICATION OF THESE UNITS AND ARE NOT INTENDED TO BE USED FOR PRODUCTION TESTS.'

INDICATES THAT PARAGRAPH 3.8 ESTABLISHES A REQUIREMENT FOR PRE-BID QUALIFICATIONS FOR THE FAN AND, SINCE JOY IS THE ONLY BIDDER THAT HAS MET THIS REQUIREMENT, IT IS THE ONLY RESPONSIVE BIDDER. A CLOSER EXAMINATION OF THESE PARAGRAPHS AND AN EXAMINATION OF PARAGRAPH 4.1 LEAD US TO ANOTHER CONCLUSION. PARAGRAPH 4.1 PROVIDES:

"4.1 THE MANUFACTURER SHALL PROVIDE THE PRODUCTION TESTING FACILITIES AND PERSONNEL NEEDED BY THE CUSTOMER'S INSPECTORS AT THE MANUFACTURER'S PLANT TO DETERMINE THAT THE PRODUCT MEETS THE REQUIREMENTS OF THIS DRAWING, EXCEPT THOSE REQUIREMENTS LISTED UNDER SUPPLEMENTARY REQUIREMENTS.'

IT IS OUR OPINION THAT PARAGRAPH 3.1 MERELY DISTINGUISHES BETWEEN THOSE STANDARDS TO BE UTILIZED IN WHATEVER QUALIFICATION TESTING THE ARMY MAY PERFORM AND THOSE STANDARDS TO BE USED IN ANY PRODUCTION TESTING. OTHER WORDS, PART 3,"SUPPLEMENTARY REQUIREMENTS," OF THE DRAWINGS WOULD BE USED IN QUALIFICATION TESTING AND PARTS 1, 2 AND 4 IN PRODUCTION TESTING. WITH RESPECT TO PARAGRAPH 3.8, IT IS OUR OPINION THAT THE PLAIN LANGUAGE REFERS TO A DESIGN AND PERFORMANCE CAPABILITY RATHER THAN A PROVEN CHARACTERISTIC. IN NEITHER CASE CAN WE FIND A PRE-BID QUALIFICATION REQUIREMENT.

WE FEEL, THEREFORE, THAT THE CONTRACTING OFFICER WAS IN ERROR WHEN HE CANCELLED THE IFB ON THE GROUNDS THAT IT WAS INDEFINITE AND AMBIGUOUS, SINCE HIS DETERMINATION WAS BASED ON THE SUPPOSED REQUIREMENT OF PRE-BID QUALIFICATION. IT IS WELL ESTABLISHED THAT A CONTRACTING OFFICER MAY CANCEL AN INVITATION FOR BIDS WHEN IN THE BEST INTERESTS OF THE GOVERNMENT. 43 COMP. GEN. 382; 41 ID. 76; 36 ID. 364; 39 COMP. GEN. 396. HOWEVER, WHERE, AS HERE, SUCH A CANCELLATION OF THE IFB IS ERRONEOUS, THE INVITATION MAY AND SHOULD BE REINSTATED AND AWARD MADE TO THE LOW RESPONSIVE AND RESPONSIBLE BIDDER. 39 COMP. GEN. 834; 37 ID. 577; 36 ID. 62; 34 ID. 535. IN THIS CASE, THE CANCELLATION OF THE INVITATION WAS IMPROPER AND REINSTATEMENT WAS THE PROPER ACTION.

IN FURTHER SUPPORT OF YOUR PROTEST, YOU STATE THAT IMC MAGNETICS' BID WAS NONRESPONSIVE IN THAT IT CONTAINED QUALIFYING LANGUAGE. THE LANGUAGE OF WHICH YOU SPEAK IS FOUND ON PAGE 7 OF THE IFB, TO WIT:

"PLEASE NOTE: WE ARE BIDDING ON UNIT PER ORDNANCE CORPS DWG. 8517073.'

AND THE INVITATION PROVIDES FOR THE BID TO BE "IN ACCORDANCE WITH ORDNANCE DRAWINGS NO. 8517073 AND 8517074.' YOU CONTEND THAT IMC QUALIFIED THEIR BID BY BIDDING ON ONLY ONE DRAWING AND, THUS, WAS NONRESPONSIVE. PARAGRAPH 1.2 OF DRAWING 8517073 PROVIDES:

"1.2 MOTOR: THE FAN SHALL BE FURNISHED WITH AN 8517074 MOTOR.'

THUS, DRAWING 8517074 IS INCORPORATED INTO DRAWING 8517073, AND, THEREFORE, IMC'S BID INCLUDES BOTH DRAWINGS.

YOU ALSO CONTEND THAT IMC MAGNETICS CORP. FAILED TO FURNISH CERTAIN DESCRIPTIVE LITERATURE REQUIRED BY THE INVITATION FOR BIDS AND, THEREFORE, IS NONRESPONSIVE. YOU CITE PARAGRAPH 6 OF THE IFB, WHICH PROVIDES IN PART:

"/A) DESCRIPTIVE LITERATURE AS SPECIFIED IN THIS INVITATION FOR BIDS MUST BE FURNISHED AS A PART OF THE BID AND MUST BE RECEIVED BEFORE THE TIME SET FOR OPENING BIDS.'

THIS PARAGRAPH IS A STANDARD CLAUSE PERTAINING TO ANY DESCRIPTIVE LITERATURE WHICH MIGHT BE REQUIRED BY THE IFB. HOWEVER, THERE WAS NO REQUIREMENT FOR THE FURNISHING OF DESCRIPTIVE LITERATURE.