B-161984, JAN. 29, 1968

B-161984, JAN. 29, 1968

BIDS - DEVIATIONS DECISION TO SECY. OF THE ARMY CONCERNING PROTEST AGAINST AWARD TO BE CU MANUFACTURING CO., INC. BY AMMUNITION PROCUREMENT AND SUPPLY AGENCY, JOLIET, ILL. A BIDDER WHO DID NOT FURNISH GUARANTEED SHIPPING WEIGHT INFORMATION THAT COMPLIED WITH THE PACKING REQUIREMENTS OF THE SPECIFICATIONS AND WHO WAS PERMITTED AFTER OPENING TO FURNISH INFORMATION REGARDING COMPLIANCE SHOULD NOT HAVE BEEN AFFORDED A SECOND CHANCE TO BID. THE DEVIATIONS CONSTITUTED A MATERIAL PART OF THE BID AND WHERE A BIDDER EXECUTED THE SHIPPING WEIGHT CLAUSE SUCH EXECUTION MUST BE CONSTRUED AS EXPRESS STATEMENTS OF THE BIDDER AND CONDITIONS IN HIS BID. SINCE BID OF SUCCESSFUL BIDDER WAS CLEARLY LOWER THAN PROTESTANT'S BEFORE EVALUATION OF TRANSPORTATION COSTS AND PROTESTANT DID NOT FURNISH F.O.B. DESTINATION PRICE, IT IS SPECULATIVE WHETHER ADVANTAGE ACCRUED TO CONTRACTOR. THEREFOR CANCELLATION WOULD NOT BE IN INTEREST OF GOVT. IN FUTURE BIDDERS SHOULD NOT BE PERMITTED TO SUPPLEMENT OR CHANGE BIDS AFTER OPENING.

TO MR. SECRETARY:

REFERENCE IS MADE TO LETTERS DATED AUGUST 28, 1967, AND OCTOBER 18, 1967, FROM THE OFFICE OF THE DIRECTOR OF PROCUREMENT AND PRODUCTION, UNITED STATES ARMY MATERIEL COMMAND, FURNISHING REPORTS ON THE PROTEST OF METL- PRES, INCORPORATED, AGAINST THE ACTION OF THE AMMUNITION PROCUREMENT AND SUPPLY AGENCY, JOLIET, ILLINOIS, IN AWARDING A CONTRACT TO BE CU MANUFACTURING COMPANY, INCORPORATED, UNDER INVITATION FOR BIDS NO. DAAA09- 67-B-0055, ISSUED MAY 22, 1967.

THE INVITATION REQUESTED BIDS FOR SUPPLYING 3,000,000 EACH, CLIP, SAFETY RETAINING, ARMING WIRE, STEEL P/N 66D37855, ON F.O.B. ORIGIN AND DESTINATION BASES. THREE BIDS WERE RECEIVED. BE CU BID UNIT PRICES OF $ 0.06472 ORIGIN AND $ 0.06512 DESTINATION, LESS PROMPT DISCOUNT OF ONE PERCENT. METL-PRES BID ORIGIN ONLY AT $ 0.082 PER UNIT LESS DISCOUNT OF ONE-TENTH OF ONE PERCENT. THE REMAINING BID WAS NOT IN CONTENTION.

THE INVITATION CONTAINED THE FOLLOWING CLAUSE, WHICH WAS FILLED OUT BY BE CU AS FOLLOWS:

"GUARANTEED MAXIMUM SHIPPING WEIGHTS FOR F.O.B. ORIGIN DELIVERIES

THE BIDDER MUST COMPLETE THE FOLLOWING GUARANTEED MAXIMUM SHIPPING WEIGHT INFORMATION FOR USE IN DETERMINATION OF TRANSPORTATION COSTS OR THE BID WILL BE REJECTED. * * *

TYPE OF BOX: WOOD X FIBER

SIZE: 2 X 2 X 2 CUBE 8 FT

NUMBER OF ITEMS PER BOX 20,000 EACH

GROSS WEIGHT OF BOX AND CONTENTS 400 LBS

* * * * * * * NOTE: THE BIDDER WILL COMPLETE THE APPLICABLE INFORMATION OF ABOVE FOR EACH PART OR COMPONENT WHICH IS PACKED OR PACKAGED SEPARATELY.' THE CLAUSE ALSO PROVIDED THAT THE CONTRACT PRICE WOULD BE REDUCED BY THE AMOUNT OF ANY TRANSPORTATION COSTS IN EXCESS OF THOSE BASED ON THE MAXIMUM WEIGHTS AND DIMENSIONS THE BIDDER HAD GUARANTEED.

BIDS WERE OPENED ON JUNE 5, 1967, AND A CONTRACT WAS AWARDED TO BE CU COMPANY ON JUNE 22, 1967. ON JUNE 26, 1967, METL-PRES, INCORPORATED, FILED A WRITTEN PROTEST WITH THE COMMANDING OFFICER, AMMUNITION PROCUREMENT AND SUPPLY AGENCY, ALLEGING THAT THE BID OF BE CU CONTAINED CERTAIN IMPROPRIETIES AND OMISSIONS WHICH GAVE THE FIRM AN UNDUE ADVANTAGE OVER BIDDERS WHO COMPLIED WITH THE REQUIREMENTS OF THE INVITATION FOR BIDS AND THAT THE AWARD OF THE CONTRACT WAS IN VIOLATION OF 10 U.S.C. 2305 (C) IN THAT THE BID DID NOT CONFORM TO THE INVITATION IN THREE RESPECTS: (1) PAGE 2 OF THE BID SET, ITEM 1, WAS INCOMPLETE; (2) FORMS DD 1423 WERE SUBMITTED BLANK CONTRARY TO INSTRUCTIONS CONTAINED ON PAGE 33 OF THE IFB; AND (3) ON PAGE 11, PARAGRAPH F IN THE GUARANTEED MAXIMUM WEIGHT CLAUSE, THE BIDDER INDICATED HE WOULD PACK 20,000 UNITS PER BOX ALTHOUGH ONLY 10,000 UNITS WERE TO BE PACKED PER BOX UNDER SECTION 5-2-1 OF THE PROPOSED MILITARY SPECIFICATIONS 00-YEC-33067, DATED MARCH 24, 1967, INCLUDED IN THE BID SET AND MADE APPLICABLE BY RDM-67-1312 DATED MAY 3, 1967, IN ACCORDANCE WITH THE LANGUAGE AT THE TOP OF PAGE 5 OF THE INVITATION.

THE CONTRACTING OFFICER CONSIDERED BE CU'S BID TO BE RESPONSIVE AFTER DETERMINING THAT ITEM 1, PAGE 2 OF THE BID SET WAS COMPLETE AND CORRECT AND THAT OMISSIONS IN FORM DD 1423, WHICH HAD NO EFFECT ON THE EVALUATION OF OFFERS, COULD BE WAIVED AS A MINOR INFORMALITY PURSUANT TO ASPR 2-405 (VI). THE CONTRACTING OFFICER ALSO DETERMINED THAT BE CU'S ENTRY OF 20,000 UNITS PER BOS IN THE GUARANTEED MAXIMUM SHIPPING WEIGHT CLAUSE WAS NOT AN EXCEPTION TO THE SPECIFICATIONS. THE REASONING FOR HIS DETERMINATION IS GIVEN IN HIS SUPPLEMENTAL REPORT OF OCTOBER 9, 1967, WHEREIN HE STATES THAT THE INFORMATION GIVEN IN THE GUARANTEED MAXIMUM SHIPPING WEIGHT CLAUSE IS FOR USE IN DETERMINING TRANSPORTATION COSTS, AND THAT SUCH INFORMATION CANNOT BE USED TO DETERMINE THE BIDDER'S INTENT WITH RESPECT TO PACKING SPECIFICATIONS. HE SEEMS ALSO TO HAVE PLACED RELIANCE ON A LETTER WRITTEN BY BE CU ON JUNE 12, 1967, AFTER BID OPENING IN WHICH THE COMPANY STATED: "WITH REFERENCE TO PARAGRAPH F, -GUARANTEED MAXIMUM SHIPPING WEIGHTS-, PLEASE BE ADVISED THAT SHIPMENTS WILL BE PACKAGED, PACKED AND SHIPPED IN ACCORDANCE WITH THE SOLICITATION AND ALL REQUIREMENTS REFERENCED THEREIN.'

IT SHOULD FIRST BE NOTED THAT THE RESPONSIVENESS OF BE CU'S BID MUST BE DETERMINED ON THE BASIS OF THE BID ITSELF, WITHOUT REGARD TO WHAT IT MAY HAVE PROMISED AFTER BID OPENING. THERE IS NO QUESTION THAT BE CU'S ENTRIES IN THE GUARANTEED MAXIMUM SHIPPING WEIGHT CLAUSE CLEARLY SHOWED ITS INTENTION TO PACK 20,000 UNITS PER BOX. IN ADDITION TO THAT ENTRY, BE CU SHOWED THE WEIGHT PER BOX AS 400 POUNDS AND THE SIZE AS 8 CUBIC FEET. THE BID OF METL-PRES SHOWED A WEIGHT PER BOX OF 10,000 UNITS AS 185 POUNDS AND THE SIZE AS 2 CUBIC FEET. IT HAS NOT BEEN CONTENDED THAT THE PACKING OF 20,000 UNITS PER BOX WOULD BE ACCEPTABLE, AND WE ASSUME IT WOULD NOT.

IT IS STATED IN A SUPPLEMENTAL MEMORANDUM OF LAW THAT INFORMATION GIVEN IN THE SHIPPING WEIGHT CLAUSE IS SOLELY FOR THE DETERMINATION OF TRANSPORTATION COSTS AND, IN SUBSTANCE, THAT IF SUCH INFORMATION IS IN CONFLICT WITH THE REQUIREMENTS OF PACKING SPECIFICATIONS, THE LATTER WOULD BE CONTROLLING ON THE BIDDER. WE CANNOT AGREE WITH THIS REASONING. THE PROVISIONS, EXECUTED BY A BIDDER, UNDER THE GUARANTEED MAXIMUM WEIGHT CLAUSE OF AN INVITATION DIRECTLY AFFECT CONTRACT COST AND CONTRACT PERFORMANCE. AS SUCH THEY CONSTITUTE A MATERIAL PART OF THE BID, AND WHERE A BIDDER HAS EXECUTED THESE PROVISIONS OF THE BID FORM, SUCH EXECUTION MUST BE CONSTRUED AS EXPRESS STATEMENTS OF THE BIDDER AND CONDITIONS OF HIS BID. THEY MAY NOT BE CONSIDERED MINOR OR BE DISREGARDED IF THEY ARE INCONSISTENT OR IN CONFLICT WITH ANOTHER PORTION OF THE BID. WHILE THE OFFICE OF COUNSEL HAS CITED NUMEROUS DECISIONS OF THIS OFFICE, NOT HERE RESTATED, WHEREIN THE RULE THAT INACCURACIES IN GUARANTEED SHIPPING DATA DO NOT RENDER A BID NONRESPONSIVE, THAT RULE DOES NOT EXTEND TO A CASE WHERE THE INACCURATE DATA CONSTITUTE AN EXCEPTION TO THE INVITATION REQUIREMENTS. SEE B-161801, DATED SEPTEMBER 6, 1967.

IT IS NOT UNUSUAL FOR BIDDERS TO OFFER MATERIALS WHICH DO NOT COMPLY WITH THE ADVERTISED SPECIFICATIONS, EITHER WITH KNOWLEDGE OF SUCH FACT OR BECAUSE OF A MISTAKEN BELIEF AS TO ONE OR MORE OF THE ESSENTIAL REQUIREMENTS OF THE INVITATION FOR BIDS. IF A BID IS SO PREPARED AS TO CREATE A REASONABLE DOUBT CONCERNING THE BIDDER'S INTENTION TO FURNISH PACKAGING MEETING THE MATERIAL REQUIREMENT OF THE SPECIFICATIONS, ANY NEGOTIATIONS WITH THE BIDDER TO CLARIFY SUCH INTENTIONS ARE OBJECTIONABLE ON THE GROUND THAT NO BIDDER SHOULD BE AFFORDED A SECOND CHANCE TO BID AFTER ITS BID IS OPENED.

AS STATED ABOVE, BE CU WAS AWARDED THE CONTRACT ON THE BASIS THAT ITS F.O.B. DESTINATION PRICE WAS CLEARLY LOWER THAN THE METL-PRES F.O.B. ORIGIN PRICE EVEN BEFORE EVALUATION OF TRANSPORTATION COSTS. METL-PRES DID NOT SUBMIT AN F.O.B. DESTINATION PRICE AND WHILE THE ESSENTIAL DETERMINATION TO BE MADE IN DEVIATION CASES IS WHETHER THE DEVIATION INVOLVED GOES TO THE SUBSTANCE OF THE BID SO AS TO AFFECT EITHER THE PRICE, QUANTITY OR QUALITY OF THE ARTICLES OFFERED, AND THEREFORE WHETHER WAIVER OF THE DEVIATION WOULD BE PREJUDICIAL TO THE RIGHTS OF OTHER BIDDERS, IN THE INSTANT CASE IT IS SPECULATIVE WHETHER ANY PREJUDICIAL ADVANTAGE ACCRUED TO BE CU OVER ANY OTHER BIDDER. WE DO NOT FEEL THAT CANCELLATION OF THE CONTRACT WOULD BE IN THE BEST INTEREST OF THE GOVERNMENT. HOWEVER, IN FUTURE CASES BIDDERS SHOULD NOT BE PERMITTED TO SUPPLEMENT OR CHANGE THEIR BIDS IN MATERIAL RESPECTS AFTER BID OPENING.