B-164741, JUL. 19, 1968

B-164741, JUL. 19, 1968

TO CHALCO ENGINEERING CORPORATION:

WE REFER TO YOUR LETTER DATED MAY 29, 1968, ADDRESSED TO THE COMPTROLLER OF THE AIR FORCE FORWARDING A COPY OF YOUR PROTEST TO THE CONTRACTING OFFICER AGAINST THE AWARD OF A CONTRACT UNDER SOLICITATION NO. F04697-68-B -0025 ISSUED FOR THE OPERATION OF A CLEANING FACILITY AT VANDENBERG AIR FORCE BASE, CALIFORNIA. YOUR PROTEST AND A REPORT THEREON WAS SENT TO THIS OFFICE BY THE DEPARTMENT OF THE AIR FORCE ON JUNE 28, 1968.

THE ABOVE SOLICITATION WAS A TWO-STEP FORMALLY ADVERTISED PROCUREMENT FOR OPERATION DURING THE FISCAL YEAR 1969 OF A GOVERNMENT OWNED CHEMICAL CLEANING FACILITY. ITEM 4 OF THE INVITATION AS AMENDED, READS AS FOLLOWS: "ITEM 4: TOTAL ANNUAL DATA REQUIREMENTS IN ACCORDANCE WITH DD FORM 1423 (CONTRACT DATA REQUIREMENTS LIST) EXHIBIT -A- ATTACHED. (CONTRACTOR IS ALSO REQUESTED TO COMPLETE 25 AND 26 OF THE FORM). $--------.' CHALCO INSERTED $800.76 IN THE BLANK SPACE. BIDS WERE OPENED ON MAY 23, 1968, AND CHALCO'S BID WAS $8.76 HIGHER THAN THE LOWEST BID. ON MAY 24, 1968, AWARD WAS MADE TO THE LOW BIDDER AND LATER THE SAME AFTERNOON CHALCO WIRED THE CONTRACTING OFFICER THAT THE PRICE SUBMITTED FOR ITEM 4 SHOULD HAVE BEEN $0.00 INASMUCH AS THE COST OF THE DATA COVERED BY THE ITEM WAS INCLUDED IN HIS BID ON ITEM 1. CHALCO CONTENDED THIS ALLEGATION WAS SUBSTANTIATED BY THE INFORMATION SUPPLIED ON THE DD FORM 1423 WHICH WAS PART OF THE BID AND SHOWED THE ESTIMATED MAN-HOURS AND DOLLARS FOR THE INDIVIDUALS INVOLVED IN PREPARING THE DATA UNDER ITEM 4. THESE INDIVIDUALS WERE SHOWN IN STEP 1 OF THE ADVERTISEMENT, THE TECHNICAL PROPOSAL, AS PART OF THE PERMANENT LABOR FORCE AND WERE THEREFORE NECESSARILY COVERED IN THE PRICE OF ITEM 1 ACCORDING TO CHALCO, AND THE COST OF DATA, ITEM 4 OF THE UNIT PRICE SCHEDULE, SHOULD NOT HAVE BEEN INCLUDED IN THE COMPUTATION FOR DETERMINING THE LOW BID. IN SUPPORT OF THIS POSITION THE INSTRUCTIONS ON THE REVERSE SIDE OF DD FORM 1423,"CONTRACT DATA REQUIREMENTS LIST," AND ARMED SERVICES PROCUREMENT REGULATION 2-407.5 (B) AND 16-815 WERE CITED.

ASPR 2-407.5 (B) PROVIDES THAT ESTIMATED PRICES SUBMITTED ON DD FORM 1423 SHALL NOT BE CONSIDERED IN EVALUATING BIDS. THIS PROVISION RELATES TO THOSE ESTIMATES MADE ON THAT FORM, NOT A PRICE SUBMITTED FOR DATA UNDER A SEPARATE ITEM OF THE INVITATION. FURTHER, THIS INVITATION WAS ISSUED ON MAY 6, 1968, SUBSEQUENT TO THE ISSUANCE OF DEFENSE PROCUREMENT CIRCULAR NUMBER 60, APRIL 1, 1968, WHICH DELETED THE ABOVE SECTION OF ASPR PURSUANT TO THE AUTHORITY OF 10 U.S.C. 2202 AND ASPR 1-106.2. ASPR 16-815 AND PARAGRAPH 3,"FOR THE CONTRACTOR," OF THE REVERSE SIDE OF DD FORM 1423 PROVIDE THAT THE FORM SHALL BE USED FOR OBTAINING ESTIMATED PRICES OF DATA FOR DETERMINING THE ATTRIBUTABLE PROTION OF THE TOTAL CONTRACT PRICE AND THAT THE ESTIMATED PRICES FILLED IN IN ITEM 26 OF THE FORM WILL NOT BE USED SEPARATELY IN EVALUATION OF BIDS OR OFFERS. WE DO NOT PERCEIVE ANY PROHIBITION IN THE INSTRUCTIONS ON THE DD FORM 1423 OR IN ASPR 16-815 WHICH FORBIDS SETTING OUT AS A SEPARATE ITEM IN THE INVITATION FOR BIDS THE TOTAL ANNUAL DATA REQUIREMENTS NOR DO WE FIND A POSITIVE REQUIREMENT IN THOSE TERMS THAT WHEN DATA IS REQUIRED THE COST OR BID PRICE THEREFORE MUST BE INCLUDED OR COUPLED WITH A BID ON SOME OTHER ITEM. RATHER, IT IS INTENDED THAT THE ESTIMATED PRICES SET OUT ON DD FORM 1423 WILL NOT BE USED IN AND BY THEMSELVES, IN EVALUATING BIDS UNLESS THE PRICE IS SET FORTH, AS HERE, AS AN ITEM IN THE SCHEDULE PURSUANT TO ASPR 2-201 (A) XI. THAT SUCH ESTIMATES WILL FORM THE BASIS FOR THE BID ON DATA REQUIREMENTS, WHETHER SET FORTH IN A SEPARATE ITEM OR COMBINED WITH OTHER REQUIREMENTS, IS CLEARLY EVIDENT. AMENDMENT NUMBER 1 TO THE INVITATION, WHICH CHALCO ACKNOWLEDGED ON MAY 13, 1968, PROVIDED IN PART: "A. PART I

"C. ADD THE FOLLOWING NOTE AFTER ITEM 4: -NOTE: * * * FOR THE PURPOSES OF BID EVALUATION AND DETERMINATION OF ITS LOW OFFER, THE MONTHLY FIGURES FOR ITEMS 1 AND 2 WILL BE MULTIPLIED BY 12 MONTHS AND ADDED TO ITEM 4.-" IN VIEW OF THIS EXPRESS LANGUAGE WE CAN FIND NO BASIS TO CONCLUDE THAT THIS INVITATION FOR BIDS WAS AMBIGUOUS SO AS TO MISLEAD CHALCO AS TO THE BASIS FOR UNIT PRICE BID OR EVALUATION OF THE TOTAL BIDS.

BY LETTER OF MAY 27, 1968, CHALCO ALSO REQUESTED THE FIGURE OF $800.76 IN ITEM 4 BE CORRECTED TO READ $66.73 AS THE FORMER AMOUNT WAS AN OBVIOUS ERROR AND THE LATTER AMOUNT WAS THAT WHICH APPEARED ON DD FORM 1423. THIS MISTAKE WAS ALLEGED TO HAVE RESULTED FROM THE ERRONEOUS MULTIPLICATION OF $66.73 BY TWELVE (MONTHS) TO ARRIVE AT $800.76 WHEN IN FACT THE AMOUNT OF $66.73 WAS THE TOTAL ANNUAL AMOUNT.

THE SHORT ANSWER TO YOUR PROTEST IS SIMPLY THAT YOU WERE NOT THE LOW BIDDER ON THE BASIS OF YOUR BID AS MADE, AND THAT A CONTRACT WAS AWARDED TO THE LOW BIDDER BEFORE ANY ALLEGATION OF ERROR IN YOUR BID HAD BEEN MADE. IN SUCH CIRCUMSTANCES IT IS REALLY IMMATERIAL WHETHER YOU DID OR DID NOT MAKE A MISTAKE IN YOUR BID. A VALID AND BINDING CONTRACT HAD ALREADY BEEN MADE WITH SOMEONE ELSE AND YOUR MISTAKE AFFORDS NO LEGAL BASIS FOR CANCELLATION OF THAT CONTRACT. HOWEVER, IN VIEW OF YOUR CONCERN OVER THE SPEED WITH WHICH AWARD WAS MADE, WE HAVE REVIEWED THE CASE AS IF AWARD HAD NOT BEEN MADE.

WHEN A MISTAKE HAS BEEN ALLEGED BEFORE AWARD OF A CONTRACT TO ANOTHER BIDDER, OUR OFFICE HAS PERMITTED CORRECTION IF CLEAR AND CONVINCING EVIDENCE IS PRESENTED (1) THAT A MISTAKE WAS MADE, (2) AS TO THE NATURE OF THE MISTAKE, (3) HOW IT WAS MADE, AND (4) WHAT THE BID WOULD HAVE BEEN EXCEPT FOR THE ERROR. SEE 37 COMP. GEN. 210. FURTHER, WHEN CORRECTION WILL DISPLACE ANOTHER BIDDER, THIS EVIDENCE MUST BE FOUND IN THE INVITATION AND BID DOCUMENTS, NOT BY THE AID OF EXTRINSIC EVIDENCE SUPPLIED BY THE BIDDER. SEE ARMED SERVICES PROCUREMENT REGULATION 2-406.3 (A) (3). IN THE PRESENT INSTANCE THE EVIDENCE THAT A MISTAKE WAS MADE AND WHAT THE INTENDED BID WAS IS NOT CLEAR ON THE FACE OF THE BID. DD FORM 1423 ESTIMATED DATA PRICE $66.73 WHICH WAS REFERRED TO AS EVIDENCE OF THE INTENDED BID WAS NOT CONSIDERED INCONSISTENT WITH THE AMOUNT, TWELVE TIMES GREATER, INSERTED FOR ITEM 4 SINCE THE OTHER FIGURES ON FORM 1423 WERE COMPUTED ON A MONTHLY BASIS. THIS OFFICE WAS ALSO ADVISED THAT THE PRICE SUBMITTED, $800.76, WAS NOT SIGNIFICANTLY DIFFERENT FROM THAT SUBMITTED BY ANOTHER BIDDER. FURTHER, THE TYPED INSERTION ON THE FACE OF THE BID AT ITEM 4 BY CHALCO OF THE WORDS "TOTAL ANNUAL" DOES NOT PRESENT CLEAR EVIDENCE ON THE FACE OF THE BID THAT THE FIGURE $66.73 WAS ERRONEOUSLY MULTIPLIED BY TWELVE.

FOR THE ABOVE REASONS WE MUST CONCLUDE THAT ADMINISTRATIVE CORRECTION OF CHALCO'S BID, EVEN IF AWARD HAD NOT BEEN MADE, RESULTING IN DISPLACEMENT OF A LOWER BIDDER WOULD HAVE BEEN IMPROPER. SEE 17 COMP. GEN. 554, 558.