B-167098, DEC. 30, 1969

B-167098, DEC. 30, 1969

REQUIREMENTS--DELIVERY PROVISIONS CONTENTION THAT CONSIDERING COMMERCIAL PRACTICE, WHERE LOW BIDDER OFFERS TO SUPPLY QUANTITY OF AMMUNITION 20 DAYS "AFTER RECEIPT OF ORDER," QUANTITY LIMITATION DOES NOT APPLY TO EACH OFFER BUT TO AGGREGATE OF ORDERS ISSUED UNDER CONTRACT THUS MAKING BID NONRESPONSIVE, CANNOT BE CONCURRED IN SINCE IN DETERMINING WHETHER BID CONFORMS TO TERMS OF ADVERTISED SOLICITATION, RESPONSIVENESS MUST BE DETERMINED SOLELY FROM FACE OF BID ITSELF AND THERE IS NO LANGUAGE IMPLYING QUANTITY LIMITATION APPLIES TO AGGREGATE OF ORDERS. FURTHERMORE, LOW BIDDER'S DELIVERY SCHEDULE OFFERS DEFINITE TIME PERIOD FOR DELIVERY OF ANY QUANTITY ORDERED UNDER CONTRACT AND DOES NOT CONFLICT WITH ANY TERMS OF SOLICITATION; CONSEQUENTLY, CONTRACT AWARDED ANOTHER BIDDER SHOULD BE CANCELED.

TO REMINGTON ARMS COMPANY, INC.:

REFERENCE IS MADE TO YOUR TELEGRAM DATED NOVEMBER 12, 1969, AND SUBSEQUENT CORRESPONDENCE IN WHICH YOU REQUEST RECONSIDERATION OF OUR DECISION DATED NOVEMBER 7, 1969, (B-167098). PURSUANT TO THE CONCLUSIONS SET FORTH THEREIN WE DIRECTED CANCELLATION OF THE CONTRACT AWARDED TO YOUR COMPANY BY THE DEPARTMENT OF JUSTICE UNDER SOLICITATION NO. 7584 WHICH WAS FOR AN ESTIMATED ANNUAL REQUIREMENT OF 11,060,850 ROUNDS OF .38 CALIBER SPECIAL, MIDRANGE OR WADCUTTER, 148 GRAIN, LEAD OR LUBALOY COATED, AMMUNITION.

PARAGRAPH 1 OF THE SPECIAL CONDITIONS OF THE INVITATION PROVIDED AS FOLLOWS:

"SCOPE OF CONTRACT: THIS CONTRACT PROVIDES FOR THE NORMAL SUPPLY REQUIREMENTS OF AMMUNITION FOR THE DEPARTMENT OF JUSTICE DURING THE CONTRACT PERIOD. THE QUANTITIES SHOWN REPRESENT THE ESTIMATED REQUIREMENT FOR EACH ITEM DURING THE CONTRACT PERIOD, BUT SHALL NOT BE CONSTRUED TO REPRESENT ANY AMOUNT WHICH THE GOVERNMENT SHALL BE OBLIGATED TO ORDER UNDER THE CONTRACT. HOWEVER, THE DEPARTMENT OF JUSTICE IS OBLIGATED TO ORDER HEREUNDER SUCH QUANTITIES AS MAY BE NEEDED FROM TIME TO TIME TO FILL ANY DEPARTMENT OF JUSTICE REQUIREMENTS. THE CONTRACTOR IS OBLIGATED TO DELIVER HEREUNDER ALL SUCH QUANTITIES AS MAY BE ORDERED FROM TIME TO TIME. THE ESTIMATED QUANTITIES SHOWN ARE FOR INFORMATIONAL PURPOSES ONLY, AND SHALL NOT RELIEVE THE CONTRACTOR OF HIS OBLIGATIONS TO FILL ALL ORDERS WHICH MAY BE PLACED HEREUNDER."

PARAGRAPH 6 OF THE SPECIAL CONDITIONS PROVIDED AS FOLLOWS:

"TIME OF DELIVERY: THE GOVERNMENT DESIRES THAT DELIVERIES BE MADE TO THE DESTINATIONS WITHIN 20 CALENDAR DAYS AFTER RECEIPT OF ORDER.

"A. BIDDER SHALL INSERT IN THE APPROPRIATE BLANK BELOW A DEFINITE NUMBER OF DAYS WITHIN WHICH THE MERCHANDISE WILL BE DELIVERED AFTER RECEIPT OF PURCHASE ORDER.

"B. BIDDER'S PROPOSED TIME OF DELIVERY: ------ CALENDAR DAYS AFTER RECEIPT OF ORDER.

"C. IF THE BIDDER DOES NOT INSERT A SPECIFIC NUMBER OF DAYS, HIS BID SHALL BE DEEMED TO OFFER DELIVERY IN ACCORDANCE WITH THE DELIVERY TIME AS ESTABLISHED BY THE GOVERNMENT."

OLIN MATHIESON CHEMICAL CORPORATION QUOTED A PRICE OF $45.83 PER THOUSAND, WITH DELIVERY STIPULATED AS FOLLOWS:

"ITEM NO. 1

5,000,000 RDS. 20 DAYS AFTER RECEIPT OF ORDER.

1,000,000 RDS. EACH 30 DAYS THEREAFTER."

THE JUSTICE DEPARTMENT AND YOUR COMPANY CONSIDERED THAT THE BID OF THE OLIN MATHIESON CHEMICAL CORPORATION (HEREAFTER REFERRED TO AS OLIN) WAS NONRESPONSIVE BECAUSE IT LIMITED THE QUANTITY OF AMMUNITION WHICH COULD BE ORDERED AT A GIVEN TIME. WE COULD NOT CONCUR WITH THIS JUDGMENT BECAUSE IT WAS OUR OPINION THAT THE DEPARTMENT COULD ORDER ANY QUANTITY OF AMMUNITION AT ANY GIVEN TIME AND THE CORPORATION WOULD STILL BE REQUIRED TO DELIVER UNDER EACH ORDER IN ACCORDANCE WITH ITS DELIVERY SCHEDULE, WHICH WAS NOT IN CONFLICT WITH THE DELIVERY SCHEDULE PROVISIONS OF THE INVITATION. IN THIS REGARD THE SOLICITATION FAILED TO STATE A MAXIMUM ACCEPTABLE DELIVERY TIME AND THERE WAS NO EVIDENCE IN THE RECORD INDICATING THAT OLIN'S OFFER TO SUPPLY 5 MILLION ROUNDS UNDER EACH ORDER WAS UNREASONABLE CONSIDERING THAT THE TOTAL ESTIMATED YEARLY REQUIREMENT FOR THE SIX ORDERING ACTIVITIES WAS ONLY SLIGHTLY OVER 11 MILLION ROUNDS. ACCORDINGLY, WE CONCLUDED THAT OLIN SHOULD HAVE RECEIVED AN AWARD FOR THIS REQUIREMENT AND DIRECTED CANCELLATION OF YOUR CONTRACT.

YOU NOW SUGGEST THAT OLIN'S OFFER TO SUPPLY 5 MILLION ROUNDS 20 DAYS "AFTER RECEIPT OF ORDER" DID NOT APPLY TO EACH OFFER AS WE CONCLUDED, BUT THAT SUCH QUANTITY LIMITATION APPLIED TO THE AGGREGATE OF THE ORDERS ISSUED UNDER THE CONTRACT. ACCORDING TO YOUR INTERPRETATION THIS LIMITATION MADE DELIVERY CONTINGENT UPON THE QUANTITY OF MERCHANDISE PREVIOUSLY ORDERED THEREBY MAKING THE TIME OF DELIVERY UNCERTAIN. YOUR INTERPRETATION OF OLIN'S BIDDING SCHEDULE IS BASED ON AN ANALYSIS OF COMMERCIAL PRACTICES WITHIN THE AMMUNITION INDUSTRY, WHICH ALLEGEDLY DEMONSTRATE THAT A LIMITATION ON COMMITMENTS FOR THE DELIVERY OF AGGREGATE QUANTITIES WOULD BE OF BENEFIT TO THE BIDDER, BUT A LIMITATION ON COMMITMENTS FOR DELIVERIES UNDER EACH ORDER WOULD BE USELESS. YOU STATE THAT THIS CONCLUSION WOULD ALSO FOLLOW FROM AN EXAMINATION OF COMMERCIAL PRACTICES IN ANY OTHER BUSINESS. IN VIEW OF THIS ANALYSIS YOU CONTEND THAT OLIN'S SCHEDULE MUST BE READ AND INTERPRETED IN THE LIGHT OF SUCH COMMERCIAL PRACTICE AND, SO READ, OLIN'S SCHEDULE WAS NONRESPONSIVE TO THE SOLICITATION PROVISION WHICH REQUIRED BIDDERS TO INDICATE A "DEFINITE NUMBER OF DAYS WITHIN WHICH THE MERCHANDISE WILL BE DELIVERED AFTER RECEIPT OF PURCHASE ORDER."

AS AUTHORITY FOR THE PROPOSITION THAT WE SHOULD CONSIDER COMMERCIAL PRACTICE IN DETERMINING THE RESPONSIVENESS OF OLIN'S BID YOU CITE CERTAIN AUTHORITIES WHICH ARE CONCERNED WITH THE INTERPRETATION OF PROVISIONS OF AN EXECUTED CONTRACT. HOWEVER, IN DETERMINING WHETHER A BID CONFORMS TO THE TERMS OF AN ADVERTISED SOLICITATION OUR OFFICE HAS CONSISTENTLY MAINTAINED THAT THE RESPONSIVENESS OF A BID IS TO BE DETERMINED SOLELY FROM THE FACE OF THE BID ITSELF. B-161576, JULY 13, 1967; 45 COMP. GEN. 221 (1965). THE OBVIOUS PURPOSE OF THIS RULE IS TO PREVENT A BIDDER FROM BEING ABLE TO ADVANCE THE INTERPRETATION OF HIS OFFER, OR OF ANY OTHER BIDDER'S OFFER, WHICH IS BEST SUITED TO HIS INTERESTS AFTER BIDS ARE OPENED AND COMPETITIVE POSITIONS HAVE BEEN REVEALED. IN VIEW THEREOF, IT IS OUR OPINION THAT THE RESPONSIVENESS OF OLIN'S BID MUST BE DETERMINED FROM THE BID ITSELF, AND WE MUST THEREFORE DECLINE TO CONSIDER WHAT YOU HAVE ALLEGED TO BE THE COMMERCIAL PRACTICE OF THE AMMUNITION INDUSTRY IN DETERMINING THE RESPONSIVENESS OF OLIN'S BID.

YOU ALSO SUGGEST THAT OLIN'S DELIVERY SCHEDULE IS AMBIGUOUS BECAUSE ITS OFFER TO DELIVER "5,000,000 ROUNDS 20 DAYS AFTER RECEIPT OF ORDER" IS CAPABLE OF TWO EQUALLY PLAUSIBLE INTERPRETATIONS: (1) 5,000,000 ROUNDS OF THE TOTAL AMOUNT ORDERED UNDER EACH ORDER WILL BE DELIVERED WITHIN 20 DAYS AFTER RECEIPT OF ORDER; (2) 5,000,000 ROUNDS OF THE TOTAL AMOUNT ORDERED UNDER THE CONTRACT WILL BE DELIVERED WITHIN 20 DAYS AFTER RECEIPT OF ORDER. WE CANNOT CONCUR WITH THIS INTERPRETATION. THERE IS NO LANGUAGE IN THE BID WHICH IMPLIES THAT THE QUANTITY LIMITATION OF 5,000,000 ROUNDS IS TO APPLY TO THE AGGREGATE OF ORDERS ISSUED UNDER THE CONTRACT. CONVERSELY, SINCE PARAGRAPH 6 OF THE SPECIAL CONDITIONS ASKS BIDDER TO SPECIFY DELIVERIES WITHIN A STATED NUMBER OF DAYS "AFTER RECEIPT OF ORDER," IT IS OUR OPINION THE BID, IN ADOPTING THE PHRASE "AFTER RECEIPT OF ORDER," CLEARLY INDICATES THAT THE 5 MILLION ROUND LIMITATION APPLIES TO EACH ORDER. IN VIEW THEREOF WE BELIEVE OLIN'S DELIVERY SCHEDULE OFFERS A DEFINITE TIME PERIOD FOR DELIVERY OF ANY QUANTITY OF AMMUNITION ORDERED UNDER THE CONTRACT, AND CANNOT BE CONSIDERED IN CONFLICT WITH ANY TERMS OF THE SOLICITATION.

YOU FURTHER ALLEGE THAT CANCELLATION OF YOUR CONTRACT AND AN AWARD TO OLIN WOULD SERIOUSLY DISRUPT THE ADMINISTRATIVE PROCEDURES ENTAILED IN ORDERING THE AMMUNITION WITHIN THE DEPARTMENT. IN THIS REGARD WE HAVE NOT BEEN ADVISED BY THE PROCURING OFFICIALS OF ANY DIFFICULTIES OF THIS NATURE, NOR DO WE BELIEVE THAT SUCH A FACTOR WOULD BE LEGALLY SUFFICIENT UNDER THE REQUIREMENTS OF THE PROCUREMENT LAWS AND REGULATIONS TO PRECLUDE CANCELLATION OF YOUR CONTRACT.

FOR THE REASONS SET FORTH ABOVE, WE MUST REAFFIRM THE CONCLUSIONS SET FORTH IN OUR DECISION OF NOVEMBER 7, 1969.