B-168666, JAN. 26, 1970

B-168666, JAN. 26, 1970

BID PROTEST--BID BONDS--DEFECTIVE DECISION SUSTAINING PROTEST OF VERN BARNETT CONSTRUCTION CO. AGAINST CANCELLATION OF AWARD BY BLYTHEVILLE AIR FORCE BASE FOR RESURFACING STREETS IN A MILITARY HOUSING AREA. A LOW BID ACCOMPANIED BY A BID BOND DATED 2 DAYS AFTER OPENING WOULD NOT AFFECT ITS ENFORCEABILITY AGAINST THE SURETY SINCE BID DATE BOX ON STANDARD FORM 24 IS ONLY TO IDENTIFY THE BID COVERED BY THE BOND. THEREFORE, THE NOTICE OF CANCELLATION OF THE AWARD ON BASIS OF DEFECTIVE BID BOND MAY BE DISREGARDED.

TO MR. DOUGLAS BRADLEY:

FURTHER REFERENCE IS MADE TO YOUR TELEGRAM OF DECEMBER 19, 1969, AND LETTER OF SAME DATE, PROTESTING ON BEHALF OF VERN BARNETT CONSTRUCTION COMPANY (BARNETT) AGAINST THE CANCELLATION OF A NOTICE OF AWARD OF A CONTRACT TO THAT FIRM UNDER INVITATION FOR BIDS NO. F03601 70-B-0361, ISSUED ON OCTOBER 31, 1969, BY THE BLYTHEVILLE AIR FORCE BASE, ARKANSAS.

THE INSTANT PROCUREMENT SOLICITED BIDS FOR THE RESURFACING OF APPROXIMATELY 20,000 SQUARE YARDS OF ASPHALT STREETS IN THE MILITARY HOUSING AREA OF THE BASE AND CERTAIN OTHER RELATED WORKS.

BIDS WERE OPENED AS SCHEDULED ON DECEMBER 2, 1969, AT 2:00 P.M. CST, AND BARNETT WAS DETERMINED TO BE THE LOW RESPONSIVE AND RESPONSIBLE BIDDER. BY LETTER DATED DECEMBER 4, 1969, THE CONTRACTING OFFICER ADVISED BARNETT THAT "THE ATTACHED CONTRACT" HAD BEEN AWARDED TO IT, AND REQUESTED THAT IT, AND THE REQUIRED PERFORMANCE AND PAYMENT BONDS, BE EXECUTED AND RETURNED. YOUR CLIENT RETURNED THE EXECUTED CONTRACT AND FURNISHED THE BONDS ON DECEMBER 10, 1969. IT IS REPORTED THAT THESE DOCUMENTS WERE RECEIVED AT THE BASE ON DECEMBER 12, 1969.

IT WAS PROVIDED IN THE INVITATION THAT BIDDERS SUBMIT A BID GUARANTEE IN THE SUM OF 20 PERCENT OF THE BID PRICE, TO BE EXECUTED ON STANDARD FORM 24, JUNE 1964 EDITION, A BID BOND FORM PRESCRIBED BY THE GENERAL SERVICES ADMINISTRATION FOR USE IN GOVERNMENT CONTRACTING. ON DECEMBER 12, 1969, IT WAS BROUGHT TO THE CONTRACTING OFFICER'S ATTENTION THAT THE BID BOND SUBMITTED WITH BARNETT'S BID GAVE A BID DATE AND EXECUTION DATE OF DECEMBER 4, 1969, TWO DAYS AFTER BID OPENING. IN ALL OTHER RESPECTS THE BID BOND APPEARS TO HAVE BEEN PROPERLY COMPLETED AND EXECUTED. DECEMBER 15, 1969, THE NOTICE OF CONTRACT AWARD WAS CANCELLED BY THE CONTRACTING OFFICER AND THE BID OF BARNETT WAS REJECTED AS NONRESPONSIVE ON THE GROUND THAT THE BID BOND WAS DEFECTIVE BECAUSE OF THE DATES THEREON. BOTH YOU AND THE BONDING COMPANY CONTEND THAT THE BID BOND WAS INADVERTENTLY DATED DECEMBER 4, 1969, AS A RESULT OF A TYPOGRAPHICAL OR CLERICAL ERROR. YOU ALSO MAINTAIN THAT BY THE TIME THE ERROR WAS DISCOVERED THE CONTRACT HAD BEEN AWARDED AND PERFORMANCE AND PAYMENT BONDS HAD BEEN FURNISHED, AND CONSEQUENTLY THE BID BOND HAD SERVED ITS PURPOSE.

THE ADMINISTRATIVE REPORT FURNISHED OUR OFFICE, BY HEADQUARTERS, U.S. AIR FORCE, WHICH RECOMMENDED THAT THE PROTEST BE SUSTAINED, INDICATES THAT THE CONTRACTING OFFICER'S POSITION, AND THAT OF OTHER BASE PERSONNEL WAS INFLUENCED IN PART BY THEIR INTERPRETATION OF EARLIER DECISIONS OF OUR OFFICE, NAMELY, 38 COMP. GEN. 532 (1959); 39 COMP. GEN. 60 (1959); AND B- 157034, JULY 2, 1965. WHILE THE ADMINISTRATIVE FILE REFLECTS A GOOD FAITH DESIRE BY THE PROCUREMENT PERSONNEL INVOLVED TO MAKE A PROPER AWARD AND THUS TO PROTECT THE INTEGRITY OF THE COMPETITIVE BIDDING SYSTEM, WE CANNOT CONCUR IN THEIR VIEWS AND ACTIONS TAKEN IN THIS MATTER.

THE PURPOSE OF OUR DECISIONS AT 38 COMP. GEN. 532 (1959) AND B-157034, JULY 2, 1965, WAS TO PRECLUDE THE CONSIDERATION FOR AWARD OF A BID WHICH WAS NOT ACCOMPANIED BY A VALID BID BOND IN THE AMOUNT REQUIRED, UPON WHICH THE GOVERNMENT WOULD HAVE RECOURSE AGAINST THE SURETY IN THE EVENT THE BIDDER FAILED TO PROCEED WITH FULL PERFORMANCE OF THE CONTRACT IF AWARDED TO IT. IN 39 COMP. GEN. 60 (1959) WE HAD OCCASION TO REVIEW WHAT EFFECT A PRE-DATED BID BOND HAD ON THE RESPONSIVENESS OF THE BID. THERE WE STATED AT PAGE 62:

"MORE SPECIFICALLY TO THE POINT IT HAS BEEN HELD THAT A BOND WHICH IS ERRONEOUSLY DATED OR BEARS NO DATE AT ALL IS NOT THEREBY RENDERED INVALID IF IT COMPLIES WITH THE OTHER ESSENTIALS NECESSARY TO GIVE IT A LEGAL AND BINDING EFFECT. IN RE MOFFITT'S ESTATE, 75 A. 2D. 698

IN B-159209, JUNE 23, 1966, AND B-160659, JUNE 9, 1967, WE AGAIN HAD OCCASION TO CONSIDER THE EFFECT OF AN ERRONEOUSLY DATED, OR UNDATED, BID BOND. IN EACH CASE THE ARGUMENT WAS ADVANCED THAT SUCH DEFECTS RENDERED THE BID NONRESPONSIVE. CONSISTENT WITH OUR HOLDING IN 39 COMP. GEN. 60 (1959), WE HELD THAT FULL IDENTIFICATION OF THE BOND WITH THE BID, BY THE PROPER IFB NUMBER AND OTHER INFORMATION, WERE SUFFICIENT TO ELIMINATE ANY QUESTION AS TO WHAT THE BOND COVERED, AND THAT NOTWITHSTANDING THE INADVERTENT DATE OR NO DATE, THE BOND WAS ENFORCEABLE AND THE BID WAS RESPONSIVE.

IN THE PRESENT CASE, AND IN ALL OTHERS IN WHICH STANDARD FORM 24 IS USED, THE PURPOSE OF THE BOX "BID DATE" IS ONLY TO IDENTIFY THE BID COVERED BY THE BOND. IT DOES NOT REPRESENT THE COMMENCEMENT OF THE TIME LIMITATION FOR WHICH THE SURETY MAY BE LIABLE UNDER THE BOND. THE BOND AND THE BID MUST BE CONSIDERED TOGETHER, AND THE EFFECTIVE DATE OF THE SURETY'S LIABILITY WOULD NOT BEGIN UNTIL THE ACCEPTANCE OF THE BID BY THE GOVERNMENT, WHICH IN THIS CASE WAS ON DECEMBER 4, 1969, THE DATE INSERTED IN THE BID BOND. IN THIS REGARD, IT IS NOTED THAT THE DATE OF THE BID IS DECEMBER 2, 1969, THE DATE SET FOR OPENING, AND SINCE THE BOND WAS WITH THE BID WHEN IT WAS OPENED ON THAT DATE IT WOULD HAVE BEEN IMPOSSIBLE FOR THE BOND TO HAVE BEEN EXECUTED LATER THAN DECEMBER 2.

THEREFORE, IT DOES NOT APPEAR THAT THERE COULD ARISE ANY CONFUSION AS TO THE BID COVERED BY THE BOND, NOR DO WE BELIEVE THAT THE DISCREPANCY IN DATE WOULD AFFECT ITS ENFORCEABILITY BY THE GOVERNMENT AGAINST THE SURETY. YOUR PROTEST IS THEREFORE SUSTAINED, AND WE ARE BY SEPARATE LETTER ADVISING THE DEPARTMENT OF THE AIR FORCE THAT AWARD OF CONTRACT WAS PROPERLY MADE TO YOUR CLIENT, AND THAT THE PURPORTED NOTICE OF CANCELLATION THEREOF MAY BE DISREGARDED.