B-174581, FEB 28, 1972

B-174581, FEB 28, 1972

BID PROTEST - CANCELLATION - NONRESPONSIVENESS - AMBIGUOUS SOLICITATION DECISION DENYING PROTEST OF SANDNES' SONS, INC., AGAINST THE CANCELLATION OF AN IFB AND THE AWARD OF A CONTRACT TO JACK RUBIN AND SONS, INC., UNDER AN RFP ISSUED BY THE DEFENSE INDUSTRIAL SUPPLY CENTER, PHILADELPHIA, PA. BOTH SOLICITATIONS WERE TOTAL SMALL BUSINESS SET-ASIDES FOR WIRE ROPE ASSEMBLIES. ABSENT A CLEAR ABUSE OF DISCRETIONARY POWER, THE COMP. GEN. WOULD NOT BE JUSTIFIED IN OBJECTING TO THE CONTRACTING OFFICER'S DETERMINATION. 171965, MAY 20, 1971. SINCE THE SUBJECT SOLICITATIONS DO APPEAR AMBIGUOUS, THE CONTRACTING OFFICER'S DECISION TO CANCEL WAS PROPERLY WITHIN HIS AUTHORITY UNDER SECTION 2-404.1(B)(I) ASPR. WITH REGARD TO THE AWARD TO RUBIN, ALTHOUGH THE RFP WAS AMBIGUOUS THE CONTRACTOR'S INTERPRETATION OF IT WAS NOT UNREASONABLE. FURTHER, NO OBJECTION CONCERNING THE REQUIREMENTS OF THE SPECIFICATION WAS RAISED UNTIL AFTER PERFORMANCE HAD COMMENCED. SINCE THE NEED FOR THE ASSEMBLIES WAS CONSIDERED TO BE OF UNUSUAL URGENCY, AND SINCE THE PROPOSED MODIFICATION WOULD NOT INCREASE THE CONTRACT PRICE ABOVE THAT OF THE NEXT OFFEROR, THE COMP. GEN. IS UNABLE TO CONCLUDE THAT THE DECISION TO NEGOTIATE THE MODIFICATION INSTEAD OF CANCELLING RUBIN'S CONTRACT WAS CLEARLY UNWARRANTED. IN ANY EVENT, COMPLETION OF THE CONTRACT AT THIS TIME PRECLUDES ANY EFFECTIVE RELIEF BY GAO. ACCORDINGLY, THE PROTEST MUST BE DENIED.

TO SANDNES' SONS, INC.:

REFERENCE IS MADE TO YOUR TELEFAX DATED NOVEMBER 18, 1971, AND YOUR LETTER OF NOVEMBER 30, 1971, WITH ENCLOSURES, PROTESTING THE CANCELLATION OF INVITATION FOR BIDS (IFB) DSA500-72-B-0091 (HEREAFTER 0091), AND THE AWARD OF A CONTRACT TO ANOTHER OFFEROR UNDER REQUEST FOR PROPOSAL (RFP) DSA500-72-R-0028 (HEREAFTER 0028), ISSUED BY THE DEFENSE INDUSTRIAL SUPPLY CENTER, PHILADELPHIA, PENNSYLVANIA.

BOTH OF THE ABOVE SOLICITATIONS WERE ISSUED ON JULY 13, 1971, FOR THE SAME ITEM, WIRE ROPE ASSEMBLY, SINGLE LEG STEEL, FSN4010-289-9309. BOTH SOLICITATIONS WERE 100 PERCENT SMALL BUSINESS SET-ASIDES. RFP 0028 WAS NEGOTIATED UNDER AUTHORITY OF 10 U.S.C. 2304(A)(2) FOR DIRECT DELIVERY TO MARINE CORPS SUPPLY CENTER, ALBANY, GEORGIA, OF 98 UNITS HAVING AN ASSIGNED ISSUE PRIORITY DESIGNATOR OF 06 UNDER THE UNIFORM MATERIEL MOVEMENT AND ISSUE PRIORITY SYSTEM (UMMIPS). OFFERS UNDER RFP 0028 WERE RECEIVED UNTIL JULY 26, 1971, BY WHICH TIME THE FOLLOWING FIVE PROPOSALS HAD BEEN RECEIVED:

UNIT PRICE

OFFEROR FOB ORIGINFOB DESTINATION

JACK RUBIN & SONS, INC. $198.50

SANDNES' SONS, INC. $227.00 239.00

CONTINENTAL CABLE CO. 254.32

THE HOLLOWAY CO. 276.00 288.00

CARPENTER RIGGING &

SUPPLY CO., INC. 310.00 333.00

BIDS UNDER IFB-0091 WERE OPENED ON JULY 28, 1971. THIS SOLICITATION WAS FOR THE DELIVERY FOB DESTINATION OF 93 UNITS, 63 TO DEFENSE DEPOT, MEMPHIS, TENNESSEE, AND THE REMAINDER TO DEFENSE DEPOT, OGDEN, UTAH. THE FOLLOWING SEVEN BIDS WERE RECEIVED IN RESPONSE TO THE INVITATION:

UNIT PRICE

BIDDER DD MEMPHIS DD OGDEN

JACK RUBIN & SONS, INC. $198.50 $198.50

SANDNES' SONS, INC. 232.00 237.00

CONTINENTAL CABLE CO. 262.61 262.61

THE HOLLOWAY CO. 288.00 288.00

DURAND MACHINERY, INC. 294.00 294.00

CARPENTER RIGGING & SUPPLY CO., INC. 330.00 325.00

SYSTEMS AND COMPONENTS 900.00 900.00

ON AUGUST 30, 1971, JACK RUBIN & SONS, INC. (RUBIN), WAS AWARDED CONTRACT NO. DSA500-72-C-1113 UNDER RFP-0028 WITHOUT FURTHER NEGOTIATION, AT A UNIT PRICE OF $198.50.

AT A MEETING ON SEPTEMBER 9, 1971, BETWEEN MESSRS. SIDNEY AND ARNOLD SANDNES, OF YOUR FIRM, AND THE CONTRACTING OFFICER AND CERTAIN OTHER PERSONNEL OF THE PROCURING ACTIVITY, YOU ALLEGED THAT RUBIN INTENDED TO FURNISH A STRAIGHT PIN AS PART OF THE SOCKETS FOR THE WIRE ROPE ASSEMBLY AS OPPOSED TO THE NUT AND BOLT REQUIRED BY THE SPECIFICATIONS. CONSEQUENTLY, YOU STATED THAT AWARD SHOULD BE MADE TO YOUR FIRM UNDER IFB- 0091 AS THE LOW, RESPONSIVE, RESPONSIBLE BIDDER. AT THAT MEETING YOU DID NOT OBJECT TO THE AWARD TO RUBIN UNDER RFP 0028.

THE FOLLOWING SPECIFICATION WAS USED IN BOTH RFP-0028 AND IFB-0091:

WIRE ROPE ASSEMBLY, SINGLE LEG

STEEL

THE FOLLOWING BUREAU OF SHIP DRAWING NUMBERS ARE APPLICABLE:

1203960, ALT 2 OF 18 DEC 53

1755750 OF 2 MAY 57 WITH REVISION A OF 5 FEB 62

1755751 OF 2 MAY 57 WITH REVISION F OF 5 FEB 62

1755752 OF 2 MAY 57 WITH REVISION C OF 5 FEB 62

1756346 OF 1 MAY 57 WITH REVISION B OF 2 APR 65

DRAWING 1203960 SHOWS THE COMPLETE WIRE ROPE ASSEMBLY WITHOUT DIMENSIONS AND ASSOCIATES EACH COMPONENT WITH A SEPARATE DRAWING NUMBER. THE DIMENSIONS ARE CONTAINED IN THE DRAWINGS FOR THE INDIVIDUAL COMPONENTS WHICH GIVE THE ESSENTIAL INFORMATION AND GREATER DETAIL. DRAWING 1203960 ALSO SHOWS THE SOCKETS WITH A BOLT FOR WHICH DRAWING NUMBER 1204611 IS DESIGNATED, A NUT FOR WHICH DRAWING NUMBER 1204612 IS DESIGNATED, AND A COTTER PIN HAVING DRAWING NUMBER 590210 BUT, AS SHOWN ABOVE, THESE NUMBERS ARE NOT SET FORTH IN THE SPECIFICATION'S LIST OF APPLICABLE DRAWINGS. ISSUE IS RAISED REGARDING NUMBERS 1755750, 1755751, AND 1756346 RELATING TO THE WIRE ROPE, LINK CHAIN, AND HOOK-HOIST COMPONENT OF THE ASSEMBLY. HOWEVER, DRAWING 1755752 RELATING TO THE SOCKET COMPONENT OF THE ASSEMBLY SHOWS THE SOCKET WITH A STRAIGHT PIN RATHER THAN A BOLT AND NUT. THIS DRAWING INCLUDES THE FOLLOWING STATEMENT:

"SOCKET TO CONFORM TO FED. SPEC RR-S-550 1 1/2 WIRE ROPE SIZE TYPE A, FINISH 2"

PARAGRAPH 1.2.1 OF FEDERAL SPECIFICATION RR-S-550 DEFINES TYPE A AS "OPEN SOCKETS" AND FINISH 2 AS "ZINC COATED". PARAGRAPH 3.3.1.2 OF THE SPECIFICATION STATES, IN PART, AS FOLLOWS:

"ALL OPEN WIRE ROPE SOCKETS SHALL BE SUPPLIED WITH PINS. THE CONSTRUCTION OF THE PINS SHALL BE OF THE MANUFACTURER'S STANDARD COMMERCIAL TYPE."

FEDERAL SPECIFICATION RR-S-550 ALSO DEPICTS THE SOCKET WITH A PIN AND INCLUDES DIMENSIONS FOR THE PIN AND THE COTTER PIN REQUIRED TO HOLD THE PIN IN PLACE IN THE SOCKET. AS PREVIOUSLY POINTED OUT DRAWING NUMBER 1755752, SHOWING THE STRAIGHT PIN, IS SPECIFICALLY LISTED IN THE SPECIFICATION AS AN APPLICABLE DRAWING, WHEREAS THE DRAWINGS SHOWING AN EYE BOLT AND NUT ARE NOT SPECIFICALLY LISTED BUT ARE SHOWN ONLY IN DRAWING 1203960.

WE ARE ADVISED THAT SUBSEQUENT TO THE SEPTEMBER 9 MEETING THE CONTRACTING OFFICER WAS ADVISED BY THE DIRECTORATE OF TECHNICAL OPERATIONS THAT IT HAD BEEN THE INTENT OF THE TECHNICIAN, WHO PREPARED THE SPECIFICATION USED IN RFP-0028 AND IFB-0091, TO SUBSTITUTE A COMMERCIAL TYPE STRAIGHT PIN FOR THE BOLT AND NUT IN ORDER TO REDUCE THE OVERALL COST OF THE ASSEMBLY. HOWEVER, DUE TO THE FACT THAT THIS CHANGE WAS NOT COORDINATED WITH THE MILITARY ACTIVITY HAVING TECHNICAL COGNIZANCE OF THE ITEM, IT WAS THE OPINION OF THE DIRECTORATE THAT THEY DID NOT HAVE AUTHORITY TO MAKE THE CHANGE. THUS, THE CONTRACTING OFFICER WAS ADVISED THAT THE SPECIFICATION SHOULD BE MODIFIED FOR THIS ASSEMBLY TO REQUIRE THE BOLT AND NUT.

THE CONTRACTING OFFICER THEREFORE MODIFIED CONTRACT DSA500-72-C-1113 TO REQUIRE RUBIN TO SUPPLY ASSEMBLIES WITH A BOLT, NUT, AND COTTER PIN CONFORMING TO DRAWINGS 1204611, 1204612, AND 590210, RESPECTIVELY. INASMUCH AS RUBIN COMPUTED HIS OFFER ON THE BASIS THAT THE SPECIFICATION REQUIRED A STRAIGHT PIN, AND SINCE THE CONTRACTING OFFICER CONSIDERED RUBIN'S INTERPRETATION OF THE SPECIFICATION TO BE REASONABLE UNDER THE CIRCUMSTANCES, AN EQUITABLE ADJUSTMENT WAS NEGOTIATED TO COVER THE MODIFICATION WHICH RESULTED IN AN INCREASE IN THE CONTRACT PRICE OF $30.00 PER UNIT. WHEN THE CONTRACTING OFFICER RECEIVED CONFIRMATION FROM RUBIN, BY LETTER DATED SEPTEMBER 15, 1971, THAT IT HAD PREPARED ITS OFFER BY USING DRAWING 1755752 IN COMPUTING THE COST OF THE SOCKET WITH A STRAIGHT PIN, THE FIRM REPORTED THAT PRODUCTION OF THE ASSEMBLIES WAS PROCEEDING AT THAT TIME. ALSO, SINCE THE REQUISITION FOR THE ASSEMBLIES COVERED BY THE RFP CARRIED AN ISSUE PRIORITY DESIGNATOR OF 06, THE NEED FOR THE ASSEMBLIES WAS CONSIDERED TO BE COMPELLING AND OF UNUSUAL URGENCY. VIEW OF THESE FACTORS, AND INASMUCH AS THE PROPOSED MODIFICATION TO THE CONTRACT WOULD NOT INCREASE THE PRICE ABOVE THAT OF THE NEXT OFFEROR, THE CONTRACTING OFFICER DETERMINED THAT IT WOULD BE IN THE BEST INTEREST OF THE GOVERNMENT TO NEGOTIATE THE MODIFICATION RATHER THAN TO CANCEL RUBIN'S CONTRACT.

THE CONTRACTING OFFICER THEREAFTER CANCELLED IFB-0091 ON THE BASIS THAT THE SPECIFICATION WAS AMBIGUOUS OR INADEQUATE AND ADDITIONALLY DID NOT REFLECT THE CURRENT REQUIREMENTS OF THE GOVERNMENT. BY MESSAGE DATED DECEMBER 16, 1971, THE MARINE CORPS SUPPLY ACTIVITY, THE ACTIVITY HAVING TECHNICAL COGNIZANCE OF THE WIRE ROPE ASSEMBLY, FSN4010-289 9309, ADVISED THE PROCURING ACTIVITY THAT THE BOLT AND NUT WERE STILL REQUIRED COMPONENTS FOR THE ASSEMBLY. WE HAVE BEEN ADVISED THAT THE CONTRACTING OFFICER IS NOW PREPARING AN UNAMBIGUOUS SOLICITATION REQUIRING AN ASSEMBLY HAVING A BOLT, NUT AND COTTER PIN CONFORMING TO DRAWINGS 1204611, 1204612 AND 590210, RESPECTIVELY.

IT IS YOUR CONTENTION THAT EVERYTHING ON ASSEMBLY DRAWING 1203960 MUST BE FURNISHED UNLESS SPECIFIC EXCEPTION IS MADE IN THE SOLICITATION, AND THAT NO SUCH EXCEPTION WAS MADE. YOU STATE THAT IN VIEW OF THE FACT THAT YOU HAD MANUFACTURED THE ITEM IN QUESTION MANY TIMES, YOU HAD NO DIFFICULTY FINDING DRAWINGS 1204611 AND 1204612 IN YOUR FILES, ALTHOUGH BOTH DRAWINGS WERE OMITTED FROM THE SOLICITATION PACKAGES SENT TO YOU. YOU CONTEND THAT THE FACT THAT ONLY THE LISTED DRAWINGS WERE SENT WITH THE SOLICITATIONS DOES NOT PRECLUDE DRAWINGS 1204611 AND 1204612 FROM BEING APPLICABLE SINCE THEY WERE SHOWN ON DRAWING 1203960. ON PAST CONTRACTS YOU STATE THAT YOU WERE REQUIRED TO SUPPLY THE BOLT AND NUT EVEN THOUGH THE SPECIFICATIONS WERE THE SAME AS THE SPECIFICATION FOR RFP-0028 AND IFB-0091.

WE ARE INCLINED TO AGREE WITH THE CONTRACTING OFFICER'S POSITION THAT, ALTHOUGH THE SOLICITATIONS WERE AMBIGUOUS, RUBIN'S INTERPRETATION OF THE SOLICITATION REQUIREMENTS, I.E., THAT A STRAIGHT PIN WAS REQUIRED RATHER THAN A NUT AND BOLT, WAS A REASONABLE INTERPRETATION. THIS VIEW, WE BELIEVE, IS SUPPORTED BY THE FACT THAT DRAWINGS 1204611 AND 1204612 WERE NOT INCLUDED IN THE SPECIFICATION'S LIST OF APPLICABLE DRAWINGS OR IN THE SOLICITATION PACKAGES WHEREAS DRAWING 1755752, WHICH SHOWS THE STRAIGHT PIN, WAS INCLUDED THEREIN. ALSO, SINCE THE SPECIFICATION LISTED AS APPLICABLE ALL OF THE DRAWINGS SHOWN ON DRAWING NUMBER 1203960, EXCEPT DRAWINGS 1204611, 1204612 AND 590210, IT COULD REASONABLY BE CONSTRUED THAT THE REQUIREMENTS OF THE EXCLUDED DRAWINGS WERE NOT TO BE FURNISHED. ADDITIONALLY, WE CANNOT CONCLUDE, IN VIEW OF THE CIRCUMSTANCES INVOLVED, THAT THE CONTRACTING OFFICER'S DECISION TO NEGOTIATE THE MODIFICATION INSTEAD OF CANCELLING RUBIN'S CONTRACT WAS CLEARLY UNWARRANTED.

PARAGRAPH 10(B) OF THE SOLICITATION INSTRUCTIONS AND CONDITIONS OF THE INVITATION EXPRESSLY RESERVES TO THE GOVERNMENT THE RIGHT TO REJECT ANY AND ALL BIDS RECEIVED UNDER THE INVITATION. ALSO, SECTION 2 404.1(B)(I) OF THE ARMED SERVICES PROCUREMENT REGULATION (ASPR) RECOGNIZES THE AUTHORITY OF THE CONTRACTING OFFICER TO REJECT ALL BIDS AFTER OPENING AND PRIOR TO AWARD WHERE HE DETERMINES THAT THE PARTICULAR INVITATION INCLUDES INADEQUATE OR AMBIGUOUS SPECIFICATTIONS. B-159287, JULY 26, 1966. ALSO, SEE B-162382, MAY 17, 1968; B-154415, AUGUST 4, 1964; B-153249, FEBRUARY 17, 1964; 37 COMP. GEN. 479. FROM THE FOREGOING, IT IS CLEAR THAT THE QUESTION OF REJECTING ALL BIDS AND READVERTISING IS PRIMARILY A MATTER OF ADMINISTRATIVE DISCRETION. IN VIEW OF THE FACT THAT THE RESPONSIBILITY FOR MAKING A DETERMINATION TO REJECT ALL BIDS RESTS WITH THE ADMINISTRATIVE OFFICERS OF THE PURCHASING AGENCY, THIS OFFICE WILL NOT OBJECT TO SUCH ACTION IN THE ABSENCE OF CLEAR PROOF OF ABUSE OF THEIR DISCRETIONARY POWERS IN THIS REGARD. THIS IS ESPECIALLY TRUE, WHERE, AS HERE, THE PURPOSE IS TO CORRECT A DEFICIENCY IN THE INVITATION. COURSE, WE HAVE REPEATEDLY OBSERVED THAT THE REJECTION OF BIDS AFTER THEY ARE OPENED AND EACH BIDDER OR PROSPECTIVE BIDDER HAS LEARNED HIS COMPETITOR'S PRICES IS A SERIOUS MATTER AND SUCH ACTION SHOULD NOT BE TAKEN EXCEPT FOR COGENT REASONS. HOWEVER, WE BELIEVE THAT THERE WAS A PROPER BASIS FOR THE CONTRACTING OFFICER'S DETERMINATION THAT THE SPECIFICATION WAS INADEQUATE OR AMBIGUOUS AND, THAT BEING THE CASE, WE WOULD NOT BE JUSTIFIED IN OBJECTING TO THE CANCELLATION OF THE IFB. SEE B -171965, MAY 20, 1971 AND B-159287, JULY 26, 1966.

REGARDING YOUR STATEMENT THAT ON PRIOR GOVERNMENT CONTRACTS YOU SUPPLIED BOLTS AND NUTS WITH THE ASSEMBLIES AND THAT THE SPECIFICATION WAS THE SAME AS THE SPECIFICATION FOR RFP-0028 AND IFB-0091, WE HAVE BEEN ADVISED BY THE PROCURING ACTIVITY THAT ALTHOUGH THE SPECIFICATION FOR PREVIOUS PROCUREMENTS WAS THE SAME AS THE SPECIFICATION FOR RFP 0028 AND IFB-0091, A PRIOR CONTRACTOR FURNISHED ASSEMBLIES WITH THE STRAIGHT PIN WHILE OTHER CONTRACTORS, INCLUDING YOUR FIRM, FURNISHED ASSEMBLIES WITH THE BOLT AND NUT. HOWEVER, EVEN IF YOU HAVE FURNISHED THE ASSEMBLY IN THE PAST WITH A BOLT AND NUT UNDER A SPECIFICATION WHICH IS CONSIDERED TO BE AMBIGUOUS OR INADEQUATE, WE DO NOT BELIEVE THAT THIS FACT WOULD JUSTIFY OUR OBJECTING TO THE MODIFICATION OF RUBIN'S CONTRACT OR TO THE CANCELLATION OF THE IFB.

IN REGARD TO THE AWARD TO RUBIN UNDER RFP-0028, IT MUST BE POINTED OUT THAT RUBIN'S OFFER OF $198.50 WAS THE LOW OFFER RECEIVED. ALSO RUBIN MADE THE OFFER, PURSUANT TO WHAT WE CONSIDER TO BE A REASONABLE INTERPRETATION OF THE SPECIFICATION, WITHOUT QUALIFICATION OR EXCEPTION AND PRIOR TO ANY ISSUE HAVING BEEN RAISED CONCERNING THE REQUIREMENTS OF THE SPECIFICATION. WHILE IT SUBSEQUENTLY DEVELOPED THAT THE OFFERS RECEIVED WERE NOT SUBMITTED ON THE SAME INTERPRETATION OF THE SPECIFICATION, THIS FACTOR DID NOT BECOME ESTABLISHED UNTIL AFTER THE AWARD OF THE CONTRACT AND WORK THEREON HAD COMMENCED. SINCE RUBIN WAS A RESPONSIBLE CONTRACTOR IT DOES NOT APPEAR THAT ANY BASIS HAD BEEN INTRODUCED AT THE TIME OF THE AWARD ON WHICH THE CONTRACTING OFFICER COULD HAVE DENIED THE AWARD TO RUBIN. IN ANY EVENT, INASMUCH AS THE CONTRACT HAS BEEN FULLY PERFORMED, ANY EFFECTIVE RELIEF BY THIS OFFICE CONCERNING THE RFP IS NOW PRECLUDED. FOR THE ABOVE REASONS, YOUR PROTEST MUST BE DENIED.