B-176623, OCT 20, 1972

B-176623, OCT 20, 1972

BID PROTEST - NONRESPONSIVE BID - QUALIFICATION OF WARRANTY DENIAL OF PROTEST BY WALTER R. TRULAND CORPORATION AGAINST THE AWARD OF A CONTRACT TO ANY OTHER BIDDER FOR THE CONSTRUCTION OF SUBSTATIONS AT THE WATER POLLUTION CONTROL PLANT, WASHINGTON, D.C., UNDER AN IFB ISSUED BY THE GOVERNMENT OF THE DISTRICT OF COLUMBIA. THE TERMS OF A WARRANTY ARE A MATERIAL PART OF BID SPECIFICATIONS AND QUALIFICATION OF WARRANTY TERMS IN A BID WILL REQUIRE REJECTION OF THE BID AS NONRESPONSIVE. SEE 45 COMP. GEN. 273 (1965). THEREFORE, TRULAND'S FAILURE TO OBTAIN THE NECESSARY GUARANTEES FROM ITS TRANSFORMER MANUFACTURER AND TO SUBMIT THESE GUARANTEES WITH ITS BID RENDERED THE BID NONRESPONSIVE TO THE SPECIFICATIONS, AND THE BID WAS PROPERLY REJECTED.

TO SADUR, PELLAND, BRAUDE & CAPLAN:

WE REFER TO YOUR LETTER OF SEPTEMBER 6, 1972, AND PRIOR CORRESPONDENCE, PROTESTING ON BEHALF OF THE WALTER R. TRULAND CORPORATION AGAINST AWARD TO ANY OTHER FIRM OF A CONTRACT FOR THE CONSTRUCTION OF UNIT 32, SUBSTATIONS NOS. 1 AND 2, MAIN SUBSTATION AND RELATED WORK, AT THE WATER POLLUTION CONTROL PLANT, WASHINGTON, D.C., UNDER INVITATION FOR BIDS (IFB) NO. C- 72151-S, ISSUED BY THE GOVERNMENT OF THE DISTRICT OF COLUMBIA.

AN INTEGRAL PORTION OF THE CONSTRUCTION WORK CONSISTED OF THE PURCHASE AND INSTALLATION BY THE SUCCESSFUL BIDDER OF TRANSFORMERS FOR THE UNIT, AND IT IS ON THIS PORTION OF THE WORK THAT YOUR PROTEST CENTERS. BECAUSE THE BIDDERS WERE NOT MANUFACTURERS OF THE TRANSFORMERS, THE IFB REQUIRED SUBMISSION BY EACH BIDDER WITH ITS BID OF CERTAIN GUARANTEES FROM THE MANUFACTURER OF THE TRANSFORMERS THE BIDDER PROPOSED TO SUPPLY FOR THE WORK. THE BIDDER WAS TO SUBMIT THE MANUFACTURER'S GUARANTEE THAT THE TRANSFORMERS TO BE SUPPLIED WOULD MEET CERTAIN TECHNICAL PERFORMANCE REQUIREMENTS. ALSO, PARAGRAPH 25.38 OF THE IFB GENERAL REQUIREMENTS REQUIRED SUBMISSION BY THE BIDDER OF GUARANTEES FROM THE MANUFACTURER TO THE EFFECT THAT:

"A. *** THE APPARATUS FURNISHED UNDER THIS SPECIFICATION SHALL BE FREE FROM INHERENT DEFECTS IN DESIGN, WORKMANSHIP, OR MATERIAL, AND SHALL GIVE PROPER AND CONTINUOUS SERVICE UNDER ALL THE CONDITIONS OF SERVICE REQUIRED AND SPECIFIED OR WHICH MAY BE REASONABLY INFERRED FROM THE SPECIFICATION.

"THE MANUFACTURER SHALL AGREE TO REPLACE, AT HIS OWN EXPENSE, ANY PART OF THE APPARATUS PROVING DEFECTIVE WITHIN ONE YEAR OF THE DATE OF ACCEPTANCE, PROVIDED THE DEFECT EXISTED AT THE TIME OF ACCEPTANCE, OR WAS CAUSED BY FAULTY DESIGN, POOR WORKMANSHIP, OR POOR MATERIAL."

THE WALTER R. TRULAND CORPORATION WAS LOW BIDDER ON THE IFB. HOWEVER, BECAUSE OF THAT BIDDER'S ALLEGED FAILURE TO OBTAIN THE NECESSARY GUARANTEES FROM ITS TRANSFORMER MANUFACTURER AND SUBMIT THESE WITH ITS BID, THE CONTRACTING OFFICER DETERMINED THE TRULAND BID NONRESPONSIVE AND, THEREFORE, INELIGIBLE FOR AWARD. YOU DISAGREE WITH THIS DETERMINATION.

WITH ITS BID, TRULAND SUBMITTED TWO PAGES BEARING THE LETTERHEAD OF THE MANUFACTURER OF THE DISTRIBUTORS TRULAND PROPOSED TO INSTALL. THESE TWO PAGES PURPORTEDLY SET FORTH PERFORMANCE SPECIFICATIONS FOR THE TRANSFORMERS TRULAND WAS TO ACQUIRE FROM THE MANUFACTURER WHICH ARE CONSISTENT WITH THE IFB SPECIFICATIONS AND THE GUARANTEE REQUESTED. IT IS STATED THAT THESE SPECIFICATIONS WERE SPECIFICALLY DRAWN UP BY THE MANUFACTURER FOR THIS PROCUREMENT AND FOR THE PURPOSE OF BEING SUBMITTED WITH THE TRULAND BID. ONE GROUP OF DATA ON THE FIRST PAGE HAS BEEN CROSSED OUT AND NEW DATA INSERTED TO THE SIDE. IT IS STATED THAT THIS WAS DONE BY THE BIDDER WITH THE CONCURRENCE OF A RESPONSIBLE REPRESENTATIVE OF THE MANUFACTURER, THAT REPRESENTATIVE HAVING THE POWER TO BIND THE MANUFACTURER ON THIS MATTER. AS SUCH, IT IS YOUR CONTENTION THAT THE TRULAND BID IS RESPONSIVE TO THE IFB REQUIREMENTS INASMUCH AS THESE TWO PAGES AND THE INFORMATION CONTAINED THEREON SATISFY THE IFB GUARANTEE REQUIREMENTS.

WITHOUT RULING ON THE MERITS OF YOUR CONCLUSION, WE WILL ASSUME THAT THESE PAGES DID CONSTITUTE A SUFFICIENTLY BINDING GUARANTEE BY THE MANUFACTURER THAT ITS TRANSFORMERS WOULD MEET THE PERFORMANCE REQUIREMENTS WHICH WERE TO BE GUARANTEED. HOWEVER, THE IFB REQUIRED NOT ONLY THAT THE MANUFACTURER SHOULD GUARANTEE CERTAIN SPECIFIED PERFORMANCE REQUIREMENTS, BUT ALSO THAT IT SHOULD GUARANTEE, AS CITED ABOVE, THAT IS DISTRIBUTORS WOULD BE FREE FROM INHERENT DEFECTS IN DESIGN, WORKMANSHIP OR MATERIAL AND SHALL GIVE PROPER AND CONTINUOUS SERVICE AND THAT IT WOULD, UNDER SPECIFIED CONDITIONS, REPLACE, AT ITS OWN EXPENSE, ANY PART OF A TRANSFORMER PROVING TO BE DEFECTIVE WITHIN ONE YEAR OF THE DATE OF THE GOVERNMENT'S ACCEPTANCE THEREOF. SUCH A GUARANTEE BY THE MANUFACTURER CAN IN NO WAY BE SAID TO HAVE BEEN SUBMITTED WITH THE TRULAND BID. THAT SUCH A GUARANTEE IS STANDARD AND ACCOMPANIES EVERY PIECE OF EQUIPMENT SOLD BY THE MANUFACTURER MAY BE TRUE. BUT SUCH STATEMENT DOES NOT NEGATE THE FACT THAT THIS GUARANTEE WAS NOT SUBMITTED WITH THE TRULAND BID AS REQUIRED, SO AS TO BE ENFORCEABLE BY THE PROCUREMENT AGENCY DIRECTLY AGAINST THE MANUFACTURER AND SO AS TO PERMIT THE AGENCY TO ASCERTAIN AT BID OPENING THAT THE MANUFACTURER'S STANDARD WARRANTY WAS EQUAL IN ALL RESPECTS TO THE GUARANTEE REQUESTED IN THE IFB.

ONE OF THE BASIC PRINCIPLES OF COMPETITIVE BIDDING FOR PUBLIC CONTRACTS IS THAT A CONTRACT MAY BE AWARDED ONLY ON A BID WHICH IS RESPONSIVE TO THE TERMS OF THE INVITATION. OUR OFFICE HAS RECOGNIZED THAT THE TERMS OF A WARRANTY ARE A MATERIAL PART OF BID SPECIFICATIONS AND THAT A QUALIFICATION OF WARRANTY TERMS IN A BID WILL REQUIRE REJECTION OF SUCH A BID AS NONRESPONSIVE. 45 COMP. GEN. 273 (1965); B 169927(1), MARCH 16, 1971. WE BELIEVE THIS REASONING TO BE APPLICABLE ALSO WHERE, CONTRARY TO THE SPECIFICATION TERMS AND CONDITIONS, NO WARRANTY IS SUBMITTED. THUS WE BELIEVE THE CONTRACTING OFFICER'S DETERMINATION THAT THE TRULAND BID WAS NONRESPONSIVE AND NOT TO BE CONSIDERED FOR AWARD WAS CORRECT.

ACCORDINGLY, THE PROTEST IS DENIED.