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REMBAR AND ZOLETAR: REFERENCE IS MADE TO YOUR LETTER OF AUGUST 24. THE INVITATION PROVIDED THAT: "IN THE EVENT BIDDER IS UNABLE TO MAKE DELIVERIES IN ACCORDANCE WITH THE FOREGOING SCHEDULE. HE SHALL SET FORTH IN THE SPACE BELOW HIS PROPOSED DELIVERY SCHEDULE: "BIDS OFFERING A PROPOSED DELIVERY SCHEDULE WHICH WILL EXTEND THE TIME FOR THE DELIVERY OF THE QUANTITIES AS CALLED FOR IN ANY DELIVERY PERIOD OF THE FOREGOING DELIVERY SCHEDULE BY MORE THAN 60 DAYS. UPON A DETERMINATION THAT THE DELIVERY SCHEDULE OFFERED BY THE LOW BIDDER WAS SATISFACTORY TO THE REQUISITIONING AGENCY. AWARD WAS MADE TO JOHN REINER AND COMPANY. THEY WERE THE LOW BIDDER COMPLYING IN ALL RESPECTS TO THE TERMS AND CONDITIONS OF THE INVITATION. 2.

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B-128405, SEP. 17, 1956

TO LEVINE, REMBAR AND ZOLETAR:

REFERENCE IS MADE TO YOUR LETTER OF AUGUST 24, 1956, AND ACCOMPANYING MEMORANDUM, REQUESTING ON BEHALF OF YOUR CLIENT, JOHN REINER AND COMPANY, RECONSIDERATION OF OUR DECISION OF AUGUST 3, 1956, B-128405, TO THE SECRETARY OF THE ARMY, HOLDING THAT THE AWARD OF A CONTRACT TO YOUR CLIENT PURSUANT TO INVITATION NO. DA-ENG-11-184-56-F 707 SHOULD BE CANCELLED.

THE INVITATION CONTAINED A "DESIRED" DELIVERY SCHEDULE. IN ADDITION, THE INVITATION PROVIDED THAT:

"IN THE EVENT BIDDER IS UNABLE TO MAKE DELIVERIES IN ACCORDANCE WITH THE FOREGOING SCHEDULE, HE SHALL SET FORTH IN THE SPACE BELOW HIS PROPOSED DELIVERY SCHEDULE:

"BIDS OFFERING A PROPOSED DELIVERY SCHEDULE WHICH WILL EXTEND THE TIME FOR THE DELIVERY OF THE QUANTITIES AS CALLED FOR IN ANY DELIVERY PERIOD OF THE FOREGOING DELIVERY SCHEDULE BY MORE THAN 60 DAYS, MAY BE CAUSE FOR REJECTION OF BID.

"IN THE EVENT A BIDDER DOES NOT SET FORTH A PROPOSED DELIVERY SCHEDULE THE GOVERNMENT'S DELIVERY SCHEDULE AS HEREINABOVE SET FORTH SHALL BE BIDDER'S PROPOSED DELIVERY SCHEDULE.'

THE LOW BIDDER, JOHN REINAR AND COMPANY, SUBMITTED A DELIVERY SCHEDULE WHICH EXTENDED THE ,DESIRED" SCHEDULE BY 120 DAYS. THE SECOND LOW BIDDER, THE UNITED STATES MOTORS CORPORATION, OFFERED TO MEET THE "DESIRED" SCHEDULE. UPON A DETERMINATION THAT THE DELIVERY SCHEDULE OFFERED BY THE LOW BIDDER WAS SATISFACTORY TO THE REQUISITIONING AGENCY, AWARD WAS MADE TO JOHN REINER AND COMPANY. BY LETTER OF JUNE 27, 1956, UNITED PROTESTED THE AWARD ON THE GROUNDS THAT:

1. THEY WERE THE LOW BIDDER COMPLYING IN ALL RESPECTS TO THE TERMS AND CONDITIONS OF THE INVITATION.

2. NO EXCEPTIONS OR ALTERNATE BIDS WERE ACCEPTABLE UNDER THE PROVISIONS OF THE INVITATION.

3. IF DELIVERY IS OF IMPORTANCE TO THE REQUISITIONING AGENCIES AS INDICATED BY THE DELIVERY REQUIREMENTS, NO EXCEPTION SHOULD BE CONSIDERED UNLESS A LIKE EXCEPTION IS EXTENDED TO ALL BIDDERS.

4. IF DELIVERY IS NOT OF CONSEQUENCE TO THE REQUISITIONING AGENCIES, THEN A RESTRICTIVE OR SUGGESTIVE CLAUSE THAT REFERS TO THE POSSIBLE REJECTION OF A BID EXCEEDING BY MORE THAN SIXTY DAYS THE DESIRED DELIVERY, SHOULD NOT HAVE BEEN INCLUDED IN THE INVITATION.

IN OUR DECISION OF AUGUST 3, 1956, HOLDING THAT THE AWARD SHOULD BE CANCELLED, WE STATED:

"IF THE REQUISITIONING AGENCY DID NOT ACTUALLY REQUIRE DELIVERY ON THE DATES SPECIFIED THEN THE DATES SHOULD HAVE BEEN EXTENDED IN LINE WITH THE GOVERNMENT'S REQUIREMENT, OR SOME ALTERNATIVE SHOULD HAVE BEEN LEFT TO THE BIDDERS TO OFFER LONGER DELIVERY SCHEDULES AT LOWER PRICES, IN WHICH EVENT, OF COURSE, SOME METHOD OF EVALUATING THE BIDS ACCORDING TO PRICE AND DELIVERY DATES SHOULD HAVE BEEN STATED. * * *"

IN YOUR MEMORANDUM SUBMITTED IN SUPPORT OF YOUR REQUEST FOR RECONSIDERATION YOU CONTEND THAT THE PROVISIONS OF THE INVITATION AS TO TIME OF DELIVERY WERE "CLEAR AND UNAMBIGUOUS AND AFFORDED ALL BIDDERS EQUAL OPPORTUNITY TO COMPETE FOR THE BUSINESS," THAT THE RESERVATION OF THE RIGHT TO CONSIDER BIDS EXTENDING THE DESIRED SCHEDULE MORE THAN 60 DAYS IS LEGALLY UNASSAILABLE, AND THAT A STATEMENT IN THE INVITATION OF THE METHOD OF EVALUATING BIDS ACCORDING TO PRICE AND DELIVERY IN SUCH CASES IS NOT REQUIRED BY STATUTE AND WOULD IMPOSE AN "INTOLERABLE BURDEN" ON THE PURCHASING OFFICERS. YOUR FURTHER INDICATE THAT WORK WAS COMMENCED BY REINER BETWEEN THE TIME OF AWARD, JUNE 29, 1956, AND THE RECEIPT OF A COMMUNICATION DATED AUGUST 3, 1956, FROM THE ARMY, TO SUSPEND PERFORMANCE UNDER THE CONTRACT, INDICATING THE POSSIBILITY THAT CANCELLATION OF THE CONTRACT AT THIS TIME WILL RESULT IN ADDITIONAL COSTS TO THE GOVERNMENT.

THE PURPOSE OF STATUTES REQUIRING CERTAIN PUBLIC CONTRACTS TO BE LEFT TO THE LOWEST RESPONSIBLE BIDDER AFTER ADVERTISING IS TO GIVE ALL PERSONS EQUAL RIGHT TO COMPETE FOR GOVERNMENT CONTRACTS, TO PREVENT UNJUST FAVORITISM, OR COLLUSION OR FRAUD IN AWARDING GOVERNMENT CONTRACTS, AND TO SECURE FOR THE GOVERNMENT THE BENEFITS WHICH FLOW FROM FREE AND UNRESTRICTED COMPETITION. SEE UNITED STATES V. BROOKRIDGE FARM, 111 F.2D 461, AFFIRMING 27 F.SUPP. 909. IN ORDER FOR BIDDERS TO COMPETE ON EQUAL TERMS WHEN SUBMITTING BIDS IN RESPONSE TO AN ADVERTISEMENT FOR BIDS, THE SPECIFICATIONS AND INVITATION MUST BE SUFFICIENTLY DEFINITE TO ENABLE THE PREPARATION AND EVALUATION OF BIDS ON A COMMON BASIS. SEE ANNOTATIONS IN 30 L.R.A.N.S. 214-221. CONTRACTS AWARDED UNDER SPECIFICATIONS AND INVITATIONS WHICH ARE NOT SO DRAWN AS TO PERMIT COMPETITION ON AN EQUAL BASIS ARE VOIDABLE. UNITED STATES V. BROOKRIDGE FARM, SUPRA. BIDDERS CANNOT COMPETE ON AN EQUAL BASIS AS REQUIRED BY LAW UNLESS THEY KNOW IN ADVANCE THE BASIS ON WHICH THEIR BIDS WILL BE EVALUATED. DECISION OF MARCH 17, 1955, B 120741.

THE PROVISION IN THE INVITATION STATING THAT BIDS PROPOSING DELIVERY SCHEDULES MORE THAN 60 DAYS LATER THAN THE DESIRED SCHEDULE MAY BE REJECTED, CLEARLY IMPLIES THAT TIME OF DELIVERY WAS TO BE A FACTOR IN EVALUATING THE BIDS. THE INVITATION, HOWEVER, CONTAINS NO INDICATION OF HOW PRICE AND DELIVERY WERE TO BE EQUATED IN AWARDING THE CONTRACT. INTERESTED BIDDERS COULD NOT KNOW WHETHER TO SACRIFICE PRICE FOR DELIVERY WITHIN THE DESIRED SCHEDULE (OR THE DESIRED SCHEDULE PLUS 60 DAYS), WHETHER THE PRICE SHOULD BE MINIMIZED REGARDLESS OF DELIVERY TIME, OR WHETHER SOME COMPROMISE BETWEEN THE TWO FACTORS SHOULD BE REACHED. THE NET EFFECT OF THE PROVISION AS TO TIME OF DELIVERY WAS TO PERMIT THE PURCHASING AGENCY TO EVALUATE THE BIDS ON A BASIS DETERMINED AFTER THE BIDS ARE OPENED. IT COULD HARDLY BE SAID THAT SUCH PROCEDURE WOULD EFFECTUATE THE PURPOSES OF THE STATUTES GOVERNING PUBLIC PROCUREMENT.

IN SUPPORT OF THE CONTENTION STATED AT PAGES 5-6 OF YOUR MEMORANDUM THAT THE RESERVATION OF THE RIGHT TO CONSIDER BIDS EXTENDING THE DELIVERY TIME MORE THAN 60 DAYS (WITHOUT ANY STATED BASIS OF EVALUATION) IS LEGALLY UNASSAILABLE, YOU CITE 34 COMP. GEN. 119. THAT CASE INVOLVED AN INVITATION FOR THE LEASING OF BUILDING SPACE WHICH STATED THAT THE GOVERNMENT DESIRED THE SPACE IN A GIVEN AREA BUT THAT SPACE IN OTHER LOCATIONS WOULD BE CONSIDERED, AND THAT LOCATION OF SPACE, ACCESSIBILITY BY THE PUBLIC AND CONVENIENCE OF TRANSPORTATION WOULD BE FACTORS IN MAKING AN AWARD. IT WAS THERE STATED THAT WE WOULD NOT BE DISPOSED TO DISAGREE WITH AN AWARD OF THE LEASE FOR SPACE OUTSIDE THE DESIRED AREA UPON AN ADMINISTRATIVE DETERMINATION THAT SUCH SPACE WAS ACCESSIBLE TO THE PUBLIC AND CONVENIENTLY REACHED BY PUBLIC TRANSPORTATION. WE STATED AT PAGE 120 THAT UNDER SUCH CIRCUMSTANCES "THERE IS PERCEIVED NO LEGAL BASIS UPON WHICH THIS OFFICE WOULD BE WARRANTED IN QUESTIONING THIS ASPECT OF THE BID;, IN THE NEXT SENTENCE OF THE SAME PARAGRAPH WE ADDED,"AT THE SAME TIME, THERE IS SOME MERIT IN THE ARGUMENT THAT UNDER THE TERMS OF THE INVITATION THE WAY IS OPEN FOR THE ADMINISTRATIVE AGENCY TO EVALUATE THE BIDS IN ALMOST ANY MANNER IT CHOOSES;, IN THAT CASE SOME BASIS FOR EVALUATION OF BIDS OFFERING SITES IN LOCATIONS OUTSIDE THE DESIRED AREA WAS STATED IN THE INVITATION, I.E., ACCESSIBILITY TO THE PUBLIC AND CONVENIENCE OF TRANSPORTATION. IN THE PRESENT CASE EVEN LESS BASIS FOR EVALUATION WAS PROVIDED. ACCORDINGLY, AND SINCE 34 COMP. GEN. 119 WAS DECIDED ON OTHER GROUNDS, WE DO NOT REGARD THAT CASE AS A PRECEDENT ADEQUATE TO SUPPORT THE POSITION THAT THE PROVISIONS AS TO TIME OF DELIVERY ARE "LEGALLY UNASSAILABLE" IN THE INSTANT CASE.

SINCE, AS PREVIOUSLY STATED, BIDDERS CANNOT COMPETE ON AN EQUAL BASIS UNLESS THEY KNOW IN ADVANCE THE BASIS FOR EVALUATING THEIR BIDS, OUR DECISION OF AUGUST 3, 1956, HOLDING THAT THE AWARD SHOULD BE CANCELLED MUST BE SUSTAINED. THE FACT THAT TO REQUIRE THE METHOD OF EVALUATING BIDS TO BE STATED IN THE INVITATION WOULD IMPOSE A BURDEN ON THE PURCHASING AGENCY WOULD NOT, OF COURSE, AFFECT THE LEGALITY OF AN INVITATION WHICH PROVIDES NO BASIS FOR EVALUATION. WHILE EASE OF HANDLING IS A FACTOR WHICH IS OF MAJOR IMPORTANCE TO GOVERNMENT CONTRACTING AGENCIES, IT CANNOT BE USED TO JUSTIFY ACTIONS CONTRARY TO THE PURPOSE FOR WHICH THE APPLICABLE STATUTES WERE ENACTED.

YOU CONTEND ALSO THAT, IN ANY EVENT, SAVINGS WOULD ACCRUE TO THE UNITED STATES IF THE PROCUREMENT WERE CARRIED OUT UNDER THE AWARD TO REINER IN VIEW OF THE RECENT INCREASE IN THE PRICE OF MATERIALS AND OTHER CONSIDERATIONS BUT AS WE HAVE STATED MANY TIMES WE FEEL THAT THE PRESERVATION OF THE COMPETITIVE BIDDING SYSTEM IS MORE BENEFICIAL TO THE GOVERNMENT FROM A LONG-RANGE STANDPOINT THAN A PECUNIARY SAVING REALIZED IN AN INDIVIDUAL CASE. YOU ALSO REFER TO OTHER DECISIONS IN WHICH WE HAVE NOT REQUIRED CANCELLATION OF THE AWARD BUT HAVE DIRECTED THAT THE PROCEDURE BE AMENDED AS TO FUTURE PROCUREMENTS. WHILE WE HAVE TAKEN SUCH ACTION IN CERTAIN CASES, WE FEEL THAT THE CIRCUMSTANCES OF THE PRESENT CASE ARE SUCH THAT A DEPARTURE FROM OUR PREVIOUS DECISION THAT THE AWARD SHOULD BE CANCELLED WOULD NOT BE WARRANTED.

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