B-142601, JUL. 19, 1960

B-142601, JUL. 19, 1960

TO ETSON CONSTRUCTION CORPORATION:

REFERENCE IS MADE TO YOUR LETTER OF APRIL 11, 1960, PROTESTING THE REJECTION OF YOUR BID SUBMITTED IN RESPONSE TO INVITATION FOR BIDS NO. 30- 603-60-38 ISSUED BY THE STEWART AIR FORCE BASE, NEW YORK, ON NOVEMBER 25, 1959.

THE INVITATION REQUESTED BIDS--- TO BE OPENED 9 A.M., E.S.T., DECEMBER 28, 1959--- FOR THE MODIFICATION OF THE BASE WATER TREATMENT PLANT. CERTAIN ITEMS OF EQUIPMENT REQUIRED FOR THE PROJECT WERE DESCRIBED IN THE SPECIFICATIONS ON A "BRAND NAME OR EQUAL" BASIS. THE STANDARD ,BRAND NAME OR EQUAL" CLAUSE AS SET FORTH IN PARAGRAPH 1 305.6 (C) (2) OF THE ARMED SERVICES PROCUREMENT REGULATION WAS INCLUDED AS AN ATTACHMENT TO THE INVITATION FOR BIDS. THIS ATTACHMENT CONTAINED THE FOLLOWING STATEMENT:

"BIDDERS MUST CLEARLY INDICATE WHETHER THEIR BIDS ARE BASED ON A BRAND NAME ITEM OR AN "EQUAL" ITEM BY FURNISHING THE INFORMATION REQUIRED BELOW. IF THE BIDDER DOES NOT IDENTIFY THE BRAND NAME OR DESCRIBE IN FULL THE "OR EQUAL" ITEM WHICH IS OFFERED, AS PROVIDED IN (1) AND (2) BELOW, THE BID WILL BE REJECTED.'

ELEVEN BIDS WERE RECEIVED. YOUR BID IN THE AMOUNT OF $55,303 WAS LOW. YOU WERE INFORMED THAT YOU HAD SUBMITTED THE APPARENT LOW BID AND YOU WERE REQUESTED TO SECURE A PERFORMANCE BOND. HOWEVER, IN REVIEWING THE BIDS RECEIVED, THE CONTRACTING OFFICER DISCOVERED THAT YOU HAD FAILED TO FURNISH COMPLETE INFORMATION AS REQUIRED BY THE "BRAND NAME OR EQUAL" ATTACHMENT. IN ACCORDANCE WITH THE ABOVE-QUOTED STATEMENT CONTAINED THEREIN, YOU WERE ADVISED THAT YOUR BID HAD BEEN REJECTED. SINCE THE SECOND LOW BID WAS NOT ACCOMPANIED BY AN ADEQUATE BID BOND, IT WAS REJECTED. AWARD WAS THEN MADE TO THE ARTESIAN CONSTRUCTION COMPANY AT ITS BID PRICE OF $59,985.

IN THE MEMORANDUM ENCLOSED WITH YOUR LETTER OF APRIL 11, 1960, YOU PRESENT SEVERAL REASONS AS TO WHY YOU BELIEVE THAT YOUR BID WAS IMPROPERLY REJECTED. IN THE FIRST PLACE, YOU CONTEND THAT THE "BRAND NAME OR EQUAL" ATTACHMENT WAS NOT IDENTIFIED AS SUCH IN THE INVITATION ALTHOUGH ALL THE OTHER ATTACHMENTS WERE LISTED IN THE INVITATION. IN REGARD TO THIS CONTENTION, IT IS NOTED THAT WHILE PAGE 2 OF INVITATION FORM (STANDARD FORM 20) DID NOT SPECIFICALLY CALL ATTENTION TO THE "BRAND NAME OR EQUAL" ATTACHMENT, PAGE 1 CONTAINED A STATEMENT THAT THE BIDS MUST SET FORTH FULL, ACCURATE AND COMPLETE INFORMATION AS REQUESTED BY THE INVITATION (INCLUDING ATTACHMENTS). THE ,BRAND NAME OR EQUAL" CLAUSE WAS PHYSICALLY ATTACHED TO THE INVITATION AND AN EXAMINATION OF THE MATERIALS COMPRISING THE INVITATION SHOULD HAVE BROUGHT IT TO THE ATTENTION OF ALL PROSPECTIVE BIDDERS.

YOU CONTEND, ALSO, THAT THE "BRAND NAME OR EQUAL" REQUIREMENT IS NOT APPLICABLE TO THE CONSTRUCTION CONTRACT UNDER THE INVITATION AND THAT THE DEPARTMENT OF THE AIR FORCE HAD KNOWLEDGE THAT THIS REQUIREMENT WAS NOT APPLICABLE TO THIS INVITATION WHEN THE DEPARTMENT PASSED ON YOUR PROTEST ON MARCH 25, 1960. IN SUPPORT OF YOUR CONTENTION YOU REFER TO THE FEDERAL PROCUREMENT REGULATIONS EFFECTIVE JUNE 1, 1959, AND YOU STATE THAT THESE REGULATIONS PROVIDE THAT THE "BRAND NAME OR EQUAL" CLAUSE WAS NOT TO BE USED IN CONSTRUCTION CONTRACTS. THERE IS NO SPECIFIC STATUTE EITHER AUTHORIZING OR SPECIFYING WHEN "BRAND NAME OR EQUAL" DESCRIPTIONS CAN BE USED IN GOVERNMENT CONTRACTS. THE FEDERAL PROCUREMENT REGULATIONS TO WHICH YOU REFER STATE IN PARAGRAPH 5 OF THE INTRODUCTION THEREOF THAT THE EXTENT TO WHICH THE REGULATIONS WILL BE USED BY THE DEPARTMENT OF DEFENSE WILL BE DETERMINED BY THE DEPARTMENT OF DEFENSE. AT THE TIME THE INVITATION WAS ISSUED AS WELL AS WHEN YOUR BID WAS REJECTED AND THE AWARD MADE TO ARTESIAN CONSTRUCTION COMPANY, THE ARMED SERVICES PROCUREMENT REGULATION DID NOT EXCLUDE THE STANDARD "BRAND NAME OR EQUAL" PROVISION FROM CONSTRUCTION CONTRACTS. IT WAS NOT UNTIL JANUARY 5, 1960, THAT AIR FORCE PROCUREMENT CIRCULAR NO. 1 MADE THIS PROVISION INAPPLICABLE TO CONTRACTS FOR CONSTRUCTION, REHABILITATION AND REPAIR OF BUILDINGS AND STRUCTURES. THUS, SINCE THERE WAS NO PROVISION MAKING THE CLAUSE INAPPLICABLE TO CONTRACTS FOR CONSTRUCTION, ETC., WHEN THE INVITATION WAS ISSUED AND THE AWARD WAS MADE, THE REVIEWING OFFICIALS COULD NOT GIVE EFFECT TO THE LATER CHANGE IN THE REGULATIONS IN CONSIDERING YOUR FAILURE TO COMPLETE THE ATTACHMENT PERTAINING TO THE "BRAND NAME OR EQUAL" PROVISION.

IN REGARD TO YOUR STATEMENT THAT THE DECISION OF THE CONTRACTING OFFICER TO AWARD THE CONTRACT TO YOU WAS IRREVOCABLE, IT IS REPORTED THAT THE CONTRACTING OFFICER DID TELEPHONE YOU ON DECEMBER 29, 1959, AND INFORMED YOU THAT YOUR BID WAS LOW AND REQUESTED YOU TO SECURE A PERFORMANCE BOND. HOWEVER, THIS NOTICE CANNOT BE CONSIDERED A FORMAL AWARD BECAUSE OF THE STATUTORY REQUIREMENT FOR WRITTEN NOTICE IN SUCH CASES AS CONTAINED IN 10 U.S.C. 2305 (C).

IN CONNECTION WITH YOUR PROTEST, THERE HAS BEEN SUBMITTED TO OUR OFFICE BY YOUR ATTORNEY, MR. J. FRANCIS HAYDEN, AN AFFIDAVIT EXECUTED BY YOUR PRESIDENT, MR. FRANK E. TOTONELLY, TO THE EFFECT THAT, PRIOR TO THE SUBMISSION OF YOUR BID ON DECEMBER 28, 1959, OR ON DECEMBER 23, 1959, HE HAD ARRANGED A MEETING WITH THE DEPUTY BASE ENGINEER AS TO THE ACCEPTABILITY OF THE PRODUCTS OF FISCHER AND PORTER CO. WHICH WAS NAMED AS THE "EQUAL BRAND" IN YOUR BID. IT IS STATED IN THE AFFIDAVIT THAT THE DEPUTY BASE ENGINEER CONSIDERED THE ACCEPTABILITY OF THESE PRODUCTS AND THAT THE BASE ENGINEER ISSUED A DIRECTIVE TO THE CONTRACTING OFFICER ADVISING HIM THAT THESE PRODUCTS WERE ACCEPTABLE. OUR OFFICE HAS BEEN INFORMALLY ADVISED THAT WHATEVER NOTICE, IF ANY, WAS GIVEN TO THE CONTRACTING OFFICER AS TO THE ACCEPTABILITY OF THESE PRODUCTS WAS NOT RECEIVED BY HIM PRIOR TO THE TIME SET FOR THE OPENING OF BIDS NOR WAS ANY LITERATURE THEREOF FURNISHED AT THE TIME. INSOFAR AS YOUR BID OF DECEMBER 28, 1959, IS CONCERNED, YOU FAILED TO FURNISH THE DETAILS AS REQUIRED ON THE "OR EQUAL" PRODUCTS AND YOU DID NOT MAKE ANY REFERENCE IN YOUR BID--- IN LIEU OF FURNISHING THE REQUIRED DETAIL AT THE TIME--- TO YOUR PRIOR DISCUSSION IN THE MATTER. SINCE THE INVITATION STATED THAT A FAILURE TO DESCRIBE IN FULL THE "OR EQUAL" ITEM OFFERED WOULD REQUIRE THE REJECTION OF A BID BASED ON SUCH AN ITEM, THE CONTRACTING OFFICER HAD NO CHOICE BUT TO REJECT YOUR BID. COMPARE 36 COMP. GEN. 415. THE DATA REQUIRED TO BE FURNISHED WAS NECESSARY FOR THE PURPOSE OF EVALUATING BIDS AND FOR THAT REASON IT WOULD HAVE BEEN IMPROPER TO WAIVE THE REQUIREMENT.

IN THE CIRCUMSTANCES, OUR OFFICE WOULD NOT BE WARRANTED IN HOLDING THAT THE AWARD TO ARTESIAN CONSTRUCTION COMPANY IS IMPROPER.