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WE HAVE BEEN FURNISHED WITH A REPORT ON A PROTEST BY THE CALIFORNIA ELECTRICAL MANUFACTURING AND SERVICE COMPANY (DIVISION OF ETS-HOKIN CORPORATION) UNDER INVITATION FOR BIDS NO. THE FILE REVEALS THAT THE SUBJECT INVITATION WAS ISSUED ON DECEMBER 17. UNDER THE TERMS OF THE INVITATION BIDDERS WERE INVITED TO SUBMIT BIDS FOR THE PRODUCTION OF 5. 219 TRAILERS WAS SET ASIDE FOR AWARD TO LABOR SURPLUS AREA CONCERNS. ON PAGE 2C BIDDERS WERE ADVISED THAT BIDS SHOULD BE SUBMITTED ON THE BASIS OF MAKING DELIVERY F.O.B. INCLUDED IN THE BID PACKAGE WERE OTA FORMS 4059 AND 4059 A (JUNE 23. MUST FURNISH THE TRANSPORTATION DATA SET FORTH ON HPC FORM 4059A WHICH IS NECESSARY IN EVALUATING THE GOVERNMENT'S COST OF TRANSPORTATION AND FOR USE IN THE SELECTION OF THE MODE OF SHIPMENT.

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B-156461, JUN. 14, 1965

TO THE HONORABLE SECRETARY OF THE ARMY:

BY CORRESPONDENCE DATED MAY 21, 1965, FROM THE DIRECTOR OF PROCUREMENT AND PRODUCTION, UNITED STATES ARMY MATERIEL COMMAND, WE HAVE BEEN FURNISHED WITH A REPORT ON A PROTEST BY THE CALIFORNIA ELECTRICAL MANUFACTURING AND SERVICE COMPANY (DIVISION OF ETS-HOKIN CORPORATION) UNDER INVITATION FOR BIDS NO. AMC-20-113-65-1553/T).

THE FILE REVEALS THAT THE SUBJECT INVITATION WAS ISSUED ON DECEMBER 17, 1964, BY THE ARMY TANK AUTOMOTIVE CENTER (ATAC), WARREN, MICHIGAN. UNDER THE TERMS OF THE INVITATION BIDDERS WERE INVITED TO SUBMIT BIDS FOR THE PRODUCTION OF 5,220 TWO-WHEEL, ONE-QUARTER TON, M416 TRAILERS. ADDITIONAL QUANTITY OF 5,219 TRAILERS WAS SET ASIDE FOR AWARD TO LABOR SURPLUS AREA CONCERNS. ON PAGE 2C BIDDERS WERE ADVISED THAT BIDS SHOULD BE SUBMITTED ON THE BASIS OF MAKING DELIVERY F.O.B. CARRIER EQUIPMENT, WHARF, OR FREIGHT STATION AT OR NEAR THE CONTRACTOR'S PLANT (F.O.B. ORIGIN). THE INVITATION FURTHER ADVISED THAT BIDS WOULD BE EVALUATED ON THE BASIS OF TOTAL COST TO THE GOVERNMENT INCLUDING CONSIDERATION OF TRANSPORTATION AND LOADING COSTS FROM THE F.O.B. POINT OF ORIGIN TO THE GOVERNMENT'S FINAL DESTINATIONS. INCLUDED IN THE BID PACKAGE WERE OTA FORMS 4059 AND 4059 A (JUNE 23, 1964). OTA FORM 4059 (PAGE 3H OF THE INVITATION) PROVIDES, IN PERTINENT PART, AS FOLLOWS:

"A. BIDDERS, IN ADDITION TO THE OTHER PROVISIONS OF THIS BID, MUST FURNISH THE TRANSPORTATION DATA SET FORTH ON HPC FORM 4059A WHICH IS NECESSARY IN EVALUATING THE GOVERNMENT'S COST OF TRANSPORTATION AND FOR USE IN THE SELECTION OF THE MODE OF SHIPMENT. FAILURE TO FURNISH THE DATA REQUESTED WILL CAUSE THE BID TO BE NON-RESPONSIVE.

"B. INDICATE ON THE HPC FORM 4059A (PAR L BELOW) SHIPPING FACILITIES AT F.O.B. POINTS.

"C. SPECIFY THE EXACT NUMBER OF IDENTICAL UNITS PER CARLOAD, TRUCKLOAD OR HEAVY HAULER. IF A FACILITY IS NOT APPLICABLE OR IF CONSTRUCTION OF THE VEHICLE PROHIBITS A PARTICULAR MODE, LEAVE THE SPACE BLANK.

"D. IF THE BIDDER INDICATES THE AVAILABILITY OF RAIL FACILITIES AT THE F.O.B. POINT, IT MUST STATE, AS A PART OF ITS END ITEM UNIT PRICE OR AS A SEPARATE CHARGE, ALL CHARGES FOR LOADING, BLOCKING, BRACING, DRAYAGE, SWITCHING AND SUCH OTHER SERVICES AS ARE NECESSARY TO COMPLETELY PREPARE THE END ITEM FOR SHIPMENT BY RAIL. THE FAILURE OF THE BIDDER TO INCLUDE ALL CHARGES IN CONNECTION WITH MAKING DELIVERY BY RAIL, F.O.B. ORIGIN, SHALL NOT BE A BASIS FOR ANY CLAIMS AGAINST THE GOVERNMENT FOR ADDITIONAL MONIES IF SHIPMENT IS MADE BY RAIL.

"E. DESIGNATION OF A SPECIFIC CARRIER BY A BIDDER AS BEING AVAILABLE FROM ITS F.O.B. POINT SHALL BIND SAID BIDDER TO SHIPMENT BY THAT CARRIER, IF THE GOVERNMENT SELECTS THE MODE OF TRANSPORTATION IN WHICH CARRIER IS ENGAGED. IF AT THE SAME TIME OF ACTUAL SHIPMENT, THE DESIGNATED CARRIER IS NOT AVAILABLE, AND SHOULD SUCH NONAVAILABILITY RESULT IN AN INCREASE TO THE GOVERNMENT IN SHIPPING COSTS, THE CONTRACT PRICE SHALL BE REDUCED BY AN AMOUNT COMMENSURATE WITH THE AMOUNT OF SAID INCREASE.

"F. WHEN APPLICABLE CARRIERS' TARIFFS INCLUDE SERVICES, EITHER IN THE FREIGHT RATE OR AS AN EXTRA CHARGE FOR PREPARING VEHICLES FOR THE METHODS OF SHIPMENT INDICATED BELOW, SUCH PROVISIONS WILL BE CONSIDERED IN THE FREIGHT EVALUATION. IF APPLICABLE CARRIER'S TARIFFS REQUIRE THE SHIPPER TO PREPARE THE VEHICLES FOR THE METHODS OF SHIPMENT INDICATED BELOW, THE BIDDER SHALL INDICATE ITS COST FOR PERFORMING THIS SERVICE OPPOSITE LOADING CHARGES FOR EACH MODE OF TRANSPORTATION. THIS LOADING CHARGE SHALL INCLUDE ALL COSTS NECESSARY TO EFFECT DELIVERY F.O.B. OR F.A.S. CARRIER'S EQUIPMENT SPECIFIED BY THE GOVERNMENT AT THE TIME OF SHIPMENT. ANY CHARGES LISTED WILL BE INCLUDED IN THE OVER-ALL TRANSPORTATION EVALUATION OF THE BID. EXCEPT FOR ANY CHARGES LISTED, ALL COSTS PROVIDING ALL SERVICES NECESSARY TO EFFECT DELIVERY F.O.B. OR F.A.S. CARRIER'S EQUIPMENT, SPECIFIED BY THE GOVERNMENT AT THE TIME OF SHIPMENT, WILL BE CONSIDERED AS INCLUDED IN THE ITEM BID PRICE QUOTED.

"G.THE INFORMATION LISTED BELOW IS NECESSARY FOR DETERMINATION OF TRANSPORTATION COST TO THE GOVERNMENT. WHENEVER ANY TRANSPORTATION CHARACTERISTICS DIFFER AT A TIME OF SHIPMENT FROM THOSE STATED BY THE BIDDER (CONTRACTOR), EXCEPT AS A RESULT OF A CHANGE OR DEVIATION APPROVED BY THE GOVERNMENT, AND SUCH DIFFERENCE RESULTS IN INCREASED GOVERNMENT TRANSPORTATION COSTS, THE GOVERNMENT SHALL REDUCE THE CONTRACT PRICE IN THE AMOUNT OF SUCH INCREASE. TRANSPORTATION CHARACTERISTICS ARE DEFINED FOR THE PURPOSE OF THIS BID, AS THE STATED WEIGHT, DIMENSIONS, MODE OF TRANSPORTATION, THE TYPE AND SIZE OF CARRIER'S EQUIPMENT, THE NUMBER OF UNITS BIDDER WILL LOAD FOR THE SEPARATE TYPES AND SIZES OF CARRIER'S EQUIPMENT AND THE UNIT LOADING CHARGE HE DESIRES TO RECOVER FOR SUCH LOADING OVER AND ABOVE THE UNIT END ITEM BID PRICE AND THE NAME OF THE CARRIERS (RAIL OR WATER) AVAILABLE AT THE BIDDERS' F.O.B. POINTS.'

ON THE FOLLOWING PAGE (FORM 4059-A) CEMSCO INDICATED THAT IT WOULD LOAD 50 TRAILERS ON A CONVENTIONAL RAILROAD CAR AT A CHARGE OF $1.00 PER VEHICLE. THE SIZE OF THE CARRIER'S EQUIPMENT WAS NOT SPECIFIED NOR WAS ANY OTHER METHOD OF SHIPMENT OFFERED.

ALTHOUGH THE FILE CONTAINS EVIDENCE SHOWING THAT OFFICIALS AT ATAC HAD SEVERAL DISCUSSIONS WITH THE PROTESTING BIDDER CONCERNING VARIOUS ASPECTS OF CEMSCO'S BID THERE IS NO EVIDENCE INDICATING THAT EITHER PARTY EVER BECAME AWARE OF THE FACT THAT IT WAS IMPOSSIBLE TO LOAD 50 VEHICLES OF THIS SIZE ON A CONVENTIONAL RAILROAD CAR UNTIL JANUARY 26, 1965, SOME EIGHT DAYS AFTER THE BID OPENING. WHEN THIS QUESTION WAS FIRST RAISED, CEMSCO RESPONDED THAT THE QUOTATION OF 50 TRAILERS WAS INSERTED AFTER THIS MATTER HAD BEEN DISCUSSED WITH A REPRESENTATIVE OF THE RAILROAD. LETTER DATED JANUARY 28, 1965, CEMSCO ADVISED THAT THE DISTRICT FREIGHT AGENT FOR THE SOUTHERN PACIFIC AND PACIFIC ELECTRIC RAILWAY COMPANY HAD REANALYZED CEMSCO'S APPROACH AND HAD CONFIRMED THE FACT THAT 50 M416 TRAILERS COULD BE LOADED ON A "BI LEVEL CAR.' ON FEBRUARY 1, 1965, CEMSCO DISPATCHED THE FOLLOWING LETTER TO THE LOS ANGELES PROCUREMENT DISTRICT:

"PER YOUR REQUEST WE SUBMIT THE ATTACHED SKETCH SHOWING HOW WE PROPOSE TO LOAD.

"THE SKETCH FIG. (1) (REV-10-1960) DESCRIBES LOADING 24 UNITS ON A 43 FOOT LONG FLAT CAR; WE CAN BI-LEVEL THIS LENGTH CAR AND LOAD 32 TRAILERS; A 53 FOOT CAR BI-LEVELED WILL HANDLE 37 TRAILERS AND AN 89 FOOT BI-LEVEL WILL CARRY 50 UNITS.

"THERE IS A POSSIBILITY OF CLEARANCE PROBLEMS USING THE 89 FOOT AND CARRYING 50 TRAILERS. FORTY THREE (43) UNITS CAN BE LOADED (AS PER SKETCH ATTACHED) WITHOUT THE CLEARANCE PROBLEM.

"I TRUST THIS INFORMATION WILL CLARIFY THE SUBJECT QUESTION OF FLAT CAR LOADING.'

SUBSEQUENTLY, ON FEBRUARY 9, 196, CEMSCO ADVISED THAT A 50-FOOT BI LEVEL CAR WOULD NOT BE AVAILABLE. APPARENTLY IT WAS AT THIS POINT IN TIME THAT THE QUESTION OF THE LOADING CHARGE AROSE SINCE THE ABOVE LETTER WENT ON TO CONFIRM THE $1.00 LOADING CHARGE. THIS SAME CHARGE WAS AGAIN CONFIRMED ON FEBRUARY 10, 1965.

ON MARCH 27, 1965, ATAC INFORMED CEMSCO THAT ITS BID HAD BEEN DETERMINED TO BE NON-RESPONSIVE AND THAT IT COULD NOT BE CONSIDERED FOR AWARD. THIS LETTER STATES:

"DURING EVALUATION OF YOUR BID, CONSIDERATION WAS GIVEN TO YOUR PROPOSED LOADING OF FIFTY (50) UNITS PER CONVENTIONAL RAILCAR. IN SUBSEQUENT TELEPHONE CALLS, LETTERS AND TELEGRAMS, YOU PURPORTEDLY CLARIFIED YOUR LOADING DATA. YOU INDICATED THE FIFTY (50) UNIT LOADING PATTERN ON A CONVENTIONAL RAILCAR WAS IMPOSSIBLE AND WAS APPLICABLE TO BI-LEVEL RATHER THAN CONVENTIONAL CARS, BUT THAT SUCH BI-LEVEL CARS WERE NOT AVAILABLE. FINALLY, IN LETTER DATED 10 FEBRUARY 1965, YOU PRESENTED DEFINITE LOADING PATTERNS TOGETHER WITH AN OFFER OF THE APPLICABLE ADDITIONAL LOADING CHARGE.

"THE IFB PROVIDED THAT BIDDERS TO BE RESPONSIVE MUST FURNISH SPECIFIC TRANSPORTATION DATA, INCLUDING SIZE OF CAR, LOADING PATTERN TO BE USED, AND ANY ADDITIONAL LOADING CHARGE REQUIRED BY THE BIDDER. THIS DATA IS ESSENTIAL TO PERMIT ACCURATE TRANSPORTATION EVALUATION OF SUCH BID IN ORDER TO DETERMINE THE LOWEST BID PRICE INCLUDING THE GOVERNMENT'S TRANSPORTATION COST TO SPECIFIED DESTINATIONS. FURTHER, IT ESTABLISHES BINDING COMMITMENTS ON THE PART OF THE BIDDER AS TO THE METHOD OF TRANSPORTATION WHICH MAY BE SELECTED BY THE GOVERNMENT AFTER AWARD OF THE CONTRACT WITHOUT FURTHER PRICE ADJUSTMENT. IN THE CASE OF YOUR BID, NO SUCH TRANSPORTATION DATA WAS INCLUDED IN THE BID, AS SUBMITTED. IT IS A CARDINAL PRINCIPLE OF FORMAL ADVERTISING THAT BIDS MAY NOT BE MODIFIED AFTER OPENING IN CONNECTION WITH MATTERS WHICH INVOLVE PRICE. THIS PRINCIPLE MUST BE RIGIDLY ADHERED TO SINCE TO DO OTHERWISE WOULD BE PREJUDICIAL TO OTHER BIDDERS WHOSE BIDS ARE EVALUATED SOLELY ON THE DATA CONTAINED IN THEIR BIDS, AS SUBMITTED.'

IN THEIR BRIEF DATED APRIL 19, 1965, THE ATTORNEYS FOR CEMSCO TAKE ISSUE WITH THE ABOVE LETTER. SPECIFICALLY THEY STATE:

"* * * THE LETTER STATES THAT CEMSCO, IN SUPPLYING ADDITIONAL TRANSPORTATION INFORMATION, HAD OFFERED AN ADDITIONAL LOADING CHARGE. COMPLETELY TO THE CONTRARY, CEMSCO'S LETTER AND TELEGRAM OF FEBRUARY 9, 1965 AND ITS LETTER OF FEBRUARY 10, 1965 CONFIRM THE QUOTED LOADING CHARGE OF $1.00 PER UNIT.

"THE SECOND PARAGRAPH OF THE ATAC LETTER DATED MARCH 27, 1965, REFERS TO SOME OF THE INFORMATION AND TRANSPORTATION DATA WHICH IT STATES A BIDDER MUST PROVIDE AND THEN CONCLUDES THAT ,NO SUCH TRANSPORTATION DATA WAS INCLUDED IN THE BID, AS SUBMITTED.' CEMSCO DOES NOT AGREE WITH THIS CONCLUSION. CEMSCO PROVIDED ALL OF THE INFORMATION CLEARLY REQUIRED BY OTA FORMS 4059 AND 4059-A WITH RESPECT TO SHIPMENT BY CONVENTIONAL RAILROAD CAR. CEMSCO DID NOT PROVIDE AT THE TIME OF BIDDING INFORMATION WITH RESPECT TO MODES OF TRANSPORTATION OTHER THAN CONVENTIONAL RAILROAD FLAT CAR. THIS INFORMATION, OBTAINED FROM A REPRESENTATIVE OF THE RAILROAD AND NOT SUBJECT TO CHANGE BY THE BIDDER, WAS SUBSEQUENTLY SUPPLIED.'

UPON REVIEW WE AGREE THAT ATAC WAS WRONG IN STATING THAT CEMSCO HAD OFFERED AN "ADDITIONAL LOADING CHARGE.' AFTER CAREFUL EXAMINATION OF THE LETTERS AND OTHER DOCUMENTS INCLUDED WITHIN THE FILE, WE FIND NO EVIDENCE WHATSOEVER INDICATING THAT CEMSCO HAD EVER SUGGESTED THAT ITS LOADING CHARGE OF $1.00 WAS IN ERROR OR THAT IT INTENDED TO CHARGE ANY ADDITIONAL AMOUNTS FOR LOADING. WHILE IT IS TRUE THAT CEMSCO DID NOT SPECIFY THE EXACT SIZE OF THE CONVENTIONAL CAR, WE DO NOT BELIEVE THAT THIS OMISSION NECESSARILY PRECLUDES CONSIDERATION OF THEIR BID SINCE IT IS CONCEDED THAT CEMSCO'S BID IS LOW EVEN IF WE ASSUME LOADING ON A MINIMUM 40-FOOT CONVENTIONAL CAR AND A LOADING CHARGE OF $1.00.

IN HIS REPORT DATED APRIL 30, 1965, THE CONTRACTING OFFICER STATES HIS POSITION AS FOLLOWS:

"A. THE IFB PLAINLY REQUIRES, AS A MATTER OF RESPONSIVENESS, THAT THE TRANSPORTATION DATA IN QUESTION BE FURNISHED WITH THE BID. IT IS ALSO CLEAR THAT THE SAID DATA IS A MATERIAL MATTER BOTH AS REGARDS PRICE AND AS CONSTITUTING BINDING OFFERS OF SHIPMENT METHODS TO THE GOVERNMENT.

"B. THE LOADING CHARGE OF $1.00 ON THE BID CAN BE PROPERLY VIEWED AS APPLICABLE ONLY TO THE PARTICULAR SHIPMENT METHOD OFFERED BY THE BIDDER IN ITS BID. SINCE THAT LOADING PATTERN IS IMPOSSIBLE OF PERFORMANCE, AND SINCE LOADING FIFTY (50) UNITS IS POSSIBLE ONLY WITH BI-LEVEL CARS WHICH THE BIDDER DECLARES UNAVAILABLE, IT MUST BE CONCLUDED THAT THE BID AS SUBMITTED OFFERS NO VALID TRANSPORTATION DATA OR COMMITMENTS, EVEN AS TO LOADING CHARGE. IN THIS CASE, THERE WOULD HAVE BEEN NO RESTRAINT TO PRECLUDE THE BIDDER FROM DEMANDING A HIGHER LOADING CHARGE THAN $1.00 PER VEHICLE IN CONNECTION WITH THE TRANSPORTATION METHODS OFFERED AFTER BID OPENING.

"C. UNDER THESE CIRCUMSTANCES, THE OFFERING OF TRANSPORTATION DATA AFTER OPENING IS CONSIDERED A MATERIAL MODIFICATION OF BID PREJUDICIAL TO OTHER BIDDERS. IN EFFECT, ACCEPTANCE OF SUCH DATA FOR EVALUATION AND TRANSPORTATION COMMITMENT PURPOSES WOULD CONSTITUTE AN OPPORTUNITY FOR A SECOND BID.

"D. AS REGARDS THE MATTER OF MISTAKE IN BID, THE BIDDER'S PROTEST ITSELF REVEALS THAT IT BID PRECISELY WHAT WAS INTENDED, ALBEIT UNDER AN ERRONEOUS IMPRESSION. NONETHELESS, AS REGARDS MODE OF TRANSPORTATION, NO OTHER BID WAS ACTUALLY INTENDED. IN ANY EVENT, CORRECTION OF MISTAKE IS NOT RELEVANT BECAUSE IT WOULD RENDER RESPONSIVE A BID WHICH IS CONSIDERED TO BE NONRESPONSIVE.

"E. AS PREVIOUSLY STATED, AN EVALUATION BASED UPON LOADING THE LEAST NUMBER OF VEHICLES ON THE TYPE AND SIZE EQUIPMENT DESIGNATED BY THE BIDDER AFTER OPENING RESULTS IN THE BID NOT REMAINING LOW. THIS EVALUATION WAS CONDUCTED IN THE EVENT THAT THE DECISION IN 43 CG 537 MIGHT BE CONSIDERED APPLICABLE. IT IS, HOWEVER, BELIEVED THAT SAID DECISION IS TO BE DISTINGUISHED FROM THE INSTANT CASE. IN THIS CASE, THE ENTIRE OFFER OF SHIPMENT METHOD WOULD HAVE TO BE SUPPLIED BY THE DATA FURNISHED AFTER BID OPENING. IN 43 CG 537, NONRESPONSIVENESS WAS NOT AN ISSUE SINCE THE IFB ERRONEOUSLY FAILED TO REQUIRE SUBMISSION OF SHIPPING WEIGHTS. IT IS CONSIDERED THAT THIS CASE IS GOVERNED BY COMPTROLLER GENERAL DECISION B- 155845 DATED 18 MARCH 1965.' AS ABOVE INDICATED, THE CONTRACTING OFFICER APPEARS TO TAKE THE VIEW THAT THE LOADING CHARGE IS SO INEXTRICABLY RELATED AND TIED TO THE METHOD OF SHIPMENT OFFERED THAT IF IT IS SUBSEQUENTLY FOUND THAT THE LOADING PATTERN OFFERED IS UNREALISTIC OR CANNOT BE ACCOMPLISHED, THEN THE LOADING CHARGE GUARANTEE MUST FAIL. DO NOT AGREE. CONTRARY TO THE CONTRACTING OFFICER'S VIEW WE DO NOT BELIEVE THAT THE LOADING CHARGE OFFERED WAS PROPERLY INTERPRETED AS APPLICABLE ONLY IF 50 VEHICLES WERE SHIPPED ON A CONVENTIONAL RAILROAD CAR. AS PROVIDED ON FORM 4059, PARAGRAPH "D," QUOTED ABOVE, IF THE BIDDER INDICATES THE AVAILABILITY OF RAIL FACILITIES, HE IS REQUIRED TO INCLUDE AS PART OF HIS END ITEM UNIT PRICE OR AS A SEPARATE CHARGE, ALL CHARGES FOR LOADING, BLOCKING, BRACING DRAYAGE, SWITCHING AND SUCH OTHER SERVICES AS MAY BE NECESSARY TO COMPLETELY PREPARE THE END ITEM FOR SHIPMENT. THIS PARAGRAPH FURTHER PROVIDES THAT THE FAILURE TO INCLUDE ALL SUCH CHARGES SHALL NOT BE MADE A BASIS FOR ANY CLAIM FOR ADDITIONAL MONIES. THE FOLLOWING PARAGRAPH "F" ALSO PROVIDES THAT EXCEPT FOR ANY CHARGES LISTED ALL COSTS WILL BE CONSIDERED AS BEING INCLUDED WITHIN HIS BID. THIS SAME THOUGHT AGAIN APPEARS IN PARAGRAPH "G.' IT IS CONCEIVABLE THEREFORE, THAT A BIDDER MIGHT WELL CHOOSE TO INCLUDE WITHIN HIS BID ALL SUCH CHARGES AND REFUSE TO QUOTE A SEPARATE LOADING CHARGE. SINCE THE INSTRUCTIONS SEEMINGLY PERMIT SUCH ACTION, HIS BID COULD NOT BE REJECTED ON THIS BASIS ALONE. SIMILARLY, WHERE, AS HERE, A BIDDER INSERTS A SMALL LOADING CHARGE, IT IS NOT ILLOGICAL TO ASSUME THAT A PORTION OF THE LOADING COSTS WERE INCLUDED WITHIN HIS BID. THIS SITUATION IS NOT UNLIKE THE CASE WHERE A BIDDER UNDERSTATES THE SHIPPING WEIGHT OF AN ITEM RATHER THAN REDUCE THE PRICE OF HIS BID. SEE B-154291, OCTOBER 6, 1964; AND B-153323, MAY 7, 1964.

DURING AN INFORMAL CONFERENCE HELD AT OUR OFFICE ON JUNE 2, 1965, WITH REPRESENTATIVES OF ATAC, THE ARGUMENT WAS ADVANCED THAT IN VIEW OF CEMSCO'S EXCEEDINGLY SMALL CHARGE FOR LOADING, THE BIDDER WAS IN A POSITION TO EITHER WITHDRAW HIS BID BY CLAIMING ERROR OR ASK FOR A PRICE INCREASE IN THE LOADING CHARGE IF HIS BID WERE ACCEPTED AS ORIGINALLY SUBMITTED. IT WAS ALSO SUGGESTED THAT WHILE A $1.00 LOADING CHARGE MIGHT APPEAR REASONABLE IF VIEWED ONLY AS AN OFFER TO LOAD THE VEHICLES IN AN UPRIGHT POSITION, IT COULD NOT BE REASONABLY VIEWED AS AN OFFER TO CHARGE $1.00 FOR INVERTED LOADING. CONCEDING THAT IT IS ALWAYS POSSIBLE FOR A BIDDER TO CLAIM ERROR, THE FACT REMAINS THAT THE BIDDER HAS CONSISTENTLY DENIED THE EXISTENCE OF AN ERROR IN HIS LOADING CHARGE. IT CANNOT BE SAID THAT A $1.00 LOADING CHARGE IS SO LOW AS TO PUT A CONTRACTING OFFICER ON NOTICE OF THE POSSIBILITY OF ERROR WHEN A BIDDER NEED NOT QUOTE ANY LOADING CHARGE AT ALL.

THE ADMINISTRATIVE FILE CONFIRMS THAT CEMSCO'S BID REMAINS LOW REGARDLESS OF WHETHER IT IS EVALUATED ON THE BASIS OF ITS COMMITMENT OR WHETHER THE GOVERNMENT INDEPENDENTLY DETERMINES THE LEAST EXPENSIVE MODE OF TRANSPORTATION. IN 43 COMP. GEN. 613, WE HAD OCCASION TO CONSIDER A SITUATION WHERE A BIDDER (DOC-0) INDICATED THAT HE WOULD LOAD 4 VEHICLES PER TRUCKLOAD OR 6 PER HEAVY HAULER WHEREAS A COMPETING BIDDER (ATLANTIS) OFFERED TO LOAD 8 VEHICLES PER TRUCKLOAD. THE PROCURING ACTIVITY AFTER COMPARING THE COSTS OF TRANSPORTATION CONCLUDED THAT DOC-O'S EVALUATED BID WAS HIGHER THAN THAT SUBMITTED BY ATLANTIS SINCE DOC-O WOULD REQUIRE TWICE AS MANY TRUCK SHIPMENTS AS ATLANTIS AND SINCE SHIPMENT BY HEAVY HAULER WAS NOT CONSIDERED FEASIBLE. AFTER CAREFUL DELIBERATION WE REJECTED THAT CONCLUSION, AND RECOMMENDED THAT DOC-O'S BID SHOULD BE EVALUATED ON THE BASIS OF SHIPPING 6 VEHICLES PER HEAVY HAULER.

WE BELIEVE THAT OUR PRIOR POSITION IS NOT ONLY REQUIRED BY 10 U.S.C. 2305/C) AND ASPR 1-1305, BUT IS EMINENTLY SOUND. THE BIDDER MUST DETERMINE HIS BID PRICE FOR THE ITEM AND EITHER AGREE TO ABSORB THE COST OF LOADING, OR STATE A LOADING FEE AS A SEPARATE CHARGE. OBVIOUSLY, IF WEIGHTS AND/OR DIMENSIONS OF THE INTENDED ITEM MAY VARY AMONG BIDDERS, THE PROCURING ACTIVITY WOULD HAVE A LEGITIMATE RIGHT TO ASK FOR THIS INFORMATION. IN THE PRESENT CASE, HOWEVER, THE GOVERNMENT KNEW THE EXACT WEIGHTS AND DIMENSIONS OF THE ITEM AND CONSEQUENTLY BIDDERS WERE NOT REQUESTED TO FURNISH THIS INFORMATION. THEREFORE, ONCE THE GOVERNMENT HAD BOTH THE ITEM BID AND LOADING CHARGE IT THEN ONLY NEEDED TO EVALUATE THE COST OF TRANSPORTATION ON THE BASIS STATED IN THE BID FROM THE BIDDER'S F.O.B. POINT OF ORIGIN TO THE DESTINATION NAMED IN THE INSTRUCTIONS.

IN THE PRESENT CASE THE FACTS SHOW THAT THE GUARANTEE OF LOADING 50 VEHICLES PER CONVENTIONAL CAR WAS CLEARLY IMPOSSIBLE. ON THE OTHER HAND, THERE IS NO PROHIBITION IN THE INVITATION AGAINST DELIBERATELY MAKING SUCH AN IMPOSSIBLE GUARANTEE, ANY MORE THAN THERE IS ANY PROHIBITION AGAINST GUARANTEEING A BELOW COST LOADING CHARGE OR AN IMPOSSIBLY LOW SHIPPING WEIGHT. AND THE FACTS CLEARLY INDICATE THAT THE BIDDER DELIBERATELY GUARANTEED THE LOADING OF 50 UNITS PER CONVENTIONAL CAR AT A CHARGE OF $1.00 PER UNIT, ALTHOUGH HE APPEARS TO HAVE BEEN IGNORANT AT THAT TIME OF THE FACT THAT A LOADING OF 50 PER CAR WAS IMPOSSIBLE. SINCE THE INVITATION PERMITS THE GUARANTEEING OF IMPOSSIBLE LOADING CHARACTERISTICS, WE CANNOT SAY THAT SUCH A GUARANTEE WOULD NECESSARILY PUT THE CONTRACTING OFFICER ON CONSTRUCTIVE NOTICE OF A POSSIBLE ERROR IN BID. IF IT BE DEEMED DESIRABLE TO PRECLUDE THE MAKING OF SUCH UNREALISTIC BIDS, THE REMEDY LIES IN THE SETTING OF MAXIMUM AND MINIMUM LIMITS BY THE GOVERNMENT IN THE INVITATION ITSELF. WE SEE NO SUBSTANTIAL DIFFERENCE BETWEEN THE PRESENT CASE AND ONE IN WHICH THE BIDDER GUARANTEES AN IMPOSSIBLY LOW SHIPPING WEIGHT. IN BOTH CASES THE BID AS MADE IS CAPABLE OF EVALUATION ON THE BASIS STATED.

IN THE PRESENT CASE, CEMSCO WAS LOW BIDDER ON THE BASIS OF 50 UNITS PER CONVENTIONAL CAR. IT MADE THAT OFFER DELIBERATELY, ON THE BASIS OF ITS OWN INTERPRETATION OF INFORMATION IT HAD RECEIVED FROM A CARRIER'S REPRESENTATIVE. THIS IS NOT THE TYPE OF "MISTAKE" WHICH PERMITS EITHER CORRECTION OR WITHDRAWAL, AND, INDEED, CEMSCO HAS NOT ALLEGED THAT IT DID NOT INTEND TO STATE PRECISELY WHAT IT DID IN ITS BID. ITS BID SHOULD, THEREFORE, HAVE BEEN EVALUATED ON THE BASIS IT BID. SO EVALUATED, IT WAS THE LOW BID, AND IT SHOULD HAVE BEEN ACCEPTED AS TO THE NON-SET-ASIDE HALF OF THE PROCUREMENT. THE AWARD OF THAT PORTION OF THE PROCUREMENT TO STEVENS MANUFACTURING COMPANY WAS THEREFORE INVALID.

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