Grade-Way Construction v. United States

32 Cont. Cas. Fed. 73,209, 7 Cl. Ct. 263, 1985 U.S. Claims LEXIS 1070
CourtUnited States Court of Claims
DecidedJanuary 16, 1985
DocketNo. 1-85C
StatusPublished
Cited by7 cases

This text of 32 Cont. Cas. Fed. 73,209 (Grade-Way Construction v. United States) is published on Counsel Stack Legal Research, covering United States Court of Claims primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Grade-Way Construction v. United States, 32 Cont. Cas. Fed. 73,209, 7 Cl. Ct. 263, 1985 U.S. Claims LEXIS 1070 (cc 1985).

Opinion

[265]*265OPINION

YANNELLO, Judge.

Plaintiff is the second lowest bidder and intervenor the lowest bidder. Plaintiff protests any award to intervenor on the grounds that its bid is not responsive to the solicitation as amended.

In a stipulation filed on January 9, 1985, the parties agreed to many of the facts in this case. They need not be restated in detail here. However, in view of the rather interesting turn this case has taken, it is well to begin this opinion with a brief statement of some of the general principles of the law of government contracts as they apply to contract award.

It is an obvious precept that a contract can be awarded only to a bidder who fully responds to the government invitation for bids (“IFB” or “solicitation”). See, e.g., Federal Acquisition Regulation (FAR) § 14.301. If the government solicits bids to supply pens, it cannot award the contract to a bidder who offers pencils. The non-responsive bidder has not offered or agreed to a contract based on the solicitation, but rather has made a counter-proposal. In the context of competitive bidding, if the government finds such a counter-offer to be acceptable it must withdraw or cancel the original solicitation and issue a new IFB allowing all interested parties to submit bids on revised terms. Any principle to the contrary would result in unfairness to the other responsive bidders (those who offer to supply pens) and would violate the very purposes and the integrity of the system of competitive bidding.

This rule has exceptions. Where the defect or omission in the non-responsive bid is trivial or a matter of a mere formality, the law does not require that the entire bid be rejected. Rather, pursuant to the Federal Acquisition Regulations FAR § 14.405, and under the particular circumstances specified therein, a bidder may be given an opportunity to cure the defect or the government may waive those terms to which the bid does not respond.

The next rule (flowing from the first but perhaps not as obvious) is that the government cannot compel a bidder who is not responsive to the solicitation to accept an award of the contract in the precise terms of the solicitation. That is to say that a bidder cannot be compelled to accept a contract to perform work or incur costs under terms other than those in the IFB to which it has responded and agreed. This principle is self-evident in circumstances where a bid fails to respond to a material item in an IFB. It is perhaps less clear, although nonetheless equally applicable where the defect which renders the bid non-responsive concerns a relatively minor or minimal item of the solicitation.

Where the deviation from the solicitation is a minor informality or a matter of mere form, FAR § 14.405 provides only that the bidder may be given an “opportunity to cure” the defect or omission in its bid, and thus to enter into a contract precisely and entirely in accord with the solicitation. In its normal and everyday meaning, this phraseology connotes consent by the bidder to be so bound. The court found no authority which would permit the government to compel such curative action, leading to contract award and performance, even where a triviality is concerned. And although advised of the court’s interest in this line of inquiry, none of the parties here has provided any authority to support the proposition that such compulsion would be appropriate. Thus, if the bidder elects not to cure the defect, the terms of the solicitation to which it did not respond would be waived by the government in any contract awarded pursuant to that IFB.

A third principle upon which competitive bidding is founded is that a bidder generally should not be permitted any option to reaffirm, change, or withdraw its bid after the bids are opened and it has had an opportunity to see the other bids. (The exceptions to this rule in the event of clear mistake and clerical error are discussed in FAR § 14.406, concerning correction or withdrawal of the bid.) The reasons for [266]*266this rule are, of course, obvious. As a consequence of this rule, any circumstances or procedures which may allow such options are to be closely examined.

One such circumstance occurs in the context of non-responsive bids. Where the defect or omission is material, the bid is rejected by the government as non-responsive, and the bidder is given no option to make a correction and stay in contention for contract award. Where the defect is trivial or a matter of mere formality, however, FAR § 14.405, affords the bidder an “opportunity to cure.” As noted above, this provision connotes voluntary action by the bidder. Thus, this regulation must be carefully construed in order to prevent a situation wherein the bidder might, by failing to agree to cure the minor defect, effectively elect to have its bid cast out as non-responsive. The regulation itself addresses this problem by providing that in lieu of correction by the bidder, the merely trivial terms not responded to may be waived by the government and omitted from the contract. (Indeed FAR § 14.405 gives to the government, in its own best interest, the option of permitting cure by the bidder or waiver by the government.) It must be concluded that if the defect is one which the government cannot waive, FAR § 14.405 cannot apply. If not waivable, the defect cannot be deemed trivial and the bidder cannot alone determine (by electing or failing to cure the defect) whether its bid will survive (as cured and responsive) or, in effect, be withdrawn as defective, uncured, and non-responsive.

With this background in mind, we turn to the instant case. Here, the initial solicitation was amended. In order to assure that bids were responsive not only to the original IFB but to the amended terms as well, the bidders were required to acknowledge receipt of each amendment. The lowest bidder (intervenor herein, referred to as B, B & B) failed to acknowledge amendments 5 and 6; plaintiff acknowledged all amendments.

In addition to the general language discussed above, FAR § 14.405(d) provides that failure to acknowledge an amendment is a minor irregularity (not vitiating its responsiveness) only if:

(1) The bid received clearly indicates that the bidder received the amendment, such as where the amendment added another item to the invitation and the bidder submitted a bid on the item; or
(2) The amendment involves only a matter of form or has either no effect or merely a negligible effect on price, quantity, quality, or delivery of the item bid upon.

The first of these provisions, subparagraph (1), is not in issue here inasmuch as there is neither allegation nor evidence that acknowledgement of either of the two amendments was ascertainable from intervenor’s bid itself.

The second of these provisions, subparagraph (2), is the focus of the parties’ presentation. The parties agree that when examining price, consideration should be given to the cost attributed to the amendment itself, the total bid price, and the comparison with other bidders. Plaintiff alleges that the effect of each of these amendments upon its bid was significant or, in any event, not negligible. Intervenor alleges that the effect of amendment 5 upon its bid would be not only negligible and trivial (or de minimis), and that the amendment has no effect whatever. While these allegations (and the evidence introduced in support thereof) will be the subject of further discussion, some important observations are appropriate at the outset.

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Cite This Page — Counsel Stack

Bluebook (online)
32 Cont. Cas. Fed. 73,209, 7 Cl. Ct. 263, 1985 U.S. Claims LEXIS 1070, Counsel Stack Legal Research, https://law.counselstack.com/opinion/grade-way-construction-v-united-states-cc-1985.