Quality Transport Services, Inc. v. United States

34 Cont. Cas. Fed. 75,264, 12 Cl. Ct. 276, 1987 U.S. Claims LEXIS 75
CourtUnited States Court of Claims
DecidedApril 28, 1987
DocketNo. 165-87C
StatusPublished
Cited by21 cases

This text of 34 Cont. Cas. Fed. 75,264 (Quality Transport Services, Inc. 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
Quality Transport Services, Inc. v. United States, 34 Cont. Cas. Fed. 75,264, 12 Cl. Ct. 276, 1987 U.S. Claims LEXIS 75 (cc 1987).

Opinion

OPINION

NETTESHEIM, Judge.

This pre-contract award action was commenced by plaintiff Quality Transport Services, Inc. (“plaintiff”), to enjoin award of a small business set-aside contract to the joint venture of intervenors/defendants M.R.W. International, Inc., and Zenith Van & Storage, Inc. (the “joint venture”). Defendant agreed to withhold contract award until the matter could be resolved on briefs. The parties, other than the joint venture which did not appear, were heard after the completion of briefing. The issue is whether the contracting officer abused his discretion or violated applicable regulations in determining to award a military “pack-and-crate” contract involving interstate carriage to a joint venture that does not hold in its own name motor carrier authority from the Interstate Commerce Commission (the “ICC”), although one co-venturer has ICC operating authority.

FACTS

The following facts are undisputed. The subject solicitation for a one-year contract, with option to extend, called for packing, crating, unpacking, uncrating, and drayage of shipments of used household goods for the Department of the Army’s Cameron Station, Alexandria, Virginia. Plaintiff is the incumbent contractor. Separate bidding was required for specified geographic areas. Area II, which is involved in this case, includes cities and counties in metropolitan Virginia adjacent to Washington, D.C., as well as Dulles International and Washington National Airports. Pickup and shipment extended to points within 100 miles of Area II and delivery to points within 300 miles thereof. Although pickup and delivery within the Washington, D.C. commercial zone are not considered movements in interstate commerce, the parties agree that the solicitation does call for some service in interstate commerce.

The solicitation included a clause mandated by 48 C.F.R. § 47.207-l(a) (1986) (Federal Acquisition Regulation, or “FAR”). Section 47.207-1, entitled “Qualifications of of-ferors,” provides:

[278]*278(a) Operating authorities. The contracting officer shall insert the clause at 52.247-2, Permits, Authorities, or Franchises, when regulated transportation is involved. The clause need not be used when a Federal office move is intrastate and the contracting officer determines that it is in the Government’s interest not to apply the requirement for holding or obtaining State authority to operate within the State.

FAR § 52.247-2, entitled “Permits, Authorities, or Franchises,” provides:

As prescribed in 47.207-l(a), insert the following clause in solicitations and contracts for transportation or for transportation-related services when regulated transportation is involved. The clause need not be used when a Federal office move is intrastate and the contracting officer determines that it is in the Government’s interest not to apply the requirement for holding or obtaining State authority to operate within the State.
(a) The offeror certifies that the offer- or does /_/, does not /_/, hold authorization from the Interstate Commerce Commission or other cognizant regulatory body. If authorization is held, it is as follows:
(Name of regulatory body)
(Authorization No.)
(b) The offeror shall furnish to the Government, if requested, copies of the authorization before moving the material under any contract awarded. In addition, the offeror shall, at the offeror’s expense, obtain and maintain any permits, franchises, licenses, and other authorities issued by State and local governments.

In its bid plaintiff certified that it holds operating authority to transport household goods in interstate and foreign commerce. In its bid the joint venture indicated that each of the entities held intra-Virginia motor carrier authority issued by the Virginia State Corporation Commission. Zenith Van & Storage, Inc. (“Zenith”), however, holds authority to move freight in interstate commerce, although the joint venture’s bid did not so indicate. Apparently, the contracting officer obtained this information from another source.

Before this court the joint venture took the position that it was not a legal entity (a proposition contested by defendant) and that the arrangement was the product of a verbal agreement that would be implemented if the joint venture were awarded the contract. The joint venture explained: “[T]wo carriers are jointly bidding, with an arrangement between them that provides for each to perform only the carriage for which it has authority in its own name____” Joint Venture’s Br. filed Apr. 10, 1987, at 10. An affidavit submitted in this proceeding by officers of M.R.W. International, Inc., and Zenith states:

When the Army’s Military District of Washington issued IFB No. DAHC30-87-B-0008 for pack-and-crate services, MRW and Zenith each made an assessment of their ability to bid on and obtain a contract for one or more of the geographic areas covered. A review of the Solicitation convinced each of us to pool our resources with another company in order to respond to this Solicitation. The officers of our two companies met and orally agreed to bid jointly on this Solicitation and to perform jointly any contracts we might receive from this Solicitation. We viewed the arrangement as a joint venture of two independent companies, and did not intend to create any new entity as such. The arrangement is limited solely to this procurement.

Joint Affidavit of Melvin D. Bailey and Alban J. Zolly, Apr. 17, 1987, ¶ 3.1

[279]*279The joint venture submitted a bid for $450,975, and plaintiff’s bid was for $551,-325.

On December 16, 1986, plaintiff protested to the contracting officer that the joint venture was not responsible because it did not hold the required ICC motor carrier authority to transport shipments in interstate or foreign commerce. The contracting officer denied the protest by letter of December 31, 1986, reasoning:

MDW, DCSACQ [Military District of Washington, Deputy Chief of Staff for Acquisitions] contacted the International [sic] Commerce Commission ... on 29 December, 1986 and was advised that the Virginia State Corporation Commission Certification held by both M.R.W. and Zenith is the proper authority to do intrastate business. In the event that services would be required on an interstate level, Zenith Van & Storage Co., Inc. possesses ICC authority based on a telephone conversation with Zenith on 17 December, 1986. ICC stated it was generally common and acceptable practice among business relationships similar to M.R.W.’s and Zenith’s for one company to possess an ICC authority while the other does not.
Therefore, the Contracting Officer has made the determination that the bid submitted by M.R.W. International, Inc. and Zenith Van & Storage Co., Inc. is respon-sive____

The decision reflects the substance of a telephone conversation of the contracting officer’s subordinate with the ICC employee.

After the contracting officer denied plaintiff’s protest, a protest was lodged with the General Accounting Office (the “GAO”) on January 7,1987, as supplemented on January 9, 1987.

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Bluebook (online)
34 Cont. Cas. Fed. 75,264, 12 Cl. Ct. 276, 1987 U.S. Claims LEXIS 75, Counsel Stack Legal Research, https://law.counselstack.com/opinion/quality-transport-services-inc-v-united-states-cc-1987.