BNUMBER: B-279575
DATE: June 29, 1998
TITLE: Boines Construction & Equipment Co., Inc., B-279575, June 29,
1998
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Matter of:Boines Construction & Equipment Co., Inc.
File:B-279575
Date:June 29, 1998
John I. Hulse IV, Esq., Hulse & Wanek, for the protester.
Jud E. McNatt, Esq., Department of Housing and Urban Development, for
the agency.
Adam Vodraska, Esq., and James A. Spangenberg, Esq., Office of the
General Counsel, GAO, participated in the preparation of the decision.
DIGEST
Bid in an envelope marked "BID ENCLOSED," which was hand-carried by
commercial carrier to the contracting agency's mailroom several hours
before bid opening but was not received by the contracting office
where the bid depository was located until after bid opening, was late
and not properly accepted for award; rather than government
mishandling being the primary or paramount cause of the lateness, the
mailroom's routing of the bid to another office in the same building
that also handles bids was attributable to the bidder's failure to
mark its commercial carrier-provided envelope as required by Federal
Acquisition Regulation sec. 52.214-5 when using a commercial carrier to
deliver a bid.
DECISION
Boines Construction & Equipment Co., Inc. protests the award of a
contract to Pierce Foundations, Inc. under invitation for bids (IFB)
No. B-FTW-00041, issued by the Department of Housing and Urban
Development (HUD), Fort Worth, Texas, for demolition of vacant
buildings and related site work at the Hillcrest Homes Apartments
public housing project in Larose, Raceland, and Thibodaux, Louisiana.
Boines contends that HUD should not have accepted Pierce's late bid.
We sustain the protest.
The IFB, issued December 30, 1997, incorporated by reference at L-1
the standard "Submission of Bids" provision, FAR sec. 52.214-5, which
instructs bidders to submit bids in sealed envelopes or packages (1)
addressed to the office specified in the solicitation and (2) showing
the time and date specified for receipt, the solicitation number, and
the name and address of the bidder. FAR sec. 52.214-5(a)(1), (2). The
provision states that bidders using commercial carrier services shall
ensure that the bid is addressed and marked on the outermost envelope
or wrapper as prescribed above when delivered to the office specified
in the solicitation. FAR sec. 52.214-5(b). The IFB also incorporated,
on its Standard Form (SF) 33 cover sheet and at L-1, the standard
"Late Submissions, Modifications, and Withdrawals of Bids" provision,
FAR sec. 52.214-7, which states, in relevant part, that any bid received
at the office designated in the solicitation after the exact time
specified for receipt will not be considered unless it is received
before award and, if it was hand-carried (including delivery by a
commercial carrier), it is determined by the government that the late
receipt was due primarily to government mishandling after receipt at
the government installation. FAR sec. 52.214-7(a)(2); see FAR sec.
14.304-1(a)(2).
The IFB's SF 33 cover sheet provided in Item (Block) 9 that sealed
bids "will be received at the place specified in Item 8, or if
hand-carried, in the depository located in 1600 Throckmorton, Fort
Worth, TX until 2:00 PM local time 01-30-98." Item 8 of the SF 33,
"ADDRESS OFFER TO (If other than Item 7)" was erroneously filled in as
"SAME AS BLOCK 6" ("REQUISITION/PURCHASE NO"), which was blank. Item
7, "ISSUED BY," specified the following office and address:
U.S. Dept. of Housing and Urban Development
Contracting Division, 6AAC
1600 Throckmorton (76102)
Fort Worth, TX 76113-2905
Amendment No. 1 to the IFB, issued January 28, 1998, extended the bid
opening date to February 9 at 2 p.m.
Six bids were received by the Contracting Division by the time of the
February 9 bid opening, including a bid from Boines. No bid from
Pierce was received. Immediately before the bid opening, Contracting
Division staff contacted the HUD mailroom to determine if any further
bids had been received but, according to the agency, "the answer was
negative." The agency explains that this inquiry was made because
commercial carriers, such as Federal Express, have been instructed to
deliver all items addressed to HUD to the mailroom regardless of the
person or office at HUD to which the item is addressed. At bid
opening, Boines's total bid of $1,196,620 appeared to be the low bid.
Shortly after bid opening, a representative from Pierce telephoned the
Contracting Division to inquire about the bid opening results, and
when told, alerted contracting personnel that Pierce's bid of
$1,120,921.16 had apparently been misplaced by the agency.
Contracting personnel then immediately contacted the HUD mailroom, and
learned that Pierce's bid had been delivered by Federal Express to the
mailroom that morning at 9:40 a.m., but was routed by a mailroom clerk
to the mailbox of the Single Family Real Estate Owned (SFREO) Branch,
which processes bids for the sale of houses owned by HUD, and that a
representative from the SFREO Branch had only minutes before picked up
that office's mail from the mailroom. Contracting personnel,
accompanied by the mailroom clerk, then went to the SFREO Branch and
retrieved the envelope containing Pierce's bid, as yet unopened, at
about 2:45 p.m.
The outermost envelope containing Pierce's bid was a Federal Express
envelope that was not marked with the solicitation number or the date
and time of bid opening, and exhibited no further delivery information
beyond what was on the Federal Express mailing label. The mailing
label was completed, in relevant part, as follows:
To
Recipient's NameBID ENCLOSED Phone (817) 978-9301
Company U.S. Dept. of Housing & Urban Development
Address 1600 Throckmorton Dept/Floor/Suite/Room [blank]
City Fort WorthStateTX ZIP 76102
The mailing label indicated that the envelope had been sent from
Pierce on Friday, February 6, via "FedEx Priority Overnight" for
delivery the next business morning, which was Monday, February 9. The
mailing label had been time/date stamped by the agency mailroom at
9:40 a.m. on February 9. The phone number on the mailing label was
that listed on the IFB's SF 33 cover sheet for the HUD contract
specialist.
Pursuant to FAR sec. 52.214-7, contracting personnel determined that the
late receipt of Pierce's bid was primarily due to mishandling by the
government after receipt at the government installation, and proceeded
to open the bid and record the amount on the abstract of offers.
Because Pierce's bid was $75,699 lower than the bid submitted by
Boines, HUD accepted Pierce's bid for award.
On February 13, Boines filed an agency-level protest of HUD's intended
award to Pierce, which the agency denied on March 10. Boines then
protested to our Office on March 20. The contract was awarded to
Pierce on March 24. On March 30, HUD executed a determination and
finding under FAR sec. 33.104(c)(2)(ii) to allow Pierce to perform the
contract, based on urgent and compelling circumstances that would not
permit awaiting a decision, including the deteriorated physical
condition of the buildings to be demolished, related security
considerations, and costs incurred pending demolition.
In its protest, Boines contends that Pierce's bid was improperly
considered for award by HUD under FAR sec. 52.214-7 because the lateness
of Pierce's bid was not primarily due to government mishandling, as
maintained by HUD, but to Pierce's own failure to ensure that the
outermost envelope of its bid was addressed to the office specified in
the IFB and marked with the solicitation number and date and time of
bid opening, as required for the submission of bids by FAR sec. 52.214-5.
In response to the protest, the contracting officer contends that,
since Pierce's bid was hand-carried by a commercial carrier, it was
correctly addressed in accordance with Item 9 of the IFB's SF 33 cover
sheet, which specified where hand-carried bids would be received,
namely "the depository located in 1600 Throckmorton, Fort Worth, TX."
As HUD did not further specify in Item 9 where in the building the
depository for hand-carried bids was located (it is actually in the
Contracting Division) and "has clearly instructed that all items
delivered by commercial carrier will be routed through the HUD
mailroom," the contracting officer argues that Pierce's bid was
delivered to the location designated in the IFB for hand-carried bids
prior to bid opening and thus timely received.
As a general rule, bidders are responsible for delivering their bids
to the proper place at the proper time, and late delivery of a bid
generally requires its rejection even if it is the lowest bid. J.C.N.
Constr. Co., Inc., B-270068, B-270068.2, Feb. 6, 1996, 96-1 CPD para. 42
at 3; Aztec Dev. Co., B-256905, July 28, 1994, 94-2 CPD para. 48
at 3. A bid is late if it does not arrive at the office designated in
the solicitation by the time specified. FAR sec. 14.304-1; Aztec Dev.
Co., supra. Normally, receipt at other places, such as the agency
mailroom, is insufficient. Inland Marine Indus., Inc., B-233117, Feb.
16, 1989, 89-1 CPD para. 165 at 3; J.E. Steigerwald Co., Inc., B-218536,
Apr. 19, 1985, 85-1 CPD para. 453 at 4.
Here, Pierce's bid is treated as having been hand-carried, since it
was delivered by a commercial carrier, Kelton Contracting, Inc.,
B-262255, Dec. 12, 1995, 95-2 CPD para. 254 at 3, and it was late because
it was not received in the depository, which the solicitation
designated as the place of receipt for hand-delivered bids, by bid
opening. Even though commercial carriers were instructed to bring
deliveries to the mailroom, the relevant time is the time of receipt
in the bid depository, not receipt in the mailroom, and, since
Pierce's bid arrived in the depository after bid opening, it was late.
See Weather Data Servs., Inc., B-238970, June 22, 1990,
90-1 CPD para. 582 at 2-4; Inland Marine Indus., Inc., supra, at 3.
Alternatively, HUD takes the position that, even if Pierce's
hand-carried bid was late, it was nonetheless properly considered
because the late receipt was due primarily to government mishandling
after delivery. Specifically, the contracting officer points to the
erroneous assumption by the mailroom that Pierce's envelope contained
a bid for the purchase of a house and should be routed to the SFREO
Branch. The contracting officer also states that the telephone number
for the HUD contract specialist entered on the mailing label of
Pierce's envelope "could have been used [by the mailroom] to identify
the package and to alert someone to pick-up this 'Priority Delivery.'"
The contracting officer asserts that had the SFREO Branch been
contacted sooner by the mailroom to pick up the package, the bid could
have easily been opened, found to belong to contracting division, and
then routed to contracting personnel prior to bid opening. According
to the contracting officer, "For a 'Priority Delivery' package to sit
in the HUD mailroom for approximately five hours without being
picked-up by someone . . . is clearly mishandling on HUD's part."
Late hand-carried bids, including those delivered by a commercial
carrier, may be considered, if it is determined that the late receipt
was due primarily to government mishandling after receipt at the
government installation. FAR sec. 14.304-1(a)(2), 52.214-7(a)(2);
Palomar Grading & Paving, Inc., B-274885, Jan. 10, 1997, 97-1 CPD para. 16
at 3; AABLE Tank Servs., Inc., B-273010, Nov. 12, 1996, 96-2 CPD para. 180
at 3.[1] However, a late bid should not be accepted if the bidder
significantly contributed to the late receipt by not acting reasonably
in fulfilling its responsibility for ensuring delivery to the
designated place for receipt by the proper time. Aztec Dev. Co.,
supra, at 3; John Holtman and Sons, Inc., B-246062, Feb. 13, 1992,
92-1 CPD para. 187 at 2; J.E. Steigerwald Co., Inc., supra, at 5.
Where the bidder fails to record required information as to the
solicitation number, deadline for receipt and ultimate destination on
the outside envelope provided by the commercial carrier, the bidder is
usually primarily responsible for any delay in delivery. See Systems
for Bus., B-224409, Aug. 6, 1986, 86-2 CPD para. 164 at 3-4. Here,
Pierce's failure to mark its commercial carrier-provided envelope as
required by FAR sec. 52.214-5 was the paramount reason for the delay
resulting from the mailroom's "misrouting" of its bid. Indeed, the
record suggests that the mailroom's routing of the bid to the SFREO
Branch rather than the Contracting Division was not "mishandling,"
given that the SFREO Branch--located in the same building--also
receives "bids" (albeit for the purchase of houses) and Pierce's
envelope, merely marked "BID ENCLOSED," did not indicate that it was
intended for the Contracting Division.
Due to Pierce's failure to mark the solicitation number and the bid
opening date and time on its envelope to indicate the imminent bid
opening, the mailroom clerk had no particular reason to expedite
delivery or to call the telephone number on the mailing label. There
is no evidence in the record that the mailroom personnel were required
or expected to take such action in the absence of a clear indication
that immediate attention was required. Pierce's use of overnight
delivery was not, in itself, sufficient notice to the contracting
agency that the material being delivered was a bid that must meet a
particular deadline. See S & W Enters., Inc., B-219716, Aug. 19,
1985, 85-2 CPD para. 192 at 3.
In sum, we find that the primary or paramount cause of the lateness of
Pierce's bid was not government mishandling, but rather Pierce's
failure to ensure that the outermost envelope of its bid was marked as
instructed by FAR sec. 52.214-5. Even if HUD contributed to the lateness
of Pierce's bid after delivery, we view this as incidental rather than
primary or paramount. See Imperial Maintenance, B-218614, July 26,
1985, 85-2 CPD para. 94 at 3. Accordingly, HUD's award of a contract to
Pierce does not comply with the regulatory standard for the
consideration of late hand-carried bids. FAR sec. 14.304-1(a)(2),
52.214-7(a)(2).
We recommend that HUD terminate its contract with Pierce, if feasible,
and award the contract to Boines, the next low bidder, if Boines's bid
is otherwise responsive and Boines responsible. 4 C.F.R. sec. 21.8(a)(2)
(1998). If termination of the contract with Pierce is not feasible
because of the extent of contract performance, we recommend that HUD
instead pay Boines its bid preparation costs. 4 C.F.R. sec. 21.8(d)(2).
Additionally, we recommend that HUD pay Boines the costs of filing and
pursuing its protest, including reasonable attorney's fees. 4 C.F.R. sec.
21.8(d)(1). In accordance with 4 C.F.R. sec. 21.8(f)(1), the protester's
certified claim for such costs, detailing the time expended and the
costs incurred, must be submitted directly to the agency within 60
days of this decision.
The protest is sustained.
Comptroller General
of the United States
1. When the provisions concerning the delivery of hand-carried bids by
commercial carriers were added to the FAR, effective March 3, 1997, it
was stated that the standards applied by the decisions of our Office
were to be applicable. FAC 90-44 (FAR case No. 95-019), Item
V-Consideration of Late Offers.