Excavation Construction, Inc. v. United States

494 F.2d 1289 | Ct. Cl. | 1974

Per Curiam :

This case comes before the conrt on plaintiff’s exceptions to a recommended decision filed September 28, 1973, by Trial Judge Saul R. Gamer, Chief of the Trial Division, pursuant to Rule 134(h). The court has considered the case on the briefs and oral argument of counsel. Since the court agrees with the recommended decision, as hereinafter set forth, it hereby affirms and adopts the same as the basis for its judgment in this case. Therefore, plaintiff is not entitled to recover and the petition is dismissed. [See Keco Industries. Inc. v. United States, 203 Ct. Cl. 566, 492 F. 2d 1200 (1974).]

OPINION OF TRIAL JUDGE

Gamer, Trial Judge:

The Architect of the Capitol invited bids for the performance of the excavation and foundation work on the James Madison Memorial Building, Library of Congress project, and plaintiff was the second lowest bidder. Contending that the low bidder’s bid contained disqualifying irregularities which made plaintiff entitled to the award, that plaintiff apprised the Architect of such defects in the low bid, but that the Architect nevertheless arbitrarily and capriciously proceeded to award the contract to the low bidder, plaintiff sues to recover its damages, including loss of profits, in the alleged amount of $950,000.

It is settled that in cases of this kind this court will not award recovery of lost profits. The damages cannot exceed bid preparation costs. Heyer Products Co. v. United States, 135 Ct. Cl. 63, 69, 140 F. Supp. 409, 412 (1956); Keco Industries, Inc. v. United States, 192 Ct. Cl. 773, 784, 428 F. 2d 1233, 1240 (1970). And, while “[f]inal decisions should be based on the particular circumstances of each case” (Keco Industries, Inc. v. United States, 192 Ct. Cl. at 784, 428 F. 2d at 1240), even such recovery by the aggrieved bidder is dependent upon a showing of arbitrary and capricious action by the Government in awarding the contract to another and thus failing to give honest consideration to the disappointed bidder’s bid. Keco Industries, Inc. v. United States, supra. Furthermore, “the standard of proof to be applied in cases where arbitrary and capricious action is charged should be a high one.” Keco Industries, Inc. v. United States, 192 Ct. Cl. at 784, 428 F. 2d at 1240. “[X]n order to establish that the decision was arbitrary and capricious,” the aggrieved bidder “must show that there was no reasonable basis for the decision” of the responsible Government official to award the contract to someone else. Continental Bus. Enterprises, Inc. v. United States, 196 Ct. Cl. 627, 637-38, 452 F. 2d 1016, 1021 (1971); cf. M. Steinthal & Co. v. Seamans, 455 F. 2d 1289 (C.A.D.C.1971).

In this case plaintiff, in its attempt to establish such arbitrary and capricious action, has not been able to meet this high standard of proof.

The bid invitation in question was the second issued for this project. The first was issued on December 1, 1970, the project thereunder being identified as “Job No. 7093,” and the requirements of the Davis-Bacon Act¹ concerning minimum wages to be paid to laborers and mechanics being made applicable to the project. Plaintiff submitted a bid pursuant to this invitation. However, no award was made. The low bidder was Henry A. Knott, Inc., but upon the bid opening on January 15, 1971, the second low bidder (not the plaintiff) filed a protest against the award of the contract to Knott, resulting in the award being held up pending the resolution of the protest. Furthermore, on February 23, 1971, the President issued a Proclamation ² suspending the application of the Davis-Bacon Act to Federal contracts. Since the bids that had been submitted were based upon the application of the Act, the Architect of the Capitol decided that no award would be made on Job No. 7093 and that the invitation would be reissued, with the Davis-Bacon Act specifically being made inapplicable to the proposed contract.

Accordingly, on March 8,1971, the Architect invited new bids for the excavation and foundation work. Such project this time was designated as “Job No. 7117.” Bids were to be opened on April 22,1971.

However, on March 29, 1971, the President, by another Proclamation,³ revoked the suspension of the application to Federal projects of minimum wage rates required by the Davis-Bacon Act.

Thereupon, the Architect, on April 5, 1971, amended the outstanding invitation by issuing “Addendum No. 1,” which served to make the Act applicable to the project, and, on April 13, 1971, issued “Addendum No. 2,” which made certain additions to the Davis-Bacon Act provisions added by Addendum No. 1.

On Thursday, April 22,1971, the bids were opened. Three bids were submitted and again Knott was the low bidder. This time plaintiff was the second low bidder.

On the morning of the following day, Friday, April 23, 1971, an official of the plaintiff was permitted to examine the bids of the other two bidders. He was particularly desirous of ascertaining whether there were such defects in Knott’s bid as to cause its disqualification, thus resulting in plaintiff’s advancing to the position of low bidder. The examination was made in the office of Mr. Robert W. Kneesi, the Head of the Contracts and Specifications Division, Office of General Counsel.

Upon completing his examination, plaintiff’s official informed Kneesi that he had discovered two defects in Knott’s bid. The first related to Addendum No. 1. The cover sheets on the two addenda issued required bidders, in submitting their bids, to acknowledge their receipt, “giving the addendum number and its date.” Knott’s bid did acknowledge receipt of both addenda, but its acknowledgment of the first referred to it as “Addendum No. 1 dated March 8, 1971.” However, its proper date was, as above shown, April 5,1971. March 8, 1971, was, instead, the date of the Invitation for Bids. The Addendum had also referred to the March 8,1971 date since it was such invitation (and the documents issued together therewith) that the Addendum was amending.

The second error related to the bid bond. Bidders were required to submit with their bids a guaranty, which could take the form of a bid bond of at least 10 percent of the bid, to insure execution of the contract and of performance and payment bonds. Knott had submitted such a bond, executed by itself as principal and the Planet Insurance Company as surety. The form on which the bond was executed contained a space, under the heading “Bid Identification,” in which the “Invitation No.” was to be inserted. In this space, there had been inserted “7093.” As above shown, however, that had been the job number by which the first Invitation for Bids had designated the project. The correct designation of the project under the reissued second invitation was, as stated, Job No. 7117.

In response to an inquiry by Kneesi, who expressed the opinion that the two errors mentioned were minor informalities that would constitute an insufficient basis upon which to predicate a protest, plaintiff’s representative stated that he intended to report his findings to other officials of plaintiff and that he did not know what, if any, action plaintiff would take with respect to the matter.

On Monday, April 26, 1971, another official of the plaintiff hand delivered a protest letter to the offices of the Architect of the Capitol. A copy of the letter was also submitted to the Comptroller General on the same day. At that time plaintiff did not know that during the late afternoon of Friday, April 23, 1971, the same day that plaintiff’s official had earlier discovered the errors in the Knott bid and had reported them to Kneesi, the Architect of the Capitol had awarded the contract to Knott, and Knott had already executed the contract on April 26, 1971, prior to the filing of the protest.⁴

Upon learning these facts shortly thereafter plaintiff, feeling it was useless to press its protest against an award that had already been made, withdrew it and on May 14, 1971, filed the instant suit. It contends that the action of the Architect in so swiftly making the award to Knott prior to a definitive resolution by the Comptroller General of the effect of the defects in Knott’s bid which plaintiff had discovered and pointed out to the Architect’s representative, amounts to a discriminatory failure to give its bid the fair consideration that it merited.

From plaintiff’s point of view, its feeling that the action of the Architect was, under the circumstances, unfairly precipitate, is understandable.⁵ However, a consideration of the problems with which the Architect was faced at the time, and the reasons why he took the action he did, as testified to by the Architect himself, make plain that his action was neither arbitrary nor capricious.

First, the construction of the Madison Building was designed to be accomplished in four separate stages. The stage covered by the instant Invitation for Bids for the performance of the excavation and foundation work was the first. The commencement of the work on each of the three subsequent stages — the furnishing of the stone and marble, the construction of the superstructure, and the final finishing work and preparation for occupancy — was dependent upon the progress of the prior stage. The delay that had already been caused by the failure to make a letting under the first invitation and the necessity of re-advertising the first stage had set the construction schedule behind by approximately 3 months. Because of the rate of inflation then being experienced in the construction industry, the Architect felt that the longer the later stages were delayed the more expensive the entire project would become. For these reasons, the Architect was particularly interested in expediting the making of the award and the giving of the notice to proceed to the successful bidder as promptly thereafter as possible.

Second, as soon as the bids were opened on April 22,1971, and ICnott was revealed to be the low bidder, a Knott representative informed the General Counsel of the Architect of the Capitol of an impending strike in the steel industry. He suggested that if the Architect intended to make the award to his firm, the sooner the award was made, the sooner Knott could lilacs its orders for the required steel materials, including the steel for bracing. For this reason, to the form of letter of award that had been prepared in advance of the opening— a standard procedure designed to expedite the mechanics of the letting of the contract after the bid opening — there was added to the Knott letter that it was “authorized at this time to proceed with placing your procurement orders for such steel as you require for the performance of your contract.”

Third, there was special concern about eliminating as quickly as possible the annual outlay of approximately $2,000,000 for rental of space that would be given up as soon as the Madison Building became available for occupancy.

The errors in the Knott bid which plaintiff’s representative pointed out to Kneesi on the morning of April 23,1971, were in fact promptly reported to the Architect and considered by him before he made the award the afternoon of the same day. Kneesi immediately informed the General Counsel, Mr. F. W. Winkelmann, who in turn promptly advised the Architect (who, in addition to being an architect and engineer, was also a lawyer). Kneesi, Winkelmann and the Architect agreed that the two defects in question were in the nature of minor informalities which the Architect could waive. A paragraph of the “Bidding Conditions” which formed a part of the Invitation for Bids specifically provided that “the Government reserves the right * * * to waive any informalities in bids received whenever such rejection or waiver is in the interest of the Government.”

As to the use in the acknowledgment of the receipt of Addendum No. 1 of the incorrect date of the Addendum, they felt that the error was sufficiently cured by the proper acknowledgment of Addendum No. 2. Since all that Addendum No. 2 did was to amend Addendum No. 1 by adding certain provisions to the Davis-Bacon Act article added to the contract by Addendum No. 1, they felt that a proper acknowledgment of Addendum No. 2 plainly served to indicate the receipt of Addendum No. 1.

As to the error in the second bid bond’s use of the job number by which the first Invitation for Bids designated the project, they felt that, in view of the fact that the second bond reflected the correct bid opening date for the project to which the bond related, there could be no question concerning the identification of the project to which the bid bond related and that neither Knott nor the surety could use the error as a basis for withdrawing. The same surety had been on the bid bond that Knott had submitted under the first invitation, and the same attorney-in-fact for the surety had executed both bonds.

However, despite the unanimity of opinion, the Architect felt that, before he made the award to Knott, Winkelmann should discuss the matter with an appropriate official of the General Accounting Office. Thereupon, Winkelmann contacted Mr. Robert H. Rumizen, the Assistant General Counsel of the General Accounting Office, in charge of the Procurement Law Section, Office of the General Counsel. The responsibilities of this Section included the handling of bid protest matters and the making of recommendations for final decisions with respect thereto by the Comptroller General. After explanation by Winkelmann of the two defects, Rumizen agreed that both errors were waivable minor informalities.⁶

Upon being advised of Rumizen’s opinion, the Architect decided to waive the two errors as minor informalities and, as previously intended for the reasons indicated, to proceed with the making of an immediate award to the low bidder.⁷ Thereupon, he executed the letter of award, which was dispatched that same afternoon. At that time it was not known whether plaintiff would in fact file any formal protest.

Certainly, considering all the facts and circumstances, there can be no question of the bona ftdes of the Architect’s action. There is no basis for any conclusion that plaintiff was the subject of arbitrary and capricious discrimination.

Plaintiff differs with the Architect as to the propriety of considering the errors in the Knott bid as waivable minor informalities, placing particular reliance upon the bid bond error. Plaintiff argues that the use of the wrong job number constituted a fatal misidentification of the project, which served to invalidate the bond. It is not necessary, however, to decide what the result of a law suit would be in the event of an attempted disavowal of the bond by either the principal or the surety. The problem is instead, whether the Architect was arbitrary and capricious in concluding that the error was a waivable minor informality. This was a matter of judgment which the Architect certainly did not exercise unreasonably. There is no statute or regulation that would make illegal or improper the acceptance of a bid backed by a bid bond containing an error such as was here involved. It is not every bid deviation or error which automatically compels a bid rejection. Albano Cleaners, Inc. v. United States, 197 Ct. Cl. 450, 455 F. 2d 556 (1972). In the language of the court in Continental Bus. Enterprises, Inc. v. United States, supra, plaintiff has, considering the nature of the errors in the Knott bid upon which it is relying, failed to “show that there was no reasonable basis for the decision” of the Architect.⁸

Plaintiff contends the Architect should have awaited a formal ruling from the Comptroller General before making the award, or at least, after plaintiff filed its protest, before issuing the notice to proceed. But again plaintiff points to no statute or regulation which would prevent the Architect from awarding a contract under such circumstances as are here involved without first obtaining a formal decision from the Comptroller General. Cf. the Federal Procurement Regulations issued under the Federal Property and Administrative Services Act,⁹ which provide that contracting agencies covered by the Kegulations (the Architect of the Capitol being specifically excluded, 41 CFR §1-1.203 (1972)) need not withhold awards pending final disposition by the Comptroller General of protests. Under § 1-2.407-8 (b) (4) of the Regulations, the contracting officer may, despite the receipt of a protest, nevertheless make the award if he determines that “[t]he items to be procured are urgently required,” or “[d]elivery or performance will be unduly delayed by failure to make award promptly,” or “[a] prompt award will otherwise be advantageous to the Government.” 41 CFR § 1-2.407-8 (b) (4).¹⁰ Section 2.407-8 (b) (3) of the Armed Services Procurement Regulations is identical. 32 CFR § 2.407-8 (b) (3). Section 20.4 of the General Accounting Office Regulations also permits the making of an award despite the filing of a protest where “factors * * * will not permit a delay * * * .” 4 CFR § 20.4 (1973). 3h this connection, the General Accounting Office will consider protests not only against a proposed award, but also against awards already made (4 CFR § 20.1) so that had plaintiff not withdrawn its protest, it apparently could have received a decision from the Comptroller General despite the fact that the Architect made the award before plaintiff filed its protest. The Comptroller General has ruled that awards made were improper and that contracts executed pursuant thereto should be cancelled. See John Reiner & Co. v United States, 163 Ct. Cl. 381, 325 F. 2d 438 (1963), cert. denied 377 U.S. 931 (1964); Albano Cleaners, Inc. v. United States, supra.

For all of the reasons hereinabove set forth, plaintiff is not entitled to recover.

FINDINGS OK FACT

1. Plaintiff is a Maryland corporation engaged in the construction business. Its principal place of business was at all times relevant herein, located in Riverdale, Maryland, and it was, at all such times, qualified to do business in the District of Columbia.

2. By an Invitation for Bids dated December 1,1970, the Acting Architect of the Capitol, Mario E. Campioli, invited lump sum bids for the furnishing of all labor, equipment and materials and performing all work necessary for the excavation and foundation for the Library of Congress, James Madison Memorial Building, Washington, D.C. Included in the invitation were a statement of Bidding Conditions, a Bid Form, a Bidder’s Qualification statement, a form of the Construction Contract to be entered into, statements of General Conditions and Special Provisions, and detailed specifications governing the work. The bids were to be opened on January 15,1971. The work contemplated by this invitation was designated as “Job No. 7093.” Plaintiff submitted a bid.

3. Prior to the issuance of the December 1,1970 invitation for bids, the Architect of the Capitol had determined that construction of the Madison Building would be accomplished in four separate stages: (1) the excavation and foundation; (2) the furnishing of stone and marble; (3) the construction of the superstructure; and (4) the final finishing and preparation for occupancy. The timing for the award of contracts and the commencement of the work on each stage subsequent to the first was to be determined by the progress on the prior stage.

4. The bids submitted on Job No. 7093 were opened on January 15,1971, and Henry A. Knott, Inc. was determined to be the low bidder. On the same day, and prior to award of the contract, Blake Construction Co., Inc., the second low bidder, sent a telegram to the Acting Architect protesting any award of the contract to the low bidder. The record does not disclose the grounds of the protest. Further proceedings by the Acting Architect with respect to the award of the contract were suspended pending a ruling on the protest by the Comptroller General, except that the Acting Architect did proceed with the making of a pre-award investigation to determine whether Knott was qualified. The investigation revealed that Knott was an experienced construction company with adequate finances.

5. On January 27, 1971, Mr. George M. White was appointed Architect of the Capitol.

6. While the award of the contract for the Madison Building was still pending, the President of the United States, on February 23, 1971, issued Proclamation 4031 (36 F.R. 3457) suspending the application of Davis-Bacon Act (40 U.S.C. § 276(a) (1970)) Tmi-mnnnm wage provisions from federal contracts. The invitation for bids for the proposed Madison Building contract had included provisions requiring the application of the Davis-Bacon Act, and the bids submitted pursuant thereto were based upon the application of the Act to the project. The Architect of the Capitol was, upon the issuance of the proclamation, advised by the Department of Labor that proposed contracts which included Davis-Bacon Act provisions should not be awarded. The Architect of the Capitol thereupon decided to make no award on Job No. 7093 and to reissue the invitation for bids.

7. (a) By an Invitation For Bids dated March 8, 1971, issued by the Architect of the Capitol, lump sum bids were again invited for the performance of the excavation and foundation work for the Library of Congress James Madison Memorial Building. The work contemplated by this invitation was identified as Job No. 7117. Bids submitted pursuant to this invitation were to be opened on April 22,1971. As was the situation on the original invitation, the form of contract to be entered into showed that the Architect of the Capitol would be the contracting officer.

(b) There were several changes in construction requirements effected by the project drawings issued under this invitation. However, these changes to the original contract drawings issued under the previous invitation of December 1, 1970, and shown on 15 of the reissued drawings, were of a routine nature, such as changing the sizes of certain pipe sleeves, making certain other changes in dimensions, and certain changes in drawing details, including those pertaining to expansion joints, and would not affect significantly the cost of the work to be done under the contract.

(c) There were also some changes made in the other materials that were issued together with the second invitation. These included a revised form upon which bidders were to list their subcontractors; a revised definition of “Subcontractors” contained in the Special Provisions; a new article in such Provisions making the Davis-Bacon Act inapplicable to the contract, in accordance with the Proclamation of the President; an additional “Permits to proceed” article in such Provisions concerning the making of restoration deposits with the District of Columbia to insure payment for cost of possible damage; and a new “Lateral pressure assumptions” article in the “Excavation, Sheeting, Bracing, and Backfill” section of the specifications which set forth a reproduction of the work sheet of the Consulting Engineers on the project showing “the complete lateral pressure assumptions upon which the design of the excavation bracing system is based,” such reproduction being set forth “for informational purposes.” These changes too were not of such a nature as to affect significantly the cost of the work to be done under the contract.

(d) Paragraph 12 of the Bidding Conditions provided that “The Government reserves the right to reject any and all bids, and to waive any informality in bids received whenever such rejection or waiver is in the interest of the Government.” The identical provision had been included in the Bidding Conditions issued with the first invitation.

(e) Under the form of Bid required to be submitted, bidders agreed that the Architect of the Capitol could accept the bid “within sixty (60) days after the date of opening of the bids (if no shorter period be specified by the bidder) * * *.” This provision too was in the Bid form issued with the original invitation.

8. On March 29,1971, the President, by Proclamation No. 4040, revoked the suspension of the application of the minimum wage rates required by the Davis-Bacon Act (36 F.Ii. 6335).

9. (a) On April 5, 1971, the Architect of the Capitol issued “Addendum No. 1 to the Specifications Dated March 8, 1971 for the Excavation and Foundation for the Library of Congress James Madison Memorial Building Washington, D.O.” The addendum deleted the article (2-35) in the Special Provisions which made the Davis-Bacon Act inapplicable to the contract (thereby automatically reinstating a prior article making tbe Act applicable) and substituted therefor an article headed “Minimum Wage Rates,” setting forth the minimum basic hourly wage rates and fringe benefit payments to be paid to all mechanics and laborers employed on the project. In addition, the addendum (a) corrected certain typographical errors in the General Provisions and the Specifications and (b) changed one sentence in the “Concrete Work-Testing” article of the Specifications which changed the time when the “concrete for cylinders” would be taken for testing from “after concrete has been placed in the work” to “during placement of concrete.”

(b) The cover sheet of the addendum stated “Important: Bidders must acknowledge receipt of this addendum on the Bid Form, giving the addendum number and its date.”

10. (a)- On April 13,1971, “Addendum No. 2 to the Specifications dated March '8, 1971,” for Job No. 7117 was issued by the Architect of the Capitol. This addendum stated that it added six paragraphs to the “Minimum wage rates” article (2-35) of the Special Provisions, “which was added by Addendum No. 1, dated April 5,1971 * * *.” These paragraphs were concerned with such matters as the classification of laborers and mechanics not specifically listed in Addendum No. 1; special benefits covered by collective bargaining agreements; apprentices and a definition of “fringe payments.”

(b) The cover sheet on this addendum contained the same acknowledgment requirement as was set forth on Addendum No. 1. ■ ' •■•bSSf

11. It was the standard procedure in Ithe office of the Architect of the Capitol to prepare in advance of the bid opening date the letter of award and the contract to be executed. This practice was adopted in order to expedite the mechanics of the letting of the contract after the bid opening. On this particular project, the Architect of the Capitol was especially interested in such expedition. The delay occasioned by the readvertising of the project had set the construction schedule behind by approximately 3 months, and, since this was only the first contract in a four-step procurement plan, its delay also held up the advertisement of and the awards on the future stages. Additionally, because of the rate of inflation then being experienced in the construction industry, it was felt that the longer the later stages were delayed, the more expensive the entire project would become. There was, furthermore, concern about eliminating as quickly as possible the annual outlay of approximately $2 million for rental for space that would be given up when the James Madison Memorial Building became available for occupancy.

12. In accordance with the terms of the Invitation for Bids, bids were opened on Job No. 7117 in the office of the Architect of the Capitol at 3 p.m. on Thursday, April 22, 1971. Of the three bids submitted, that of Henry A. Knott Co., Division of Knott Industries, Inc., was the lowest. This is the same firm that had submitted, under the name of Henry A. Knott, Inc., the low bid, pursuant to the Invitation for Bids for Job No. 7093. Plaintiff was the second low bidder on Job No. 7117.

13. Immediately following the opening of bids a representative of Knott informed Mr. E. W. Winkelmann, General Counsel of the Architect of the Capitol, who was present at the opening, of an impending strike in the steel industry. He suggested that if the Architect intended to award the contract to his firm, the sooner the award was made, the sooner Knott could place its orders for the necessary steel materials required for the construction work, including the structural steel for bracing. Also in attendance at the bid opening from the Staff of the Architect of the Capitol were Mr. Robert W. Kneesi, who was Head of the Contracts and Specifications Division, Office of General Counsel, and Mr. Robert E. Wilbert, the Assistant Head of such Division.

14. Since Knott had been determined to be a responsible and qualified contractor as a result of the recent pre-award survey conducted pursuant to Job No. 7093, another pre-award survey prior to awarding a contract to such firm for Job No. 7117 was not considered to be necessary.

15. (a) Early in the morning of Friday, April 23, 1971, Louis H. Zarfoss, plaintiff’s then Engineer and Secretary, telephoned Kneesi and requested permission to review the bid documents that had been opened on the preceding day. Kneesi consented and Zarfoss immediately came to Kneesi’s office for such purpose, arriving at around 9:30 a.m. Zarfoss was particularly interested in examining the Knott bid documents to ascertain whether there were any defects therein which might serve to disqualify Knott and thus make plaintiff the low bidder. Kneesi gave Zarfoss the bid documents of the other two bidders, excluding, however, the confidential bidders’ qualification statements.

(b) Upon completing his review, Zarfoss informed Kneesi that he had discovered two defects in the Knott bid papers, as follows:

1. As above shown, the cover sheets of the two addenda that had been issued required bidders, in submitting their bids, to acknowledge their receipt, “giving the addendum number and its date.” Knott’s bid acknowledged receipt of the two addenda but its acknowledgement of the first addendum referred to it as “Addendum No. 1 dated Mar. 8, 1971.” As indicated the proper date of the addendum was April 5, 1971. March 8, 1971 was the date of the Invitation for Bids and the documents annexed which Addendum No. 1 amended, which date was referred to in the Addendum.

2. The required Bid Bond, dated April 22, 1971, submitted by Knott, as principal, and the Planet Insurance Company of Philadelphia, Pennsylvania, as corporate surety, consisted of a form which contained a space, under the heading “Bid Identification,” for the insertion of the “Invitation No.” In this space there was inserted “7093.” As shown, that was the “Job No.” by which the first Invitation for Bids dated December 1, 1970, designated the Madison Building project, the second invitation designating the project as “Job No. 7117.” The bond was executed by Mr. Charles J. Farr, 'Knott’s Executive Vice President, and by Mr. L. A. Reichart, as Attorney-In-Fact for Planet Insurance Company. The Planet Insurance Company had also been the surety on the Bid Bond that had previously been submitted by Knott on the first invitation, and that bond was executed by the same two individuals.

(c) A discussion then ensued between Zarfoss and Kneesi concerning the defects Zarfoss discovered and the possibility of plaintiff’s filing a protest against the award of the contract to the low bidder, with Kneesi mentioning the delaying effect the first bid protest had upon the progress of the Madison Building project. Kneesi expressed the belief that tbe discrepancies to which. Zarfoss referred were in the nature of minor informalities and that he therefore doubted whether plaintiff had a sufficient basis upon which to file a protest. Zarfoss stated that he would report his findings to, and thereafter consult with, other officials of the plaintiff, and that he did not know what, if any, action would be taken by the plaintiff with respect to the matter.

16. After Zarfoss’ departure, Kneesi reported to Winkel-miann the defects in Knott’s bid that Zarfoss had discovered and Zarfoss’ intention to discuss with other officials of the plaintiff the matter of filing a protest against the award of the contract to the low bidder. Winkelmann and Kneesi then reviewed the three bids submitted to determine if there were any other discrepancies in the bids. Winkelmann expressed the opinion that the errors in Knott’s bid which Zarfoss found were minor informalities that could be waived, and ordered Kneesi to proceed with the preparation of the notice of award to Knott and the contract for signature by the Architect of the Capitol. That morning Winkelmann had, pursuant to his discussion the previous day with the Knott representative concerning the possibility of a strike in the steel industry, altered the draft of the notice of award which Kneesi had previously prepared in order to permit Knott to immediately order the steel required for the project. The award letter and the contract were prepared in final form for the Architect’s signature by the end of that morning.

17. After his conversation with Kneesi, Winkelmann brought the matter to the attention of White, the Architect of the Capitol. In addition to being an engineer and an architect, both of which he actively practiced, White was also a lawyer, in the practice of which profession he had also engaged partially since 1960 and up to the date of his appointment. White expressed his belief that the irregularities Zarfoss had discovered were minor in nature, an opinion with which Winkel-mann expressed agreement. White felt, however, that, before the award was made, Winkelmann should contact an appropriate official of the General Accounting Office who handled and was familiar with bid protest matters to review the matter and to obtain his opinion concerning the propriety of the Architect’s making the award to Knott.

18. (a)' Thereupon, Winkelmann discussed the matter over the telephone with Mr. Bobert H. Bumizen, the Assistant General Counsel of the General Accounting Office in charge of the Procurement Law Section, Office of the General Counsel. The responsibilities of this section included the handling of bid protest matters and submitting them, together with recommendations, for final decision by the Comptroller General. Winkelmann informed Bumizen of the defects which had been discovered in the low bid for the Madison Building contract. He further advised that the Architect and he had concluded that the defects were minor in nature and that the Architect was prepared to waive them but that they first desired to check with the General Accounting Office to ascertain what their position was on the particular defects involved. Bumizen indicated that, in his opinion, the failure to provide the correct date in the acknowledgement of Addendum No. 1 was sufficiently cured by the proper acknowledgement of Addendum No. 2, which by its terms modified the Davis-Bacon Act article added to the contract by Addendum No. 1. As to the mistake in identifying the project by the old job number in the second bid bond, Bumi-zen agreed that it too was an informality which could be waived in view of the fact that the bond was executed by the same attorney-in-fact for the same surety who had executed the bid bond for the first job, and the fact that the bond reflected the correct bid-opening date.

(b) Telephone requests from government agencies seeldng guidance in such matters as were discussed between Winkel-mann and Bumizen were commonplace, but the practice was for the attorney in the section handling the call to make clear that the opinions expressed were only his personal ones, were not binding on the Comptroller General, and in no way affected what might be the ruling in the event of the filing of a subsequent bid protest.

19. On the afternoon of the same day, April 23, 1971, Winkelmann advised White of his conversation with Bumi-zen and the opinions Bumizen had expressed. Being in agreement with Bumizen and Winkelmann, White decided to waive, as minor informalities, the date and project number errors they had considered and to award the contract to Knott. White also relied on the previous investigation of Knott’s qualifications. Thereupon he executed the letter of award and the letter was mailed in the late afternoon. The letter, after stating that Knott would receive a formal notice to proceed with the work, went on to state that “You are, however, authorized at this time to proceed with placing your procurement orders for such steel as you require for the performance of your contract.” The contract and performance and payment ¡bonds were forwarded with the a/ward letter for execution by Knott and the surety. The contract was then to be returned for execution by the Architect.

20. On Monday, April 26,1971, a representative of Knott visited the office of the Architect of the Capitol and executed the contract on behalf of Knott.

21. Later that day plaintiff’s vice-president hand delivered a Bid Protest letter at the Architect’s office. A copy of the letter, which was dated April 26, 1971, was mailed to the Comptroller General. At that time plaintiff was not informed that an award had been made and the contract signed. The record does not indicate to whom the letter was handed nor with whom, if anyone, plaintiff’s vice-president spoke on this occasion. Plaintiff’s protest was based upon the aforementioned erroneous acknowledgement date of Addendum No. 1 and the erroneous project designation number in the bid bond. The letter stated that these errors made Knott’s bid “unresponsive to the terms of the Invitation for Bids,” and argued as follows:

The Invitation for Bids includes the following requirement at page xi:

'8. Bid guaranty. — (a) Bids shall be accompanied by a guaranty of not less than 10 percent (10%) of the amount of the bid to insure the execution of the contract, and of the performance and payment bonds as hereinafter provided. The guaranty may consist of a bid bond * * *.

Examination of the protested bid discloses that the corporate bid guaranty submitted does not identify the project, and contains only the designation “Invitation No. 7093”, which is not the identification of the project on which bids were opened on April 22nd.

In 1959, the Comptroller General ruled that the waiver of the requirements for a bid bond could no longer be condoned as a minor informality since this would have the tendency to compromise the integrity of the competitive bid system because it would be possible for a bidder, after the bid opening, to decide whether or not to have his bid rejected. 38 Comp. Gen. 532.

In considering the sufficiency of a bond, the test to be applied is whether the Government could enforce against the surety, the bond as submitted. It is only where the bond is enforceable against the surety that the bid may be considered. 39 Comp. Gen. 60 (1959). A clerical error by the surety, if such was the case here, will not operate to change the stated rule. 39 Comp. Gen. 827 (1960).

Further, the addenda to Invitation for Bids contain the following on the cover page:

IMPORTANT: Bidders must acknowledge receipt of this addendum on the Bid Form, giving the addendum number and its date.

The Invitation for Bids for Job. No. 7117, page xvi, also requires:

Acknowledge receipt of addenda, if any, stating each addendum number and its date:_

The protested bid contains a proper acknowledgement of receipt of Addendum No. 2 to the Specifications, but has failed to properly acknowledge Addendum No. 1, issued under date of April 5, 1971, by which minimum wage rates were added pursuant to the provisions of the Davis-Bacon Act. The protested bid incorrectly gives the date of Addendum No. 1 as March 8,1971.

The failure of the protested bid to correctly identify the project to which the bid bond is applicable would make it impossible for the contracting agency to hold the surety company legally liable and accordingly under the rule stated by the Comptroller General, requires the rejection of the bid.

Addendum No. 1 to the Invitation, which adds minimum wage rates as a part of the contract, substantially increases labor costs, and the price of performing this work. This, without more, requires the rejection of the subject bid. Unpublished 'Opinion of the Comptroller General, B-157832, November 9,1965.

Without any reflection on the integrity of Henry A. Knott, Inc., it must be noted that its failure to acknowledge this material addendum both by number and date, as required by the Invitation, and the failure of the bid bond to identify the project, placed this bidder in a position to decide, after opening of the bids, whether or not to have its bid rejected, and thus enabled it to obtain an undue bidding advantage.

By reason of these material deficiencies in the protested bid, it is urged that the bid of Henry A. Knott, Inc., must be rejected as unresponsive to material requirements of the Invitation for Bids, and the award must be made to the undersigned, as the bidder submitting the lowest responsive bid.

22. The contract was executed by the Architect of the Capitol on April 28 or 29, 1971, and notice to proceed was issued to Knott on April 30,1971.

23. Thereafter, the General Accounting Office acknowledged receipt of plaintiff’s bid protest and at the same time informed plaintiff of the fact that the award had already been made to Knott and the contract executed. In view of this information, plaintiff felt it would be fruitless to seek a cancellation of a contract already executed. Accordingly, on May 14, 1971, plaintiff filed its petition in this court and thereafter, since plaintiff was informed by an official of the General Accounting Office that it was not the policy of the Comptroller to issue decisions on matters in litigation, plaintiff felt no purpose would be served by its pressing the protest it had filed, and therefore withdrew it.

CONCLUSION OK LAW

Upon the foregoing findings of fact and opinion, which are adopted by the court and made a part of the judgment herein, the court concludes as a matter of law that plaintiff is not entitled to recover and the petition is dismissed.

1 40 U.S.C. § 276(a) (1&.70).

2 No. 4031, 36 Fed. Reg. 3457.

3 No. 4040, 36 Fed. Reg. 6335.

4 The Architect executed the contract on April 28 or 29, and notice to proceed to Knott was given on April 30,1971.

5 Under tlie terms of the Invitation for Bids, the Architect was given 60 days within which to make the award.

6 Telephone requests for guidance from Government agencies with respect to such matters as Winkelmann discussed were commonplace, although the practice was for the General Accounting Office official to make plain that the informal advice given was not binding on the Comptroller General and did not affect what his ruling might be in the event a bid protest was filed.

7 Knott’s qualifications as a responsible and qualified contractor had already been satisfactorily established as a result of the investigation that had been made on the first invitation.

8 38 Comp. Gen. 532, upon which plaintiff relies, is inapplicable. In that case, the bidder failed to submit any bid bond at all at the time of the bid opening. 39 Comp. Gen. 827, upon which plaintiff also relies, is also inapplicable. In that case the invitation required bid bonds in the amount of 2.0 percent of the contract price. The bond there in question was for only 10 percent. The Comptroller General held that the fact that the mistake was allegedly due only to clerical error was immaterial and that such failure to comply with the bid bond requirement represented a material deviation which could not be waived administratively.

On the issue concerning the addenda, see 34 Comp. Gen. 581, in which the bidder’s failure specifically to acknowledge addenda 1 and 2 that had been issued, was held to constitute an informality that could be waived where the bidder’s bid on an item that had been added by addendum No. 1, clearly indicated that he had received it, and where addendum No. 2 affected the cost of the work only to a negligible degree, if at all.

In its brief, plaintiff states with respect to the addenda issue that it “does not rely on the failure of the low bidder to properly acknowledge an addendum to the bid, standing alone, as being an irregularity that could not be waived, in the discretion of the Contracting Officer.”

9 41 U.S.C. §§ 251-60 (1970).

10 In this ease the Architect himself was the contracting officer.