91-002957BID Pre-Cast Specialties, Inc. vs. Palm Beach County School Board Status: Closed Recommended Order on Monday, June 24, 1991.

Summary: Bidder's failure to return 2 pages of Invitation To Bid was a minor irregularity that should have been waived by school board.

STATE OF FLORIDA

DIVISION OF ADMINISTRATIVE HEARINGS

PRE-CAST SPECIALTIES, INC., )

)

Petitioner, )

)

vs. ) CASE NO. 91- 2957BID

)

PALM BEACH COUNTY SCHOOL BOARD, )

)

Respondent. )

_________________________________)

RECOMMENDED ORDER

Pursuant to notice, a formal hearing was held in this case on May 28, 1991,

in West Palm Beach, Florida, before Stuart M. Lerner, a duly designated Hearing

Officer of the Division of Administrative Hearings.

APPEARANCES

For Petitioner: Fred A. Cianelli, Vice President

Pre-Cast Specialties, Inc.

5600 Northwest 72nd Avenue

Miami, Florida 33166

For Respondent: Robert A. Rosillo, Esquire

School Board of Palm Beach County

3970 RCA Boulevard, Suite 7010

Palm Beach Gardens, Florida 33410

STATEMENT OF THE ISSUES

Whether Respondent should sustain Petitioner's challenge to the preliminary

determination to reject Petitioner's bid as not responsive to Respondent's

Invitation to Bid No. SB 91C-284V and to award the contract to another bidder

that submitted a higher bid?

PRELIMINARY STATEMENT

By letter dated May 6, 1991, Petitioner filed a written protest contesting

Respondent's initial decision (1) to deem Petitioner's bid not responsive to

Respondent's Invitation to Bid No. SB 91C-284V because of Petitioner's failure

"to return [with its bid] page No[s]. 3 & 4 of [the] special conditions," and

(2) to award the contract to South Eastern Prestressed Concrete, Inc., instead

of Petitioner. On May 13, 1991, the matter was referred to the Division of

Administrative Hearings for the assignment of a Hearing Officer to conduct a

hearing on the matter.

Two witnesses testified at hearing: Betty Helser, Respondent's Director of

Purchasing; and Fred A. Cianelli, Petitioner's Vice President. In addition to

the testimony of these two witnesses, two exhibits were offered and received

into evidence: the bid submitted by Petitioner; and the bid submitted by South

Eastern Prestressed Concrete, Inc.

At the close of the evidentiary portion of the hearing on May 28, 1991, the

Hearing Officer announced on the record that post-hearing submittals had to be

filed no later than ten days following his receipt of the transcript of the

hearing. The Hearing transcript was filed on June 12, 1991. Respondent filed a

proposed recommended order on that same day. All of the findings of fact

proposed by Respondent in its proposed recommended order have been accepted and

incorporated in substance, although not necessarily repeated verbatim, in this

Recommended Order. To date, Petitioner has not filed any post-hearing

submittal.

FINDINGS OF FACT

Based on the record evidence, the following Findings of Fact are made:

1. On March 12, 1991, Respondent issued Invitation to Bid No. SB 91C-284V

(hereinafter referred to as the "ITB") through which Respondent solicited the

submission of bids to supply Respondent with prestressed concrete poles for a

one year period beginning May 16, 1991.

2. The ITB was a multi-page document with various component parts.

3. Bidders were instructed on the first page of the ITB to complete and

"RETURN ONE COPY OF ALL BID SHEETS AND THIS [BIDDER ACKNOWLEDGMENT] FORM."

4. They were advised elsewhere on the first page of the ITB that "[o]ne

copy of all bid documents that ha[d] page numbers, and this executed Invitation

to Bid [Bidder Acknowledgment] [F]orm [had to] be returned for the Bid to be

considered."

5. The advisement concerning the requirement that all numbered pages had

to be returned for a bid to be considered was repeated at the bottom of each

numbered page of the ITB.

6. Directly beneath the Bidder Acknowledgment Form on the first page of

the ITB was the following provision:

This Invitation to Bid, General Conditions,

Instructions to Bidders, Special Conditions,

Specifications, Addenda and/or any other

pertinent document form a part of this

proposal and by reference are made a part

thereof.

7. The ITB further provided, among other things, that "[i]n the best

interest of [Respondent], [Respondent] reserve[d] the right to reject any and

all bids and to waive any irregularity in bids received."

8. Petitioner and South Eastern Prestressed Concrete, Inc. (South Eastern)

submitted the only bids in response to the ITB.

9. In accordance with the ITB'S instructions, Petitioner completed and

returned to Respondent the Bid Summary Sheet, on which it indicated its price

offer. It also completed and executed the Bidder Acknowledgment Form and

returned it, along with the entire first page of the ITB, to Respondent.

10. Petitioner, however, failed to return, as part of its bid submittal,

all of the numbered pages of the ITB. Omitted from Petitioner's submittal were

numbered pages 3 and 4. These missing pages contained paragraphs A. through N.

of the ITB's Special Conditions, which covered the following subjects: A.

Scope; B. Delivery; C. Award; D. Term of Contract; E. Brand Name; F.

Catalog Cuts; G. Estimated Quantities; H. Bid Exempt; I. Bidders

Responsibility; J. Corrections; K. Joint Bidding, Cooperative Purchasing

Agreement; L. Withdrawal; 1/ M. Minority Certification Application; and N.

Public Entity Crimes.

11. There was nothing on numbered pages 3 and 4 of the ITB that the bidder

needed to fill out or sign. While paragraphs M. and N. of the ITB's Special

Conditions did make reference to certain forms that the bidder had to complete

and submit to Respondent, these forms did not appear on either numbered page 3

or numbered page 4. They were separate documents. Petitioner completed these

forms and submitted them to Respondent pursuant to the requirements of the

Special Conditions.

12. Petitioner did not propose in its bid submittal any contract terms or

conditions that were at variance with those set forth in paragraphs A. through

N. of the ITB's Special Conditions.

13. Petitioner did not intend to signify, by failing to return numbered

pages 3 and 4, any unwillingness on its part to adhere to contract terms and

conditions set forth on those pages.

14. Of the two bids submitted in response to the ITB, Petitioner's was the

lowest.

15. A preliminary determination, though, was made to reject Petitioner's

bid because Petitioner had not returned numbered pages 3 and 4 of the ITB and to

award the contract to South Eastern as the lowest responsive bidder. It is this

preliminary determination that is the subject of the instant bid protest filed

by Petitioner.

CONCLUSIONS OF LAW

16. District school boards in this State, with certain limited exceptions

not applicable to the instant case, are required to purchase commodities and

services through the process of competitive bidding. Section 237.02(2), Fla.

Stat.; Fla. Admin. Code Rule 6A-1.012.

17. It has been said on more than one occasion that competitive bidding

requirements, such as those imposed upon district school boards, have as their

purpose and object the following:

[T]o protect the public against collusive

contracts; to secure fair competition upon

equal terms to all bidders; to remove not

only collusion but temptation for collusion

and opportunity for gain at public expense;

to close all avenues to favoritism and fraud

in various forms; to secure the best values

for the [public] at the lowest possible

expense; and to afford an equal advantage to

all desiring to do business with the

[government], by affording an opportunity for

an exact comparison of bids.

Wester v. Belote, 103 Fla. 976, 138 So. 721, 723-24 (Fla. 1931); Harry Pepper &

Associates, Inc. v. City of Cape Coral, 352 So.2d 1190, 92 (Fla. 2d DCA 1977).

18. In soliciting and accepting competitive bids, a district school board

has wide discretion. See D.O.T. V. Groves-Watkins Constructors, 530 So.2d 912,

913 (Fla. 1988); Liberty County v. Baxter's Asphalt & Concrete, Inc., 421 So.

2d 505, 507 (Fla. 1982). It has "the authority to reject any or all bids" and

to accept, what it deems to be, "the lowest and best bid." Fla. Admin. Code

Rule 6A-1.012.

19. Its discretion with respect to these matters, while broad, is not

unbridled. It must exercise such discretion in a manner that is not illegal,

dishonest, fraudulent, arbitrary, unreasonable, capricious or in any other way

that would subvert or undermine the purpose and object of competitive bidding.

See D.O.T. v. Groves-Watkins Constructors, 530 So.2d 912, 913-14 (Fla. 1988);

Caber Systems v. Department of General Services, 530 So.2d 325, 336 (Fla. 1st

DCA 1988); Couch Construction Company, Inc. v. Department of Transportation,

361 So.2d 172, 175 (Fla. 1st DCA 1978); Wood-Hopkins Contracting Company v.

Roger J. Au & Son, Inc., 354 So.2d 446, 450 (Fla. 1st DCA 1978).

20. In exercising its discretion, a district school board may not accept a

bid that is materially at variance with the invitation to bid. "However,

although a bid containing a material variance is unacceptable, not every

deviation from the invitation to bid is material. It is only material if it

gives the bidder a substantial advantage over the other bidders and thereby

restricts or stifles competition." Tropabest Foods, Inc. v. Department of

General Services, 493 So.2d 50, 52 (Fla. 1st DCA 1986). If it does not provide

the bidder with such a palpable competitive advantage, it constitutes a minor

irregularity that should be waived by the school board. See Robinson

Electrical Co., Inc. v. Dade County, 417 So.2d 1032, 1034 (Fla. 3d DCA 1982).

21. The outcome of the instant bid protest hinges upon whether

Petitioner's failure to return numbered pages 3 and 4 of the ITB was a material

variance that rendered the bid invalid or rather a minor irregularity that

should be waived. 2/ Respondent has heretofore taken the position that it was

the former. According to Respondent, by failing to return these numbered pages,

Petitioner "left out" of its bid the "material" contract terms and conditions

specified in these missing pages.

22. If Petitioner's failure to return these numbered pages had the effect

suggested by Respondent of excluding from the bid these contract terms and

conditions, the Hearing Officer would agree with Respondent that there was a

material variance that required Respondent to reject the bid as non-responsive.

Such is not the case, however. Although Petitioner may not have returned these

numbered pages, its bid nonetheless included the terms and conditions found on

these pages.

23. On the first page of the ITB, which Petitioner did return, was the

following statement appearing directly beneath the Bidder Acknowledgment Form

that Petitioner completed and executed:

This Invitation to Bid, General Conditions,

Instructions to Bidders, Special Conditions,

Specifications, Addenda and/or any other

pertinent document form a part of this

proposal and by reference are made a part

thereof.

"It is a generally accepted rule of contract law that, where a writing expressly

refers to and sufficiently describes another document, that other document, or

so much of it as is referred to, is to be interpreted as part of the writing."

OBS Company, Inc. v. Pace Construction Corporation, 558 So.2d 404, 406 (Fla.

1990). Applying this "generally accepted rule of contract law" to the facts of

the instant case, the Hearing Officer concludes that the contract terms and

conditions found on numbered pages 3 and 4, having been incorporated by

reference, were a part of Petitioner's bid, notwithstanding that these pages

were not returned with the bid.

24. Petitioner's failure to return these pages, while contrary to the

directions set forth in the ITB, has not given it any palpable competitive

advantage over South Eastern, which followed these directions and returned these

pages with its bid. Accordingly, this omission on its part should be viewed,

not as a material variance that renders its bid invalid, but as a minor

irregularity that should be waived by Respondent.

25. Because Petitioner submitted the lowest and best bid and its bid did

not vary in any material manner from the requirements of the ITB, it should be

awarded the contract advertised in the ITB.

RECOMMENDATION

Based upon the foregoing Findings of Fact and Conclusions of Law, it is

hereby

RECOMMENDED that the Palm Beach County School Board enter a final order

sustaining the instant bid protest and awarding to Petitioner the contract

advertised in Invitation to Bid No. SB 91C-284V.

DONE AND ENTERED in Tallahassee, Leon County, Florida, this 24th day of

June, 1991.

__________________________________

STUART M. LERNER

Hearing Officer

Division of Administrative Hearings

The DeSoto Building

1230 Apalachee Parkway

Tallahassee, Florida 32399-1550

[phone]

Filed with the Clerk of the

Division of Administrative Hearings

this 24th day of June, 1991.

ENDNOTES

1/ This paragraph provided as follows:

A bidder wishing to withdraw a bid for any

reason, after the final call for bids at the

designated time of opening, may not do so

unless a written request is submitted to the

Superintendent of the School Board of Palm

Beach County giving reasons for bid withdrawal.

If recommended by the Superintendent, this

request will be submitted to the Board for

their consideration.

2/ That Petitioner failed to return these pages as required by the ITB is

uncontroverted.

COPIES FURNISHED:

Robert A. Rosillo, Esquire

Office of General Counsel

The School Board of Palm Beach County, Florida

3970 RCA Boulevard

Suite 7010

Palm Beach Gardens, Florida 33410-4283

Fred A. Cianelli, Vice President

Pre-Cast Specialties, Inc.

5600 Northwest 72nd Avenue

Miami, Florida 33166

Faye Robnolte, Manager - Pole Division

South Eastern Prestressed Concrete

860 Benoist Farms Road

Post Office Box 15043

West Palm Beach, Florida 33416-5043

Abbey G. Hairston, General Counsel

The School Board of Palm Beach County, Florida

3970 RCA Boulevard, Suite 7010

Palm Beach Gardens, Florida 33410-4283

Betty Helser, Director of Purchasing

The School Board of Palm Beach County, Florida

3980 RCA Boulevard, Suite 8044

Palm Beach Gardens, Florida 33410-4283

Rick Chuma, Assistant Director of Purchasing

The School Board of Palm Beach County, Florida

3980 RCA Boulevard, Suite 8044

Palm Beach Gardens, Florida 33410-4293

Henry Boekhoff

Assistant Superintendent for Administration

The School Board of Palm Beach County, Florida

3910 RCA Boulevard, Suite 1011

Palm Beach Gardens, Florida 33410-4283

NOTICE OF RIGHT TO SUBMIT EXCEPTIONS

ALL PARTIES HAVE THE RIGHT TO SUBMIT WRITTEN EXCEPTIONS TO THIS RECOMMENDED

ORDER. ALL AGENCIES ALLOW EACH PARTY AT LEAST 10 DAYS IN WHICH TO SUBMIT

WRITTEN EXCEPTIONS. SOME AGENCIES ALLOW A LARGER PERIOD OF TIME WITHIN WHICH TO

SUBMIT WRITTEN EXCEPTIONS. YOU SHOULD CONTACT THE AGENCY THAT WILL ISSUE THE

FINAL ORDER IN THIS CASE CONCERNING AGENCY RULES ON THE DEADLINE FOR FILING

EXCEPTIONS TO THIS RECOMMENDED ORDER. ANY EXCEPTIONS TO THIS RECOMMENDED ORDER

SHOULD BE FILED WITH THE AGENCY THAT WILL ISSUE THE FINAL ORDER IN THIS CASE.