BNUMBER:  B-270036
DATE:  January 19, 1996
TITLE:  Johnson Controls, Inc.

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Matter of:Johnson Controls, Inc.

File:     B-270036

Date:     January 19, 1996

Douglas O. Smith, Esq., for the protester.
Jeffrey M. Denson, Esq., and Cynthia S. Guill, Esq., Department of the 
Navy, for the agency.
Henry J. Gorczycki, Esq., and James A. Spangenberg, Esq., Office of 
the General Counsel, GAO, participated in the preparation of the 
decision.

DIGEST

Agency properly determined that the validity of a bid bond was 
uncertain, and the bid therefore nonresponsive, where the surety's 
power of attorney authorizing the named attorney-in-fact to sign the 
bid bond on the surety's behalf contained an undated certification 
that the power of attorney had not been revoked.

DECISION

Johnson Controls, Inc. protests the rejection of its bid under 
invitation for bids (IFB) No. N44255-94-B-7523, issued by the 
Department of the Navy for a direct digital control system for the 
Trident Training Facility, Naval Submarine Base, Bangor, Silverdale, 
Washington.  Johnson protests that the Navy improperly rejected its 
bid as nonresponsive.

We deny the protest.

The Navy received eight bids at bid opening on August 29, 1995.  
Johnson submitted the apparent low bid of $309,096.  Along with its 
bid, Johnson submitted the required bid bond on a standard form 24, 
dated August 28 and signed by Janis M. Muccio, attorney-in-fact for 
the surety, Safeco Insurance Company of America.  A power of attorney 
submitted with the bond authorized Ms. Muccio to act as 
attorney-in-fact for, and execute bonds on behalf of, Safeco.  The 
power of attorney was signed by the president and secretary of Safeco 
and was dated February 12, 1993.  The bottom half of the power of 
attorney constituted a certificate which, when completed, certified 
that the power of attorney remained in full force and effect as 
initially executed, and had not been revoked.  This certificate was 
signed by the secretary of Safeco and Safeco's corporate seal was 
affixed next to this signature; however, the space for inserting the 
date of the certificate was blank.

The Navy concluded that, with an undated certificate, the surety could 
disclaim liability simply by stating that the power of attorney had 
been revoked prior to the execution of the bid bond.  The Navy thus 
determined that the validity of the bid bond was uncertain and that 
Johnson's bid was nonresponsive.  By letter of September 25, the Navy 
informed Johnson that it had rejected Johnson's bid and had awarded 
the contract to Christenson Electric for $402,972.  This protest 
followed.

Johnson alleges that the power of attorney was properly executed and 
that the certificate, although not dated, was signed by a corporate 
officer of the surety; thus, the surety was bound under the bond 
executed by its designated attorney-in-fact.  Johnson concludes that 
the validity of the bid bond is certain and that its bid is 
responsive.

A bond is a written instrument executed by a principal party (i.e., 
the bidder or contractor) and a second party surety to assure 
fulfillment of the principal's obligations to a third party (i.e., the 
government).  Federal Acquisition Regulation (FAR)  sec.  28.001.  A bid 
bond assures the surety's liability to the government for the excess 
cost of awarding to the next eligible bidder in the event that the 
awardee (i.e., the principal) fails to fulfill its obligations.  A.W. 
and Assocs., Inc., 69 Comp. Gen. 737 (1990), 90-2 CPD  para.  254; 
Shackelford Mechanical, Inc., B-261948, Nov. 1, 1995, 95-2 CPD  para.  203.  
When required by a solicitation, a bid bond is a material part of the 
bid and a valid bid bond must be furnished with the bid in order for 
it to be responsive.  A.D. Roe Co., Inc., 54 Comp. Gen. 271 (1974), 
74-2 CPD  para.  194.

Where a bid bond is accompanied by a power of attorney that on its 
face does not establish unequivocally that the person signing on 
behalf of the surety has the authority to bind the surety, such a 
power of attorney creates doubt as to whether the surety is bound by 
the bid bond under the law of suretyship, and therefore renders the 
bid nonresponsive.  A.W. and Assocs., Inc., supra; Shackelford 
Mechanical, Inc., supra.  Where a power of attorney is dated in 
advance of a bid bond, there exists the possibility that the surety 
may have revoked the power of attorney prior to the execution of the 
bid bond.  Shackelford Mechanical, Inc., supra; Quantum Constr., Inc., 
B-255049, Dec. 1, 1993, 93-2 CPD  para.  304.  Similarly, an undated 
certification attesting to the continuing validity of an aged power of 
attorney provides no reasonable assurance of the surety's recent 
affirmation of the validity of the power of attorney, such that the 
agency must consider the validity of the bid bond uncertain and reject 
the corresponding bid as nonresponsive.[1]  Shackelford Mechanical, 
Inc., supra (bid is nonresponsive because of undated certification on 
a 7-month-old power of attorney); Quantum Constr., Inc., supra (bid is 
nonresponsive because of an undated certification on 6-1/2-month-old 
power of attorney). 

Here, the effective date of the power of attorney was 2-1/2 years 
prior to the bid bond date, and the surety did not date its 
certification affirming the validity of the power of attorney.  Thus, 
the certificate possibly could have been signed up to 2-1/2 years 
prior to the execution of the bid bond, and reasonable doubt exists as 
to whether the surety may have revoked the power of attorney in the 
intervening years.  Under these circumstances, the Navy reasonably 
determined that the validity of the power of attorney and the bid bond 
was uncertain, and properly rejected the bid as nonresponsive.  
Quantum Constr., Inc., supra. 

The protest is denied.

Comptroller General
of the United States

1. A surety's certification attesting to the continuing validity of 
the power of attorney, which is made by the surety at a date 
reasonably close to the date of the bid bond, provides the government 
with a reasonable assurance that the surety has not revoked the power 
of attorney prior to the execution of the bid bond.  Integrity Works, 
B-258818, Feb. 21, 1995, 95-1 CPD  para.  98 (bid is responsive where the 
certificate was signed only 1 day prior to bond date).