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.