It doesn’t happen very often. But on occasion, a protester gets a “no” from the Government Accountability Office (GAO) and a “yes” from the U.S. Court of Federal Claims (CFC) on the same issue. This protest rarity occurred recently when the court was asked to consider whether the winner’s offer was late and therefore could not be a winning offer. The protester had already gone to GAO and had gotten GAO’s answer that the winner’s bid was on time. But after bringing the same argument to the court, the protester got the opposite an-swer―that the winner’s bid was late and should not be accepted.

The bids involved in the case were due by Saturday, May 15, 2004, at 1 p.m. The amendment setting this time and date included the names and phone numbers of government employees who could be contacted if there were any questions. The company that eventually protested, Hospital Klean of Texas Inc. (HKI), submitted its proposal the day before: on Friday, May 14, 2004. The company that eventually won, Integrity Management Services Inc., shipped its proposal by FedEx for Saturday delivery. Integrity did not put on the FedEx air bill the phone numbers and names of the intended recipient or the government personnel identified in the amendment.

When FedEx tried to deliver the proposal on Saturday, nobody was in to accept delivery and the agency’s doors were locked. The contracting officer later said that “someone was supposed to be listening for the expected Federal Express deliveries, but never heard the knock.” Three hours later, a proposal from another competitor was successfully delivered. On Monday, when the government offices reopened, two other offers were received, as well as the not-yet-delivered offer from Integrity. Even though these proposals had obviously been submitted several days past the Saturday deadline and were therefore late, the government considered them to be timely. While the “integrity” of the process here was losing, eventually Integrity (the company) won. For a while.

HKI protested to GAO. But GAO blamed the late delivery on the government, making it okay for the government to find Integrity’s proposal timely and also the winner. According to GAO, the contracting officer could accept the late offer because “the agency’s action was the paramount cause for the late delivery of the proposal ... [the government had] failed to establish adequate procedures to ensure that rea-sonable attempts to deliver hand-carried proposals prior to closing would be received at the place designated for delivery. Specifically, Saturday was not a normal business day for the agency and the doors to the agency were locked. The agency did not post instructions outside the locked door stating that agency personnel would be present to receive deliveries, or how to contact them. Therefore, when a courier attempted to enter the locked doors and received no response from within, it was reasonable for the courier to assume that delivery at that address on Saturday was not possible.”

Not satisfied with this answer, HKI protested to the court and got the opposite answer―that the winner’s bid was in fact late.

The court started with the Federal Acquisition Regulation (FAR) rules for late bids, FAR § 15.208, which, in the court’s words, hold that “the contracting officer may not consider a late proposal unless there is acceptable evidence to establish that it was received at the Government installation designated for receipt of proposals and was under the Government’s control prior to the time set for receipt of proposals. Here, it is undisputed that Integrity’s proposal was not received by the Government and was not in the Government’s control by the time of closing.”

The court continued with some not-so-subtle criticism of the GAO approach to late bids: “The Comptroller General has on numerous occasions refused to apply this regulation requiring the rejection of late bids or offers …. One of the fundamental principles underlying the [GAO] rules for the consideration of late bids is that a bidder who has done all it could and should to fulfill its responsibility should not suffer if the bid did not arrive as required because the government failed in its own responsibility ....”

But the court did not think that Integrity had done all that it could. “Here, Integrity and its agent Federal Express were not without fault in the tardy delivery of Integrity’s proposal. First, there is no indication on the Federal Express slip informing the courier that delivery needed to be effected by 1 pm. Second, there is no indication that any effort beyond knocking on the locked door occurred to ensure delivery―such as calling Integrity or attempting to call the agency contracting officials identified in the e-mail extending the closing date. Finally, this record indicates that there was no attempt at redelivery that day.”

The court concluded that performance of the Integrity contract should be tem-porarily enjoined.

Hospital Klean of Texas, Inc. v. The United States, U.S. Court of Federal Claims No. 05-495C, May 17, 2005.