This article is an excerpt from The Art of Tendering: A Global Due Diligence Guide, which is available for purchase.
In its June 2005 decision in Systea Scientific, LLC v. Department of Health, the Florida Division of Administrative Hearings upheld the Department of Health’s decision to accept a low bid that contained a minor irregularity. The case dealt with an Invitation to Bid (ITB) for the provision of laboratory equipment and related support services. While it filled out all the required line items in its price form, the low bidder failed to fill out the total bid price. A competing bidder filed a bid protest, challenging the compliance of the low bid. However, the Court found that the non-compliance was a minor irregularity, since the line items contained the necessary information to calculate the total price:
The omission of the “grand total” on the Price Page of Lachat’s bid is a minor irregularity because the bid contained (on the Price Page) all of the figures necessary to calculate the “grand total,” and the tabulation of the “grand total” was a simple mathematical calculation that the Department would have made in any event to verify the accuracy of the “grand total” based upon the unit prices itemized on the Price Page. If Lachat’s bid was rejected based upon the omission of the “grand total” on the Price Page, there would be a negative fiscal impact on the Department of more than $3,000 because the bids of Systea and OI (as tabulated by the Department) were that much higher than Lachat’s bid.
The Court therefore upheld the contract award to the low bidder and rejected the competing bidder’s legal challenge.
As this case illustrates, tender compliance irregularities serve as a catalyst for bid protests. While it may be impossible to completely eliminate bidder errors, purchasing institutions should strive to make their solicitation documents as clear as possible to mitigate the risk of bidder error and to reduce the volume of any resulting tender compliance challenges.
