This article is an excerpt from The Art of Tendering: A Global Due Diligence Guide, which is available for purchase.
In its April 2017 decision in National Water Main Cleaning Co v. Department of Transportation, the Florida Division of Administrative Hearings upheld the rejection of a low bid due to a flawed bid bond. The case dealt with an Invitation to Bid (ITB) on a sewer pipe rehabilitation project. The solicitation required a bid bond in the amount of five percent of the bid price and in the form of an approved electronic copy or paper original.
As the Court summarized, the low bidder failed to submit either the original bid bond or certified electronic version. Instead, the low bidder attached an uncertified electronic copy of the original bid bond, as explained below:
Petitioner chose not to utilize either the Surety2000 or SurePath electronic bid systems, which provide verification of bid bonds. Petitioner attached a copy of a bid bond to its electronic bid. Doing so did not convert the paper bid bond into an electronic bid bond. Having chosen not to use either of the electronic bid bond services, the plain language of the ITB limited Petitioner to only one other alternative–submittal of a paper bid bond to the location identified in the ITB for receipt of bids prior to the deadline for receipt of bids. Further, the ITB specified that if an electronic bid bond is not being submitted, “the bidder must submit an original bid bond.” Petitioner did not submit the original bid bond, but rather submitted a copy—a method expressly prohibited by the specifications. It matters not that the copy came as an attachment to its electronic bid submission, rather than a fax or copy by U.S. Mail or delivery service. A copy is a copy and the original was required since an electronic bid bond was not submitted.
The Court upheld the Department of Transportation’s decision to reject the bid as non-compliant after finding that the failure to submit a proper bid bond went beyond a minor irregularity and constituted a material irregularity that rendered the bid legally invalid.
