United States: Local Government Procurement Laws – What Does It Take To Be A "Responsive Bidder"?

In a previous article we discussed the requirement that, if it awards a public works contract, a public entity in the State of Georgia must award the contract to the "lowest responsible and responsive bidder," unless an exception to this requirement applies.

This article addresses what it means to be a "responsive bidder."  While responsibleness focuses on the bidder or proposer, responsiveness focuses on the bid or proposal.  Specifically, responsiveness requires that a bid or proposal respond and conform to the requirements of the invitation for bids or request for proposals (the "Bid Documents").

Any deviation from the requirements of the Bid Documents may be considered non-responsive.  But public entities have the discretion to waive minor deviations from the requirements of the Bid Documents.  Minor deviations are a matter of form and not of substance, or they pertain to some immaterial or inconsequential defect or variation from the exact requirement of the Bid Documents.  For example, a minor deviation may occur where a bidder fails to initial a price change, or to write the solicitation number, date, and time of bid opening on its bid envelope, or to provide incidental information requested in the bid documents, such as information about its affiliates, or to include a unit price where the unit price can be calculated by dividing the line item total by the estimated quantity.

A public entity does not have discretion, however, to waive material deviations from the requirements in the Bid Documents. Indeed, O.C.G.A. § 36-91-2(14) defines a "responsive bidder" or "responsive offeror" as "a person or entity that has submitted a bid or proposal that conforms in all material respects to the requirements set forth in the invitation for bids or requests for proposals." (emphasis added).  A deviation from the Bid Documents is considered "material" if the deviation: (1) gives the bidder a substantial competitive advantage or (2) prejudices other bidders.  Some examples of material deviations include:

  • Limiting or changing the terms of the proposed contract through the bid (g., the bidder offers to supply oranges when the invitation is for the supply apples);
  • Including reservations or conditions in the bid that were not in the proposed contract (g., bidder offers to supply apples, so long as the wholesale price of apples remains less than $2.00/lb.1);
  • Making a bid contingent upon also receiving award on other bids currently under consideration; and
  • Failing to acknowledge addenda or amendments to the proposed contract.

If a public entity determines a bid is non-responsive, it must inform the contractor in writing as to the basis for its determination that the bid was non-responsive.  Failure to do so constitutes a procedural violation of due process.

The determination of what constitutes a material versus a minor deviation is generally left to the discretion of the public entity or agency awarding the contract.  In R.D. Brown Contractors v. Board of Educ. of Columbia County2, for example, the invitation for bids stated that "[a]long with the bid a list of all major subcontractors . . . must be provided. No changes may be made to the list post-bid without prior approval from the Board." Based on this requirement, the second lowest bidder filed suit seeking an order from the court compelling the county board of education to award a school construction contract to the second lowest bidder because the lowest bidder did not include a list of subcontractors with its bid.  The Court held that the lowest bidder's failure to include a list of subcontractors was a minor deviation and recognized that a governmental entity, such as the Board, retains a statutorily granted power to waive technicalities, explaining that:

[U]nder the statutory scheme of public bidding, the Board has the power to determine, within the parameters of that scheme, what constitutes material conformity with the invitation for bids.  Brown points to no statute, regulation or ordinance that requires that subcontractors be listed on bids; the only place such a provision appears is on the invitation for bids produced by the Board.  The invitation does not state, or suggest, that a list of subcontractors is a material requirement; in fact, the subcontractors provision specifies that the list of subcontractors may change with the Board's approval, suggesting that any list is not to be considered fixed.  The invitation also reserved the right to waive technicalities, as authorized by State law.  As the genesis of the specification concerning a list of subcontractors is solely by the Board, we see no reason why the Board could not determine that it was not a material requirement, but rather a technicality that could be waived.

Some seemingly minor deviations can be deemed material if they prejudice other bidders.  At first blush, submitting a bid a few minutes late may seem like a minor deviation.  Indeed, some states have allowed late bids upon a showing of no actual prejudice to other bidders.  Not in Georgia, where bids submitted after the time set for bid opening in the invitation for bids, even though prior to actual commencement of bid opening, have been rejected as nonresponsive in the interest of protecting the integrity of sealed bidding.

For example, in City of Atlanta v. J.A. Jones3, the Georgia Court of Appeals rejected the City's argument that it could accept a late bid if the other bids had yet to be opened, and ruled that submission of a late bid was a material deviation under Georgia law that was beyond the City's discretion to waive.

The Bid Documents in the J.A. Jones case stated that bids had to be submitted "... no later than 2:00 pm, April 10, 1985."  J.A. Jones submitted its bid before the 2:00 p.m. deadline; two other bidders did not.  The apparent low bid was submitted at 2:03 pm, three minutes late. J.A. Jones' bid was the second lowest bid, approximately $10,500 more than the bid by the apparent low bidder for a contract in which all bids received exceeded $13 million.

Initially, the City rejected the apparent low bid as untimely, but the bidder asked the City to check the accuracy of the bid clocks.  The City determined that, at 5:00 p.m. on April 10, the bid clock was 3 minutes fast and awarded the contract to the apparent low bidder. The record, however, showed the clock was never found fast in the years before or after 5:00 p. m., April 10, 1985, and no one could say that the clock was three minutes fast at 2:00 p. m. that day.

J.A. Jones protested the City's consideration of the late bid in three separate letters to the City on April 10, 23, and 25th.  A City ordinance authorized frustrated bidders, like J.A. Jones, to submit protests by letter, and obligated the City to reply within 10 days with its reasoned decision.  Rather than respond to J.A. Jones' letters, the City engaged in an internal debate over whether ICC's bid was timely.  The City ultimately determined that the bid was late, but that a bid three minutes late was a minor deviation that could be waived in its discretion if it saved taxpayer money.

On appeal, the Georgia Court of Appeals held that a late bid was a material deviation from the requirements of the Bid Documents and that the City did not have discretion to waive the requirement because the late submission of a bid gives the late bidder an unfair advantage over other bidders.  The Court reasoned that time is critical to bidders, who often synchronize their watches to the bid clock so they can make significant last minute price changes.  "Indeed, Jones lowered its bid by over $4,000,000 in the last hours and by an additional $200,000 in the minutes before the bid was submitted. Thus, even without [the late bidder] knowing the amounts of the other bids, a late bidder gained an important advantage by gaining additional time to revise its bid."

The Court of Appeals also held that the City's failure to timely respond to J.A. Jones' protest letters was a violation of due process that denied Jones the right to be heard in a meaningful time and manner, and to provide an adequate remedy to redress the wrong, which entitled J.A. Jones to damages of $375,000, in addition to $522,125.05 for anticipated profits. The Georgia Supreme Court reversed the damages award, explaining that "when, as here, a governmental entity has frustrated the bid process and awarded the contract to an unqualified bidder, the injured low bidder may bring an action for appropriate relief. [] However, a low bidder whose bid is unfairly rejected is only entitled to an award of reasonable costs of bid preparation," which for Jones was $22,125.05.

Bid protests are often asserted to determine whether a bidder's failure to follow the Bid Documents makes its bid non-responsive. But these protests are rarely successful because courts generally defer to the public entity's decision about whether a deviation was material or not, unless the public entity failed to follow the legal procedure for making such a decision.

Footnotes

1 See, e.g., Lift Power, Inc., Comp Gen. Dec. B-182604, 75-1 CPD ¶ 13 (finding a bid nonresponsive where a contractor reserved the right in the bid to change the price if costs should increase).

2 280 Ga. 210, 626 S.E.2d 471 (2006).

3 195 Ga. App. 72, 392 S.E.2d 564 (1990) cert. granted, (May 3, 1990) and judgment rev'd, 260 Ga. 658, 398 S.E.2d 369 (1990), on remand to, 198 Ga. App. 345, 402 S.E.2d 554 (1991)

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

To print this article, all you need is to be registered on Mondaq.com.

Click to Login as an existing user or Register so you can print this article.

Authors
Similar Articles
Relevancy Powered by MondaqAI
Fredrikson & Byron, P.A.
 
In association with
Related Topics
 
Similar Articles
Relevancy Powered by MondaqAI
Fredrikson & Byron, P.A.
Related Articles
 
Related Video
Up-coming Events Search
Tools
Print
Font Size:
Translation
Channels
Mondaq on Twitter
 
Register for Access and our Free Biweekly Alert for
This service is completely free. Access 250,000 archived articles from 100+ countries and get a personalised email twice a week covering developments (and yes, our lawyers like to think you’ve read our Disclaimer).
 
Email Address
Company Name
Password
Confirm Password
Position
Mondaq Topics -- Select your Interests
 Accounting
 Anti-trust
 Commercial
 Compliance
 Consumer
 Criminal
 Employment
 Energy
 Environment
 Family
 Finance
 Government
 Healthcare
 Immigration
 Insolvency
 Insurance
 International
 IP
 Law Performance
 Law Practice
 Litigation
 Media & IT
 Privacy
 Real Estate
 Strategy
 Tax
 Technology
 Transport
 Wealth Mgt
Regions
Africa
Asia
Asia Pacific
Australasia
Canada
Caribbean
Europe
European Union
Latin America
Middle East
U.K.
United States
Worldwide Updates
Registration (you must scroll down to set your data preferences)

Mondaq Ltd requires you to register and provide information that personally identifies you, including your content preferences, for three primary purposes (full details of Mondaq’s use of your personal data can be found in our Privacy and Cookies Notice):

  • To allow you to personalize the Mondaq websites you are visiting to show content ("Content") relevant to your interests.
  • To enable features such as password reminder, news alerts, email a colleague, and linking from Mondaq (and its affiliate sites) to your website.
  • To produce demographic feedback for our content providers ("Contributors") who contribute Content for free for your use.

Mondaq hopes that our registered users will support us in maintaining our free to view business model by consenting to our use of your personal data as described below.

Mondaq has a "free to view" business model. Our services are paid for by Contributors in exchange for Mondaq providing them with access to information about who accesses their content. Once personal data is transferred to our Contributors they become a data controller of this personal data. They use it to measure the response that their articles are receiving, as a form of market research. They may also use it to provide Mondaq users with information about their products and services.

Details of each Contributor to which your personal data will be transferred is clearly stated within the Content that you access. For full details of how this Contributor will use your personal data, you should review the Contributor’s own Privacy Notice.

Please indicate your preference below:

Yes, I am happy to support Mondaq in maintaining its free to view business model by agreeing to allow Mondaq to share my personal data with Contributors whose Content I access
No, I do not want Mondaq to share my personal data with Contributors

Also please let us know whether you are happy to receive communications promoting products and services offered by Mondaq:

Yes, I am happy to received promotional communications from Mondaq
No, please do not send me promotional communications from Mondaq
Terms & Conditions

Mondaq.com (the Website) is owned and managed by Mondaq Ltd (Mondaq). Mondaq grants you a non-exclusive, revocable licence to access the Website and associated services, such as the Mondaq News Alerts (Services), subject to and in consideration of your compliance with the following terms and conditions of use (Terms). Your use of the Website and/or Services constitutes your agreement to the Terms. Mondaq may terminate your use of the Website and Services if you are in breach of these Terms or if Mondaq decides to terminate the licence granted hereunder for any reason whatsoever.

Use of www.mondaq.com

To Use Mondaq.com you must be: eighteen (18) years old or over; legally capable of entering into binding contracts; and not in any way prohibited by the applicable law to enter into these Terms in the jurisdiction which you are currently located.

You may use the Website as an unregistered user, however, you are required to register as a user if you wish to read the full text of the Content or to receive the Services.

You may not modify, publish, transmit, transfer or sell, reproduce, create derivative works from, distribute, perform, link, display, or in any way exploit any of the Content, in whole or in part, except as expressly permitted in these Terms or with the prior written consent of Mondaq. You may not use electronic or other means to extract details or information from the Content. Nor shall you extract information about users or Contributors in order to offer them any services or products.

In your use of the Website and/or Services you shall: comply with all applicable laws, regulations, directives and legislations which apply to your Use of the Website and/or Services in whatever country you are physically located including without limitation any and all consumer law, export control laws and regulations; provide to us true, correct and accurate information and promptly inform us in the event that any information that you have provided to us changes or becomes inaccurate; notify Mondaq immediately of any circumstances where you have reason to believe that any Intellectual Property Rights or any other rights of any third party may have been infringed; co-operate with reasonable security or other checks or requests for information made by Mondaq from time to time; and at all times be fully liable for the breach of any of these Terms by a third party using your login details to access the Website and/or Services

however, you shall not: do anything likely to impair, interfere with or damage or cause harm or distress to any persons, or the network; do anything that will infringe any Intellectual Property Rights or other rights of Mondaq or any third party; or use the Website, Services and/or Content otherwise than in accordance with these Terms; use any trade marks or service marks of Mondaq or the Contributors, or do anything which may be seen to take unfair advantage of the reputation and goodwill of Mondaq or the Contributors, or the Website, Services and/or Content.

Mondaq reserves the right, in its sole discretion, to take any action that it deems necessary and appropriate in the event it considers that there is a breach or threatened breach of the Terms.

Mondaq’s Rights and Obligations

Unless otherwise expressly set out to the contrary, nothing in these Terms shall serve to transfer from Mondaq to you, any Intellectual Property Rights owned by and/or licensed to Mondaq and all rights, title and interest in and to such Intellectual Property Rights will remain exclusively with Mondaq and/or its licensors.

Mondaq shall use its reasonable endeavours to make the Website and Services available to you at all times, but we cannot guarantee an uninterrupted and fault free service.

Mondaq reserves the right to make changes to the services and/or the Website or part thereof, from time to time, and we may add, remove, modify and/or vary any elements of features and functionalities of the Website or the services.

Mondaq also reserves the right from time to time to monitor your Use of the Website and/or services.

Disclaimer

The Content is general information only. It is not intended to constitute legal advice or seek to be the complete and comprehensive statement of the law, nor is it intended to address your specific requirements or provide advice on which reliance should be placed. Mondaq and/or its Contributors and other suppliers make no representations about the suitability of the information contained in the Content for any purpose. All Content provided "as is" without warranty of any kind. Mondaq and/or its Contributors and other suppliers hereby exclude and disclaim all representations, warranties or guarantees with regard to the Content, including all implied warranties and conditions of merchantability, fitness for a particular purpose, title and non-infringement. To the maximum extent permitted by law, Mondaq expressly excludes all representations, warranties, obligations, and liabilities arising out of or in connection with all Content. In no event shall Mondaq and/or its respective suppliers be liable for any special, indirect or consequential damages or any damages whatsoever resulting from loss of use, data or profits, whether in an action of contract, negligence or other tortious action, arising out of or in connection with the use of the Content or performance of Mondaq’s Services.

General

Mondaq may alter or amend these Terms by amending them on the Website. By continuing to Use the Services and/or the Website after such amendment, you will be deemed to have accepted any amendment to these Terms.

These Terms shall be governed by and construed in accordance with the laws of England and Wales and you irrevocably submit to the exclusive jurisdiction of the courts of England and Wales to settle any dispute which may arise out of or in connection with these Terms. If you live outside the United Kingdom, English law shall apply only to the extent that English law shall not deprive you of any legal protection accorded in accordance with the law of the place where you are habitually resident ("Local Law"). In the event English law deprives you of any legal protection which is accorded to you under Local Law, then these terms shall be governed by Local Law and any dispute or claim arising out of or in connection with these Terms shall be subject to the non-exclusive jurisdiction of the courts where you are habitually resident.

You may print and keep a copy of these Terms, which form the entire agreement between you and Mondaq and supersede any other communications or advertising in respect of the Service and/or the Website.

No delay in exercising or non-exercise by you and/or Mondaq of any of its rights under or in connection with these Terms shall operate as a waiver or release of each of your or Mondaq’s right. Rather, any such waiver or release must be specifically granted in writing signed by the party granting it.

If any part of these Terms is held unenforceable, that part shall be enforced to the maximum extent permissible so as to give effect to the intent of the parties, and the Terms shall continue in full force and effect.

Mondaq shall not incur any liability to you on account of any loss or damage resulting from any delay or failure to perform all or any part of these Terms if such delay or failure is caused, in whole or in part, by events, occurrences, or causes beyond the control of Mondaq. Such events, occurrences or causes will include, without limitation, acts of God, strikes, lockouts, server and network failure, riots, acts of war, earthquakes, fire and explosions.

By clicking Register you state you have read and agree to our Terms and Conditions