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Decisions Of The Comptroller General

Wednesday, February 04, 2009 05:05 pm

Decisions Of The Comptroller General A ROSE OFANOTHER NAME MIGHT SMELLAS SWEET, BUT IT WON'T SATISFY YOUR BID BOND REQUIREMENT Bid BondBid Protest Matter of: Mill City Partnership

Comptroller General of the United States 2008 U.S.Comp.Gen.B400712(December 16, 2008) This case serves as an excellent reminder that bid bonds are more than a mere formality, and if you do business under several names, you'd best pick one identity to bond with on your bids.

In August 2008, the Army Corps of Engineers(Corps) solicited bids for an environmental restoration project that required a bid bond in the amount of 20 percent of the bid. Mill City Partnership(Mill City), the apparent lowbidder, identified itself at various times on its bid forms as Mill City Environmental Corp.and Mill City Environmental Corp.w/ Teaming Partner C.R.C.Co., Inc.On its accompanying bid bond, Mill City identified its principal as C.R.C.Company, Inc.(CRC), and the signature block on the bond contained only the signature of CRC's president.

The Corps notified Mill City by letter that its bid was nonresponsive because of a deficiency in its bid bond. The government awarded the contract to the nextlowest bidder(a company with absolutely no flair or imagination, demonstrated by its having only one name, which it used consistently on all of its forms).Mill City filed a protest, which was denied.

In denying Mill City's protest, the Comptroller General emphasized that the sufficiency of a bid bond relates to whether the government will receive full and complete protection if the bidder fails to perform.The terms of a bid bond must clearly establish the liability of the surety, otherwise the bond is defective.

Since a surety does not incur liability to pay another's debt unless he expressly agrees to be bound, a bo [...]

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