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Procurement Perspectives: Conditional or qualified municipal bids explored

Stephen Bauld
Procurement Perspectives: Conditional or qualified municipal bids explored

It is worth noting that many municipalities reserve a right under the terms and conditions of a tender “to accept bids conditionally.”

Generally, provisions of this type are taken to mean that the municipality may itself impose conditions at the time when accepting a bid, not that it is reserving a right to consider bids submitted subject to some qualification.

The problem is raised by bids that contain some minor irregularity.

Many municipalities retain an express right to clarify and admit such bids. The following provisions are broader than most, but they confer some idea of the nature of the privileges concerned:

  • The city may waive compliance with any minor requirement governing the submission of bids, including (but not limited to) any requirement to (i) attending any meeting (ii) inspect any site or thing, provided that in so doing the city shall not unfairly prejudice any other bidder;
  • At its sole discretion, the city may clarify any aspect of any bid received in respect of the bid with any bidder at any time, and may clarify any aspect of the price bid by the bidder, and (a) the purpose of such clarification may be, (i) to enable the city to determine the bid to which it relates complies with the tender; (ii) to resolve any ambiguity in the language used, or any other vague or uncertain aspect of the bid. No such clarification shall alter the bid or constitute negotiation or re-negotiation of the price or any aspect thereof, or the nature or quality of the goods or services to be supplied or performed as set out in the bid at the close of the tender, and all correspondence with a bidder for the purposes of such clarification shall be conducted through the purchasing section.
  • The city’s right to clarify shall include the right to request additional or missing information related to the goods or services that are to be supplied or the manner in which the project or work is to be carried out.
  • The right of clarification provided under this section is within the sole, complete and unfettered discretion of the city and is for its exclusive benefit and may or may not be exercised by the city at any time and in respect to any or all bids.
  • The right to clarify shall not impose upon the city a requirement to clarify with the bidder any part of a bid, and where in the opinion of the city the bid is ambiguous, incomplete, deficient, or otherwise not acceptable in any aspect, and the city may reject a bid either before or after seeking a clarification under this section.
  • Neither the review of its submission with any bidder, nor the seeking of clarification under this section, shall oblige the city to enter into a contract with that bidder, and shall not constitute an acceptance of that bid or any other bid.
  • All clarifications under this section shall be in writing, in a form satisfactory for inclusion in the contract and satisfactory to the city.

A minor informality or irregularity is one that is a matter of form not of substance.

The term also covers any immaterial defect in a bid or variation of a bid from exact requirements of the invitation that can be corrected or waved without prejudicial to other bidders.

The defect or variation is immaterial when the effect on price, quality or delivery is negligible when contrasted with the total cost or scope of the suppliers or services being acquired. Generally, any reserved discretion in relation to minor irregularities or informalities — however such deficient bids may be described — should be exercised with care.

There is frequent litigation over the exercise of such privileges.

 

Stephen Bauld is a government procurement expert and can be reached at swbauld@purchasingci.com.

Some of his columns may contain excerpts from The Municipal Procurement Handbook published by Butterworths.

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