STATE OF FLORIDA

DIVISION OF ADMINISTRATIVE HEARINGS

WILLIS PHILLIPS, )

)

Petitioner, )

)

vs. ) CASE NO. 90-2653BID

)

DEPARTMENT OF HEALTH AND )

REHABILITATIVE SERVICES, )

)

Respondent, )

)

and )

)

RUTHERFORD RENTALS, INC., )

)

Intervenor. )

)

RECOMMENDED ORDER

Pursuant to written notice a formal hearing was held in this case before Larry J. Sartin, a duly designated Hearing Officer of the Division of Administrative Hearings, on May 16 and 17, 1990, in Tallahassee, Florida.

APPEARANCES

For Petitioner: John C. Pelham, Esquire

Gary Walker, Esquire Pennington, Wilkinson, Dunlap,

Bateman & Camp, P.A. Post Office Box 13527

Tallahassee, Florida 32317-3527

For Respondent: John L. Pearce

District Legal Counsel Department of Health and

Rehabilitative Services District 2

2639 North Monroe Street Suite 200-A

Tallahassee, Florida 32303-2949

For Intervenor: Clay A. Schnitker, Esquire

Davis, Browning & Schnitker, P.A. Post Office Drawer 652

Madison, Florida 32340

STATEMENT OF THE ISSUES

1. Whether the Petitioner, Willis Phillips, may challenge the specifications of the invitation to bid at issue in this proceeding?

   
   

2. Whether the Petitioner has standing to challenge the Department of Health and Rehabilitative Services' proposed award of lease number 590:2166 to the Intervenor, Rutherford Rentals, Inc.?

PRELIMINARY STATEMENT

The Petitioner filed a Formal Protest and Petition for Formal Administrative Hearing with the Respondent, the Department of Health and Rehabilitative Services (hereinafter referred to as the "Department"), on April 30, 1990. The Petitioner challenged the Department's proposed decision to award lease number 590:2166 to the Intervenor.

The Formal Protest was filed with the Division of Administrative Hearings on May 1, 1990, by Notice of Referral and Notice to Bidders. The Formal Protest was assigned case number 90-2653BID.

On May 4, 1990, the Department filed a Motion to Dismiss. On May 10, 1990, the Intervenor filed its Petition to Intervene. On May 14, 1990, the Petitioner filed a Motion for Leave to File Amended Petition.

At the commencement of the formal hearing, the Petition to Intervene was granted. Finding no prejudice to the Department or Intervenor, the Motion for Leave to File Amended Petition was also granted. Thereupon, the Motion to Dismiss was considered. After hearing argument of the parties a limited evidentiary proceeding ensued. During the evidentiary proceeding evidence was presented concerning the issue of whether the bid specifications at issue and a map attached thereto were ambiguous.

The Petitioner testified and presented the testimony of Mary Goodman. Ms.

Goodman was accepted as an expert in the acquisition of property by state agencies, the responsiveness of bids, the review of bid specifications and boundary location determinations.

The Department presented the testimony of Robert Smith and Joseph R. Shuford.

The Intervenor presented the testimony of Wilbur Gene Rutherford, Jr., and Doug Barfield.

Joint Exhibits 1 and 2 were offered and accepted into evidence. Without objection, the invitation to bid attached to the Formal Protest was determined to constitute a basis for making findings of fact.

The undersigned concluded that the Petitioner had waived his right to challenge the specifications of the invitation to bid, despite the Department's failure to notify the Petitioner of his right to challenge the invitation to bid. It was also concluded that the Department's designation of the areas within which it was seeking to rent office space was not ambiguous and that the Petitioner knew that his property was located in an portion of the City of Madison excluded from consideration. Finally, it was concluded that the Petitioner was disqualified from submitting a response to the invitation to bid

and, therefore, lacked standing to challenge the Department's proposed award of lease number 590:2166. Accordingly, the undersigned concluded that the Department's Motion to Dismiss should be granted.

The Petitioner and the Department have filed proposed recommended orders containing proposed findings of fact. A ruling on each proposed finding of fact has been made either directly or indirectly in this Recommended Order or the proposed finding of fact has been accepted or rejected in the Appendix which is attached hereto. The Intervenor has indicated that it will rely upon the proposed recommended order filed by the Department.

FINDINGS OF FACT

1. The Department issued an Invitation to Bid for Existing Facilities, lease number 590:2166 (hereinafter referred to as the "ITB"), seeking to rent office space in Madison, Florida.

   
   

2. Responses to the ITB were to be filed with the Department by 2:00 p.m., March 6, 1990.

   
   

3. Included as part of the ITB was a map of the City of Madison (hereinafter referred to as the "Map"). Joint Exhibit 1.

   
   

4. On page 1, paragraph 3, of the Bid Submittal Form which was included as part of the ITB it was indicated that "[s]pace to be located in Madison, Florida within boundaries depicted in the attached map (Attachment B.) Bidder

   to mark location of site on map Attachment B."

   
   

5. The ITB referred to the Map as a "Map showing bid zone boundaries." See page 4 of the ITB.

   
   

6. The Map was labeled as "Attachment B" and included the following language at the bottom of the Map: "WITHIN CITY LIMITS WITH EXCEPTIONS OF UNDESIRABLE LOCATIONS AS INDICATED."

   
   

7. The Map included two areas within the City of Madison which were cross- hatched. At the bottom of the Map the word "UNDESIRABLE" had been written in black. This word only appears below the larger of the two cross-hatched areas.

   
   

8. The Department intended to exclude any office space located within both of the cross-hatched areas on the Map.

   
   

9. The Petitioner spoke by telephone with Robert Smith, a Facilities Services Managers Assistant for the Department, prior to submitting a response to the ITB. The Petitioner initiated the conversation. Based upon this conversation, the Petitioner was aware that property located within either of the cross-hatched areas on the Map was excluded from consideration under the ITB.

   
   

10. The property which the Petitioner intended to offer to the Department in response to the ITB is located in the smallest of the two cross-hatched areas on the Map.

    
    

11. The Petitioner was informed by Mr. Smith that the property located within the smaller cross-hatched area was excluded as undesirable. Mr. Smith informed the Petitioner that he could not submit a response to the ITB offering to rent property located in the small cross-hatched area.

12. The exclusion from consideration of property located in the areas within the City of Madison which were located in the two cross-hatched areas of the Map could have been more clearly designated. The Department's designation of the excluded areas, however, was not ambiguous. It was clear that the Petitioner's property was located in an excluded portion of the City of Madison and that the Petitioner was aware of the exclusion of his property.

    
    

13. Despite the Petitioner's knowledged that his property was located within an excluded area, the Petitioner submitted a response dated March 6, 1990, to the ITB proposing property located in the smaller cross-hatched area.

    
    

14. In the Petitioner's response to the ITB he did not indicate the location of his property on the Map. Instead, the Petitioner submitted a different map of a portion of the City of Madison which included his property.

    
    

15. Rules 10-13.006 and 10-13.007, Florida Administrative Code, require that protests of the bid specifications of the Department must be filed within

    72 hours of receipt of notice of the bid specifications.

    
    

16. The ITB did not indicate that persons adversely affected by the ITB could challenge the specifications of the ITB or that any such challenge had to be filed within 72 hours of receipt of notice of the ITB.

    
    

17. The following statement appears of the last page of the Bid Submittal Form included with the ITB and submitted by the Petitioner:

    
    

    I hereby certify as owner, officer, or authorized agent that I have read the Invitation to Bid Package and all its attachments, and agree to abide by all requirements and conditions contained therein. . . .

    
    

    This certification was signed by the Petitioner.

    
    

18. The Department decided to award the lease to the Intervenor.

    
    

19. The Department determined that the Petitioner's bid should be rejected because the proposed property was located in an excluded area.

    
    

20. The Petitioner filed a Formal Protest and Petition for Formal Administrative Hearing on April 23, 1990, with the Department. The Petitioner challenged the Department's proposed award of the lease to the Intervenor and asserted that he was the lowest and best bidder. The Petitioner did not challenge the specifications of the ITB.

    
    

21. The Department filed a Motion to Dismiss on Mazy 4, 1990.

    
    

22. The Petitioner filed a Motion for Leave to File Amended Petition and an Amended Formal Protest and Petition for Formal Administrative Hearing on May 14, 1990. For the first time, the Petitioner challenged the specifications of the ITB.

    CONCLUSIONS OF LAW

    
    

    1. Jurisdiction.

       
       

23. The Division of Administrative Hearings has jurisdiction of the parties to and the subject matter of this proceeding. Section 120.57(1), Florida Statutes (1989).

    
    

    1. The Petitioner's Challenge to the Specifications of the ITB.

       
       

24. Rule 10-13.006, Florida Administrative Code, provides the following:

    
    

    Any person or firm affected adversely by a decision or intended decision concerning a bid solicitation or by a notice of contract award may file a notice of protest with the Department.

    
    

    Rule 10-13.007, Florida Administrative Code, provides, in pertinent part:

    
    

    1. Any person or firm affected adversely by a notice of contract award or by a bid solicitation shall first, within 72 hours after receipt of that notice or solicitation advise in writing the appropriate departmental purchasing officer or, if an RFP solicitation process was used, the contact person listed in the RFP, of its intent to file a formal written protest. Secondly, they shall, within 10 days after the notice of intent to protest is filed, file a formal written notice of protest with the appropriate Department's staff person.

       
       

25. The evidence proved that the Petitioner did not comply with Rules 10-

    13.006 and 10-13.007, Florida Administrative Code, in challenging the specifications of the ITB. Rather than challenging the specifications of the ITB within 72 hours after their receipt, the Petitioner waited until after his challenge to the Department's proposed award of a contract pursuant to the ITB had been filed with the Division of Administrative Hearings and the Department had filed a Motion to Dismiss.

    
    

26. The Petitioner has suggested that Rule 10-13.011, Florida Administrative Code, titled "Protest Procedures for Real Property Leases," requires challenges to bid solicitations to be filed within 72 hours "after receipt of notice of the agency's decision to award the contract." The Petitioner has argued that this Rule is more specific rule and that it, therefore, modifies the requirement of Rule 10-13.007, Florida Administrative Code. This argument is rejected. Rule 10-13.011, Florida Administrative Code, applies to challenges to proposed decisions of the Department made after the receipt of responses to real property lease solicitations. It does not apply to challenges to the specifications of the Department's solicitations prior to the time the Department makes a decision. Rule 10-13.007, Florida Administrative Code, alone governs challenges to bid specifications.

    
    

27. The Petitioner has also argued that he is not precluded from challenging the specifications of the ITB even though he did not comply with the requirements of Rules 10-13.006 and 10-13.007, Florida Administrative Code, because the Department failed to inform him in writing of his right to challenge

    the specifications. The Petitioner has suggested that he was never given a "clear point of entry" to challenge the ITB specifications. The Petitioner has cited a number of cases in support of his argument. See Capital Copy, Inc. v. University of Florida, 526 So. 2d 988 (Fla. 1st DCA 1988); Capeletti Brothers, Inc. v. Department of Transportation, 499 So. 2d 855 (Fla. 1st DCA 1987); Henry

    v. State Department of Administration, 431 So. 2d 677 (Fla. 1st DCA 1983); Sterman v. Florida State University Board of Regents, 414 So. 2d 1102 (Fla. 1st DCA 1982); and Higgins v. Florida Keys Aqueduct Authority, 403 So. 2d 1042 (Fla. 3d DCA 1981).

    
    

28. None of the cases cited by the Petitioner involve the same factual situation involved in this proceeding. All of those cases involve instances where the person who was not informed of his or her clear point of entry instituted a challenge to the agency's action within a reasonable period of time. In this case, the Petitioner was aware of the requirements and exclusions of the ITB. He was aware that his property was located in an area which had been excluded from consideration by the ITB. Despite his knowledge, the Petitioner filed a response to the ITB instead of challenging the ITB's specifications. In filing his response, the Petitioner certified that he had read the ITB and that he agreed to abide by all the requirements and conditions contained in the ITB. Therefore, the Petitioner agreed to abide by the requirement and condition of the ITB that only property located within the City of Madison other than in the two areas identified on the Map by the two cross- hatched areas was to be considered eligible for the lease to awarded pursuant to the ITB.

    
    

29. After agreeing to be bound by all of the requirements and conditions of the ITB, the Petitioner protested the Department's proposed award of the lease to the Intervenor. Even then the Petitioner did not protest the specifications of the ITB. Only after the Department had filed its Motion to Dismiss did the Petitioner seek to challenge the ITB specifications. Thus the Petitioner waited approximately three months after learning that his property was excluded from consideration to challenge the exclusion of his property.

    
    

30. Based upon the facts of this case, it is concluded that the Petitioner has waived any right he may have had to challenge the specifications of the ITB.

    
    

    1. The Petitioner's Property was Not Eligible for Award of a Lease Pursuant to the ITB.

    
    

31. The Petitioner has argued that the designation by the Department of the areas which include property excluded from eligibility to receive an award of the lease to be awarded pursuant to the ITB was ambiguous. Therefore, the Petitioner suggests that he has standing to challenge the Department's proposed award of the lease to the Intervenor.

    
    

32. Based upon the weight of the evidence presented at the formal hearing, it is concluded that the Map is not ambiguous. Although the Petitioner presented testimony suggesting that he did not understand that his property was excluded from consideration pursuant to the Map, the weight of evidence proved that even the Petitioner knew that his property was within an excluded area before he spoke to a representative of the Department. Although the evidence did prove that the Map could have been drawn more precisely, it did not prove that the Map was ambiguous.

33. Based upon the finding that the Map was not ambiguous and the finding that the Petitioner's proposed property is located within one of the two designated excluded areas, the Department correctly concluded that the Petitioner's response to the ITB was not responsive. The Petitioner has failed, therefore, to prove that he has offered property located within the area designated by the Department as the area it is seeking to lease property within. Accordingly, the Petitioner lacks standing to challenge the Department's proposed award of a lease pursuant to the ITB to the Intervenor. See Westinghouse Electric Corporation v. Jacksonville Transportation Authority, 491 So. 2d 1238 (Fla. 1st DCA 1986). The Petitioner lacks standing to assert that its bid was the lowest and best bid and he lacks standing to assert that a contract should not be awarded to the Intervenor because the Intervenor's bid was the only responsive bid.

RECOMMENDATION

Based upon the foregoing Findings of Fact and Conclusions of Law, it is RECOMMENDED that the Department enter a final order granting the

Department's Motion to Dismiss and dismissing with prejudice the Formal Protest

and Petition for Formal Administrative Hearing filed by the Petitioner.

DONE and ENTERED this 12th day of July, 1990, in Tallahassee, Florida.

LARRY J. SARTIN

Hearing Officer

Division of Administrative Hearings The DeSoto Building

1230 Apalachee Parkway

Tallahassee, Florida 32399-1550

(904) 488-9675

Filed with the Clerk of the Division of Administrative Hearings this 12th day of July, 1990.

APPENDIX

The Petitioner and the Department have submitted proposed findings of fact. It has been noted below which proposed findings of fact have been generally accepted and the paragraph number(s) in the Recommended Order where they have been accepted, if any. Those proposed findings of fact which have been rejected and the reason for their rejection have also been noted.

The Petitioner's Proposed Findings of Fact

Proposed Finding Paragraph Number in Recommended Order of Fact Number of Acceptance or Reason for Rejection

1-2 See 9.

3-5 Not supported by the weight of the evidence.

6 6-7.

7 and 11 Not relevant.

8-10 and 12-15 These proposed findings are consistent

with Ms. Goodman's testimony. Ms. Goodman's opinions, however, are not supported by the weight of the evidence.

1. Although this proposed finding of fact is generally true, the weight of the evidence failed to prove that the Petitioner was not aware that both

   cross-hatched areas were excluded areas.

2. See 9.

The Department's Proposed Findings of Fact

Proposed Finding Paragraph Number in Recommended Order of Fact Number of Acceptance or Reason for Rejection

1 1.

2 2 and hereby accepted.

3 5-8.

4 7.

5 6.

6 12.

7 9.

8 13 and 17.

9 4.

10 12.

11 17.

12 15.

13 16.

14 18 and hereby accepted.

15 20.

1. 21 and hereby accepted.

2. 22 and hereby accepted.

3. Hereby accepted.

4. Cumulative.

5. Hereby accepted.

Copies Furnished To:

John C. Pelham, Esquire Gary Walker, Esquire Post Office Box 13527

Tallahassee, Florida 32317-3527

John L. Pearce, Esquire District Legal Counsel Department of Health and

Rehabilitative Services 2639 North Monroe Street

Tallahassee, Florida 32303-2949

Clay A. Schnitker, Esquire Post Office Drawer 652 Madison, Florida 32340

Sam Power, Agency Clerk Department of Health and

Rehabilitative Services 1323 Winewood Boulevard

Tallahassee, Florida 32399-0500

Docket for Case No: 90-002653BID

Orders for Case No: 90-002653BID