cancellation of award due to non-delivery of unit within the delivery period

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cancellation of award due to non-delivery of unit within the delivery period

Post by shark on Thu Aug 22, 2013 10:30 am

Good day!


An end-user requested for a procurement of a brand new motor grader.

It has been published, scheduled for a public bidding, evaluated, and awarded.

More than a month after the receipt of Purchase Order by the winning bidder, it has been found out by the BAC
that there was a discrepancy in the awarding of abovementioned equipment:

1. No brand name was specified, only model of the equipment
2. As per research throught the internet, price quotation made by the winning bidder is higher compared to the
usual price of the unit

The winning bidder was not been able to deliver the unit within the given delivery period but submitted a letter
requesting for an extension of their delivery period.

Our BAC would like to inquire/verify the following:

1. Is it okay to cancel the award, noting that the winning bidder was not able to deliver the unit within the given
delivery period?
2. Is there any possible sanction for the BAC regarding the the above matter?

We are looking forward for your immediate response.

Thank you and God bless!


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Re: cancellation of award due to non-delivery of unit within the delivery period

Post by Jovinal on Thu Aug 22, 2013 10:57 am

The contractor is at default, you may cancel or terminate the contact and apply the negotiated procurement mode for other eligible contractor.

The contractor may be blacklisted.
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Re: cancellation of award due to non-delivery of unit within the delivery period

Post by regina avelino on Fri Aug 23, 2013 9:20 am

shark wrote:Good day!


Our BAC would like to inquire/verify the following:

1. Is it okay to cancel the award, noting that the winning bidder was not able to deliver the unit within the given
  delivery period?
2. Is there any possible sanction for the BAC regarding the the above matter?


1.   You must follow procedures and due process.  At the instant case you have, I would like to cite the provisions of the IRR of RA 9184 with regard to supplier's delivery:

"When the supplier fails to satisfactorily deliver goods under the contract within the specified delivery schedule, inclusive of duly granted time extensions, if any, the supplier shall be liable for damages for the delay and shall pay the procuring entity liquidated damages, not by way of penalty, an amount equal to one-tenth (1/10) of one percent (1%) of the cost of the delayed goods scheduled for delivery for every day of delay until such goods are finally delivered and accepted by the procuring entity concerned."

Further....

"In no case shall the total sum of liquidated damages exceed ten percent (10%) of the total contract price, in which event the procuring entity concerned shall automatically rescind the contract and impose appropriate sanctions over and above the liquidated damages to be paid."

2.  In my opinion, it is not the responsibility of the BAC as the end-user should have made the necessary costing and study on what should be the ABC.  BAC shall only be responsible if and when they did not follow the required bidding procedures as provided under section 41-Reservation clause (b).

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Re: cancellation of award due to non-delivery of unit within the delivery period

Post by shark on Tue Aug 27, 2013 3:19 pm

thank you Sir Jovenal and Ma'am Regina Smile 
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