Errors in bid documents

Whoever was in charge of the final review of the documents submitted by Optimal Infrastructure Development Inc., the corporate vehicle used by San Miguel Corp. to bid for the Cavite-Laguna Expressway project, to the Department of Public Works and Highways (DPWH) is in big trouble.

The security bid submitted by Optimal is effective up to Nov. 25, four days short of the 180-day period required by the bidding rules that falls on Nov. 29.

This deficiency prompted the other bidders to question the validity of Optimal’s bid, including the manner by which its bid documents were labeled and packaged.

They claimed Optimal’s failure to comply with the security bid requirement is a ground for its automatic disqualification from the bidding.

In response, Optimal said its bid was fully compliant because the security issuer, ANZ Bank, had already certified that the bid security was valid until Nov. 29.

Optimal President Mark Dumol chided the protesting bidders for making a big issue over the appearance of the bid documents boxes and minor technical discrepancies.

Nothing doing.

The DPWH disqualified Optimal from the bidding and, barring any restraining order from a court, would proceed with the opening of the bids.

Optimal has served notice that it will exhaust all legal means to get back into the running.

Examination

For lawyers, accountants, investment bankers and other professionals who have participated in the preparation of complex financial and technical documents, the kind of error committed by Optimal is something that is sought to be earnestly avoided, but can happen even to the best in the field in spite of due diligence.

Although the preparation and review of documents have been made a lot easier by sophisticated computer software and apps that can call attention to inaccuracies and miscalculations, it is still the human brain that makes the final decision on the deliverable product.

When a person has been reading and re-reading the same materials for extended periods of time, it is unavoidable that a mental picture of what the reader wants to see, rather than what’s on the paper itself, forms in his mind.

In a state of mental fatigue, the unconscious intellect sometimes misinterprets the facts and figures conveyed to it by the human eye.

Thus, in the final preparation of voluminous documents, it’s advisable that people who are knowledgeable with the transaction but did not participate in the drafting of the papers be asked to take a second look at them.

With no pre-set ideas or impressions to influence their review, the fresh set of eyes can detect possible errors, discrepancies or omissions, including wrong grammar, that may have escaped notice by the people who prepared the documents.

Deliberation

So who may have committed the booboo in the preparation of Optimal’s security bid?

It could be the lawyer who erred in the calendar count, or the issuer of the security cover who misread the terms of reference of the project, or the head of the panel who did not bother to check the major points for accuracy or completeness.

Excuses aside, the fact remains the security bid does not comply with the validity period prescribed by the bidding rules.

But is the error serious enough to warrant Optimal’s outright disqualification? Were the other bidders unduly prejudiced by the inadvertence? Did the government suffer any loss or disadvantage as a result of the four-day deficiency?

No.

All the parties to the transaction are still in the preliminary stage of the bidding process and the bids have yet to opened.

Ahead of the opening of the bids, the mistake has been rectified since ANZ Bank, the security cover issuer, has confirmed that its warranty is good up to the period required by the rules.

Thus, the exigency that the security bid in question is meant to address has ceased to exist.

The government is amply protected from the adverse consequences of Optimal prematurely pulling out of the bid or reneging on its commitments on the project.

Remedies

The resort to technicalities by the other bidders does not come as a surprise. In highly competitive bidding contests for big ticket projects, the contending parties will do anything and everything legally possible to win the award.

Skillfully handled (or exploited), technicalities can sometimes spell the difference between victory and defeat.

Although permissible, the use of technicalities is frowned upon by our courts if it tends to or aims to divert attention from the true merits of a case, or cause undue prejudice to the affected party.

The resolution of the main issues, not peripheral or side issues, should be the principal objective of the parties.

In evaluating the bids for the instant project, the government should be guided only by the best interests of the public.

Who among the bidders can build and operate that road link at the least cost, with the best materials and on terms and conditions that will be most beneficial to its intended users?

It’s noteworthy that this project has drawn the interest of four of the most profitable and well managed companies of the country—Aboitiz Land, Ayala Corp., Metro Pacific Investments Corp. and San Miguel Corp.

There is some degree of assurance that, considering their proven financial capacity and managerial expertise, whoever wins will be able to deliver on its promises to the government.

By disqualifying Optimal on a technicality, the government has reduced the field from which it can choose the bid that will best serve the interests of the people.

If the business conglomerate behind Optimal were a fly-by-night company or did not have a good track record on delivering on its promises, the disqualification would have been easy to accept.

But it’s not; its early completion of the Tarlac-Pangasinan-La Union Expressway is a testament to its competence to build toll roads.

The bidders are all Big Boys in the infrastructure construction and operation business.

They can rise and fall on their own merits without trivial issues getting into the way of a productive bidding process.

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