L.P. ROYER INC.
v.
DEPARTMENT OF PUBLIC WORKS AND GOVERNMENT SERVICES
File No. PR-2016-030

Determination issued
Tuesday, January 10, 2017

Reasons issued
Wednesday, January 25, 2017

 

TABLE OF CONTENTS

• DETERMINATION
• STATEMENT OF REASONS
  • SUMMARY
  • BACKGROUND OF THE COMPLAINT
  • RELEVANT PROVISIONS OF THE RFP
  • ANALYSIS
    • Rejection of Royer’s Proposal
    • PWGSC Did not Award the Designated Contract in Accordance With the Criteria in the RFP
    • PWGSC Applied an Undisclosed Criterion
    • User Trials
    • PWGSC Did not Evaluate Royer’s Proposal as Received
  • REMEDY
  • COSTS
  • DETERMINATION OF THE TRIBUNAL

 

IN THE MATTER OF a complaint filed by L.P. Royer Inc. pursuant to subsection 30.11(1) of the Canadian International Trade Tribunal Act, R.S.C., 1985, c. 47 (4th Supp.);

AND FURTHER TO a decision to conduct an inquiry into the complaint pursuant to subsection 30.13(1) of the Canadian International Trade Tribunal Act.

BETWEEN

L.P. ROYER INC. Complainant

AND

THE DEPARTMENT OF PUBLIC WORKS AND GOVERNMENT SERVICES Government Institution

DETERMINATION

Pursuant to subsection 30.14(2) of the Canadian International Trade Tribunal Act, the Canadian International Trade Tribunal determines that the complaint is valid.

Pursuant to subsections 30.15(2) and (3) of the Canadian International Trade Tribunal Act, the Canadian International Trade Tribunal recommends, as a remedy, that the Department of Public Works and Government Services compensate L.P. Royer Inc. for the reasonable profits it lost on each pair of mukluks delivered to the Department of Public Works and Government Services by AirBoss Engineered Products Inc. as defined in the existing contract and, as such, until AirBoss Engineered Products Inc. has completed all such deliveries.

If the Department of Public Works and Government Services decides to terminate the existing contract with AirBoss Engineered Products Inc., a new contract for the provision of mukluks equal to the balance of mukluks remaining on the contract with AirBoss Engineered Products Inc. not yet provided to the Department of Public Works and Government Services must be awarded to L.P. Royer Inc. if the Department of Public Works and Government Services still has procurement needs in this regard. Concerning the termination of the existing contract, the Canadian International Trade Tribunal will let the Department of Public Works and Government Services determine its feasibility with regard to the consequences of stocking two models of mukluks from two different suppliers, among other things.

If the Department of Public Works and Government Services decides that it has met its procurement needs for mukluks without having to obtain from L.P. Royer Inc. a number of mukluks not yet provided by AirBoss Engineered Products Inc., L.P. Royer Inc. will be awarded its reasonable costs incurred in preparing its bid on the basis of the difference between the number of mukluks not yet provided by AirBoss Engineered Products Inc. under the contract and the total number of mukluks to be procured under the contract, without taking into account the option period.

Furthermore, the Canadian International Trade Tribunal recommends that the option to extend the contract not be exercised unless L.P. Royer Inc. is awarded a new contract for the option period.

The Canadian International Trade Tribunal asks that the parties reach an agreement on the next steps, negotiate the quantum of compensation and, within 30 days of the publication of the statement of reasons, report back to the Canadian International Trade Tribunal on the outcome. Should the parties fail to reach an agreement, the Canadian International Trade Tribunal will ask them to file additional submissions on the quantum of compensation at 15-day intervals, beginning with L.P. Royer Inc., and reserves the right to establish any additional compensation it deems necessary following the parties’ submissions. The Canadian International Trade Tribunal also reserves the right to establish the final compensation amount to be awarded to L.P. Royer Inc. The Canadian International Trade Tribunal is prepared to assist the parties in reaching an agreement should they make a joint request in this regard.

Pursuant to section 30.16 of the Canadian International Trade Tribunal Act, the Canadian International Trade Tribunal awards L.P. Royer Inc. its reasonable costs incurred in preparing and proceeding with the complaint, which costs are to be paid by the Department of Public Works and Government Services. In accordance with the Procurement Costs Guideline, the Canadian International Trade Tribunal’s preliminary indication of the level of complexity for this complaint case is Level 1, and its preliminary indication of the amount of the cost award is $1,150. If any party disagrees with the preliminary indication of the level of complexity or the preliminary indication of the amount of the cost award, it may make submissions to the Canadian International Trade Tribunal, as contemplated in article 4.2 of the Procurement Costs Guideline. The Canadian International Trade Tribunal reserves jurisdiction to establish the final amount of the award.

Jason W. Downey
Jason W. Downey
Presiding Member

The statement of reasons will be issued at a later date.

Tribunal Panel: Jason W. Downey, Presiding Member

Support Staff: Eric Wildhaber, Counsel
Stéphanie Desjardins, Student-at-law

Complainant: L.P. Royer Inc.

Counsel for the Complainant: Dominique Gilbert

Government Institution: Department of Public Works and Government Services

Counsel for the Government Institution: Mélyne Félix
Benoît de Champlain

Please address all communications to:

The Registrar
Secretariat to the Canadian International Trade Tribunal
333 Laurier Avenue West
15th Floor
Ottawa, Ontario  K1A 0G7

Telephone: 613-993-3595
Fax: 613-990-2439
E-mail: citt-tcce@tribunal.gc.ca

STATEMENT OF REASONS

SUMMARY

1. On August 26, 2016, L.P. Royer Inc. (Royer) filed a complaint with the Canadian International Trade Tribunal (the Tribunal) pursuant to subsection 30.11(1) of the Canadian International Trade Tribunal Act^[1] regarding a Request for Proposal (RFP) (Solicitation No. W8486-151946/A) issued by the Department of Public Works and Government Services (PWGSC) on behalf of the Department of National Defence (DND). The RFP was for the purchase of Mukluk boots (mukluks) for extreme cold weather (i.e. between 0 and -51 degrees Celsius) and certain components for Canadian Armed Forces personnel.
2. Royer alleged that PWGSC erroneously determined that its proposed mukluks did not meet the mandatory criteria of the RFP.
3. PWGSC rejected Royer’s bid for the following two reasons: (1) PWGSC was of the view that Royer’s mukluks failed to withstand conditions in the field; and (2) the mukluks were not ready for mass production.
4. Royer claimed that the evaluation of its mukluks was not carried out based on the criteria set out in the RFP and that they were, in fact, ready to be mass produced.
5. In its defence, PWGSC claimed that Royer later sought to replace the model of mukluks submitted in its proposal with an improved model. PWGSC further claimed that it had to put an end to the evaluation of Royer’s mukluks because they could not withstand the “extreme conditions” set out in the RFP.
6. As a remedy, Royer requested that the contract awarded pursuant to the RFP be cancelled and that it be awarded the designated contract. In the alternative, Royer requested that the bids submitted in the tender be re-evaluated or that the procurement be re-tendered. Royer requested compensation for lost profits and reimbursement of its bid and complaint preparation costs.
7. For the reasons set out below, the Tribunal finds the complaint to be valid. PWGSC failed to award the designated contract according to the criteria set out in the RFP. In so doing, PWGSC applied a criterion that was not set out in the RFP and, thus, acted without justification.

BACKGROUND OF THE COMPLAINT

8. On August 26, 2016, Royer filed its complaint with the Tribunal.
9. On September 6, 2016, the Tribunal informed the parties that it had decided to conduct an inquiry into the complaint, as it met the requirements of subsection 30.13(1) of the CITT Act and the conditions set out in subsection 7(1) of the Canadian International Trade Tribunal Procurement Inquiry Regulations.^[2]
10. On September 21, 2016, AirBoss Engineered Products Inc. (AirBoss Defense) requested intervener status, which was granted by the Tribunal on September 28, 2016.
11. On September 30, 2016, AirBoss Defense requested a copy of the evaluation report on Royer (exhibit accompanying Exhibit P-13 of the complaint) from the Tribunal. Given the confidential nature of the exhibit, AirBoss Defense subsequently withdrew its request. Aside from this, AirBoss Defense’s intervention was limited to brief remarks indicating its agreement with the positions put forth by PWGSC.
12. On September 26, 2016, PWGSC requested that the Tribunal grant it until October 11, 2016, to file its Government Institution Report (GIR). The Tribunal granted the request on September 28, 2016, and notified the parties that the extended 135-day period process would be applied to the inquiry in accordance with subsection 12(c) of the Regulations.
13. On October 11, 2016, PWGSC filed its GIR.
14. On October 14, 2016, AirBoss Defense filed its comments.
15. On November 14, 2016, Royer filed its comments on the GIR.
16. On November 22, 2016, PWGSC informed that it would not be filing additional comments but noted that exhibits P-14 and P-15 accompanying Royer’s comments on the GIR were new documents that had not been included in the complaint.
17. Given that there was sufficient information in the record to determine the validity of the complaint, the Tribunal decided that a hearing was not required and disposed of the complaint on the basis of the written information on the record.

RELEVANT PROVISIONS OF THE RFP

18. The basis of selection of the RFP provided as follows:

    4.2 Basis of Selection

    A bid must comply with all requirements of the bid solicitation and meet all mandatory technical and financial evaluation criteria to be declared responsive.

    4.2.1 Trial Contracts

    The responsive proposals with the lowest cost per point will be recommended for award of a Trial contract (up to a maximum of three contracts).

    . . .

    4.2.2 Main Contract

    To be declared responsive, a bid must meet the criteria at Annex G.

    The responsive bid with the highest score in the User Evaluation Trial will be recommended for award of the Main Contract.

    . . .

    [Emphasis added, translation]

19. Annex B of the RFP, “Performance Specification for the Canadian Forces Product Improved Extreme Cold Weather Mukluk (PIECWM) Assembly”, defines the performance criteria required for the manufacture and procurement of the mukluks. In particular, Annex B identifies performance requirements as being either essential (indicated by the word “must”) or desirable (indicated by the word “should”).^[3]
20. PWGSC’s decision to declare Royer’s bid non-responsive was based on article 2.1 of Annex B, which provides as follows:

    2. PERFORMANCE REQUIREMENTS – WHOLE BOOT

    2.1 General: The PIECWM Assembly design must incorporate fabrics and materials to ensure the foot (to ankle height) remains dry from exterior sources. Materials used in the production of this item are expected to be of standard commercial practice but must be modified, if necessary, in order to meet the needs and requirements of CF members in the environment for which the item is intended. It is expected that all materials used to meet the Performance Specification will hold up under the extreme conditions found in Field, Garrison and Combat operations conducted under extreme conditions described below. Materials should be selected to optimize the overall boot performance for the given environment, not specifically address a single measure of performance (i.e., weight, comfort, water absorption, etc.). The quality and workmanship of the item is expected to exceed that found in the commercial market, given the environment for which the item is intended. Any design utilized must be production-ready utilizing conventional mass production methods.

    [Emphasis added, translation]

21. The RFP contained three evaluation phases. They will be further examined below, as the manner of their organization is important for the purposes hereof. The third phase of the evaluation is of critical importance in this matter. Article 4.1.1.3 of the RFP describes Phase 3 of the evaluation procedure as follows:

    4.1.1.3 Phase III – User Evaluation Trial

    Following the award of the Trial Contracts, the Contractor must supply 50 Mukluk shells and 100 pairs of removable liner(s), removable insole(s) and replacement laces as per Annex F and H within 90 calendar days of the award date. A technical evaluation will be completed in accordance with Annex F on all trial quantities. Failure to supply the goods within the specified time frame will result in the bid for the Main Contract being declared non-responsive. Details of the user evaluation are included in Annex G.

    [Emphasis added, translation]

22. Annex F of the RFP, “Pre-Trial Technical Evaluation Plan for the Product Improved Extreme Cold Weather Mukluk (PIECWM) Assembly”, describes the manner in which DND should conduct the pre-trial technical evaluation. In particular, article 1.1 of Annex F provides as follows:

    1.1  Evaluation Plan. This annex describes how The Department of National Defence (DND) is to perform the pre-trial technical evaluation of the Product Improved Extreme Cold Weather Mukluk (PIECWM) Assembly in terms of evaluating physical samples for the quality of workmanship and construction, for their ability to demonstrate capability to meet requisite technologies outlined in Annex B. The pre-trial workmanship and construction evaluation will be performed by a team of DND Subject Matter Experts (SMEs).

    [Emphasis added, translation]

23. Article 1.1 of Annex G of the RFP, “User Evaluation for the Product Improved Extreme Cold Weather Mukluk (PIECWM) Assembly”, describes how DND should conduct the user evaluation of the footwear submitted as follows:

    1.1 This annex describes how The Department of National Defence (DND) will perform a user evaluation of footwear submitted in response to Annex B (DSSPM 2-3-87-PIECWM Performance Specification for the Extreme Cold Weather Mukluk (PIECWM) Assembly). The user evaluation will confirm if proposed mukluk assemblies meet the identified performance requirements for Canadian Armed Forces personnel.

    [Emphasis added, translation]

24. The Tribunal acknowledges the role of soldiers in the evaluation process of the mukluks in issue.
25. Article 1.6.3 sets out the mandatory criteria in order to confirm whether the mukluk assemblies meet the performance criteria as follows:

    1.6.3 To confirm if the proposed mukluk assemblies meet the identified performance requirements for Canadian Armed Forces personnel, the proposed mukluk assemblies must meet all of the following criteria to be considered compliant:

    a. The average score for the proposed mukluk assembly must be greater than the average score of the current in-service mukluks; and

    b. The average score for the proposed mukluk assembly must be equal to or greater than 57% of the Maximum Possible Score of 119 (7 points x 17 questions).

    [Emphasis added, translation]

26. Article 1.3.3 of Annex G describes the user evaluation procedure as follows:

    The user evaluation will consist of approximately four weeks total of user evaluation, depending on weather and number of bid products received. Soldiers will be given approximately one week of evaluation familiarization and training using the in-service mukluk assembly to ensure they understand the tasks and measurements to be done, followed by up to 3 weeks of concurrent evaluation of proposed mukluk assemblies.

    [Emphasis added, translation]

27. The French version of article 1.3.3 of Annex G provides as follows:

    L’évaluation par l’utilisateur se déroulera pendant quatre semaines environ, selon le climat et le nombre de produits proposés. Les soldats auront environ une semaine pour se familiariser avec l’évaluation et participer à un entraînement en étant chaussés des mukluks utilisés en service pour bien comprendre les tâches à faire et les mesures à prendre, puis ils disposeront de trois semaines pour évaluer les mukluks proposés par les soumissionnaires.

    [Emphasis added]

28. Article 1.4.4 of Annex G (article 1.4.5 in the French version) sets out the mandatory performance criteria as follows:

    1.4.4 The current in-service mukluk assembly and proposed mukluk assemblies will be evaluated by answering questions based on the following mandatory performance requirements and/or design criteria:

    i. Thermal protection;

    ii. Performance during tasks/activities such as marching (no load, with full fighting order, and with marching order), running and operating Canadian Army vehicles;

    iii. Moisture management;

    iv. Performance of adjustable snow cuff;

    v. Drying rate;

    vi. Slip resistance;

    vii. Dissipation of excess perspiration;

    viii. Physical comfort;

    ix. Donning and doffing;

    x. Liner bulk when packing in rucksack;

    xi. Performance of lacing system;

    xii. Support to foot;

    xiii. Range of motion of foot;

    xiv. Ease of use with gloved hands;

    xv. Compatibility with snowshoes;

    xvi. Compatibility with clothing; and

    xvii. Fit assessment.

    [Emphasis added, translation]

29. Article 1.5 of Annex G describes the final evaluation procedure as follows:

    1.5  Final Evaluation. The final user evaluation will consist of a questionnaire designed to allow participants to rate the performance of the proposed mukluk assemblies for each of the criteria above. Each question will have equal weighing. Ratings will be done using a seven (7) point scale (see Figure 1).

    [Translation]

    The Tribunal also notes that the scale referred to in article 1.5 ranged from “Totally Unacceptable” to “Perfectly Acceptable”.

30. Article 1.6 of Annex G describes the method for calculating the average score for user evaluations.

ANALYSIS

31. Subsection 30.14(1) of the CITT Act provides that the Tribunal shall limit its considerations to the subject matter of the complaint. After conducting an inquiry, the Tribunal determines whether the complaint is valid on the basis of the procedures and other requirements prescribed by regulation in respect of the designated contract. Under section 11 of the Regulations, the Tribunal determines whether the procurement was conducted in accordance with the requirements set out in the applicable trade agreements—in this case, the Agreement on Internal Trade.^[4]
32. The analysis of this case will begin with a review of the circumstances surrounding the rejection of Royer’s proposal.

Rejection of Royer’s Proposal

33. The RFP was published on May 6, 2015, with a bid closing date of August 11, 2015.
34. On August 10, 2015, Royer responded to the RFP by submitting two proposals (ECWM-01 – simple boots and ECWM-02 – complex boots). This complaint is limited to the first proposal.
35. The proposals were to be evaluated in a three-phase process. Royer passed the first two phases of the evaluation and, in so doing, supplied PWGSC with a certain number of mukluks for additional evaluation, in accordance with the “trial contract” for the third phase. The complaint essentially concerns the third phase of the evaluation.^[5]
36. Phase 3 of the evaluation was itself divided into two steps. The first step in Phase 3—which for our purposes we will call Phase 3(a)—was designed to assess quality of workmanship and conformance to technologies outlined in Annex B to the RFP. This step essentially consisted of a physical inspection of the mukluks to determine their compliance with the information in the bid. The second step in Phase 3—which for our purposes we will call Phase 3(b)—consisted of an evaluation “in the field” during which soldiers had to wear the mukluks for a certain time and then fill out an evaluation questionnaire, in accordance with Annex G to the RFP.
37. Royer delivered its mukluks to PWGSC on December 17, 2015, in accordance with the trial contract for the purposes of Phase 3 of the evaluation, which could therefore begin at that time. AirBoss Defense was the only other bidder in the running at that stage.
38. Since it had not yet received any news about the results of Phase 3 of the evaluation, Royer sent PWGSC letters, dated April 20 and June 1, 2016, to follow up on the matter. This correspondence was one-way and was not in response to any questions from PWGSC. In the letters, Royer stated that it had conducted its own technical trials and had used them to make improvements to its product. PWGSC simply acknowledged receipt of both letters without any further comment.
39. On July 8, 2016, PWGSC notified Royer that the contract had been awarded to AirBoss Defense, which had received a score of 76 per cent in the field trials. Royer later learned that its score of 79.8 per cent was higher than AirBoss Defense’s score. Royer also learned that its bid had been rejected for the following reasons:

    i. The materials used in the liner submission failed to “hold up under the extreme conditions found in Field, Garrison and Combat operations”.

    ii. Bidder B’s proposed submission is not “production-ready” as the liner would require additional development, the materials and boot assembly utilized would require re-testing in order to comply with the performance mandatories, and the boot assembly would require UAPE in order to determine compliance.^[6]

40. On July 18, 2016, Royer made an objection to PWGSC in accordance with section 6 of the Regulations.
41. On August 19, 2016, PWGSC rejected the objection. The Tribunal notes an important fact: this is when Royer learned that the soldiers had in fact preferred its mukluks to those of Airboss Defense in user trials.
42. Indeed, while PWGSC had previously stated that the evaluation of Royer’s mukluks had not been completed, PWGSC was now telling Royer that “the evaluation of [Royer]’s proposal was completed with due care, in an objective and impartial manner” [translation] and that “all the evaluation steps described in the solicitation were followed in the same manner for all bidders” [translation].
43. This same letter, dated August 19, 2016, informed Royer that its mukluks had received an “acceptable” overall performance rating from users and an average score of 79.8 per cent. PWGSC reiterated, however, that Royer’s proposal had been rejected “owing to signs of wear exceeding the tolerances in the solicitation” [translation], referring to article 2.1 of Annex B to the RFP.
44. Some confusion thus arose as to the evaluation process itself, its steps and the reasons surrounding the rejection of Royer’s bid. The Tribunal questions PWGSC’s statement to the effect that “the lining submitted did not ‘hold up under the extreme conditions found in Field, Garrison and Combat operations’” [translation], given that the soldiers had preferred Royer’s mukluks to those of AirBoss Defense to the point of giving them a higher evaluation rating.

PWGSC Did not Award the Designated Contract in Accordance With the Criteria in the RFP

45. Article 506(6) of the AIT states that “[t]he tender documents shall clearly identify the requirements of the procurement, the criteria that will be used in the evaluation of bids and the methods of weighting and evaluating the criteria.”
46. It is well established that a procuring entity will meet these obligations when it conducts a reasonable evaluation consistent with the terms provided in the RFP. As it has stated in the past, unless the evaluators have not applied themselves in evaluating a bidder’s proposal, have ignored vital information provided in a bid or have based their evaluation on undisclosed criteria, the Tribunal will not substitute its judgment for that of the evaluators.^[7]
47. In this case, PWGSC did not award the designated contract in accordance with the evaluation criteria in the RFP.
48. Indeed, article 4.2.2 of the RFP stated that “[t]he responsive bid with the highest score in the User Evaluation Trial will be recommended for award of the Main Contract” [translation],^[8] that is, the “designated contract”. Simply put, this was the ultimate evaluation criterion for awarding the designated contract. In other words, the RFP had been structured so that, among the mukluks that made it to Phase 3(b) of the evaluation, the ultimate choice would depend solely on the preference of the soldiers who had evaluated the product.
49. The evidence on record clearly shows that Royer’s mukluks received the highest average user evaluation score, 79.8 per cent. Consequently, the designated contract should have been awarded to Royer.
50. Given that this did not happen, PWGSC’s decision is unreasonable, and the Tribunal’s intervention is warranted, as PWGSC’s decision was not based on the criteria identified in the RFP.^[9]

PWGSC Applied an Undisclosed Criterion

51. PWGSC argued that it was entitled to reject Royer’s proposal because the trials in Phase 3(b) of the evaluation had revealed “signs of wear exceeding the tolerances in the solicitation” [translation], given that 14 of the 18 trial mukluks demonstrated “mechanical abrasions on the lining, at the heal” [translation] and that, for this reason, “it is clear that the materials used in the construction of the boots did not hold up under the extreme conditions described in Annex B and, therefore, did not meet the requirements of the performance specification in Annex B” [translation].
52. PWGSC’s position is ill-founded, as PWGSC erred with regard to the sequence of the method and evaluation criteria that it itself set out in the RFP.
53. As was stated above, the mukluks that had passed Phase 1 and Phase 2 of the evaluation underwent Phase 3 of the evaluation. Phase 3(a) was designed to evaluate quality of workmanship and conformance to the required specifications in Annex B to the RFP, but only “prior to the user trials”^{[10] [emphasis added, translation] in Phase 3(b), which themselves were used to evaluate the criteria in Annex G to the RFP.}
54. Here, PWGSC attempted to apply a criterion from Annex B in Phase 3(b), whereas only the criteria identified in Annex G are applicable at that stage of the evaluation. According to the RFP, the examination of the mukluks in accordance with the performance specifications in Annex B, including the presence of abrasions, was not supposed to happen after the trials, but before—using samples that had not yet been worn. According to the terms of the RFP, the mukluks could not have been re-evaluated in such a manner after having been subjected to field use.
55. The sequence of steps in the RFP is clear, and the PWGSC evaluators could not conduct an additional unplanned evaluation at this stage, after the evaluation conducted by the soldiers.
56. The Tribunal is of the view that the RFP was structured in such a way that the mukluks could not be disqualified on the basis of wear caused during the user evaluation trials. Therefore, PWGSC cannot rely on the reason it invoked for disqualifying Royer—that “following the trials, its boots demonstrated signs of wear exceeding the tolerances outlined in the solicitation” [translation]—precisely because the RFP contained no such criterion or “tolerances”. This is either a case of failure to respect the sequence of steps in the evaluation process or an arbitrary addition of a new evaluation procedure, both cases necessarily being non-compliant procedures.
57. Some might note that the absence of such a basis for disqualification in the RFP is odd, even surprising, and that this might indicate a deficiency in the design of PWGSC’s procurement methodology. However, the Tribunal cannot remedy the evaluation method selected by PWGSC, which is clearly stated in the RFP. On the contrary, the Tribunal must limit its considerations to the application of the criteria as stated in the RFP. Again, the RFP stipulates that the designated contract will be awarded to “[t]he responsive bid with the highest score in the User Evaluation Trial”.
58. Accordingly, the Tribunal has no choice but to find that PWGSC applied an undisclosed criterion in the evaluation of Royer’s proposal. In so doing, PWGSC violated Article 506(6) of the AIT.

User Trials

59. PWGSC defended itself by arguing that the average score obtained by Royer during the user trials was only “theoretical” [translation] because it had somehow interrupted the evaluation of Royer’s mukluks. The Tribunal indeed finds that PWGSC did not use all of the time allotted to the evaluation of Royer’s mukluks. In the Tribunal’s view, PWGSC cannot invoke this fact ex post facto to claim that the results obtained by Royer were invalid.
60. The Tribunal notes that the RFP defined the duration of the evaluation of Phase 3(b) only in very broad terms. Article 1.3.3 of Annex G provided that “[t]he user evaluation will consist of approximately four weeks total of user evaluation” [emphasis added] and that soldiers would be given approximately one week become familiar with the evaluation followed by “up to 3 weeks of concurrent evaluation of proposed mukluks assemblies” [emphasis added]. The French version of the RFP provided the following in regard to the duration of the user evaluation: “disposeront de trois semaines pour évaluer les mukluks proposé[e]s”.
61. Whether they are read separately or together, the Tribunal is of the view that these two versions establish that the RFP provided for an evaluation period of up to four weeks, including up to three weeks of trials of the mukluks in the field, but that there was no obligation for the process to last four full weeks.
62. According to the evidence on the record, the evaluation of the mukluks proposed by Royer took place over a three-week period, including one week of evaluation familiarization for the soldiers and two weeks to evaluate the proposed mukluks.
63. Accordingly, the Tribunal is of the view that the mukluks proposed by Royer are valid and should have been considered by PWGSC in its selection of the successful bidder. Ultimately, the evidence on the record shows that Royer’s mukluks obtained a higher average score than those of AirBoss Defense during Phase 3(b) of the evaluation. Therefore, Royer should have been awarded the designated contract on the basis of the award method set out in the RFP.

PWGSC Did not Evaluate Royer’s Proposal as Received

64. PWGSC justified its disqualification of Royer’s proposal by alleging that Royer had somehow amended its proposal after bid closing and that the mukluks proposed by Royer were, therefore, not ready for mass production, which was a condition in the RFP.^[11]
65. With respect, the Tribunal finds that this allegation has no merit.
66. First, there is a complete lack of evidence supporting PWGSC’s allegation regarding Royer’s capacity to mass produce the proposed mukluks.
67. The Tribunal also finds that the evidence in the record demonstrates that PWGSC did not evaluate Royer’s proposal as received. In fact, upon receiving Royer’s correspondence, PWGSC simply assumed, without any basis, that Royer wished to amend its proposal, which was simply not the case.
68. The sending by Royer of a one-way communication indicating that it, in its own view, had improved a product at no cost to PWGSC, without any response from PWGSC beyond an acknowledgment of receipt, constitutes neither an attempt to cure deficiencies in its bid nor an admission that the proposed product was not ready for production. Quite the opposite is true.
69. The Tribunal has previously warned against making assumptions, which often lead to unfortunate situations.^[12]
70. Ultimately, it is clear that PWGSC could not allow Royer to amend its proposal. Nor could PWGSC claim that it was required to consider this so-called attempt and draw a particular conclusion from it—a position to which the Tribunal does not subscribe. From the outset, PWGSC’s duty was simply to evaluate Royer’s proposal as received; nothing more, nothing less.
71. All things considered, the Tribunal finds that it was PWGSC—and not Royer—that modified the proposal by inserting considerations and/or interpretations by way of inference—thereby causing prejudice to Royer—on the basis of a simple correspondence received during the evaluation period, that is, after the date by which bids could be submitted or amended.
72. Because PWGSC did not evaluate Royer’s proposal as received, the Tribunal finds that the procedure it followed was flawed.
73. Notwithstanding the above, the Tribunal notes that the RFP provided at article 6.B.6.1 for the possibility of modifications to the mukluks, including after contract award, if certain conditions were met.^[13] The Tribunal often sees this kind of boilerplate clause, which is normally found in the administration of B-type contracts, and, therefore, after the evaluation of the A-type contracts^[14] submitted through the competitive process.^[15] Such a clause is not applicable in this case, but remains relevant in terms of understanding PWGSC’s reasoning.

REMEDY

74. Having determined that Royer’s complaint is valid, the Tribunal must recommend an appropriate remedy.
75. In determining the appropriate remedy, the Tribunal must consider all the circumstances relevant to the procurement, as set out in subsection 30.15(3) of the CITT Act. This includes taking into account the seriousness of any deficiency in the procurement process, the degree to which the complainant was prejudiced, the degree to which the integrity and efficiency in the competitive procurement system were prejudiced, and whether the parties acted in good faith.
76. In its complaint, Royer requested all of the remedies listed in the Tribunal’s complaint form.
77. The Tribunal has no choice but to find that PWGSC did not award the contract in accordance with the stated methodology, especially given that the methodology did not provide for a ground for rejecting the bid based on the flaws found by PWGSC with Royer’s mukluks. Basically, PWGSC left it up to the soldiers, who would be the end users, to determine the ultimate choice as to which mukluks would be selected. The soldiers who conducted the user trials preferred Royer’s mukluks, notwithstanding the reported abrasions, and gave them a higher score than they gave to AirBoss Defense. Therefore, Royer should have been awarded the contract.
78. In its analysis, the Tribunal must consider the extent to which the contract has been performed and the practical implications of an immediate switch to Royer for the procurement of mukluks. Given that the parties made few or no submissions regarding the extent to which the contract has been performed or the consequences of a change in suppliers at this stage, the Tribunal reserves the right to ask the parties to file additional submissions on these issues if they cannot agree on the next steps, and to recommend any supplementary remedies.
79. The Tribunal is, therefore, giving the parties 30 days to explore potential approaches to compensating Royer and transferring the contract to it. Should they reach an agreement, it must be submitted to the Tribunal. Should they fail to reach an agreement, the Tribunal will ask them to file submissions at 15-day intervals, beginning with Royer, on the recommendation that the Tribunal should make regarding the quantum of compensation to be paid to Royer.
80. Nevertheless, the Tribunal recommends that Royer be compensated for the reasonable profits it lost on each pair of mukluks delivered to PWGSC under the existing contract and, as such, until AirBoss Defense has completed all such deliveries. At this point, the Tribunal recommends that a new contract for the provision of mukluks equal to the balance of the mukluks remaining on the contract with AirBoss Defense not yet provided to PWGSC be awarded to Royer, if practicable. The Tribunal also recommends that the option period not be exercised, unless a new contract is awarded to Royer. The details of the Tribunal’s recommendation may be found below.

COSTS

81. The Tribunal awards Royer its reasonable costs incurred in preparing and proceeding with the complaint. In determining the amount of the cost award in this case, the Tribunal considered its Procurement Costs Guideline (the Guideline), which contemplates classification of the level of complexity of cases on the basis of three criteria: the complexity of the procurement, the complexity of the complaint and the complexity of the complaint proceedings.
82. The Tribunal’s preliminary indication is that this complaint case has a complexity level corresponding to the lowest level of complexity referred to in Annex A of the Guideline (Level 1). The complexity of the procurement was medium, as it dealt with the procurement of complex goods. The complexity of the complaint was low, in that the matter at issue was an evaluation based on a simple pass-or-fail list of easily measurable features. The complexity of the complaint proceedings was low.
83. Accordingly, as contemplated by the Guideline, the Tribunal’s preliminary indication of the amount of the cost award is $1,150.

DETERMINATION OF THE TRIBUNAL

84. Pursuant to subsection 30.14(2) of the CITT Act, the Tribunal determines that the complaint is valid.
85. Pursuant to subsections 30.15(2) and (3) of the CITT Act, the Tribunal recommends, as a remedy, that PWGSC compensate Royer for the reasonable profits it lost on each pair of mukluks delivered to the PWGSC by AirBoss Defense as defined in the existing contract and, as such, until AirBoss Defense has completed all such deliveries.
86. If PWGSC decides to terminate the existing contract with AirBoss Defense, a new contract for the provision of mukluks equal to the balance of mukluks remaining on the contract with AirBoss Defense not yet provided to PWGSC must be awarded to Royer if PWGSC still has procurement needs in this regard. Concerning the termination of the existing contract, the Tribunal will let PWGSC determine its feasibility with regard to the consequences of stocking two models of mukluks from two different suppliers, among other things.
87. If PWGSC decides that it has met its procurement needs for mukluks without having to obtain from Royer a number of mukluks not yet provided by AirBoss Defense, Royer will be awarded its reasonable costs incurred in preparing its bid on the basis of the difference between the number of mukluks not yet provided by AirBoss Defense under the contract and the total number of mukluks to be procured under the contract, without taking into account the option period.
88. Furthermore, the Tribunal recommends that the option to extend the contract not be exercised unless Royer is awarded a new contract for the option period.
89. The Tribunal asks that the parties reach an agreement on the next steps, negotiate the quantum of compensation and, within 30 days of the publication of the statement of reasons, report back to the Tribunal on the outcome. Should the parties fail to reach an agreement, the Tribunal will ask them to file additional submissions on the quantum of compensation at 15-day intervals, beginning with Royer, and reserves the right to establish any additional compensation it deems necessary following the parties’ submissions. The Tribunal also reserves the right to establish the final compensation amount to be awarded to Royer. The Tribunal is prepared to assist the parties in reaching an agreement should they make a joint request in this regard.
90. Pursuant to section 30.16 of the CITT Act, the Tribunal awards Royer its reasonable costs incurred in preparing and proceeding with the complaint, which costs are to be paid by PWGSC. In accordance with the Guideline, the Tribunal’s preliminary indication of the level of complexity for this complaint case is Level 1, and its preliminary indication of the amount of the cost award is $1,150. If any party disagrees with the preliminary indication of the level of complexity or the preliminary indication of the amount of the cost award, it may make submissions to the Tribunal, as contemplated in article 4.2 of the Guideline. The Tribunal reserves jurisdiction to establish the final amount of the award.