Avoiding Litigation on your RFPs[1]

By Michael Asner

Michael Asner Consulting

(604) 530-7881

michael@rfpmentor.com

            Over the past ten years, I’ve spent a lot of time discussing legal issues with public sector procurement executives. We’ve discussed laws and regulations, best practices, and litigation. We’ve discussed avoiding litigation as a significant, yet unwritten part of the procurement function. These discussions often deal with best practices, things that we can do which will reduce the probability of being sued. Or, if we are sued, increase the probability that it will never get to trial because we did no wrong and could demonstrate the soundness of our process.

            There are things you can do as part of the competitive process to ensure your actions can survive scrutiny by the vendor’s lawyers and the courts. Now, as we all know, litigation cannot be totally avoided. Anyone can sue you, for any reason. And sometimes, organizations get sued, not because they have erred, but because one particular vendor was truly angry, or the vendor wanted to ensure that next time the procurement people would be very careful in how they treated that vendor. There are lots of activities which improve the RFP process. For example, issuing a draft RFP, using outside experts, or employing best and final offers.

            Here are some document driven activities which, if done properly, make it extremely difficult for the vendor’s lawyer to be enthusiastic about their chances of wining in court. These activities, when completed as part of the RFP process, help ensure that the competition is fair and open. Just as importantly, the documents which are part of these activities, when reviewed by a lawyer after the award has been made, demonstrate the process is well planned and managed to ensure that each vendor is treated fairly.

1. Follow an RFP road map.

Developing and issuing an RFP and selecting the best value proposal is a common process based on fair and open competition. Use the RFP document to demonstrate that the entire process is properly planned. Many jurisdictions base their process on the Model Procurement Code developed by the American Bar Association in the 1980s and recently revised. The State of Montana Procurement Bureau has a good road map based on a 22 step RFP process. It is available at http://www.discoveringmontana.com/doa/GSD Click on How do I…, then click on Prepare an RFP Response?

2. Specify the activities of the Evaluation Committee.

Demonstrate in the RFP that the Evaluation Committee is properly organized and directed to ensure fairness. Members of the Evaluation Committee are usually selected because of their knowledge or expertise related to the procurement. In some organizations, members of the Evaluation Committee may have preexisting, informal relationships with contractors. It is important that each person on the Evaluation Committee understand their role and the critical nature of their activities and behavior during the process. In many jurisdictions, care is taken to ensure that there are no conflicts of interest and the proposals and deliberations are kept confidential. Committee members are provided written instructions and are often required to sign agreements on how they will behave. In Arizona, there is a State law requiring a declaration from each committee member. The Alaska Division of General Services has developed a guide to help evaluators understand their role and responsibilities. This document is available at http://www.state.ak.us/local/akpages/ADMIN/dgs/policy.htm

3. Develop a fairness plan.

Use the RFP to demonstrate that you have taken steps to ensure that your process is equitable, justifiable, sound, and provides equal opportunity for all proposers. The Victoria Government Purchasing Board (Australia) has produced excellent documentation related to the entire procurement process. Probity, defined as “unimpeachable honesty and virtue” or “complete and confirmed integrity,” is a critical issue. They have developed and published a policy which is accompanied by a Probity Plan Template. This document lists 40 tasks which, when executed, help ensure compliance with public policy. (Go to http://www.vgpb.vic.gov.au, then click on Templates & Tools) Once the process is finished, this document can be used to prove that the entire process complied with public policy and the law.

4. Publish and evaluation guide.

Use the RFP to demonstrate that the Evaluation Committee is briefed on their responsibilities and that the step-by-step evaluation procedure is established before the proposals are opened. The evaluation process often becomes the center of controversy and intense scrutiny. It is a common practice to define the details of the evaluation process while the RFP is being developed. In most organizations, the Project Manager or Procurement Officer reviews the evaluation procedure with the Evaluation Committee just before the proposals are distributed. They want to ensure that each evaluator understands the process and performs accordingly.

Some organizations provide the evaluators with score sheets; others with a description of their responsibilities. Some organizations provide each evaluator with a guide, which is a detailed description of the evaluation process based on the RFP itself. While these guides take time and effort to prepare, they are worth it. These guides help the evaluators understand the process and their responsibilities. They simplify the work of the evaluators and they are a great tool in defending the process from criticism.

5. Publicize and effective debriefing procedure.

Use the RFP to demonstrate your sense of fairness and your organization’s willingness to deal with supplier’s concerns without litigation. The existence of a well written, reasonable debriefing procedure will reinforce the idea that the entire RFP process is done properly. It will also convince some disgruntled vendors to seek more information before talking to their lawyers. Finally, an inviting and open debriefing process permits you to find out which vendors are really, really angry and gives you an opportunity to defuse the situation.

6. Document the protest procedure.

Use the RFP to inform vendors that you will attempt to resolve their issues through discussions and negotiations, rather than litigation. A written protest procedure can direct, and control the vendor’s activities, promote confidence in the process, promote the resolution of grievances, and restrict or discourage frivolous protests. There are many examples of protest policies and procedures. Some are statutes, others are policies or guidelines. They all deal with the same set of issues: Who can protest? When? What is the procedure? Who decides if a claim has merit? What are the remedies? What happens to the pending contract during the protest process?

Michael Asner is a consultant about the Request for Proposal process. He has written The Request for Proposal Handbook and publishes The RFP Report, a monthly newsletter. Michael can be reached at (604) 530-7881 michael@rfpmentor.com

For more information about RFPs, visit his website: www.rfpmentor.com

Site Map | Disclaimer | Customer Service Privacy Policy | Refund Policy | Deliver / Shipping