Who has experience with allowing bids to be received via e-mail? Would you please share your thoughts, your take and your pros and cons on the concept and the legal implications.
Also, the write-up you use to address this.
Thanks much
I’ve not done this or experienced it with any of my clients, but the thought sends chills down my spine. I do not believe E-mail delivery to be secure or reliable enough to be used for a formal bidding receipt.
For negotiated or informal proposals I can see that with a hard copy follow up. But not stand alone.
Margaret, would requiring a .pdf format provide adequate security?
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Ralph,
Not in my mind. The issue for me is the delivery not the format.
Just as first swag, what level of heartburn does this raise? Tried to account for all of Margaret’s insightful comments–
E-Mail Bids: Bids may be submitted via e-mail, provided they are complete and signed, in .pdf form,only; are part of an e-mail message with a recorded time prior to the bid receipt time, and are followed with a hard copy, with 24 hours.
Any difficulty in opening the files will be considered flaws in the preparation and sending procedures, and could cause bids to be deemed void and non-responsive.
All:
The only problem I see is that it is an “all or nothing” situation. It seems that there could be a conflict if some submitted with a hard copy and some were submitting electronically.
If, for instance, you were only recieving some of the bids via e-mail, and the reciever had technical difficulty, would the deadline be extended for those submitting electronically?
Estimating with Electronic Documents
Email bids… hmmm…
Isn’t that what ebay does?
Can’t you see a scenario where bidders have a deadline, and compete against each other online to lower their prices until the deadline is reached? “2 minutes until that hospital goes final…wonder if I can shave a few dollars off of my general conditions???”
…but I digress.
Margaret,
There are such things as digital signatures that are available (this is not a ‘signature’ from a person, but one that assures the originality of an electronic document). However, if there was an owner that was equipped to deal with them not everyone has that level of sophistication.
We have owners that permit FAX and require that to be followed by a formal signed paper document. No one currenlty permits email for anything related to the bidding that I am aware of. Some of them do not even permit questions by email, though most do.
Do I think it is viable, yes, I see no reason not to do this. Technically what they ought to do is send an email with a pdf file of the bid documents signed and completed (created by scanning the document), if it is to be the final bid form. However, if the owner wanted it as something preliminary, it could be just outlined in the email and then followed up with the real paper document delivered.
Because we are talking about real significant $ here, I am sure the lawyers on the Owner’s side are the ones that are going to be in the drivers seat about how it is done. I would be surprised if they ‘don’t care’. What would NOT surprise me would be an Owner’s project management team wanting to do this and not caring how the architect ‘takes care of it’ and not having checked with their own legal group first.
William
Geroge, unfortunately that has already happened. I have been involved with projects where the owner used Bid Auctions.
A significant issue with submitting bids electronically (aside from any legal issues with wet ink signatures) has to do with timeliness. We are used to thinking about e-mail being instantaneous, and in many cases it for all practical purposes. However, most people who have been doing e-mail for any length of time will have an experience where trasmission and receipt is delayed. Usually this is no longer than a few hours, but often both sender and receiver are unaware of the problem until someone calls up and asks, “Did you get my e-mail?” The problem may lie in one or more computers on the sender side, the transmission process, or the receiver. Although you can require the party submitting the bid to be responsible for it getting into the right hands, there would likely be some serious problems is the receiving system had issues. We have had some cases recently where e-mails to our office were screened out by our spam and virus filters, and we have had some cases where our e-mail was blocked.
More than 10 years ago, a major contracting firm in Honolulu told me it was their policy to send people in 2 different vehicles, each with sets of bid forms, to the bid site. The person relating the story did not know its origin, but it doesn’t take much imagination to conjure up several scenarios which may have caused this policy to be instituted.
Contractors hate to get beat out on a bid; they would be absolutely livid if their low bid on a $10 million job was not received because their domain name had inadvertently been identified as an originator of spam and the bid was not received.
E-mail is great; we do permit a lot of communcation by e-mail, but when an Owner insists on having an option to submit by e-mail (or fax), I make sure that all parties understand the potential problems. Most contractors I know would much rather submit a physical sealed bid than send a virtual one.
AACE members can download this article at no cost - all others pay $7.50.
AACE Ref.#: 18144 (AACE MEMBERS - CLICK HERE FOR FREE DOWNLOAD) [File size: 545 kB]
Electronic Bidding: The Future is Now, William C. Epstein, PE; Dr. Ralph D. Ellis, Jr., PE, 1995 AACE International Transactions, PM&B.07, AACE International, Morgantown, WV, 1995
The early uses of the computer in construction were typically limited to mostly accounting-type functions. However, with the advent and proliferation of the personal computer, this technology has now permeated throughout the entire industry. The capabilities of the computer with respect to fast and accurate calculations, along with easy storage and retrieval of large amounts of information, have made it an indispensable tool for estimating construction costs. Given the fact that computerized estimating is now universally accepted within the construction industry, the concept of electronic bidding seems to be a natural progression in the evolution of computers in construction.
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PRICE: $7.50 / $5.00 (Nonmember / AACE Member) All articles ordered are scanned, converted to Adobe Acrobat (PDF) format, and delivered via e-mail
It is so easy for bad guys to disguise a fraudulent e-mail to look like an official e-mail from a bank, paypal, e-bay, etc. Phishing it is called. What is to say an unscrupulous contractor wouldn’t disguise an e-mail to look like a competitors, forge an address, and insert an unusually high bid? That is not to say that e-mail bidding can not work, but it does seem ripe for exploitation. Are most owner’s sophisticated enough to control the process? I love computers and what they do for me, but I’ll take a paper bid any day of the week.
The way to do electronic bidding is not with e-mail, but with a secure web server, much like today’s e-commerce. The owner would set up a secure site where bidders would go to enter their bids in a web form (or series of them), and submit it. Bidders would have previously set up an “account” so they could login and control their bids. Notification could be by e-mail, and on the bidder’s “account” page. At the time bids were due, the accounts would be “locked” so no further changes were made. Obviously, there would still need to be some paper involved–as far as I know bonds, for example, cannot be done electronically (yet). Even a bid security could be done electronically. I’ve been doing on-line banking and investing for about 15 years and never once had a problem. (Yeah, I was an early adopter.)
And what would prevent an unscrupulous contractor from submitting a paper bid disguised as one from a competitor? So many of the arguments used to prevent use of electronic documents can be easily applied to paper documents. Give me existing drawings and a project manual and I can create paper fakes that are virtually indistinguishable from the originals.
Wet signatures are another joke; fortunately, I have worked on only one project that required them on everything. How do you know if the wet signature was signed by the right person? Should we require a notary seal for signatures? Maybe we should do what Radar did in MASH, and have people initial next to their signatures to prove they are real.
The scenerios offered above by George, Peter and Don are the issues that concern me and send those chills up my spine. (Also a specific contractor with which I’ve had to deal with that thinks he’s a lawyer, who would love this loop hole).
Any thing can be counterfeited if someone is really determined, but e-mail bids add another level of technical glitches that make project managers scream!
The secure web-site suggested by John is possibly an acceptable alternative, because there are security protocols that can be incorporated that are not typically there in normal e-mail, which is what Ralph started this discussion about.
I see this as something that WILL happen in the future and this forum allows the professionals that deal with the issues to respond and plan, not just react. Requiring pre-registration of bidders intending to submit via email, and having this registration via email would allow a “test” run. The issue of server delay would need to be addressed as well a the spam issue. The submission by email is at the bidders risk and option. Submission of a pdf containing all of the required documents (as a single pdf) is the way to go. A hard copy follow up within 24 hours would allow for the necessary leaglities during bid confirmation process. This would also “check” any of the counterfeiting that has been discussed.
It wouldnt be foolproof, but then we have all dealt with the traditional hard copy process that has its’ own glitches and is not perfect.
I believe the constructive discussion here will help us to formulate a solution to allow this process.
While I agree electronic bidding will become a reality, the fact of the matter is that Margaret’s essential concerns about e-mail are correct. It is still too unreliable and there is no such thing as “secure” e-mail messaging. While there have been discussions about adding appropriate security measures, the current internet e-mail protocol is not really capable of these changes, short of an entirely new protocol that would be incompatible with the existing. (I only overstate this a little bit. It is, of course, pretty complicated.) This is why you don’t see a single e-commerce site that functions via e-mail, other than as a customer-service function.
Snail-mail is also not reliable, nor is it secure. If you’re a conspiracy theorist, you know that even a delivery service can be penetrated. Those guys in black helicopters could forge a whole bunch of fake bids and have their agent that works for UPS deliver them. Granted, it may be quicker to fake an e-mail (though I wonder if anyone in this discussion knows how to do it) than to fake paper documents, but to what purpose? If someone is that devious, it isn’t going to matter if the bid is submitted on paper, by e-mail, or etched in stone.
Electronic submittal using digital signatures is probably more secure than a paper bid; at least you can be certain where it originated. Oh, sure, someone could break into the contractor’s office and use that computer, or steal the password, but again, to what purpose?
If the bidder had a bad connection, or the ISP went out of business, or squirrels were on the phone line, no, you would not extend the bid date. If the post office forgot to pick up a bidder’s mail, or if the UPS truck had a flat, or if the bidder’s runner got in an accident, would you extend the bid date? If so, I guess you would make allowance for bad e-mail. If not, there is no reason you would make special provisions for e-mail bids. It is the bidder’s responsibility to get the bid in on time. Period.
It’s too bad we have so $#@* attorneys thinking of all the things that can go wrong with new innovations. It’s good we didn’t have as many in the past, or we’d still be using vellum and ink, because those computers might put a line in the wrong place, or part of the drawing might not show up when printed, or - wait a minute - that happens anyway, doesn’t it? And yet we deal with it, because the benefits are so great.
Maybe we should go back to stone and chisels. Now that’s technology that makes it really hard to forge documents!