Legal Updates

A false affidavit submitted by a bidder in a tender cannot be remedied and the bid need be disqualified

March 20, 2022
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The Ramat Gan municipality accepted a winning bid in a tender despite the fact it was proven that the bid included a false affidavit, after accepting the bidder's position that it was a mistake in good faith.

The Court held that a defect of submitting a false affidavit in the tender could not be remedied and the bidder's bid is to be disqualify. Technical defects that are visible on the surface and that do not violate the principle of equality will not usually lead to the disqualification of a proposal. Defects of a material nature, which result from errors in good faith or do not cause a breach of the principle of equality, will also not lead to the automatic disqualification of the proposal and each case should be reviewed on its own merits. Here, for the purpose of evaluating bids scoring, the bidders were required to attach an affidavit signed and verified by a lawyer that the bidder is not conducting legal proceedings against local authorities. Meeting this condition earned the bidder 2 points for its bid. The winning bidder submitted a false affidavit. This is not a technical defect that is clearly visible to the eye, but a material defect that violates the principle of equality between the bidders. It is not possible to obtain a remedy for the defect by reducing the score as the Tenders Committee did, becuase the rules must be respected at the starting point and not at the end point. Ignoring a false affidavit can lead to a slippery slope, as it allows a bidder caught in the act to claim that it acted in good faith while severely violating the principle of equality and the certainty required in tender procedures. Therefore, the winning bid is disqualified and the discussion was returned to the Tenders Committee for the purpose of determining the new winner of the tender.