amounts to "execution" of a law. As such, the Court must reject defendant's argument that the provisions at issue violate the fundamental doctrines of separation of powers. The stay provisions are constitutional.
AID'S REFUSAL TO STAY THE YOUNG CONTRACT VIOLATES THE ADMINISTRATIVE PROCEDURE ACT.
The Administrative Procedure Act authorizes a court to set aside as unlawful agency action that is "arbitrary, capricious, an abuse of discretion, or otherwise not in accordance with law." Ordinarily, a court must look at whether the decision was based on the legally relevant factors and whether the decision-maker made a clear error of judgment. Citizens to Preserve Overton Park v. Volpe, 401 U.S. 402, 416, 28 L. Ed. 2d 136, 91 S. Ct. 814 (1971). A more stringent test is usually applied in the government procurement area; there, only decisions that are not "reasonable" or "rational" are deemed to violate the law. Kentron Hawaii, Limited v. Warner, 156 U.S. App. D.C. 274, 480 F.2d 1166 (D.C. Cir. 1973); M. Steinthal & Co. v. Seamans, 147 U.S. App. D.C. 221, 455 F.2d 1289 (D.C. Cir. 1971). This case does not involve a procurement as such but, whether tested under the general or the procurement-specific standard, AID's action is obviously contrary to law.
As detailed above, the Competition in Contracting Act requires the head of procurement activity to issue a written statement stating reasons why a stay of a particular contract would damage United States interests if he or she has so determined. See slip op. p. 7, supra ; 31 U.S.C. § 3553(d)(2)(A). Mr. Terrence McMahon, head of procurement for AID, issued a statement that purports to satisfy this requirement. Plaintiff's Statement of Points and Authorities, Exhibit B (Letter from T.J. McMahon to General Counsel, General Accounting Office). No matter how often this Court has read McMahon's statement, it still cannot conclude that AID's decision was based on the factors that CICA makes "legally relevant" or was even rational or reasonable.
That letter speaks of the importance of and urgent need for famine relief. The Court has no doubt that famine relief is in the best interests of the United States and that circumstances are sufficiently "urgent and compelling" to merit an uninterrupted flow of relief to the hungry. But to say that it is in the best interests of the United States to ship food is not to give a reasoned analysis of why suspension of this particular contract would adversely affect the interests of the United States. And that alone is the statement required under the Competition in Contracting Act.
Thus, the Court cannot conclude that AID has examined the legally relevant factors, for it is apparent that AID has not investigated whether a stay of the Young Contract would harm the interests of the United States. It is equally apparent to the Court that such a conclusion would not be rational or reasonable, as plaintiff is, and others may be, in a position to offer the services contracted for by Young on an interim basis. Indeed, it is undisputed that AID has in the past extended plaintiff's contract precisely because plaintiff was able to provide services and Young was not. In short, service would seem able to proceed unabated and the Court cannot divine a rational or reasonable basis for the agency's conclusion that the interests of the United States would be protected only if the disputed contractor performed the contract. The conclusion is inescapable: AID's decision not to stay the Young Contract does not meet the standards of the Administrative Procedures Act and must be set aside as contrary to law.
PLAINTIFF IS ENTITLED TO INJUNCTIVE RELIEF.
The Court has concluded that defendant's action was contrary to law and must be set aside. This does not end the inquiry as to the shape of equitable relief. The standards governing grant of a permanent injunction are clear. The Court must look at the interests of the parties who might be affected by the decree and must also examine whether the facts and the relevant law indicate that an injunction clearly should be granted or denied apart from any countervailing interest. 11 C.A. Wright and A. Miller, Federal Practice and Procedure : Civil § 2942 at 365-67 (1973). And, if the Court determines that equitable relief is warranted, it has great discretion as to its appropriate scope. Lemon v. Kurtzman, 411 U.S. 192, 200-01, 36 L. Ed. 2d 151, 93 S. Ct. 1463 (1973).
Several things are evident. Plaintiff has been harmed by defendant's unlawful failure to stay the Young Contract. And, on the record before it, the Court must conclude that the best interests of the United States favor a stay of the Young Contract -- in other words, they favor injunctive relief in this case. But the decree must both treat plaintiff fairly and recognize that the best interests of the United States are at all times paramount and may not always align so precisely with those interests that are peculiarly plaintiff's own.
The Court finds three facts especially relevant to its task. First, plaintiff's contract with AID is renewable at AID's option. Second, that contract was renewed when Young was unable to begin performance. Finally, the terms of the Competition in Contracting Act allow a procurement director to determine that a contract's stay harms United States interests at any time while a protest of that contract is pending.
Taken together, these facts dictate the equitable decree to be imposed in this case. Unless and until defendant proffers written reasons why a stay of the Young Contract would be contrary to the best interests of the United States, or that circumstances are so urgent and compelling that they do not permit waiting for resolution of the protest, the Young contract must, as the law requires, be stayed. As long as that stay is in effect, plaintiff's contract will be extended and plaintiff will provide the services that it has been obligated to provide under contract, at the terms laid out in the contract, since July 1985. Defendant may at any time issue a reasoned, written analysis of why plaintiff's provision of those services would be contrary to the best interests of the United States. If defendant should make either finding, its written analysis must be submitted to this Court for approval under the terms of 31 U.S.C. § 3553(d)(2)(A) and the Administrative Procedure Act. Unless and until the Court finds that any such statement complies with the terms of the law, plaintiff will continue to be responsible for providing the services under contract.
Accordingly, the Court will issue an Order, of even date herewith, granting plaintiff's motion and specifying the terms of equitable relief mandated by this Opinion.
In accordance with the Opinion in the above-captioned case, issued of even date herewith, and for the reasons stated therein, it is this 3rd day of February, 1987,
ORDERED that the decision by the head of procurement activity for the Agency for International Development not to stay a contract awarded to Daniel F. Young, Inc., pending resolution of plaintiff's protest of that award is, and is hereby declared to be, contrary to law; and it is
FURTHER ORDERED that the aforesaid contract between defendant and Daniel F. Young, Inc., shall be, and hereby is, stayed until plaintiff's protest of that award is resolved by the Comptroller General of the United States; and it is
FURTHER ORDERED that the contract between plaintiff and defendant for provision of freight forwarding, booking, and chartering services, which expired on January 25, 1987, shall be, and hereby is, extended, at the terms set forth in that contract, until plaintiff's protest of the contract award to Daniel F. Young, Inc., is resolved by the Comptroller General of the United States; and it is
FURTHER ORDERED that, at any time before plaintiff's protest is resolved by the Comptroller General, defendant may issue a reasoned, written finding that explains why such a continuation of plaintiff's contract would be contrary to the best interests of the United States; and it is
FURTHER ORDERED that, at any time before plaintiff's protest is resolved by the Comptroller General of the United States, defendant may issue a reasoned, written finding that explains why a stay of the Young Contract would be contrary to the best interests of the United States or would occur during a time of such urgent and compelling circumstances significantly affecting the interests of the United States that defendant could not wait for resolution of plaintiff's protest; and it is
FURTHER ORDERED that any written finding by defendant shall be submitted to this Court for a determination as to its lawfulness and shall have the effect of ending the stay on the contract awarded to Daniel F. Young, Inc., or of terminating plaintiff's contract with defendant, only if the Court determines that defendants have acted consistently with 31 U.S.C. § 3553(d)(2)(A) and the Administrative Procedure Act, as interpreted by the Opinion accompanying this Order.