B-155032, OCT. 13, 1964

B-155032, OCT. 13, 1964

TO C AND M MACHINE PRODUCTS, INC.:

REFERENCE IS MADE TO YOUR LETTER DATED AUGUST 19, 1964, REQUESTING RESCISSION OF CONTRACT NO. DSA-18-S-1690 AND REFUND OF PURCHASE PRICE. YOU ALLEGE AN ERROR IN BID IN THAT YOU INTENDED YOUR BID OF $757.00TO BE APPLICABLE TO ITEM 43 AND NOT ITEM 42, OF THE INVITATION FOR BIDS.

BY INVITATION NO. 18-S-64-89, DATED MAY 6, 1964, THE DEFENSE SURPLUS SALES OFFICE OFFERED FOR PURCHASE FROM THE GOVERNMENT CERTAIN MACHINE TOOLS AND OTHER SURPLUS PROPERTY OF VARYING DESCRIPTIONS. YOU SUBMITTED A BID IN THE SUM OF $757.00 FOR ITEM 42 AND NOW REQUEST RESCISSION OF THE AWARD MADE TO YOU OF THAT ITEM ON THE BASIS OF A MISTAKE IN BID, IT BEING ALLEGED THAT YOU INTENDED TO BID THE ABOVE AMOUNT ON ITEM 43.

THE RECORD SHOWS THAT YOU BID $757.00 UPON ITEM 42, A GRINDING MACHINE, USED, NEEDING REPAIRS, WITH AN ACQUISITION COST OF $1,127.00; THAT ON JUNE 3, 1964 AWARD WAS MADE OF ITEM 42 TO YOU, AND A COPY OF THE AWARD MAILED ON THAT DATE; THAT THE PROPERTY WAS REMOVED ON JUNE 16, 1964 BY YOUR REPRESENTATIVES; THAT AFTER PAYMENT OF THE BID PRICE BY DEDUCTION FROM THE BID DEPOSIT AND REMOVAL OF THE PROPERTY, YOU CONTACTED THE PROPERTY DISPOSAL OFFICER AND THE SALES CONTRACTING OFFICER ON JUNE 17, 1964, ALLEGING A MISTAKE IN BID; THAT YOU ALLEGED THAT YOU INTENDED TO BID UPON ITEM 43, A MILLING MACHINE, USED, NEEDING REPAIRS, WITH AN ACQUISITION COST OF $7,577.00 AND IN ERROR THE BID WAS TYPED IN THE BLOCK FOR ITEM 42.

THE RECORD ALSO CONTAINS THE AFFIDAVIT OF THE SECRETARY TO THE PRESIDENT OF YOUR COMPANY STATING THAT SHE ERRONEOUSLY TYPED THE BID PRICE IN THE BLOCK FOR ITEM 42 INSTEAD OF ITEM 43. IN ADDITION YOU HAVE FURNISHED PHOTOCOPIES OF YOUR WORKSHEETS INDICATING AN INTENTION TO BID $757.00 UPON ITEM 43 (WITH NOTHING MARKED FOR ITEM 42) AND YOUR PURCHASE ORDER SHOWING ITEM 43 AS $757.00.

IN YOUR LETTER OF AUGUST 19, 1964, IT IS STATED THAT YOU BELIEVE THE CONTRACTING OFFICER SHOULD HAVE VERIFIED YOUR BID PRIOR TO AWARD SINCE THE ONLY OTHER BID ON ITEM 42 WAS $10.05 FROM A SCRAP DEALER. YOU EXPRESS THE OPINION THAT THE CONTRACTING OFFICER SHOULD HAVE BEEN AWARE THAT AN ERROR HAD BEEN COMMITTED.

THE BASIC QUESTION FOR CONSIDERATION IS NOT WHETHER YOU MADE A MISTAKE IN YOUR BID BUT WHETHER THE ACCEPTANCE OF THE BID BY THE CONTRACTING OFFICER CONSUMMATED A VALID AND BINDING CONTRACT, AND WHETHER IN THE CIRCUMSTANCES OF THIS CASE THE CONTRACTING OFFICER HAD CONSTRUCTIVE NOTICE OF ERROR IN THE BID PRIOR TO AWARD. IN THIS REGARD THE DIFFERENCE IN THE BID PRICES FOR ITEM 42 WOULD NOT, IN AND OF ITSELF, BE CONSTRUCTIVE NOTICE OF ERROR. PRICES OFFERED TO THE GOVERNMENT FOR ITS SURPLUS PROPERTY ARE BASED MORE OR LESS UPON THE USE TO WHICH THE PROPERTY IS TO BE PUT BY THE PARTICULAR BIDDER OR UPON THE RISK OF RESALE WHICH THE BIDDER MIGHT WISH TO TAKE. SEE 16 COMP. GEN. 596; 17 ID. 388; ID. 601; ID. 976; 28 ID. 261; AND ID. 550. SEE ALSO UNITED STATES V. SABIN METAL CORP., 151 F.SUPP. 683, 689.

WE FIND NOTHING IN THE RECORD BEFORE US WHICH WOULD PROVIDE A BASIS FOR CHARGING THE GOVERNMENT CONTRACTING OFFICER WITH NOTICE OF THE PROBABILITY OF AN ERROR IN YOUR BID ON ITEM 42. WHILE THERE IS A SUBSTANTIAL PRICE DISPARITY BETWEEN YOUR COMPANY'S HIGH BID FOR THE ITEM AND THE OTHER OFFER RECEIVED, SUCH A DIFFERENCE, WITHOUT MORE, DOES NOT PROVIDE A BASIS FOR ESTABLISHING PROBABLE ERROR IN VIEW OF THE WIDE VARIANCE IN BIDS GENERALLY RECEIVED IN THE SALES OF GOVERNMENT SURPLUS. THIS BEING TRUE, IT NECESSARILY FOLLOWS THAT WE LIKEWISE MAY NOT REASONABLY CONCLUDE THAT THE CONTRACTING OFFICER OWED ANY DUTY, IN THIS CASE, TO EXAMINE THE OVERALL PATTERN OF THE PRICES QUOTED BY YOUR COMPANY ON OTHER ITEMS WITH A VIEW TOWARD DETERMINING, BY SUCH COMPARATIVE PRICES, WHETHER THERE WAS THE PROBABILITY OF AN ERROR IN THE BID ON ITEM 42.

UPON THE BASIS OF THE RECORD BEFORE US, IT APPEARS THAT THE ACCEPTANCE OF THE BID IN THIS CASE WAS IN GOOD FAITH, NO ERROR HAVING BEEN ALLEGED UNTIL AFTER AWARD. ACCORDINGLY, WE CONCLUDE THAT THE ACCEPTANCE OF THE BID CONSUMMATED A VALID AND BINDING CONTRACT WHICH FIXED THE RIGHTS AND OBLIGATIONS OF THE PARTIES. SEE UNITED STATES V. PURCELL ENVELOPE COMPANY, 249 U.S. 313, AND AMERICAN SMELTING AND REFINING COMPANY V. UNITED STATES, 259 U.S. 75.

THE RESPONSIBILITY FOR THE PREPARATION OF A BID SUBMITTED IN RESPONSE TO AN INVITATION TO BID IS UPON THE BIDDER. SEE FRAZIER-DAVIS CONSTRUCTION COMPANY V. UNITED STATES, 100 CT.CL. 120, 163. IF AN ERROR WAS MADE IN THE PREPARATION OF THE BID, AS ALLEGED, IT MAY PROPERLY BE ATTRIBUTED SOLELY TO THE CONTRACTOR'S NEGLIGENCE, AND SINCE THE ERROR ON WHICH THE CONTRACTOR'S REQUEST IS BASED WAS UNILATERAL, NOT MUTUAL, THE CONTRACTOR IS NOT ENTITLED TO RELIEF. SEE OGDEN AND DOUGHERTY V. UNITED STATES, 102 CT.CL. 249, 259, AND SALIGMAN, ET AL. V. UNITED STATES, 56 F.SUPP. 505, 507.

ACCORDINGLY, WE FIND NO LEGAL BASIS FOR RESCINDING THE CONTRACT IN THIS CASE BECAUSE OF THE ALLEGED MISTAKE IN BID.