B-149846, OCT. 30, 1962

B-149846, OCT. 30, 1962

TO THE SECRETARY OF THE NAVY:

REFERENCE IS MADE TO LETTER DATED OCTOBER 16, 1962, FROM THE ASSISTANT SECRETARY OF THE NAVY (INSTALLATIONS AND LOGISTICS), FURNISHING THE REPORT REQUESTED BY OUR OFFICE RELATIVE TO AN ERROR WHICH ACME IRON WORKS, INC., WASHINGTON, D.C., ALLEGES IT MADE IN ITS BID ON WHICH NEGOTIATED CONTRACT P.W. 207 IS BASED.

IT APPEARS FROM THE RECORD THAT ON JULY 17, 1962, WRITTEN QUOTATIONS WERE SOLICITED FROM THREE FIRMS BY THE OFFICER IN CHARGE OF CONSTRUCTION, U.S. NAVAL AIR FACILITY, ANDREWS AIR FORCE BASE, FOR FURNISHING ALL LABOR, MATERIAL, EQUIPMENT AND TOOLS NECESSARY FOR THE INSTALLATION OF WIRE PARTITIONS AND STEEL SHELVES IN FOUR STORAGE ROOMS OF THE BACHELOR OFFICER'S QUARTERS; THAT ACME IRON WORKS, INC., SUBMITTED A WRITTEN QUOTATION DATED JULY 24, 1962, IN WHICH IT OFFERED TO PERFORM THE WORK FOR THE LUMP SUM OF $566; AND THAT THE BID OF ACME IRON WORKS, INC., WAS ACCEPTED ON JULY 27, 1962.

BY LETTER DATED AUGUST 6, 1962, ACME IRON WORKS, INC., ADVISED THE OFFICER IN CHARGE OF CONSTRUCTION THAT IT HAD FOUND AN ERROR ON ITS WORKSHEET IN THAT IT HAD FAILED TO MULTIPLY THE UNIT COST PER ROOM BY FOUR --- THE NUMBER OF ROOMS IN WHICH THE WIRE PARTITIONS AND STEEL SHELVES WERE TO BE INSTALLED--- BEFORE ENTERING THE COST OF THE WORK ON ITS QUOTATION TO THE FACILITY. THE CORPORATION REQUESTED THAT IT BE GRANTED SOME RELIEF IN THE MATTER. IN SUPPORT OF ITS ALLEGATION OF ERROR, THE CORPORATION SUBMITTED ITS ORIGINAL WORKSHEET AND A COPY OF A QUOTATION DATED SEPTEMBER 7, 1962, RECEIVED FROM A SHELVING MANUFACTURER, WHEREIN THE CORPORATION WAS QUOTED A PRICE OF $539.50 FOR FURNISHING ONLY THE STEEL SHELVING KNOCKED DOWN AND A PRICE OF $570.78 FOR DELIVERING AND ERECTING (NON-UNION LABOR) THE STEEL SHELVING.

THE RECORD INDICATES THAT THE ONLY OTHER BIDDER ON THE WORK QUOTED A PRICE OF $1,030.95 AND THAT THE GOVERNMENT ESTIMATE WAS $840. IN ITS LETTER OF OCTOBER 16, 1962, THE DEPARTMENT SUGGESTS THAT IN VIEW OF THE DIFFERENCE BETWEEN THE BID PRICE OF ACME AND THE PRICE QUOTED BY THE ONLY OTHER BIDDER AND THE GOVERNMENT ESTIMATE, THE CONTRACTING OFFICER SHOULD HAVE BEEN ON CONSTRUCTIVE NOTICE OF AN ERROR IN THE BID OF THE CORPORATION. WE ALSO ARE OF THE OPINION THAT THE CONTRACTING OFFICER SHOULD HAVE BEEN AWARE OF THE PROBABILITY OF ERROR IN THE CORPORATION'S BID OF $566 AND, CONSEQUENTLY, THE BID SHOULD NOT HAVE BEEN ACCEPTED WITHOUT REQUESTING THE CORPORATION TO VERIFY ITS BID.

ON THE RECORD, THERE IS LITTLE ROOM FOR DOUBT THAT THE CORPORATION MADE AN ERROR IN ITS BID. IT IS REPORTED THAT NO WORK HAS BEEN DONE UNDER THE CONTRACT. ACCORDINGLY, SINCE IT WOULD BE INEQUITABLE TO REQUIRE THE CORPORATION TO FURNISH THE PARTITIONS AND SHELVES AT ITS ORIGINAL PRICE, THE CONTRACT MAY BE CANCELED WITHOUT LIABILITY TO THE CORPORATION.