B-148746, JUN. 22, 1962

B-148746, JUN. 22, 1962

TO BILL SLOMAN MACHINERY, INC.:

RECEIPT IS ACKNOWLEDGED OF YOUR LETTER DATED JUNE 7, 1962, IN REFERENCE TO OUR DECISION DATED MAY 15, 1962, TO THE DIRECTOR DEFENSE SUPPLY AGENCY, WHEREIN WE FOUND NO LEGAL BASIS FOR GRANTING THE RELIEF SOUGHT BY YOU UNDER SALE TRANSACTION NO.O.I. 4574.

THE CONTRACT WAS EFFECTED WHEN THE COLUMBUS CONSOLIDATED SURPLUS SALES OFFICE, COLUMBUS, OHIO, ACCEPTED YOUR BID FOR THE PURCHASE OF ITEM 29, COVERING ONE DRILL,"2BMA" AVEY, SGL.SPDL., ETC., FOR $1,102. AFTER RECEIPT OF THE AWARD YOU ADVISED THE GOVERNMENT CONTRACTING OFFICER THAT AN ERROR HAD BEEN MADE IN YOUR BID IN THAT YOU HAD INTENDED TO BID ON THE DRILL COVERED BY ITEM 30 AND NOT THE DRILL COVERED BY ITEM 29. YOU THEREFORE REQUESTED TO BE RELIEVED OF THE AWARD OF ITEM 29.

IN YOUR LETTER OF JUNE 7, 1962, YOU STATE THAT YOU WERE SURPRISED AT RECEIVING A LETTER FROM THE CONTRACTING OFFICER ADVISING YOU THAT HE HAD NO AUTHORITY TO CANCEL THE CONTRACT FOR THE PURCHASE OF ITEM 29 WHICH YOU STATE WAS PLAINLY SHOWN TO HIM AS AN ERROR AND THAT YOU ARE AT A LOSS TO UNDERSTAND WHY THE ADMINISTRATIVE OFFICE SEEMS TO FIND NOTHING IN THE RECORDS BEFORE IT PROVIDING A BASIS WHICH MIGHT BE CONSTRUED AS AN ERROR ON THE PART OF YOUR CORPORATION. YOU STATE FURTHER THAT THE DIFFERENCE BETWEEN YOUR BID OF $1,102 AND THE NEXT HIGHEST BID OF $387.88 IS SUFFICIENT TO ESTABLISH THAT AN ERROR WAS MADE BY YOUR CORPORATION AND THAT THE MATTER COULD BE RECTIFIED BY PERMITTING YOUR CORPORATION TO REDUCE ITS BID PRICE ON ITEM 29 FROM $1,102 TO $400, WHICH IS IN EXCESS OF THE NEXT HIGHEST BID RECEIVED ON THAT ITEM.

THE SOLE QUESTION FOR CONSIDERATION IN THIS TYPE OF CASE IS NOT WHETHER AN ERROR WAS, IN FACT, MADE IN YOUR BID ON ITEM 29, BUT WHETHER THERE EXISTED ANY CIRCUMSTANCES THAT ESTABLISHED NOTICE, EITHER ACTUAL OR CONSTRUCTIVE, TO THE GOVERNMENT CONTRACTING OFFICER AS TO THE PROBABILITY OF AN ERROR PRIOR TO AWARD. OBVIOUSLY THERE WAS NO ACTUAL NOTICE TO THE CONTRACTING OFFICER OF THE ERROR IN YOUR BID. REGARDING THE EXISTENCE OF CONSTRUCTIVE NOTICE, IT WAS STATED IN OUR DECISION OF MAY 15, 1962, TO THE DIRECTOR OF THE DEFENSE SUPPLY AGENCY, THAT WHILE THERE IS A SUBSTANTIAL PRICE DISPARITY BETWEEN THE BID OF YOUR CORPORATION AND THE 15 OTHER BIDS RECEIVED ON ITEM 29, SUCH DIFFERENCE, WITHOUT MORE, DOES NOT PROVIDE A BASIS FOR ESTABLISHING CONSTRUCTIVE NOTICE OF PROBABLY ERROR IN VIEW OF THE WIDE VARIANCE IN BIDS GENERALLY RECEIVED IN SALES OF GOVERNMENT SURPLUS PROPERTY. IN VIEW OF THESE DETERMINATIONS, AND SINCE THERE WERE FOUND NO OTHER CIRCUMSTANCES ATTENDING THE SUBMISSION OF YOUR BID THAT SHOULD HAVE ALERTED THE CONTRACTING OFFICER TO THE PROBABILITY OF AN ERROR THEREIN, WE MUST AFFIRM OUR PREVIOUS CONCLUSION THAT THE CONTRACTING OFFICER'S ACCEPTANCE OF YOUR BID CONSUMMATED A VALID AND BINDING CONTRACT WHICH FIXED THE RIGHTS AND LIABILITIES OF THE PARTIES.

IT IS A WELL-ESTABLISHED RULE THAT WITHOUT A COMPENSATING BENEFIT TO THE UNITED STATES, AGENTS AND OFFICERS OF THE GOVERNMENT HAVE NO AUTHORITY TO DISPOSE OF THE MONEY OR PROPERTY OF THE UNITED STATES, TO MODIFY EXISTING CONTRACTS, OR TO SURRENDER OR WAIVE CONTRACT RIGHTS THAT HAVE VESTED IN THE GOVERNMENT. SIMPSON V. UNITED STATES, 172 U.S. 372; UNITED STATES V. AMERICAN SALES CORP., 27 F.2D 389, AFFIRMED 32 F.2D 141, CERTIORARI DENIED 260 U.S. 574; PACIFIC HARDWARE CO. V. UNITED STATES, 49 CT.CL. 327; BAUSCH AND LOMB OPTICAL CO. V. UNITED STATES, 78 CT.CL. 584, CERTIORARI DENIED 292 U.S. 645.

ACCORDINGLY, WE FIND NO LEGAL BASIS FOR GRANTING YOU ANY RELIEF IN THE MATTER.