B-150086, JUN. 26, 1963

B-150086, JUN. 26, 1963

TO MR. I. W. HAVARD:

REFERENCE IS MADE TO LETTERS DATED DECEMBER 4, 1962, AND FEBRUARY 1, 1963, WITH ENCLOSURES, FROM SHAPIRO AND MAYER, REQUESTING, IN YOUR BEHALF, FURTHER CONSIDERATION OF THAT PART OF OUR DECISION DATED OCTOBER 26, 1962, TO THE ADMINISTRATOR, GENERAL SERVICES ADMINISTRATION, WHEREIN THERE WAS FOUND NO LEGAL BASIS FOR AUTHORIZING REFORMATION OF CONTRACT NO. GS-07B- 0018-/DC), TO INCLUDE PAYMENT OF CERTAIN ADDITIONAL AMOUNTS CLAIMED BY YOU UNDER THE CONTRACT IN VIEW OF ERRORS ALLEGED TO HAVE BEEN MADE IN YOUR BID UPON WHICH THE CONTRACT WAS AWARDED.

IN OUR DECISION OF OCTOBER 26, 1962, WE HELD THAT SINCE THERE WAS NO CLEAR AND CONVINCING EVIDENCE OF RECORD TO ESTABLISH THAT AN ERROR HAD BEEN MADE IN OMITTING SOME OF THE COST FOR THE ELECTRICAL WORK IN YOUR BID, THE ACTION TAKEN BY THE GENERAL SERVICES ADMINISTRATION IN AWARDING CONTRACT NO. GS-07B-0018-/DC) TO YOU WAS PROPER. THERE WAS CITED AS AUTHORITY FOR THIS CONCLUSION 29 COMP. GEN. 341, 342, AND 19 ID. 761, AND THE CASES CITED THEREIN. IT ALSO WAS HELD IN THE DECISION THAT THERE WAS NO LEGAL BASIS FOR AUTHORIZING REFORMATION OF THE CONTRACT TO INCLUDE THE ADDITIONAL AMOUNT OF $12,420 CLAIMED BY YOU FOR CERTAIN ARITHMETICAL ERRORS ALLEGED TO HAVE BEEN MADE IN YOUR BID, AS WELL AS FOR OTHER AMOUNTS COVERING CERTAIN COST FIGURES THAT WERE OMITTED, SINCE THE RECORD WAS DEVOID OF ANY CIRCUMSTANCES THAT WOULD HAVE CONSTITUTED CONSTRUCTIVE NOTICE TO THE GOVERNMENT CONTRACTING OFFICER OF THE PROBABILITY OF SUCH ERRORS IN YOUR BID PRIOR TO AWARD OF THE CONTRACT TO YOU.

A REVIEW OF YOUR ATTORNEYS' LETTERS OF DECEMBER 4, 1962, AND FEBRUARY 1, 1963, AND THE ENCLOSURES, SHOWS THAT THEIR REQUEST FOR RECONSIDERATION OF OUR DECISION IS DIRECTED SOLELY TO THAT PART OF OUR DECISION REGARDING THE ADDITIONAL AMOUNT OF $12,420 CLAIMED BY YOU BECAUSE OF THE ARITHMETICAL ERRORS IN YOUR BID AND FOR CERTAIN ITEMS FOR WHICH $11,760 HAS BEEN CLAIMED AS THE COST FIGURE THAT WAS INADVERTENTLY OMITTED FROM YOUR BID. IN THIS REGARD, YOUR ATTORNEYS CONTEND THAT THE GOVERNMENT CONTRACTING OFFICER WAS, OR SHOULD HAVE BEEN, ON NOTICE OF PROBABLE ERROR IN YOUR BID PRIOR TO AWARD SINCE COPIES OF YOUR WORKSHEETS, WHICH NOW HAVE BEEN FURNISHED TO US BY YOUR ATTORNEYS AND WHICH ALLEGEDLY SHOW THE ARITHMETICAL ERRORS AND OMISSIONS, WERE BROUGHT TO THE ATTENTION OF THE CONTRACTING OFFICER PRIOR TO THE TIME THAT CONTRACT NO. GS-07B-0018-/DC) WAS AWARDED TO YOU. IN THE FINAL ANALYSIS, YOUR ATTORNEYS HAVE REQUESTED FAVORABLE CONSIDERATION OF THIS PART OF YOUR CLAIM ON EQUITABLE GROUNDS.

WITH RESPECT TO YOUR CLAIM FOR $12,420 FOR THE ARITHMETICAL ERRORS THE RECORD BEFORE US INDICATES THAT SUCH ERRORS HAD, IN FACT, BEEN ALLEGED BY YOU AND THAT THE WORKSHEETS WERE FURNISHED TO THE CONTRACTING OFFICER PRIOR TO THE TIME THE AWARD WAS MADE TO YOU. MOREOVER, IT APPEARS THAT THE COMPLIANCE OFFICER OF THE GENERAL SERVICES ADMINISTRATION HAD DETECTED WHAT SEEMED TO HAVE BEEN SOME ARITHMETICAL ERRORS IN YOUR BID--- ALTHOUGH NOT IN THE AMOUNT OF $12,420 AS ALLEGED BY YOU. IN THIS REGARD, HOWEVER, THE GENERAL SERVICES ADMINISTRATION REPORTS THAT SINCE THERE NEVER WERE FURNISHED DETAILED BREAKDOWNS OF THE COST FIGURES MAKING YOUR TOTAL BID, THE CONTRACTING OFFICER HAD NO WAY TO DETERMINE THAT YOU DID NOT HAVE KNOWLEDGE OF THESE ARITHMETICAL ERRORS PRIOR TO SUBMITTING YOUR BID BUT HAD TAKEN SUCH ERRORS INTO ACCOUNT IN OTHER FIGURES ON WHICH YOU HAD NO WORKING PAPERS. THE ADMINISTRATION FURTHER REPORTS IT ALSO HAD RECOGNIZED THE POSSIBILITY THAT IF THERE HAD BEEN SUCH OTHER WORKING PAPERS AVAILABLE THEY MAY VERY WELL HAVE SHOWN OTHER ARITHMETICAL ERRORS WHICH WOULD HAVE OFFSET THE ERRORS NOW CLAIMED BY YOU. THE ADMINISTRATION POINTS OUT THAT THE WORKING PAPERS AVAILABLE WERE NOT ONLY INCOMPLETE BUT THERE WERE INCONSISTENCIES IN THEM IN THAT SOME PARTS WERE ITEMIZED AND SOME LUMPED INTO TOTAL AMOUNTS. IN VIEW OF THESE CIRCUMSTANCES, AND SINCE IT ALSO IS REPORTED THAT YOU HAD NOT FURNISHED THE CONTRACTING OFFICER WITH ANY CONVINCING PROOF THAT THE AMOUNT BID BY YOU FOR THE PROJECT WAS NOT THE AMOUNT YOU INTENDED, THE CONTRACTING OFFICER PROCEEDED WITH THE AWARD ACTION.

IN REGARD TO THE OMISSION IN YOUR BID OF CERTAIN COST FIGURES TOTALING $11,760, AS REFERRED TO BY YOUR ATTORNEYS, THE GENERAL SERVICES ADMINISTRATION STATES THAT WHILE NO AMOUNT WAS SPECIFICALLY SHOWN ON YOUR WORKING PAPERS FOR GRILLES, REGISTERS AND DIFFUSERS, THE PRICE THEREFOR COULD VERY WELL HAVE BEEN INCLUDED IN THE TOTAL PRICE SHOWN ON THE WORKSHEET. THE CONTRACTING OFFICER WAS NOT CONVINCED THAT AN ERROR OF OMISSION OF THIS KIND HAD BEEN MADE IN YOUR BID SINCE OTHER ITEMS LISTED ON THE WORKING PAPERS DID NOT INDICATE AN AMOUNT IN THE ITEMIZED ESTIMATE COLUMN ALTHOUGH THEY PRESUMABLY WERE INCLUDED IN THE TOTAL MECHANICAL PRICE.

A SUMMATION OF THE FOREGOING, THEREFORE, RESOLVES ITSELF INTO A SITUATION WHERE APPARENTLY THE CONDITION OF THE WORKSHEETS WAS SUCH THAT THE CONTRACTING OFFICER COULD NOT HAVE BEEN SURE THAT THE ARITHMETICAL ERRORS OR THE ERRORS OF OMISSION ALLEGED HAD, IN FACT, BEEN MADE IN YOUR BID OR, SECONDLY, IF SOME ERRORS ACTUALLY HAD BEEN MADE THAT THEY WERE NOT COMPENSATED FOR BY OTHER ERRORS WHICH MIGHT HAVE BEEN MADE ON OTHER ITEMS IN YOUR BID. THIS BEING THE CASE, WE DO NOT BELIEVE THAT THE RECORD BEFORE US IS OF SUCH CLARITY AS TO WARRANT A REVERSAL OF THE CONCLUSION REACHED BY THE GENERAL SERVICES ADMINISTRATION THAT THE CONTRACTING OFFICER WAS NOT ON NOTICE OF THE PROBABILITY OF THESE ERRORS IN YOUR BID PRIOR TO THE ACCEPTANCE THEREOF.

IRRESPECTIVE OF THE QUESTION AS TO WHETHER THE CONTRACTING OFFICER HAD ACTUAL OR CONSTRUCTIVE NOTICE THAT AN ERROR HAD BEEN MADE IN YOUR BID WE ARE OF THE VIEW THAT NO LEGAL BASIS EXISTS FOR REFORMATION OF THE CONTRACT. NOTWITHSTANDING THAT YOU WERE AWARE OF SUCH ALLEGED ERRORS PRIOR TO AWARD AND THAT YOU KNEW OF YOUR RIGHTS TO HAVE THIS PART OF YOUR CLAIM OF ERROR ADJUDICATED BY HIGHER AUTHORITY AT THAT TIME, AS YOU HAD DONE WITH RESPECT TO THE ALLEGED ERROR IN YOUR BID ON THE ELECTRICAL WORK, IT IS OBVIOUS THAT YOU NEVERTHELESS ELECTED TO SIGN THE CONTRACT, FURNISH PERFORMANCE AND PAYMENT BONDS AND PROCEED WITH THE WORK, APPARENTLY SATISFIED TO TAKE YOUR CHANCES ON THE APPROVAL OF THE CLAIM FOR SUCH ERRORS IN THE ADDITIONAL AMOUNTS OF $12,420 AND $11,760 AT A LATER DATE. PARTICULARLY PERTINENT TO YOUR ELECTION IN THIS REGARD IS THE FACT THAT THE RECORD BEFORE US FAILS TO SHOW THAT AT ANY TIME IN CONNECTION WITH THESE PARTICULAR CLAIMS WAS IT SUGGESTED, IMPLIED, OR INTIMATED BY GOVERNMENT OFFICIALS THAT YOU SHOULD FOLLOW ANY COURSE OF ACTION OTHER THAN THE ONE DETERMINED BY YOU TO BE THE BEST. THIS BEING SO, THE FACTS APPEAR CLEARLY TO BE CONTAINED WITHIN THE LEGAL PRINCIPLE APPLIED IN THE CASE OF THE MASSMAN CONSTRUCTION COMPANY V. UNITED STATES, 102 CT.CL. 699, CERTIORARI DENIED 325 U.S. 866, WHEREIN THE PLAINTIFF SOUGHT TO RECOVER $88,000, ALLEGING THAT IT OMITTED AN ITEM OF THAT AMOUNT IN PREPARING ITS BID. THE COURT, IN DENYING RECOVERY OF THE AMOUNT OF THE ALLEGED MISTAKE, STATED AT PAGE 717---

"AT THE TIME THE CONTRACT WAS AWARDED TO THE PLAINTIFF, PURSUANT TO ITS BID, AND AT THE TIME IT SIGNED THE CONTRACT, THE PLAINTIFF WAS NOT MISTAKEN. IT HAD BECOME AWARE OF THE MISTAKE IN ITS BID, AND FACED THE PROBLEM OF WHETHER IT WAS WILLING TO SIGN A CONTRACT FOR THE FIGURE WHICH IT HAD, BY MISTAKE SINCE DISCOVERED, BID. THE GOVERNMENT WAS ALSO AWARE OF THE PLAINTIFF'S CLAIM THAT IT HAD MADE A MISTAKE IN ITS BID. THERE WAS NOT, THEN, AT THE TIME OF SIGNING THE CONTRACT, ANY LACK OF KNOWLEDGE, EITHER MUTUAL OR UNILATERAL, WHICH CAUSED EITHER OF THEM TO MAKE THE CONTRACT WHICH THEY DID MAKE, WHEN IN FACT THEY INTENDED TO MAKE A DIFFERENT CONTRACT. THAT BEING SO, IF WE SHOULD REFORM THE CONTRACT AS THE PLAINTIFF REQUESTS, WE WOULD BE MAKING FOR THE PARTIES THE VERY CONTRACT WHICH ONE OF THEM, THE GOVERNMENT, EXPRESSLY REFUSED TO MAKE AT THAT TIME, THOUGH REQUESTED TO DO SO BY THE PLAINTIFF.'

ALSO, SEE BOARD OF TRUSTEES OF NATIONAL TRAINING SCHOOL FOR BOYS V. O. D. WILSON CO., INC., 133 F.2D. 399; 20 COMP. GEN. 652; 23 ID. 596; 25 ID. 536; AND 26 ID. 426. THE ENFORCEMENT OF THE CONTRACT AT THE PRICE SPECIFIED THEREIN--- WHICH PRICE IS NOT OUT OF LINE WITH THE OTHER BIDS--- DOES NOT APPEAR TO BE UNCONSCIONABLE.

ACCORDINGLY, OUR OFFICE HAS NO ALTERNATIVE, ON THE BASIS OF THE FACTS REPORTED IN THE CASE, BUT TO AFFIRM OUR DECISION DATED OCTOBER 26, 1962, TO THE ADMINISTRATOR, GENERAL SERVICES ADMINISTRATION.

WITH RESPECT TO THE REQUEST OF YOUR ATTORNEYS FOR EQUITABLE CONSIDERATION BY OUR OFFICE OF YOUR CLAIM, YOU ARE ADVISED THAT THE GENERAL ACCOUNTING OFFICE IS AUTHORIZED TO SETTLE CLAIMS ONLY IN STRICT ACCORDANCE WITH APPLICABLE LEGAL PRINCIPLES AND, THEREFORE, WE HAVE NO AUTHORITY OR JURISDICTION TO ALLOW CLAIMS BASED SOLELY ON A MORAL OBLIGATION OF THE GOVERNMENT.