A-10269, JULY 13, 1925, 5 COMP. GEN. 26

A-10269: Jul 13, 1925

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THAT THE BIDS WERE OPENED ON APRIL 16. THE AWARD WAS NOT MADE TO SAID COMPANY UNTIL JUNE 5. THAT THE BID WAS BASED ON THE MARKET PRICE OF 35 CENTS PER POUND FOR PRIME RIBBED SMOKED SHEET RUBBER. IT HAS BEEN HELD THAT AN OFFER OR BID MADE IN RESPONSE TO AN INVITATION FOR BIDS IS A CONTINUING OFFER TO REMAIN OPEN AND IN FORCE UNTIL ACCEPTED BY THE GOVERNMENT OR WITHDRAWN BY THE MAKER. THAT THE BIDDER WAS AT LIBERTY TO CANCEL OR WITHDRAW AN OFFER OR PROPOSAL AT ANY TIME BEFORE ACCEPTANCE. ALSO THAT A CONTRACTOR IS RELIEVED FROM THE TERMS OF AN OFFER NOT ACTED UPON OR ACCEPTED FOR AN UNREASONABLE TIME AFTER THE ADVERTISED DATE FOR OPENING BIDS. OTHER DECISIONS ARE TO THE EFFECT THAT WHERE PROPOSALS ARE NOT WITHDRAWN PRIOR TO ACCEPTANCE.

A-10269, JULY 13, 1925, 5 COMP. GEN. 26

CONTRACTS, PROPOSALS AND ACCEPTANCES - ADVANCES IN COSTS OF MATERIALS PROPOSALS SUBMITTED IN RESPONSE TO INVITATIONS FOR BIDS FOR SUPPLIES, ETC., CONSTITUTE CONTINUING OFFERS, AND UNLESS CANCELED OR WITHDRAWN PRIOR TO ACCEPTANCE INCREASES IN COSTS OF RAW MATERIALS OCCURRING AFTER THE OPENING OF THE BIDS AND PRIOR TO AWARDS DO NOT, IN THE ABSENCE OF UNREASONABLE DELAYS ON THE PART OF THE PURCHASING DEPARTMENT, AUTHORIZE THE MAKING OF ALLOWANCES IN ADDITION TO THE PRICES FIXED IN THE ACCEPTED BID, NOR UNDER REVERSE CONDITIONS WOULD DECREASES IN PRICES OF RAW MATERIALS BE GROUNDS FOR CORRESPONDING REDUCTIONS IN THE PRICES SPECIFIED IN THE BID.

COMPTROLLER GENERAL MCCARL TO THE POSTMASTER GENERAL, JULY 13, 1925:

THERE HAS BEEN RECEIVED YOUR LETTER OF JUNE 23, 1925, REQUESTING MY DECISION AS TO WHETHER RELIEF MAY BE GRANTED THE TYER RUBBER CO. UNDER CIRCUMSTANCES AS STATED IN YOUR LETTER.

FROM THE FACTS AS STATED IT APPEARS THAT IN RESPONSE TO AN ADVERTISEMENT FOR PROPOSALS TO BE OPENED ON APRIL 16, 1925, FOR FURNISHING THE ANNUAL REQUIREMENT OF SUPPLIES FOR THE POST OFFICE DEPARTMENT FOR THE CURRENT FISCAL YEAR, THE TYER RUBBER CO. SUBMITTED A BID OFFERING TO FURNISH RUBBER BANDS--- ITEMS NO. 385 AND NO. 386 OF THE PROPOSAL--- AT A PRICE OF 60 CENTS PER POUND; THAT THE BIDS WERE OPENED ON APRIL 16, 1925, BUT THE AWARD WAS NOT MADE TO SAID COMPANY UNTIL JUNE 5, 1925; THAT THE BID WAS BASED ON THE MARKET PRICE OF 35 CENTS PER POUND FOR PRIME RIBBED SMOKED SHEET RUBBER, WHICH PRICE FOR THE SAME RUBBER HAD INCREASED TO 77 CENTS PER POUND ON JUNE 5, 1925; AND THAT ON ACCOUNT OF THE DELAY IN MAKING THE AWARD AND THE INCREASED COST OF RAW RUBBER THE COMPANY CONTENDS THAT IT SHOULD NOT BE HELD TO THE TERMS OF ITS PROPOSAL BUT EXPRESSES A WILLINGNESS TO FOREGO ALL PROFIT IN FURNISHING THE SUPPLIES BID UPON.

IT HAS BEEN HELD THAT AN OFFER OR BID MADE IN RESPONSE TO AN INVITATION FOR BIDS IS A CONTINUING OFFER TO REMAIN OPEN AND IN FORCE UNTIL ACCEPTED BY THE GOVERNMENT OR WITHDRAWN BY THE MAKER, AND THAT THE BIDDER WAS AT LIBERTY TO CANCEL OR WITHDRAW AN OFFER OR PROPOSAL AT ANY TIME BEFORE ACCEPTANCE; ALSO THAT A CONTRACTOR IS RELIEVED FROM THE TERMS OF AN OFFER NOT ACTED UPON OR ACCEPTED FOR AN UNREASONABLE TIME AFTER THE ADVERTISED DATE FOR OPENING BIDS. SEE 21 COMP. DEC. 523; 22 ID. 5; 21 OP.ATTY.GEN. 56. OTHER DECISIONS ARE TO THE EFFECT THAT WHERE PROPOSALS ARE NOT WITHDRAWN PRIOR TO ACCEPTANCE, THE INCREASED COSTS OF MATERIALS OCCURRING AFTER THE OPENING OF BIDS AND PRIOR TO AWARDS--- THERE BEING NO UNREASONABLE DELAY--- ARE NOT SUFFICIENT CAUSES FOR ADDITIONAL ALLOWANCES OVER THE AMOUNTS OF THE BIDS, NOR, UNDER REVERSE CONDITIONS, WOULD DECREASE IN PRICES BE GROUNDS FOR CORRESPONDING REDUCTIONS IN THE PRICES OFFERED. 24 COMP. DEC. 66; 3 COMP. GEN. 143.

THE PROPOSAL TO FURNISH THE RUBBER BANDS WAS NOT WITHDRAWN BY THE COMPANY PRIOR TO OPENING AND ACCEPTANCE NOR CAN IT NOW LAWFULLY BE WITHDRAWN; THEREFORE, THE QUESTION HERE FOR DETERMINATION AND DECISION GOES TO THE REASONABLENESS OF THE TIME TAKEN BY THE DEPARTMENT BEFORE ACCEPTING THE OFFER OF THE TYER RUBBER CO. WHILE IT IS STATED THAT DURING THE TIME INTERVENING BEFORE THE ACCEPTANCE OF THE BID, THE PRICE OF RAW RUBBER INCREASED 100 PERCENT, YOU ALSO STATE THAT THE DELAY IN MAKING THE AWARD OCCURRED ON ACCOUNT OF THE TIME REQUIRED FOR TESTS OF SAMPLES AND THE CHANNELS THROUGH WHICH THE RECOMMENDATIONS OF THE COMMITTEE OF AWARDS MUST PASS. IN THE CASE OF SCOTT V. UNITED STATES, 44 CT.CLS. 524, THE COURT, WITH REFERENCE TO THE DUTIES OF AGENTS OF THE GOVERNMENT IN LETTING CONTRACTS IN BEHALF OF THE UNITED STATES, SAID:

* * * THEY MUST ACCEPT THE LOWEST OR THE HIGHEST RESPONSIBLE BID, OR REJECT ALL AND READVERTISE. PRIVATE INDIVIDUALS ARE NOT REQUIRED THUS TO ACT. HENCE IT IS APPARENT THAT GOVERNMENT AGENTS SHOULD BE ALLOWED A REASONABLE TIME AFTER THE OPENING OF BIDS BEFORE THEY ARE ALLOWED TO BE WITHDRAWN, SO THEY CAN BE AFFORDED OPPORTUNITIES TO ASCERTAIN WHETHER COLLUSION OR FRAUD HAD BEEN PERPETRATED AGAINST THE UNITED STATES BY THE PARTIES ENGAGED IN THE BIDDING * * *.

UNDER THE CIRCUMSTANCES AS STATED THE DELAY ON THE PART OF THE DEPARTMENT CAN NOT BE SAID TO HAVE BEEN SO UNREASONABLE AS TO CONSTITUTE A CAUSE FOR RELIEVING THE BIDDER FROM THE CONSEQUENCES OF ITS OWN NEGLECT OR FROM THE PERFORMANCE OF ITS AGREEMENT. ANSWERING YOUR QUESTION SPECIFICALLY, YOU ARE ADVISED THAT THERE IS NO AUTHORITY TO RESCIND THE BID OR TO GRANT ANY OTHER RELIEF IN THE MATTER.