A-13381, MARCH 31, 1926, 5 COMP. GEN. 781

A-13381: Mar 31, 1926

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WAS NOT SO UNREASONABLY LOW AS COMPARED WITH OTHER BIDS RECEIVED THAT THE CONTRACTING OFFICER MUST HAVE KNOWN THAT THE BIDDER HAD MADE A MISTAKE. SAID BID WAS ACCEPTED. BIDS WERE REQUESTED OF VARIOUS DEALERS FOR THE FURNISHING OF CERTAIN SUPPLIES TO THE WAR DEPARTMENT TO BE DELIVERED AT VARIOUS ARMY POSTS STIPULATED THEREIN. INCLUDED IN THE LIST OF SUPPLIES ON WHICH BIDS WERE REQUESTED. WAS- - SUGAR. IT WAS ADVISED BY WIRE AS FOLLOWS: AWARD MADE YOU SUGAR GRANULATED OGLETHORPE PROPOSAL FIVE CONTINGENT RECEIPT SATISFACTORY SAMPLE AND QUANTITY CONTINGENT ALLOTMENT SUFFICIENT FUNDS. REPLY WAS MADE TO THIS MESSAGE AS FOLLOWS: * * * WE ARE MAILING YOU UNDER SEPARATE COVER ONE POUND GRANULATED SUGAR FOR SAMPLE.

A-13381, MARCH 31, 1926, 5 COMP. GEN. 781

CONTRACTS - MISTAKE IN BID WHERE A VENDOR SUBMITTED A BID FOR THE FURNISHING OF SUPPLIES TO THE GOVERNMENT WHICH, THOUGH THE LOWEST, WAS NOT SO UNREASONABLY LOW AS COMPARED WITH OTHER BIDS RECEIVED THAT THE CONTRACTING OFFICER MUST HAVE KNOWN THAT THE BIDDER HAD MADE A MISTAKE, AND SAID BID WAS ACCEPTED, THE VENDOR MAY NOT AT A LATER DATE AVOID HIS OBLIGATION BY ALLEGING A MISTAKE IN THE BID.

DECISION BY COMPTROLLER GENERAL MCCARL, MARCH 31, 1926:

REVIEW HAS BEEN REQUESTED OF SETTLEMENT NO. 038242, DATED FEBRUARY 16, 1926, DISALLOWING THE CLAIM OF FOX BROS. CO. (INC.) FOR $102, THE DIFFERENCE BETWEEN PRICE OF $0.0595 AND $0.0495 PER POUND ON 10,200 POUNDS OF SUGAR FURNISHED THE WAR DEPARTMENT BY THE CLAIMANT UNDER ITS PROPOSAL OF AUGUST 11, 1925.

ON JULY 30, 1925, BIDS WERE REQUESTED OF VARIOUS DEALERS FOR THE FURNISHING OF CERTAIN SUPPLIES TO THE WAR DEPARTMENT TO BE DELIVERED AT VARIOUS ARMY POSTS STIPULATED THEREIN. INCLUDED IN THE LIST OF SUPPLIES ON WHICH BIDS WERE REQUESTED, AND APPEARING AS ITEM 115, WAS- - SUGAR, GRANULATED, SACKS OR BARRELS, 10,200 POUNDS, TO BE DELIVERED AT FORT OGLETHORPE, GA. THE CLAIMANT SUBMITTED AN OFFER TO FURNISH THIS ITEM FOR $4.95 PER HUNDREDWEIGHT, AND ON AUGUST 14, 1925, IT WAS ADVISED BY WIRE AS FOLLOWS:

AWARD MADE YOU SUGAR GRANULATED OGLETHORPE PROPOSAL FIVE CONTINGENT RECEIPT SATISFACTORY SAMPLE AND QUANTITY CONTINGENT ALLOTMENT SUFFICIENT FUNDS. REQUEST POUND SAMPLE BE SENT HERE IMMEDIATELY. ADVISE ACTION.

ON AUGUST 15, 1925, REPLY WAS MADE TO THIS MESSAGE AS FOLLOWS:

* * * WE ARE MAILING YOU UNDER SEPARATE COVER ONE POUND GRANULATED SUGAR FOR SAMPLE.

A PURCHASE ORDER COVERING THE PURCHASE WAS ISSUED ON AUGUST 20, 1925, AND ON THE SAME DATE THE BIDDER ADDRESSED THE FOLLOWING LETTER TO THE PURCHASING OFFICER:

REFERRING TO YOUR PROPOSAL DATED JULY 30TH AND OUR BID WHICH WAS OPENED 11.00 A.M. AUGUST 14TH.

FROM THE RECORD RETAINED IN OUR OFFICE, WE ARE AFRAID AN ERROR HAS BEEN MADE ON THE ITEM NO. 115 COVERING 10,240 LBS. SUGAR FOR DELIVERY TO FORT OGLETHORPE, GEORGIA. THE PRICE INSERTED WAS INTENDED TO BE $5.95 PER CWT. AND IF YOUR RECORDS DO NOT SO READ, PLEASE CORRECT TO CORRESPOND.

THIS WAS FOLLOWED BY A SECOND LETTER DATED AUGUST 22, 1925, IN WHICH IT WAS STATED THAT THE BID OF $0.0495 ON SUGAR WAS AN ERROR IN TRANSCRIPTION AND SHOULD HAVE READ $0.0595 AND THAT "THIS SUGAR SALE, AFTER DEDUCTING DRAYAGE TO FORT OGLETHORPE, WOULD HAVE SHOWN US A NET PROFIT OF 00.' THE PURCHASING OFFICER ADVISED THE BIDDER UNDER DATE OF AUGUST 24, 1925, THAT ALL THREE NUMBERS OF ITS BID SHOWED A PRICE OF $4.95 PER HUNDREDWEIGHT, AND THAT HE WAS WITHOUT AUTHORITY TO CHANGE THE PRICE FROM $4.95 TO $5.95 AS REQUESTED BECAUSE OF ITS MISTAKE AND THUS ALTER THE TERMS OF THE CONTRACT FORMED BETWEEN IT AND THE UNITED STATES. IT WAS FURTHER STATED IN THIS LETTER THAT THE AWARD WAS MADE TO THE CLAIMANT BECAUSE IT WAS THE LOWEST BIDDER AND TO PERMIT THE CHANGE IN PRICE WOULD BE UNFAIR TO COMPETITORS WHOSE BIDS WERE LOWER THAN $5.95 PER HUNDREDWEIGHT. THE CLAIMANT WAS FURTHER ADVISED THAT THE SUGAR WAS URGENTLY NEEDED AND THAT IT WAS EXPECTED THAT DELIVERY WOULD BE MADE AT ONCE. FOLLOWING THIS LETTER A TELEGRAM WAS SENT ON AUGUST 27, 1925, REQUESTING IMMEDIATE DELIVERY OF THE SUGAR "SUBJECT TO ADJUSTMENT OF PRICE SUGAR LATER.' THE CLAIMANT REPLIED TO THIS MESSAGE ON THE SAME DATE, AS FOLLOWS:

WILL DELIVER SUGAR QUARTERMASTER OGLETHORPE TO-MORROW AT 5.95 PER HUNDRED. IF THIS PRICE NOT SATISFACTORY ADVISE QUICK.

IN ANSWER TO THIS THE PURCHASING OFFICER REPLIED: "MAKE DELIVERY SUGAR OGLETHORPE.' THE SUGAR WAS DELIVERED AND ON AUGUST 28, 1925, THE CLAIMANT ADVISED THE PURCHASING OFFICER THAT "WE HAVE TODAY EFFECTED DELIVERY OF 10,200 POUNDS OF GRANULATED SUGAR ON BASIS OF $5.95 PER HUNDREDWEIGHT, OR $0.0595 PER POUND.' BILL WAS RENDERED FOR THE SUGAR DELIVERED AT $5.95 PER HUNDREDWEIGHT BUT PAYMENT WAS REFUSED ON THAT BASIS AND A VOUCHER PREPARED COVERING THE PURCHASE AT $4.95 PER HUNDREDWEIGHT, WHICH THE CLAIMANT REFUSED TO ACCEPT. THE MATTER WAS THEREUPON REFERRED TO THIS OFFICE WHERE, BY THE SETTLEMENT HERE UNDER REVIEW, THE SUM OF $504.90 WAS ALLOWED THE CLAIMANT, BEING PAYMENT IN FULL AT $4.95 PER HUNDREDWEIGHT FOR THE SUGAR RECEIVED, AND THE CLAIMANT REQUESTS REVIEW OF THIS ACTION, ALLEGING THAT IT IS ENTITLED TO PAYMENT AT $5.95 PER HUNDREDWEIGHT.

THE INSTRUCTIONS TO BIDDERS INCORPORATED IN THE ADVERTISEMENT OF BIDS CONTAINED THE FOLLOWING PROVISIONS AND STIPULATIONS:

SEALED PROPOSALS, IN TRIPLICATE, SUBJECT TO THE CONDITIONS OF THIS ADVERTISEMENT AND THE FOLLOWING INSTRUCTIONS TO BIDDERS, WILL BE RECEIVED AT THIS OFFICE UNTIL 11.00 A.M. AUGUST 14, 1925, AT WHICH TIME AND PLACE THEY WILL BE OPENED * * *.

9. BIDDERS MUST EXERCISE THE NECESSARY PRECAUTIONS TO INSURE THAT THEIR PROPOSAL IS COMPLETE AND THAT THE PRICE OF EACH ARTICLE IS CORRECTLY STATED. IT MUST BE ASSUMED THAT BIDDERS HAVE FULLY INFORMED THEMSELVES AS TO THE CONDITIONS, REQUIREMENTS, AND SPECIFICATIONS BEFORE SUBMITTING THEIR PROPOSALS, AND THAT THEY CAN NOT EXPECT TO BE EXCUSED OR RELIEVED FROM RESPONSIBILITY ASSUMED BY THEIR PROPOSALS ON THE PLEA OF ERROR; BUT WHEN ERRORS HAVE BEEN MADE BY BIDDERS IN SUBMITTING THEIR PROPOSALS, WHICH WERE NOT DISCOVERED PRIOR TO OPENING OF BIDS, THE SAME MAY BE CONSIDERED WITH A VIEW TO ADJUSTMENT, PROVIDED THE INTERESTS OF THE GOVERNMENT AND OTHER BIDDERS CONCERNED WILL NOT BE JEOPARDIZED BY SUCH ACTION.

10. BIDDERS MAY WITHDRAW THEIR PROPOSALS ANY TIME PRIOR TO THE HOUR SET FOR OPENING UPON WRITTEN REQUEST TO THE PURCHASING OFFICER RECEIVING THE BIDS. WHEN SEALED PROPOSALS HAVE BEEN SUBMITTED BY A BIDDER AND HE FINDS IT NECESSARY TO CHANGE THE PRICES OR QUANTITIES, AND IT IS IMPRACTICABLE BECAUSE OF THE DISTANCE BETWEEN HIS PLACE OF BUSINESS AND THE OFFICE RECEIVING THE PROPOSALS TO WITHDRAW THE PROPOSAL BEFORE THE HOUR SET FOR OPENING, HE MAY CHANGE HIS PROPOSAL BY LETTER OR TELEGRAM, PROVIDED THE SAME IS RECEIVED BY THE PURCHASING OFFICER PRIOR TO THE HOUR SET FOR THE OPENING OF BIDS. PROPOSALS FOR WHICH WRITTEN NOTICE OF WITHDRAWAL HAS BEEN RECEIVED BY THE PURCHASING OFFICER WILL, UPON BEING REACHED AT THE OPENING, BE RETURNED TO THE BIDDER UNOPENED. PROPOSALS FOR WHICH CHANGES BY LETTER OR TELEGRAM HAVE BEEN RECEIVED JUST PRIOR TO THE OPENING WILL, UPON BEING REACHED AT THE OPENING, BE READ ACCORDING TO THE CHANGES IN SUCH LETTER OR TELEGRAM.

THE CLAIMANT SUBMITTED ITS BID ON AUGUST 11 WITH THE FULL KNOWLEDGE THAT IT WOULD BE OPENED AT 11 A.M., AUGUST 14, 1925, AND IT WAS NOT UNTIL SIX DAYS AFTER THE OPENING OF THE BIDS THAT THE QUARTERMASTER'S OFFICE WAS ADVISED OF THE ALLEGED ERROR IN PRICE. WHATEVER RIGHT IT HAD TO WITHDRAW ITS BID WAS LOST WHEN THE BIDS WERE OPENED, AND SINCE ITS OFFER WAS THEN IRREVOCABLE, IT WAS BOUND TO FURNISH THE GOODS AT THE PRICE STIPULATED IN SAID OFFER UNLESS THE TERMS THEREOF WERE SO UNREASONABLE AS TO PUT THE PURCHASING OFFICER ON NOTICE THAT AN ERROR HAD BEEN MADE. WHILE THE PRICE WHICH IT ALLEGES WAS INTENDED WAS 1 CENT PER POUND HIGHER THAN THAT ACTUALLY QUOTED, ANOTHER BIDDER QUOTED A PRICE ONLY SLIGHTLY IN EXCESS OF $4.95 PER HUNDREDWEIGHT AND THE PURCHASING OFFICER WAS JUSTIFIED IN ASSUMING THAT THE BID OF $4.95 EXPRESSED THE TRUE INTENTION OF THE BIDDER. FURTHERMORE, HAD A PRICE OF $5.95 BEEN QUOTED, THE CLAIMANT WOULD NOT HAVE RECEIVED THE ORDER AS HEREINBEFORE SHOWN, CLAIMANT HAD BEEN SPECIFICALLY ADVISED THAT IT COULD NOT EXPECT TO BE RELIEVED FROM ITS OBLIGATION ON THE PLEA OF ERROR AND THAT IT WOULD BE BOUND BY ITS OFFER IF NOT WITHDRAWN OR CHANGED BEFORE HOUR SET FOR OPENING OF BIDS. THE CLAIMANT CONTENDS THAT IT WAS INDUCED TO MAKE DELIVERY OF THE GOODS THROUGH STATEMENTS OF THE PURCHASING OFFICER WHICH IT CONSTRUED AS BEING AN AGREEMENT TO PAY A PRICE OF $5.95 PER HUNDREDWEIGHT. HOWEVER THAT MAY BE, IT DOES NOT AFFECT THE MERITS OF THE CLAIM, FOR THE CLAIMANT DID NO MORE THAN IT WAS LEGALLY OBLIGATED TO DO IN MAKING THE DELIVERY, AND AS IT HAS BEEN PAID IN FULL AT THE PRICE WHICH THE GOVERNMENT WAS LEGALLY OBLIGATED TO PAY, THERE IS NOTHING FURTHER DUE IT. ..END :