A-20989, JANUARY 14, 1928, 7 COMP. GEN. 414

A-20989: Jan 14, 1928

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CONTRACTS - MISTAKE IN BID - DISBURSING OFFICERS - RELIEF WHERE A BID TO FURNISH THE GOVERNMENT TELEPHONE BRACKETS HAS BEEN ACCEPTED THE BIDDER IS NOT ENTITLED TO RELIEF FOR ANY ADDITIONAL AMOUNT OVER AND ABOVE THE AMOUNT STIPULATED IN THE ACCEPTED BID ON THE GROUND OF AN ALLEGED MISTAKE HAVING BEEN MADE IN THE BID. UNLESS THERE WAS A MISTAKE OF FACT APPARENT ON THE FACE OF THE BID OR SUCH DISCREPANCY BETWEEN HIS BID AND THE OTHER BIDS SUBMITTED AS TO PUT THE GOVERNMENT CONTRACTING OFFICER ON NOTICE WHEN THE OFFER WAS ACCEPTED THAT A MISTAKE HAD BEEN MADE AND WHICH WOULD RAISE THE IMPLICATION THAT THE OFFER WAS ACCEPTED WITH THE INTENTION OF TAKING ADVANTAGE OF SUCH MISTAKE. WHENEVER THERE IS DOUBT AS TO WHETHER A PROPOSED PAYMENT IS AUTHORIZED THE MATTER SHOULD BE SUBMITTED TO THE GENERAL ACCOUNTING OFFICE.

A-20989, JANUARY 14, 1928, 7 COMP. GEN. 414

CONTRACTS - MISTAKE IN BID - DISBURSING OFFICERS - RELIEF WHERE A BID TO FURNISH THE GOVERNMENT TELEPHONE BRACKETS HAS BEEN ACCEPTED THE BIDDER IS NOT ENTITLED TO RELIEF FOR ANY ADDITIONAL AMOUNT OVER AND ABOVE THE AMOUNT STIPULATED IN THE ACCEPTED BID ON THE GROUND OF AN ALLEGED MISTAKE HAVING BEEN MADE IN THE BID, UNLESS THERE WAS A MISTAKE OF FACT APPARENT ON THE FACE OF THE BID OR SUCH DISCREPANCY BETWEEN HIS BID AND THE OTHER BIDS SUBMITTED AS TO PUT THE GOVERNMENT CONTRACTING OFFICER ON NOTICE WHEN THE OFFER WAS ACCEPTED THAT A MISTAKE HAD BEEN MADE AND WHICH WOULD RAISE THE IMPLICATION THAT THE OFFER WAS ACCEPTED WITH THE INTENTION OF TAKING ADVANTAGE OF SUCH MISTAKE. IN THE ABSENCE OF STATUTORY PROVISION THEREFOR, OPINIONS OR INSTRUCTIONS OF THE HEAD OF AN ADMINISTRATIVE DEPARTMENT OR ESTABLISHMENT CAN AFFORD NO PROTECTION TO A DISBURSING OFFICER AGAINST DISALLOWANCES ON ACCOUNT OF ILLEGAL OR IMPROPER PAYMENTS. WHENEVER THERE IS DOUBT AS TO WHETHER A PROPOSED PAYMENT IS AUTHORIZED THE MATTER SHOULD BE SUBMITTED TO THE GENERAL ACCOUNTING OFFICE.

DECISION BY COMPTROLLER GENERAL MCCARL, JANUARY 14, 1928:

W. I. BIDDLE, SPECIAL DISBURSING AGENT, DEPARTMENT OF JUSTICE, REQUESTED NOVEMBER 17, 1927, REVIEW OF SETTLEMENT K-13628-J, DATED AUGUST 30, 1927, DISALLOWING CREDIT IN HIS DISBURSING ACCOUNTS IN THE SUM OF $4.50, BEING PART OF A PAYMENT OF $13.50 MADE ON VOUCHER 611, SEPTEMBER 7, 1926, TO THE COMMERCIAL ELECTRICAL SUPPLY CO., REPRESENTING THE DIFFERENCE BETWEEN THE BILLED PRICE AND BID PRICE ON THREE TELEPHONE BRACKETS PROCURED UNDER AN ACCEPTED PROPOSAL OF JUNE 21, 1926.

IT APPEARS THAT UNDER DATE OF JUNE 16, 1927, THE WARDEN OF THE UNITED STATES PENITENTIARY AT LEAVENWORTH, KANS., ACTING AS CONTRACTING OFFICER, ADVERTISED FOR BIDS TO BE OPENED JUNE 27, 1926, FOR THE FURNISHING OF CERTAIN SUPPLIES LISTED IN THE SAID ADVERTISEMENT FOR USE AT THE SAID PENITENTIARY, AMONG WHICH WAS AN ITEM FOR THREE TELEPHONE BRACKETS "EQUAL AS LISTED B-R ELECTRIC CO. CAT. NO. 24, PAGE 514, MFGS. NO. H87.' THE COMMERCIAL ELECTRICAL SUPPLY CO. SUBMITTED A UNIT PRICE BID OF $3 AND, BEING THE LOWEST BIDDER ON THIS ITEM, ITS BID WAS ACCORDINGLY ACCEPTED. THE NEXT LOWEST BID WAS THAT OF THE B. R. ELECTRIC CO., WHO OFFERED THE BRACKETS AT $4 EACH.

BY LETTER DATED JULY 21, 1926, THE SAID COMMERCIAL ELECTRICAL SUPPLY CO. ADVISED THE CONTRACTING OFFICER THAT IT HAD MADE A MISTAKE IN THE SUBMISSION OF ITS BID IN THAT THE PRICE QUOTED WAS $3 EACH, WHEREAS THE CORRECT PRICE WAS $4.50 EACH. THE MATTER WAS THEREUPON BROUGHT TO THE ATTENTION OF THE ATTORNEY GENERAL OF THE UNITED STATES AND THE CONTRACTING OFFICER WAS ADVISED IN A LETTER FROM ASSISTANT ATTORNEY GENERAL WILLEBRANDT, DATED JULY 30, 1926, AS FOLLOWS:

WITH FURTHER REFERENCE TO MY LETTER OF JULY 7, 1926, YOU ARE HEREBY AUTHORIZED TO PAY THE COMMERCIAL ELECTRIC SUPPLY CO. $4.50 EACH, INSTEAD OF $3.00 EACH, FOR THREE TELEPHONE BRACKETS INASMUCH AS THEIR LETTER OF JULY 21ST CLEARLY SHOWED THAT A BONA FIDE MISTAKE HAD BEEN MADE ON THEIR PART IN QUOTING THE PRICE OF $3.00 AND INASMUCH AS THE NEXT LOWEST BIDDER, THE B. R. ELECTRIC SUPPLY CO. REFUSED TO SUPPLY THESE BRACKETS AT $4.00 EACH, LEAVING THE COMMERCIAL ELECTRIC SUPPLY CO. STILL THE LOWEST BIDDER AT $4.50 EACH.

IN ACCORDANCE WITH THE SAID LETTER, THE CONTRACTOR FURNISHED THE SUPPLIES AND WAS PAID THE SUM OF $4.50 EACH, OR $1.50 MORE ON EACH BRACKET THAN THE AMOUNT OF THE BID, BEING A TOTAL OF $4.50 OVER AND ABOVE THE CONTRACT PRICE.

IN REQUESTING REVIEW OF THE SETTLEMENT, THE CONTRACTING OFFICER STATES IN HIS LETTER OF NOVEMBER 17, 1927, THAT:

THE BID OF THE CONTRACTOR WAS BASED UPON THE BRACKET NO. 87 WITHOUT THE HILO FEATURE, WHEREAS THE FEATURE WAS WANTED AND ORDERED. UPON RECEIPT OF ORDER, WHICH ALSO CONSTITUTED ACCEPTANCE OF THE BID, THE COMMERCIAL ELECTRIC CO. DISCOVERED THEIR MISTAKE AND NOTIFIED THE DISBURSING OFFICER OF SAME BEFORE THE ORDER WAS FILLED. THE ENTIRE MATTER WAS, THEREUPON, SUBMITTED BY THE DISBURSING OFFICER TO THE ATTORNEY GENERAL FOR DETERMINATION, WHO UPON A REVIEW OF FACTS IN THE CASE, HELD THAT THE COMMERCIAL ELECTRIC CO. MADE A BONA FIDE MISTAKE AND AUTHORIZED THE PAYMENT OF $4.50 PER BRACKET, INSTEAD OF $3.00. IT IS RESPECTFULLY SUBMITTED THAT THE DETERMINATION BY THE ATTORNEY GENERAL THAT A BONA FIDE MISTAKE HAD BEEN MADE, AND THAT THE COMMERCIAL ELECTRIC CO. WAS ENTITLED TO PAYMENT AT THE RATE OF $4.50 EACH INSTEAD OF $3.00, WAS FINAL AND CONCLUSIVE UPON THE DISBURSING OFFICER, IS RES JUDICATA, AND HE WAS BOUND THEREBY, AND WAS INCOMPETENT TO HOLD THAT THE MISTAKE WAS NOT BONA FIDE TO THE EXTENT THAT WOULD NOT PERMIT PAYMENT AS MADE.

TO HOLD THAT THE DISBURSING OFFICER, A SUBORDINATE, WAS REQUIRED TO INQUIRE INTO AND QUESTION THE CONCLUSION OF LAW REACHED BY THE ATTORNEY GENERAL, THE LEADING LAW OFFICER OF THE UNITED STATES, WOULD BE CONTRARY TO PUBLIC POLICY, AND WOULD HAVE THE EFFECT OF REQUIRING A SUBORDINATE OFFICER TO DISOBEY AND DISREGARD THE DETERMINATION OF HIS SUPERIORS.

IT IS FURTHER CONTENDED THAT THE ONLY QUESTION FOR DETERMINATION IS WHETHER OR NOT THIS EXPENDITURE OF $4.50 PER BRACKET WAS MADE IN ACCORDANCE WITH LAW, AS IT HAD PREVIOUSLY BEEN DETERMINED THAT THE ONLY BID SUBMITTED IN FACT BY THE COMMERCIAL ELECTRIC CO. WAS IN THAT AMOUNT IN VIEW OF THE BONA FIDE MISTAKE, AND TO HOLD OTHERWISE WOULD MAKE THE DISBURSING OFFICER RESPONSIBLE FOR A WRONG CONCLUSION REACHED BY THE ATTORNEY GENERAL, WHOSE INSTRUCTIONS WERE FOLLOWED IN DETAIL, THE DISBURSING OFFICER ACTING IN A PURELY MINISTERIAL CAPACITY IN THIS INSTANCE.

THE GENERAL RULE IS THAT WHERE THERE HAS BEEN A MISTAKE IN THE SUBMISSION OF A BID, THE CONTRACTOR MUST BEAR THE CONSEQUENCES THEREOF. IN ORDER TO AUTHORIZE RELIEF ON ACCOUNT OF MISTAKE IN AN ACCEPTED BID, THERE MUST APPEAR EITHER THAT THE MISTAKE WAS MUTUAL OR THAT THE ERROR WAS SO APPARENT THAT IT MUST BE PRESUMED THAT THE ACCEPTING OFFICER KNEW OF THE MISTAKE AND SOUGHT TO TAKE ADVANTAGE THEREOF. 26 COMP. DEC. 286; 2 COMP. GEN. 503; 3 ID. 821. NO SUCH SHOWING HAS BEEN MADE IN THIS CASE. WHILE CLAIMANT'S BID WAS LOWER THAN THAT OF THE OTHER BIDDERS, THERE IS NOTHING THEREIN FROM WHICH KNOWLEDGE ON THE PART OF THE CONTRACTING OFFICER THAT A MISTAKE HAD BEEN MADE MAY BE PRESUMED, NOR DOES A COMPARISON OF THE CLAIMANT'S BID WITH THE OTHER BIDS DISCLOSE ANY MISTAKE. THERE CAN BE NO RELIEF GRANTED FOR A UNILATERIAL MISTAKE OF FACT IN THE ABSENCE OF FRAUD OR CONCEALMENT. ELLICOTT MACHINE COMPANY V. UNITED STATES, 44 CT.CLS. 127; 1 COMP. GEN. 189.

THE BID WAS CLEAR AND UNAMBIGUOUS ON ITS FACE AND THE MISTAKE ALLEGED WAS DUE SOLELY TO THE NEGLIGENCE OF THE BIDDER, AND THE BID WAS ACCEPTED BY THE CONTRACTING OFFICER IN GOOD FAITH. ACCORDINGLY, PAYMENT IN EXCESS OF THE BID PRICE IN THIS CASE WAS NOT AUTHORIZED. 5 COMP. GEN. 46; 6 ID. 504; ID. 526; DECISIONS OF MARCH 30, APRIL 12, AND DECEMBER 20, 1927, A- 17876, A-17944, AND A-20821.

WITH REFERENCE TO THE CONTENTIONS OF THE CONTRACTING OFFICER THAT THE DETERMINATION BY THE ATTORNEY GENERAL THAT A BONA FIDE MISTAKE HAD BEEN MADE AND THAT THE COMMERCIAL ELECTRICAL SUPPLY CO. WAS ENTITLED TO PAYMENT AT THE RATE OF $4.50 FOR EACH BRACKET INSTEAD OF $3 WAS FINAL AND CONCLUSIVE ON THE DISBURSING OFFICER, DISBURSING OFFICERS HAVE BEEN REPEATEDLY ADVISED AS TO THE PROCEDURE TO BE FOLLOWED IN SUCH MATTERS AS HERE PRESENTED, AND IN ACCORDANCE WITH THE UNIFORM DECISIONS OF THIS OFFICE IT WAS THE PLAIN DUTY OF THE DISBURSING OFFICER IN THIS INSTANCE TO TRANSMIT THE VOUCHER, WITH FULL ADMINISTRATIVE REPORT AND RECOMMENDATION, TO THIS OFFICE FOR DECISION AS TO THE LEGALITY OF THE PROPOSED PAYMENT OR FOR CONSIDERATION AND SETTLEMENT AS A CLAIM. HAD THIS BEEN DONE IN THE INSTANT MATTER, THE OVERPAYMENT WOULD NOT HAVE RESULTED.

IN THE ABSENCE OF STATUTORY PROVISION THEREFOR OPINIONS OR INSTRUCTIONS FROM HEADS OF ADMINISTRATIVE DEPARTMENTS OR ESTABLISHMENTS CAN AFFORD NO PROTECTION TO A DISBURSING OFFICER AGAINST DISALLOWANCES ON ACCOUNT OF ILLEGAL OR IMPROPER PAYMENTS. IN THIS CONNECTION, ATTENTION IS INVITED TO SECTION 304 OF THE ACT OF JUNE 10, 1921, 42 STAT. 24, IN WHICH IT IS SPECIFICALLY PROVIDED THAT THE POWERS AND DUTIES VESTED AND IMPOSED UPON THE GENERAL ACCOUNTING OFFICE SHALL ,BE EXERCISED WITHOUT DIRECTION FROM ANY OTHER OFFICER" AND THAT THE "BALANCES CERTIFIED BY THE COMPTROLLER GENERAL SHALL BE FINAL AND CONCLUSIVE UPON THE EXECUTIVE BRANCH OF THE GOVERNMENT.'

UPON REVIEW THE SETTLEMENT IS SUSTAINED. THE SUM OF $4.50 SHOULD BE FORWARDED TO THIS OFFICE WITHOUT FURTHER DELAY.