A-60053, FEBRUARY 8, 1935, 14 COMP. GEN. 612

A-60053: Feb 8, 1935

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CLAIMING THAT CERTAIN COMPUTATIONS ENTERING INTO THE AMOUNT OF THE BID WERE MADE PRIOR TO RECEIVING ESTIMATES FROM SUBBIDDERS. AFTER THE PRICE HAD BEEN SUBMITTED BY THE SUBBIDDERS IT WAS FOUND THAT THE SUBBIDDERS HAD BEEN UNDERESTIMATED. SUCH EXPLANATION IS NOTHING MORE THAN AN ERROR IN JUDGMENT ON THE PART OF THE BIDDER AND DOES NOT CONSTITUTE MISTAKE SUCH AS WOULD RELIEVE THE BIDDER FROM THE OBLIGATIONS UNDER ITS BID. WHERE THE TIME LIMIT SPECIFIED IN THE BID FOR ACCEPTANCE IS NOT SUFFICIENT TO PERMIT FINAL DETERMINATION OF THE CLAIM OF MISTAKE BEFORE THE EXPIRATION THEREOF AND THE BIDDER REFUSES TO EXTEND THE TIME LIMIT PENDING SUCH DETERMINATION. THAT ITS BID IS ACCEPTED SUBJECT TO THE FINAL ACTION OF THE COMPTROLLER GENERAL ON THE PENDING CLAIM OF MISTAKE.

A-60053, FEBRUARY 8, 1935, 14 COMP. GEN. 612

CONTRACTS - TIME LIMIT WITHIN WHICH BID MUST BE ACCEPTED - MISTAKE IN BID WHERE A LOW BIDDER, SUBSEQUENT TO THE TIME SET FOR THE OPENING OF THE BIDS, ALLEGED A MISTAKE IN ITS BID AND REQUESTED TO WITHDRAW, CLAIMING THAT CERTAIN COMPUTATIONS ENTERING INTO THE AMOUNT OF THE BID WERE MADE PRIOR TO RECEIVING ESTIMATES FROM SUBBIDDERS, AND AFTER THE PRICE HAD BEEN SUBMITTED BY THE SUBBIDDERS IT WAS FOUND THAT THE SUBBIDDERS HAD BEEN UNDERESTIMATED, SUCH EXPLANATION IS NOTHING MORE THAN AN ERROR IN JUDGMENT ON THE PART OF THE BIDDER AND DOES NOT CONSTITUTE MISTAKE SUCH AS WOULD RELIEVE THE BIDDER FROM THE OBLIGATIONS UNDER ITS BID. HOWEVER, THE BID HAVING BEEN SUBMITTED ON CONDITION THAT THE BIDDER RECEIVE "WRITTEN NOTICE OF THE ACCEPTANCE WITHIN 20 DAYS AFTER THE DATE OF OPENING OF THE BIDS," AND NO NOTICE HAVING BEEN GIVEN WITHIN THE TIME LIMIT SO SPECIFIED AND THE BIDDER HAVING REFUSED TO EXTEND THE TIME LIMIT, THE BID MAY BE DISREGARDED. WHERE THE TIME LIMIT SPECIFIED IN THE BID FOR ACCEPTANCE IS NOT SUFFICIENT TO PERMIT FINAL DETERMINATION OF THE CLAIM OF MISTAKE BEFORE THE EXPIRATION THEREOF AND THE BIDDER REFUSES TO EXTEND THE TIME LIMIT PENDING SUCH DETERMINATION, THE BIDDER SHOULD BE NOTIFIED BEFORE THE EXPIRATION OF THE TIME LIMIT AND BEFORE FORWARDING THE MATTER TO THE COMPTROLLER GENERAL FOR CONSIDERATION AND DETERMINATION, THAT ITS BID IS ACCEPTED SUBJECT TO THE FINAL ACTION OF THE COMPTROLLER GENERAL ON THE PENDING CLAIM OF MISTAKE.

COMPTROLLER GENERAL MCCARL TO THE SECRETARY OF THE TREASURY, FEBRUARY 8, 1935:

THERE HAS BEEN RECEIVED YOUR LETTER OF JANUARY 28, 1935, AS FOLLOWS:

THIS DEPARTMENT ADVERTISED BETWEEN NOVEMBER 24 AND DECEMBER 15, 1934, FOR PROPOSALS TO FURNISH ALL LABOR AND MATERIAL IN THE CONSTRUCTION OF THE FLATBUSH POSTAL STATION, BROOKLYN, NEW YORK. DATE OF OPENING WAS FIXED AT 1:00 P.M., DECEMBER 21ST. THE REQUEST FOR PLANS, DATED DECEMBER 5TH, OF BARTLEY BROTHERS BUILDERS, INC., WAS RECEIVED DECEMBER 10TH AND PLANS WERE MAILED ON DECEMBER 11TH TO THE CORRECT ADDRESS, 23-36 36TH STREET, LONG ISLAND CITY, NEW YORK. DETAILED REQUIREMENTS AS TO LUMBER AND CARPENTER WORK WERE SET OUT IN PARAGRAPHS 605-765 OF THE SPECIFICATIONS.

ON DECEMBER 21ST, PRIOR TO OPENING, THE BID OF BARTLEY BROTHERS BUILDERS, INC., DATED DECEMBER 20, 1934, ACCOMPANIED BY GUARANTY CHECK, WAS RECEIVED. SUBSEQUENTLY, BUT PRIOR TO OPENING, A TELEGRAM WAS RECEIVED FROM THIS BIDDER DIRECTING THAT $4,000.00 BE DEDUCTED FROM ITS BID, MAKING THE BID $62,000.00. AT OPENING, THE ORIGINAL BID OF THIS BIDDER WAS FOUND TO BE $66,000.00, BUT THE DEDUCTION OF $4,000.00 MADE IT THE LOWEST OF TWENTY-TWO SUBMITTED.

ON DECEMBER 24TH, THE LOW BIDDER ADVISED THAT ITS TELEGRAPHIC BID WAS A MISTAKE AND THAT ITS PRICE WAS STILL $66,000.00. ON DECEMBER 26TH, IT SUBMITTED AN AFFIDAVIT SUPPORTED BY THE ORIGINAL ESTIMATE SHEET AND LETTERS FROM SUBBIDDERS AND REQUESTED PERMISSION TO WITHDRAW ITS BID OF $62,000.00. THE AFFIDAVIT STATED THAT THE PLANS BY MISTAKE HAD BEEN SENT TO 23-36 36TH STREET AND THAT THE BIDDER HAD ONLY FOUR WORKING DAYS TO PREPARE ITS FIGURES; THAT, BECAUSE OF THE HOLIDAYS, NOT ALL OF ITS SUBBIDS HAD BEEN RECEIVED; THAT AFTER MAILING, A REDUCTION OF $4,000.00 WAS FIGURED, BUT THAT ON RECEIPT OF SUBBIDS IT WAS FOUND THAT ROUGH LUMBER AND CARPENTRY HAD BEEN UNDERESTIMATED ABOUT $4,000.00. ON DECEMBER 28TH, THE LOW BIDDER DECLINED TO EXTEND THE TIME FOR CONSIDERATION OF ITS PROPOSAL TO JANUARY 31ST.

INVESTIGATION SHOWS THAT THE MISTAKE AROSE FROM MAKING THE ESTIMATE FOR ROUGH LUMBER AND CARPENTRY BEFORE RECEIVING SUBBIDS AND NOT FROM CLERICAL ERROR. NO EVIDENCE WAS SUBMITTED EXPLAINING WHY THE ORIGINAL BID WAS $4,000.00 HIGHER, OR SUPPORTING THE CLAIM OF DELAY IN THE MAILS. EXAMINATION OF THE BIDDER'S LETTER OF JANUARY 4, 1935, SHOWS THAT THEFLATBUSH POSTAL STATION IS THE FIRST GENERAL CONTRACT OF THIS SIZE EVER ESTIMATED BY IT.

THE LOW BIDDER HAS ADVISED THAT IT CANNOT PERFORM THE CONTRACT AT THE PRICE OF $62,000.00. THE TOTAL LIMIT OF COST FOR THE CONSTRUCTION OF THE ABOVE POSTAL STATION IS $130,000.00 AND THE UNOBLIGATED BALANCE AMOUNTS TO $69,175.00.

THE SECOND LOW BID RECEIVED, THAT OF RICHMOND ENGINEERING AND CONTRACTING CO., INC., NEW YORK, N.Y., WAS $64,900.00 (NO. 1), $64,700.00 (NO. 2), ALTERNATE A (ADD $900.00), ALTERNATE B (NO CHANGE), AND WAS ACCOMPANIED BY A SUFFICIENT BID BOND IN THE SUM OF $2,000.00. THIS DEPARTMENT CONSIDERS THAT THE SECOND LOW BIDDER, RICHMOND ENGINEERING AND CONTRACTING CO., INC., IS TECHNICALLY AND FINANCIALLY QUALIFIED. TIME TO CONSIDER THIS PROPOSAL HAS BEEN EXTENDED TO FEBRUARY 15TH. EXAMINATION OF THE SYNOPSIS SHOWS THAT MOST OF THE REMAINING BIDS ARE SUBSTANTIALLY HIGHER.

THE CASE IS SUBMITTED FOR YOUR CONSIDERATION AND DECISION AS TO WHETHER THE LOW BID OF BARTLEY BROTHERS BUILDERS, INC., IN THE SUM OF $62,000.00, ETC., MAY BE DISREGARDED AND THE SECOND LOW BID OF RICHMOND ENGINEERING AND CONTRACTING CO., INC., IN THE SUM OF $64,900.00, ETC.,ACCEPTED.

THE STANDARD GOVERNMENT INSTRUCTIONS TO BIDDERS, PARAGRAPH 14, WITH RESPECT TO WHICH ALL BIDDERS ARE PUT ON NOTICE AS TO THE PROVISIONS THEREOF, NOTIFIED ALL BIDDERS CONCERNED THAT NEGLIGENCE ON THE PART OF ANY BIDDER IN PREPARING HIS BID CONFERRED NO RIGHT FOR ITS WITHDRAWAL AFTER IT HAD BEEN OPENED. BIDDERS WERE ADVISED ALSO IN PARAGRAPH 19 OF SAID INSTRUCTIONS THAT---

19. ERRORS IN BID.--- BIDDERS OR THEIR AUTHORIZED AGENTS ARE EXPECTED TO EXAMINE THE MAPS, DRAWINGS, SPECIFICATIONS, CIRCULARS, SCHEDULE, AND ALL OTHER INSTRUCTIONS PERTAINING TO THE WORK, WHICH WILL BE OPEN TO THEIR INSPECTION. FAILURE TO DO SO WILL BE AT THE BIDDER'S OWN RISK, AND HE CANNOT SECURE RELIEF ON THE PLEA OF ERROR IN THE BID. IN CASE OF ERROR IN THE EXTENSION OF PRICES THE UNIT PRICE WILL GOVERN.

WITH RESPECT TO THE TELEGRAM OF MODIFICATION OF THE SAID BID WHICH WAS RECEIVED PRIOR TO THE OPENING OF THE BIDS, IT IS TO BE OBSERVED THAT STANDARD GOVERNMENT INSTRUCTIONS TO BIDDERS, IN PARAGRAPH 13, MAKE SPECIAL PROVISIONS THEREFOR, IT BEING PROVIDED AS FOLLOWS:

* * * UNLESS SPECIFICALLY AUTHORIZED, TELEGRAPHIC BIDS WILL NOT BE CONSIDERED, BUT MODIFICATIONS BY TELEGRAPH OF BIDS ALREADY SUBMITTED WILL BE CONSIDERED IF RECEIVED PRIOR TO THE HOUR SET FOR OPENING.

THE LOW BIDDER IN THIS INSTANCE DID NOT REQUEST WITHDRAWAL OF THE BID PRIOR TO THE TIME FIXED FOR OPENING, AND THERE HAS NOT BEEN ESTABLISHED SUCH A MISTAKE AS WOULD AUTHORIZE REFORMATION OR WITHDRAWAL OF THE BID.

THE BID WAS AS INTENDED. THE TELEGRAM OF MODIFICATION REDUCING THE BID $4,000 IS AS MUCH A PART OF THE BID AND HAS THE SAME FORCE AND EFFECT AS IF THE TOTAL PRICE HAD BEEN $62,000 IN THE FORMAL BID AS FIRST SUBMITTED. THE ALLEGED MISTAKE IS THAT THE BIDDER FIGURED THE ROUGH LUMBER AND CARPENTRY PRIOR TO RECEIVING ESTIMATES FROM SUBBIDDERS AND THAT AFTER THE PRICE HAD BEEN SUBMITTED BY THE SUBBIDDERS, IT WAS FOUND THAT THE ROUGH LUMBER AND CARPENTRY HAD BEEN UNDERESTIMATED ABOUT $4,000. THIS ERROR IN JUDGMENT ON THE PART OF THE BIDDER IN SUBMITTING ITS BID DOES NOT CONSTITUTE MISTAKE SUCH AS WOULD RELIEVE THE SAID BIDDER FROM THE OBLIGATIONS UNDER ITS BID.

HOWEVER, THE BID WAS SUBMITTED ON CONDITION THAT THE BIDDER RECEIVE "WRITTEN NOTICE OF THE ACCEPTANCE WITHIN 20 DAYS AFTER THE DATE OF OPENING OF THE BIDS.' THE DATE OF OPENING WAS DECEMBER 21, 1934, AND THE BIDDER HAD NOT YET RECEIVED WRITTEN (OR OTHER) NOTICE OF ACCEPTANCE OF ITS BID AND BY LETTER OF DECEMBER 28, 1934, IT REFUSED TO EXTEND THE TIME FOR ACCEPTANCE. ACCORDINGLY, SAID BID MAY BE DISREGARDED IN MAKING THE AWARD.

IT IS SUGGESTED THAT, SHOULD A SIMILAR SITUATION ARISE HEREAFTER--- THAT IS, WHERE THE TIME SPECIFIED FOR ACCEPTANCE IS NOT SUFFICIENT TO PERMIT FINAL DETERMINATION OF THE CLAIM OF MISTAKE BEFORE THE EXPIRATION THEREOF AND THE BIDDER REFUSES TO EXTEND THE TIME LIMIT PENDING SUCH DETERMINATION --- THE BIDDER BE NOTIFIED BEFORE THE EXPIRATION OF THE TIME SPECIFIED AND BEFORE FORWARDING THE MATTER TO THIS OFFICE FOR CONSIDERATION AND DETERMINATION, THAT ITS BID IS ACCEPTED SUBJECT TO THE FINAL ACTION OF THIS OFFICE ON THE PENDING CLAIM OF MISTAKE. SUCH A PROCEDURE WOULD PROTECT THE INTERESTS OF THE UNITED STATES AND TEND TO PREVENT A BIDDER FROM ALLEGING MISTAKE MERELY FOR THE PURPOSE OF CAUSING DELAY IN ACCEPTANCE SO AS TO AVOID THE CONSEQUENCES OF AN ILL-ADVISED BID.