A-89797, DECEMBER 17, 1937, 17 COMP. GEN. 517

A-89797: Dec 17, 1937

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IT IS EVIDENT THAT THE AWARD WAS UNAUTHORIZED AND SHOULD BE CANCELED. WHILE TWO OF THE OTHER BIDS WERE IN THE AMOUNT OF $10 PER CASE. A FIFTH BID WAS AT $9.10 PER CASE. THERE WAS ALSO A BID AT THE RATE OF $1 PER CASE. HAS INSISTED THAT ITS BID WAS ON THE BASIS OF $0.95 PER M. WHICH IS THE UNIT SAID TO BE USED IN BUYING AND SELLING THE PAPER CUPS. HAS REPORTED THAT WHILE THE BIDS WERE OPENED MARCH 24. THE VOLUME OF WORK WAS SUCH THAT IT WAS APRIL 2 BEFORE COMPLETE TABULATION OF AWARDS COULD BE MADE AND THAT IT WAS NOT UNTIL THEN THERE WAS NOTED THE DISPROPORTIONATE BID OF THE MATHERS-LAMM PAPER CO. THAT SINCE THE CONTRACTS WERE FOR DELIVERIES DURING THE MONTHS OF APRIL. HIS OFFICE BELIEVED IT WAS NECESSARY TO AWARD THE CONTRACTS AND THAT CLEARANCE WAS NOT REQUESTED TO DISREGARD THE DISPROPORTIONATE BIDS ON THIS ITEM.

A-89797, DECEMBER 17, 1937, 17 COMP. GEN. 517

CONTRACTS - AWARD ON MISTAKEN BID - CANCELATION - READVERTISEMENT RATHER THAN FURTHER AWARD UNDER PRIOR BIDS WHERE, NOTWITHSTANDING THE URGENT NEED REPORTED AS JUSTIFICATION FOR THE ACCEPTANCE OF A KNOWN ERRONEOUS BID, DELIVERY HAS NOT YET BEEN MADE, IT IS EVIDENT THAT THE AWARD WAS UNAUTHORIZED AND SHOULD BE CANCELED, AND IN VIEW OF THE LAPSE OF TIME SINCE THE OPENING OF THE BIDS, THE SUPPLIES, IF NEEDED, SHOULD BE OBTAINED BY READVERTISEMENT AND NOT BY FURTHER AWARD UNDER THE PRIOR BIDS.

ACTING COMPTROLLER GENERAL ELLIOTT TO THE SECRETARY OF THE TREASURY, DECEMBER 17, 1937:

THERE HAS BEEN RECEIVED IN RESPONSE TO MY LETTER OF OCTOBER 27, 1937, TREASURY DEPARTMENT REPORT OF DECEMBER 7, 1937, WITH RESPECT TO AN ALLEGED MISTAKE MADE BY THE MATHERS-LAMM PAPER CO., WASHINGTON, D.C., IN ITS BID OPENED MARCH 24, 1937, AT JACKSONVILLE, FLA., FOR THE DELIVERY OF ITEM 25, CONSISTING OF 26 CASES, 10,000 TO THE CASE, OF "PURITAN OR AN APPROVED EQUAL" PAPER CUPS AS TO WHICH THAT COMPANY SUBMITTED A BID OF $0.95 PER CASE, WHILE TWO OF THE OTHER BIDS WERE IN THE AMOUNT OF $10 PER CASE, TWO IN THE AMOUNT OF $10.50 PER CASE, AND A FIFTH BID WAS AT $9.10 PER CASE. THERE WAS ALSO A BID AT THE RATE OF $1 PER CASE. THE MATHERS-LAMM PAPER CO. HAS INSISTED THAT ITS BID WAS ON THE BASIS OF $0.95 PER M, WHICH IS THE UNIT SAID TO BE USED IN BUYING AND SELLING THE PAPER CUPS.

THE TREASURY DEPARTMENT PROCUREMENT OFFICER AT JACKSONVILLE, FLA., HAS REPORTED THAT WHILE THE BIDS WERE OPENED MARCH 24, 1937, THE VOLUME OF WORK WAS SUCH THAT IT WAS APRIL 2 BEFORE COMPLETE TABULATION OF AWARDS COULD BE MADE AND THAT IT WAS NOT UNTIL THEN THERE WAS NOTED THE DISPROPORTIONATE BID OF THE MATHERS-LAMM PAPER CO. AS WELL AS THE DISPROPORTIONATE BID OF THE JAX PAPER CO. FURTHER, THAT SINCE THE CONTRACTS WERE FOR DELIVERIES DURING THE MONTHS OF APRIL, MAY, AND JUNE, HIS OFFICE BELIEVED IT WAS NECESSARY TO AWARD THE CONTRACTS AND THAT CLEARANCE WAS NOT REQUESTED TO DISREGARD THE DISPROPORTIONATE BIDS ON THIS ITEM.

THE REPORT IS INCOMPLETE IN THAT IT MAKES NO MENTION OF, OR RECOMMENDATION WITH RESPECT TO, THE REQUEST IN THE LETTER OF OCTOBER 20, 1937, FROM MATHERS-LAMM PAPER CO., THAT THE ORDER ISSUED TO IT FOR DELIVERY OF THE PAPER CUPS BE CANCELED OR THAT THE COMPANY BE PERMITTED TO PROCEED WITH THE ORDER AT $9.50 PER CASE, THUS INDICATING THAT THE CUPS HAD NOT BEEN FURNISHED BY OCTOBER 20, ALTHOUGH, APPARENTLY, THEY WERE NEEDED FOR APRIL, MAY, AND JUNE 1937. THERE IS NO SHOWING AS TO WHAT WAS DONE ABOUT SECURING THE NECESSARY PAPER CUPS DURING THE INTERVENING PERIOD.

IT SEEMS CLEAR THAT THE MATHERS-LAMM PAPER CO. DID MAKE A MISTAKE AND THAT THE MISTAKE WAS NOTED BY THE PROCUREMENT OFFICER APRIL 2, 1937, BEFORE THE AWARD WAS MADE. UNDER THESE CIRCUMSTANCES THE ERRONEOUS BID ON SAID ITEM--- ONLY ONE-TENTH OF WHAT IT WAS INTENDED TO BE--- SHOULD NOT HAVE BEEN ACCEPTED. AND SINCE DELIVERY HAS NOT BEEN MADE, THE AWARD AS TO SAID ITEM 25 SHOULD BE CANCELED. ALSO, IN VIEW OF THE LAPSE OF TIME SINCE THE BIDS WERE OPENED, NO PURCHASES OF CUPS SHOULD BE MADE AS THE RESULT OF SUCH BIDS. IF PAPER CUPS ARE NOW NEEDED, THERE SHOULD BE READVERTISEMENT THEREFOR.