A-90548, NOVEMBER 29, 1937, 17 COMP. GEN. 451

A-90548: Nov 29, 1937

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OFFERED A PRICE ON ONLY ONE OF THE INDIVIDUAL ITEMS WHICH WAS HIGHER THAN THE OTHER BID ON SUCH ITEM. OFFERED A PRICE ON THE ENTIRE LOT WHICH WAS LOWER THAN THE OTHER LUMP-SUM BID. BASING ITS CLAIM THAT SAME WAS INTENDED TO COVER ONLY THE SIX ITEMS NOT COVERED BY ITS INDIVIDUAL BID ON THE CONTENTION THAT ITEM ONE BEING ON A SEPARATE SHEET OF THE INVITATION WAS EXCLUDED FROM THE LUMP-SUM BID. IF THE CONTRACT IS RESCINDED THE NEEDS OF THE GOVERNMENT SHOULD BE READVERTISED. ACCEPTANCE WAS MADE ON ITEM 8 OF ITS BID. TWO BIDS WERE RECEIVED IN RESPONSE TO THIS ADVERTISEMENT. BELOW IS A BRIEF SUMMARY OF THE ITEMS AND PRICES QUOTED. THE DUNHAM-PRICE LUMBER COMPANY ADDRESSED A LETTER TO THE REGIONAL OFFICE IN WHICH IT IS STATED THAT AT THE TIME THE BID WAS MADE OUT.

A-90548, NOVEMBER 29, 1937, 17 COMP. GEN. 451

CONTRACTS - MISTAKES - BIDS - OPTION OF RESCISSION OR PAYMENT AT BID PRICE WHERE ONE OF TWO BIDS SUBMITTED IN RESPONSE TO INVITATION REQUESTING BIDS ON SEVEN INDIVIDUAL ITEMS AS WELL AS LUMP-SUM BIDS TO FURNISH ALL SUCH ITEMS, OFFERED A PRICE ON ONLY ONE OF THE INDIVIDUAL ITEMS WHICH WAS HIGHER THAN THE OTHER BID ON SUCH ITEM, BUT OFFERED A PRICE ON THE ENTIRE LOT WHICH WAS LOWER THAN THE OTHER LUMP-SUM BID, AND BIDDER ALLEGES ERROR AFTER AWARD ON ITS LUMP-SUM BID, BASING ITS CLAIM THAT SAME WAS INTENDED TO COVER ONLY THE SIX ITEMS NOT COVERED BY ITS INDIVIDUAL BID ON THE CONTENTION THAT ITEM ONE BEING ON A SEPARATE SHEET OF THE INVITATION WAS EXCLUDED FROM THE LUMP-SUM BID, THE CONTRACTOR MAY NOT BE ALLOWED ANY AMOUNT IN ADDITION TO THE BID PRICE BUT MAY BE ALLOWED THE OPTION OF HAVING THE CONTRACT RESCINDED WITHOUT EXPENSE TO THE GOVERNMENT IN CONNECTION WITH THE RETURN OF THE MATERIAL DELIVERED THEREUNDER, OR OF BEING PAID ITS BID PRICE, AND, UNDER THE CIRCUMSTANCES, IF THE CONTRACT IS RESCINDED THE NEEDS OF THE GOVERNMENT SHOULD BE READVERTISED.

ACTING COMPTROLLER GENERAL ELLIOTT TO THE SECRETARY OF AGRICULTURE, NOVEMBER 29, 1937:

THERE HAS BEEN RECEIVED YOUR LETTER OF NOVEMBER 16, 1937, AS FOLLOWS:

ON SEPTEMBER 14, 1937, THE REGIONAL OFFICE OF THE SOIL CONSERVATION SERVICE AT SALINA, KANSAS, ENTERED INTO A CONTRACT WITH THE DUNHAM PRICE LUMBER COMPANY, GUTHRIE, OKLAHOMA, IN ACCEPTANCE OF ITS BID SUBMITTED IN RESPONSE TO INVITATION TO BID NUMBERED SCS-7-1129, UNDER WHICH BIDS OPENED AT SALINA, KANSAS, ON SEPTEMBER 14, 1937.

ACCEPTANCE WAS MADE ON ITEM 8 OF ITS BID, WHICH ITEM, AS AN ALTERNATE, PROVIDES FOR A LUMP SUM QUOTATIONS ON ITEMS 1 TO 7, INCLUSIVE. TWO BIDS WERE RECEIVED IN RESPONSE TO THIS ADVERTISEMENT, AND BELOW IS A BRIEF SUMMARY OF THE ITEMS AND PRICES QUOTED.

CHART

ITEM ARTICLE QUANTITY MASON'S DUNHAM-PRICE

CASH LUMBER CO.

LUMBER

1 DOORS, DOUGLAS FIR -------- 6 $19.50 $26.46

2 WINDOW, WHITE PINE -------- 1 2.50 -----

3 LOCKS, MORTISE ------------ 8 6.00 -----

4 HINGES, BUTT -------------- 12 4.80 -----

5 PAINT, OUTSIDE, WHITE ----- 2 6.50 -----

6 PAINT, OUTSIDE, BLACK ----- 2 6.50 -----

7 PAINT, OUTSIDE, RED ------- 2 8.00 -----

8 ALTERNATE, ITEMS 1 TO LOT 7,

INCLUSIVE --------------- -- 53.80 32.76

DISCOUNT: 5 PERCENT TO 10, NET.

2 PERCENT TO 20.

ON SEPTEMBER 29, 1937, THE DUNHAM-PRICE LUMBER COMPANY ADDRESSED A LETTER TO THE REGIONAL OFFICE IN WHICH IT IS STATED THAT AT THE TIME THE BID WAS MADE OUT, THE IMPRESSION WAS HAD THAT ITEM 1, CALLING FOR SIX DOORS, BEING ON A SEPARATE SHEET, WAS UNCONNECTED WITH ITEM 8 CALLING FOR QUOTATIONS ON ITEMS 1 TO 7, INCLUSIVE. IT IS FURTHER STATED THAT IT WAS INTENDED THAT THE BID AS SUBMITTED BE CONSTRUED AS A QUOTATION OF $26.46 ON THE DOORS UNDER ITEM 1 AND $32.76 ON ALL HARDWARE AND PAINT UNDER ITEMS 2 TO 7, INCLUSIVE. IN SHORT, IT IS CONTENDED THAT THE QUOTATION OF $32.76 ON ITEM 8 IS A LUMP SUM BID ON ITEMS 2 TO 7, INCLUSIVE, AND THAT THE TOTAL BID PRICE IS THE SUM OF ITEMS 1 AND 8, OR $59.22.

THE DUNHAM-PRICE LUMBER COMPANY IN ITS LETTER OF SEPTEMBER 29, 1937, ACKNOWLEDGES THE ERROR MADE AND REQUESTS RELIEF THROUGH A CORRECTION IN THE CONTRACT PRICE, INCREASING THE AMOUNT THEREOF TO $59.22.

THE REGIONAL PROCUREMENT OFFICER IN ACCEPTING THIS BID WAS NOT CHARGED WITH NOTICE OF ANY EXISTING ERROR, AND THE LOWER PRICE QUOTED BY THE DUNHAM-PRICE LUMBER COMPANY WAS NOT CONSIDERED TO BE OTHER THAN A COMPETITIVE DIFFERENCE.

ALL MATERIAL HAS BEEN DELIVERED BY THE CONTRACTOR; HOWEVER, IT IS BEING WITHHELD FROM USE PENDING SETTLEMENT OF THIS CONTROVERSY.

IT IS TO BE NOTED THAT THE BID SUBMITTED BY MASON'S CASH LUMBER, GUTHRIE, OKLAHOMA, PROPOSED TO FURNISH ALL MATERIALS FOR $53.80, LESS FIVE PERCENT- -- 10 DAYS, TWO PERCENT--- 20 DAYS, OR $51.11 NET, IF PAID WITHIN TEN DAYS, AS COMPARED WITH THE NET AMOUNT OF $59.22 NOW ASKED BY THE DUNHAM- PRICE LUMBER COMPANY.

ENCLOSED ARE ALL BIDS RECEIVED, AN ABSTRACT THEREOF, AND THE LETTER FROM DUNHAM-PRICE LUMBER COMPANY DATED SEPTEMBER 29, 1937, ATTACHING COPY OF ITS INVOICE NO. 7233 DATED SEPTEMBER 28, 1937, IN THE AMOUNT OF $59.22.

IT IS REQUESTED THAT THE FACTS PRESENTED HEREIN BE CONSIDERED, AND WITH THE RETURN OF ALL PAPERS THE DEPARTMENT BE ADVISED AS TO THE PROPER ACTION TO FOLLOW.

THE RECORD FACTS SUMMARIZED IN YOUR LETTER ARE SUFFICIENT TO AUTHORIZE RESCISSION OF THE CONTRACT BUT ARE NOT SUFFICIENT TO AUTHORIZE REFORMATION THEREOF. IT IS UNDERSTOOD THAT THE PLACE OF BUSINESS OF THE DUNHAM-PRICE LUMBER CO. IS GUTHRIE, OKLA., THAT THE ARTICLES DELIVERED HAVE NOT BEEN USED AND THAT THE SAME ARE BEING HELD BY THE SOIL CONSERVATION SERVICE AT GUTHRIE, OKLA. UNDER THE CIRCUMSTANCES THE DUNHAM-PRICE LUMBER CO. MAY BE ALLOWED THE OPTION OF HAVING THE CONTRACT RESCINDED WITH THE RETURN OF THE SUPPLIES WITHOUT EXPENSE TO THE GOVERNMENT, OR OF BEING PAID ONLY $32.76, ITS BID PRICE. IN THE EVENT OF THE FORMER, THE NEEDS OF THE GOVERNMENT SHOULD BE READVERTISED.