B-100369, JAN 17, 1951

B-100369: Jan 17, 1951

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THE SECRETARY OF THE AIR FORCE: I HAVE YOUR LETTER OF DECEMBER 27. TO HAVE BEEN MADE ON ITEM NO. 12 OF ITS BID DATED AUGUST 8. IS BASED. THE BID OF THE COMPANY WAS NOT FORWARDED TO THIS OFFICE BUT IT APPEARS THAT THE COMPANY OFFERED TO FURNISH THE FOLLOWING ARTICLES AT THE PRICES INDICATED: (CHART OMITTED) THE BID WAS ACCEPTED AS TO FIVE ITEMS. THE ERROR WAS MADE IN POINTING OFF THE DECIMAL AND DID NOT EFFECT THE EXTENSION OF THE ITEM. "YOU ASKED THAT WE ATTACH ANY WORK PAPERS THAT WE MIGHT HAVE THAT WOULD BEAR OUT THIS ERROR. WE ARE HEREWITH ATTACHING A WORK PAPER WHICH WAS GOTTEN UP FOR THE STENOGRAPHER WHO FILLED IN THE INVITATION TO BID. YOU WILL NOTICE. THIS IS VERY EVIDENT. BECAUSE ITEM NO. 13 WAS OF A SIMILAR PRICE AND AS YOU CAN SEE THE TWO EXTENSIONS WERE VERY CLOSE.".

B-100369, JAN 17, 1951

PRECIS-UNAVAILABLE

THE HONORABLE, THE SECRETARY OF THE AIR FORCE:

I HAVE YOUR LETTER OF DECEMBER 27, 1950, WITH ENCLOSURES, RELATIVE TO AN ERROR ALLEGED BY THE ATLANTA PAPER COMPANY, ATLANTA, GEORGIA, TO HAVE BEEN MADE ON ITEM NO. 12 OF ITS BID DATED AUGUST 8, 1950, UPON WHICH CONTRACT NO. AF 40 (087)-101, DATED AUGUST 10, 1950, IS BASED. YOU REQUEST A DECISION AS TO WHETHER THE CONTRACT MAY BE MODIFIED SO AS TO PROVIDE A UNIT PRICE OF $0.23958 FOR THE BOXES FURNISHED UNDER SAID ITEM NO. 12.

THE MALLORY AIR FORCE SPECIALIZED DEPOT, MEMPHIS, TENNESSEE, BY INVITATION NO. 40-087-51-2 REQUESTED BIDS-- TO BE OPENED AUGUST 9, 1950 - FOR FURNISHING 16 ITEMS OF FIBERBOARD BOXES. IN RESPONSE THERETO, THE ATLANTA PAPER COMPANY SUBMITTED A BID IN WHICH IT QUOTED PRICES ON ELEVEN ITEMS. THE BID OF THE COMPANY WAS NOT FORWARDED TO THIS OFFICE BUT IT APPEARS THAT THE COMPANY OFFERED TO FURNISH THE FOLLOWING ARTICLES AT THE PRICES INDICATED:

(CHART OMITTED)

THE BID WAS ACCEPTED AS TO FIVE ITEMS, INCLUDING ITEM NO. 12, IN THE AGGREGATE AMOUNT OF $5,004.25.

UPON RECEIPT OF THE CONTRACT THE COMPANY, BY TELEPHONE CALL OF AUGUST 24, 1950, ALLEGED ERROR IN ITS BID WITH RESPECT TO THE UNIT PRICE IT QUOTED ON ITEM NO. 12 AND, BY CONFIRMING LETTER DATED OCTOBER 16, 1950, THE COMPANY FORWARDED ITS ORIGINAL WORK SHEET AND ADVISED, IN PERTINENT PART, AS FOLLOWS:

"AS EXPLAINED, THE ERROR WAS MADE IN POINTING OFF THE DECIMAL AND DID NOT EFFECT THE EXTENSION OF THE ITEM.

"YOU ASKED THAT WE ATTACH ANY WORK PAPERS THAT WE MIGHT HAVE THAT WOULD BEAR OUT THIS ERROR. WE ARE HEREWITH ATTACHING A WORK PAPER WHICH WAS GOTTEN UP FOR THE STENOGRAPHER WHO FILLED IN THE INVITATION TO BID. YOU WILL NOTICE, THE ESTIMATOR MADE A MISTAKE IN PUTTING THE DECIMAL POINT IN THE WRONG PLACE ON THE PRICE FOR ITEM NO. 12. THIS IS VERY EVIDENT, OF COURSE, BECAUSE ITEM NO. 13 WAS OF A SIMILAR PRICE AND AS YOU CAN SEE THE TWO EXTENSIONS WERE VERY CLOSE."

ON THE REFERRED-TO WORK SHEET THE BID FIGURES FOR THE TWO ITEMS WERE AS FOLLOWS:

(CHART OMITTED)

IN HIS UNDATED "REPORT OF CIRCUMSTANCES" THE CONTRACTING OFFICER STATED, IN PERTINENT PART, AS FOLLOWS:

"THERE ARE NO CIRCUMSTANCES OF SUCH NATURE AS TO CAUSE SUSPICION. ALL BIDS IN THE TRANSACTION WERE CERTIFIED AS HAVING BEEN CHECKED AGAINST EXTENSIONS BUT IN THIS CASE IT IS EVIDENT THAT ALLEGED ERROR IN THE PLACEMENT OF THE DECIMAL POINT WAS NOT DISCOVERED BY THE CHECKER.

"IT IS REQUESTED THAT PERMISSION BE GRANTED TO CORRECT THE ABOVE DESCRIBED ERROR BY ISSUING A SUPPLEMENTAL AGREEMENT CHANGING THE UNIT PRICE OF ITEM 12 FROM $0.023958 TO $0.23958. SUCH ACTION IS RECOMMENDED BY REASON OF FACT THAT TOTAL PRICE OF ITEM APPEARS TO INDICATE BIDDER'S INTENTION. FURTHER, WHILE THERE IS NO RECORD AVAILABLE OF A SIMILAR TRANSACTION, THE UNIT PRICE OF $0.23958 HAS BEEN VERIFIED BY COMPETITIVE SOURCES AS JUSTIFIABLE."

ERROR IS APPARENT ON THE FACE OF THE CONTRACT SINCE THE UNIT PRICE SPECIFIED FOR ITEM NO. 12 MULTIPLIED BY 5,000 THE QUANTITY OF BOXES INVOLVED, DOES NOT EQUAL THE AMOUNT INSERTED IN THE TOTAL PRICE COLUMN. ALSO, ITEMS NOS. 12 AND 13 COVER BOXES WHICH APPEAR TO BE IDENTICAL EXCEPT AS TO DIMENSIONS. ON THE BASIS OF THOSE DIMENSIONS, THE SURFACE AREAS OF THE BOXES UNDER THE TWO ITEMS ARE NEARLY THE SAME AND, THEREFORE, QUOTATIONS OF APPROXIMATELY THE SAME AMOUNT NORMALLY WOULD BE EXPECTED THEREON. HOWEVER, THE COMPANY QUOTED $0.23958 EACH ON ITEM NO. 12 AND $0.22775 EACH ON ITEM NO. 13. NO OTHER BID WAS RECEIVED ON ITEM NO. 12 AND THE OTHER BID RECEIVED ON ITEM NO. 13 WAS $0.17470 EACH. UNDER THE CIRCUMSTANCES IT IS APPARENT THAT THE UNIT PRICE QUOTED BY THE COMPANY ON ITEM NO. 12 WAS ERRONEOUS, AS ALLEGED.

ACCORDINGLY, SINCE THE ERROR WAS ALLEGED AND EXPLAINED BY THE ATLANTA PAPER COMPANY PROMPTLY UPON RECEIPT OF THE CONTRACT AND AS THE EVIDENCE LEAVES LITTLE DOUBT THAT THE COMPANY INTENDED TO BID $0.23958 PER BOX ON ITEM NO. 12, THE UNIT PRICE FOR SAID ITEM MAY BE CORRECTED TO $0.23958 WHICH WILL MAKE NO CHANGE IN THE TOTAL PRICE FOR SAID ITEM OR IN THE TOTAL CONTRACT PRICE FOR ALL ITEMS.

A REFERENCE TO THIS DECISION SHOULD BE MADE ON THE CONTRACT.

THE PAPERS, WITH THE EXCEPTION OF THE CONTRACTING OFFICER'S UNDATED "REPORT OF CIRCUMSTANCES," ARE RETURNED HEREWITH.