B-104157, DEC 28, 1951

B-104157: Dec 28, 1951

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PRECIS-UNAVAILABLE THE SECRETARY OF THE AIR FORCE: REFERENCE IS MADE TO A LETTER DATED OCTOBER 24. WHEREIN ERROR IS ALLEGED TO HAVE BEEN MADE IN ITS BID DATED MARCH 26. IS BASED. WERE AWARDED TO THE COMPANY AND PURCHASE ORDER NO. (41-142)-51-19187 DATED APRIL 28. 1951 WAS ISSUED. ADVISED THAT IT MADE AN ERROR IN ITS BID ON ITEM NO. 12 IN THAT ITS QUOTATION OF $309.05 THEREON WAS BASED ON FURNISHING PART NO. WHEREAS THE PART CALLED FOR UNDER SAID ITEM IS NO. ADVISED THE CONTRACTOR THAT HE WAS WITHOUT AUTHORITY TO INCREASE THE CONTRACT PRICE OF ITEM NO. 12. THAT IF THE CONTRACTOR BELIEVED IT WAS ENTITLED TO COMPENSATION IN ADDITION TO THE CONTRACT PRICE FOR FURNISHING THE ITEM IN QUESTION.

B-104157, DEC 28, 1951

PRECIS-UNAVAILABLE

THE SECRETARY OF THE AIR FORCE:

REFERENCE IS MADE TO A LETTER DATED OCTOBER 24, 1951, WITH ENCLOSURES, FROM THE CHIEF, ADJUDICATIONS BRANCH, SETTLEMENTS' DIVISION, DENVER, COLORADO, FURNISHING A REPORT CONCERNING A LETTER DATED MAY 19, 1951, FROM MOTOR TRUCK SALES CO., SAN ANTONIO, TEXAS, WHEREIN ERROR IS ALLEGED TO HAVE BEEN MADE IN ITS BID DATED MARCH 26, 1951, UPON WHICH CONTRACT NO. AF 41(142)-513 DATED APRIL 28, 1951, IS BASED.

THE KELLY AIR FORCE BASE, TEXAS, BY INVITATION DATED MARCH 17, 1951, REQUESTED BIDS TO BE SUBMITTED ON OR BEFORE MARCH 31, 1951, FOR FURNISHING THIRTEEN ITEMS OF SUPPLIES. IN RESPONSE THERETO, MOTOR TRUCK SALES CO. SUBMITTED A BID WHEREIN IT OFFERED TO FURNISH, AMONG OTHER SUPPLIES, ONE REPLACEMENT PART DESCRIBED UNDER ITEM NO. 12 AS "T77-3-12 CASE ASSY- TRANSFER APPL TYPE PL TRUCK TIMKEN DETROIT AXLE OR EQUAL (5108)" FOR $309.05. FIVE ITEMS, INCLUDING ITEM NO. 12, WERE AWARDED TO THE COMPANY AND PURCHASE ORDER NO. (41-142)-51-19187 DATED APRIL 28, 1951 WAS ISSUED. UPON RECEIPT THEREOF, THE CONTRACTOR, BY LETTER OF MAY 2, 1951, ADVISED THAT IT MADE AN ERROR IN ITS BID ON ITEM NO. 12 IN THAT ITS QUOTATION OF $309.05 THEREON WAS BASED ON FURNISHING PART NO. T79-12, WHEREAS THE PART CALLED FOR UNDER SAID ITEM IS NO. T77 3-12 WHICH COULD BE FURNISHED ONLY AT AN ACTUAL COST TO THE CONTRACTOR OF $571.55. THEREFORE, THE CONTRACTOR REQUESTED THAT IT EITHER BE RELEASED FROM OBLIGATION TO FURNISH SAID ITEM OR THAT THE CONTRACT PRICE THEREFOR BE INCREASED TO $571.55.

THE CONTRACTING OFFICER, BY LETTER OF MAY 8, 1951, ADVISED THE CONTRACTOR THAT HE WAS WITHOUT AUTHORITY TO INCREASE THE CONTRACT PRICE OF ITEM NO. 12; THAT THE CONTRACT SHOULD BE PERFORMED IN ACCORDANCE WITH THE TERMS THEREOF; AND THAT IF THE CONTRACTOR BELIEVED IT WAS ENTITLED TO COMPENSATION IN ADDITION TO THE CONTRACT PRICE FOR FURNISHING THE ITEM IN QUESTION, THE PROPER PROCEDURE WOULD BE TO SUBMIT A CLAIM THEREFOR TO THE GENERAL ACCOUNTING OFFICE, CLAIMS DIVISION. IN A LETTER DATED MAY 19, 1951, ADDRESSED TO THE GENERAL ACCOUNTING OFFICE THE CONTRACTOR REITERATED ITS ALLEGATION OF ERROR AND REQUESTED THAT THE RELIEF WHICH WAS DENIED BY THE CONTRACTING OFFICER BE AUTHORIZED. BY LETTER OF SEPTEMBER 12, 1951, THE CONTRACTOR SUBMITTED IN SUBSTANTIATION OF ITS ALLEGATION OF ERROR (A) MEMORANDA WRITTEN IN LONG HAND ON CARDS - PURPORTEDLY OF QUOTATIONS RECEIVED IN JANUARY 1951, FROM ITS SUPPLIER - AS EVIDENCE OF COST TO THE CONTRACTOR OF TIMKEN PARTS NO. T79-12 AND NO. T77-3-12; AND (B) THE RETAINED COPY OF ITS BID WITH CERTAIN FIGURES ENTERED THEREON IN PENCIL, PURPORTEDLY TO INDICATE THAT ITS BID PRICE ON ITEM NO. 12 WAS PREPARED ON THE BASIS OF THE COST OF PART NO. T79-12.

THE BASIC QUESTION HERE FOR DETERMINATION IS NOT WHETHER THE CONTRACTOR MADE A MISTAKE IN ITS BID, BUT WHETHER A VALID AND BINDING CONTRACT WAS CONSUMMATED BY ACCEPTANCE THEREOF. IN 1ST INDORSEMENT DATED AUGUST 28, 1951, FROM THE COMMANDING GENERAL, KELLY AIR FORCE BASE, IT IS STATED -

"2. IT IS REQUESTED IN THE BASIC COMMUNICATION THAT THE CLAIM BE EXPEDITIOUSLY PROCESSED. INASMUCH AS ALL OF THE DATA, CORRESPONDENCE, DOCUMENTS AND A STATEMENT OF THE CONTRACTING OFFICER MUST BE PREPARED, COMPILED AND FURNISHED BY YOUR COMMAND, IT IS BELIEVED THAT THE INTERESTS OF HIGHER AUTHORITY WILL BE BEST AND MOST EXPEDITIOUSLY SERVED BY YOUR FORWARDING, BY INDORSEMENT, THE REQUESTED REPORTS AND DOCUMENTS TO COMMANDING OFFICER, AIR FORCE FINANCE CENTER, DENVER, COLORADO, MARKED ATTENTION: SETTLEMENTS DIVISION, THUS SAVING THE TIME THAT WOULD BE REQUIRED FOR THE RETRANSMISSION OF THEM FROM THIS HEADQUARTERS."

THE ABSTRACT OF BIDS SHOWS THAT THE ONLY OTHER BID ON ITEM NO. 12 WAS $440.50. ORDINARILY, NO FAIR COMPARISON WITH OTHER BIDS CAN BE MADE WHERE ONLY TWO VARIANT BIDS ARE RECEIVED, THERE BEING NO MORE REASON FOR CONSIDERING THE LOW BID TOO LOW THAN FOR CONSIDERING THAT A MISTAKE WAS MADE BY THE HIGH BIDDER IN QUOTING A PRICE TOO HIGH. SEE 20 COMP. GEN. 286. HENCE, THERE BEING NO ERROR APPARENT ON THE FACE OF THE BID, IT DOES NOT APPEAR THAT THE CONTRACTING OFFICER NECESSARILY SHOULD HAVE BEEN ON NOTICE OF THE PROBABILITY OF ERROR IN THE COMPANY'S BID ON ITEM NO. 12. ALTHOUGH, AFTER AWARD, THE COMPANY FURNISHED CERTAIN INFORMATION IN SUBSTANTIATION OF THE ALLEGED ERROR, IT DOES NOT APPEAR THAT, PRIOR TO AWARD, THE CONTRACTING OFFICER WAS AWARE OF HOW THE COMPANY COMPUTED ITS BID. SO FAR AS THE PRESENT RECORD SHOWS, THE ACCEPTANCE OF THE BID WAS IN GOOD FAITH, NO ERROR HAVING BEEN ALLEGED UNTIL AFTER AWARD. THE ACCEPTANCE OF THE BID, UNDER THE CIRCUMSTANCES INVOLVED, CONSUMMATED A VALID AND BINDING CONTRACT WHICH FIXED THE RIGHTS AND LIABILITIES OF THE PARTIES. SEE UNITED STATES V. PURCELL ENVELOPE COMPANY, 249 U.S. 313; AMERICAN SMELTING AND REFINING COMPANY V. UNITED STATES, 259 U.S. 75.

MOREOVER, THE INVITATION WAS CLEAR AND UNAMBIGUOUS AND LEFT NO ROOM FOR DOUBT THAT NO. T77-3-12 CASE ASSEMBLY WAS REQUIRED. THE RESPONSIBILITY FOR THE PREPARATION OF THE BID SUBMITTED IN RESPONSE THERETO WAS UPON THE BIDDER. SEE FRAZIER-DAVIS CONSTRUCTION COMPANY V. UNITED STATES, 100 C. CLS. 120, 163. IF THE CONTRACTOR QUOTED ON A CASE ASSEMBLY OTHER THAN THAT SPECIFIED, SUCH ERROR WAS DUE SOLELY TO THE LACK OF PROPER CARE ON THE PART OF THE CONTRACTOR AND NOT TO ANY FAILURE OF THE GOVERNMENT TO FURNISH SUFFICIENT INFORMATION AS TO THE EXACT TYPE OF CASE ASSEMBLY REQUIRED. SEE GRYMES V. SANDERS, ET AL. 93 U.S. 55, 61, WHEREIN THE SUPREME COURT OF THE UNITED STATES SAID -

"MISTAKE, TO BE AVAILABLE IN EQUITY, MUST NOT HAVE ARISEN FROM NEGLIGENCE, WHERE THE MEANS OF KNOWLEDGE WERE EASILY ACCESSIBLE. THE PARTY COMPLAINING MUST HAVE EXERCISED AT LEAST THE DEGREE OF DILIGENCE 'WHICH MAY BE FAIRLY EXPECTED FROM A REASONABLE PERSON.'"

ANY ERROR THAT WAS MADE IN THE BID WAS UNILATERAL - NOT MUTUAL - AND, THEREFORE, DOES NOT ENTITLE THE COMPANY TO RELIEF. SEE SALIGMAN, ET AL. V. UNITED STATES, 56 F. SUPP. 505, 507; AND OGDEN & DOUGHERTY V. UNITED STATES, 102 C. CLS. 249, 259.

ACCORDINGLY, I FIND NO LEGAL BASIS FOR RELEASING THE CONTRACTOR FROM OBLIGATION TO FURNISH ITEM NO. 12 AT THE PRICE SPECIFIED IN CONTRACT NO. AF 41(142)-513.