B-106542, JUN 10, 1952

B-106542: Jun 10, 1952

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PRECIS-UNAVAILABLE THE SECRETARY OF THE AIR FORCE: REFERENCE IS MADE TO A REPORT DATED APRIL 16. WHEREIN ERROR IS ALLEGED TO HAVE BEEN MADE ON ITEM NO. 418-3 OF ITS UNDATED BID UPON WHICH CONTRACT NO. WAS BASED. SAID ITEM AND NINE OTHERS WERE AWARDED TO THE AFORE NAMED BIDDER. DELIVERY OF ITEM NO. 418-3 WAS EFFECTED BUT UPON RECEIPT THEREOF. THE WASHERS WERE FOUND TO BE THE INTERNAL TEETH STYLE. THE CONTRACTOR WAS ADVISED OF ITS FAILURE TO COMPLY WITH CONTRACT REQUIREMENTS AS TO SAID ITEM. WASHERS OF THE REQUIRED TYPE WERE FURNISHED AND ACCEPTED. A REQUEST OF THE CONTRACTOR FOR AN INCREASE IN THE CONTRACT PRICE THEREFOR FROM $5.94 TO $31.90 WAS DENIED BY THE CONTRACTING OFFICER IN A LETTER OF OCTOBER 23.

B-106542, JUN 10, 1952

PRECIS-UNAVAILABLE

THE SECRETARY OF THE AIR FORCE:

REFERENCE IS MADE TO A REPORT DATED APRIL 16, 1952, FURNISHED BY THE OFFICE OF DIRECTOR OF FINANCE CONCERNING A LETTER DATED OCTOBER 30, 1951, FROM METALS SUPPLY COMPANY, INC., SALT LAKE CITY, UTAH, WHEREIN ERROR IS ALLEGED TO HAVE BEEN MADE ON ITEM NO. 418-3 OF ITS UNDATED BID UPON WHICH CONTRACT NO. AF 42(600)-640 DATED AUGUST 6, 1951, WAS BASED.

THE AIR FORCE CONTRACTING OFFICE, HILL AIR FORCE BASE, UTAH, BY INVITATION NO. 29-412,18,21, DATED JULY 19, 1951, REQUESTED BIDS FOR FURNISHING VARIOUS ITEMS OF HARDWARE SUPPLIES. IN RESPONSE THERETO, METALS SUPPLY COMPANY, INC., SUBMITTED A BID IN WHICH IT OFFERED TO FURNISH, AMONG OTHER ITEMS, 1000 TENSION STEEL SPRING TYPE WASHERS OF SPECIFIED SIZE, "SHAKEPROOF, OR EQUAL," AT $5.94 PER THOUSAND, ITEM NO. 418-3. SAID ITEM AND NINE OTHERS WERE AWARDED TO THE AFORE NAMED BIDDER.

DELIVERY OF ITEM NO. 418-3 WAS EFFECTED BUT UPON RECEIPT THEREOF, THE WASHERS WERE FOUND TO BE THE INTERNAL TEETH STYLE, NOT THE SPRING TENSION STEEL TYPE AND, THEREFORE, BY LETTER DATED AUGUST 31, 1951, THE CONTRACTOR WAS ADVISED OF ITS FAILURE TO COMPLY WITH CONTRACT REQUIREMENTS AS TO SAID ITEM. THE CORPORATION BY LETTER OF SEPTEMBER 24, 1951, ALLEGED ERROR IN QUOTING A PRICE ON, AND DELIVERING THE INCORRECT TYPE OF WASHERS. SUBSEQUENTLY, WASHERS OF THE REQUIRED TYPE WERE FURNISHED AND ACCEPTED, AND A REQUEST OF THE CONTRACTOR FOR AN INCREASE IN THE CONTRACT PRICE THEREFOR FROM $5.94 TO $31.90 WAS DENIED BY THE CONTRACTING OFFICER IN A LETTER OF OCTOBER 23, 1951. HOWEVER, THE CONTRACTOR WAS ADVISED THEREIN THAT IF IT BELIEVED THAT IT WAS ENTITLED THERETO, A CLAIM FOR THE DIFFERENCE BETWEEN THE CONTRACT PRICE AND THE ALLEGED CORRECT PRICE OF THE MATERIAL FURNISHED COULD BE FILED WITH THE GENERAL ACCOUNTING OFFICE.

BY LETTER OF OCTOBER 30, 1951, THE CONTRACTOR REQUESTED THE GENERAL ACCOUNTING OFFICE TO AUTHORIZE A CHANGE ORDER TO BE ISSUED INCREASING THE CONTRACT PRICE ON ITEM NO. 418-3 TO $31.90. IN SUPPORT THEREOF, AND OF ITS ALLEGATION OF ERROR IN ITS BID AS TO SAID ITEM, THE CONTRACTOR BY LETTER OF DECEMBER 28, 1951, FORWARDED A COPY OF AN INVOICE DATED OCTOBER 30, 1951, STATED TO HAVE BEEN RECEIVED FROM ITS SUPPLIER, SHAKEPROOF INC., CHICAGO, ILLINOIS, COVERING 1000 WASHERS AT $6.90 PER THOUSAND, PLUS A SET UP CHARGE OF $25, OR $31.90, LESS A 10 PER CENT TRADE DISCOUNT.

THE BASIC QUESTION FOR DETERMINATION IS NOT WHETHER THE CONTRACTOR MADE A MISTAKE IN ITS BID ON ITEM NO. 418-3, BUT WHETHER A VALID AND BINDING CONTRACT WAS CONSUMMATED BY THE ACCEPTANCE THEREOF. IN A REPORT OF THE FACTS DATED APRIL 7, 1952, THE CONTRACTING OFFICER STATED THAT NEITHER HE NOR ANY OF THE PROCUREMENT OFFICE PERSONNEL INVOLVED NOTICED AN ERROR IN THE BID OF METALS SUPPLY COMPANY ON ITEM NO. 418-3, NOR WAS THERE ANY REASON TO SUSPECT ERROR, INASMUCH AS THE QUOTATION SEEMED REASONABLE AND COMPARED FAVORABLY WITH THAT SHOWN IN THE PRICE SECTION OF THE U.S.A.F. SUPPLY CATALOG. ALSO, HE STATED THAT THE SAID BIDDER'S QUOTATION ON ITEM NO. 418-3 WAS BASED ON FURNISHING A QUANTITY OF 1000 WHICH WAS OFFERED IN LIEU OF THE 200 ORIGINALLY STATED TO BE REQUIRED IN THE INVITATION, AND THAT SUCH FACT WAS INDICATIVE OF THE BIDDER'S ABILITY TO FURNISH A GREATER QUANTITY AT A MORE REASONABLE PRICE THAN THE SMALLER QUANTITY ORIGINALLY REQUESTED.

NO ERROR WAS APPARENT ON THE FACE OF THE BID AND SINCE THE BID WAS THE ONLY ONE RECEIVED ON ITEM NO. 418-3, A COMPARISON WITH OTHER BIDS WAS NOT POSSIBLE; HENCE, THERE WAS NOTHING TO PLACE THE CONTRACTING OFFICER ON NOTICE OF THE PROBABILITY OF ERROR IN THE BID. ALTHOUGH, AFTER AWARD, THE CORPORATION FURNISHED EVIDENCE IN SUPPORT OF ITS ALLEGATION THAT THE PRICE QUOTED WAS MISTAKENLY BASED ON THE INCORRECT ARTICLE, IT DOES NOT APPEAR THAT, PRIOR TO AWARD, THE CONTRACTING OFFICER WAS AWARE THAT THE BID ON SAID ITEM WAS NOT INTENDED FOR THE WASHERS SPECIFIED THEREIN. THUS, 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 THERETO. SEE UNITED STATES V. PURCELL ENVELOPE COMPANY, 249 U.S. 313; AND 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 AS TO THE TYPE OF WASHER THAT 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, AS STATED IN ITS LETTER OF DECEMBER 28, 1951, THE CONTRACTOR SUBMITTED ITS BID ON THE BASIS OF FURNISHING AN ARTICLE OTHER THAN THAT SPECIFIED UNDER ITEM NO. 418-3, SUCH MISTAKE WAS DUE SOLELY TO LACK OF PROPER CARE ON THE PART OF THE CONTRACTOR AND NOT TO ANY FAILURE ON THE PART OF THE GOVERNMENT TO FURNISH SUFFICIENT INFORMATION WITH RESPECT TO THE TYPE OF WASHER REQUIRED. SEE GRYMES V. SANDERS ET AL., 93 U.S. 55, 61. IT IS EVIDENT THAT ANY ERROR THAT WAS MADE IN THE BID WAS UNILATERAL - NOT MUTUAL - AND, THEREFORE, DOES NOT ENTITLE THE CONTRACTOR TO RELIEF. SEE OGDEN & DOUGHERTY V. UNITED STATES, 102 C. CLS. 249, 259; AND SALIGMAN ET AL. V. UNITED STATES, 56 F. SUPP. 505, 507.

ON THE BASIS OF THE FACTS OF RECORD, THERE APPEARS NO LEGAL BASIS FOR AUTHORIZING ANY INCREASE IN THE CONTRACT PRICE OF THE WASHERS.