B-123000, JAN. 24, 1956

B-123000: Jan 24, 1956

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TO GROSSE POINTE ACCESSORY CORP.: REFERENCE IS MADE TO YOUR LETTER OF JANUARY 3. WHEREIN THE SECRETARY OF THE ARMY WAS INFORMED THAT THERE WAS NO LEGAL BASIS FOR MODIFYING THE PRICE SPECIFIED IN CONTRACT NO. WITH YOUR LETTER THERE WAS ENCLOSED A PHOTOSTATIC COPY OF A LETTER DATED JULY 5. IT IS EVIDENT FROM THE LETTER THAT HE RESOLVED ANY DOUBTS HE HAD IN THE MATTER UPON ASCERTAINING THAT YOU HAD HAD PREVIOUS EXPERIENCE IN MANUFACTURING THE SAME ARTICLES. HIS PRIMARY CONCERN APPEARS TO HAVE BEEN AS TO YOUR ABILITY TO PERFORM. AT THE TIME AWARD WAS MADE THERE WAS NO ERROR APPARENT ON THE FACE OF YOUR BID. YOU WERE ADMITTEDLY UNAWARE OF IT YOURSELF. - AND IT CANNOT BE SAID THAT THE AMOUNT OF YOUR BID WAS SO OUT OF LINE WITH THE OTHER BIDS RECEIVED AS TO CONSTITUTE CONSTRUCTIVE NOTICE THAT IT WAS PROBABLY ERRONEOUS.

B-123000, JAN. 24, 1956

TO GROSSE POINTE ACCESSORY CORP.:

REFERENCE IS MADE TO YOUR LETTER OF JANUARY 3, 1956, RELATIVE TO DECISION DATED MAY 13, 1955, B-123000, WHEREIN THE SECRETARY OF THE ARMY WAS INFORMED THAT THERE WAS NO LEGAL BASIS FOR MODIFYING THE PRICE SPECIFIED IN CONTRACT NO. DA-30-352-TAF-1792 DATED MAY 20, 1953.

WITH YOUR LETTER THERE WAS ENCLOSED A PHOTOSTATIC COPY OF A LETTER DATED JULY 5, 1955, FROM THE ORIGINAL CONTRACTING OFFICER, WHICH YOU ALLEGE SHOWS THAT THE CONTRACTING OFFICER DID CONSIDER THE BID TOO LOW AND THAT HE DOUBTED THAT THE CONTRACT COULD BE MADE AT THE PRICE BID.

WHILE THE ORIGINAL CONTRACTING OFFICER STATES IN HIS LETTER THAT HE HAD SEVERAL REASONABLE DOUBTS AS TO YOUR ABILITY TO MAKE THE MATTRESS COVERS AT THE PRICE QUOTED, IT IS EVIDENT FROM THE LETTER THAT HE RESOLVED ANY DOUBTS HE HAD IN THE MATTER UPON ASCERTAINING THAT YOU HAD HAD PREVIOUS EXPERIENCE IN MANUFACTURING THE SAME ARTICLES, AND HIS PRIMARY CONCERN APPEARS TO HAVE BEEN AS TO YOUR ABILITY TO PERFORM. AT THE TIME AWARD WAS MADE THERE WAS NO ERROR APPARENT ON THE FACE OF YOUR BID--- IN FACT, YOU WERE ADMITTEDLY UNAWARE OF IT YOURSELF--- AND IT CANNOT BE SAID THAT THE AMOUNT OF YOUR BID WAS SO OUT OF LINE WITH THE OTHER BIDS RECEIVED AS TO CONSTITUTE CONSTRUCTIVE NOTICE THAT IT WAS PROBABLY ERRONEOUS, SOME OF THE OTHER PRICES HAVING BEEN $2.54, $2.61, $2.64, $2.765, AND $2.96 F.O.B. ORIGIN.

WITH RESPECT TO YOUR CONTENTION THAT YOU ADVISED THE SUCCESSOR CONTRACTING OFFICER OF THE ERROR ON MARCH 19, 1954 RATHER THAN APRIL 14, 1954, SUCH FACT WOULD HAVE NO MATERIAL BEARING IN THIS CASE, SINCE EVEN IF MARCH 19, 1954, WAS CONSIDERED THE DATE ON WHICH YOU ALLEGED ERROR, THE FACT REMAINS THAT NO ERROR WAS ALLEGED UNTIL MORE THAN NINE MONTHS AFTER AWARD.

YOUR LETTER AND THE ORIGINAL CONTRACTING OFFICER'S LETTER HAVE BEEN CAREFULLY CONSIDERED BUT THEY FURNISH NO ADDITIONAL INFORMATION THAT WOULD JUSTIFY OR WARRANT ANY CHANGE IN THE CONCLUSION REACHED IN OUR DECISION OF MAY 13, 1955.

WE HAVE NO LEGAL AUTHORITY TO RELIEVE CONTRACTORS MERELY BECAUSE THEY MAY HAVE SUSTAINED LOSSES ON GOVERNMENT CONTRACTS. THE ONLY BASIS FOR RELIEF ON ACCOUNT OF A MISTAKE IN BID IS THAT AT THE TIME OF ACCEPTING THE BID THE GOVERNMENT REPRESENTATIVE WAS ON NOTICE, EITHER ACTUAL OR CONSTRUCTIVE, OF SUCH FACTS THAT HIS ACCEPTANCE OF THE BID COULD ONLY BE REGARDED AS A VIRTUAL FRAUD. GENERALLY THE FACT THAT A BID IS TOO LOW IS NOT SUFFICIENT, UNLESS IT IS OBVIOUSLY SO LOW THAT IT IS "TOO GOOD TO BE TRUE," OR THE BIDDER CAN SHOW, BEFORE AWARD IS MADE, THAT IT IS NOT IN FACT WHAT HE INTENDED TO BID. WE CANNOT CONSIDER THE FACTS IN THIS CASE TO BE ADEQUATE TO MEET THESE REQUIREMENTS.