B-124048, AUG. 24, 1955

B-124048: Aug 24, 1955

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TO SECRETARY OF THE AIR FORCE: REFERENCE IS MADE TO A LETTER DATED JULY 26. ON WHICH PURCHASE ORDER (30-635) 55-3920 IS BASED. TWO DAYS LATER THE FIRMS SOLICITED WERE REQUESTED TO CONFIRM THEIR QUOTATIONS IN WRITING. THE BID WAS ACCEPTED AS TO ITEMS 3. THE COMPANY ADVISED THAT AN ERROR IN QUOTING ON THE SOLDER HAD BEEN MADE IN THAT THE PRICE QUOTED WAS LESS THAN ITS COST ON MATERIAL. WAS FURNISHED SHOWING THAT THE COST OF ITEMS 3 AND 4 WAS $0.80 AND $0.69 RESPECTIVELY. THE PRIMARY QUESTION INVOLVED IS NOT WHETHER AN ERROR WAS MADE IN THE BID. WHETHER A VALID AND BINDING CONTRACT WAS CONSUMMATED BY THE ACCEPTANCE THEREOF. THE CONTRACTING OFFICER REPORTS THAT HE WAS NOT ON NOTICE OF ERROR PRIOR TO THE ACCEPTANCE OF THE BID.

B-124048, AUG. 24, 1955

TO SECRETARY OF THE AIR FORCE:

REFERENCE IS MADE TO A LETTER DATED JULY 26, 1955, WITH ENCLOSURES, FROM THE ASSISTANT TO DEPUTY FOR PROCUREMENT AND PRODUCTION, FURNISHING THE REPORT WE REQUESTED RELATIVE TO AN ERROR WHICH THE CENTRAL NEW YORK SUPPLY COMPANY, INC., ALLEGES IT MADE IN ITS BID DATED MARCH 11, 1955, ON WHICH PURCHASE ORDER (30-635) 55-3920 IS BASED.

THE GRIFFISS AIR FORCE BASE, ROME, NEW YORK, ON MARCH 9, 1955, SOLICITED BY TELEPHONE QUOTATIONS FOR FURNISHING CERTAIN ITEMS OF PIPE AND SOLDER, AND TWO DAYS LATER THE FIRMS SOLICITED WERE REQUESTED TO CONFIRM THEIR QUOTATIONS IN WRITING. IN RESPONSE THERETO, THE CENTRAL NEW YORK SUPPLY COMPANY SUBMITTED A LETTER DATED MARCH 11, 1955, CONFIRMING THEIR ORAL BID MARCH 9, 1955, FOR FURNISHING SEVERAL ITEMS OF STEEL PIPE AND SOLDER, INCLUDING A PRICE FOR THE SOLDER OF 70 CENTS PER POUND EACH FOR ITEMS 3 AND 4. THE BID WAS ACCEPTED AS TO ITEMS 3, 4, 5, AND 7 ON APRIL 18, 1955.

IN A LETTER DATED MAY 12, 1955, THE COMPANY ADVISED THAT AN ERROR IN QUOTING ON THE SOLDER HAD BEEN MADE IN THAT THE PRICE QUOTED WAS LESS THAN ITS COST ON MATERIAL. A DUPLICATE COPY OF THE BILL RECEIVED FROM THE COMPANY'S SUPPLIER, ALPHA METALS, INC., WAS FURNISHED SHOWING THAT THE COST OF ITEMS 3 AND 4 WAS $0.80 AND $0.69 RESPECTIVELY. THE COMPANY REQUESTS REIMBURSEMENT OF $181.92, REPRESENTING THE DIFFERENCE IN ITS QUOTATION AND THE COST OF MATERIAL. THE ABSTRACT OF BIDS SHOWS THAT THE FOUR OTHER BIDS RECEIVED ON ITEM NO. 3 RANGED FROM $0.89 TO $1.04 AND ON ITEM NO. 4 FROM $0.71 TO $0.82.

THE PRIMARY QUESTION INVOLVED IS NOT WHETHER AN ERROR WAS MADE IN THE BID, BUT WHETHER A VALID AND BINDING CONTRACT WAS CONSUMMATED BY THE ACCEPTANCE THEREOF. THE CONTRACTING OFFICER REPORTS THAT HE WAS NOT ON NOTICE OF ERROR PRIOR TO THE ACCEPTANCE OF THE BID. CERTAINLY THE DIFFERENCE BETWEEN THE PRICES BID BY THE COMPANY ON ITEMS 3 AND 4 AND THE OTHER PRICES BID THEREON ARE NOT SO GREAT AS TO WARRANT THE CONCLUSION THAT THE CONTRACTING OFFICER SHOULD HAVE BEEN ON NOTICE OF THE PROBABILITY OF ERROR IN THE BID OF THE COMPANY. 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; AND AMERICAN SMELTING AND REFINING COMPANY V. UNITED STATES, 259 U.S. 75.

MOREOVER, THE MISTAKE MADE BY THE COMPANY WAS DUE SOLELY TO THE COMPANY'S OWN NEGLIGENCE OR OVERSIGHT AND WAS IN NO MANNER INDUCED BY THE GOVERNMENT. HENCE, SUCH ERROR AS WAS MADE WAS UNILATERAL--- NOT MUTUAL--- AND THEREFORE DOES NOT ENTITLE THE BIDDER TO RELIEF. SEE OGDEN AND DOUGHERTY V. UNITED STATES, 102 C.CLS. 249; AND SALIGMAN ET AL. V. UNITED STATES, 59 F.SUPP. 505, 507.

ACCORDINGLY, THERE IS NO LEGAL BASIS FOR INCREASING THE PRICE FOR ITEMS 3 AND 4 AS REQUESTED BY THE CENTRAL NEW YORK SUPPLY COMPANY, INC., AND, THEREFORE, PAYMENT IN EXCESS OF THE AMOUNTS SPECIFIED IN THE BID FOR SAID ITEMS IS NOT AUTHORIZED.