B-124127, JULY 27, 1955, 35 COMP. GEN. 50

B-124127, JULY 27, 1955, 35 COMP. GEN. 50

CONTRACTS - OFFER AND ACCEPTANCE - ACCEPTANCE DELAYS NEITHER THE NOTATION OF ACCEPTANCE WRITTEN BY THE CONTRACTING OFFICER ON A SURPLUS PROPERTY BID WHICH REQUIRED ACCEPTANCE WITHIN THIRTY DAYS AFTER THE OPENING, NOR THE FORMAL NOTIFICATION OF AWARD MAILED AFTER EXPIRATION OF THE THIRTY-DAY LIMITATION, CONSUMMATED A VALID CONTRACT AND, THEREFORE, THE BID DEPOSIT SHOULD BE REFUNDED.

TO THE SECRETARY OF THE ARMY, JULY 27, 1955:

REFERENCE IS MADE TO YOUR LETTER OF MAY 27, 1955, WITH ENCLOSURES, WHEREIN YOU REQUEST A DECISION AS TO THE PROPRIETY OF GRANTING THE REQUEST OF JAMES SHAINFINE, PHILADELPHIA, PENNSYLVANIA, THAT HE BE RELIEVED FROM THE CONSEQUENCES OF A MISTAKE ALLEGED TO HAVE BEEN MADE IN HIS PROPOSAL WHICH RESULTED IN CONTRACT NO. DA/S/-23-072-ORD-1-224 1, DATED OCTOBER 26, 1954.

BY INVITATION NO. 23-072-S-55-2-224-1, DATED SEPTEMBER 14, 1954, THE ST. LOUIS ORDNANCE DISTRICT, U.S. ARMY, SOLICITED QUOTATIONS ON 34 ITEMS OF MISCELLANEOUS SUPPLIES WHICH HAD BEEN DECLARED EXCESS UNDER ANOTHER ARMY CONTRACT. THE PROPERTY OF THE SALE WAS LOCATED AT HOUSTON, TEXAS, AND THE BIDDERS WERE URGED TO INSPECT THE ITEMS AT ANY TIME DURING THE PERIOD SEPTEMBER 20 THROUGH OCTOBER 4, 1954, PRIOR TO SUBMITTING PROPOSALS THEREON. OCTOBER 5, 1954, WAS THE DATE SCHEDULED FOR THE FORMAL OPENING OF THE BIDS. AS EVIDENCE OF GOOD FAITH UPON THE PART OF THE BIDDERS, THERE WAS REQUIRED A DEPOSIT EQUIVALENT TO 20 PERCENT OF THE TOTAL AMOUNT OF EACH BID.

IN RESPONSE TO THE INVITATION REFERRED TO, MR. SHAINFINE SUBMITTED HIS PROPOSAL DATED OCTOBER 2, 1954, WHEREIN HE OFFERED--- SUBJECT TO THE CONDITION THAT HIS BID BE ACCEPTED WITHIN 30 CALENDAR DAYS AFTER OPENING ON OCTOBER 5, 1954--- TO PURCHASE ITEMS NOS. 2, 29 AND 30 OF THE INVITATION AT THE LOT AND UNIT PRICES QUOTED, AMOUNTING, IN THE AGGREGATE, TO $289.32. HIS PROPOSAL WAS ACCOMPANIED BY A BID DEPOSIT OF $50, AS REQUIRED BY THE TERMS OF THE INVITATION.

IT APPEARS FROM THE RECORD THAT THE VARIOUS BIDS WERE ABSTRACTED AND THE AWARDS UNDER THE INVITATION APPROVED ON OCTOBER 15, 1954, BY THE ARMY'S LOCAL PROPERTY DISPOSAL REVIEW BOARD. THE DATE OF ACCEPTANCE OF MR. SHINFINE'S BID IS SHOWN ON THE FACE THEREOF AS OCTOBER 26, 1954. APPEARS, HOWEVER, THAT AN AMENDED SALES SUMMARY WAS SUBMITTED TO AND APPROVED BY THE BOARD ON NOVEMBER 5, 1954, AFTER WHICH, ON NOVEMBER 15, COPIES OF THE AWARDED SALES CONTRACTS AND THE FORMAL NOTIFICATION OF THE AWARDS WERE MAILED TO THE SUCCESSFUL BIDDERS. THIS, OF COURSE, WAS 11 DAYS AFTER EXPIRATION OF NOVEMBER 4, 1954, OF MR. SHAINFINE'S OFFER.

BY LETTER DATED NOVEMBER 19, 1954, MR. JAMES SHAINFINE (LISTED IN THE BID AS L. SHAINFINE) ADVISED THE ST. LOUIS ORDNANCE DISTRICT THAT, THROUGH ERROR, HE HAD QUOTED $101.76 ON LOT NO. 2, CONSISTING OF 22 FIVE-GALLON CANS OF OIL, OF AN ALLEGED VALUE OF BETWEEN $10 AND $15, WHEREAS HE HAD INTENDED TO QUOTE ON THE MISCELLANEOUS LOTS OF TAPE DESCRIBED OPPOSITE ITEM NO. 1 OF THE INVITATION. HE REQUESTED, THEREFORE, THAT HIS PROPOSAL EITHER BE CORRECTED TO CONFORM TO HIS ALLEGED INTENTION IN THE MATTER, OR THAT HIS BID ON LOT NO. 2 BE DISREGARDED. THIS REQUEST WAS DENIED IN ADMINISTRATIVE LETTER DATED NOVEMBER 24, 1954. MR. SHAINFINE THEREUPON REFUSED TO TAKE DELIVERY ON THIS ITEM, AND ALSO REFUSED TO PERFORM WITH RESPECT TO ITEMS NOS. 29 AND 30. AS JUSTIFICATION FOR THIS LATTER ACTION, THE BIDDER CONTENDS THAT HE SPECIFICALLY QUOTED ON ITEMS NOS. 29 AND 30 ON A UNIT PRICE BASIS, SINCE THEY WERE REPRESENTED IN THE ADVERTISEMENT AS CONSISTING OF FOUR 220-POUND REELS AND TWO 250-POUND REELS, RESPECTIVELY OF KAISER ALUMINUM FOIL, TOTALING 1,380 POUNDS, WHEREAS THE GOVERNMENT ACTUALLY HAD AVAILABLE FOR DELIVERY UNDER THESE ITEMS QUANTITIES APPROXIMATING ONLY 220 AND 250 POUNDS EACH.

IRRESPECTIVE OF THE MERITS OF THE BIDDER'S CONTENTIONS IN THIS MATTER, IT IS APPARENT FROM THE FACTS AS HEREINABOVE RELATED THAT MR. SHAINFINE'S PROPOSAL OF OCTOBER 2, 1954, WAS NOT ACCEPTED BY THE GOVERNMENT WITHIN THE 30-DAY LIMITATION PERIOD THEREIN SPECIFIED, COMPUTED FROM DATE OF OPENING ON OCTOBER 5, 1954. IN THIS CONNECTION, IT SHOULD BE NOTED THAT THE BIDDER'S OFFER, BY ITS TERMS, AUTOMATICALLY EXPIRED ON NOVEMBER 4, 1954, AND ANY ATTEMPT UPON THE PART OF THE GOVERNMENT THEREAFTER TO REVIVE IT, WITHOUT THE BIDDER'S ACQUIESCENCE OR CONSENT, WAS INEFFECTUAL. SEE WATERMAN V. BANKS, 144 U.S. 402; 16 COMP. GEN. 699; 14 ID. 612.

AS TO WHAT CONSTITUTES A VALID ACCEPTANCE IN SITUATIONS OF THIS CHARACTER, THE LAW IS WELL SETTLED THAT THE MERE ACT OF WRITING A LETTER OF ACCEPTANCE, OR THE NOTING OF AN AWARD ON THE FACE OF THE BIDDER'S PROPOSAL, AS APPARENTLY WAS DONE HERE, DOES NOT CONSTITUTE AN AWARD, NOR IS IT A COMPLETE ACCEPTANCE OF AN OTHERWISE PROPER OFFER. SEE JULIUS AND GERTRUDE STEBEL V. UNITED STATES, 108 C.1CLS. 35, 44. IN ORDER TO EFFECTUATE A COMPLETE ACCEPTANCE OF AN OFFER, AND THUS CREATE A BINDING CONTRACT, THE NOTICE OF THE AWARD, OR THE LETTER OF ACCEPTANCE, EITHER MUST HAVE BEEN MAILED, OR OTHERWISE COMMUNICATED TO THE OFFEROR. SEE BURTON V. UNITED STATES, 202 U.S. 344, 384-385; PATRICK V. BOWMAN 149 ID. 411, 424, BARNEBEY V. BARRON G. COLLIER, INC., 65 F.2D864, 868-869; SHUBERT THEATRICAL COMPANY V. RATH, 271 F.827; CF. RHODE ISLAND TOOL COMPANY V. UNITED STATES, C.1CLS. NO. 49913, DECIDED FEBRUARY 8, 1955. TO PERMIT A CONTRACTING OFFICER MERELY TO NOTE AN ACCEPTANCE ON THE FACE OF A PROPOSAL WOULD WORK A MANIFEST INJUSTICE UPON THE BIDDER, IN THAT IT WOULD ALLOW THE FORMER THE ADVANTAGE OF WITHDRAWING HIS ACCEPTANCE AT ANY TIME PRIOR TO THE ACTUAL MAILING OF THE AWARD AND, WITHIN THE SAID OFFICER'S DISCRETION, OBLIGATE THE BIDDER TO PERFORM OVER AN INDEFINITE PERIOD OF TIME.

THEREFORE, IN THE CIRCUMSTANCES HERE PREVAILING, IT MUST BE CONCLUDED AS A MATTER OF LAW THAT THE PURPORTED ACCEPTANCE ON OCTOBER 26, 1954, OF MR. SHAINFINE'S PROPOSAL WAS INEFFECTUAL FOR PURPOSES OF CONSUMMATING A VALID CONTRACT, AND THAT THE PURPORTED AWARD MADE ON NOVEMBER 15, 1954, ALSO FAILED TO CONSUMMATE A BINDING CONTRACT SINCE THE NOTICE THEREOF WAS MAILED TO THE BIDDER AFTER HIS OFFER HAD EXPIRED. ACCORDINGLY, THE DEPOSIT OF $50 WHICH ACCOMPANIED THE BIDDER'S PROPOSAL OF OCTOBER 2, 1954, MAY BE REFUNDED TO HIM.