B-124362, SEP. 27, 1955

B-124362: Sep 27, 1955

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TO THE SECRETARY OF THE ARMY: REFERENCE IS MADE TO YOUR LETTER OF JUNE 17. DA-31-001-AIII-1694 WAS AWARDED. THE SPECIFICATIONS WERE AMENDED IN SEVERAL RESPECTS. ONE OF WHICH WAS TO PROVIDE THAT CERTAIN CABINETS BE CONSTRUCTED OF STAINLESS STEEL INSTEAD OF WOOD. THREE OTHER BIDS WERE RECEIVED IN THE AMOUNTS OF $47. FOSTER WAS REQUESTED TO SUBMIT A STATEMENT IN WRITING SETTING FORTH THE FACTS AS TO HOW THE ERROR WAS MADE AND SUPPORTED BY SUCH EVIDENCE AS WORK SHEETS OR OTHER DATA USED IN PREPARING HIS BID. IT WAS AGREED THAT THE BID OF MR. FOSTER WAS ACCEPTED ON MARCH 28. FOSTER CONFIRMED HIS VERBAL ALLEGATION OF ERROR AND STATED THAT ON THE DATE HE WAS FURNISHED A COPY OF ADDENDUM NO. 1 HE WAS ADVISED BY AN INDIVIDUAL IN THE POST ENGINEER'S OFFICE THAT THE ADDENDUM INVOLVED MECHANICAL PLANS COVERING THE SHEET ON AIR CONDITIONING.

B-124362, SEP. 27, 1955

TO THE SECRETARY OF THE ARMY:

REFERENCE IS MADE TO YOUR LETTER OF JUNE 17, 1955, WITH ENCLOSURES, REQUESTING A DECISION AS TO THE ACTION TO BE TAKEN REGARDING AN ERROR W. A. FOSTER, CONTRACTOR, BURLINGTON, NORTH CAROLINA, ALLEGES HE MADE IN HIS BID ON WHICH CONTRACT NO. DA-31-001-AIII-1694 WAS AWARDED.

BY INVITATION NO. ENG 31-001-55-118, THE PURCHASING AND CONTRACTING DIVISION, FORT BRAGG, NORTH CAROLINA, REQUESTED BIDS--- TO BE OPENED MARCH 17, 1955--- FOR FURNISHING LABOR AND MATERIALS AND PERFORMING ALL WORK REQUIRED FOR ALTERATIONS, MODIFICATIONS, AND ADDITIONS TO OBSTETRICAL WARD TH-28, HOSPITAL NO. 2, FORT BRAGG, NORTH CAROLINA. BY ADDENDUM NO. 1 DATED FEBRUARY 25, 1955, THE SPECIFICATIONS WERE AMENDED IN SEVERAL RESPECTS, ONE OF WHICH WAS TO PROVIDE THAT CERTAIN CABINETS BE CONSTRUCTED OF STAINLESS STEEL INSTEAD OF WOOD. IN RESPONSE, W. A. FOSTER SUBMITTED A BID DATED MARCH 17, 1955, OFFERING TO PERFORM THE WORK FOR THE LUMP SUM OF $37,448. THREE OTHER BIDS WERE RECEIVED IN THE AMOUNTS OF $47,884, $51,584, AND $53,700.

IN AN UNDATED STATEMENT, IN WHICH HE RECOMMENDED AN INCREASE OF $4,072.98 IN THE CONTRACT PRICE OF THE PROJECT, THE CONTRACTING OFFICER STATED THAT ON MARCH 17, 1955--- THE DAY OF THE BID OPENING--- HE INVITED THE ATTENTION OF MR. FOSTER TO THE DIFFERENCE BETWEEN HIS BID ON THE PROJECT AND THE OTHER BIDS; THAT NOT HAVING HIS WORK SHEETS WITH HIM MR. FOSTER DID NOT AT THAT TIME ALLEGE ANY ERROR IN HIS BID; THAT DURING THE FOLLOWING WEEK MR. FOSTER VERBALLY ALLEGED THAT HE HAD ERRONEOUSLY BASED HIS BID ON FURNISHING WOODEN CABINETS RATHER THAN STAINLESS STEEL CABINETS AS REQUIRED; AND THAT MR. FOSTER WAS REQUESTED TO SUBMIT A STATEMENT IN WRITING SETTING FORTH THE FACTS AS TO HOW THE ERROR WAS MADE AND SUPPORTED BY SUCH EVIDENCE AS WORK SHEETS OR OTHER DATA USED IN PREPARING HIS BID. THE CONTRACTING OFFICER STATED FURTHER THAT BECAUSE OF THE URGENCY OF THE WORK, IT WAS AGREED THAT THE BID OF MR. FOSTER WOULD BE ACCEPTED ON THE BASIS OF HIS BID PRICE OF $37,448, WITH THE UNDERSTANDING THAT THE MATTER OF THE ERROR IN THE BID WOULD BE SUBMITTED TO THE GENERAL ACCOUNTING OFFICE FOR CONSIDERATION. THE BID OF MR. FOSTER WAS ACCEPTED ON MARCH 28, 1955.

BY LETTER DATED MAY 12, 1955, MR. FOSTER CONFIRMED HIS VERBAL ALLEGATION OF ERROR AND STATED THAT ON THE DATE HE WAS FURNISHED A COPY OF ADDENDUM NO. 1 HE WAS ADVISED BY AN INDIVIDUAL IN THE POST ENGINEER'S OFFICE THAT THE ADDENDUM INVOLVED MECHANICAL PLANS COVERING THE SHEET ON AIR CONDITIONING, HEATING AND SPRINKLING SYSTEM AND THAT, THEREFORE, HE GAVE THE ADDENDUM TO HIS HEATING AND PLUMBING SUBCONTRACTOR SO THAT HE COULD ADJUST HIS BID PRICE; AND THAT IT WAS NOT UNTIL AFTER HE HAD BEEN AWARDED THE CONTRACT THAT HE LEARNED THAT ADDENDUM NO. 1 HAD CHANGED THE TYPE OF CABINETS FROM WOODEN TO STAINLESS STEEL. MR. FOSTER STATED FURTHER THAT HE HAD RECEIVED SEVERAL QUOTATIONS ON THE STAINLESS STEEL CABINETS, THE LOWEST OF WHICH WAS IN THE AMOUNT OF $3,987.30, AND THAT TO THAT AMOUNT SHOULD BE ADDED CERTAIN AMOUNTS TO COVER INSTALLATION LABOR, OVERHEAD, PROFIT AND BID BOND, MAKING THE TOTAL COST OF THE METAL CABINETS $4,557.66. HE REQUESTED THAT THE TOTAL CONTRACT PRICE OF THE PROJECT BE INCREASED $4,072.98 TO COVER THE DIFFERENCE BETWEEN THE COST OF THE WOODEN CABINETS AND THE COST OF THE STAINLESS STEEL CABINETS, AND SUBMITTED A COST BREAKDOWN OF HIS ORIGINAL BID PRICE AND REVISED BID PRICE, AND HIS ORIGINAL ESTIMATE SHEET, WHICH SHOWS THAT HE ESTIMATED THE ACTUAL MATERIAL AND LABOR COSTS INCIDENT TO THE CABINETS AS BEING $410 AND INCLUDED $484.68 IN HIS BID TO COVER THEM.

COMPARISON OF MR. FOSTER'S BID WITH THE OTHERS RECEIVED SHOWS THAT HIS BID OF $37,448 IS OUT OF LINE WITH THE OTHERS. ALSO, THE RECORD INDICATES THAT THE AMOUNT ORIGINALLY ESTIMATED BY MR. FOSTER AS THE COST OF THE CABINETS IS APPROXIMATELY ONE-TENTH OF THE GOVERNMENT'S ESTIMATE OF $4,500 FOR THE STAINLESS STEEL CABINETS, WHEREAS THE PRICE REQUESTED BY HIM FOR THE LATTER IS SUBSTANTIALLY IDENTICAL WITH THE ESTIMATE.

ON THE BASIS OF THE FACTS AND EVIDENCE OF RECORD, THERE APPEARS LITTLE, IF ANY, DOUBT THAT MR. FOSTER MADE AN ERROR IN HIS BID, AS ALLEGED. ACCORDINGLY, SINCE IT WAS BELIEVED THAT THE BID OF MR. FOSTER WAS ERRONEOUS AND SINCE SUCH BELIEF WAS CONFIRMED PRIOR TO AWARD--- WHICH AWARD WAS SUBJECT TO CORRECTION BY THE GENERAL ACCOUNTING OFFICE -- CONTRACT NO. DA 31-001-AIII-1694 MAY BE AMENDED TO INCREASE THE PRICE FOR THE PROJECT TO $41.520.98, WHICH AMOUNT IS STILL LOWER THAN THE NEXT LOWEST BID ON THE PROJECT, AND PAYMENT IS AUTHORIZED TO BE MADE ON THAT BASIS.

A REFERENCE TO THIS DECISION SHOULD BE MADE ON THE AMENDMENT TO BE ATTACHED TO THE CONTRACT.

THE CONTRACTING OFFICER'S UNDATED STATEMENT AND A COPY OF THE CONTRACTOR'S LETTER OF MAY 12, 1955, TOGETHER WITH HIS WORK SHEETS, ARE BEING RETAINED. THE OTHER PAPERS ARE RETURNED.