B-124605, AUG. 1, 1955

B-124605: Aug 1, 1955

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TO SECRETARY OF THE ARMY: REFERENCE IS MADE TO A LETTER DATED JULY 6. THE BID WAS ACCEPTED AND BECAME THE BASIS OF CONTRACT NO. THE LAST COLUMN OF SCHEDULE M IS HEADED "PRICE PER MFBM FOB AS SHOWN ABOVE * " AND INCLUDES THE STATEMENT "/ALL FREIGHT CHARGES INCLUDING THE TRANSPORTATION TAX SHALL BE PAID BY THE NTRACTOR).'. THE OTHER BIDS RECEIVED ON SCHEDULE M WERE IN THE AMOUNTS OF $80 AND $94.90 PER MBF (WITH A DISCOUNT OF 1 PER CENT. - THE PACIFIC FIR SALES' BID WAS ACCEPTED AS THE LOWEST BID. THE ERROR WAS ALLEGED TO HAVE RESULTED FROM THE FACT THAT IN THE ABSENCE OF THE PERSON WHO USUALLY PREPARED BIDS THE BID WAS SUBMITTED BY AN EMPLOYEE UNFAMILIAR WITH THE INVITATION FORMS AND WITH THE PREPARATION OF BIDS.

B-124605, AUG. 1, 1955

TO SECRETARY OF THE ARMY:

REFERENCE IS MADE TO A LETTER DATED JULY 6, 1955, FROM THE ASSISTANT SECRETARY (LOGISTICS AND R AND D), WITH ENCLOSURES, REQUESTING A DECISION AS TO THE ACTION TO BE TAKEN WITH RESPECT TO AN ERROR ALLEGED BY PACIFIC FIR SALES IN ITS BID FOR FURNISHING LUMBER SUBMITTED IN RESPONSE TO INVITATION FOR BIDS NO. ENG-35-026-55-161 ISSUED BY THE DISTRICT ENGINEER, PORTLAND DISTRICT, UNDER DATE OF APRIL 21, 1955. THE BID WAS ACCEPTED AND BECAME THE BASIS OF CONTRACT NO. DA-35-026-ENG-24508, DATED MAY 5, 1955.

THE INVITATION REQUESTED BIDS ON LUMBER DESCRIBED THEREIN, INCLUDING SCHEDULE M WHICH COVERED ITEM 3, 15,000 FBM OF LUMBER FOR DELIVERY AT MARE ISLAND NAVAL SHIPYARD ON OR BEFORE JUNE 27, 1955,

CHART

" * FOB CAR AND/OR TRUCKS, DESTINATION: -------------------

(NAME AND ADDRESS OF

SUPPLYING MILL OR

YARD).'

THE LAST COLUMN OF SCHEDULE M IS HEADED "PRICE PER MFBM FOB AS SHOWN ABOVE * " AND INCLUDES THE STATEMENT "/ALL FREIGHT CHARGES INCLUDING THE TRANSPORTATION TAX SHALL BE PAID BY THE NTRACTOR).'

PACIFIC FIR SALES SUBMITTED ITS BID WITH THE FIGURE "$65.00" INSERTED IN THE PRICE COLUMN, AND WITH THE NAME "D AND M LUMBER COMPANY, ARCATA, CALIF.' INSERTED IN THE BLANK IN THE ABOVE-QUOTED LINE. THE BIDDER ALSO INSERTED THE WORDS "ARCATA, CALIF.' IN A BLANK IN A LINE IN SCHEDULE N, IMMEDIATELY BELOW SCHEDULE M ON THE SAME PAGE, MAKING THAT LINE READ: "FOB CAR, MILL: ARCATA, CALIF., " ALTHOUGH SUBMITTING NO BID ON SCHEDULE N.

THE OTHER BIDS RECEIVED ON SCHEDULE M WERE IN THE AMOUNTS OF $80 AND $94.90 PER MBF (WITH A DISCOUNT OF 1 PER CENT--- 20 DAYS, MAKING NET BIDS OF $79.20 AND $93.95). ON MAY 5, 1955--- TWO DAYS AFTER THE OPENING OF BIDS--- THE PACIFIC FIR SALES' BID WAS ACCEPTED AS THE LOWEST BID. ON MAY 9, BY TELEPHONE AND LETTER, THE BIDDER ALLEGED ERROR IN ITS BID IN THAT TRANSPORTATION CHARGES HAD NOT BEEN INCLUDED, THE PRICE QUOTED HAVING BEEN INTENDED ON AN FOB MILL BASIS. THE ERROR WAS ALLEGED TO HAVE RESULTED FROM THE FACT THAT IN THE ABSENCE OF THE PERSON WHO USUALLY PREPARED BIDS THE BID WAS SUBMITTED BY AN EMPLOYEE UNFAMILIAR WITH THE INVITATION FORMS AND WITH THE PREPARATION OF BIDS.

PACIFIC FIR SALES HAS REQUESTED THAT THE CONTRACT BE CANCELED OR THAT AN ADDITIONAL PAYMENT OF $13.73 PER MFBM BY MADE TO COVER TRANSPORTATION COSTS TO MARE ISLAND NAVAL SHIPYARD, THEREBY INCREASING THE CONTRACT PRICE TO $78.73 PER MFBM, LESS THE DISCOUNT OFFERED OF 2 PER CENT--- TWENTY DAYS. IT IS REPORTED THAT $13.73 PER MFBM IS SUBSTANTIALLY CORRECT AS TRANSPORTATION COSTS FROM ARCATA, CALIFORNIA, TO MARE ISLAND NAVAL SHIPYARD. IF THAT AMOUNT IS ADDED TO THE CONTRACT PRICE THE PRICE WOULD STILL BE BELOW THE NEXT LOW BID.

IN VIEW OF THE FACTS AS SHOWN BY THE FILE, IT MAY BE REGARDED AS SATISFACTORILY ESTABLISHED THAT PACIFIC FIR SALES MADE AN ERROR IN ITS BID, INTENDING TO BID ON THE BASIS OF DELIVERY FOB ARCATA, CALIFORNIA. ALSO, BECAUSE OF THE DISPARITY BETWEEN ITS BID AND THE OTHER BIDS RECEIVED AND BECAUSE OF THE FACT THAT IT HAD INDICATED ON THE SAME PAGE THAT IT CONTEMPLATED DELIVERY FOB CARS AT ARCATA, CALIFORNIA, THE CONTRACTING OFFICER SHOULD HAVE REQUESTED VERIFICATION BEFORE MAKING THE AWARD. ACCORDINGLY, THE CONTRACT MAY BE MODIFIED SO AS TO PERMIT PAYMENT OF AN ADDITIONAL AMOUNT OF $13.73 PER MFBM TO COVER TRANSPORTATION COSTS. REFERENCE TO THIS DECISION SHOULD ACCOMPANY THE CONTRACT.

ATTENTION IS INVITED TO THE FACT THAT THE FORM OF SCHEDULE USED IN THE SUBJECT INVITATION APPEARS TO LACK CLARITY AND SEEMS CONDUCIVE TO ERROR IN THAT THE VARIOUS ITEMS TO BE BID ON ARE NOT CLEARLY SEPARATED, AND PARTICULARLY IN THAT THE BLANKS PROVIDED FOR THE "NAME AND ADDRESS OF SUPPLYING MILL OR YARD" ARE PLACED WHERE THE FOB POINT WOULD BE EXPECTED TO APPEAR, WHERE DESTINATION DELIVERY IS SPECIFIED, THE COLON AFTER THE WORD "DESTINATION" BEING CLEARLY MISLEADING. IT IS SUGGESTED THAT CONSIDERATION BE GIVEN TO IMPROVING THE FORMS ACCORDINGLY.

THE PAPERS ARE RETURNED HEREWITH, WITH THE EXCEPTION OF ONE COPY EACH OF THE CONTRACTOR'S ACCEPTED BID, LETTER DATED MAY 9, 1955, AND THE CONTRACTING OFFICER'S FINDINGS AND RECOMMENDATION.