B-124683, SEP. 9, 1955

B-124683: Sep 9, 1955

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VETERANS ADMINISTRATION: REFERENCE IS MADE TO A LETTER DATED AUGUST 19. WAS BASED. BIDS WERE REQUESTED FOR FURNISHING 1. TWO OTHER BIDS WERE RECEIVED. UPON NOTING THAT THE LOW BID WAS OUT OF LINE WITH THE OTHER BIDS RECEIVED. THAT THE REQUEST FOR CONFIRMATION WAS NOT QUITE CLEAR AND STATED FURTHER. WE TRUST THIS INFORMATION WILL CLEAR UP THE MATTER * UPON RECEIPT OF THIS LETTER THE CONTRACTING OFFICER AWARDED THE CONTRACT TO THE COMPANY. UPON REQUESTING AND RECEIVING A CONFIRMATION OF THE LOW BID THE CONTRACTING OFFICER IS UNDER NO FURTHER OBLIGATION TO PROTECT THE BIDDER AND THERE REMAINS NO COURSE FOR HIM TO FOLLOW OTHER THAN TO AWARD THE CONTRACT TO THE LOW QUALIFIED BIDDER. IT IS REPORTED THAT.

B-124683, SEP. 9, 1955

TO HONORABLE H. V. HIGLEY, ADMINISTRATOR, VETERANS ADMINISTRATION:

REFERENCE IS MADE TO A LETTER DATED AUGUST 19, 1955, FROM THE DIRECTOR, POLICY AND PLANNING SERVICE, FURNISHING A REPORT REQUESTED IN OUR LETTER OF JULY 28, 1955, RELATIVE TO AN ALLEGED ERROR IN THE BID OF THE F. A. RITTER COMPANY ON WHICH CONTRACT NO. V1005P-2940 DATED JULY 5, 1955, WAS BASED.

BY INVITATION NO. A-520-H, BIDS WERE REQUESTED FOR FURNISHING 1,488 PACKAGES OF SUSPENSORIES TO THE DESTINATIONS SPECIFIED. THE SPECIFICATIONS PROVIDED THAT EACH PACKAGE SHOULD CONTAIN TWELVE SUSPENSORIES. IN RESPONSE TO THE INVITATION, THE F. A. RITTER COMPANY QUOTED A PRICE OF $1 FOR EACH PACKAGE. TWO OTHER BIDS WERE RECEIVED, ONE OF WHICH RANGED FROM $3.57 TO $4.01 AND THE OTHER FROM $3.80 TO $4.33 PER PACKAGE. UPON NOTING THAT THE LOW BID WAS OUT OF LINE WITH THE OTHER BIDS RECEIVED, THE CONTRACTING OFFICER REQUESTED THE COMPANY TO CONFIRM ITS UNIT BID PRICE AND, IF ERROR BE ALLEGED, FURNISH EVIDENCE IN SUBSTANTIATION OF THE ERROR. THE COMPANY ADVISED BY LETTER OF JUNE 2, 1955, THAT THE REQUEST FOR CONFIRMATION WAS NOT QUITE CLEAR AND STATED FURTHER, IN PERTINENT PART, AS FOLLOWS:

"* * * WHEN WE SENT IN OUR QUOTATION, WE QUOTED $1.00 EACH FOR THE SUSPENSORY, SAMPLE ENCLOSED HEREWITH. PLEASE RETURN IT AFTER IT HAS SERVED ITS PURPOSE. WE TRUST THIS INFORMATION WILL CLEAR UP THE MATTER *

UPON RECEIPT OF THIS LETTER THE CONTRACTING OFFICER AWARDED THE CONTRACT TO THE COMPANY. THEREAFTER, THE COMPANY ALLEGED THAT, BY ITS BID, IT INTENDED TO FURNISH A TOTAL OF ONLY 1,488 SUSPENSORIES AT $1 EACH. THE COMPANY HAS FURNISHED ITS WORKSHEET, BREAKDOWN OF ITS INTENDED BID PRICE, SWORN STATEMENT AND PUBLISHED PRICE LISTS, AND CATALOG WHICH CLEARLY ESTABLISH THAT IT BID AS ALLEGED.

ORDINARILY, UPON REQUESTING AND RECEIVING A CONFIRMATION OF THE LOW BID THE CONTRACTING OFFICER IS UNDER NO FURTHER OBLIGATION TO PROTECT THE BIDDER AND THERE REMAINS NO COURSE FOR HIM TO FOLLOW OTHER THAN TO AWARD THE CONTRACT TO THE LOW QUALIFIED BIDDER. AFTER THE FOREGOING EXCHANGE OF COMMUNICATIONS, HOWEVER, IT WOULD APPEAR THAT THE CONTRACTING OFFICER HAD AS MUCH, OR MORE, REASON THAN BEFORE TO BELIEVE THAT THE COMPANY HAD MADE AN ERROR IN ITS BID--- NOT AS TO ITS UNIT PRICE, BUT AS TO THE UNIT. FACT, IT IS REPORTED THAT, ALTHOUGH THE CONTRACTING OFFICER CONSIDERED THE BIDDER'S USE OF THE WORD "EACH" IN ITS LETTER OF JUNE 2, 1955, HE DECIDED THAT IF THE WORD WAS INTERPRETED AS MEANING A SINGLE SUSPENSORY, THE PRICE OF $12 PER PACKAGE WOULD BE SO FAR OUT OF LINE WITH THE OTHER BIDS AS TO RENDER SUCH INTERPRETATION IMPOSSIBLE.

WHILE THE COMPANY'S ALLEGED INTENDED BID WAS OUT OF LINE WITH THE OTHER BIDS, UNDOUBTEDLY THE OTHER BIDS WERE BASED ON FURNISHING 17,856 SUSPENSORIES, AS REQUIRED, WHEREAS THE COMPANY'S BID WAS BASED ON FURNISHING ONE-TWELFTH OF THAT QUANTITY AND IT MAY BE THAT THE ARTICLE IT PROPOSED TO FURNISH WAS OF SUPERIOR QUALITY TO THAT OFFERED BY THE OTHER BIDDERS. IN VIEW OF THE FOREGOING, THE CONCLUSION IS WARRANTED THAT, WHILE THE BIDDER MADE AN ERROR DUE TO A LACK OF CARE ON ITS PART, THE CONTRACTING OFFICER SHOULD HAVE REALIZED AT THE TIME THE BID WAS ACCEPTED THAT A BIDDER INTENTIONALLY WOULD NOT OFFER TO FURNISH, F.O.B. THE SPECIFIED DESTINATION, SUSPENSORIES OF THE TYPE HERE REQUIRED AT $0.08 1/3 EACH. ALSO, AFTER RECEIVING THE BIDDER'S ANSWER TO THE REQUEST FOR BID VERIFICATION THERE APPEARS TO HAVE BEEN AMPLE REASON FOR A FURTHER APPROPRIATE EFFORT TO OBTAIN ADDITIONAL INFORMATION FROM THE COMPANY TO CLARIFY ITS INTENTION PRIOR TO AWARD.

ACCORDINGLY, SINCE ADVICE HAS BEEN RECEIVED INFORMALLY FROM THE DIRECTOR, POLICY AND PLANNING SERVICE, THAT THERE HASBEEN NO DELIVERY OF THE SUSPENSORIES, THE AWARD SHOULD BE CANCELLED.

THE PAPERS FORWARDED WITH THE LETTER OF AUGUST 19, 1955, ARE RETURNED, AS REQUESTED.