B-124762, JAN. 23, 1956

B-124762, JAN. 23, 1956

TO THE HONORABLE SECRETARY OF THE ARMY:

REFERENCE IS MADE TO A LETTER DATED DECEMBER 29, 1955, FROM THE OFFICE OF THE CHIEF OF FINANCE, FINEY 167/30 SEP 55, ETC., FURNISHING THE REPORT REQUESTED BY OUR OFFICE WITH RESPECT TO AN ERROR ALLEGED BY DEEMER AND COMPANY, INCORPORATED, TO HAVE BEEN MADE IN ITS BID ON WHICH PURCHASE ORDER NO. 2698-55-SCD, DATED MARCH 24, 1955, WAS ISSUED.

IT APPEARS THAT ON MARCH 14, 1955, DEEMER AND COMPANY, INCORPORATED, QUOTED THE TOBYHANNA SIGNAL DEPOT, BY TELEPHONE, A PRICE OF $0.75 A DOZEN FOR 34 DOZEN BOXES OF ASSORTED CRAYON CHALK. THE QUOTATION, IN ADDITION TO OTHERS, WAS ACCEPTED BY THE DEPOT ON MARCH 24, 1955, BY THE ISSUANCE OF PURCHASE ORDER NO. 2698-55-SCD. LATER DEVELOPMENTS REVEALED THAT DEEMER AND COMPANY, INCORPORATED, QUOTED A PRICE ON, AND SHIPPED TO THE TOBYHANNA SIGNAL DEPOT, A REGULAR WAX-TYPE CRAYON INSTEAD OF THE BLACKBOARD CHALK SPECIFIED. UPON BEING ADVISED THAT THE PART OF THE PURCHASE ORDER PERTAINING TO THE CHALK HAD NOT BEEN PROPERLY FILLED, DEEMER AND COMPANY, INCORPORATED, REQUESTED A PRICE OF $1.65 PER DOZEN BOXES OF THE BLACKBOARD CHALK SPECIFIED. THE CORPORATION THEREFORE REQUESTS THAT THE PURCHASE ORDER BE AMENDED TO REFLECT THE PRICE OF $1.65 PER DOZEN BOXES BEFORE THE REPLACEMENT SHIPMENT IS MADE.

IN CASES COMPRISING FACTS SUCH AS ARE HERE INVOLVED THE CONTROLLING QUESTION IS NOT WHETHER AN ERROR WAS IN FACT MADE IN THE BID BUT RATHER WHETHER GOOD FAITH WAS EXERCISED BY THE PROCUREMENT OFFICER IN THE ACCEPTANCE OF THE QUOTATION. IN THIS CONNECTION, THE ORDERING OFFICER OF THE TOBYHANNA SIGNAL DEPOT ADVISES THAT ALL QUOTATIONS OF DEEMER AND COMPANY, INCORPORATED, ON THE VARIOUS ITEMS INVOLVED WERE EVALUATED FOR REASONABLENESS OF PRICE PRIOR TO THE ISSUANCE OF THE PURCHASE ORDER. THAT OFFICER STATES THAT HE HAD NO REASON TO SUSPECT AN ERROR IN THE QUOTATION SINCE THE SPECIFIC ITEM PURCHASED IN THIS INSTANCE--- ASSORTED CRAYON CHALK--- HAD NOT BEEN PREVIOUSLY PROCURED BY THE DEPOT PURCHASING OFFICE; ALSO, THAT NO OTHER QUOTATIONS WERE AVAILABLE AS A PRICE COMPARISON BASIS SINCE THE PURCHASE INVOLVED LESS THAN $100, THEREBY PRECLUDING THE NECESSITY OF COMPETITION. HENCE, IT REASONABLY MAY NOT BE CONCLUDED THAT THE PROCUREMENT OFFICER WAS, OR SHOULD HAVE BEEN, ON NOTICE OF THE PROBABILITY OF AN ERROR IN THE BID. THE ACCEPTANCE, WITHOUT NOTICE OF ERROR, THEREFORE, CONSUMMATED A VALID CONTRACT CONFERRING RIGHTS AND OBLIGATIONS UPON THE CONTRACTING PARTIES WHICH NEITHER OUR OFFICE NOR ANY OTHER OFFICER OF THE GOVERNMENT IS AUTHORIZED TO VARY TO THE DETRIMENT OF THE UNITED STATES WITHOUT ADEQUATE CONSIDERATION.

ACCORDINGLY, OUR OFFICE FINDS NO LEGAL BASIS FOR RELIEVING DEEMER AND COMPANY, INCORPORATED, FROM FURNISHING THE TYPE OF ASSORTED CRAYON CHALK SPECIFIED IN THE PURCHASE ORDER AT THE PRICE SET FORTH THEREIN.