B-125200, SEP. 21, 1955

B-125200: Sep 21, 1955

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TO THE SECRETARY OF THE ARMY: REFERENCE IS MADE TO A LETTER DATED AUGUST 15. NO EXCEPTIONS TO THE SPECIFICATIONS WERE TAKEN IN THE BID AS SUBMITTED. THE ABSTRACT OF BID SHOWS THAT OTHER BIDS RECEIVED COVERING ALL ITEMS WERE IN THE TOTAL AMOUNTS OF $30. THE COMPANY'S BID PROPOSAL WAS TO EXPIRE IN 30 DAYS FROM DATE OF OPENING AND SINCE NO EVIDENCE TO SUBSTANTIATE A MISTAKE IN BID HAD BEEN RECEIVED. AWARD WAS MADE TO THE COMPANY ON MARCH 25. THE COMPANY CONTENDED THAT THE NOTICE OF AWARD WAS NOT BINDING AND DID NOT CONSTITUTE A CONTRACT AND REQUESTED THAT THE AWARD BE RESCINDED. STATES THAT THE PERCENTAGE OF DIFFERENTIAL IN THE BID PRICES QUOTED IS NOT UNCOMMON IN CURRENT BIDS. THAT THERE WAS NO REASON TO SUSPECT A MISTAKE IN THE BID.

B-125200, SEP. 21, 1955

TO THE SECRETARY OF THE ARMY:

REFERENCE IS MADE TO A LETTER DATED AUGUST 15, 1955, WITH ENCLOSURES, FROM THE ASSISTANT SECRETARY OF THE ARMY (LOGISTICS AND R AND D), REQUESTING A DECISION AS TO THE ACTION TO BE TAKEN WITH RESPECT TO A BID DATED FEBRUARY 21, 1955, SUBMITTED BY THE HENRY PRODUCTS COMPANY, 842 ROCKAWAY AVENUE, BROOKLYN, NEW YORK.

BY INVITATION NO. SC-36-039-55-1271-59, DATED JANUARY 26, 1955, THE SIGNAL CORPS SUPPLY AGENCY, PHILADELPHIS, PENNSYLVANIA, REQUESTED BIDS FOR FURNISHING SPOTLIGHT SETS IN ACCORDANCE WITH SIGNAL CORPS SPECIFICATIONS MIL-S-12610 WITH AMENDMENT NO. 1, TOGETHER WITH TABULAR LISTS OF PARTS, LITERATURE AND SUPPLEMENTS FOR TECHNICAL MANUALS. IN RESPONSE TO THE INVITATION, THE HENRY PRODUCTS COMPANY SUBMITTED A BID OFFERING TO FURNISH ALL ITEMS FOR AN AGGREGATE PRICE OF $28,082, AND NO EXCEPTIONS TO THE SPECIFICATIONS WERE TAKEN IN THE BID AS SUBMITTED. THE ABSTRACT OF BID SHOWS THAT OTHER BIDS RECEIVED COVERING ALL ITEMS WERE IN THE TOTAL AMOUNTS OF $30,216, $36,113.85, $38,563.80, UP TO $83,960. BY LETTER DATED FEBRUARY 25, 1955, THE ENGINEERING OFFICER OF THE AGENCY REQUESTED THE COMPANY TO FURNISH INFORMATION FOR TECHNICAL CLARIFICATION OF ITS BID. THE COMPANY BY LETTER DATED MARCH 7, 1955, ALLEGED THAT IT HAD INTENDED TO FURNISH THE SPOTLIGHT SETS WITH CERTAIN ALTERNATES WHICH WOULD REQUIRE A WAIVER FROM THE STANDARDS SET UP IN SPECIFICATION MIL-S-12610, BUT DID NOT ALLEGE ERROR IN THE PRICES QUOTED IN ITS BID. AFTER INVESTIGATION OF THE MATTER SET FORTH IN THE LETTER OF MARCH 7, 1955, THE CONTRACTING OFFICER SENT A REPLY TO THE COMPANY ON MARCH 22, 1955, INDICATING THAT ITS REQUEST TO DEVIATE FROM THE SPECIFICATIONS COULD NOT BE COMPLIED WITH SINCE FORMAL BIDS COULD NOT BE ALTERED AFTER OPENING. THE COMPANY'S BID PROPOSAL WAS TO EXPIRE IN 30 DAYS FROM DATE OF OPENING AND SINCE NO EVIDENCE TO SUBSTANTIATE A MISTAKE IN BID HAD BEEN RECEIVED, AWARD WAS MADE TO THE COMPANY ON MARCH 25, 1955. BY LETTERS DATED APRIL 6, 1955, AND JUNE 1, 1955, THE COMPANY CONTENDED THAT THE NOTICE OF AWARD WAS NOT BINDING AND DID NOT CONSTITUTE A CONTRACT AND REQUESTED THAT THE AWARD BE RESCINDED. THE CONTRACTING OFFICER IN LETTER DATED JUNE 24, 1955, STATES THAT THE PERCENTAGE OF DIFFERENTIAL IN THE BID PRICES QUOTED IS NOT UNCOMMON IN CURRENT BIDS, AND THAT THERE WAS NO REASON TO SUSPECT A MISTAKE IN THE BID.

IT IS NOT SUFFICIENT IN CASES WHERE BIDS ARE OPENED AND THE AMOUNTS OF ALL BIDS DISCLOSED, THAT THE LOW BIDDER MERELY ALLEGE ERROR IN ITS BID IN ORDER TO BE RELIEVED OF FURNISHING THE SUPPLIES OR MATERIALS ON WHICH IT HAS BID. IN ORDER TO OBTAIN RELIEF THERE SHOULD BE AN IMMEDIATE SUBMISSION OF SUCH PROOF AND EXPLANATION AS TO LEAVE NOROOM FOR DOUBT THAT A BONA FIDE MISTAKE WAS MADE AND HOW IT OCCURRED. THE FACT THAT THE COMPANY'S AGGREGATE BID WAS $2,134 LESS THAN THE NEXT LOW BID RECEIVED IS NOT OF ITSELF SUFFICIENT EVIDENCE THAT A MISTAKE WAS MADE IN THE COMPANY'S QUOTATION. SEE 17 COMP. GEN. 599.

THE RECORD SHOWS THAT AFTER THE ENGINEERING OFFICER REQUESTED AND RECEIVED TECHNICAL CLARIFICATION OF THE BID THE CONTRACTING OFFICER GAVE THE COMPANY AN OPPORTUNITY TO SUBMIT EVIDENCE IN SUPPORT OF THE ALLEGED MISTAKE AND THAT THE COMPANY FAILED OR REFUSED TO SUBMIT SUCH EVIDENCE. IN THE CIRCUMSTANCES, THERE WAS NO FURTHER OBLIGATION ON THE CONTRACTING OFFICER TO PROTECT THE BIDDER'S INTEREST IN THE MATTER AND HE HAD NO OTHER ALTERNATIVE THAN TO AWARD THE CONTRACT TO THE COMPANY. SEE IN THIS CONNECTION SCOTT V. UNITED STATES, 44 C.CLS. 524. THE ACCEPTANCE, AFTER TECHNICAL CLARIFICATION OF THE BID AND THE FAILURE OF THE COMPANY TO SUBSTANTIATE ERROR IN THE BID, WAS IN ENTIRE GOOD FAITH AND CONSUMMATED A VALID AND BINDING CONTRACT WHICH FIXED THE RIGHTS AND LIABILITIES OF THE PARTIES. SEE UNITED STATES V. PURCELL ENVELOPE COMPANY, 249 U.S. 313; AND AMERICAN SMELTING AND REFINING COMPANY V. UNITED STATES, 259 U.S. 75.

ACCORDINGLY, THE FACTS OF RECORD IN THE CASE ARE INSUFFICIENT TO JUSTIFY THE CONCLUSION THAT THE HENRY PRODUCTS COMPANY IN ENTITLED TO BE RELIEVED FROM THE OBLIGATION OF ITS BID AS SUBMITTED.