B-125442, OCT. 3, 1955

B-125442: Oct 3, 1955

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TO THE HONORABLE SECRETARY OF THE ARMY: REFERENCE IS MADE TO A LETTER DATED SEPTEMBER 6. DA 42-015-QM-3482 WAS AWARDED. THE BID OF THE COMPANY WAS THE LOWEST OF THE TWO RESPONSIVE BIDS SUBMITTED AND AWARD OF CONTRACT NO. DA 42-015 QM-3482 WAS MADE ON MARCH 10. TWO OTHER BIDS RECEIVED WERE DETERMINED TO BE UNRESPONSIVE AS THEY SPECIFIED DELIVERY OF PACKAGES CONTAINING ONLY 150 SHEETS AT A PRICE PER PACKAGE OF $0.13 AND $0.1332 RESPECTIVELY. THE ONLY EXPLANATION THE CONTRACTOR COULD MAKE FOR THE ALLEGED ERROR WAS THAT THE FEDERAL SPECIFICATIONS CALLED FOR PACKING EITHER 250/15 OR 150/25. IT IS REPORTED THAT ALTHOUGH FEDERAL STANDARD NO. 7. IT WAS NOT A PART OF THE LATEST FEDERAL SPECIFICATION OR INVITATION FOR BIDS IN THIS CASE.

B-125442, OCT. 3, 1955

TO THE HONORABLE SECRETARY OF THE ARMY:

REFERENCE IS MADE TO A LETTER DATED SEPTEMBER 6, 1955, WITH ENCLOSURES, FROM THE ASSISTANT SECRETARY OF THE ARMY (LOGISTICS AND R AND D), REQUESTING A DECISION AS TO THE ACTION THAT SHOULD BE TAKEN REGARDING AN ERROR THE A. P. W. PRODUCTS COMPANY, NEW YORK, NEW YORK, ALLEGES IT MADE IN ITS BID ON WHICH CONTRACT NO. DA 42-015-QM-3482 WAS AWARDED.

BY INVITATION NO. QM-42-015-55-53, THE UTAH GENERAL DEPOT, OGDEN, UTAH, REQUESTED BIDS FOR FURNISHING 12,515 PACKAGES OF SINGLE FOLD PAPER TOWELS, MINIMUM DIMENSIONS 100 SQUARE INCHES AREA, 9 3/4 INCHES WIDE, COMPRISING 250 SHEETS TO THE PACKAGE, F.O.B. POST QUARTERMASTER, FORT LEWIS, WASHINGTON, IN RESPONSE TO THE INVITATION THE A. P. W. PRODUCTS COMPANY SUBMITTED A BID DATED FEBRUARY 28, 1955, OFFERING TO FURNISH THE TOWELS AT A UNIT PRICE OF $0.165 PER PACKAGE AND A TOTAL CONTRACT PRICE OF $2,064.98. THE BID OF THE COMPANY WAS THE LOWEST OF THE TWO RESPONSIVE BIDS SUBMITTED AND AWARD OF CONTRACT NO. DA 42-015 QM-3482 WAS MADE ON MARCH 10, 1955. TWO OTHER BIDS RECEIVED WERE DETERMINED TO BE UNRESPONSIVE AS THEY SPECIFIED DELIVERY OF PACKAGES CONTAINING ONLY 150 SHEETS AT A PRICE PER PACKAGE OF $0.13 AND $0.1332 RESPECTIVELY. THE OTHER RESPONSIVE BID OFFERED A UNIT PRICE OF $0.286 PER PACKAGE.

IN A LETTER DATED MARCH 17, 1955, THE A. P. W. PRODUCTS COMPANY ACKNOWLEDGED RECEIPT OF THE CONTRACT BUT ALLEGED A MISTAKE IN ITS BID IN THAT IT COMPUTED ITS BID ON THE BASIS OF 125 TOWELS TO THE PACKAGE AND 25 PACKAGES TO THE CARTON RATHER THAN 250 TOWELS TO THE PACKAGE AND 15 PACKAGES TO THE CARTON. BY LETTER DATED MAY 31, 1955, THE CONTRACTOR CALLED ATTENTION TO THE FACT THAT THE PACKING REFERRED TO IN ITS LETTER OF MARCH 17, SHOULD READ 150 TOWELS TO THE PACKAGE AND 25 PACKAGES TO THE CARTON. THE ONLY EXPLANATION THE CONTRACTOR COULD MAKE FOR THE ALLEGED ERROR WAS THAT THE FEDERAL SPECIFICATIONS CALLED FOR PACKING EITHER 250/15 OR 150/25. IT IS REPORTED THAT ALTHOUGH FEDERAL STANDARD NO. 7, DATED AUGUST 21, 1953, PERMITS PACKAGING 250/15 OR 150/25, IT WAS NOT A PART OF THE LATEST FEDERAL SPECIFICATION OR INVITATION FOR BIDS IN THIS CASE. IS THE OPINION OF THE CONTRACTING OFFICER THAT IN VIEW OF ALL THE CIRCUMSTANCES THE CONTRACTOR MADE AN HONEST MISTAKE IN NOT NOTICING THE PACKAGING REQUIREMENTS OF THE INVITATION AND IN PREDICATING ITS BID ON ITS UNDERSTANDING OF THE PACKAGING REQUIREMENTS OF FEDERAL SPECIFICATIONS.

ORDINARILY NO FAIR COMPARISON CAN BE MADE WHERE ONLY TWO WIDELY VARIANT BIDS ARE RECEIVED, THERE BEING NO MORE REASON FOR CONSIDERING THE LOW BID TOO LOW THAN FOR CONSIDERING THAT A MISTAKE WAS MADE BY THE HIGH BIDDER IN QUOTING A PRICE TOO HIGH. THERE IS ANOTHER FACTOR IN THE PRESENT CASE, HOWEVER, WHICH IS OF IMPORTANCE. THE BID OF THE A. P. W. PRODUCTS COMPANY IN THE AMOUNT OF $0.165 FOR A PACKAGE OF 250 TOWELS IS SLIGHTLY MORE THAN THE PRICES QUOTED BY THE TWO NONRESPONSIVE BIDDERS ($0.13 AND $0.1318) FOR FURNISHING A PACKAGE OF 150 TOWELS ONLY-- THE SIZE OF THE PACKAGE ON WHICH THE COMPANY ALLEGES ITS BID PRICE OF $0.165 WAS BASED. IN VIEW THEREOF, AND HAVING PARTICULAR REGARD FOR THE FACT THAT THE NONRESPONSIVE BIDDERS WERE CLOSER TO THE F.O.B. DESTINATION POINT, IT APPEARS THAT THE CONTRACTING OFFICER SHOULD HAVE BEEN ON NOTICE OF ERROR IN THE BID; HENCE, THE BID OF THE COMPANY SHOULD NOT HAVE BEEN ACCEPTED WITHOUT REQUESTING IT TO VERIFY ITS BID.

SINCE THERE IS NO ROOM FOR DOUBT THAT THE COMPANY MADE AN ERROR IN ITS BID AS ALLEGED, THE AWARD MAY BE CANCELED.

A DUPLICATE SET OF PAPERS IN THE CASE IS BEING RETAINED. THE OTHER PAPERS ARE RETURNED.