B-125548, NOVEMBER 4, 1955, 35 COMP. GEN. 272

B-125548: Nov 4, 1955

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BIDS - ACCEPTANCE - OBSCURITY OF LANGUAGE - OFFER AND ACCEPTANCE AN ACCEPTANCE OF A BID WHICH DOES NOT EXPLICITLY STATE THE ALTERNATIVES WHICH HAVE BEEN ACCEPTED. CREATES A BINDING CONTRACT IN SPITE OF THE OBSCURITY OF THE TERMS OF THE ACCEPTANCE AS LONG AS THE ACCEPTANCE IS POSITIVE AND UNAMBIGUOUS AND DOES NOT CHANGE. REGARDLESS OF THE TIME OF DAY THE BIDS ARE REQUIRED TO BE OPENED. A LETTER WITHDRAWING A BID IS NOT EFFECTIVE UNTIL RECEIVED BY THE OFFEREE WHEREAS A LETTER OF ACCEPTANCE. WHEN WRITTEN ACCEPTANCE IS REQUIRED. IS EFFECTIVE WHEN MAILED AND. A BINDING CONTRACT IS EFFECTED WHERE THE ACCEPTANCE IS MAILED BEFORE THE WITHDRAWAL IS RECEIVED EVEN THOUGH THE WITHDRAWAL WAS MAILED PRIOR TO THE ACCEPTANCE.

B-125548, NOVEMBER 4, 1955, 35 COMP. GEN. 272

BIDS - ACCEPTANCE - OBSCURITY OF LANGUAGE - OFFER AND ACCEPTANCE AN ACCEPTANCE OF A BID WHICH DOES NOT EXPLICITLY STATE THE ALTERNATIVES WHICH HAVE BEEN ACCEPTED, BUT WHICH PROVIDES SUFFICIENT INFORMATION TO DETERMINE THEM MATHEMATICALLY, CREATES A BINDING CONTRACT IN SPITE OF THE OBSCURITY OF THE TERMS OF THE ACCEPTANCE AS LONG AS THE ACCEPTANCE IS POSITIVE AND UNAMBIGUOUS AND DOES NOT CHANGE, ADD TO, OR QUALIFY THE TERMS OF THE OFFER. A BID SUBMITTED IN RESPONSE TO AN INVITATION WHICH REQUIRES THAT BIDS BE ACCEPTED WITHIN 30 CALENDAR DAYS AFTER THE DATE OF OPENING MAY BE ACCEPTED AT ANY TIME UP TO MIDNIGHT OF THE THIRTIETH DAY, REGARDLESS OF THE TIME OF DAY THE BIDS ARE REQUIRED TO BE OPENED. A LETTER WITHDRAWING A BID IS NOT EFFECTIVE UNTIL RECEIVED BY THE OFFEREE WHEREAS A LETTER OF ACCEPTANCE, WHEN WRITTEN ACCEPTANCE IS REQUIRED, IS EFFECTIVE WHEN MAILED AND, THEREFORE, A BINDING CONTRACT IS EFFECTED WHERE THE ACCEPTANCE IS MAILED BEFORE THE WITHDRAWAL IS RECEIVED EVEN THOUGH THE WITHDRAWAL WAS MAILED PRIOR TO THE ACCEPTANCE.

TO THE SECRETARY OF THE INTERIOR, NOVEMBER 4, 1955:

A LETTER FROM THE ADMINISTRATIVE ASSISTANT SECRETARY, DEPARTMENT OF THE INTERIOR, DATED SEPTEMBER 20, 1955, REQUESTS A DECISION AS TO THE PROPER DISPOSITION OF A BID FOR CONSTRUCTION OF CERTAIN STREET AND WATER AND SEWER SYSTEMS IMPROVEMENTS IN PETERSBURG, ALASKA, DESIGNATED AS PROJECT 50 -A-19.

INVITATIONS TO BID WERE ISSUED UNDER DATE OF MARCH 11, 1955. BIDS WERE TO BE RECEIVED UNTIL 0:00 A.M., APRIL 27, 1955. THE PROJECT WAS DIVIDED INTO 18 DIFFERENT PARTS. OF THESE, TEN PROVIDED FOR SEPARATE BIDS BASED ON THE USE OF ALTERNATIVE MATERIALS: NINE FOR NEW SEWER CONSTRUCTION USING VITREOUS CLAY, CONCRETE, AND CEMENT ASBESTOS SEWER PIPE, AND ONE INVOLVING QUOTATIONS DEPENDING ON THE USE OF WOOD STAVE, CAST IRON AND CEMENT ASBESTOS WATER PIPES.

THE BIDDER IN QUESTION, MR. SAM BERGESEN, AGREED IN HIS BID "UPON A WRITTEN ACCEPTANCE OF THIS BID, MAILED, OR OTHERWISE FURNISHED" WITHIN 30 CALENDAR DAYS "AFTER THE DATE OF OPENING OF BIDS" TO EXECUTE A FORMAL CONTRACT AND GIVE PERFORMANCE AND PAYMENT BONDS.

THE BIDS WERE OPENED AT 10:00 A.M. ON APRIL 27, 1955, AND THE DECISION WAS MADE TO AWARD A CONTRACT TO MR. BERGESEN. ON MAY 27, 1955, AT 1:33 P.M., THE FOLLOWING RADIO MESSAGE TO MR. BERGESEN WAS DISPATCHED FROM JUNEAU, ALASKA, VIA THE ALASKA COMMUNICATION SYSTEM, AND WAS TELEPHONED TO MR. BERGESEN FROM TACOMA, WASHINGTON, AT 3:07 P.M. OF THE SAME DAY:

IN ACCORDANCE WITH YOUR BID OF APRIL 27, 1955 CMA YOU ARE HEREBY AWARDED THE CONTRACT FOR THE CONSTRUCTION OF THE STREETCMA SEWER AND WATER IMPROVEMENTS CMA PROJECT FIFTY DASH A DASH NINETEEN CMA PETERSBURG CMA ALASKA IN THE AMOUNT OF FOUR HUNDRED TWENTY THREE THOUSAND FOUR HUNDRED TWENTY EIGHT DOLLARS AND NINE CENTS PD THIS AMOUNT IS FOR BASE BID PART ONE CMA BASE BID PART TWO CMA BASE BID PART THREE AND ALTERNATES D CMA E CMA H CMA J CMA K CMA M CAM N AND D DASH TWO PD PLEASE FURNISH ONE HUNDRED PERCENT PERFORMANCE AND PAYMENT BONDS WITH POWER OF ATTORNEY FOR THE PARTY EXECUTING THE BONDS FOR THE SURETY COMPANY PD DATE BONDS AND POWER OF ATTORNEY MAY 27, 1955 PD PLEASE ADVISE DATE YOU PLAN TO COMMENCE WORK UNDER THIS PROJECT PD

ON MAY 27, A COPY OF THE MESSAGE WAS MAILED TO MR. BERGESEN FROM JUNEAU AND WAS RECEIVED BY HIM ON MAY 31.

ELEVEN PARTS OF THE PROJECT WERE AWARDED TO MR. BERGESEN. ON SIX OF THESE PARTS BIDS HAD BEEN SUBMITTED COVERING THE USE OF EACH OF THREE TYPES OF PIPES. HOWEVER, AS SHOWN ABOVE, THE RADIO MESSAGE TO MR. BERGESEN DID NOT STATE WHICH OF THE TYPES OF PIPE WAS CONTEMPLATED BY THE AWARD IN EACH CASE.

THE BIDDER CONTENDS THAT NO CONTRACT RESULTED BECAUSE (1) THE BID (OFFER) WAS NOT ACCEPTED WITHIN THE 30-DAY PERIOD PERMITTED, AND (2) THAT THE ACCEPTANCE MESSAGE WAS NOT SUFFICIENTLY PRECISE AS TO THE ITEMS TO BE COVERED BY THE CONTRACT TO RESULT IN THE REQUIRED MEETING OF THE MINDS.

THE BID FORM USED IN THE INSTANCE ( STANDARD FORM 21) REQUIRED "WRITTEN ACCEPTANCE OF THIS BID, MAILED OR OTHERWISE FURNISHED," WITHIN 30 CALENDAR DAYS "AFTER THE DATE OF OPENING OF BIDS.' ( ITALICS SUPPLIED.) THE CLOSING DATE FOR BIDS WAS APRIL 27 AND THE BIDS WERE OPENED ON THAT DATE. THEREFORE, THE BID COULD PROPERLY BE ACCEPTED ANY TIME WITHIN 30 DAYS AFTER APRIL 27, OR UP TO MIDNIGHT OF MAY 27, NOTWITHSTANDING THAT THE BIDS WERE OPENED AT 10:00 A.M. ON APRIL 27. 19 COMP. GEN. 139.

WE HAVE BEEN INFORMALLY ADVISED THAT IT IS ESTABLISHED THAT THE MESSAGE OF ACCEPTANCE WAS MAILED TO THE BIDDER FROM JUNEAU, ALASKA, BEFORE MIDNIGHT OF MAY 27. BY THE SPECIFIC PROVISIONS OF STANDARD FORM 21, CITED ABOVE, THE WRITTEN ACCEPTANCE WAS REQUIRED TO BE MAILED WITHIN 30 DAYS AFTER THE DATE OF OPENING OF BIDS. ADDITIONALLY, THE GENERAL RULE IS THAT, WHERE AN ACCEPTANCE BY MAIL IS AUTHORIZED, THE ACCEPTANCE, UNLESS OTHERWISE SPECIFIED, IS EFFECTIVE FROM THE TIME IT IS MAILED. BURTON V. UNITED STATES, 202 U.S. 344; PATRICK V. BOWMAN, 149 U.S. 411; TAYLOR V. MERCHANTS' FIRE INSURANCE CO; 9 HOW. 390; WERTHEIMER V. WEHLE-HARTFORD CO., 9 A 2D 279; B-4888, AUGUST 1, 1939; B 104768, SEPTEMBER 5, 1951; B- 124250, JULY 14, 1955. IT MUST BE HELD, THEREFORE, THAT EVEN THOUGH THE BIDDER DID NOT RECEIVE A WRITTEN COPY OF THE ACCEPTANCE UNTIL MAY 31, 1955, THE BID WAS ACCEPTED WITHIN THE TIME PROVIDED.

AN ACCEPTANCE, TO BIND THE OFFEROR, MUST BE POSITIVE AND UNAMBIGUOUS. WILLISTON CONTRACTS 207. THERE IS, HOWEVER, NO SPECIAL REQUIREMENT AS TO LUCIDITY. THUS, AN ACCEPTANCE WHICH IS POSITIVE AND UNAMBIGUOUS AND DOES NOT CHANGE, ADD TO, OR QUALIFY THE TERMS OF THE OFFER, RESULTS IN A BINDING CONTRACT EVEN THOUGH THE LANGUAGE OF THE ACCEPTANCE MAY BE OBSCURE.' IF THE AGREEMENT EXPRESSES THE SUBJECT MATTER OF EXCHANGE IN SUCH A WAY THAT IT CAN BE IDENTIFIED OR DEFINITELY DETERMINED BY THE COURT, IT IS ENOUGH FOR ENFORCEMENT.' 1 CORBIN CONTRACTS 316.

THE LANGUAGE OF THE ACCEPTANCE HERE INVOLVED CLEARLY AND UNEQUIVOCALLY ACCEPTS AN OFFER. THE WORDS,"YOU ARE HEREBY AWARDED THE CONTRACT," PERMIT NO OTHER INTERPRETATION. THE ONLY POSSIBLE AMBIGUITY ARISES OUT OF THE FAILURE TO STATE, IN THE CASE OF SIX PARTS OF THE PROJECT, WHICH OF THE BIDS REPRESENTING ALTERNATIVE MATERIALS HAD BEEN ACCEPTED. THE TOTAL DOLLAR VALUE OF THE AWARD WAS PROPERLY STATED IN THE ACCEPTANCE AS $423,428.09. THE FIVE PARTS WHICH DID NOT PROVIDE FOR ALTERNATIVE BIDS REPRESENTING ALTERNATIVE MATERIALS ACCOUNTED FOR $301,418.18, LEAVING $122,009.91 TO BE ACCOUNTED FOR BY THE SIX VARIABLE ITEMS WHICH ARE AS FOLLOWS:

TABLE

SAM BERGESEN'S BIDS

SEWER PIPES

VARIABLES, PARTS VITREOUS CONCRETE CEMENT

CLAY ASBESTOS BASIC BID, PART I ------------ $37,508.17 $40,519.70 $37,274.48 ALTERNATE D ------------------ 4,514.34 4,731.39 4,388.38 ALTERNATE M ------------------ 4,516.50 4,833.90 4,464.75 ALTERNATE N ---- -------------- 9,048.00 9,887.04 8,920.32 ALTERNATE D-2 ----------------- 4,304.52 4,665.16 4,257.48

SUBTOTAL ------------------ 59,891.53 64,637.19 59,305.41

WATER PIPES

WOOD IRON ASBESTOS BASIC BID, PART III --- ------ $74,044.80 $89,337.00 $62,704.50

GRAND TOTAL --------------- --------- --------- 122,009.91

IT SHOULD BE NOTED THAT THE CORRECT TOTAL MAY BE ARRIVED AT BY TAKING THE LOWEST FIGURE IN EACH CASE. THERE ARE 729 POSSIBLE VARIATIONS OF THE SIX PARTS, BUT ONLY ONE WILL ADD TO THE CORRECT TOTAL. ANY OTHER COMBINATION WILL RESULT IN A TOTAL AT LEAST $47.04 TOO HIGH. THE ACCEPTANCE CAN THUS BE INTERPRETED IN ONLY ONE WAY AND, THEREFORE, CANNOT BE SAID TO BE AMBIGUOUS.

IT MIGHT WELL BE CONSIDERED UNREASONABLE TO REQUIRE THE BIDDER TO TRY 729 DIFFERENT COMBINATIONS OF FIGURES TO DETERMINE WHICH OF HIS ALTERNATIVE BIDS HAD BEEN ACCEPTED. BUT IT IS NOT NECESSARY IN THIS CASE TO DETERMINE WHETHER SUCH AN ACCEPTANCE WOULD BE VALID SINCE THE NUMBER OF POSSIBILITIES IS MUCH FEWER. THE CONTRACT CONTEMPLATES A SINGLE SYSTEM OF SEWERS. IT IS STATED IN THE LETTER OF SEPTEMBER 20 THAT IT IS ONLY PROPER TO ASSUME THAT THE SAME KIND OF PIPE WOULD BE USED THROUGHOUT THE NEW SEWER AND NEW WATER CONSTRUCTION UNDER SUCH CIRCUMSTANCES. APPARENTLY ANYONE IN THE CONSTRUCTION BUSINESS WOULD MAKE THAT ASSUMPTION. IT THUS BECOMES POSSIBLE TO DETERMINE THE EXACT NATURE OF THE ACCEPTANCE BY TOTALING THE BIDS UNDER EACH DIFFERENT TYPE OF SEWER PIPE FOR THE FIVE PARTS OF THE PROJECT AND ADDING EACH IN TURN TO THE BIDS ON BASIC BID, PART III, FOR WOOD, IRON AND ASBESTOS WATER PIPES, RESPECTIVELY. THIS REDUCES THE POSSIBLE COMBINATION TO NINE. CONSIDERING THE DOLLAR VALUE OF THE CONTRACT, IT WOULD APPEAR THAT THE EFFORT REQUIRED TO DETERMINE THE EXACT NATURE OF THE ACCEPTANCE DID NOT IMPOSE ANY UNDUE BURDEN ON THE BIDDER. IT IS TRUE THAT, TO ARRIVE AT THE EXACT TOTAL, THE BIDDER WOULD HAVE HAD TO DISCOVER HIS TWENTY CENT ERROR IN ADDITION MADE IN THE BID FOR ONE OF THE NON-VARIABLE PARTS. BUT IN VIEW OF THE SMALL SIZE OF THE ERROR AS COMPARED TO THE DIFFERENCES IN THE PRICE WHICH WOULD BE PRODUCED BY THE SELECTION OF THE WRONG VARIABLE, IT DOES NOT APPEAR THAT SUCH ERROR SHOULD AFFECT OUR CONCLUSION.

COUNSEL FOR THE BIDDER CONTEND IN SOME OF THEIR CORRESPONDENCE WITH THE CONTRACTING OFFICER THAT THE BID WAS WITHDRAWN PRIOR TO ACCEPTANCE BY THE FOLLOWING LANGUAGE IN A LETTER MAILED ON MAY 26 AND RECEIVED ON MAY 31:

AS WE HAVE NOT RECEIVED THE AWARD OF CONTRACT WE RESERVE THE OPTION TO WITHDRAW OUR BID AS PROVIDED FOR IN THE INVITATION FOR BIDS.

THE CONTENTION IS NOT ACCEPTABLE FOR SEVERAL REASONS. IN THE FIRST PLACE, THE LANGUAGE OF A REVOCATION "SHOULD BE AS DIRECT AND EXPLICIT AS AN ACCEPTANCE.' 1 WILLISTON CONTRACTS 157 CITING LINN V. MCLEAN, 80 ALA. 350, 366. THE LANGUAGE OF THE LETTER OF MAY 26 CANNOT REASONABLY BE INTERPRETED AS INTENDING A WITHDRAWAL OF THE BID. SECONDLY, A WITHDRAWAL OF AN OFFER IS NOT EFFECTIVE UNTIL RECEIVED BY THE OFFEREE. BURTON V. UNITED STATES, SUPRA; B-4888, SUPRA.SINCE THE LETTER WAS RECEIVED ON MAY 31, IT COULD NOT OPERATE TO REVOKE AN OFFER WHICH WAS ACCEPTED ON MAY 27.

FROM THE FOREGOING, IT MUST BE CONCLUDED THAT THE MESSAGE FROM THE CONTRACTING OFFICER MAILED TO THE BIDDER FROM JUNEAU ON MAY 27 WAS A VALID ACCEPTANCE OF THE BID AND RESULTED IN A CONTRACT BINDING ON THE PARTIES.