B-125586, OCT. 11, 1955

B-125586: Oct 11, 1955

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TO THE HONORABLE SECRETARY OF THE NAVY: REFERENCE IS MADE TO A LETTER DATED SEPTEMBER 22. DECISION IS REQUESTED AS TO THE APPROPRIATE ACTION TO BE TAKEN BY YOUR DEPARTMENT IN THE MATTER. ON THAT DAY A HIGH BID OF $45.7981 PER EACH WAS RECEIVED ON 80 STEEL PLATES LISTED AS ITEM 6 OF THE INVITATION. AN AWARD WAS MADE TO THE INDEPENDENT IRON WORKS UNDER CONTRACT NO. DELIVERY OF ITEM 6 WAS MADE ON MAY 20. IT BEING CLAIMED THAT ITS BID WAS COMPUTED ON A WEIGHT BASIS OF $2.75 PER CWT. WHICH WAS BY DIMENSIONS ONLY AND CONTAINED NO REFERENCE TO WEIGHT. WAS OBTAINED FROM A VISUAL INSPECTION BY HIS REPRESENTATIVE "IN ADDITION TO THE SUPPORTING DOCUMENTS.'. IT IS THE OPINION OF THE CONTRACTING OFFICER THAT THE CLAIMANT IS NOT ENTITLED TO RELIEF AND.

B-125586, OCT. 11, 1955

TO THE HONORABLE SECRETARY OF THE NAVY:

REFERENCE IS MADE TO A LETTER DATED SEPTEMBER 22, 1955, WITH ENCLOSURES, FROM THE ASSISTANT SECRETARY, RELATING TO A MISTAKE IN BID ALLEGED BY THE INDEPENDENT IRON WORKS, OAKLAND, CALIFORNIA, UNDER SALES INVITATION NO. B- 312-55, ISSUED BY THE U.S. NAVAL SUPPLY CENTER, OAKLAND, CALIFORNIA. VIEW OF THE FACTS SET FORTH IN THE ENCLOSURES TO A LETTER OF SEPTEMBER 22, 1955, DECISION IS REQUESTED AS TO THE APPROPRIATE ACTION TO BE TAKEN BY YOUR DEPARTMENT IN THE MATTER.

THE RECORD SHOWS THAT BY INVITATION NO. B-312-55, DATED APRIL 12, 1955, THE DISPOSAL DIVISION, NAVAL SUPPLY CENTER, OAKLAND, CALIFORNIA, OFFERED FOR SALE CERTAIN MISCELLANEOUS USABLE MATERIAL, THE BIDS TO BE OPENED ON MAY 3, 1955. ON THAT DAY A HIGH BID OF $45.7981 PER EACH WAS RECEIVED ON 80 STEEL PLATES LISTED AS ITEM 6 OF THE INVITATION, AND UNDER DATE OF MAY 11, 1955, AN AWARD WAS MADE TO THE INDEPENDENT IRON WORKS UNDER CONTRACT NO. N228S-9674. DELIVERY OF ITEM 6 WAS MADE ON MAY 20, 1955, FOLLOWING PAYMENT ON MAY 17, 1955.

BY LETTERS DATED JULY 8 AND AUGUST 3, 1955, THE CONTRACTOR REQUESTED A REFUND OF $2,153.72, BASED UPON AN ERROR ALLEGEDLY MADE WHILE PREPARING ITS BID, IT BEING CLAIMED THAT ITS BID WAS COMPUTED ON A WEIGHT BASIS OF $2.75 PER CWT., BUT THAT THE WEIGHT OF 3 PLATES INCLUDED IN ITEM 6 HAD BEEN ERRONEOUSLY CALCULATED AT 87,019 POUNDS INSTEAD OF A CORRECT 8,702 POUNDS, DUE TO DECIMAL ERROR. THE CONTRACTING OFFICER REPORTED THAT THE DESCRIPTION OF THE MATERIAL AS SET FORTH IN THE SALES INVITATION, WHICH WAS BY DIMENSIONS ONLY AND CONTAINED NO REFERENCE TO WEIGHT, WAS OBTAINED FROM A VISUAL INSPECTION BY HIS REPRESENTATIVE "IN ADDITION TO THE SUPPORTING DOCUMENTS.' ON THE BASIS OF THE FACTS OF THE CASE AND THE TERMS AND CONDITIONS OF THE SALES CONTRACT, IT IS THE OPINION OF THE CONTRACTING OFFICER THAT THE CLAIMANT IS NOT ENTITLED TO RELIEF AND, THEREFORE, HE RECOMMENDED THAT NO RELIEF BE GRANTED.

THE PLATES COVERED BY ITEM 6 WERE NOT OFFERED FOR SALE ON THE BASIS OF AN ESTIMATED OR ESTABLISHED WEIGHT--- THEY WERE DESCRIBED ONLY BY NUMBER (QUANTITY) AND SIZE. THE RECORD INDICATES THAT THE CLAIMANT'S BID WAS APPROXIMATELY 3.5 TIMES THAT OF THE SECOND HIGH BID. HOWEVER, IT HAS BEEN HELD BY THIS OFFICE IN NUMEROUS CASES THAT IN VIEW OF THE WIDE RANGE IN BIDS RECEIVED ON SURPLUS PROPERTY A MERE DIFFERENCE IN THE PRICES BID WOULD NOT NECESSARILY PLACE A CONTRACTING OFFICER ON NOTICE OF ERROR AS WOULD A LIKE DIFFERENCE IN THE PRICES QUOTED ON NEW EQUIPMENT, SUPPLIES, ETC., TO BE FURNISHED TO THE GOVERNMENT. 28 COMP. GEN. 550. SINCE THE SUBJECT BID IN THE AGGREGATE AMOUNTED TO ONLY 65 PERCENT OF THE ACQUISITION COST STATED, AND THE MATERIAL WAS DESCRIBED AS "APPARENTLY UNUSED, GOOD CONDITION," AND THE BIDDER WAS AN IRON WORKS RATHER THAN A JUNK OR SCRAP DEALER, THERE APPEARS TO HAVE BEEN NO REASON TO SUSPECT ERROR.

INSOFAR AS THE PRESENT RECORD SHOWS, THE ACCEPTANCE OF THE BID IN THIS CASE WAS IN GOOD FAITH, NO ERROR HAVING BEEN ALLEGED UNTIL AFTER AWARD, PAYMENT, AND DELIVERY OF THE MATERIAL. ACCORDINGLY, THE ACCEPTANCE OF THE BID CONSUMMATED A VALID AND BINDING CONTRACT WHICH FIXED THE RIGHTS AND OBLIGATIONS 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.

THE RESPONSIBILITY FOR THE PREPARATION OF A BID SUBMITTED IN RESPONSE TO AN INVITATION TO BID IS UPON THE BIDDER. SEE FRAZIER DAVIS CONSTRUCTION COMPANY V. UNITED STATES, 100 C.CLS. 120, 163. IF AN ERROR WAS MADE IN THE PREPARATION OF THE BID, AS ALLEGED, IT PROPERLY MAY BE ATTRIBUTED SOLELY TO THE CONTRACTOR'S NEGLIGENCE AND SINCE THE ERROR ON WHICH THE CLAIM HEREIN IS BASED WAS UNILATERAL, NOT MUTUAL, THE CONTRACTOR IS NOT ENTITLED TO RELIEF. SEE OGDEN AND DOUGHERTY V. UNITED STATES, 102 C.CLS. 249, 259, AND SALIGMAN, ET AL. V. UNITED STATES, 56 F.SUPP. 505, 507.

ACCORDINGLY, THERE IS NO LEGAL BASIS FOR ALLOWING THE CLAIM FOR MODIFICATION OF THE CONTRACT BECAUSE OF THE ALLEGED MISTAKE IN BID.

THE PAPERS TRANSMITTED WITH THE LETTER OF SEPTEMBER 22, 1955, WITH THE EXCEPTION OF THE CONTRACTING OFFICER'S REPORT AND RECOMMENDATION DATED SEPTEMBER 1, 1955, ARE RETURNED HEREWITH.