B-125684, OCT. 19, 1955

B-125684: Oct 19, 1955

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TO THE HONORABLE SECRETARY OF THE NAVY: REFERENCE IS MADE TO A LETTER DATED SEPTEMBER 30. A DECISION IS REQUESTED AS TO THE APPROPRIATE ACTION TO BE TAKEN BY YOUR DEPARTMENT IN THE MATTER. SUBMITTED BIDS FOR CERTAIN OF THE ITEMS AND THE SAME WERE ACCEPTED AS TO ITEMS 2 AND 3. ONLY ITEM 3 IS BEING CONSIDERED HERE SINCE THE CONTRACTOR ALLEGED THAT A MISTAKE WAS MADE IN THAT THE BID COVERING THAT ITEM WAS INTENDED TO COVER ITEM 4 OF THE INVITATION. THE ACQUISITION COST WAS SHOWN AS 25 CENTS EACH. THE CONTRACTING OFFICER STATES THAT THE CLAIMANT HAS NOT ESTABLISHED THAT AN ERROR WAS ACTUALLY MADE IN ITS BID AND THAT HE CANNOT CONCLUSIVELY DETERMINE WHETHER OR NOT AN ERROR ACTUALLY EXISTED IN THE BID.

B-125684, OCT. 19, 1955

TO THE HONORABLE SECRETARY OF THE NAVY:

REFERENCE IS MADE TO A LETTER DATED SEPTEMBER 30, 1955, WITH ENCLOSURES, FROM THE ASSISTANT SECRETARY OF THE NAVY, RELATING TO A MISTAKE IN BID ALLEGED BY WF STEEL PRODUCTS, INC., NEW YORK, NEW YORK, UNDER CONTRACT NO. N665S-25283 (SALES INVITATION NO. B-49-56), ISSUED BY THE U.S. NAVAL SUPPLY DEPOT CLEAR FIELD, OGDEN, UTAH, AS SET FORTH IN THE COMMANDING OFFICER'S LETTER OF SEPTEMBER 23, 1955, WITH ENCLOSURES. IN VIEW OF THE FACTS SET FORTH IN THE ENCLOSURES TO THE LETTER OF SEPTEMBER 30, 1955, A DECISION IS REQUESTED AS TO THE APPROPRIATE ACTION TO BE TAKEN BY YOUR DEPARTMENT IN THE MATTER.

BY INVITATION NO. B-49-56, DATED AUGUST 11, 1955, THE DISPOSAL DIVISION U.S. NAVAL SUPPLY DEPOT CLEAR FIELD, OFFERED FOR SALE CERTAIN ITEMS OF USABLE SURPLUS PROPERTY, THE BIDS TO BE OPENED SEPTEMBER 1, 1955. RESPONSE, WF STEEL PRODUCTS, INC., SUBMITTED BIDS FOR CERTAIN OF THE ITEMS AND THE SAME WERE ACCEPTED AS TO ITEMS 2 AND 3. ONLY ITEM 3 IS BEING CONSIDERED HERE SINCE THE CONTRACTOR ALLEGED THAT A MISTAKE WAS MADE IN THAT THE BID COVERING THAT ITEM WAS INTENDED TO COVER ITEM 4 OF THE INVITATION.

ITEM 3 COVERED 1816 WRENCHES, SOCKET OFFSET, STEEL, DOUBLE END, SIZE 1/2 INCH DRIVE, 90 DEGREE BEND, AND THE ACQUISITION COST WAS SHOWN AS 25 CENTS EACH. AS TO THIS ITEM THE CLAIMANT SUBMITTED A BID OF$0.261 EACH AND EXTENDED THE TOTAL AS $310.85. INSPECTING THE ALLEGATION OF ERROR, THE CONTRACTING OFFICER STATES THAT THE CLAIMANT HAS NOT ESTABLISHED THAT AN ERROR WAS ACTUALLY MADE IN ITS BID AND THAT HE CANNOT CONCLUSIVELY DETERMINE WHETHER OR NOT AN ERROR ACTUALLY EXISTED IN THE BID; THAT THE BID OF $0.261 EACH ON ITEM 3 WAS REVIEWED BY HIM PRIOR TO ACCEPTANCE AND WAS NOT CONSIDERED EXCESSIVE INASMUCH AS THIS TYPE OF WRENCH HAS WIDE COMMERCIAL USAGE, THE RETAIL COMMERCIAL SELLING PRICE BEING CONSIDERABLY HIGHER THAN THE PRICE BID. THE CONTRACTING OFFICER IS OF THE VIEW THAT THE CONTRACTOR IS NOT ENTITLED TO RELIEF.

THE TOTAL OF THE WRENCHES (1816) COVERED BY ITEM 3 WHEN MULTIPLIED BY THE UNIT PRICE OF $0.261 MAKES A TOTAL OF $473.98, NOT THE SUM OF $310.85 SET FORTH IN THE BID--- A FACT READILY ESTABLISHED BY MERE MULTIPLICATION. THIS FACT ALONE SHOWS ERROR. FURTHERMORE, THE ABSTRACT OF BIDS SHOWS THAT THE BIDS SUBMITTED BY OTHER BIDDERS FOR ITEM 3 RANGED FROM $0.025 EACH TO $0.043 EACH. TAKING THESE FACTS INTO CONSIDERATION, INCLUDING THE FURTHER FACT THAT THE BID PRICE WAS IN EXCESS OF THE ORIGINAL ACQUISITION COST, IT APPEARS THAT THE CONTRACTING OFFICER SHOULD HAVE BEEN ON NOTICE OF THE PROBABILITY OF ERROR AND THAT THE BID SHOULD NOT HAVE BEEN ACCEPTED WITHOUT REQUESTING THE BIDDER TO VERIFY THE SAME.

THE EVIDENCE PRESENTED APPEARS TO ESTABLISH THE EXISTENCE OF A MISTAKE IN BID. ACCORDINGLY, THE BID AS TO ITEM 3 SHOULD BE DISREGARDED.

THE PAPERS TRANSMITTED WITH THE LETTER OF SEPTEMBER 30, 1955, WITH THE EXCEPTION OF THE CONTRACTING OFFICER'S STATEMENT DATED SEPTEMBER 20, 1955, AND THE ACTING COMMANDING OFFICER'S STATEMENT OF SEPTEMBER 23, 1955, ARE RETURNED HEREWITH.