B-126305, JAN. 3, 1956

B-126305: Jan 3, 1956

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TO THE SECRETARY OF THE ARMY: REFERENCE IS MADE TO YOUR LETTER OF DECEMBER 6. O. I. 3200 55 IS BASED. THE BID OF THE COMPANY WAS ACCEPTED ON JUNE 30. M. BRACAMONTE AND COMPANY ADVISED THAT ITS BID PRICE OF $6 PER ROLL FOR ITEM 4A WAS ERRONEOUS IN THAT IT WAS BASED ON FURNISHING A 36 INCH WIDTH ROLL AND NOT A 60 INCH WIDTH ROLL AS REQUIRED. M. BRACAMONTE AND COMPANY WAS SUBSTANTIALLY LOWER THAN THE OTHER BIDS RECEIVED ON ITEM 4A. IT WAS STATED FURTHER. THAT ITS BID PRICE FOR THE MATERIAL SHOULD HAVE BEEN $10.25 PER ROLL. IN VIEW OF THE DISPROPORTIONATE BID PRICE OF THE COMPANY AND THE FACT THAT THE COMPANY WAS UNDERBIDDING A CHICAGO FIRM'S F.O.B. ORIGIN PRICE ON A COMMODITY WHICH IS NORMALLY HIGHER PRICED ON THE WEST COAST.

B-126305, JAN. 3, 1956

TO THE SECRETARY OF THE ARMY:

REFERENCE IS MADE TO YOUR LETTER OF DECEMBER 6, 1955, WITH ENCLOSURES, REQUESTING A DECISION AS TO THE ACTION TO BE TAKEN RELATIVE TO AN ERROR R. M. BRACAMONTE AND COMPANY, SAN FRANCISCO, CALIFORNIA, ALLEGES IT MADE IN ITS BID ON WHICH CONTRACT NO. O. I. 3200 55 IS BASED.

BY INVITATION NO. QM 11-009-55-514, THE CHICAGO QUARTERMASTER DEPOT, CHICAGO, ILLINOIS, REQUESTED BIDS--- TO BE OPENED ON JUNE 17, 1955--- FOR FURNISHING, AS ITEM 4, 196 ROLLS OF CORRUGATED SINGLE-FACE FLEXIBLE FIBERBOARD, TYPE III, 250 FEET LONG BY 60 INCHES WIDE, (A) F.O.B. DESTINATION, OR (B) F.O.B. ORIGIN. IN RESPONSE, R. M. BRACAMONTE AND COMPANY, A DISTRIBUTOR, SUBMITTED A BID DATED JUNE 13, 1955, OFFERING TO FURNISH ITEM 4 AT A PRICE OF $6 PER ROLL, F.O.B. DESTINATION, POLK, CALIFORNIA. THE BID OF THE COMPANY WAS ACCEPTED ON JUNE 30, 1955.

BY LETTER DATED AUGUST 4, 1955, IN WHICH IT REQUESTED THAT IT BE RELIEVED FROM OBLIGATION UNDER ITS BID, R. M. BRACAMONTE AND COMPANY ADVISED THAT ITS BID PRICE OF $6 PER ROLL FOR ITEM 4A WAS ERRONEOUS IN THAT IT WAS BASED ON FURNISHING A 36 INCH WIDTH ROLL AND NOT A 60 INCH WIDTH ROLL AS REQUIRED. IN SUPPORT OF ITS ALLEGATION OF ERROR, THE COMPANY SUBMITTED A COPY OF AN INTER-OFFICE TELETYPE SENT BY THE LOS ANGELES OFFICE OF THE SHERMAN PAPER PRODUCTS COMPANY--- THE COMPANY'S SUPPLIER--- TO ITS SAN FRANCISCO OFFICE, AUTHORIZING A QUOTATION TO R. M. BRACAMONTE AND COMPANY OF A PRICE OF $5.74 PER ROLL, LESS 5 PERCENT DISCOUNT, FOR 168 ROLLS OF 36 INCH BY 250 FEET OF MATERIAL IDENTICAL TO THAT CALLED FOR BY ITEM 4.

IN HIS REPORT RECOMMENDING THAT THE CONTRACT BE CANCELLED, THE CONTRACTING OFFICER STATED THAT HE HAD NOTED THAT THE BID OF R. M. BRACAMONTE AND COMPANY WAS SUBSTANTIALLY LOWER THAN THE OTHER BIDS RECEIVED ON ITEM 4A, INDICATING THE POSSIBILITY OF AN ERROR, BUT THAT BECAUSE HE HAD FOUND UPON REFERENCE TO RECORDS OF THE LAST PREVIOUS PROCUREMENT THAT A CONTRACT FOR IDENTICAL MATERIAL HAD BEEN AWARDED TO THE AJAX BOX COMPANY AT A PRICE OF $6.15 PER ROLL, AND BECAUSE OF THE NEARNESS OF THE COMPANY'S SHIPPING POINT--- LOS ANGELES--- TO THE F.O.B. POINT, HE DID NOT REQUEST VERIFICATION OF THE LOW BID. IT WAS STATED FURTHER, HOWEVER, THAT A FURTHER CHECK OF THE RECORDS REVEALED THAT THE AJAX BOX COMPANY HAD ADVISED, AFTER AWARD OF THE PREVIOUS CONTRACT AT A PRICE OF $6.15 PER ROLL, THAT ITS BID PRICE FOR THE MATERIAL SHOULD HAVE BEEN $10.25 PER ROLL. IN VIEW OF THE DISPROPORTIONATE BID PRICE OF THE COMPANY AND THE FACT THAT THE COMPANY WAS UNDERBIDDING A CHICAGO FIRM'S F.O.B. ORIGIN PRICE ON A COMMODITY WHICH IS NORMALLY HIGHER PRICED ON THE WEST COAST, THE CONTRACTING OFFICER CONCLUDED THAT THE COMPANY SHOULD HAVE BEEN REQUESTED TO VERIFY ITS BID PRICE BEFORE AWARD.

THE ABSTRACT OF BIDS SHOWS THAT THE THREE OTHER BIDDERS ON ITEM 4A (F.O.B. DESTINATION) SPECIFIED PRICES OF $10.40 (TWO BIDS) AND $10.66 PER ROLL, AND THAT THE LOWEST BID RECEIVED ON ITEM 4B (F.O.B. ORIGIN) WAS IN THE AMOUNT OF $6.66 PER ROLL. IN VIEW OF THE DIFFERENCE BETWEEN THE BID OF THE COMPANY OF $6 PER ROLL FOR ITEM 4A AND THE OTHER BIDS ON THAT ITEM AND THE LOWEST BID RECEIVED ON ITEM 4B, THE PROBABILITY OF ERROR WAS APPARENT AND, IN THE CIRCUMSTANCES, THE BID AS TO ITEM 4A SHOULD NOT HAVE BEEN ACCEPTED WITHOUT REQUESTING VERIFICATION.

ON THE RECORD, THERE IS NO ROOM FOR DOUBT THAT R. M. BRACAMONTE AND COMPANY MADE AN ERROR IN ITS BID, AS ALLEGED. ACCORDINGLY, AND SINCE IT IS REPORTED THAT NO DELIVERIES OF THE MATERIAL COVERED BY ITEM 4A HAVE BEEN MADE, CONTRACT NO. O.I. 3200-55 SHOULD BE CANCELED WITHOUT LIABILITY TO THE COMPANY.

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