B-126394, JAN. 13, 1956

B-126394: Jan 13, 1956

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TO THE HONORABLE SECRETARY OF THE NAVY: REFERENCE IS MADE TO A LETTER DATED DECEMBER 19. THE CONTRACTING OFFICER POINTED OUT THAT THE INSTANT CONTRACT IS CONSIDERABLY LOWER THAN THE PRICES QUOTED BY THE OTHER BIDDERS. THE CONTRACTING OFFICER WAS OF THE OPINION THAT THE CONTRACTOR'S QUOTATION WAS ERRONEOUS AND THAT SUCH ERROR WAS OBVIOUS AND SHOULD HAVE BEEN APPARENT PRIOR TO AWARD UPON EVALUATING THE QUOTATIONS. IT APPEARING THAT THE CONTRACTOR'S BID WAS SO FAR OUT OF LINE AS TO HAVE PLACED THE CONTRACTING OFFICER ON NOTICE OF PROBABLE ERROR. ARE RETURNED HEREWITH.

B-126394, JAN. 13, 1956

TO THE HONORABLE SECRETARY OF THE NAVY:

REFERENCE IS MADE TO A LETTER DATED DECEMBER 19, 1955, WITH ENCLOSURES, FROM THE ASSISTANT SECRETARY OF THE NAVY (MATERIAL), REQUESTING A DECISION AS TO WHETHER RELIEF PROPERLY MAY BE GRANTED THE INDUSTRIAL CONTAINER CORPORATION, BALTIMORE, MARYLAND, ON ACCOUNT OF AN ALLEGED MISTAKE IN BID UNDER CONTRACT NO. N189-15539A, DATED OCTOBER 26, 1955, ISSUED BY THE NAVY PURCHASING OFFICE, NAVAL SUPPLY CENTER, NORFOLK, VIRGINIA.

THE RECORD SHOWS THAT IN RESPONSE TO NEGOTIATION NO. 143 THE INDUSTRIAL CONTAINER CORPORATION MADE A LOW QUOTATION OF $774.10 PER THOUSAND SHEETS FOR FURNISHING 6,000 SHEETS OF CORRUGATED FIBERBOARD, SIZE 48 IN. WIDE BY 120 IN. LONG. FOLLOWING THE AWARD OF THE CONTRACT THE CONTRACTOR ALLEGED THAT IT HAD MADE A MISTAKE IN ITS BID AND ASKED TO BE RELIEVED FROM ANY LIABILITY UNDER THE CONTRACT.

IN RECOMMENDING THAT THE CONTRACTOR SHOULD BE ABSOLVED OF ALL LIABILITY UNDER THE CONTRACT, THE CONTRACTING OFFICER POINTED OUT THAT THE INSTANT CONTRACT IS CONSIDERABLY LOWER THAN THE PRICES QUOTED BY THE OTHER BIDDERS, AND THAT THIS FACT, COUPLED WITH THE SUBSTANTIALLY HIGHER PRICES ON RECENT PROCUREMENTS OF SIMILAR MATERIAL, SUPPORT THE CONTRACTOR'S ALLEGATION OF MISTAKE. ENCLOSURES (7) AND (8) TO THE STATEMENT OF FACTS AND RECOMMENDATION OF THE CONTRACTING OFFICER SHOW RECENT PURCHASES OF SIMILAR MATERIAL AT PRICES OF $1,056.15 AND $1,024. ON THE BASIS OF THE FOREGOING, THE CONTRACTING OFFICER WAS OF THE OPINION THAT THE CONTRACTOR'S QUOTATION WAS ERRONEOUS AND THAT SUCH ERROR WAS OBVIOUS AND SHOULD HAVE BEEN APPARENT PRIOR TO AWARD UPON EVALUATING THE QUOTATIONS.

WE AGREE WITH THE VIEWS OF THE CONTRACTING OFFICER THAT THE CONTRACTOR SHOULD BE RELIEVED FROM LIABILITY UNDER THE CONTRACT, IT APPEARING THAT THE CONTRACTOR'S BID WAS SO FAR OUT OF LINE AS TO HAVE PLACED THE CONTRACTING OFFICER ON NOTICE OF PROBABLE ERROR, THUS REQUIRING VERIFICATION BEFORE AWARD. UNDER THE REPORTED FACTS, THE CONTRACTOR MAY BE RELIEVED OF LIABILITY UNDER THE CONTRACT.

THE ENCLOSURES TO THE LETTER OF DECEMBER 19, 1955, WITH THE EXCEPTION OF THE CONTRACTING OFFICER'S STATEMENT, ARE RETURNED HEREWITH.