B-126736, JAN. 30, 1956

B-126736: Jan 30, 1956

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TO THE HONORABLE SECRETARY OF THE ARMY: REFERENCE IS MADE TO A LETTER DATED JANUARY 19. THE BIDDERS WERE AWARDED A CONTRACT AT THE TOTAL CONTRACT PRICE OF $310. THIS WAS FOLLOWED BY A LETTER DATED JULY 7. THE BIDDERS COMPLETELY OVERLOOKED THIS ITEM IN THE WORKSHEETS UPON WHICH THEIR BID WAS BASED. IT IS SHOWN THAT THE CONTRACTOR'S BID FOR ITEM A-3A4 (ALTERNATE) IS $181. 000 WHICH IS $51. THUS INDICATING THAT IT WAS OUT OF LINE WITH THE OTHER BIDS SUBMITTED. IT IS THE RECOMMENDATION OF THE ASSISTANT DISTRICT ENGINEER. THE WORKSHEETS ALSO CLEARLY SHOW THAT AN ERROR WAS MADE AS ALLEGED AND THE AMOUNT THEREOF APPEARS TO BE REASONABLY ESTABLISHED. THE RECORD DOES NOT INDICATE THAT THE EXECUTION OF THE FORMAL CONTRACT SUBSEQUENT TO THE ALLEGATION OF ERROR WAS INTENDED BY EITHER OF THE PARTIES THERETO TO BE A WAIVER OF ANY RIGHTS WHICH THE CONTRACTOR MIGHT OTHERWISE HAVE FOR AN INCREASE IN THE CONTRACT PRICE.

B-126736, JAN. 30, 1956

TO THE HONORABLE SECRETARY OF THE ARMY:

REFERENCE IS MADE TO A LETTER DATED JANUARY 19, 1956, WITH ENCLOSURES, FROM THE DEPUTY ASSISTANT SECRETARY OF THE ARMY (LOGISTICS), REQUESTING A DECISION AS TO THE ACTION TO BE TAKEN BY YOUR DEPARTMENT IN CONNECTION WITH A MISTAKE IN BID ALLEGED BY SANDVIK, ROARK AND CURRY UNDER CONTRACT NO. DA-95-507-ENG-844, DATED JUNE 30, 1955.

IT APPEARS FROM THE RECORD THAT IN RESPONSE TO INVITATION NO. ENG-95 507- 55-68, SANDVIK, ROARK AND CURRY SUBMITTED A BID FOR THE CONSTRUCTION OF FAMILY HOUSING, WITH OUTSIDE FACILITIES TO SERVE, AND IMPROVEMENTS TO FAMILY HOUSING AT THE WILDWOOD STATION, KENAI, ALASKA, AND THAT UNDER DATE OF JUNE 30, 1955, THE BIDDERS WERE AWARDED A CONTRACT AT THE TOTAL CONTRACT PRICE OF $310,529.

UNDER DATE OF JUNE 24, 1955--- PRIOR TO AWARD--- THE BIDDERS VERBALLY ALLEGED ERROR, AND THIS WAS FOLLOWED BY A LETTER DATED JULY 7, 1955, IN WHICH THE BIDDERS ALLEGED THAT THEY FAILED TO INCLUDE ANY AMOUNT FOR THE MILLWORK INVOLVED IN SCHEDULE 3A, SINCE THEY HAD NOT THEN RECEIVED ANY MILLWORK QUOTATIONS. SUBSEQUENTLY, THE ATTORNEYS FOR THE CONTRACTOR ADDRESSED A LETTER DATED SEPTEMBER 15, 1955, TO THE DISTRICT ENGINEER, ENCLOSING AN AFFIDAVIT BY MR. BERTRAM CURRY, STATING THAT SINCE A QUOTATION FOR THE MILLWORK HAD NOT BEEN RECEIVED FROM ACME MILLWORK, INC., THE BIDDERS COMPLETELY OVERLOOKED THIS ITEM IN THE WORKSHEETS UPON WHICH THEIR BID WAS BASED.

IN LETTER OF OCTOBER 10, 1955, TO THE CHIEF OF ENGINEERS, THE ASSISTANT DISTRICT ENGINEER FURNISHED A COMPARISON OF THE BIDS RECEIVED AND THE GOVERNMENT'S ESTIMATE FOR SCHEDULE A-3A4 AND SELECTED BID ITEMS OF THE UNIT PRICE SCHEDULE. IT IS SHOWN THAT THE CONTRACTOR'S BID FOR ITEM A-3A4 (ALTERNATE) IS $181,000 WHICH IS $51,017 UNDER THE GOVERNMENT ESTIMATE AND $119,000 UNDER THE SECOND LOW BID, THUS INDICATING THAT IT WAS OUT OF LINE WITH THE OTHER BIDS SUBMITTED. AFTER RECEIVING CERTAIN PERTINENT FACTS INVOLVED IN THIS MATTER, THE ASSISTANT DISTRICT ENGINEER CONCLUDED (PARAGRAPH 8) THAT ERROR IN THE AMOUNT OF $23,230 HAD BEEN ESTABLISHED, AND THAT THAT AMOUNT TOGETHER WITH THE SUM OF $5,960, AS AN EQUITABLE FIGURE FOR LABOR COSTS, OR A TOTAL OF $29,190, REPRESENTS THE MATERIAL AND LABOR COSTS ARISING OUT OF THE MISTAKE IN BID. ON THE BASIS OF THE SHOWING MADE, IT IS THE RECOMMENDATION OF THE ASSISTANT DISTRICT ENGINEER, AS WELL AS THE CONTRACTING OFFICER, THAT THE CONTRACT BE MODIFIED SO AS TO ALLOW THE ADDITIONAL AMOUNT OF $29,190.

THE EVIDENCE SUBMITTED INDICATES THAT THE CONTRACTING OFFICER HAD NOTICE OF THE ERROR PRIOR TO THE ACCEPTANCE OF THE BID. THE WORKSHEETS ALSO CLEARLY SHOW THAT AN ERROR WAS MADE AS ALLEGED AND THE AMOUNT THEREOF APPEARS TO BE REASONABLY ESTABLISHED. MOREOVER, THE RECORD DOES NOT INDICATE THAT THE EXECUTION OF THE FORMAL CONTRACT SUBSEQUENT TO THE ALLEGATION OF ERROR WAS INTENDED BY EITHER OF THE PARTIES THERETO TO BE A WAIVER OF ANY RIGHTS WHICH THE CONTRACTOR MIGHT OTHERWISE HAVE FOR AN INCREASE IN THE CONTRACT PRICE.

ACCORDINGLY, SINCE THE ERROR WAS ALLEGED PRIOR TO THE AWARD AND SINCE THE CORRECTED PRICE WILL STILL BE LOWER THAN THE NEXT LOW BID, THE CONTRACT HEREIN MAY BE AMENDED SO AS TO ALLOW ADDITIONAL COMPENSATION IN THE AMOUNT OF $29,190.

REFERENCE TO THIS DECISION SHOULD BE MADE IN ANY AMENDMENT TO THE CONTRACT.

THE PAPERS, WITH THE EXCEPTION OF THE ASSISTANT DISTRICT ENGINEER'S LETTER OF OCTOBER 10, 1955, AND ENDORSEMENTS THEREON, AND THE CONTRACTING OFFICER'S STATEMENT DATED OCTOBER 14, 1955, ARE RETURNED HEREWITH.