B-127827, JUN. 14, 1956

B-127827: Jun 14, 1956

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YOUR BID OF $138 FOR ITEM NO. 3 WAS THE ONLY ONE RECEIVED. IT WAS ACCEPTED AUGUST 31. A PURCHASE ORDER WAS MAILED TO YOU ON THE SAME DATE REQUIRING DELIVERY BY SEPTEMBER 30. YOU NOTIFIED THE VETERANS ADMINISTRATION HOSPITAL THAT THE PRICE OF ITEM NO. 3 COMPLETE WAS $498 IN PLACE OF $138 AS SHOWN IN THE BID. A TELEGRAM WAS DISPATCHED TO YOU STATING THAT DELIVERY WOULD BE REQUIRED AND THAT SINCE THE ALLEGED ERROR IN THE PRICE OF ITEM NO. 3 WAS CLAIMED AFTER AWARD HAD BEEN MADE. YOU WERE REQUESTED TO MAKE IMMEDIATE SHIPMENT OF THE REMAINING ITEMS ON THE ORDER. YOU STATE THAT "IT IS APPARENT THE CONTRACTING OFFICER NORMALLY WOULD HAVE KNOWN THAT THIS EQUIPMENT WAS WELL WORTH FAR MORE THAN THE $138.00 THAT WAS LISTED ON OUR QUOTATION.'.

B-127827, JUN. 14, 1956

TO WATSON ELEVATOR COMPANY, INC.:

YOUR LETTER OF APRIL 24, 1956, WITH ENCLOSURES, REQUESTS REVIEW OF OUR SETTLEMENT DATED APRIL 18, 1956, WHICH DISALLOWED YOUR CLAIM FOR $360 REPRESENTING AN ADDITIONAL SUM WHICH YOU ALLEGE TO BE DUE YOUR COMPANY BY REASON OF AN ERROR IN BID TO FURNISH THE VETERANS ADMINISTRATION HOSPITAL, TOMAH, WISCONSIN, ITEM NO. 3 UNDER PURCHASE ORDER NO. 322, DATED AUGUST 31, 1955.

IT APPEARS THAT UNDER DATE OF AUGUST 12, 1955, THE VETERANS ADMINISTRATION HOSPITAL, TOMAH, WISCONSIN, ISSUED INVITATION FOR BIDS NO. 56-23, TO BE OPENED AUGUST 31, 1955, FOR THE FURNISHING OF CERTAIN REPAIR PARTS IN ACCORDANCE WITH THE SPECIFICATIONS CONTAINED IN THE INVITATION. YOUR BID OF $138 FOR ITEM NO. 3 WAS THE ONLY ONE RECEIVED. IT WAS ACCEPTED AUGUST 31, 1955, AND A PURCHASE ORDER WAS MAILED TO YOU ON THE SAME DATE REQUIRING DELIVERY BY SEPTEMBER 30, 1955. BY WIRE DATED SEPTEMBER 14, 1955, YOU NOTIFIED THE VETERANS ADMINISTRATION HOSPITAL THAT THE PRICE OF ITEM NO. 3 COMPLETE WAS $498 IN PLACE OF $138 AS SHOWN IN THE BID. ON SEPTEMBER 15, 1955, A TELEGRAM WAS DISPATCHED TO YOU STATING THAT DELIVERY WOULD BE REQUIRED AND THAT SINCE THE ALLEGED ERROR IN THE PRICE OF ITEM NO. 3 WAS CLAIMED AFTER AWARD HAD BEEN MADE, IT WOULD BE NECESSARY TO SUBMIT THE MATTER TO HIGHER AUTHORITY FOR A DECISION ON THE REQUESTED PRICE ADJUSTMENT. YOU WERE REQUESTED TO MAKE IMMEDIATE SHIPMENT OF THE REMAINING ITEMS ON THE ORDER.

IN YOUR LETTER DATED APRIL 24, 1956, YOU STATE THAT "IT IS APPARENT THE CONTRACTING OFFICER NORMALLY WOULD HAVE KNOWN THAT THIS EQUIPMENT WAS WELL WORTH FAR MORE THAN THE $138.00 THAT WAS LISTED ON OUR QUOTATION.'

THERE WAS NOTHING ON THE FACE OF YOUR BID TO INDICATE THAT IT WAS NOT AS YOU INTENDED IT TO BE NOR IS THERE ANY INDICATION IN THE RECORD THAT THE CONTRACTING OFFICER, BEFORE ACCEPTANCE OF YOUR BID, KNEW OR HAD ANY MEANS OF KNOWING THAT A MISTAKE HAD BEEN MADE BY YOU IN YOUR BID. THE INVITATION WAS CLEAR AND UNAMBIGUOUS AND IF YOU MADE A MISTAKE IN SUBMITTING YOUR BID, SUCH MISTAKE WAS DUE SOLELY TO YOUR LACK OF CARE. WAS NOT INDUCED, OR IN ANY WAY CONTRIBUTED TO, BY THE GOVERNMENT.

THE ACCEPTANCE OF YOUR BID, AS SUBMITTED, CONSUMMATED A CONTRACT AND FIXED THE RIGHTS AND OBLIGATIONS OF THE PARTIES TO THAT CONTRACT. WHILE THE RECORD SHOWS THAT FOLLOWING YOUR ALLEGATION OF ERROR IN BID, YOU WERE REQUESTED TO PROCEED WITH YOUR UNDERTAKING AND ADVISED TO APPEAL TO OUR OFFICE FOR RELIEF, SUCH FACTS DO NOT AFFECT THE LEGAL RIGHTS OR OBLIGATIONS UNDER THE CONTRACT. IN COMPLETING YOUR CONTRACT YOU DID NO MORE THAN YOU WERE OBLIGATED TO DO UNDER YOUR ACCEPTED BID, AND SINCE YOU HAVE BEEN PAID IN FULL AT THE CONTRACT PRICE, NOTHING FURTHER IS DUE YOU. SEE, WILLARD, SUTHERLAND AND COMPANY V. UNITED STATES, 262 U.S. 489.

THE GENERAL RULE IS THAT WHEN THERE HAS BEEN A MISTAKE IN BID ON WHICH A CONTRACT IS BASED, THE CONTRACTOR MUST BEAR THE CONSEQUENCES OF THAT MISTAKE. IN ORDER TO AUTHORIZE RELIEF ON ACCOUNT OF A MISTAKE IN AN ACCEPTED BID, IT MUST APPEAR THAT THE MISTAKE WAS MUTUAL OR THAT THE ERROR WAS SO APPARENT THAT IT MUST BE PRESUMED THE CONTRACTING OFFICER KNEW OF THE MISTAKE AT THE TIME OF ACCEPTANCE AND SOUGHT TO TAKE ADVANTAGE OF IT. THE RECORD IN THIS CASE SHOWS THAT THE BID WAS ACCEPTED BY THE CONTRACTING OFFICER IN GOOD FAITH, WITHOUT NOTICE OF ANY ERROR. SEE, OGDEN AND DOUGHERTY V. UNITED STATES, 102 C.CLS. 249; AND SALIGMAN ET AL. V. UNITED STATES, 56 F.SUPP. 505, 507.

ACCORDINGLY, THE DISALLOWANCE DATED APRIL 18, 1956, IS SUSTAINED.