B-128868, AUG. 17, 1956

B-128868: Aug 17, 1956

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TO THE SECRETARY OF THE NAVY: REFERENCE IS MADE TO A LETTER DATED AUGUST 7. A DECISION IS REQUESTED AS TO WHETHER RELIEF PROPERLY MAY BE GRANTED AS RECOMMENDED BY THE CONTRACTING OFFICER. THAT ITS BID OF $163 ON ITEM 13 COVERING ONE AIR COMPRESSOR WAS ACCEPTED ON JULY 12. THE INVITATION SHOWS THE ACQUISITION COST OF ITEM 13 TO HAVE BEEN $30. ITS CONDITION WAS DESCRIBED AS "USED-POOR.'. THE CONTRACTING OFFICER REPORTS THAT SINCE THE PRICE BID WAS CONSIDERED EXCESSIVE. THE BIDDER WAS REQUESTED TO "RESTATE HIS BID AND INTENTIONS ON THE AIR COMPRESSOR.'. AN AWARD WAS EFFECTED IN VIEW OF THE CONFIRMATION. CONCLUDING THAT THE BIDDER MUST HAVE HAD A SPECIFIC REASON FOR PLACING THE BID. IT APPEARS FROM THE ABSTRACT OF BIDS THAT SIX OTHER BIDS WERE RECEIVED FOR ITEM 13 IN THE AMOUNTS OF $12.10.

B-128868, AUG. 17, 1956

TO THE SECRETARY OF THE NAVY:

REFERENCE IS MADE TO A LETTER DATED AUGUST 7, 1956, WITH ENCLOSURES, FROM THE ASSISTANT SECRETARY OF THE NAVY (MATERIAL), RELATING TO A MISTAKE IN BID ALLEGED BY THE AMERICAN BARREL AND COOPERAGE COMPANY, SALT LAKE CITY, UTAH, IN CONNECTION WITH CONTRACT NO. N665S-29795, (SALES INVITATION NO. B -4-57 ISSUED BY THE NAVAL SUPPLY DEPOT, CLEAR FIELD, UTAH) COVERING THE SALE OF AN AIR COMPRESSOR. IN VIEW OF THE FACTS SET FORTH IN THE ENCLOSURES TO THE LETTER OF AUGUST 7, 1956, A DECISION IS REQUESTED AS TO WHETHER RELIEF PROPERLY MAY BE GRANTED AS RECOMMENDED BY THE CONTRACTING OFFICER.

IT APPEARS FROM THE RECORD THAT IN RESPONSE TO INVITATION NO. B-4 57, DATED JUNE 14, 1956, THE AMERICAN BARREL AND COOPERAGE COMPANY SUBMITTED BIDS FOR VARIOUS ITEMS COVERED BY THE INVITATION, AND THAT ITS BID OF $163 ON ITEM 13 COVERING ONE AIR COMPRESSOR WAS ACCEPTED ON JULY 12, 1956. THE INVITATION SHOWS THE ACQUISITION COST OF ITEM 13 TO HAVE BEEN $30, AND ITS CONDITION WAS DESCRIBED AS "USED-POOR.' THE CONTRACTING OFFICER REPORTS THAT SINCE THE PRICE BID WAS CONSIDERED EXCESSIVE, THE BIDDER WAS REQUESTED TO "RESTATE HIS BID AND INTENTIONS ON THE AIR COMPRESSOR.' LETTER OF JULY 9, 1956, THE BIDDER VERIFIED ITS BID FOR ITEM 13 AS IN THE AMOUNT OF $163. THE CONTRACTING OFFICER FURTHER REPORTS THAT ALTHOUGH HE AND THE UTAH GENERAL DEPOT DISPOSAL OFFICER BELIEVED THE PRICE TO BE EXCESSIVE, AN AWARD WAS EFFECTED IN VIEW OF THE CONFIRMATION, CONCLUDING THAT THE BIDDER MUST HAVE HAD A SPECIFIC REASON FOR PLACING THE BID.

BY LETTER OF JULY 19, 1956, THE CONTRACTOR REQUESTED CANCELLATION OF THE CONTRACT ON THE BASIS OF AN ALLEGED MISTAKE IN BID, STATING THAT OFFICER PERSONNEL HAD FILLED IN THE WRONG BID, IT HAVING BEEN INTENDED TO BID ON ITEM 5 OF THE INVITATION NO. B-338-56 COVERING A COMPRESSOR HAVING AN ESTIMATED ACQUISITION COST OF $2,500. THE LETTER ALSO CONTAINS A STATEMENT CONCERNING THE VERIFICATION OF THE BID WITHOUT A REEXAMINATION OF THE BID FORM, NO FILE COPY HAVING BEEN RETAINED.

IT APPEARS FROM THE ABSTRACT OF BIDS THAT SIX OTHER BIDS WERE RECEIVED FOR ITEM 13 IN THE AMOUNTS OF $12.10, $5.75, $1.50, $3, $3.77, AND $6.66, AS COMPARED TO THE CONTRACTOR'S BID OF $163. IT IS THUS APPARENT WHY THE CONTRACTING OFFICER FELT CALLED UPON TO REQUEST VERIFICATION OF THE BID. IN RECOMMENDING THAT RELIEF BE GRANTED IN THIS CASE, THE CONTRACTING OFFICER STATED THAT IT IS FEASIBLE THAT THE HAPPENINGS RELATIVE TO THE CONTRACTOR'S BID WERE UNDOUBTEDLY AS STATED IN THE LETTER OF JULY 19, 1956, AND THAT THE CONTRACTOR WOULD UNDOUBTEDLY HAVE DETECTED THE ERROR PRIOR TO THE CONFIRMATION IF DUPLICATE COPIES OR RECORDS OF THE BIDS HAD BEEN MAINTAINED.

IT IS THE GENERAL RULE THAT A BIDDER MAY NOT BE RELIEVED FROM THE CONSEQUENCES OF AN INCORRECT BID, ONCE HE HAS BEEN AFFORDED THE OPPORTUNITY OF CONFIRMING HIS ORIGINAL QUOTATION PRIOR TO AWARD. HOWEVER, THE FACTS IN THE INSTANT MATTER APPEAR TO MAKE THIS CASE AN EXCEPTION TO THE GENERAL RULE. THERE IS NO SHOWING THAT THE BIDDER WAS ADVISED THAT THE OTHER BIDS WERE IN ONLY NOMINAL AMOUNTS, OR THAT ITS ATTENTION WAS DIRECTED TO THE GOVERNMENT'S COST. IN OTHER WORDS, IT IS NOT CLEAR THAT THE ENTIRE PICTURE WAS BROUGHT TO THE BIDDER'S ATTENTION. IT SEEMS REASONABLE TO ASSUME THAT HAD THIS BEEN DONE THE BIDDER WOULD HAVE DISCOVERED THE ALLEGED ERROR PRIOR TO AWARD. IN THE CIRCUMSTANCES, WE CONCLUDE THAT THE ACCEPTANCE OF THE BID, EVEN AFTER VERIFICATION, SHOULD NOT BE REGARDED AS BINDING. ACCORDINGLY, THE CONTRACT MAY BE CANCELLED AND A REFUND MADE OF THE BID DEPOSIT.

THE PAPERS TRANSMITTED WITH THE LETTER OF AUGUST 7, 1956, WITH THE EXCEPTION OF THE CONTRACTING OFFICER'S STATEMENT, ARE RETURNED HEREWITH.