B-129112, SEP. 10, 1956

B-129112, SEP. 10, 1956

TO THE SECRETARY OF THE ARMY:

REFERENCE IS MADE TO A LETTER DATED AUGUST 29, 1956 WITH ENCLOSURES IN DUPLICATE, FROM THE ASSISTANT SECRETARY OF THE ARMY (LOGISTICS), RELATING TO A MISTAKE IN BID ALLEGED BY THE STANDARD SCIENTIFIC SUPPLY CORPORATION, 34 WEST 4TH STREET, NEW YORK 12, NEW YORK, AFTER THE AWARD OF PURCHASE ORDER NO. FD6-404-6893, DATED JUNE 25, 1956. IN VIEW OF THE FACTS SET FORTH IN THE ENCLOSURES TO THE LETTER OF AUGUST 29, A DECISION IS REQUESTED AS TO WHETHER THE CONTRACTOR'S APPLICATION FOR RELIEF MAY BE GRANTED.

THE RECORD SHOWS THAT BY INVITATION NO. 18-064-56-142, DATED APRIL 24, 1956, THE CONTRACTING OFFICER, BIOLOGICAL WARFARE LABS., FORT DETRICK, FREDERICK, MARYLAND, SOLICITED BIDS--- TO BE OPENED AT 2:00 P.M. ON MAY 24, 1956--- FOR THE PROCUREMENT OF 55 SEPARATE AND DISTINCT SUPPLY ITEMS, INCLUDING ITEM 35 DESCRIBED THEREIN AS FOLLOWS:

"15 EACH--- 6640, MORTAR AND PESTLE, 100 MM. HIGH; PORCELAIN, SIZE NO. 4. WILL CORP. NO. 20241 OR EQUAL.'

IN RESPONSE TO THE INVITATION, THE STANDARD SCIENTIFIC SUPPLY CORPORATION SUBMITTED A LOW BID OF $57.98 FOR THE ENTIRE LOT OF 15 OR AT A COST PER UNIT OF $3.87. THE NEXT LOW BID WAS IN THE AMOUNT OF $5.69 PER UNIT, AND THE HIGHEST OF THE REMAINING BIDS WAS $92.67 FOR THE LOT OR $6.17 PER UNIT. UNDER DATE OF JUNE 25, 1956, CONTRACT NO. FD6-404-6893 WAS AWARDED TO THE LOW BIDDER FOR ITEM 35, ALONG WITH ANOTHER ITEM NOT INCLUDED IN THE CLAIM OF ERROR.

BY LETTER OF JUNE 26, 1956, TO THE CONTRACTING OFFICER, THE CONTRACTOR ALLEGED THAT IT HAD MADE A MISTAKE IN ITS BID AS TO ITEM 35; THAT ITS ERRONEOUS QUOTATION "WAS BASED ON COORS NO. 522 WHICH CALLED FOR A PRICE OF $57.98 PER 15," AND THAT THE QUOTATION PROPERLY SHOULD HAVE BEEN "ON COORS NO. 520 WHICH CALLS FOR A PRICE OF $92.49 PER 15.' RESPECTING THE ALLEGATION OF ERROR, THE CONTRACTING OFFICER REPORTS THAT THE PURCHASING AGENT RESPONSIBLE FOR THE PROCUREMENT DID NOT CONSIDER THE DISPARITY IN PRICES TO BE SIGNIFICANT, AND DID NOT REQUEST A VERIFICATION OF THE LOW BID PRIOR TO THE AWARD, SINCE HE HAD NOTED A WIDE SPREAD OF QUOTED PRICES IN THE PAST ON PORCELAIN GOODS, ON SOME OCCASIONS, FROM TIME TO TIME.

IT IS APPARENT THAT THE REPORTED ERROR IN THIS CASE WAS DUE SOLELY TO THE FAULT OR NEGLIGENCE OF THE BIDDER. THE DIFFERENCE IN PRICE BETWEEN THE LOW BID AND THE NEXT LOW BID WAS NOT SUBSTANTIAL, AND THERE IS NOTHING OTHERWISE OF RECORD TO INDICATE THAT THE CONTRACTING OFFICER WAS ON NOTICE, ACTUAL OR CONSTRUCTIVE, OF THE ERROR. HENCE, THE ACCEPTANCE OF THE BID WAS IN GOOD FAITH, NO ERROR HAVING BEEN ALLEGED UNTIL AFTER AWARD, AND SUCH ACCEPTANCE CONSUMMATED A VALID AND BINDING OBLIGATION WHICH FIXED THE RIGHTS AND OBLIGATIONS OF THE PARTIES. SEE UNITED STATES V. PURCELL ENVELOPE COMPANY, 249 U.S. 313, AND AMERICAN SMELTING AND REFINING COMPANY V. UNITED STATES, 259 U.S. 75. ACCORDINGLY, THERE IS NO LEGAL BASIS FOR MODIFICATION OF THE CONTRACT BECAUSE OF THE ALLEGED MISTAKE IN BID.

THE ORIGINALS OF THE ENCLOSURES TO THE LETTER OF AUGUST 29 ARE RETURNED HEREWITH, THE DUPLICATES BEING RETAINED FOR THE FILES OF THIS OFFICE.