B-129172, SEP. 21, 1956

B-129172: Sep 21, 1956

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TO THE SECRETARY OF THE NAVY: REFERENCE IS MADE TO LETTER OF SEPTEMBER 7. DUE TO AN ERROR ALLEGED BY THE COMPANY TO HAVE BEEN MADE IN ITS BID ON THAT ITEM. 10 AND 17 WAS ACCEPTED ON AUGUST 8. IT IS REPORTED THAT ON AUGUST 6. THE DATE THE BIDS WERE OPENED. NAKAZAWA SHOTEN ALLEGED THAT AN ERROR HAD BEEN MADE IN ITS BID ON ITEM 17 IN THAT THE PRICE SHOULD HAVE BEEN YEN 20. THE VERBAL ALLEGATION OF ERROR WAS CONFIRMED BY LETTER DATED AUGUST 7. THERE WAS SUBMITTED IN SUPPORT THEREOF A COPY OF THE INVITATION ON WHICH THE PRICES THE COMPANY INTENDED TO BID WERE WRITTEN AT THE TIME THE MATERIAL WAS INSPECTED. IT IS ALLEGED THAT THE ERROR WAS MADE BY THE CLERK OF THE COMPANY IN TRANSCRIBING THE PRICES FROM THE WORK COPY TO THE BID FORM SUBMITTED.

B-129172, SEP. 21, 1956

TO THE SECRETARY OF THE NAVY:

REFERENCE IS MADE TO LETTER OF SEPTEMBER 7, 1956, WITH ENCLOSURES, FROM THE ASSISTANT SECRETARY OF THE NAVY (MATERIAL), REQUESTING A DECISION AS TO WHETHER ITEM 17 PROPERLY MAY BE DELETED FROM CONTRACT NO. N62649S-3320 WITH NAKAZAWA SHOTEN, YOKOSUKA, JAPAN, DUE TO AN ERROR ALLEGED BY THE COMPANY TO HAVE BEEN MADE IN ITS BID ON THAT ITEM.

THE UNITED STATES NAVAL SUPPLY DEPOT, YOKOZUKA, JAPAN, BY SALES CATALOG NO. B-4-57, REQUESTED BIDS--- TO BE OPENED ON AUGUST 6, 1956-- ON VARIOUS ITEMS OF SURPLUS MATERIALS. ITEM 17 CONSISTED OF MISCELLANEOUS SHIPS REPAIR PARTS AND REQUESTED BIDS ON A LOT BASIS. IN RESPONSE TO THE INVITATION, NEKAZAWA SHOTEN SUBMITTED A BID OFFERING TO PURCHASE, AMONG OTHERS, ITEM 17 FOR THE AMOUNT OF YEN 207,000.00. THE BID OF NAKAZAWA SHOTEN, ON ITEMS 2, 6, 10 AND 17 WAS ACCEPTED ON AUGUST 8, 1956, UNDER CONTRACT NO. N62649S-3320.

IT IS REPORTED THAT ON AUGUST 6, 1956, THE DATE THE BIDS WERE OPENED, NAKAZAWA SHOTEN ALLEGED THAT AN ERROR HAD BEEN MADE IN ITS BID ON ITEM 17 IN THAT THE PRICE SHOULD HAVE BEEN YEN 20,700.00 RATHER THAN YEN 207,000.00. THE VERBAL ALLEGATION OF ERROR WAS CONFIRMED BY LETTER DATED AUGUST 7, 1956, AND THERE WAS SUBMITTED IN SUPPORT THEREOF A COPY OF THE INVITATION ON WHICH THE PRICES THE COMPANY INTENDED TO BID WERE WRITTEN AT THE TIME THE MATERIAL WAS INSPECTED. IT IS ALLEGED THAT THE ERROR WAS MADE BY THE CLERK OF THE COMPANY IN TRANSCRIBING THE PRICES FROM THE WORK COPY TO THE BID FORM SUBMITTED.

THE RECORD SHOWS THAT THE SIX OTHER BIDS RECEIVED ON ITEM 17 WERE IN THE AMOUNTS OF YEN 37,000.00, YEN 35,500.00, YEN 31,900.00, YEN 30,600.00, YEN 20,000.00 AND YEN 13,600.00. THE PRICE OF YEN 207,000.00 QUOTED BY NAKAZAWA SHOTEN IS SUBSTANTIALLY IN EXCESS OF THE AMOUNTS QUOTED BY THE OTHER BIDDERS FOR THE MATERIAL, WHEREAS THE ALLEGED INTENDED PRICE OF YEN 20,700.00 IS IN LINE WITH THE OTHER BIDS.

ON THE BASIS OF THE FACTS AND EVIDENCE OF RECORD, THERE APPEARS TO BE LITTLE DOUBT THAT AN ERROR WAS MADE ON ITEM 17 OF THE BID, AS ALLEGED. SINCE THE ERROR WAS ALLEGED AND EXPLAINED BY THE COMPANY PRIOR TO AWARD, THE ACCEPTANCE OF THE BID AS TO ITEM 17 MAY NOT BE CONSIDERED AS CONSUMMATING A VALID AND BINDING CONTRACT. ACCORDINGLY, ITEM 17 SHOULD BE DELETED FROM THE CONTRACT NO. N62649S-3320.

THE PAPERS, WITH THE EXCEPTION OF THE MEMORANDUM DATED AUGUST 23, FROM THE COMMANDING OFFICER, NAVY NO. 3923, TO THE BUREAU OF SUPPLIES AND ACCOUNTS, WASHINGTON, D.C., ARE RETURNED HEREWITH.