B-129704, NOV. 9, 1956

B-129704: Nov 9, 1956

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DEPARTMENT OF THE INTERIOR: REFERENCE IS MADE TO YOUR AIR MAIL LETTER DATED NOVEMBER 2. THE COMPARISON PRICE WAS $11. THE MANUFACTURING SITE OF THE TRANSFORMERS WAS IDENTIFIED AS LOUGHBOROUGH. THE BIDDER TELEPHONED AND WROTE ALLEGING THAT ITS BID UNDER EACH SCHEDULE WAS ERRONEOUS SINCE IT FAILED TO INCLUDE THE INLAND FREIGHT CHARGES FROM A WEST COAST PORT OF THE UNITED STATES TO THE RESPECTIVE DESTINATIONS IN UTAH. WHICH WAS NOT RETAINED BY IT. ALLEGED THAT WHEN ITS SHIPPING AGENT QUOTED FREIGHT RATES TO IT FOR PREPARATION OF BID PRICES IT WAS UNDER THE MISTAKEN IMPRESSION THAT THOSE CHARGES INCLUDED BOTH OCEAN AND INLAND FREIGHT. AFTER SUBMISSION OF THE BID IT WAS DISCOVERED THAT THOSE CHARGES REPRESENT OCEAN FREIGHT ONLY.

B-129704, NOV. 9, 1956

TO MR. L. N. MCCLELLAN, CONTRACTING OFFICER, DEPARTMENT OF THE INTERIOR:

REFERENCE IS MADE TO YOUR AIR MAIL LETTER DATED NOVEMBER 2, 1956, WITH ENCLOSURES, REQUESTING A DECISION WHETHER BRUSH ABOVE, INC., WOODSIDE, LONG ISLAND, NEW YORK, MAY CORRECT AN ALLEGED ERROR IN BID AND RECEIVE AN AWARD ON THE BASIS OF THE CORRECTED PRICES.

BRUSH ABOVE, INC. BID $9,080 F.O.B. DESTINATION TO FURNISH UNDER SCHEDULE 1 ONE 1500 KVA POWER TRANSFORMER FOR THE WANSHIP POWER PLANT, UTAH, AND $23,380 F.O.B. DESTINATION TO FURNISH UNDER SCHEDULE 2 TWO 2,000/2,300 KVA POWER TRANSFORMERS FOR THE GATEWAY POWER PLANT, UTAH. ADDING TO THE F.O.B. DESTINATION PRICE THE FACTORS OF EFFICIENCY, SERVICES OF AN ERECTING ENGINEER AND FOREIGN SOURCE DIFFERENTIAL, THE COMPARISON PRICE WAS $11,405.30 FOR THE EQUIPMENT UNDER SCHEDULE 1 AND $23,380 FOR THE EQUIPMENT UNDER SCHEDULE 2. THE MANUFACTURING SITE OF THE TRANSFORMERS WAS IDENTIFIED AS LOUGHBOROUGH, LEICESTERSHIRE, ENGLAND, INDICATING THAT THE SHIPMENT WOULD MOVE THROUGH A WEST COAST PORT OF THE UNITED STATES.

TWO WEEKS AFTER THE BID OPENING, THE BIDDER TELEPHONED AND WROTE ALLEGING THAT ITS BID UNDER EACH SCHEDULE WAS ERRONEOUS SINCE IT FAILED TO INCLUDE THE INLAND FREIGHT CHARGES FROM A WEST COAST PORT OF THE UNITED STATES TO THE RESPECTIVE DESTINATIONS IN UTAH. IN A SUBSEQUENT SWORN STATEMENT, THE BIDDER RECAPITULATED ITS ORIGINAL WORK SHEET, WHICH WAS NOT RETAINED BY IT, AND ALLEGED THAT WHEN ITS SHIPPING AGENT QUOTED FREIGHT RATES TO IT FOR PREPARATION OF BID PRICES IT WAS UNDER THE MISTAKEN IMPRESSION THAT THOSE CHARGES INCLUDED BOTH OCEAN AND INLAND FREIGHT; HOWEVER, AFTER SUBMISSION OF THE BID IT WAS DISCOVERED THAT THOSE CHARGES REPRESENT OCEAN FREIGHT ONLY. THE INLAND FREIGHT, CALCULATED BY THE BIDDER'S SHIPPING AGENT, AMOUNTS TO $427 FOR SCHEDULE 1 AND $1,012 FOR SCHEDULE 2. AS A RESULT, THE BIDDER REQUESTS THAT ITS BID BE CORRECTED TO REFLECT THOSE CHARGES.

THE SEVEN OTHER F.O.B. DESTINATION BIDS RANGED IN PRICE FROM $13,080 TO $18,919 ON SCHEDULE 1, AND FROM $33,010 TO $44,865 ON SCHEDULE 2. THE ENGINEERS' COMPARISON PRICE ESTIMATE WAS $17,000 FOR SCHEDULE 1 AND $41,000 FOR SCHEDULE 2.

IT APPEARS THAT THE ERROR WAS ALLEGED AND EXPLAINED PRIOR TO AWARD AND THERE IS SUBSTANTIAL EVIDENCE ESTABLISHING THAT AN ERROR IN FACT WAS MADE AND WHAT THE BIDDER'S PRICE WAS INTENDED TO BE. MOREOVER, THE CORRECTION OF THE BID WILL NOT AFFECT ADVERSELY THE OTHER BIDDERS, SINCE THE CORRECTED BID WILL STILL BE SUBSTANTIALLY LOWER THAN THE NEXT LOW BID. ACCORDINGLY, THE BID PRICE SHOULD BE INCREASED BY $1,439 ($427 PLUS $1,012), AND IF THE BID HAS BEEN DETERMINED TO BE OTHERWISE ACCEPTABLE, AN AWARD SHOULD BE MADE ON THE BASIS OF THE CORRECTED PRICE.