B-130207, JAN. 30, 1957

B-130207: Jan 30, 1957

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TO SECRETARY OF THE ARMY: REFERENCE IS MADE TO LETTER DATED DECEMBER 27. TO HAVE BEEN MADE ON ITEM NO. 75 OF HIS BID WHICH IS THE BASIS OF CONTRACT NO. UNLESS THE ITEM WAS OFFERED FOR SALE AS A LOT. WHEREIN THE ARTICLES OFFERED FOR SALE WERE DESCRIBED AND THE QUANTITIES GIVEN. THERE WERE OPPOSITE EACH ITEM THE WORDS . WHICH WAS CONSIDERED AS BEING A UNIT PRICE FOR EACH BOOM AND ON SEVERAL OTHER ITEMS. WAS ACCEPTED ON OCTOBER 5. MCDUFFIE ADVISED THAT THE NOTICE OF AWARD SHOWED THE PRICE OF ITEM 75 WAS $676 FOR THE FOUR BOOMS OR $169 EACH. WHEREAS HIS BID WAS INTENDED AS $169 FOR THE FOUR BOOMS OR $42.25 EACH. MCDUFFIE STATED THAT THE FIGURE 4 IN THE QUANTITY COLUMN WAS OBSCURE AND THAT WAS THE REASON FOR THE BID BEING ON A LOT BASIS RATHER THAN ON A UNIT BASIS.

B-130207, JAN. 30, 1957

TO SECRETARY OF THE ARMY:

REFERENCE IS MADE TO LETTER DATED DECEMBER 27, 1956, FROM THE ASSISTANT SECRETARY (LOGISTICS), REQUESTING A DECISION AS TO THE ACTION THAT SHOULD BE TAKEN WITH RESPECT TO AN ERROR ALLEGED BY JOHN H. MCDUFFIE OF ATLANTA, GEORGIA, TO HAVE BEEN MADE ON ITEM NO. 75 OF HIS BID WHICH IS THE BASIS OF CONTRACT NO. O.I. 2986, DATED OCTOBER 5, 1956.

THE ATLANTA GENERAL DEPOT, BY SPOT BID SALE NO. 09-030-S-57-4, REQUESTED BIDS ON VARIOUS ITEMS OF SURPLUS PROPERTY OFFERED FOR SALE BY THE GOVERNMENT. THE INSTRUCTIONS ADVISED BIDDERS THAT UNIT PRICES MUST BE INDICATED ON THE BID CARDS AND THAT AWARDS WOULD NOT BE MADE ON A LOT BASIS, UNLESS THE ITEM WAS OFFERED FOR SALE AS A LOT. ALSO, IN THE SCHEDULE, WHEREIN THE ARTICLES OFFERED FOR SALE WERE DESCRIBED AND THE QUANTITIES GIVEN, THERE WERE OPPOSITE EACH ITEM THE WORDS ,INDICATE BID IN UNIT OF EACH.'

IN RESPONSE TO THE INVITATION JOHN H. MCDUFFIE SUBMITTED A BID ON, AMONG OTHERS, ITEM 75 COVERING FOUR BOOMS, CRANE, TRACTOR, IN THE AMOUNT OF $169. MR. MCDUFFIE'S BID ON ITEM 75, WHICH WAS CONSIDERED AS BEING A UNIT PRICE FOR EACH BOOM AND ON SEVERAL OTHER ITEMS, BEING THE HIGHEST RECEIVED, WAS ACCEPTED ON OCTOBER 5, 1956, BY CONTRACT NO. O.I. 2986.

BY LETTER DATED OCTOBER 12, 1956, MR. MCDUFFIE ADVISED THAT THE NOTICE OF AWARD SHOWED THE PRICE OF ITEM 75 WAS $676 FOR THE FOUR BOOMS OR $169 EACH, WHEREAS HIS BID WAS INTENDED AS $169 FOR THE FOUR BOOMS OR $42.25 EACH. HE REQUESTED THAT THE AWARD AS TO THAT ITEM BE CANCELED OR THAT THE PRICE BE MODIFIED IN ACCORDANCE WITH HIS INTENDED BID. IN A LETTER DATED OCTOBER 26, 1956, MR. MCDUFFIE STATED THAT THE FIGURE 4 IN THE QUANTITY COLUMN WAS OBSCURE AND THAT WAS THE REASON FOR THE BID BEING ON A LOT BASIS RATHER THAN ON A UNIT BASIS.

THE PRIMARY QUESTION INVOLVED IS NOT WHETHER AN ERROR WAS MADE IN THE BID, BUT WHETHER A VALID AND BINDING CONTRACT WAS CONSUMMATED BY THE ACCEPTANCE THEREOF. ALTHOUGH AN EXAMINATION OF THE INVITATION DOES SHOW THAT ON ITEM 75 THE FIGURE 4 APPEARING IN THE QUANTITY COLUMN MAY BE SOMEWHAT OBSCURE, IT STILL CAN BE SEEN. ALSO, IT APPEARS THAT MR. MCDUFFIE WAS FULLY AWARE THAT THERE WERE FOUR BOOMS INVOLVED. FURTHERMORE, ALONGSIDE EACH OF THE ITEMS NUMBERED 73 THROUGH 77, WHICH WERE ON PAGE 25 OF THE SCHEDULE, THERE ARE THE WORDS "INDICATE BID IN UNIT OF EACH.' IT APPEARS FROM THE WORKSHEET SUBMITTED BY MR. MCDUFFIE WITH HIS LETTER OF OCTOBER 26, 1956, THAT HIS BID ON ITEM 76 INVOLVING TWO UNITS WAS ENTERED THEREON IN THE SAME MANNER AS ITEM 75 AND NO OBJECTION WAS MADE BY HIM AS TO THAT ITEM UPON RECEIPT OF THE NOTICE OF AWARD. THUS, IT MUST BE HELD THAT THE INVITATION REQUIRED BIDS ON A UNIT PRICE BASIS AND THAT THERE WERE FOUR UNITS INVOLVED ON ITEM 75.

IT IS REPORTED THAT THE CONTRACTING OFFICER WAS NOT ON NOTICE OF THE PROBABILITY OF ERROR IN THE BID AT THE TIME OF ACCEPTANCE THEREOF. TABULATION OF THE BIDS RECEIVED SHOWS THAT THE NEXT HIGHEST BID ON ITEM 75WAS $78.88 EACH. CONSIDERING THAT THE BOOMS WERE USED PROPERTY AND THAT THEY HAD AN ACQUISITION COST OF $686 EACH, IT IS NOT UNREASONABLE TO BELIEVE THAT A PURCHASER WOULD BE WILLING TO PAY $169 EACH FOR THE BOOMS. A WIDE VARIANCE IN THE BIDS IS NOT UNUSUAL IN THE SALE OF USED PROPERTY. THUS, THERE APPEARS TO HAVE BEEN NOTHING ON THE FACE OF THE BID, OR IN THE ATTENDANT CIRCUMSTANCES, OF A SUFFICIENT NATURE TO CHARGE A CONTRACTING OFFICER WITH CONSTRUCTIVE NOTICE OF THE PROBABILITY OF AN ERROR. THE RECORD INDICATES THAT THE ACCEPTANCE OF THE BID WAS IN GOOD FAITH, NO ERROR HAVING BEEN ALLEGED UNTIL AFTER AWARD. THE ACCEPTANCE OF THE BID, UNDER THE CIRCUMSTANCES INVOLVED, CONSUMMATED A VALID AND BINDING CONTRACT WHICH FIXED THE RIGHTS AND LIABILITIES OF THE PARTIES THERETO. ANY ERROR THAT MAY HAVE BEEN MADE IN THE BID ON ITEM 75 WAS UNILATERAL--- NOT MUTUAL --- AND, THEREFORE, AFFORDS NO BASIS FOR GRANTING RELIEF TO THE CONTRACTOR. SEE OGDEN AND DOUGHERTY V. UNITED STATES, 102 C.CLS. 249, 259 AND SALIGMAN ET L., V. UNITED STATES, 56 F.SUPP. 505, 507.

ACCORDINGLY, THERE IS NO LEGAL BASIS FOR MODIFYING THE PRICE OF ITEM 75 OR FOR RELIEVING MR. MCDUFFIE FROM LIABILITY UNDER THE TERMS OF CONTRACT NO. O.I. 2986, WHICH IS IN ACCORDANCE WITH HIS ACCEPTED BID.

THE PAPERS SUBMITTED WITH THE LETTER OF DECEMBER 27, 1956, ARE RETURNED HEREWITH.