B-130547, APR. 25, 1957

B-130547: Apr 25, 1957

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DOLINE: FURTHER REFERENCE IS MADE TO YOUR LETTER OF JANUARY 28. WHEREIN YOU ALLEGE THAT AN ERROR WAS MADE IN YOUR BID ON WHICH CONTRACT NO. GS-13S-19009 WAS AWARDED. YOU WERE REQUESTED BY OUR OFFICE TO FURNISH CERTAIN EVIDENCE IN SUPPORT OF YOUR REQUEST FOR AN INCREASE IN THE CONTRACT PRICES OF FUEL OIL AND KEROSENE FURNISHED UNDER THE CONTRACT. TO DATE YOU HAVE NOT FURNISHED SUCH EVIDENCE. THE MATTER WILL BE CONSIDERED ON THE BASIS OF THE FACTS AS STATED IN YOUR LETTER AND IN THE ADMINISTRATIVE REPORT. YOU WERE REQUESTED TO FURNISH THE NAME OF THE MARKETING COMPANY OR JOURNAL. WHICH WAS RECEIVED ON JUNE 10. 157 WAS ACCEPTED. THE POSTED TANK WAGON PRICES ON KEROSENE AND NO. 2 BURNER OIL WERE BEING INCREASED TO $0.155 PER GALLON AND $0.143 PER GALLON.

B-130547, APR. 25, 1957

TO MR. PHILIP T. DOLINE:

FURTHER REFERENCE IS MADE TO YOUR LETTER OF JANUARY 28, 1957, WITH ENCLOSURE, WHEREIN YOU ALLEGE THAT AN ERROR WAS MADE IN YOUR BID ON WHICH CONTRACT NO. GS-13S-19009 WAS AWARDED.

BY LETTERS DATED FEBRUARY 7 AND MARCH 20, 1957, YOU WERE REQUESTED BY OUR OFFICE TO FURNISH CERTAIN EVIDENCE IN SUPPORT OF YOUR REQUEST FOR AN INCREASE IN THE CONTRACT PRICES OF FUEL OIL AND KEROSENE FURNISHED UNDER THE CONTRACT. TO DATE YOU HAVE NOT FURNISHED SUCH EVIDENCE. SINCE IT APPEARS THAT YOU DO NOT INTEND TO FURNISH THE REQUESTED EVIDENCE. THE MATTER WILL BE CONSIDERED ON THE BASIS OF THE FACTS AS STATED IN YOUR LETTER AND IN THE ADMINISTRATIVE REPORT.

THE FEDERAL SUPPLY SERVICE, REGION 3, WASHINGTON, D.C., BY INVITATION DATED APRIL 19, 1956, REQUESTED BIDS--- TO BE OPENED MAY 10, 1956--- FOR FURNISHING FUEL OIL AND KEROSENE, CLASS 7, AND SOLVENTS, CLASS 51, AS REQUIRED BY VARIOUS GOVERNMENT AGENCIES DURING THE PERIOD BEGINNING AUGUST 1, 1956, AND ENDING JULY 31, 1957. THE INVITATION PROVIDED, IN EFFECT, THAT BIDS SHOULD BE BASED ON AN ESCALATING REFERENCED PRICE AS LISTED IN A RECOGNIZED TRADE PUBLICATION TO BE SELECTED BY THE BIDDER AND THAT THE PUBLISHED PRICE FOR EACH ITEM CONCERNED FOR MAY 6, 1956, SHOULD BE USED FOR BIDDING PURPOSES. THE INVITATION FURTHER PROVIDED FOR THE BIDDER TO INDICATE A DIFFERENTIAL, IF ANY, PER GALLON, TO BE DEDUCTED FROM OR ADDED TO THE ESCALATING REFERENCED PRICE AND FOR THE BIDDER TO QUOTE A MAXIMUM PRICE PAYABLE FOR THE ITEM, PER GALLON, IF ANY.

IN RESPONSE TO THE INVITATION, YOU SUBMITTED A BID DATED MAY 8, 1956, OFFERING TO FURNISH FUEL OIL AND KEROSENE AT THE PRICES STATED OPPOSITE EACH ITEM. IN A LETTER DATED JUNE 7, 1956, YOU WERE REQUESTED TO FURNISH THE NAME OF THE MARKETING COMPANY OR JOURNAL, TYPE OF DELIVERY, AND DATE ON WHICH YOU BASED YOUR REFERENCE PRICE AS REQUIRED BY PARAGRAPH 3, PAGE 3 OF THE INVITATION; AND BY A LETTER, WHICH WAS RECEIVED ON JUNE 10, 1956, YOU FURNISHED THE REQUIRED INFORMATION. ON JUNE 19, 1956, YOUR BID FOR FURNISHING FUEL OIL AND KEROSENE UNDER ITEMS 69, 125, 126, 127, 129, 130, 147, 148, AND 157 WAS ACCEPTED.

BY TELEGRAM DATED OCTOBER 2, 1956, YOU ADVISED THE FEDERAL SUPPLY SERVICE THAT, EFFECTIVE THAT DAY, THE POSTED TANK WAGON PRICES ON KEROSENE AND NO. 2 BURNER OIL WERE BEING INCREASED TO $0.155 PER GALLON AND $0.143 PER GALLON, RESPECTIVELY; AND ON JANUARY 10, 1957, YOU ADVISED THE FEDERAL SUPPLY SERVICE OF ANOTHER INCREASE IN THE POSTED TANK WAGON PRICES ON KEROSENE AND FUEL OIL. IN A LETTER DATED JANUARY 14, 1957, ADDRESSED TO THE FEDERAL SUPPLY SERVICE, YOU REQUESTED A RETROACTIVE INCREASE TO COVER YOUR INCREASE IN POSTED TANK WAGON PRICES OF THE FUEL OIL AND KEROSENE DELIVERED UNDER THE CONTRACT--- THE BASIS THEREFOR BEING THAT BECAUSE OF THE INCREASE IN COSTS OF FUEL OIL AND KEROSENE, IT WOULD BE IMPOSSIBLE FOR YOU TO DELIVER THESE ITEMS AT A PRICE LOWER THAN THE COST TO YOU. LETTER DATED JANUARY 30, 1957, THE FEDERAL SUPPLY SERVICE ADVISED YOU THAT IT WAS WITHOUT LEGAL AUTHORITY TO MAKE AN ADJUSTMENT IN THE MAXIMUM PRICES OF THE KEROSENE AND FUEL OIL DELIVERED UNDER THE CONTRACT.

IN YOUR LETTER DATED JANUARY 28, 1957, TO OUR OFFICE, YOU REQUESTED THAT THE CONTRACT PRICES OF ITEMS 69, 125, 126, 127, 129, 130, 147, 148, AND 157 BE ADJUSTED RETROACTIVELY SO AS TO ENABLE YOU TO RECEIVE A FAIR MARGIN OF PROFIT. WITH YOUR LETTER YOU SUBMITTED A TYPEWRITTEN SCHEDULE, WHICH PURPORTS TO SHOW THAT THE GOVERNMENT IS RECEIVING KEROSENE AND FUEL OIL AT PRICES BELOW YOUR COST. ALSO, IN YOUR LETTER YOU ALLEGE THAT AT THE TIME YOU RECEIVED THE COPY OF THE INVITATION YOU DID NOT RECEIVE A "SUPPLEMENT" TO THE INVITATION AND THAT INASMUCH AS THIS WAS YOUR FIRST BID, IT WAS YOUR INTERPRETATION THAT "THE MAXIMUM PRICE WAS THAT AT THE TIME OF THE QUOTATION.' IN ITS REPORT THE FEDERAL SUPPLY SERVICE STATES THAT THE SUPPLEMENT YOU ARE REFERRING TO APPEARS TO BE A COPY OF THE SPECIAL PROVISIONS FOR BULK AND DRUM DELIVERIES OF GASOLINE, FUEL OILS, THAT IT IS NOT THE POLICY OF THE AGENCY TO ATTACH A COPY OF THE SPECIAL PROVISIONS TO THE BID INVITATION BECAUSE OF THE COST INVOLVED, BECAUSE THE MAJORITY OF BIDDERS HAVE OBTAINED COPIES ON PREVIOUS INVITATIONS, AND BECAUSE THE INVITATION SPECIFICALLY PROVIDES ON PAGE 3 THEREOF A SOURCE FROM WHICH ADDITIONAL INFORMATION OR ASSISTANCE MAY BE OBTAINED. THE SPECIAL PROVISIONS WERE REFERRED TO IN PARAGRAPHS NOS. 1 AND 3, PAGE 3 OF THE INVITATION. PARAGRAPH 1 INCORPORATES BY REFERENCE THE SPECIAL PROVISIONS AND PARAGRAPH 3 SUPPLEMENTS PARAGRAPH 8, PRICES, OF THESE SPECIAL PROVISIONS. IN REGARD TO THE FAILURE OF THE FEDERAL SUPPLY SERVICE TO FURNISH YOU A COPY OF THE SPECIAL PROVISIONS WITH THE INVITATION, YOUR ATTENTION IS INVITED TO 20 COMP. GEN. 652, WHEREIN IT WAS HELD (QUOTING THE SYLLABUS):

"A BIDDER MAY NOT BE RELIEVED OF ITS LIABILITY UNDER A BID ACCEPTED IN GOOD FAITH AND WITHOUT NOTICE OF ERROR, WHERE THE MISTAKE IN BID RESULTED FROM THE BIDDER'S NEGLIGENCE IN FAILING TO ASCERTAIN THE REQUIREMENTS OF THE SPECIFICATIONS REFERRED TO BUT NOT FURNISHED WITH THE INVITATION FOR BIDS.'

THE SUBMISSION OF A BID IN RESPONSE TO THE INVITATION IN THIS CASE WAS, OF COURSE, VOLUNTARY. THE RESPONSIBILITY FOR THE PREPARATION OF THE BID TO CONFORM TO THE SPECIFICATIONS IN ALL OF ITS PHASES RESTED UPON YOU. SEE FRAZIER-DAVIS CONSTRUCTION CO. V. UNITED STATES, 100 C.CLS. 120, 163. AS STATED IN THE CASE OF GRYMES V. SANDERS ET AL., 93 U.S. 55,"MISTAKE, TO BE AVAILABLE IN EQUITY, MUST NOT HAVE ARISEN FROM NEGLIGENCE, WHERE THE MEANS OF KNOWLEDGE WERE EASILY ESSIBLE.' IT IS CLEAR THAT SUCH ERROR AS WAS MADE IN YOUR BID WAS DUE TO YOUR FAILURE TO OBTAIN A COPY OF THE REFERRED TO SPECIAL PROVISIONS, WHICH WOULD HAVE DISCLOSED TO YOU THE PERIOD DURING WHICH THE MAXIMUM PRICES QUOTED WERE TO BE IN EFFECT. ANY ERROR THAT WAS MADE IN YOUR BID WAS UNILATERAL--- NOT MUTUAL--- AND, THEREFORE, DOES NOT ENTITLE YOU TO RELIEF. SEE SALIGMAN ET AL. V. UNITED STATES, 56 F.SUPP. 505, 507; AND OGDEN AND DOGHERTY V. UNITED STATES, 102 C.CLS. 249. ALSO, SEE 27 COMP. GEN. 718.

THERE WAS NOTHING ON THE FACE OF YOUR BID TO INDICATE AN ERROR THEREIN. THE CONTRACTING OFFICER HAS REPORTED THAT HE HAD NO REASON TO SUSPECT AN ERROR IN YOUR BID PRIOR TO AWARD SINCE THE BID PRICES QUOTED BY TWO OTHER BIDDERS WERE CLOSELY COMPETITIVE WITH THE PRICES QUOTED BY YOU. IT IS NOTED FROM THE ABSTRACT OF BIDS THAT THE NEXT LOWEST BIDDER USED A PROCEDURE IDENTICAL TO THAT USED BY YOU TO ARRIVE AT THE MAXIMUM PRICE PER GALLON, NAMELY, THE AMOUNT TO BE DEDUCTED FROM THE POSTED PRICE WAS SUBTRACTED FROM THE POSTED PRICE ON DATE OF BID. THE PRESENT RECORD INDICATES THAT THE ACCEPTANCE OF YOUR BID WAS IN GOOD FAITH, NO ERROR HAVING BEEN ALLEGED UNTIL AFTER AWARD, AND NO GROUND BEING FOUND FOR CHARGING THE CONTRACTING OFFICER WITH NOTICE OF POSSIBLE ERROR. IN THESE CIRCUMSTANCES A COMPLETE, VALID AND ENFORCEABLE CONTRACT CAME INTO BEING UPON ACCEPTANCE OF THE BID AND SUCH CONTRACT FIXED THE RIGHTS AND LIABILITIES OF THE PARTIES THERETO. SEE UNITED STATES V. PURCELL ENVELOPE CO., 249 U.S. 313; AND AMERICAN SMELTING AND REFINING CO. V. UNITED STATES, 259 U.S. 75.

ACCORDINGLY, ON THE BASIS OF THE PRESENT RECORD, THERE APPEARS TO BE NO LEGAL BASIS FOR MODIFYING THE PRICES SPECIFIED IN CONTRACT NO. GS-13S- 19009. WE HAVE NO LEGAL AUTHORITY TO RELIEVE CONTRACTORS FROM THE CONSEQUENCES OF AN ERRONEOUS BID, AFTER ACCEPTANCE, UNLESS THE ACCEPTANCE OF THE BID WAS UNDER SUCH CIRCUMSTANCES AS WOULD JUSTIFY THE IMPUTATION OF BAD FAITH TO THE OFFICER ACCEPTING IT. ..END :