B-131636, MAY 28, 1957

B-131636: May 28, 1957

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TO THE SECRETARY OF THE NAVY: REFERENCE IS MADE TO LETTER DATED APRIL 23. ALLEGES IT MADE IN ITS BID ON WHICH SALES CONTRACT N-62782-212 IS BASED. ITEM 3 IS DESCRIBED AS A SLOTTER IN "USED-GOOD" CONDITION ORIGINALLY ACQUIRED AT A COST OF $21. ITEM 4 IS DESCRIBED AS A BORING AND TURNING MILL IN "USED-FAIR" CONDITION ORIGINALLY ACQUIRED AT A COST OF $21. ITEM 3 WAS AWARDED TO S AND S MACHINERY COMPANY AT ITS BID PRICE OF $7. THE PURCHASER ALLEGED AN ERROR IN BID IN THAT THE BID ENTERED OPPOSITE ITEM 3 WAS INTENDED FOR ITEM 4. 2 AND 3 CORROBORATE THE STATEMENT OF THE PURCHASER THAT ITS BID ON ITEM 3 WAS ERRONEOUS. 558.88 AND MORE PARTICULARLY THE FOUR OTHER BIDS ON ITEM 3 WERE $500. ALTHOUGH THERE IS A WIDE VARIANCE BETWEEN THE BID OF THE PURCHASER AND THE OTHER BIDDERS AND THE CONTRACTING OFFICER NOW RECOGNIZES AN ERROR IN VIEW OF THE EVIDENCE WHICH THE PURCHASER HAS PRESENTED BUT WHICH EVIDENCE WAS OUTSIDE THE CONTRACTING OFFICER'S KNOWLEDGE PRIOR TO AWARD.

B-131636, MAY 28, 1957

TO THE SECRETARY OF THE NAVY:

REFERENCE IS MADE TO LETTER DATED APRIL 23, 1957, WITH ENCLOSURES, FROM THE ACTING CHIEF OF NAVAL MATERIAL, WHO REQUESTS A DECISION REGARDING AN ERROR S AND S MACHINERY COMPANY, BROOKLYN, NEW YORK, ALLEGES IT MADE IN ITS BID ON WHICH SALES CONTRACT N-62782-212 IS BASED.

INVITATION NO. B-6-57-62782, DATED FEBRUARY 8, 1957, REQUESTED BIDS FOR THE PURCHASE FROM THE GOVERNMENT OF MACHINE TOOLS, SHOP EQUIPMENT, PUMPS AND CRANES LISTED UNDER ITEMS 1 TO 14, INCLUSIVE. ITEM 3 IS DESCRIBED AS A SLOTTER IN "USED-GOOD" CONDITION ORIGINALLY ACQUIRED AT A COST OF $21,955. ITEM 4 IS DESCRIBED AS A BORING AND TURNING MILL IN "USED-FAIR" CONDITION ORIGINALLY ACQUIRED AT A COST OF $21,000. ITEM 3 WAS AWARDED TO S AND S MACHINERY COMPANY AT ITS BID PRICE OF $7,500.

AFTER AWARD, THE PURCHASER ALLEGED AN ERROR IN BID IN THAT THE BID ENTERED OPPOSITE ITEM 3 WAS INTENDED FOR ITEM 4. TO SUBSTANTIATE THE CLAIM OF ERROR, THE PURCHASER FURNISHED A PHOTOSTATIC COPY OF ITS WORKSHEET.

IN HIS REPORT RECOMMENDING RELIEF FOR THE PURCHASER, THE CONTRACTING OFFICER STATES THAT THE OTHER BIDS RECEIVED FOR SLOTTERS ADVERTISED UNDER ITEMS 1, 2 AND 3 CORROBORATE THE STATEMENT OF THE PURCHASER THAT ITS BID ON ITEM 3 WAS ERRONEOUS. HOWEVER, THE OTHER BIDS ON THOSE ITEMS RANGED IN PRICE FROM $405 TO $2,558.88 AND MORE PARTICULARLY THE FOUR OTHER BIDS ON ITEM 3 WERE $500, $777.77, $1,300, AND $2,558.88. THEREFORE, ALTHOUGH THERE IS A WIDE VARIANCE BETWEEN THE BID OF THE PURCHASER AND THE OTHER BIDDERS AND THE CONTRACTING OFFICER NOW RECOGNIZES AN ERROR IN VIEW OF THE EVIDENCE WHICH THE PURCHASER HAS PRESENTED BUT WHICH EVIDENCE WAS OUTSIDE THE CONTRACTING OFFICER'S KNOWLEDGE PRIOR TO AWARD, IT DOES NOT APPEAR THAT PRIOR TO AWARD HE WAS PLACED ON NOTICE OF THE POSSIBILITY OF ERROR IN THE BID AND THAT HE SHOULD HAVE REQUESTED THE BIDDER TO VERIFY ITS BID. IN VIEW OF THE WIDE RANGE OF PRICES ORDINARILY RECEIVED ON SURPLUS, SALVAGE AND WASTE PROPERTY, A MERE PRICE DIFFERENCE WOULD NOT NECESSARILY PLACE A CONTRACTING OFFICER ON NOTICE OF THE PROBABILITY OF ERROR, AS WOULD SIMILAR PRICE DIFFERENCES ON NEW EQUIPMENT TO BE FURNISHED TO THE GOVERNMENT. PRICES OFFERED TO THE GOVERNMENT FOR ITS PROPERTY ARE BASED MORE OR LESS UPON THE USE TO WHICH THE PROPERTY IS TO BE PUT BY THE PARTICULAR BIDDER OR UPON THE RISK OF RESALE THE BIDDER MIGHT WISH TO TAKE. SEE 16 COMP. GEN. 576; 17 ID. 388; ID. 601; ID. 976; 28 ID. 261; AND ID. 550.

IN ITS EXPLANATION OF THE ERROR, THE PURCHASER ALLEGES THAT THE WORDS "FOR SALE" PRINTED DIAGONALLY ACROSS THE FACE OF THE INVITATION OBSCURED THE "1 EA.' DESIGNATION WHICH APPEARS BESIDE ITEM 4 AND AS A RESULT IT WAS LED TO BELIEVE THAT THE "1 EA.' DESIGNATION JUST ABOVE ITEM 4, WHICH DESIGNATION THE GOVERNMENT INTENDED TO APPLY TO ITEM 3, WAS INTENDED FOR ITEM 4. WHILE IT MAY BE THAT THE WORDS "FOR SALE" DID OBSCURE THE DESIGNATION "1 EA., " OPPOSITE ITEM 4, THE PURCHASER IN ITS EXAMINATION OF THE INVITATION SHOULD HAVE NOTICED THAT THE PATTERN WAS TO DESIGNATE THE QUANTITY AND UNIT OF MEASURE ON THE LAST LINE OF THE ITEM DESCRIPTION. ALSO, IT IS NOTED THAT THE DESCRIPTION OF ITEM 3 IS SEPARATED FROM THE DESCRIPTION OF ITEM 4 BY AN ADDITIONAL SPACE SO THAT THE DESIGNATION OF "1 EA.' OPPOSITE THE LAST LINE OF THE DESCRIPTION OF ITEM 3 SHOULD NOT HAVE BEEN REGARDED AS APPLYING TO ITEM 4, REGARDLESS OF THE FACT THAT THE DESIGNATION OF "1 EA.' OPPOSITE ITEM 4 IS INDISTINCT.

ALTHOUGH THE PURCHASER POINTS OUT THAT ON THE FACE OF THE BID AND TO THE LEFT OF THE DESCRIPTION OF ITEM 4 THERE APPEARS A CHECK MARK, AS WELL AS ERASURES TO THE RIGHT OF THE DESCRIPTION, THESE FACTS MAY NOT BE REGARDED AS CONSTITUTING A NOTICE TO THE DISPOSAL OFFICER OF POSSIBLE ERROR ON THE PART OF THE PURCHASER.

THE RESPONSIBILITY FOR PREPARATION OF A BID IS UPON THE BIDDER. SEE FRAZIER-DAVIS CONSTRUCTION COMPANY V. UNITED STATES, 100 C.CLS. 120, 163. SINCE THE ERROR WAS NOT ALLEGED UNTIL AFTER AWARD, THE ACCEPTANCE OF THE BID WAS MADE IN GOOD FAITH AND CONSUMMATED A VALID AND BINDING CONTRACT WHICH FIXED THE RIGHTS AND LIABILITIES 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. FURTHERMORE, IF IN THE PREPARATION OF THE BID AN ERROR WAS MADE AS ALLEGED, IT MAY BE ATTRIBUTED SOLELY TO THE PURCHASER'S NEGLIGENCE AND SINCE THE ERROR IS UNILATERAL, NOT MUTUAL, THE PURCHASER IS NOT ENTITLED TO ANY RELIEF. SEE OGDEN AND DOUGHERTY V. UNITED STATES, 102 C.CLS. 249, 259; AND SALIGMAN V. UNITED STATES, 56 F.SUPP. 505, 507.

THE PURCHASER SHOULD BE CALLED UPON TO MAKE PAYMENT OF THE BALANCE OF THE PURCHASE PRICE AND TO REMOVE THE PROPERTY FROM THE GOVERNMENT SITE. THE PURCHASER DEFAULTS IN THIS RESPECT, THE GOVERNMENT'S RIGHT TO RETAIN LIQUIDATED DAMAGES AS PROVIDED IN PARAGRAPH 18 OF THE GENERAL TERMS AND CONDITIONS OF THE SALE SHOULD BE EXERCISED.