B-131847, JUL. 10, 1957

B-131847, JUL. 10, 1957

TO CORKRAN, HILL AND COMPANY:

REFERENCE IS MADE TO YOUR LETTER OF APRIL 29, 1957, REQUESTING REVIEW OF THAT PART OF SETTLEMENT DATED MARCH 18, 1957, WHICH DISALLOWED $413.56 OF THE AMOUNT OF $616.59 STATED TO BE DUE BY REASON OF AN ERROR ALLEGED TO HAVE BEEN MADE IN YOUR BID ON WHICH UNNUMBERED CONTRACT DATED NOVEMBER 19, 1956, WAS BASED.

BY INVITATION NO. 57-76 THE VETERANS ADMINISTRATION HOSPITAL, PERRY POINT, MARYLAND, REQUESTED BIDS--- TO BE OPENED NOVEMBER 14, 1956--- FOR FURNISHING, AMONG OTHER ITEMS, ITEM 67-A, 1,520 POUNDS OF FROZEN PRECOOKED SAUSAGE. YOU SUBMITTED A BID OFFERING TO FURNISH THE DESIRED QUANTITY FOR $4.65 PER CASE OF "12 1/2 POUND PKGS.' THE BID ON THIS ITEM WAS ACCEPTED AND PURCHASE ORDER NO. 1263 WAS ISSUED, REFLECTING A PRICE OF $0.372 PER POUND BASED ON YOUR BID OF $4.65 PER CASE CONSISTING OF 12 1/2 POUND PACKAGES. BY TELEPHONE ON NOVEMBER 20, 1956, YOU ADVISED THE CONTRACTING OFFICER THAT THE PRICE ON THE ITEM INVOLVED WAS IN ERROR IN THAT THE PRICE OF $4.65 WAS BASED ON A CASE CONSISTING OF 12 ONE-HALF POUND PACKAGES, WHICH WOULD RESULT IN A COMPUTED COST OF $0.775 PER POUND. BY LETTER OF NOVEMBER 21, 1956, YOU WERE ADVISED THAT, SINCE TIME FOR DELIVERY WOULD NOT PERMIT DELAY INCIDENT TO RESOLVING THE MATTER OF THE ALLEGED MISTAKE, YOU SHOULD PERFORM IN ACCORDANCE WITH THE TERMS OF THE CONTRACT AND SHOULD SUBMIT THE CLAIMS, ONE AT THE BID PRICE AND ONE AT THE DIFFERENCE BETWEEN THE BID PRICE AND THAT PRICE WHICH YOU ALLEGEDLY INTENDED TO BID. YOUR CLAIM FOR THE AMOUNT OF $413.56 ALLEGED TO BE DUE WAS CONSIDERED IN THE SETTLEMENT OF MARCH 18, 1957, AND WAS DISALLOWED FOR THE REASONS STATED.

YOU STATE IN YOUR LETTER OF APRIL 29, 1957, THAT YOU BELIEVE THAT THE RESPONSIBILITY FOR THE MISTAKE LIES WITH THE VETERANS ADMINISTRATION HOSPITAL IN THE WAY THE PRICE WAS REFIGURED TO A PER POUND BASIS AND THE FACT THAT THE CONTRACTING OFFICER MADE NO EFFORT TO CHANGE THE AWARD WHEN NOTIFIED OF THE ERROR ON YOUR PART.

THE INVITATION REQUESTED BIDS ON A POUND BASIS. YOU DID NOT BID AS REQUESTED, BUT BID $4.65 PER CASE OF "12 1/2 POUND PKGS.' NATURALLY THE CONTRACTING OFFICER IN ORDER TO BE ABLE TO COMPARE YOUR BID WITH THE OTHER BIDS RECEIVED HAD TO REDUCE YOUR BID TO A POUND BASIS. YOU ADMIT IN YOUR LETTER OF NOVEMBER 26, 1956, TO THE HOSPITAL THAT THE "ERROR IN THE DESCRIPTIVE MATTER WITH REFERENCE TO THE PACKAGING WAS IN THE STENOGRAPHIC TRANSCRIPTION.' HAD YOU MADE IT CLEAR THAT YOUR BID OF $4.65 WAS FOR A CASE THAT CONSISTED OF 12 ONE-HALF POUND PACKAGES THEN THE CONTRACTING OFFICER READILY COULD HAVE SEEN YOUR BID WOULD RESULT IN A COMPUTED COST OF $0.775 PER POUND, WHICH BEING THE HIGHEST BID WOULD HAVE RECEIVED NO FURTHER CONSIDERATION.

WITH RESPECT YOUR STATEMENT THAT THE CONTRACTING OFFICER MADE NO EFFORT TO CHANGE THE AWARD WHEN NOTIFIED OF THE ERROR, YOU ARE ADVISED THAT A CONTRACTING OFFICER HAS NO AUTHORITY TO CHANGE THE PRICE OF AN ITEM ON WHICH AN ERROR IS ALLEGED AFTER THE AWARD HAS BEEN MADE BUT THE MATTER IN MOST CASES MUST BE SUBMITTED TO OUR OFFICE FOR HANDLING. IF THE CONTRACTING OFFICER HAD SUBMITTED THE MATTER HERE THE ANSWER WOULD HAVE BEEN THE SAME AS NOW.

IN THE SETTLEMENT OF MARCH 18, 1957, YOU WERE ALLOWED THE DIFFERENCE BETWEEN THE AMOUNT PREVIOUSLY PAID YOU AND THE AMOUNT OF THE LOWEST CORRECT BID, ON THE THEORY THAT THE WIDE VARIANCE BETWEEN THE AMOUNT OF YOUR BID AND THE OTHER BIDS RECEIVED WAS DEEMED SUFFICIENT TO HAVE PUT THE CONTRACTING OFFICER ON NOTICE OF THE PROBABLE EXISTENCE OF AN ERROR IN YOUR BID SO AS TO HAVE WARRANTED HIS REQUESTING A VERIFICATION OF THE BID PRIOR TO ITS ACCEPTANCE.

IN ANY EVENT THE FACT REMAINS THAT HAD IT NOT BEEN FOR YOUR NEGLIGENCE IN SUBMITTING AN ERRONEOUS BID, THE CONTRACTING OFFICER WOULD HAVE ACCEPTED THE LOWEST CORRECT BID AND THE RESULTANT CONTRACT WOULD HAVE BEEN ON THAT BASIS. CERTAINLY, THE GOVERNMENT IS NOT TO BE PENALIZED BY REASON OF YOUR CARELESSNESS IN THE PREPARATION OF YOUR BID. THE GOVERNMENT HAS FULLY DISCHARGED ITS OBLIGATION IN THE MATTER BY THE PAYMENT TO YOU OF THE LOWEST CORRECT BID PRICE. THERE ARE NO LEGAL OR EQUITABLE GROUNDS FOR PAYMENT OF ANY ADDITIONAL AMOUNT.