B-132102, JUN. 19, 1957

B-132102: Jun 19, 1957

Additional Materials:

Contact:

Edda Emmanuelli Perez
(202) 512-2853
EmmanuelliPerezE@gao.gov

 

Office of Public Affairs
(202) 512-4800
youngc1@gao.gov

TO THE SECRETARY OF THE ARMY: REFERENCE IS MADE TO YOUR LETTER OF JUNE 4. WAS REQUESTED TO VERIFY ITS BID AND THAT BY LETTER DATED MARCH 9. THE COMPANY STATED THAT IT WOULD LIKE TO WITHDRAW ITS BID AS IT HAD NO WORKSHEETS OR OTHER DATA TO SHOW HOW THE ERROR WAS MADE. WHICH IS IN AFFIDAVIT FORM. TOGETHER WITH THE AFFIDAVIT AND PERTINENT PRICE LISTS SUBMITTED ESTABLISH THAT THE MANUFACTURER'S LIST PRICE WAS $1. THAT THE LIST PRICES FOR STAINLESS STEEL TOP AND BACK WERE $98 AND $164 ADDITIONAL. THAT THE SLIDES WERE $132 ADDITIONAL FOR EACH FULL SECTION. THAT THE PRICE OF THE COMPRESSOR WAS $173.21. THE NOTED DISPARITY BETWEEN ITS BID AND THE OTHER BIDS SUFFICIENTLY WARRANTS THE CONCLUSION THAT SUCH A BONA FIDE MISTAKE WAS MADE AS TO AUTHORIZE THE WITHDRAWAL OF ITS BID.

B-132102, JUN. 19, 1957

TO THE SECRETARY OF THE ARMY:

REFERENCE IS MADE TO YOUR LETTER OF JUNE 4, 1957, WITH ENCLOSURES, REQUESTING A DECISION AS TO THE ACTION TO BE TAKEN CONCERNING AN ERROR THE COMMERCE REFRIGERATION AND SUPPLY CO., SAN ANTONIO, TEXAS, ALLEGES IT MADE IN ITS BID SUBMITTED IN RESPONSE TO INVITATION NO. QM-41-187-57 57, ISSUED JANUARY 31, 1957, AND AMENDED FEBRUARY 11, 1957.

THE INVITATION REQUESTED BIDS--- TO BE OPENED MARCH 5, 1957--- FOR FURNISHING F.O.B. DESTINATION TWO REFRIGERATORS, KOCH FOOD FILE MODEL 2870, OR EQUAL, MECHANICAL, 70 CUBIC FEET, REACH-IN TYPE, STAINLESS STEEL FINISH COVERING OUTSIDE, INCLUDING DOORS, FRONT, SIDES, TOP AND BACK AND INTERIOR WALLS, BACK, TOP, DOORS AND BOTTOM, WITH INSERTS OF ANODIZED ALUMINUM, HAVING EXTRUDED SLIDES ON 2-INCH CENTERS, SLIDES TO GUIDE AND SUPPORT TRAYS, AFFORDING 14 POSITIONS BEHIND EACH DOOR. IN RESPONSE, THE COMMERCE REFRIGERATION AND SUPPLY CO. SUBMITTED A BID DATED MARCH 1, 1957, OFFERING TO FURNISH THE REFRIGERATORS AT A PRICE OF $1,145 EACH. THE SIX OTHER RESPONSIVE BIDS RANGED FROM $1,429 TO $1,619.84.

IN HIS UNDATED REPORT THE CONTRACTING OFFICER STATES THAT, BECAUSE OF THE DIFFERENCE IN PRICE, THE COMMERCE REFRIGERATION AND SUPPLY CO. WAS REQUESTED TO VERIFY ITS BID AND THAT BY LETTER DATED MARCH 9, 1957, THE COMPANY ADVISED THAT IT HAD MADE AN ERROR IN ITS FIGURES AND THAT IT WOULD LIKE TO RAISE ITS BID PRICE TO $1,391 EACH. IN RESPONSE TO A REQUEST FOR EVIDENCE IN SUPPORT OF THE ERROR, THE COMPANY STATED THAT IT WOULD LIKE TO WITHDRAW ITS BID AS IT HAD NO WORKSHEETS OR OTHER DATA TO SHOW HOW THE ERROR WAS MADE. SINCE THE COMPANY FAILED TO FURNISH EVIDENCE IN SUPPORT OF THE ALLEGED ERROR, THE CONTRACTING OFFICER AWARDED A CONTRACT TO THEM ON APRIL 5, 1957.

BY LETTER OF APRIL 8, 1957, THE COMPANY'S ATTORNEY PROTESTED THE ACTION TAKEN BY THE CONTRACTING OFFICER AND DENIED ANY LIABILITY UNDER THE ORIGINAL BID, STATING THAT THE COST OF THE SLIDES HAD BEEN OMITTED FROM THE BID. SUBSEQUENTLY, IN A LETTER DATED APRIL 24, 1957, WHICH IS IN AFFIDAVIT FORM, THE OWNER OF THE COMPANY STATED THAT THE ERROR HAD BEEN CAUSED BY THE FAILURE OF THE MANUFACTURER'S AGENT TO GIVE THE COMPANY COMPLETE INFORMATION ON THE PRICE. INFORMATION CONTAINED IN THE BIDDER'S "INTERNAL CORRESPONDENCE" FORM, TOGETHER WITH THE AFFIDAVIT AND PERTINENT PRICE LISTS SUBMITTED ESTABLISH THAT THE MANUFACTURER'S LIST PRICE WAS $1,782; THAT THE LIST PRICES FOR STAINLESS STEEL TOP AND BACK WERE $98 AND $164 ADDITIONAL, RESPECTIVELY; THAT THE SLIDES WERE $132 ADDITIONAL FOR EACH FULL SECTION, OR $396 FOR EACH UNIT FOR A TOTAL OF $2,440 FOR THE REFRIGERATOR AND ACCESSORIES; AND THAT THE PRICE OF THE COMPRESSOR WAS $173.21. APPLYING THE TRADE DISCOUNTS OF 50 PERCENT AND 10 PERCENT TO THE TOTAL LIST PRICE FOR THE REFRIGERATOR AND ACCESSORIES AND ADDING THE COMPRESSOR COST RESULTS IN A PRICE TO THE DISTRIBUTOR, NOT INCLUDING FREIGHT, OF $1,271.21, OR $126.21 MORE THAN THE AMOUNT OF THE BID.

ALTHOUGH THE COMPANY FURNISHED NO EVIDENCE IN SUPPORT OF ITS ALLEGATION OF ERROR WHEN REQUESTED TO DO SO, THE NOTED DISPARITY BETWEEN ITS BID AND THE OTHER BIDS SUFFICIENTLY WARRANTS THE CONCLUSION THAT SUCH A BONA FIDE MISTAKE WAS MADE AS TO AUTHORIZE THE WITHDRAWAL OF ITS BID. ACCORDINGLY, AND SINCE THE BIDDER DID IN FACT REQUEST PERMISSION TO WITHDRAW ITS BID PRIOR TO AWARD, THE CONTRACT INVOLVED MAY BE CANCELED WITHOUT LIABILITY TO THE COMPANY, AS RECOMMENDED BY THE CONTRACTING OFFICER.

A DUPLICATE SET OF THE PAPERS IN THE CASE IS BEING RETAINED. THE OTHER PAPERS ARE RETURNED.