B-134065, OCT. 21, 1957

B-134065: Oct 21, 1957

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TO THE SECRETARY OF THE ARMY: REFERENCE IS MADE TO LETTER DATED OCTOBER 9. ALLEGES IT MADE IN ITS PRICE QUOTATION ON WHICH PURCHASE ORDER NO. 57-A5813 IS BASED. PURCHASE ORDER NO. 57-A5813 WAS ISSUED IN ACCORDANCE WITH THE LETTER QUOTATIONS. THE MOTOR WAS DELIVERED. THE COMPANY CLAIMED ERROR ALLEGING THAT ITS DISCOUNT TO GOVERNMENT SPONSORED EDUCATIONAL FACILITIES FOR THE SUBJECT MOTOR IS 32 PERCENT. ALTHOUGH ORDINARILY A WIDE RANGE BETWEEN A LOW PRICE QUOTATION AND OTHER QUOTED PRICES OR BETWEEN A LOW PRICE QUOTATION AND THE GOVERNMENT ESTIMATED PRICE WILL SERVE AS AN INDICATION OF ERROR IN THE LOW QUOTATION. THE IMMEDIATE SITUATION IS SUCH THAT IT SEEMS REASONABLE TO CONCLUDE THAT THE CONTRACTING OFFICER LACKED CONSTRUCTIVE NOTICE OF ERROR.

B-134065, OCT. 21, 1957

TO THE SECRETARY OF THE ARMY:

REFERENCE IS MADE TO LETTER DATED OCTOBER 9, 1957, WITH ENCLOSURES, FROM THE DEPUTY ASSISTANT SECRETARY (LOGISTICS), WHO REQUESTS A DECISION REGARDING AN ERROR GENERAL ELECTRIC COMPANY, NEW YORK, NEW YORK, ALLEGES IT MADE IN ITS PRICE QUOTATION ON WHICH PURCHASE ORDER NO. 57-A5813 IS BASED.

IN RESPONSE TO A REQUEST FROM THE DEPARTMENT OF MECHANICS AT WEST POINT FOR A PROPOSAL ON A MULTI-SPEED INDUCTION MOTOR, GENERAL ELECTRIC COMPANY, BY LETTER DATED JANUARY 24, 1957, QUOTED A PRICE IN THE AMOUNT OF $952 LESS A 32 PERCENT DISCOUNT SUBJECT TO AN ADJUSTMENT TO THE PRICE IN EFFECT AT THE TIME OF SHIPMENT, ANY INCREASE NOT TO EXCEED 10 PERCENT OF THE QUOTED PRICE. BY LETTER DATED MARCH 11, 1957, THE COMPANY INCREASED THE DISCOUNT TO 52 PERCENT BASED ON INFORMATION FROM WEST POINT THAT THE MOTOR WOULD BE USED AS AN EDUCATIONAL UNIT IN STUDENT INSTRUCTION. BY LETTER DATED MARCH 15, 1957, THE COMPANY INCREASED THE LIST PRICE TO $978 LESS 52 PERCENT. PURCHASE ORDER NO. 57-A5813 WAS ISSUED IN ACCORDANCE WITH THE LETTER QUOTATIONS. ON JUNE 3, 1957, THE MOTOR WAS DELIVERED. BY LETTER DATED JUNE 14, 1957, THE COMPANY CLAIMED ERROR ALLEGING THAT ITS DISCOUNT TO GOVERNMENT SPONSORED EDUCATIONAL FACILITIES FOR THE SUBJECT MOTOR IS 32 PERCENT. THE COMPANY HAS SUBSTANTIATED ITS ALLEGATION WITH MATERIAL ON "EDUCATIONAL SALES POLICY" AND "DISCOUNTS" FROM ITS "EDUCATIONAL SERVICE HANDBOOK.'

THE COMPANY HAS BEEN PAID $469.44 IN ACCORDANCE WITH THE TERMS OF THE PURCHASE ORDER LESS A $5.93 DISCOUNT, OR A NET AMOUNT OF $463.51. DECREASING THE EDUCATION DISCOUNT FROM 52 PERCENT TO 32 PERCENT WOULD RESULT IN A NET PRICE OF $665.04. IN RESPONSE TO TELEPHONE REQUESTS MADE BY THE CONTRACTING OFFICER ON MARCH 8, 1957, GENERAL ELECTRIC SUPPLY COMPANY, POUGHKEEPSIE, NEW YORK, AND GRAYBAR ELECTRIC COMPANY, ALBANY, NEW YORK, HAD QUOTED NET PRICES OF $6660 AND $664, RESPECTIVELY.

THE CONTRACTING OFFICER HAS RECOMMENDED THAT THE CLAIM BE DENIED ON THE BASIS THAT HE SHOULD NOT BE EXPECTED TO BE FAMILIAR WITH THE PRICING POLICY OF THE COMPANY.

ALTHOUGH ORDINARILY A WIDE RANGE BETWEEN A LOW PRICE QUOTATION AND OTHER QUOTED PRICES OR BETWEEN A LOW PRICE QUOTATION AND THE GOVERNMENT ESTIMATED PRICE WILL SERVE AS AN INDICATION OF ERROR IN THE LOW QUOTATION, THE IMMEDIATE SITUATION IS SUCH THAT IT SEEMS REASONABLE TO CONCLUDE THAT THE CONTRACTING OFFICER LACKED CONSTRUCTIVE NOTICE OF ERROR. IN ITS LETTER OF MARCH 11, 1957, THE COMPANY INDICATED THAT THE INCREASED DISCOUNT WAS ALLOWED BECAUSE THE MOTOR WAS TO BE USED AS AN EDUCATIONAL UNIT. THE COMPANY'S EXPLANATION FOR THE INCREASED DISCOUNT PROBABLY MADE THE CONTRACTING OFFICER BELIEVE THAT THE QUOTATION WAS AS INTENDED SINCE IT INDICATED THAT THE MATTER OF DISCOUNT WAS CHECKED. FURTHERMORE, WHEN THE COMPANY INCREASED ITS LIST PRICE ON MARCH 15, 1957, IT CONFIRMED THE DISCOUNT. ONCE THE COMPANY CONFIRMED ITS PRICE, IT WAS PROPER FOR THE CONTRACTING OFFICE TO ACCEPT THE QUOTATION AS SUBMITTED AND CONFIRMED. COMP. GEN. 942, 947.

THE MISTAKE WAS DUE SOLELY TO THE COMPANY'S CARELESSNESS, NEGLIGENCE OR OVERSIGHT IN READING ITS OWN PRICE MATERIALS; AND IT WAS NOT CONTRIBUTED TO IN ANY MANNER BY THE GOVERNMENT NOR WAS THERE ANYTHING TO MAKE THE CONTRACTING OFFICER SUSPECT THAT THE QUOTATION WAS NOT AS INTENDED. SEE GRYMES AND SANDERS, ET AL., 93 U.S. 55, 61. THE BIDDER IS NOT ENTITLED TO ANY REDRESS FOR THE CONSEQUENCES OF ITS UNILATERAL MISTAKE. OGDEN AND DOUGHERTY V. UNITED STATES, 102 C.CLS. 249, 259; SALIGMAN, ET AL. V. UNITED STATES, 56 F.SUPP. 505, 507.

IN THE CIRCUMSTANCES, THERE IS NO LEGAL BASIS FOR GRANTING ANY RELIEF BASED ON THE CLAIM OF ERROR.