B-134113, DEC. 2, 1957

B-134113: Dec 2, 1957

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VETERANS ADMINISTRATION: REFERENCE IS MADE TO THE MATTER OF A VOUCHER CLAIM DATED AUGUST 21. THE CLAIM IS FOR PAYMENT OF AN ADDITIONAL AMOUNT OF $227.83 FOR BREAD DELIVERED BY THE CLAIMANT TO THE VETERANS ADMINISTRATION HOSPITAL. RESULTS FROM AN ERROR ALLEGED IN ITS BID ON WHICH THE CONTRACT WAS BASED. SINCE THE CONTRACT APPLIES THROUGHOUT THE FISCAL YEAR 1958 AND SUBSEQUENT ADDITIONAL CLAIMS WILL BE INVOLVED. A DECISION IN THE MATTER IS RENDERED TO YOU. BIDDERS WERE URGED TO SUBMIT BIDS. TWO OTHER BIDS WERE RECEIVED ON THE SAME ITEMS. WHEN BIDS WERE OPENED ON JUNE 19. THE CONTRACTING OFFICER NOTED THAT THE BID OF WILLIAMS' BAKERY WAS CONSIDERABLY LOWER THAN THE OTHER BIDS. THE BIDDER WAS REQUESTED BY TELEPHONE TO VERIFY ITS BID.

B-134113, DEC. 2, 1957

TO THE HONORABLE H. V. HIGLEY, ADMINISTRATOR, VETERANS ADMINISTRATION:

REFERENCE IS MADE TO THE MATTER OF A VOUCHER CLAIM DATED AUGUST 21, 1957, FROM WILLIAMS' BAKERY, ROSENBURG, OREGON, TRANSMITTED BY THE DIRECTOR, AUDIT AND ACCOUNTING SERVICE, DEPARTMENT OF MEDICINE AND SURGERY, UNDER DATE OF SEPTEMBER 9, 1957, TO THE CLAIMS DIVISION OF OUR OFFICE FOR SETTLEMENT. THE CLAIM IS FOR PAYMENT OF AN ADDITIONAL AMOUNT OF $227.83 FOR BREAD DELIVERED BY THE CLAIMANT TO THE VETERANS ADMINISTRATION HOSPITAL, ROSENBURG, OREGON, DURING THE MONTH OF JULY 1957 UNDER CONTRACT NO. V5133P-264, AND RESULTS FROM AN ERROR ALLEGED IN ITS BID ON WHICH THE CONTRACT WAS BASED.

SINCE THE CLAIM INVOLVES AN ERROR IN BID ON WHICH A CONTRACT HAS BEEN AWARDED AND, ALSO, SINCE THE CONTRACT APPLIES THROUGHOUT THE FISCAL YEAR 1958 AND SUBSEQUENT ADDITIONAL CLAIMS WILL BE INVOLVED, A DECISION IN THE MATTER IS RENDERED TO YOU.

BY INVITATION NO. 58-7, ISSUED JUNE 3, 1957, THE VETERANS ADMINISTRATION HOSPITAL, ROSEBURG, OREGON, SOLICITED BIDS FOR FURNISHING AND DELIVERING BREAD TO THE HOSPITAL AS SPECIFIED IN THE INVITATION. BIDDERS WERE URGED TO SUBMIT BIDS, WITH UNIT PRICES BEING ON A 22 1/2-OUNCE LOAF, FOR FURNISHING 20,000 LOAVES OF BREAD AS REQUIRED DURING THE 6-MONTH PERIOD BEGINNING JULY 1, 1957, AND ENDING DECEMBER 31, 1957, (ITEM NO. 1), OR AS AN ALTERNATE TO ITEM NO. 1, FOR FURNISHING 40,000 LOAVES AS REQUIRED DURING THE 12-MONTH PERIOD BEGINNING JULY 1, 1957, AND ENDING JUNE 30, 1958, (ITEM NO. 2). IN RESPONSE TO THE INVITATION, WILLIAMS' BAKERY SUBMITTED A BID AS TO BOTH ITEMS WITH A UNIT PRICE OF $0.137 PER A 22 1/2- OUNCE LOAF, AND A TOTAL AMOUNT OF $2,740 FOR ITEM NO. 1 AND $5,480 FOR ITEM NO. 2. TWO OTHER BIDS WERE RECEIVED ON THE SAME ITEMS, ONE WITH A UNIT PRICE OF $0.228 AND THE OTHER $0.24 FOR A 22 1/2-OUNCE LOAF.

WHEN BIDS WERE OPENED ON JUNE 19, 1957, THE CONTRACTING OFFICER NOTED THAT THE BID OF WILLIAMS' BAKERY WAS CONSIDERABLY LOWER THAN THE OTHER BIDS, AND THE BIDDER WAS REQUESTED BY TELEPHONE TO VERIFY ITS BID. THE BIDDER THEN STATED THAT IT HAD MADE AN ERROR IN ITS BID. IN A LETTER SUBSEQUENTLY RECEIVED BY THE CONTRACTING OFFICER, WILLIAMS' BAKERY REQUESTED THAT ITS UNIT PRICE BE INCREASED TO $0.2055 FOR A 22 1/2-OUNCE LOAF, AND ITS TOTAL BID PRICE FOR ITEM NO. 1 CHANGED TO $4,110 AND FOR ITEM NO. 2 TO $8.220. THE BIDDER EXPLAINED THAT ITS UNIT PRICE OF $0.137 IN THE BID WAS IN ERROR BECAUSE IT HAD BEEN COMPUTED ON THE BASIS OF FURNISHING A 15-OUNCE LOAF, AS IT HAD DONE IN THE PAST, HAVING FAILED TO NOTE THAT THE INVITATION CALLED FOR A UNIT PRICE ON A 22 1/2-OUNCE LOAF. THE BIDDER SUBMITTED ITS ORIGINAL PENCIL WORKSHEET IN SUBSTANTIATION OF ITS CLAIM OF ERROR. CONTRACT NO. V5133F-264 WAS AWARDED ON JUNE 27, 1957, TO THE WILLIAMS' BAKERY ON THE BASIS OF ITS BID AS ORIGINALLY SUBMITTED.

THE CONTRACTING OFFICER REPORTS THAT, IN THE PAST, BID INVITATIONS HAVE BEEN SOLICITED FOR 15 AND 22 1/2-OUNCE LOAVES OF BREAD WITH A "15 OZ UNIT," AND THAT "WILLIAMS' BAKERY HAS BEEN SUPPLYING A 22 1/2-OUNCE LOAF, AND BILLING AND RECEIVING REPORTS ADJUSTED ACCORDINGLY. NO REPRESENTATIVE OF WILLIAMS' BAKERY WAS PRESENT AT THE OPENING OF BIDS, AND THE BIDDER HAS MADE NO INQUIRY AS TO PRICES QUOTED BY OTHER BIDDERS.

ON THE RECORD, WILLIAMS' BAKERY ALLEGED AND SATISFACTORILY EXPLAINED THE ERROR IN ITS BID AND ESTABLISHED ITS INTENDED BID PRICE PRIOR TO AWARD. ITS BID, IF CORRECTED TO ITS INTENDED FIGURE OF $0.2055, WOULD CONTINUE TO BE THE LOWEST BID FOR FURNISHING THE BREAD AS REQUIRED BY THE INVITATION. ACCORDINGLY, CONTRACT NO. V5133P-264 SHOULD BE AMENDED TO REFLECT WILLIAMS' BAKERY'S INTENDED UNIT BID PRICE OF $0.2055 FOR A 22 1/2-OUNCE LOAF OF BREAD. PAYMENTS ON THE CONTRACT ARE AUTHORIZED TO BE MADE ON THAT BASIS.

THE VOUCHER CLAIM OF WILLIAMS' BAKERY FOR THE ADDITIONAL AMOUNT OF $227.83 ON ACCOUNT OF BREAD DELIVERIES DURING THE MONTH OF JULY 1957 UNDER CONTRACT NO. V5133P-264, AND YOUR FILE PERTAINING THERETO ARE RETURNED.

A REFERENCE TO THIS DECISION SHOULD BE MADE ON THE AMENDMENT TO BE ATTACHED TO THE CONTRACT, AND ALSO ON VOUCHERS COVERING PAYMENTS UNDER THE CONTRACT.