B-134136, OCT. 25, 1957

B-134136: Oct 25, 1957

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TO THE SECRETARY OF THE INTERIOR: REFERENCE IS MADE TO A LETTER DATED OCTOBER 16. WAS AWARDED. THE DECISION IS BEING ADDRESSED TO YOU. WHICH WAS A LUMP SUM TO ACCOMPLISH THE WORK IN ITEMS 1. THE CONTRACTING OFFICER STATED THAT THE CONTRACTOR WAS NOT PRESENT AT THE BID OPENING ON JUNE 20. WAS REPRESENTED BY AN EMPLOYEE WHO DID NOT ALLEGE ERROR IN THE BID AT THAT TIME. IT IS REPORTED THAT ABOUT ONE HOUR AFTER THE BIDS WERE OPENED MR. THE CONTRACT WAS AWARDED MR. THERE IS NOTHING OF RECORD TO SHOW THAT MR. LASHNER'S BID WAS ACCEPTED PRIOR TO THE DATE OF THE CONTRACT. IT APPEARS THAT THE CONTRACTING OFFICER WAS AWARE OF THE CLAIM OF ERROR PRIOR TO AWARD. IT IS TO BE NOTED THAT THE LUMP SUM BIDS OF THE OTHER FIVE BIDDERS EQUALLED THE EXACT TOTALS OF THEIR INDIVIDUAL ITEM BIDS.

B-134136, OCT. 25, 1957

TO THE SECRETARY OF THE INTERIOR:

REFERENCE IS MADE TO A LETTER DATED OCTOBER 16, 1957, FROM MR. M. O. ANDERSON, CONTRACTING OFFICER, INDEPENDENCE NATIONAL HISTORICAL PARK, PHILADELPHIA, PENNSYLVANIA, REQUESTING A DECISION AS TO THE ACTION TO BE TAKEN CONCERNING AN ERROR ALLAN N. LASHNER ALLEGES HE MADE IN HIS BID ON WHICH CONTRACT NO. 14-10-529-634, DATED JUNE 21, 1957, WAS AWARDED.

SINCE AN AWARD HAS BEEN MADE IN THE PRESENT CASE, THE DECISION IS BEING ADDRESSED TO YOU. SEE 26 COMP. GEN. 993; AND 28 ID. 401.

THE DEPARTMENT OF THE INTERIOR, NATIONAL PARK SERVICE, INDEPENDENCE NATIONAL HISTORICAL PARK, PHILADELPHIA, PENNSYLVANIA, BY INVITATION NO. 29 -IND-16, REQUESTED BIDS FOR DEMOLISHING CERTAIN BUILDINGS AND BACKFILLING THE SITES OF SUCH BUILDINGS. ALLAN M. LASHNER OFFERED TO PERFORM ITEM 1 FOR $18,000; ITEM 2 FOR $7,000, AND ITEM 3 FOR $12,000. ON ITEM 4, WHICH WAS A LUMP SUM TO ACCOMPLISH THE WORK IN ITEMS 1, 2, 3, MR. LASHNER BID $32,000. THE CONTRACTING OFFICER STATED THAT THE CONTRACTOR WAS NOT PRESENT AT THE BID OPENING ON JUNE 20, 1957, BUT WAS REPRESENTED BY AN EMPLOYEE WHO DID NOT ALLEGE ERROR IN THE BID AT THAT TIME. IT IS REPORTED THAT ABOUT ONE HOUR AFTER THE BIDS WERE OPENED MR. LASHNER ADVISED THE CONTRACTING OFFICER THAT BECAUSE OF AN ERROR IN ADDITION, HIS BID SHOULD BE CORRECTED TO SHOW A TOTAL OF $37,000 INSTEAD OF $32,000. IN LETTER OF JUNE 20, 1957, MR. LASHNER EXPLAINED THE ERROR. ON THE FOLLOWING DAY, JUNE 21, 1957, THE CONTRACT WAS AWARDED MR. LASHNER FOR ACCOMPLISHING THE WORK IN ITEMS 1, 2, AND 3 FOR $32,000. THERE IS NOTHING OF RECORD TO SHOW THAT MR. LASHNER'S BID WAS ACCEPTED PRIOR TO THE DATE OF THE CONTRACT. THUS, IT APPEARS THAT THE CONTRACTING OFFICER WAS AWARE OF THE CLAIM OF ERROR PRIOR TO AWARD.

THE CONTRACTING OFFICER STATED THAT IN PREVIOUS BIDS SUBMITTED BY MR. LASHNER THE LUMP SUM BID ALWAYS EQUALLED THE EXACT TOTAL OF THE SEVERAL ITEMS. ALSO, IT IS TO BE NOTED THAT THE LUMP SUM BIDS OF THE OTHER FIVE BIDDERS EQUALLED THE EXACT TOTALS OF THEIR INDIVIDUAL ITEM BIDS. CONSIDERING THE FACT THAT THE NEAREST OF THE OTHER BIDS WAS MORE THAN FIFTY PERCENT HIGHER THAN THE $32,000, IT APPEARS UNREASONABLE TO DOUBT THAT MR. LASHNER MADE THE ERROR AS ALLEGED.

WHILE IT IS TRUE THE RESPONSIBILITY FOR THE PREPARATION OF A BID IS UPON THE BIDDER, WHO ORDINARILY MUST BEAR THE CONSEQUENCES OF AN ERROR IN THE BID UPON WHICH A CONTRACT IS BASED, THAT RULE DOES NOT ENTITLE THE GOVERNMENT TO TAKE ADVANTAGE OF A BIDDER'S ERROR, WHEN AS IN THE PRESENT CASE, IT HAS BEEN ALLEGED AND SATISFACTORILY ESTABLISHED PRIOR TO AWARD. THE GENERAL RULE IS THAT THE ACCEPTANCE OF A BID WITH KNOWLEDGE OF ERROR THEREIN DOES NOT CONSUMMATE A VALID AND BINDING CONTRACT. SEE NASON COAL COMPANY V. UNITED STATES, 64 C.CLS. 526; RESTATEMENT OF THE LAW OF CONTRACTS, SECTION 503; AND WILLISTON ON CONTRACTS, SECTION 1578. ALSO, SEE MOFFETT, HODGKINS, AND CLARKE COMPANY V. ROCHESTER, 178 U.S. 373; KEMP V. UNITED STATES, 38 F.SUPP. 568; ALTA ELECTRIC AND MECHANICAL COMPANY, INC. V. UNITED STATES, 90 C.CLS. 466; AND 17 COMP. GEN. 575, 576. INSIST UPON A STRICT COMPLIANCE WITH MR. LASHNER'S ERRONEOUS BID IN THE PRESENT CIRCUMSTANCES, ESPECIALLY WHERE THE CONTRACTING OFFICER WAS ON ACTUAL NOTICE OF THE CLAIM OF ERROR AT THE TIME OF AWARD, COULD HARDLY BE REGARDED AS AN ACT OF GOOD FAITH UPON THE PART OF THE GOVERNMENT.

ACCORDINGLY, AND SINCE THE FILE INDICATES THAT MR. LASHNER PROCEEDED WITH THE WORK AFTER AWARD AND SUCH WORK IS NOT YET COMPLETED, THE CONTRACT SHOULD BE AMENDED TO INCREASE THE TOTAL CONTRACT PRICE TO $37,000, WHICH IS STILL THE LOWEST BID RECEIVED.

A REFERENCE TO THIS DECISION SHOULD BE MADE ON THE AMENDMENT TO THE CONTRACT.