B-134482, DEC. 4, 1957

B-134482: Dec 4, 1957

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TO THE SECRETARY OF THE ARMY: REFERENCE IS MADE TO A LETTER DATED NOVEMBER 21. MAY BE MODIFIED SO AS TO CORRECT AN ERROR ALLEGED TO HAVE BEEN MADE THEREIN. THE BIDDERS WERE CAUTIONED THAT "THIS PROCUREMENT 1S SUBJECT TO THE AVAILABILITY OF FUNDS. WITH RESPECT TO QUANTITY: "DECREASE OPTION PROVISION: IF THE GOVERNMENT ELECTS TO TAKE A DIFFERENT QUANTITY THAN THAT ADVERTISED FOR OR BID UPON PRO RATA DELIVERY BASED ON THE DELIVERY SCHEDULE SPECIFIED IN THE BID FORM WILL BE REQUIRED. FAILURE TO INDICATE A MINIMUM QUANTITY WILL BE DEEMED AN OFFER: TO ACCEPT AN AWARD FOR THIS TOTAL QUANTITY LISTED OR ANY PART THEREOF.'. DESIGNATE A MINIMUM QUANTITY OF UNITS IT WAS WILLING TO FURNISH AT ITS QUOTED BID PRICE.

B-134482, DEC. 4, 1957

TO THE SECRETARY OF THE ARMY:

REFERENCE IS MADE TO A LETTER DATED NOVEMBER 21, 1957, WITH ENCLOSURES, FROM THE ASSISTANT SECRETARY OF THE ARMY (LOGISTICS), REQUESTING A DECISION AS TO WHETHER CONTRACT NO. DA-36-243-QM/CTM/ 299, DATED JUNE 14, 1957, WITH GRIMLAND COMPANY MANUFACTURERS, INC., MARIETTA, GEORGIA, MAY BE MODIFIED SO AS TO CORRECT AN ERROR ALLEGED TO HAVE BEEN MADE THEREIN.

BY INVITATION NO. QM/CTM-36-030-57-640, ISSUED FEBRUARY 28, 1957, THE PHILADELPHIA QUARTERMASTER DEPOT REQUESTED BIDS ON APPROXIMATELY 121,440 CLAMP, ROD, INSECT BAR, UNIVERSAL, AS SPECIFIED, TO BE DELIVERED PERIODICALLY IN STATED QUANTITIES TO THE FOUR DESTINATION POINTS NAMED. ON PAGE 1 OF THE BIDDING SCHEDULE, THE BIDDERS WERE CAUTIONED THAT "THIS PROCUREMENT 1S SUBJECT TO THE AVAILABILITY OF FUNDS," AND FURTHER, WITH RESPECT TO QUANTITY:

"DECREASE OPTION PROVISION: IF THE GOVERNMENT ELECTS TO TAKE A DIFFERENT QUANTITY THAN THAT ADVERTISED FOR OR BID UPON PRO RATA DELIVERY BASED ON THE DELIVERY SCHEDULE SPECIFIED IN THE BID FORM WILL BE REQUIRED.

TO BE FILLED IN BY BIDDER: BIDDER AGREES TO ACCEPT AN AWARD FOR NOT LESS THAN

(QUANTITY)

UNITS OF 121,440 UNITS.

FAILURE TO INDICATE A MINIMUM QUANTITY WILL BE DEEMED AN OFFER: TO ACCEPT AN AWARD FOR THIS TOTAL QUANTITY LISTED OR ANY PART THEREOF.'

IN ITS BID DATED MARCH 20, 1957, THE GRIMLAND COMPANY MANUFACTURERS, INC., QUOTED A PRICE OF $0.174 PER UNIT, OR A TOTAL CONTRACT PRICE OF $21,130.56 FOR THE 121,440 UNITS. THIS BIDDER DID NOT, HOWEVER, DESIGNATE A MINIMUM QUANTITY OF UNITS IT WAS WILLING TO FURNISH AT ITS QUOTED BID PRICE, NOR DID IT OTHERWISE INDICATE ANY OBJECTION TO THE CLAUSE WHICH RESERVED TO THE GOVERNMENT THE RIGHT TO AWARD THE ENTIRE OR ANY PART OF THE TOTAL QUANTITY LISTED.

ON JUNE 5, 1957, DUE TO THE REPORTED NON-AVAILABILITY OF FUNDS, THE QUANTITY OF UNITS AUTHORIZED TO BE PROCURED WAS REDUCED FROM 121,440, TO ONLY 37,449, OR BY APPROXIMATELY 70 PERCENT. INASMUCH AS THE GRIMLAND COMPANY MANUFACTURERS, INC., DID NOT RESTRICT ITS BID IN ANY MANNER, THE CONTRACT WAS AWARDED IT ON JUNE 14, 1957, UPON THE BASIS OF ITS LOW BID PRICE OF $0.174 EACH FOR THE 37,449 UNITS AUTHORIZED TO BE PROCURED.

ON JULY 5, 1957, OR THREE WEEKS SUBSEQUENT TO THE AWARD, THE CONTRACTOR TELEPHONED THE CONTRACTING OFFICER AND INQUIRED AS TO WHETHER IT WOULD RECEIVE AN ADDITIONAL AWARD. UPON BEING ADVISED IN THE NEGATIVE, THE CONTRACTOR STATED THAT IT HAD SUBMITTED ITS BID ON AN ALL OR NONE BASIS, WHICH, OF COURSE, IS NOT BORNE OUT BY THE FACTS. THEREAFTER, BY LETTER DATED JULY 20, 1957, THE CONTRACTOR REAFFIRMED ITS CONTENTION THAT ITS BID WAS FIGURED AND SUBMITTED ON A TOTAL QUANTITY BASIS, AND ALLEGED THAT THE ABSENCE OF THE WORD "TOTAL" IN ITS PROPOSAL WAS A TYPOGRAPHICAL OMISSION. IN ITS LETTER OF JULY 20 THE CONTRACTOR ALSO STATED THAT HE COULD NOT ACCEPT THE CONTRACT FOR THE LESSER QUANTITY UNLESS THE GOVERNMENT AGREED TO INCREASE THE UNIT PRICE FROM $0.174 TO $0.227 EACH. OTHERWISE, THE CONTRACTOR CLAIMS HE WILL SUSTAIN A NET LOSS OF $737.26 ON THE CONTRACT, AND A GROSS LOSS, INCLUDING OVERHEAD, OF$1,525.

AFTER FURTHER NEGOTIATIONS, HOWEVER, THE CONTRACTOR, IN A TELEGRAM DATED AUGUST 1, 1957, INFORMED THE CONTRACTING OFFICER THAT HE WOULD PERFORM THE CONTRACT, BUT "UNDER DURESS," AND REQUESTED THAT HIS LETTER OF JULY 20 BE CONSIDERED AS A CLAIM FOR AN INCREASE IN PRICE OF THE CONTRACT ARTICLES.

THE RECORD SHOWS THAT THIRTEEN PROPOSALS WERE RECEIVED IN RESPONSE TO THE PRESENT INVITATION. OF THESE, ELEVEN WERE QUALIFIED AS TO THE MINIMUM QUANTITIES WHICH WERE ACCEPTABLE TO THE BIDDERS. IT APPEARS THAT THE CONTRACTOR, AND ONLY ONE OTHER BIDDER, THE BENMAR COMPANY, CLEVELAND, OHIO, FAILED TO QUALIFY THEIR BIDS IN THIS MANNER, THEREBY AGREEING TO FURNISH ANY PROPORTION OF THE TOTAL LISTED QUANTITY AT THE RESPECTIVE UNIT PRICES QUOTED BY THEM. THE BENMAR COMPANY QUOTED A UNIT PRICE OF $0.238 FOR THIS ITEM, WHICH WAS $0.064 HIGHER THAN THE BID PRICE OF $0.174 EACH QUOTED BY THE CONTRACTOR. THIS DIFFERENTIAL IS NOT CONSIDERED SUFFICIENT TO HAVE PLACED THE CONTRACTING OFFICER ON CONSTRUCTIVE NOTICE OF ERROR IN THE CONTRACTOR'S PROPOSAL.

NOT ONLY HAS THE CONTRACTOR FAILED TO PRESENT CLEAR AND CONVINCING EVIDENCE TO SUBSTANTIATE ITS ALLEGATION THAT IT INADVERTENTLY OMITTED THE WORD "TOTAL" FROM ITS BID, BUT IT HAS OTHERWISE FAILED TO ESTABLISH THAT ITS BID WAS INTENDED TO BE ON AN ALL OR NONE BASIS. IT SHOULD BE NOTED THAT THE QUANTITY QUALIFICATION CLAUSE APPEARS IN BOLD LETTERS ON THE FIRST PAGE OF THE INVITATION, AS DOES THE QUOTED DECREASE OPTION PROVISION, RESERVING TO THE GOVERNMENT THE RIGHT TO ORDER A DIFFERENT QUANTITY THAN THAT INDICATED, AND OBLIGATING THE CONTRACTOR TO DELIVER ANY REVISED QUANTITY OF ITEMS ON A PRO RATA BASIS. IN THE CIRCUMSTANCES, THE CONTRACTOR'S FAILURE TO INDICATE IN HIS BID AN INTENT TO QUOTE ON A TOTAL QUANTITY BASIS RESULTED SOLELY FROM HIS OWN NEGLIGENCE, WHICH, OF COURSE, AFFORDS HIM NO BASIS FOR AVOIDING HIS CONTRACTUAL LIABILITY. SEE FRAZIER- DAVIS CONSTRUCTION COMPANY V. UNITED STATES, 100 C.CLS. 120, 160, 163; 20 COMP. GEN. 652.

CONCERNING THE CONTRACTOR'S CLAIM FOR AN INCREASE IN ITS CONTRACT PRICE OF THE ITEM, IT LONG HAS BEEN RECOGNIZED THAT MUTUAL MISTAKE AFFORDS THE ONLY LEGAL JUSTIFICATION FOR THE REFORMATION OR MODIFICATION OF A CONTRACT. SEE OGDEN AND DOUGHERTY V. UNITED STATES, 102 C.CLS. 249; SALIGMAN, ET AL. V. UNITED STATES, 56 F.SUPP. 505, 507. HERE, THE RECORD ESTABLISHES THAT ON JUNE 14, 1957, THE CONTRACTING OFFICER ACCEPTED THE CONTRACTOR'S BID IN ENTIRE GOOD FAITH, AND WITHOUT ANY NOTICE, EITHER ACTUAL OR CONSTRUCTIVE, OF THE CONTRACTOR'S ALLEGED ERROR IN HAVING OMITTED THE WORD "TOTAL" FROM ITS PROPOSAL, AND WITHOUT ANY KNOWLEDGE OF THE CONTRACTOR'S INTENT TO RESTRICT THE AWARD TO AN ALL OR NONE BASIS. THE CONCLUSION IS INESCAPABLE, THEREFORE, THAT THE MISTAKE OR OMISSION HERE ALLEGED WAS UNILATERAL IN CHARACTER AND, THUS, DOES NOT ENTITLE THE CONTRACTOR TO THE RELIEF REQUESTED IN THIS CASE. SEE UNITED STATES V. SABIN METAL CORPORATION, 151 F.SUPP. 683. ..END :