B-134967, FEB. 25, 1958

B-134967: Feb 25, 1958

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TO THE SECRETARY OF THE ARMY: REFERENCE IS MADE TO A LETTER DATED JANUARY 17. TWO OTHER COMPLETE BIDS WERE RECEIVED FOR LOT A IN THE NET AMOUNTS OF $9. THE BID OF THE AMERICAN STEEL FOUNDRIES WAS THE LOWEST BID RECEIVED FOR LOT A AND. THE BID WAS ACCEPTED BY THE HUNTINGTON DISTRICT CORPS OF ENGINEERS ON MARCH 19. AMERICAN STEEL FOUNDRIES ALLEGED THAT ITS BID ON LOT A WAS IN ERROR. IN THAT THERE HAD NOT BEEN INCLUDED IN THE BID ON LOT A WAS IN ERROR. IN THAT THERE HAD NOT BEEN INCLUDED IN THE BID ANY AMOUNT FOR THE MACHINE WORK THAT WAS REQUIRED. THE WORK UNDER THE CONTRACT IS REPORTED TO HAVE BEEN COMPLETED AND ACCEPTED. THREE BIDS WERE RECEIVED UNDER INVITATION NO. WHILE THE LOW BID OF THE COMPANY WAS OVER $2.

B-134967, FEB. 25, 1958

TO THE SECRETARY OF THE ARMY:

REFERENCE IS MADE TO A LETTER DATED JANUARY 17, 1958, WITH ENCLOSURES, FROM THE ASSISTANT SECRETARY OF THE ARMY (LOGISTICS), REQUESTING A DECISION AS TO WHETHER THERE MAY BE GRANTED THE RELIEF SOUGHT BY THE AMERICAN STEEL FOUNDRIES UNDER CONTRACT NO. DA-46-022 CIVENG-57-80, DATED MARCH 19, 1957.

IN RESPONSE TO INVITATION NO. CIVENG-46-022-57-60, ISSUED BY THE HUNTINGTON DISTRICT, CORPS OF ENGINEERS, DEPARTMENT OF THE ARMY, HUNTINGTON, WEST VIRGINIA, THE AMERICAN STEEL FOUNDRIES OFFERED TO FURNISH LOT A, CONSISTING OF FIVE SEPARATE ITEMS OF CAST STEEL WHICH, BASED ON THE NUMBER OF QUOIN BLOCKS, WICKET BOXES, WICKET SHOES, ETC., SPECIFIED UNDER THE RESPECTIVE ITEMS, AND AT THE UNIT PRICES QUOTED THEREFOR, RESULTED IN A TOTAL NET BID FOR THE LOT OF $7,247.73. TWO OTHER COMPLETE BIDS WERE RECEIVED FOR LOT A IN THE NET AMOUNTS OF $9,483.34 AND $13,815.80. THE BID OF THE AMERICAN STEEL FOUNDRIES WAS THE LOWEST BID RECEIVED FOR LOT A AND, THEREFORE, THE BID WAS ACCEPTED BY THE HUNTINGTON DISTRICT CORPS OF ENGINEERS ON MARCH 19, 1957, THEREBY CONSUMMATING CONTRACT NO. DA-46-022- CIVENG-57-80. SUBSEQUENT TO THE DATE OF AWARD, AMERICAN STEEL FOUNDRIES ALLEGED THAT ITS BID ON LOT A WAS IN ERROR, IN THAT THERE HAD NOT BEEN INCLUDED IN THE BID ON LOT A WAS IN ERROR, IN THAT THERE HAD NOT BEEN INCLUDED IN THE BID ANY AMOUNT FOR THE MACHINE WORK THAT WAS REQUIRED. LETTER DATED APRIL 24, 1957, THE COMPANY REQUESTED ADDITIONAL COMPENSATION IN THE TOTAL AMOUNT OF $4,180.80, TO COVER THE COST OF MACHINING THE CASTINGS. THE WORK UNDER THE CONTRACT IS REPORTED TO HAVE BEEN COMPLETED AND ACCEPTED.

AS HERETOFORE STATED, THREE BIDS WERE RECEIVED UNDER INVITATION NO. CIVENG-46-022-57-60 FOR LOT A WHICH INCLUDED, IN ADDITION TO THE LOW BID OF THE AMERICAN STEEL FOUNDRIES IN THE TOTAL NET AMOUNT OF $7,247.73, TWO OTHER BIDS OF $9,483.34 AND $13,815.80. HENCE, WHILE THE LOW BID OF THE COMPANY WAS OVER $2,200 LOWER THAN THE NEXT LOWEST BID, THE OVERALL RANGE OF THE BIDS WHICH MUST, OF COURSE, INCLUDE THE HIGH BID OF $13,815.80 ALSO SHOWS CONSIDERABLE VARIATION BETWEEN ALL THREE OF THE BID PRICES RECEIVED. IN VIEW OF THIS, AND EVEN THOUGH THE LOW BID OF THE AMERICAN STEEL FOUNDRIES FOR LOT A WAS ALSO MORE THAN $2,000 LOWER THAN THE GOVERNMENT'S COST ESTIMATE FOR THE CAST STEEL, IT IS NOT BELIEVED THAT THESE FACTS ALONE NORMALLY SHOULD BE ACCEPTED AS CREATING A SITUATION WHICH WOULD WARRANT CHARGING THE CONTRACTING OFFICER WITH NOTICE OF THE PROBABILITY OF AN ERROR IN THE LOW BID. MOREOVER, INSOFAR AS THE BID COMPARISON WITH A SIMILAR PRIOR PROCUREMENT IN 1955 IS CONCERNED, SINCE THERE APPEARS TO HAVE BEEN NOTHING ON THE FACE OF THE LOW BID OF THE AMERICAN STEEL FOUNDRIES FOR LOT A, OR IN THE IMMEDIATE ATTENDANT CIRCUMSTANCES THERETO THAT WOULD HAVE INDICATED ANY NEED FOR FURTHER EFFORTS TOWARD ASCERTAINING THE CORRECTNESS OF SUCH LOW BID, WE DO NOT FEEL THAT ANY LIABILITY SHOULD ATTACH TO THE GOVERNMENT BY REASON OF THE FACT THAT NO ATTEMPT WAS MADE PRIOR TO AWARD TO CHECK THE PROCUREMENT IN 1955--- APPROXIMATELY TWO YEARS EARLIER. IN VIEW OF THE FOREGOING, IT MUST BE HELD THAT THE ACCEPTANCE OF THE LOW BID OF THE AMERICAN STEEL FOUNDRIES FOR LOT A UNDER THE CIRCUMSTANCES REPORTED WAS MADE IN GOOD FAITH. SUCH ACCEPTANCE CONSUMMATED A VALID CONTRACT WHICH FIXED THE RIGHTS AND LIABILITIES OF THE PARTIES AND NEITHER OUR OFFICE NOR ANY OFFICER OF THE GOVERNMENT IS AUTHORIZED TO WAIVE OR RELINQUISH THE RIGHTS WHICH VEST IN THE GOVERNMENT UNDER SUCH CONTRACTS.

ACCORDINGLY, THERE IS FOUND NO LEGAL BASIS FOR THE ALLOWANCE OF ANY PART OF THE $4,180.80 CLAIMED BY THE AMERICAN STEEL FOUNDRIES IN THE MATTER.

THE PAPERS, WITH THE EXCEPTION OF THE FINDINGS OF FACT DATED NOVEMBER 19, 1957, OF THE CONTRACTING OFFICER, ARE RETURNED HEREWITH.