B-135153, FEB. 27, 1958

B-135153: Feb 27, 1958

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TO THE SECRETARY OF THE NAVY: REFERENCE IS MADE TO A LETTER DATED FEBRUARY 5. REQUESTING A DECISION AS TO THE MATTER OF AN ERROR ALLEGED BY THE GENERAL MOTORS CORPORATION TO HAVE BEEN MADE IN ITS BID UPON WHICH CONTRACT NO. WAS AWARDED. SINCE THE BID OF GENERAL MOTORS CORPORATION WAS THE LOWEST BID RECEIVED. IT WAS ACCEPTED BY NOTICE OF AWARD DATED DECEMBER 20. 406.05 WAS IN ERROR. WAS CONSIDERABLY LOWER THAN THE ONLY OTHER BID OF $5. THERE ALSO CAN BE NO DOUBT BUT THAT THE CONTRACTING OFFICER WAS CONFRONTED WITH A SITUATION WHERE THE USUAL BID COMPARISON BASIS WAS OF LITTLE. BENEFIT TO HIM BECAUSE IT CONSISTENTLY HAS BEEN HELD THAT WHERE ONLY TWO WIDELY VARIANT BIDS ARE RECEIVED NO FAIR COMPARISON THEREOF CAN BE MADE.

B-135153, FEB. 27, 1958

TO THE SECRETARY OF THE NAVY:

REFERENCE IS MADE TO A LETTER DATED FEBRUARY 5, 1958, WITH ENCLOSURES, FROM THE ASSISTANT SECRETARY OF THE ARMY (LOGISTICS), REQUESTING A DECISION AS TO THE MATTER OF AN ERROR ALLEGED BY THE GENERAL MOTORS CORPORATION TO HAVE BEEN MADE IN ITS BID UPON WHICH CONTRACT NO. DA-45-164 -CIVENG-58-64, WAS AWARDED.

IN RESPONSE TO INVITATION NO. CIVENG-45-164-58-27, ISSUED BY THE U.S. ARMY ENGINEER DISTRICT, CORPS OF ENGINEERS, WALLA WALLA, WASHINGTON, GENERAL MOTORS CORPORATION OFFERED TO FURNISH ONE 1958 TRUCK, DUMP, 4- YARD, ETC., IN ACCORDANCE WITH APPLICABLE SPECIFICATIONS FOR A TOTAL PRICE OF $4,406.05, F.O.B. WALLA WALLA, WASHINGTON, LESS $25 A TRUCK-20 DAYS. THE FORD MOTOR COMPANY SUBMITTED THE ONLY OTHER BID RECEIVED IN THE TOTAL AMOUNTS OF $4,476.40, F.O.B. LOUISVILLE, KENTUCKY, AND $5,167.80, F.O.B. PORTLAND, OREGON, BOTH PRICES LESS $25 A TRUCK-30 DAYS. SINCE THE BID OF GENERAL MOTORS CORPORATION WAS THE LOWEST BID RECEIVED, IT WAS ACCEPTED BY NOTICE OF AWARD DATED DECEMBER 20, 1957, THEREBY CONSUMMATING CONTRACT NO. DA-45-164-CIVENG-58-64. ON DECEMBER 23, 1957, A REPRESENTATIVE OF GENERAL MOTORS CORPORATION ADVISED THE WALLA WALLA CORPS OF ENGINEERS THAT THE BID OF $4,406.05 WAS IN ERROR, IN THAT IT DID NOT INCLUDE THE AMOUNT OF $857.50 FOR THE DUMP BODY. BY LETTER DATED DECEMBER 24, 1957, THE CORPORATION FORWARDED ITS APPLICABLE ,CUSTOMER BREAKDOWN" SHEET TO SUBSTANTIATE ITS STATEMENT AS TO HOW THE ERROR OCCURRED AND REQUESTED PERMISSION TO EITHER WITHDRAW ITS BID OR TO MAKE DELIVERY OF THE TRUCK AT ITS INTENDED BID PRICE OF $5,263.55.

WHILE THERE CAN BE NO QUESTION BUT THAT THE BASIC BID PRICE OF $4,406.05, F.O.B. WALLA WALLA, WASHINGTON, WAS CONSIDERABLY LOWER THAN THE ONLY OTHER BID OF $5,167.80, F.O.B. PORTLAND, OREGON, THERE ALSO CAN BE NO DOUBT BUT THAT THE CONTRACTING OFFICER WAS CONFRONTED WITH A SITUATION WHERE THE USUAL BID COMPARISON BASIS WAS OF LITTLE, IF ANY, BENEFIT TO HIM BECAUSE IT CONSISTENTLY HAS BEEN HELD THAT WHERE ONLY TWO WIDELY VARIANT BIDS ARE RECEIVED NO FAIR COMPARISON THEREOF CAN BE MADE, IN THAT, GENERALLY THERE IS NO MORE REASON FOR CONSIDERING THAT THE LOW BID WAS TOO LOW THAN THERE IS FOR CONSIDERING THAT A MISTAKE WAS MADE BY THE HIGH BIDDER IN QUOTING A BID TOO HIGH. SEE 20 COMP. GEN. 286. THE CONTRACTING OFFICER STATES THAT SINCE SOME PRICE VARIATIONS OCCUR IN THE SUBMISSION OF BIDS ON AUTOMOTIVE ITEMS, THE PRICE DIFFERENTIAL IN THE SUBJECT BIDS DID NOT APPEAR TO HIM TO BE SO ENTIRELY OUT OF LINE AS TO SUGGEST A BIDDING ERROR. MOREOVER, THE FACT THAT THE GENERAL MOTORS CORPORATION HAD SUBMITTED A BID OF $5,223 ON IDENTICAL EQUIPMENT IN SEPTEMBER 1956 MAY NOT BE ACCEPTED AS BEING PARTICULARLY RELEVANT UNDER FACTS SUCH AS HERE INVOLVED. THEREFORE, THERE WAS NOT SUGGESTED, IN THE FIRST INSTANCE, ANY NEED FOR A FURTHER ATTEMPT TO ASCERTAIN THE CORRECTNESS OF SUCH LOW BID BY A SEARCH FOR SIMILAR PRIOR PROCUREMENTS, ETC.

IN VIEW OF THE FOREGOING, IT MUST BE HELD THAT THE ACCEPTANCE OF THE LOW BID OF THE GENERAL MOTORS CORPORATION 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 RIGHT WHICH VESTED IN THE GOVERNMENT UNDER SUCH A CONTRACT.

ACCORDINGLY, THERE IS FOUND NO LEGAL BASIS FOR GRANTING ANY RELIEF TO THE GENERAL MOTORS CORPORATION UNDER CONTRACT NO. DA-45-164-CIVENG-58 64.

THE PAPERS, WITH THE EXCEPTION OF THE FINDINGS OF FACT DATED JANUARY 3, 1958, OF THE CONTRACTING OFFICER, ARE RETURNED HEREWITH.