B-135722, APR. 16, 1958

B-135722: Apr 16, 1958

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TO THE SECRETARY OF THE ARMY: REFERENCE IS MADE TO A LETTER DATED APRIL 1. IS BASED. FIVE BIDS WERE RECEIVED RANGING FROM $18. THE THREE LOW BIDS AND THE GOVERNMENT ESTIMATE ARE AS FOLLOWS: SCHEDULE. THE THREE LOW BIDS AND THE GOVERNMENT ESTIMATE ON THIS ITEM ARE AS FOLLOWS: SCHEDULE. WILBURN THAT HIS BID WAS EXTREMELY LOW AND ASKED HIM IF THERE WAS A PARTICULAR REASON WHY IT WAS SO LOW. WILBURN ADVISED THAT HE COULD NOT DETERMINE WHY HIS BID WAS SO LOW. AWARD WAS MADE TO MR. THE ALLEGATION WAS CONFIRMED BY LETTER OF OCTOBER 17. THE CONTRACTOR FURNISHED HIS ALLEGED ORIGINAL WORKSHEETS WHEREON IT WAS SHOWN THAT THE CORRECT ADDITION OF THE AMOUNTS USED IN ARRIVING AT THE BID ON ITEM 3 WAS $3.30 PER CUBIC YARD.

B-135722, APR. 16, 1958

TO THE SECRETARY OF THE ARMY:

REFERENCE IS MADE TO A LETTER DATED APRIL 1, 1958, FROM THE ASSISTANT SECRETARY OF THE ARMY (LOGISTICS), REQUESTING A DECISION AS TO THE ACTION TO BE TAKEN CONCERNING AN ERROR F. E. WILBURN ALLEGES HE MADE IN HIS BID ON WHICH CONTRACT NO. DA-35-026-CIVENG-58-101, DATED SEPTEMBER 26, 1957, IS BASED.

BY INVITATION NO. CIVENG-35-026-58-38, DATED SEPTEMBER 6, 1957, THE U.S. ARMY ENGINEER DISTRICT, PORTLAND CORPS OF ENGINEERS, PORTLAND, OREGON, REQUESTED BIDS--- TO BE OPENED SEPTEMBER 24, 1957--- FOR THE CONSTRUCTION OF BAY OCEAN CLOSURE ROADWAYS, TILLAMOCK BAY, OREGON. FIVE BIDS WERE RECEIVED RANGING FROM $18,360 TO $51,800. THE THREE LOW BIDS AND THE GOVERNMENT ESTIMATE ARE AS FOLLOWS:

SCHEDULE.

F. E. WILBURN $18,360

STEELMAN-DUFF, INC. 28,515

CALKINS CRUSHING CO. 30,000

GOVERNMENT ESTIMATE 37,880

A SUBSTANTIAL PORTION OF THE DIFFERENCE BETWEEN THE BID SUBMITTED BY F. E. WILBURN AND THE GOVERNMENT ESTIMATE AND THE OTHER BIDS RECEIVED CAN BE ACCOUNTED FOR BY THE BID SUBMITTED ON ITEM 3, DUMPED RIPRAP. THE THREE LOW BIDS AND THE GOVERNMENT ESTIMATE ON THIS ITEM ARE AS FOLLOWS:

SCHEDULE.

UNIT PRICE TOTAL

F. E. WILBURN $2.30 $ 6,670.00

STEELMAN-DUFF, INC. 4.45 12,905.00

CALKINS CRUSHING COMPANY 6.00 17,400.00

GOVERNMENT ESTIMATE 5.00 14,500.00

MR. CHARLES A. LEACH, CHIEF, PROCUREMENT BRANCH, U.S. ARMY ENGINEER DISTRICT, PORTLAND, DISCUSSED THE BID WITH MR. WILBURN IMMEDIATELY AFTER THE BID OPENING. HE REMARKED TO MR. WILBURN THAT HIS BID WAS EXTREMELY LOW AND ASKED HIM IF THERE WAS A PARTICULAR REASON WHY IT WAS SO LOW. MR. WILBURN ADVISED THAT HE COULD NOT DETERMINE WHY HIS BID WAS SO LOW, BUT THAT HE FELT THAT HE HAD SUBMITTED A GOOD BID. ALSO, MR. WILBURN STATED THAT IF HIS SUBCONTRACTOR FOR QUARRY ROCK HELD TO ITS COMMITMENT, HE WOULD COME OUT ALL RIGHT.

MR. BASGEN OF THE PROCUREMENT BRANCH IN A DISCUSSION ON MATTERS PERTAINING TO EQUIPMENT AND SAFETY REQUIREMENTS, ALSO DISCUSSED WITH MR. WILBURN HIS EXTREME LOW BID AND MR. WILBURN REPLIED THAT HE THOUGHT HE HAD A GOOD BID. AWARD WAS MADE TO MR. WILBURN ON SEPTEMBER 26, 1957. OCTOBER 1, 1957, IN A TELEGRAM CONVERSATION, MR. WILBURN ALLEGED AN ERROR IN HIS BID. THE ALLEGATION WAS CONFIRMED BY LETTER OF OCTOBER 17, 1957. THE CONTRACTOR FURNISHED HIS ALLEGED ORIGINAL WORKSHEETS WHEREON IT WAS SHOWN THAT THE CORRECT ADDITION OF THE AMOUNTS USED IN ARRIVING AT THE BID ON ITEM 3 WAS $3.30 PER CUBIC YARD, WHEREAS THE BID ON THIS ITEM WAS $2.30 PER CUBIC YARD. THE CONTRACTOR REQUESTED THAT THE CONTRACT PRICE BE CHANGED FROM $18,360 TO $21,260. ALSO, THE CONTRACTOR ALLEGED THAT HE HAD TOLD MR. BASGEN THAT HE THOUGHT HIS BID WAS GOOD BUT THAT HE WOULD LIKE TO CHECK THE FIGURES AND THAT HE HAD BEEN TOLD BY MR. BASGEN THAT NO CONTRACT WOULD BE AWARDED UNTIL HIS REFERENCES HAD BEEN CHECKED. THE RECORD DOES NOT INDICATE THAT MR. WILBURN WAS GIVEN SUCH AN ASSURANCE.

THE BASIC QUESTION INVOLVED IS NOT WHETHER THE BIDDER MADE AN ERROR IN ITS BID, BUT WHETHER A VALID AND BINDING CONTRACT WAS CONSUMMATED BY THE ACCEPTANCE OF THE BID. UNDER THE CIRCUMSTANCES, THE ONLY DUTY IMPOSED ON THE CONTRACTING OFFICER PRIOR TO AWARD WAS TO VERIFY THAT THE BIDDER INTENDED TO SUBMIT A BID OF $18,360 AND INTENDED TO BE BOUND BY THE CONTRACTING OFFICER'S ACCEPTANCE THEREOF. SUCH DUTY WAS COMPLETELY DISCHARGED WHEN THE WIDE DIFFERENCE IN THE BID PRICES WAS CALLED TO THE ATTENTION OF MR. WILBURN, WHO REPLIED THAT HE HAD SUBMITTED A GOOD BID AND HE WOULD COME OUT "O.K.'

THE GENERAL RULE IS THAT WHERE A BIDDER IS AFFORDED A PROPER OPPORTUNITY TO VERIFY HIS BID PRICE PRIOR TO AWARD, THE CONTRACTING OFFICER IS UNDER NO OBLIGATION TO MAKE FURTHER INQUIRY AS TO THE CORRECTNESS OF THE BID. SEE CARNEGIE STEEL COMPANY V. CONNELLY, 97 A. 774; SHRIMPTON MANUFACTURING COMPANY V. BRIN, 125 S.W. 942.

ON THE BASIS OF THE PRESENT RECORD IT MUST THEREFORE BE CONCLUDED THAT ANY ERROR WHICH WAS DISCOVERED IN THE BID PRICE AFTER VERIFICATION WAS UNILATERAL--- NOT MUTUAL--- SALIGMAN ET AL. V. UNITED STATES, 56 F.SUPP. 505, 507; OGDEN AND DOUGHERTY V. UNITED STATES, 102 C.CLS. 249, 259, AND THAT THE ACCEPTANCE OF THE VERIFIED BID CONSUMMATED A VALID AND BINDING CONTRACT WHICH FIXED THE RIGHTS AND LIABILITIES OF THE PARTIES THERETO. SEE UNITED STATES V. PURCELL ENVELOPE COMPANY, 249 U.S. 313; AMERICAN SMELTING AND REFINING COMPANY V. UNITED STATES, 259 U.S. 75.

UNDER THE CIRCUMSTANCES, WE FIND NO LEGAL BASIS ON WHICH PAYMENTS IN EXCESS OF THE CONTRACT PRICE MAY BE MADE TO THE CONTRACTOR.

THE PAPERS, WITH THE EXCEPTION OF A COPY OF THE CONTRACTING OFFICER'S FINDINGS OF NOVEMBER 5, 1957, ARE RETURNED.