B-136104, MAY 22, 1958, 37 COMP. GEN. 786

B-136104: May 22, 1958

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AFTER ADVISING THE LOW BIDDER THAT HIS BID IS CONSIDERABLY LOWER THAN THE NEXT LOWEST BID. 1958: REFERENCE IS MADE TO LETTER DATED MAY 8. DA-36-039-SC-75209 WAS AWARDED. ONLY THE ITEM FOR THE 256 TEST SETS ARE INVOLVED HERE AND. THE FOLLOWING RESPONSIVE BIDS WERE RECEIVED: $129.50. REQUESTED THAT THEY CONFIRM THEIR BID SINCE IT APPEARED THAT ITS PRICE WAS CONSIDERABLY LOWER THAN THE NEXT LOWEST BID. UHRIG WAS ALSO ADVISED OF HIS RIGHT UNDER ASPR 2-405 TO REQUEST RELIEF BECAUSE OF MISTAKE IN BID. AWARD WAS MADE TO FORWAY ON MAY 17. ITS INTENDED BID PRICE WOULD HAVE BEEN $210.477 FOR EACH UNIT. IT APPEARS THAT THE NATURE AND EXTENT OF SUCH ERRORS HAVE BEEN ESTABLISHED BY WORKSHEETS AND SUPPLIERS' QUOTATIONS.

B-136104, MAY 22, 1958, 37 COMP. GEN. 786

CONTRACTS - MISTAKES - VERIFICATION PRIOR TO ALLEGATION OF ERROR - CONTRACTING OFFICER'S RESPONSIBILITY A CONTRACTING OFFICER WHO, AFTER ADVISING THE LOW BIDDER THAT HIS BID IS CONSIDERABLY LOWER THAN THE NEXT LOWEST BID, RECEIVES AN UNEQUIVOCABLE CONFIRMATION OF THE BID HAS FULFILLED HIS RESPONSIBILITY FOR THE ASCERTAINMENT OF THE CORRECTNESS OF THE BID AND THE SUBSEQUENT ALLEGATION BY THE CONTRACTOR, AFTER AWARD, OF AN ERROR IN THE BID PRICE DUE TO MATHEMATICAL AND TYPING MISTAKES DOES NOT AFFORD A BASIS FOR MODIFICATION OF THE CONTRACT.

TO THE SECRETARY OF THE ARMY, MAY 22, 1958:

REFERENCE IS MADE TO LETTER DATED MAY 8, 1958, WITH ENCLOSURES, FROM THE ASSISTANT SECRETARY ( LOGISTICS), REQUESTING OUR DECISION AS TO THE ACTION TO BE TAKEN CONCERNING AN ERROR WHICH FORWAY INDUSTRIES, INC., ALLEGES IT MADE IN ITS BID UPON WHICH CONTRACT NO. DA-36-039-SC-75209 WAS AWARDED.

THE RECORD SHOWS THAT BY INVITATION FOR BIDS NO. SC-36-039-57-2187 56 DATED APRIL 17, 1957, THE SIGNAL SUPPLY AGENCY REQUESTED BIDS--- TO BE OPENED ON MAY 7, 1957--- FOR THE FURNISHING OF VARIOUS QUANTITIES OF TEST SET TS-27 ( ( ( TSM AND SUBITEMS, PROVISIONING LIST, TABULAR LIST OF PARTS, AND LITERATURE. IN RESPONSE TO THE INVITATION, FORWAY INDUSTRIES, INC., SUBMITTED A BID DATED MAY 6, 1957, OFFERING TO FURNISH 256 SETS AT $129.50 EACH, PLUS $1,934 FOR THE OTHER ITEMS OF THE INVITATION. ONLY THE ITEM FOR THE 256 TEST SETS ARE INVOLVED HERE AND, AS TO THAT ITEM, THE FOLLOWING RESPONSIVE BIDS WERE RECEIVED:

$129.50--- FORWAY INDUSTRIES, INC.

238.85--- CONNECTICUT TELEPHONE AND ELECTRIC CORP.

240.00--- RADAR PRODUCTS, INC.

285.00--- COLUMBUS ELECTRONICS CORP.

288.00--- GENERAL COMMUNICATION CO. ( ALTERNATE BID)

291.50--- TECHNICAL LABORATORIES, INC.

298.00--- GENERAL COMMUNICATION CO.

IN VIEW OF THE DISPARITY BETWEEN FORWAY'S BID AND THE OTHER BIDS RECEIVED, THE PURCHASING AGENT, WITH THE APPROVAL OF THE CONTRACTING OFFICER, TELEPHONED MR. UHRIG OF FORWAY ON MAY 8, 1957, AND REQUESTED THAT THEY CONFIRM THEIR BID SINCE IT APPEARED THAT ITS PRICE WAS CONSIDERABLY LOWER THAN THE NEXT LOWEST BID. MR. UHRIG WAS ALSO ADVISED OF HIS RIGHT UNDER ASPR 2-405 TO REQUEST RELIEF BECAUSE OF MISTAKE IN BID. AT THE REQUEST OF FORWAY, THE CONTRACTING OFFICER GRANTED ADDITIONAL TIME TO MAY 14, 1957, TO CONFIRM ITS BID. BY LETTER OF MAY 13, 1957, FORWAY CONFIRMED AND VERIFIED ITS FIRM PRICE OF $129.50. AWARD WAS MADE TO FORWAY ON MAY 17, 1957, AT THE PRICES INDICATED.

ON JUNE 4, 1957, FORWAY ADVISED THAT ERROR HAD BEEN MADE IN ITS BID IN THAT HAD CERTAIN MATHEMATICAL AND TYPING ERRORS NOT BEEN MADE, ITS INTENDED BID PRICE WOULD HAVE BEEN $210.477 FOR EACH UNIT. IT APPEARS THAT THE NATURE AND EXTENT OF SUCH ERRORS HAVE BEEN ESTABLISHED BY WORKSHEETS AND SUPPLIERS' QUOTATIONS.

WHILE SOME DISPUTE AROSE AFTER AWARD AS TO WHETHER FORWAY DID, IN FACT, ALLEGE MISTAKE OR REQUEST WITHDRAWAL AT THE TIME THE PURCHASING OFFICER REQUESTED VERIFICATION OF THE BID, THE RECORD DOES NOT SUBSTANTIATE THE CONTRACTOR'S CONTENTIONS, WHICH ARE SPECIFICALLY AND CATEGORICALLY DENIED BY THE PURCHASING OFFICER. SINCE IT VERIFIED AND CONFIRMED ITS BID IN WRITING PRIOR TO AWARD WITHOUT MENTION OF ERROR OR REQUEST FOR WITHDRAWAL, THE CONTRACTOR MUST BE HELD TO HAVE WAIVED THE ERROR.

THE SOLE QUESTION FOR CONSIDERATION IS NOT WHETHER AN ERROR WAS MADE IN THE BID, BUT WHETHER A VALID AND BINDING CONTRACT WAS CONSUMMATED BY THE ACCEPTANCE THEREOF. THE INVITATION WAS CLEAR AND UNAMBIGUOUS AS TO THE GOVERNMENT'S NEEDS. FORWARD WAS ALONE RESPONSIBLE FOR THE PREPARATION OF ITS BID AND WAS GIVEN SUFFICIENT OPPORTUNITY PRIOR TO AWARD TO RECHECK AND RECOMPUTE ITS FIGURES. THE COURT OF CLAIMS IN THE CASE OF FRAZIER-DAVIS CONSTRUCTION COMPANY V. UNITED STATES, 100 C.1CLS. 120, 123, STATED IN LANGUAGE PARTICULARITY APPLICABLE HERE THAT:

* * * THE PARTIES ARE DEALING AT ARMS LENGTH AND BIDDERS ARE PRESUMED TO BE QUALIFIED TO ESTIMATE THE PRICE AT WHICH THEY CAN PERFORM THE WORK SPECIFIED AT A REASONABLE PROFIT. IF THEY FAIL TO DO SO, AS PLAINTIFF DID IN THIS CASE, THE GOVERNMENT CANNOT FOR THAT REASON BE HELD FOR THE RESULTING LOSS.

IT IS CLEAR THAT THE ERROR AS ALLEGED WAS UNILATERAL AND NOT CONTRIBUTED TO BY THE GOVERNMENT, AND HENCE DOES NOT ENTITLE FORWAY TO THE RELIEF CLAIMED. SEE OGDEN AND DOUGHERTY V. UNITED STATES, 103 C.1CLS. 249; SALIGMAN, ET AL. V. UNITED STATES, 56 F.1SUPP. 505. SEE, ALSO, 26 COMP. GEN. 415. 36 ID. 27.

THE RECORD ESTABLISHES THAT THE GOVERNMENT DID ALL THAT WAS REQUIRED OF IT TO ASCERTAIN THE CORRECTNESS OF FORWAY'S BID; IN FACT, FORWAY WAS SPECIFICALLY ADVISED THAT ITS BID WAS CONSIDERABLY LOWER THAN THE NEXT BID. IT WAS NOT UNTIL AFTER FORWAY UNEQUIVOCALLY CONFIRMED ITS BID THAT THE CONTRACTING OFFICER CONSIDERED IT CORRECT AND PROPER FOR AWARD. HAD THE CONTRACTING OFFICER THEREAFTER NOT AWARDED THE CONTRACT TO FORWAY AS THE LOWEST RESPONSIBLE BIDDER, HE WOULD HAVE BEEN DERELICT OF HIS DUTY TO THE GOVERNMENT. SEE CARNEGIE STEEL COMPANY V. CONNELLY, 97 A. 774; SHRIMPTON MFG. COMPANY V. BRIN, 125 S.W. 942; ALABAMA SHIRT AND TROUSER COMPANY V. UNITED STATES, 121 C.1CLS. 313. MOREOVER, THE FACTS OF RECORD PRECLUDE ANY ASSUMPTION OF BAD FAITH OR ARBITRARY ACTION ON THE PART OF THE CONTRACTING OFFICER. 27 COMP. GEN. 17.

THE CONTRACT, AS EXECUTED, REPRESENTED THE FINAL UNDERSTANDING OF THE PARTIES AND FIXED ALL RIGHTS AND LIABILITIES THEREUNDER. THE RIGHT OF THE GOVERNMENT TO RECEIVE PERFORMANCE IN STRICT ACCORDANCE WITH THE CONTRACT TERMS MAY NOT BE WAIVED IN THE ABSENCE OF ADEQUATE CONSIDERATION, AND NO AGENT OF THE GOVERNMENT MAY WAIVE SUCH VESTED RIGHT FOR CONSIDERATIONS OF HARDSHIP OR EQUITIES IN FAVOR OF THE CONTRACTOR. SEE 22 COMP. GEN. 260; DAY V. UNITED STATES, 245 U.S. 159.

WE DO NOT AGREE WITH THE VIEW OF THE CHIEF, LEGAL DIVISION, SIGNAL SUPPLY AGENCY, THAT THE GOVERNMENT DID NOT DISCHARGE ITS DUTY TO FORWAY IN ACCORDANCE WITH THE CRITERIA LAID DOWN IN UNITED STATES V. METRO NOVELTY MFG. CO., INC., 125 F.1SUPP. 713. THE DECISION IN THAT CASE WAS BASED ON THE FACT THAT THE GOVERNMENT DID NOT PUT THE BIDDER "ON NOTICE OF THE MISTAKE WHICH IT SURMISED.' HOWEVER, IN THIS CASE, FORWAY WAS ON NOTICE THAT ITS BID WAS "CONSIDERABLY LOWER THAN THE NEXT LOWEST BID" (QUOTING FROM FORWAY'S LETTER OF JUNE 27, 1957, TO THE CONTRACTING OFFICER) AND THAT WAS THE FULL EXTENT OF THE CONTRACTING OFFICER'S KNOWLEDGE, THERE BEING NOTHING IN THE INVITATION OR BID FROM WHICH HE COULD HAVE EVEN GUESSED AT THE NATURE OR SOURCE OF ERROR. OUR DECISION REPORTED AT 35 COMP. GEN. 136, IS CLEARLY DISTINGUISHABLE SINCE, IN THAT CASE, THE CONTRACTING OFFICER FAILED TO PUT THE BIDDER ON NOTICE OF A SPECIFIC MISTAKE SURMISED AS TO THE INTERPRETATION OF THE SPECIFICATIONS OF THE INVITATION. SUCH IS NOT THE CASE HERE.

ACCORDINGLY, ON THE PRESENT RECORD, NO LEGAL BASIS EXISTS FOR MODIFYING THE PRICE SPECIFIED IN CONTRACT NO. DA-36-039-SE-75209.