B-140282, AUG. 11, 1959

B-140282: Aug 11, 1959

Additional Materials:

Contact:

Edda Emmanuelli Perez
(202) 512-2853
EmmanuelliPerezE@gao.gov

 

Office of Public Affairs
(202) 512-4800
youngc1@gao.gov

TO THE SECRETARY OF THE ARMY: REFERENCE IS MADE TO A LETTER DATED JULY 21. REQUESTING A DECISION AS TO THE ACTION TO BE TAKEN WITH RESPECT TO AN ERROR ALLEGED BY KEYSTONE BOLT AND NUT CORPORATION TO HAVE BEEN MADE IN ITS PROPOSAL ON WHICH CONTRACT NO. (28-024) 59-0195. IS BASED. BIDS WERE REQUESTED FOR FURNISHING VARIOUS ITEMS OF SCREWS AND BOLTS IN ACCORDANCE WITH DESIGNATED SPECIFICATIONS. ONE OTHER BID WAS RECEIVED ON ITEM NO. 9. THERE WAS NOTHING TO PLACE THE CONTRACTING OFFICER ON EITHER ACTUAL OR CONSTRUCTIVE NOTICE THAT KEYSTONE HAD MADE A MISTAKE IN ITS QUOTATION. THE OTHER BIDDER VERIFIED ITS BID PRICE OF ?065 AND INDICATED THAT IT COULD HAVE PERFORMED AT THAT PRICE. GEN. 652 IT IS STATED: "THE ESTABLISHED RULE IS THAT WHERE A BIDDER HAS MADE A MISTAKE IN THE SUBMISSION OF A BID AND THE BID HAS BEEN ACCEPTED.

B-140282, AUG. 11, 1959

TO THE SECRETARY OF THE ARMY:

REFERENCE IS MADE TO A LETTER DATED JULY 21, 1959, FROM THE ASSISTANT SECRETARY (LOGISTICS), WITH ENCLOSURES, REQUESTING A DECISION AS TO THE ACTION TO BE TAKEN WITH RESPECT TO AN ERROR ALLEGED BY KEYSTONE BOLT AND NUT CORPORATION TO HAVE BEEN MADE IN ITS PROPOSAL ON WHICH CONTRACT NO. (28-024) 59-0195, DATED JULY 31, 1958, IS BASED.

BY INVITATION DATED JUNE 24, 1958, BIDS WERE REQUESTED FOR FURNISHING VARIOUS ITEMS OF SCREWS AND BOLTS IN ACCORDANCE WITH DESIGNATED SPECIFICATIONS. IN RESPONSE, KEYSTONE BOLT AND NUT CORPORATION SUBMITTED A BID INCLUDING A QUOTATION OF $3.65 C ON ITEM 9, THE ITEM IN DISPUTE, DESCRIBED IN THE INVITATION AS "BOLT, MACHINE, HEX-HD, DRILLED FOR LOCKING WIRE (3 HOLES), ALLOY STEEL, CAD PLATED, 1/4 - 28 UNF-3A X 1-5/32.' ONE OTHER BID WAS RECEIVED ON ITEM NO. 9-- THAT OF CENTURY FASTENERS CORP. IN THE AMOUNT OF ?065 EACH.

FOLLOWING THE ACCEPTANCE OF ITS BID AND DELIVERY OF THE ITEM THE KEYSTONE BOLT AND NUT CORPORATION, BY LETTER OF NOVEMBER 10, 1958, ADVISED THAT AN ERROR HAD BEEN MADE IN ITS BID ON ITEM NO. 9; THAT A TYPOGRAPHICAL ERROR IN THE PLACEMENT OF THE DECIMAL POINT HAD RESULTED IN A QUOTATION OF $3.65 C INSTEAD OF $36.50 C; AND REQUESTED THAT THE TOTAL PRICE OF $58.40 BE INCREASED TO $584, OR, IN ANY EVENT TO THE AMOUNT OF THE NEXT LOWEST BID.

IT APPEARS FROM THE RECORD THAT THE CONTRACTOR MADE A MISTAKE IN ITS BID, AS ALLEGED; HOWEVER, IT APPEARS FURTHER THAT, IN HIS CONSIDERATION OF THE TWO BIDS RECEIVED, THERE WAS NOTHING TO PLACE THE CONTRACTING OFFICER ON EITHER ACTUAL OR CONSTRUCTIVE NOTICE THAT KEYSTONE HAD MADE A MISTAKE IN ITS QUOTATION. FURTHERMORE, THE OTHER BIDDER VERIFIED ITS BID PRICE OF ?065 AND INDICATED THAT IT COULD HAVE PERFORMED AT THAT PRICE.

IN 20 COMP. GEN. 652 IT IS STATED:

"THE ESTABLISHED RULE IS THAT WHERE A BIDDER HAS MADE A MISTAKE IN THE SUBMISSION OF A BID AND THE BID HAS BEEN ACCEPTED, HE MUST BEAR THE CONSEQUENCE THEREOF UNLESS THE MISTAKE WAS MUTUAL OR THE ERROR WAS SO APPARENT THAT IT MUST BE PRESUMED THE CONTRACTING OFFICER KNEW OF THE MISTAKE AND SOUGHT TO TAKE ADVANTAGE THEREOF. 26 COMP. DEC. 286; 6 COMP. GEN. 526; 8 ID. 362.'

IN THE INSTANT MATTER, IT IS CLEAR THAT SUCH ERROR AS MAY HAVE BEEN MADE WAS NOT MUTUAL AND, AS INDICATED ABOVE, THERE WAS NOTHING TO PLACE THE CONTRACTING OFFICER ON NOTICE OF THE POSSIBILITY OF ERROR. NEITHER WAS THE ALLEGED ERROR INDUCED OR CONTRIBUTED TO BY THE GOVERNMENT. ACCORDINGLY, THE ESTABLISHED RULE ABOVE QUOTED IS FOR APPLICATION HERE. THE ACCEPTANCE OF THE ORDER BY THE CONTRACTOR BY SHIPMENT OF THE SUPPLIES PRIOR TO ANY ALLEGATION OF ERROR BY IT CONSUMMATED A BINDING AND VALID CONTRACT WHICH FIXED THE RIGHTS AND LIABILITIES OF THE PARTIES. SEE UNITED STATES V. PURCELL ENVELOPE COMPANY, 249 U.S. 313; AMERICAN SMELTING AND REFINING COMPANY V. UNITED STATES, 259 U.S. 55; 26 COMP. GEN. 415; 29 ID. 323.

IN THE ABSENCE OF A STATUTE SPECIFICALLY SO PROVIDING NO OFFICER OF THE GOVERNMENT HAS THE AUTHORITY TO GIVE AWAY OR SURRENDER A RIGHT VESTED IN OR ACQUIRED BY THE GOVERNMENT UNDER A CONTRACT. 14 COMP. GEN. 468; 20 ID. 703 AND COURT CASES CITED.

FOR THE REASONS ABOVE SET FORTH, THERE APPEARS NO VALID BASIS FOR ANY ADJUSTMENT IN THE CONTRACT PRICE.

WITH THE EXCEPTION OF THE STATEMENT OF THE CONTRACTING OFFICER, THE PAPERS ARE RETURNED.