B-141225, DEC. 29, 1959

B-141225, DEC. 29, 1959

TO THE HONORABLE FRANKLIN FLOETE, ADMINISTRATOR, GENERAL SERVICES ADMINISTRATION:

REFERENCE IS MADE TO YOUR LETTER OF NOVEMBER 10, 1959, WITH ENCLOSURES, REQUESTING A DECISION AS TO THE ACTION TO BE TAKEN CONCERNING AN ERROR WHICH THE BARKOFF CONTAINER AND SUPPLY COMPANY ALLEGES IT MADE IN QUOTING ON ITEMS 13 AND 14 OF ITS BID ON WHICH PURCHASE ORDER NO. SF9GN-14557-2 IS BASED.

THE FEDERAL SUPPLY SERVICE, SAN FRANCISCO, CALIFORNIA, BY INVITATION NO. SFN-14557-59, REQUESTED BIDS--- TO BE OPENED FEBRUARY 20, 1959--- FOR FURNISHING VARIOUS ITEMS OF CORRUGATED AND FIBERBOARD BOXES, ITEMS 1 TO 17, INCLUSIVE. UNDER EACH OF THE ITEMS, PROSPECTIVE BIDDERS WERE REQUIRED TO QUOTE A PRICE PER BUNDLE. IN RESPONSE THE BARKOFF CONTAINER AND SUPPLY COMPANY SUBMITTED A BID DATED FEBRUARY 26, 1959, OFFERING TO FURNISH, AMONG OTHERS, THE BOXES UNDER ITEMS 13 AND 14 AT PRICES OF $5.636 PER BUNDLE AND $2.295 PER BUNDLE, RESPECTIVELY. THE BID OF THE COMPANY AS TO ITEMS 5, 13, AND 14 WAS ACCEPTED ON MARCH 10, 1959.

IN HIS UNDATED REPORT THE CONTRACTING OFFICER STATES THAT ON MARCH 18, 1959, A PURCHASE ORDER WAS ISSUED TO THE BARKOFF CONTAINER AND SUPPLY COMPANY REQUESTING DELIVERY OF THE BOXES REQUIRED UNDER ITEMS 5, 13, AND 14, AND THAT IMMEDIATELY UPON RECEIPT THEREOF ON MARCH 19, 1959, THE COMPANY TELEPHONED ALLEGING THAT ITS BID PRICES ON ITEMS 13 AND 14 WERE ERRONEOUS IN THAT THEY WERE BASED ON BUNDLES OF 15 BOXES RATHER THAN 25 BOXES, AS REQUIRED; AND THAT WITH THE THOUGHT THAT HE AS CONTRACTING OFFICER HAD THE AUTHORITY, HE ERRONEOUSLY ISSUED AMENDMENT NO. 1 TO THE PURCHASE ORDER ON MARCH 26, 1959, WHICH AMENDMENT CHANGED THE PRICE OF ITEM 13 TO $9.39325 AND THE PRICE OF ITEM 14 TO $3.825; AND THAT ON THE BASIS OF THIS AMENDMENT, THE COMPANY PROCEEDED WITH SHIPMENT OF THE ORDER, WHICH WAS COMPLETED ON MAY 5, 1959. THE CONTRACTING OFFICER ALSO STATED THAT ON MAY 12, 1959, THE REGIONAL COMPTROLLERS OFFICE QUESTIONED THE ISSUANCE OF THE AMENDMENT TO THE PURCHASE ORDER AND REALIZING THAT HE HAD ISSUED AMENDMENT NO. 1 IN ERROR, HE ISSUED AMENDMENT NO. 2 TO THE PURCHASE ORDER, WHICH CORRECTED THE PRICES TO THE PRICES ORIGINALLY QUOTED BY THE COMPANY.

BY LETTER DATED MAY 14, 1959, THE COMPANY REITERATED ITS ALLEGATION OF ERROR AND REQUESTED THAT THE PRICES OF ITEMS 13 AND 14 BE INCREASED TO $9.39325 AND $3.825, RESPECTIVELY. THE COMPANY STATED THAT IT NOTED THAT ITEM NO. 10 REQUESTED PACKING OF 15 CARTONS PER BUNDLE; THAT BECAUSE OF THIS IT ERRONEOUSLY ASSUMED THAT ITEMS NOS. 11 THROUGH 14 ALSO WERE TO BE PACKED AS 15 PER BUNDLE; THAT IT HAD RECEIVED PER BOX PRICES OF ?37573 EACH AND ?153 EACH FOR ITEMS 13 AND 14 FROM ITS SUPPLIER AND THAT IN ARRIVING AT ITS PER BUNDLE PRICE, IT ERRONEOUSLY MULTIPLIED THE UNIT PRICES BY 15 RATHER THAN BY 25--- THE NUMBER REQUIRED IN EACH BUNDLE. SUPPORT OF ITS ALLEGATION OF ERROR, THE COMPANY BY LETTER DATED MAY 25, 1959, SUBMITTED A COPY OF A LETTER DATED MAY 22, 1959, WHICH IT HAD RECEIVED FROM ITS SUPPLIER, CONTAINER CORPORATION OF AMERICA, WHICH INDICATES THAT THE COMPANY WAS QUOTED A PER CARTON PRICE OF ?37573 EACH FOR ITEM 13 AND A PER CARTON PRICE OF .153 EACH FOR ITEM 14. ON THE BASIS OF THE UNIT PRICES QUOTED BY THE COMPANY'S SUPPLIER FOR ITEMS 13 AND 14, BUNDLES OF 15 WOULD BE $5.636 AND $2.295, RESPECTIVELY, AND BUNDLES OF 25 WOULD BE $9.39325 AND $3.825, RESPECTIVELY.

IT IS REPORTED THAT ON ITEM 13, THE SECOND AND THIRD LOWEST BIDDERS THEREON QUOTED BUNDLE PRICES OF $5.986 AND $5.989 AND THAT THE OTHER BIDDERS THEREON QUOTED PRICES FROM $9.925 TO $13.96375. IT IS ALSO REPORTED THAT ON ITEM 14, THE SECOND AND THIRD LOWEST BIDDERS THEREON QUOTED PRICES OF $2.43 AND $2.433 AND THAT THE OTHER BIDDERS THEREON QUOTED PRICES FROM $4.05 TO $5.43625. IT IS FURTHER REPORTED THAT AFTER THE BARKOFF CONTAINER AND SUPPLY COMPANY ALLEGED ERROR IN ITS BID, THE NEXT TWO LOWEST BIDDERS ON ITEMS 13 AND 14 WERE REQUESTED TO VERIFY THE BASIS ON WHICH THEIR BID PRICES WERE COMPUTED. BY LETTERS DATED JUNE 2 AND JUNE 4, 1959, THE SECOND AND THIRD LOWEST BIDDERS ON ITEMS 13 AND 14 ADVISED THE CONTRACTING OFFICER THAT THEIR BID PRICES ON THOSE ITEMS WERE BASED ON 15 PER BUNDLE.

ON PAGE 6 OF THE INVITATION, AFTER ITEM 9, THE GENERAL DESCRIPTION AND SPECIFICATIONS FOR ITEMS 10 THROUGH 14 ARE SPELLED OUT AND THIS DESCRIPTION INCLUDES THE WORDS "PACKED 25 TO BUNDLE.' UNDER ITEM 10, AFTER THE LISTING OF THE SIZE OF THE BOXES REQUIRED THEREUNDER, APPEAR THE WORDS ,PACKED 15 TO BUNDLE.' ITEMS 11 THROUGH 14 HAVE NO SPECIFIC REFERENCE TO PACK. YOU STATE THAT IT WAS THE INTENTION OF THE INVITATION THAT ITEMS 11 THROUGH 14 BE PACKED 25 UNITS IN A BUNDLE AND THAT SUCH INTENT COULD BE ARRIVED AT FROM A CAREFUL READING THEREOF. YOU ALSO STATE THAT THE PACKING OF 15 BOXES PER BUNDLE MIGHT WELL RESULT FROM A HASTY READING OF THE INVITATION. IT IS ALSO STATED THAT BECAUSE OF THE AMBIGUITY, THE SECOND AND THIRD LOWEST BIDDERS' PRICES ON ITEMS 13 AND 14 WERE ONLY SLIGHTLY ABOVE THE COMPANY'S AND THAT BECAUSE OF THIS, THE CONTRACTING OFFICER WAS NOT ON NOTICE OF THE APPARENT ERROR.

WE ARE OF THE OPINION THAT THE MANNER IN WHICH THE SPECIFICATIONS IN THE PRESENT CASE WERE DRAWN UP WAS TO SOME DEGREE MISLEADING AND SUBJECT TO POSSIBLE MISINTERPRETATION. IN THE CIRCUMSTANCES, THE COMPANY SHOULD NOT BE REQUIRED TO FURNISH THE BOXES UNDER ITEMS 13 AND 14 AT THE PRICES QUOTED IN ITS BID.

ON THE BASIS OF THE FACTS AND EVIDENCE OF RECORD, THERE IS LITTLE ROOM FOR DOUBT THAT THE BARKOFF CONTAINER AND SUPPLY COMPANY MADE A BONA FIDE ERROR IN ITS BID, AS ALLEGED. ACCORDINGLY, IN VIEW OF THE RECORD INDICATING THAT THE PRICES QUOTED BY THE SECOND AND THIRD LOWEST BIDDERS ON ITEMS 13 AND 14 ARE ALSO ERRONEOUS, PAYMENT IS AUTHORIZED TO BE MADE TO THE BARKOFF CONTAINER AND SUPPLY COMPANY FOR THE QUANTITIES OF BOXES DELIVERED UNDER ITEMS 13 AND 14 OF THE CONTRACT AT UNIT PRICES OF $9.39325 AND $3.825, RESPECTIVELY, WHICH UNIT PRICES ARE STILL LOWER THAN THE PRICES SHOWN IN THE NEXT LOWEST CORRECT BID THEREON.

A REFERENCE TO THIS DECISION SHOULD BE MADE ON THE VOUCHER OR VOUCHERS COVERING PAYMENT FOR THE BOXES COVERED BY ITEMS 13 AND 14.

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