B-141711, JAN. 27, 1960

B-141711: Jan 27, 1960

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TO THE SECRETARY OF THE NAVY: REFERENCE IS MADE TO A LETTER DATED JANUARY 15. N602588-9047 IS BASED. FREITAS' BID ON ITEM 39 WAS ACCEPTED DECEMBER 14. THE CONTRACTOR ADVISED THE SHIPYARD THAT THE BID PLACED AGAINST ITEM 39 WAS INTENDED FOR ITEM 40. THE ABSTRACT OF BIDS SHOWS THAT THE SECOND AND THIRD HIGH BIDS RECEIVED ON ITEM 39 WERE $102.36 AND $101.11. FREITAS WAS EXCESSIVE IN RELATION TO OTHER BIDS RECEIVED. ERROR WAS NOT APPARENT ON THE FACE OF THE BID. FREITAS' BID WAS IN GOOD FAITH. THE RESPONSIBILITY FOR THE PREPARATION OF THE BID SUBMITTED WAS UPON THE BIDDER. SUCH ERROR WAS DUE SOLELY TO HIS OWN NEGLIGENCE OR OVERSIGHT AND WAS IN NO WAY INDUCED OR CONTRIBUTED TO BY THE GOVERNMENT.

B-141711, JAN. 27, 1960

TO THE SECRETARY OF THE NAVY:

REFERENCE IS MADE TO A LETTER DATED JANUARY 15, 1960, WITH ENCLOSURES, FILE R11.2, FROM THE ASSISTANT CHIEF FOR PURCHASING BUREAU OF SUPPLIES AND ACCOUNTS, REQUESTING A DECISION AS TO THE ACTION TO BE TAKEN CONCERNING AN ERROR WHICH MR. ANDREW FREITAS ALLEGES HE MADE ON ITEM 39 OF HIS BID, ON WHICH SALES CONTRACT NO. N602588-9047 IS BASED.

THE LONG BEACH NAVAL SHIPYARD, TORRANCE ANNEX, TORRANCE, CALIFORNIA, BY SITE SALES LETTER NO. SSL-15-60-60258 REQUESTED BIDS FOR THE PURCHASE FROM THE GOVERNMENT OF CERTAIN MISCELLANEOUS MATERIAL AS DESCRIBED THEREIN. RESPONSE THERETO, MR. FREITAS SUBMITTED A BID ON SEVERAL ITEMS, INCLUDING A BID OF $161.97 ON ITEM 39, CONSISTING OF MISCELLANEOUS CANVAS COVERS ON 17 PALLETS. MR. FREITAS' BID ON ITEM 39 WAS ACCEPTED DECEMBER 14, 1959.

BY LETTER OF DECEMBER 23, 1959, THE CONTRACTOR ADVISED THE SHIPYARD THAT THE BID PLACED AGAINST ITEM 39 WAS INTENDED FOR ITEM 40, ONE ELECTRIC WELDER, AND REQUESTED WITHDRAWAL OF AWARD OF ITEM 39.

THE ABSTRACT OF BIDS SHOWS THAT THE SECOND AND THIRD HIGH BIDS RECEIVED ON ITEM 39 WERE $102.36 AND $101.11. THE CONTRACTING OFFICER STATES THAT A REVIEW OF THE BIDS RECEIVED FOR ITEM 39 DID NOT INDICATE THAT THE BID SUBMITTED BY MR. FREITAS WAS EXCESSIVE IN RELATION TO OTHER BIDS RECEIVED. ERROR WAS NOT APPARENT ON THE FACE OF THE BID, AND THE DIFFERENCE BETWEEN THE BIDS RECEIVED ON ITEM 39IS NOT SO GREAT AS TO CHARGE THE CONTRACTING OFFICER WITH CONSTRUCTIVE NOTICE OF THE PROBABILITY OF ERROR IN THE BID. IT FOLLOWS THAT THE ACCEPTANCE OF MR. FREITAS' BID WAS IN GOOD FAITH--- NO ERROR HAVING PREVIOUSLY BEEN ALLEGED--- AND THIS CONSUMMATED A VALID AND BINDING CONTRACT WHICH FIXED THE RIGHTS AND OBLIGATIONS OF THE PARTIES. SEE UNITED STATES V. PURCELL ENVELOPE COMPANY, 249 U.S. 313; AND AMERICAN SMELTING AND REFINING COMPANY V. UNITED STATES, 259 U.S. 75.

THE RESPONSIBILITY FOR THE PREPARATION OF THE BID SUBMITTED WAS UPON THE BIDDER. SEE FRAZIER-DAVIS CONSTRUCTION COMPANY V. UNITED STATES, 100 C.CLS. 120, 163. IF, AS STATED IN HIS LETTER OF DECEMBER 23, 1959, MR. FREITAS INADVERTENTLY BID ON ITEM 39, SUCH ERROR WAS DUE SOLELY TO HIS OWN NEGLIGENCE OR OVERSIGHT AND WAS IN NO WAY INDUCED OR CONTRIBUTED TO BY THE GOVERNMENT. SEE GRYMES V. SANDERS ET AL., 93 U.S. 55, 61. ANY ERROR THAT WAS MADE IN MR. FREITAS' BID WAS UNILATERAL--- NOT MUTUAL--- AND THEREFORE, DOES NOT ENTITLE HIM TO RELIEF. SEE OGDEN AND DOUGHERTY V. UNITED STATES, 102 C.CLS. 249; AND SALIGMAN ET AL. V. UNITED STATES, 56 F.SUPP. 505, 507.

HOWEVER, SINCE THE CONTRACT CONTAINS PARAGRAPH 18 OF THE GENERAL SALE TERMS AND CONDITIONS, WHICH PROVIDES THAT IN THE EVENT THE CONTRACTOR DEFAULTS HE WILL BE LIABLE FOR LIQUIDATED DAMAGES IN A SUM EQUAL TO 20 PERCENT OF THE PURCHASE PRICE, MR. FREITAS IS LIABLE ONLY FOR 20 PERCENT OF THE PURCHASE PRICE OF ITEM 39.