B-141819, FEB. 9, 1960

B-141819: Feb 9, 1960

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TO THE SECRETARY OF THE NAVY: REFERENCE IS MADE TO A LETTER DATED JANUARY 22. PROSPECTIVE BIDDERS WERE REQUESTED TO ENTER THEIR BID PRICES ON BID SHEETS. THE ITEMS LISTED FOR SALE WERE OFFERED ON AN "AS IS" AND "WHERE IS" BASIS. A BID DEPOSIT OF 20 PERCENT OF THE TOTAL AMOUNT BID WAS REQUIRED TO ACCOMPANY THE BID IN THE FORM OF POSTAL OR EXPRESS MONEY ORDER. AWARD OF A CONTRACT WAS MADE TO HIM ON OCTOBER 30. WAS INTENDED FOR ITEM 26 (POWER UNIT). WAS BEING RETAINED BUT THAT THE BALANCE WOULD BE RETURNED. THE CHECK CONTAINS ON THE LOWER LEFT-HAND CORNER OF ITS FACE A WRITTEN MEMO WHICH IS NOT ENTIRELY LEGIBLE. THE FIGURE "26" IS DISCERNIBLE AND THE WORDS "GENERATING UNIT" APPEAR TO PRECEDE THE FIGURE.

B-141819, FEB. 9, 1960

TO THE SECRETARY OF THE NAVY:

REFERENCE IS MADE TO A LETTER DATED JANUARY 22, 1960 (R 11.2), WITH ENCLOSURES, FROM THE ASSISTANT CHIEF FOR PURCHASING, BUREAU OF SUPPLIES AND ACCOUNTS, REQUESTING A DECISION AS TO WHETHER RELIEF MAY PROPERLY BE GIVEN IN THE MATTER OF A MISTAKE IN BID ALLEGED AFTER AWARD OF SALES CONTRACT N228A-42856 (SALES INVITATION NO. R-68-68-228) TO M. C. SINNOTT, MINA, NEVADA, BY NAVAL SUPPLY CENTER, OAKLAND, CALIFORNIA.

THE RECORD SHOWS THAT THE NAVAL SUPPLY CENTER, DISPOSAL DEPARTMENT, OAKLAND, CALIFORNIA, BY INVITATION NO. B-68-60-228, REQUESTED BIDS FOR THE PURCHASE FROM THE GOVERNMENT OF MISCELLANEOUS ELECTRICAL AND ELECTRONIC MATERIALS DESCRIBED UNDER ITEMS 1 TO 49C, INCLUSIVE. PROSPECTIVE BIDDERS WERE REQUESTED TO ENTER THEIR BID PRICES ON BID SHEETS, PAGES 5, 6, AND 7 OF THE INVITATION, INSTEAD OF OPPOSITE THE DESCRIPTION OF EACH ITEM. THE BID SHEETS CONTAIN FOUR COLUMNS TITLED (1) ITEM NO., (2) DESCRIPTION, (3) PRICE BID PER UNIT, AND (4) TOTAL PRICE BID. THE ITEMS LISTED FOR SALE WERE OFFERED ON AN "AS IS" AND "WHERE IS" BASIS, WITHOUT RECOURSE AGAINST THE GOVERNMENT. A BID DEPOSIT OF 20 PERCENT OF THE TOTAL AMOUNT BID WAS REQUIRED TO ACCOMPANY THE BID IN THE FORM OF POSTAL OR EXPRESS MONEY ORDER, CASHIER'S CERTIFIED CHECK, CASH, OR COMBINATION THEREOF, AND IN CASE OF DEFAULT BY THE PURCHASER, THE GOVERNMENT RESERVED THE RIGHT TO RETAIN THIS AMOUNT AS LIQUIDATED DAMAGES.

IN RESPONSE TO THE INVITATION, M. C. SINNOTT, MINA, NEVADA, SUBMITTED A BID PRIOR TO BID OPENING ON OCTOBER 22, 1959, FOR ITEM 27 IN THE AMOUNT OF $101.95, ENCLOSED WITH A CHECK FOR THAT AMOUNT. THE BID OFFERED BY MR. SINNOTT, BEING MORE THAN TWICE THAT OF THE NEXT HIGHEST BID RECEIVED ($39.69 FOR ITEM 27, AWARD OF A CONTRACT WAS MADE TO HIM ON OCTOBER 30, 1959.

AFTER AWARD OF THE CONTRACT, IN A LETTER DATED NOVEMBER 2, 1959, MR. SINNOTT ALLEGED AN ERROR IN HIS BID IN THAT THE PRICE OF $101.95 APPEARING OPPOSITE ITEM 27 (RADIO SET), WAS INTENDED FOR ITEM 26 (POWER UNIT). REQUESTED THAT HIS BID AS TO ITEM 27 BE CANCELED AND REFUNDED ENTIRELY, OR IN THE ALTERNATIVE, THAT IT BE MADE APPLICABLE TO ITEM 26. BY LETTER DATED NOVEMBER 18, 1959, THE CONTRACTING OFFICER ADVISED MR. SINNOTT THAT THE SUM OF $20.39, 20 PERCENT OF HIS BID, WAS BEING RETAINED BUT THAT THE BALANCE WOULD BE RETURNED.

IN SUPPORT OF HIS CONTENTION OF ERROR, THE BIDDER HAS FURNISHED HIS SUMMARY BID SHEET, WHICH SHOWS A BID FOR ITEM 26 ON SALES INVITATION NO. B -68-60-228, DESCRIBED AS A POWER UNIT, IN THE AMOUNT OF $101.95. ALSO, A PHOTOSTATIC COPY OF THE DEPOSIT CHECK FOR $101.95 HAS BEEN SUBMITTED. THE CHECK CONTAINS ON THE LOWER LEFT-HAND CORNER OF ITS FACE A WRITTEN MEMO WHICH IS NOT ENTIRELY LEGIBLE, BUT THE FIGURE "26" IS DISCERNIBLE AND THE WORDS "GENERATING UNIT" APPEAR TO PRECEDE THE FIGURE.

THUS, THE FACE OF THE DEPOSIT CHECK CONTAINS A WRITTEN MEMORANDUM WHICH INDICATES AN INCONSISTENCY WITH THE BID. AN EXAMINATION OF THE CHECK TO SEE THAT IT MET THE REQUIREMENTS OF THE INVITATION SHOULD HAVE RAISED A DOUBT ABOUT THE CORRECTNESS OF THE BID. WHEN THIS INCONSISTENCY APPEARING ON THE FACE OF THE DEPOSIT CHECK IS COUPLED WITH A BID PRICE WHICH IS CONSIDERABLY HIGHER THAN THE NEXT HIGHEST BID PRICE RECEIVED FOR THE ITEM, ENOUGH DOUBT IS CREATED SO THAT WE BELIEVE THE CONTRACTING OFFICER SHOULD HAVE REQUESTED THE BIDDER TO VERIFY HIS BID PRIOR TO ITS ACCEPTANCE. SEE B-134431, JANUARY 9, 1958, COPY ENCLOSED.

ACCORDINGLY, IN VIEW OF THE AMBIGUOUS BID SUBMITTED, AND THE FACT THAT THE BIDDER DID ALLEGE AN ERROR PROMPTLY UPON NOTIFICATION OF AWARD, WHICH ERROR HAS BEEN SUFFICIENTLY ESTABLISHED, THE BIDDER MAY BE RELEASED FROM HIS OBLIGATION UNDER CONTRACT NO. N228S-42856 AND THE FULL AMOUNT OF HIS PURCHASE PRICE MAY BE REFUNDED TO HIM.