B-142206, MAR. 23, 1960

B-142206: Mar 23, 1960

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 AIR FORCE: REFERENCE IS MADE TO A LETTER DATED MARCH 2. ALLEGED IT MADE IN ITS BID ON WHICH CONTRACT NO. (11-602/S 60-23 IS BASED. SINCE AN AWARD HAS BEEN MADE IN THE PRESENT CASE THE DECISION IS BEING ADDRESSED TO YOU. THE BID OF THE COMPANY WAS ACCEPTED AS TO ITEM 7 ON JANUARY 28. THE COMPANY POINTED OUT THAT THE AMOUNT OF THE BID DEPOSIT SUBMITTED BY IT WAS INSUFFICIENT TO COVER THE PURCHASE PRICE OF THAT ITEM AND THAT FOR THIS REASON ITS BID SHOULD HAVE BEEN REJECTED. ALTHOUGH THE BID OF THE STANDARD RUBBER COMPANY WAS SOMEWHAT HIGHER THAN THE OTHER BIDS RECEIVED ON ITEM 7. IT DOES NOT APPEAR THAT THE DIFFERENCE WAS SO GREAT AS TO HAVE PLACED THE CONTRACTING OFFICER ON NOTICE OF THE PROBABILITY OF ERROR IN THE BID OF THE COMPANY ON THAT ITEM.

B-142206, MAR. 23, 1960

TO THE SECRETARY OF THE AIR FORCE:

REFERENCE IS MADE TO A LETTER DATED MARCH 2, 1960, WITH ENCLOSURES, FILE REFERENCES HMR, FROM THE DEPUTY COMMANDER, CHANUTE TECHNICAL TRAINING CENTER, UNITED STATES AIR FORCE, CHANUTE AIR FORCE BASE, ILLINOIS, REQUESTING A DECISION AS TO THE ACTION TO BE TAKEN CONCERNING AN ERROR WHICH THE STANDARD RUBBER COMPANY, DETROIT, MICHIGAN, ALLEGED IT MADE IN ITS BID ON WHICH CONTRACT NO. (11-602/S 60-23 IS BASED.

SINCE AN AWARD HAS BEEN MADE IN THE PRESENT CASE THE DECISION IS BEING ADDRESSED TO YOU. SEE 26 COMP. GEN. 993; 28 ID. 401; 36 ID. 513.

THE BASE PROCUREMENT OFFICE, CHANUTE AIR FORCE BASE, ILLINOIS, BY INVITATION NO. 11-602-S-60-4 REQUESTED BIDS FOR THE PURCHASE FROM THE GOVERNMENT OF, AMONG OTHER ITEMS, 40,000 POUNDS OF SCRAP AIRCRAFT TIRES, ITEM 7. IN RESPONSES THE STANDARD RUBBER COMPANY SUBMITTED A BID OFFERING TO PURCHASE THE TIRES COVERED BY ITEM 7 AT A PRICE OF $0.0251 PER POUND. THE BID OF THE COMPANY WAS ACCEPTED AS TO ITEM 7 ON JANUARY 28, 1960.

BY LETTER DATED JANUARY 29, 1960, THE COMPANY ADVISED THE BASE PROCUREMENT OFFICE IT HAD MADE AN ERROR IN ITS BID IN THAT IT HAD INTENDED TO BID ON ITEM 8 INSTEAD OF ITEM 7 AND THAT IT HAD NO USE FOR THE AIRCRAFT TIRES COVERED BY ITEM 7. THE COMPANY POINTED OUT THAT THE AMOUNT OF THE BID DEPOSIT SUBMITTED BY IT WAS INSUFFICIENT TO COVER THE PURCHASE PRICE OF THAT ITEM AND THAT FOR THIS REASON ITS BID SHOULD HAVE BEEN REJECTED.

THE ABSTRACT OF BIDS SHOWS THAT THE THREE OTHER BIDDERS ON ITEM 7 QUOTED PRICES OF $0.0129, $0.0115, AND $0.0071 PER POUND. ALTHOUGH THE BID OF THE STANDARD RUBBER COMPANY WAS SOMEWHAT HIGHER THAN THE OTHER BIDS RECEIVED ON ITEM 7, IT DOES NOT APPEAR THAT THE DIFFERENCE WAS SO GREAT AS TO HAVE PLACED THE CONTRACTING OFFICER ON NOTICE OF THE PROBABILITY OF ERROR IN THE BID OF THE COMPANY ON THAT ITEM. IN VIEW OF THE WIDE RANGE OF PRICES ORDINARILY RECEIVED ON WASTE, SALVAGE, AND SURPLUS PROPERTY, A MERE DIFFERENCE IN THE PRICES BID WOULD NOT NECESSARILY PLACE A CONTRACTING OFFICER ON NOTICE OF THE PROBABILITY OF ERROR IN A BID FOR THE PURCHASE OF SUCH PROPERTY FROM THE GOVERNMENT, AS WOULD A LIKE DIFFERENCE IN THE PRICES QUOTED ON NEW EQUIPMENT, SUPPLIES, ETC., TO BE FURNISHED TO THE GOVERNMENT. SEE UNITED STATES V. SABIN METAL CORPORATION, 151 F.SUPP. 683, CITING WITH APPROVAL 16 COMP. GEN. 596; 17 ID. 388; AND ID. 601. SEE, ALSO, 16 COMP. GEN. 976; 28 ID. 261; AND ID. 550. THE PRESENT RECORD INDICATES THAT THE ACCEPTANCE OF THE BID OF THE STANDARD RUBBER COMPANY WAS IN GOOD FAITH, NO ERROR HAVING BEEN ALLEGED UNTIL AFTER AWARD. CONSEQUENTLY, IT MUST BE HELD THAT SUCH ACTION CONSUMMATED A VALID AND BINDING CONTRACT. SEE UNITED STATES V. PURCELL ENVELOPE COMPANY, 249 U.S. 313; AND AMERICAN SMELTING AND REFINING COMPANY V. UNITED STATES, 259 U.S. 75.

MOREOVER, THE RESPONSIBILITY FOR THE PREPARATION OF THE BID SUBMITTED WAS UPON THE BIDDER. SEE FRAZIER-DAVIS CONSTRUCTION CO. V. UNITED STATES, 100 C.CLS. 120, 163. IF, AS STATED IN ITS LETTER OF JANUARY 29, 1960, THE STANDARD RUBBER COMPANY INADVERTENTLY INSERTED THE PRICE INTENDED FOR ITEM 8 OPPOSITE ITEM 7, SUCH ERROR WAS DUE SOLELY TO ITS OWN NEGLIGENCE OR OVERSIGHT AND WAS IN NO WAY INDUCED OR CONTRIBUTED TO BY THE GOVERNMENT. ANY ERROR THAT WAS MADE IN THE BID OF THE COMPANY AS UNILATERAL--- NOT MUTUAL--- AND, THEREFORE, DOES NOT ENTITLE THE COMPANY TO RELIEF FROM ITS OBLIGATION UNDER THE CONTRACT. SEE OGDENAND DOUGHERTY V. UNITED STATES, 102 C.CLS. 249; AND SALIGMAN ET AL. V. UNITED STATES, 50 F.SUPP. 505, 507.

WITH RESPECT TO THE BIDDER'S CONTENTION AS TO THE INSUFFICIENCY OF THE BID DEPOSIT, IT HAS BEEN HELD THAT WHERE THE BID BOND REQUIREMENT HAS BEEN WAIVED THE BIDDER MAY NOT ASSERT HIS FAILURE TO SUPPLY THE BOND AS A BASIS FOR RELIEF. ADALHARDT CONSTRUCTION COMPANY V. UNITED STATES, 123 C.CLS. 456.

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