B-142746, MAY 27, 1960

B-142746: May 27, 1960

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TO THE SECRETARY OF THE ARMY: REFERENCE IS MADE TO A LETTER DATED APRIL 27. TO HAVE BEEN MADE IN ITS BID SUBMITTED ORALLY ON DECEMBER 8. THE CLOSING DATE FOR QUOTATIONS WAS DECEMBER 8. - WAS MADE TO THE HYGRADE FOOD PRODUCTS CORPORATION ON ITS BID OF $0.3345 PER POUND. THE FOUR OTHER BIDS RECEIVED ON THE FRANKFURTERS WERE IN THE AMOUNTS OF $0.3387. IT IS REPORTED THAT APPROXIMATELY ONE-HALF HOUR AFTER RECEIVING THE ORAL NOTICE OF AWARD. A REPRESENTATIVE OF THE HYGRADE FOOD PRODUCTS CORPORATION TELEPHONED ALLEGING THAT AN ERROR HAD BEEN MADE IN THE CORPORATION'S ORAL QUOTATION IN THAT THE PRICE OF THE FRANKFURTERS SHOULD HAVE BEEN QUOTED AS BEING $0.3845 INSTEAD OF $0.3345 PER POUND. THE CORPORATION REQUESTED THAT THE CONTRACT PRICE OF THE FRANKFURTERS BE INCREASED FROM $0.3345 TO $0.3845 PER POUND AND IT STATED THAT THE DIFFERENCE OF FIVE CENTS WAS TO COVER CERTAIN ITEMS OF OVERHEAD AND PROFIT OMITTED FROM ITS BID PRICE.

B-142746, MAY 27, 1960

TO THE SECRETARY OF THE ARMY:

REFERENCE IS MADE TO A LETTER DATED APRIL 27, 1960, WITH ENCLOSURES, FROM THE CHIEF, CONTRACTS BRANCH, PROCUREMENT DIVISION, REQUESTING A DECISION AS TO THE ACTION TO BE TAKEN CONCERNING AN ERROR ALLEGED BY THE KINGAN DIVISION, HYGRADE FOOD PRODUCTS CORPORATION, ORANGEBURG, SOUTH CAROLINA, TO HAVE BEEN MADE IN ITS BID SUBMITTED ORALLY ON DECEMBER 8, 1959, IN RESPONSE TO NOTICE OF INTENT TO PURCHASE NO. COL 119-60, ISSUED BY HEADQUARTERS, COLUMBIA REGION, MILITARY SUBSISTENCE SUPPLY AGENCY, COLUMBIA, SOUTH CAROLINA, FOR FURNISHING 40,000 POUNDS OF FROZEN FRANKFURTERS TO BE DELIVERED TO ATLANTIC COMPANY, 2001 LAUREL STREET, COLUMBIA, SOUTH CAROLINA, ON JANUARY 4, 1960.

THE CLOSING DATE FOR QUOTATIONS WAS DECEMBER 8, 1959, AND ON DECEMBER 9, 1959, ORAL AWARD--- CONFIRMED BY WRITTEN PURCHASE ORDER NO. COL 3517-60--- WAS MADE TO THE HYGRADE FOOD PRODUCTS CORPORATION ON ITS BID OF $0.3345 PER POUND. THE FOUR OTHER BIDS RECEIVED ON THE FRANKFURTERS WERE IN THE AMOUNTS OF $0.3387, $0.3402, $0.372, AND $0.4136 PER POUND. IT IS REPORTED THAT APPROXIMATELY ONE-HALF HOUR AFTER RECEIVING THE ORAL NOTICE OF AWARD, A REPRESENTATIVE OF THE HYGRADE FOOD PRODUCTS CORPORATION TELEPHONED ALLEGING THAT AN ERROR HAD BEEN MADE IN THE CORPORATION'S ORAL QUOTATION IN THAT THE PRICE OF THE FRANKFURTERS SHOULD HAVE BEEN QUOTED AS BEING $0.3845 INSTEAD OF $0.3345 PER POUND. IN A CONFIRMING LETTER DATED DECEMBER 9, 1959, THE CORPORATION REQUESTED THAT THE CONTRACT PRICE OF THE FRANKFURTERS BE INCREASED FROM $0.3345 TO $0.3845 PER POUND AND IT STATED THAT THE DIFFERENCE OF FIVE CENTS WAS TO COVER CERTAIN ITEMS OF OVERHEAD AND PROFIT OMITTED FROM ITS BID PRICE.

THE PRIMARY QUESTION FOR CONSIDERATION IN NOT WHETHER THE HYGRADE FOOD PRODUCTS CORPORATION MADE AN ERROR IN ITS BID BUT WHETHER A VALID AND BINDING CONTRACT WAS CONSUMMATED BY THE ACCEPTANCE THEREOF. THE CONTRACTING OFFICER REPORTS THAT HE WAS NOT ON NOTICE OF ERROR PRIOR TO THE ACCEPTANCE OF THE BID. THE DIFFERENCE BETWEEN THE PRICE QUOTED BY THE HYGRADE FOOD PRODUCTS CORPORATION ON THE FRANKFURTERS AND THE PRICES QUOTED BY THE OTHER BIDDERS WAS NOT SO GREAT AS TO WARRANT A CONCLUSION THAT THE CONTRACTING OFFICER SHOULD HAVE BEEN ON NOTICE OF THE PROBABILITY OF ERROR IN THE BID OF THE CORPORATION. IN THAT CONNECTION, IT IS REPORTED THAT THE PRICE QUOTED BY THE CORPORATION FOR THE FRANKFURTERS WAS HIGHER THAN THE PRICE PAID FOR THE LAST PREVIOUS CARLOAD PURCHASED AND WAS IN LINE WITH THE PRICES PAID BY THE COLUMBIA OFFICE OF THE AGENCY FOR ALL OTHER CARLOAD QUANTITIES OF FRANKFURTERS DURING THE PERIOD NOVEMBER 10, 1959, THROUGH JANUARY 5, 1960. ALTHOUGH, AFTER AWARD, THE CORPORATION FURNISHED CERTAIN DATA IN SUPPORT OF ITS ALLEGATION OF ERROR, IT DOES NOT APPEAR THAT, PRIOR TO AWARD, THE CONTRACTING OFFICER HAD KNOWLEDGE OF THE FACTORS USED BY THE CORPORATION IN COMPUTING ITS BID PRICE. SO FAR AS THE PRESENT RECORD SHOWS, THE ACCEPTANCE OF THE CORPORATION'S BID WAS IN GOOD FAITH--- NO ERROR HAVING BEEN ALLEGED BY THE CORPORATION UNTIL AFTER AWARD. THE ACCEPTANCE OF THE BID, UNDER THE CIRCUMSTANCES INVOLVED, CONSUMMATED A VALID AND BINDING CONTRACT WHICH FIXED THE RIGHTS AND LIABILITIES OF THE PARTIES THERETO. 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 A BID SUBMITTED IN RESPONSE TO AN INVITATION TO BID IS UPON THE BIDDER. SEE FRAZIER DAVIS CONSTRUCTION COMPANY V. UNITED STATES, 100 C.CLS. 120, 163. ANY ERROR IN THE BID WAS IN NO WAY INDUCED OR CONTRIBUTED TO BY THE GOVERNMENT. THEREFORE, SUCH ERROR AS WAS MADE IN THE BID WAS UNILATERAL--- NOT MUTUAL--- AND, THEREFORE, DOES NOT ENTITLE THE CORPORATION TO RELIEF. SEE SALIGMAN ET AL. V. UNITED STATES, 56 F.SUPP. 505, 507; AND OGDEN AND DOUGHERTY V. UNITED STATES, 102 C.CLS. 249, 259.

ACCORDINGLY, ON THE BASIS OF THE PRESENT RECORD, THERE APPEARS TO BE NO LEGAL BASIS FOR MODIFYING THE PRICE SPECIFIED IN PURCHASE ORDER NO. COL 3517-60.

THE PAPERS, WITH THE EXCEPTION OF THE SUCCESSOR CONTRACTING OFFICER'S STATEMENT DATED JANUARY 14, 1960, ARE RETURNED.