B-143136, JUN. 27, 1960

B-143136: Jun 27, 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 ARMY: REFERENCE IS MADE TO LETTER OF JUNE 7. BECAUSE OF AN ERROR ALLEGED TO HAVE BEEN MADE IN ITS BID SUBMITTED IN RESPONSE TO INVITATION FOR BIDS NO. EIGHT OTHER COMPETITIVE BIDS WERE RECEIVED RANGING IN PRICE FROM .11 TO ?27 PER FOOT. WAS ISSUED WITHOUT VERIFICATION AS TO THE CORRECTNESS OF THE AMOUNT BID. UPON WHICH ITS BID OF ?045 WAS COMPUTED. IS A REGULAR DEALER IN SUCH EQUIPMENT WAS NOT AWARE OF THE ERROR. THERE IS NO EXPLANATION IN THE FILE AS TO WHY THE CONTRACTING OFFICER FAILED TO DETECT THE PROBABILITY OF ERROR IN THE CONTRACTOR'S PRICE. THERE DOES NOT APPEAR TO BE ANY DOUBT BUT THAT THE ERROR WAS MADE AS ALLEGED. THAT THE CONTRACTOR'S CLAIM IS IN GOOD FAITH.

B-143136, JUN. 27, 1960

TO THE SECRETARY OF THE ARMY:

REFERENCE IS MADE TO LETTER OF JUNE 7, 1960, WITH ENCLOSURES, FROM THE OFFICE OF THE DEPUTY CHIEF OF STAFF FOR LOGISTICS, REFERRING TO US FOR DETERMINATION THE QUESTION AS TO WHETHER THERE MAY BE GRANTED THE RELIEF REQUESTED BY L. F. GAUBERT AND COMPANY, NEW ORLEANS, LOUISIANA, BECAUSE OF AN ERROR ALLEGED TO HAVE BEEN MADE IN ITS BID SUBMITTED IN RESPONSE TO INVITATION FOR BIDS NO. SC-36-039-59-887-C1, ISSUED BY THE UNITED STATES ARMY SIGNAL SUPPLY AGENCY AT PHILADELPHIA, PENNSYLVANIA.

THE FACTS OF RECORD DISCLOSE THAT IN RESPONSE TO THE SUBJECT INVITATION DATED APRIL 30, 1959, THE COMPLAINING BIDDER SUBMITTED AN OFFER TO FURNISH 47,500 FEET OF ELECTRICAL POWER CABLE AT A UNIT PRICE OF $0.45 PER FOOT. EIGHT OTHER COMPETITIVE BIDS WERE RECEIVED RANGING IN PRICE FROM .11 TO ?27 PER FOOT. UNDER DATE OF JULY 16, 1959, AWARE OF PURCHASE ORDER CONTRACT NO. 9043-PP-60-C1-51, WAS ISSUED WITHOUT VERIFICATION AS TO THE CORRECTNESS OF THE AMOUNT BID. THEREAFTER, THE CONTRACTOR REQUESTED CANCELLATION OF THE PURCHASE ORDER FOR THE REASON THAT ITS SUPPLIER HAD WITHDRAWN, BECAUSE OF AN ALLEGED ERROR, A PRIOR COMMITMENT TO SUPPLY THE CABLE TO THE CONTRACTOR AT A UNIT PRICE OF ?0434 PER FOOT, UPON WHICH ITS BID OF ?045 WAS COMPUTED.

THE RECORD FAILS TO DISCLOSE HOW THE CONTRACTOR'S SUPPLIER MADE THE MISTAKE IN ITS ORIGINAL QUOTATION, NOR WHY THE CONTRACTOR WHO, PRESUMABLY, IS A REGULAR DEALER IN SUCH EQUIPMENT WAS NOT AWARE OF THE ERROR. LIKEWISE, THERE IS NO EXPLANATION IN THE FILE AS TO WHY THE CONTRACTING OFFICER FAILED TO DETECT THE PROBABILITY OF ERROR IN THE CONTRACTOR'S PRICE, IN VIEW OF THE WIDE DISPARITY BETWEEN THE LOW BID AND THE REMAINING BIDS SUBMITTED, AND PARTICULARLY SINCE THE COMMODITY APPEARS TO BE A STANDARD AND HIGHLY COMPETITIVE GENERAL SUPPLY ARTICLE.

HOWEVER, CONSIDERING ALL THE FACTS AND CIRCUMSTANCES IN THIS CASE, THERE DOES NOT APPEAR TO BE ANY DOUBT BUT THAT THE ERROR WAS MADE AS ALLEGED; THAT THE CONTRACTOR'S CLAIM IS IN GOOD FAITH; AND, THAT THE MATERIAL DIFFERENCE IN PRICE BETWEEN THE LOW BID AND THE REMAINING QUOTATIONS SUBMITTED WAS MORE THAN SUFFICIENT TO WARRANT AN INQUIRY AS TO ITS CORRECTNESS BEFORE AWARD.

IN THE CIRCUMSTANCES WE CONCUR WITH THE CONCLUSIONS AND RECOMMENDATIONS OF THE ACTING DEPUTY CHIEF SIGNAL OFFICER THAT THE RELIEF REQUESTED BY L. F. GAUBERT AND COMPANY SHOULD BE GRANTED, AND THEREFORE THE SUBJECT PURCHASE ORDER MAY BE CANCELLED WITHOUT LIABILITY.