B-143242, DEC. 9, 1960

B-143242, DEC. 9, 1960

TO CHARLES MANUFACTURING COMPANY:

REFERENCE IS MADE TO YOUR LETTER DATED SEPTEMBER 30, 1960, WITH ENCLOSURES, REQUESTING REVIEW OF OFFICE SETTLEMENT DATED JULY 10, 1959, WHICH DISALLOWED YOUR CLAIM FOR $3,141.60 UNDER CONTRACT NO. GS 08S-13512, AS AMENDED.

UNDER THE ORIGINAL CONTRACT WITH THE GENERAL SERVICES ADMINISTRATION, FSS -BUYING DIVISION, DENVER FEDERAL CENTER, YOU AGREED, SUBJECT TO ALL THE TERMS AND CONDITIONS OF THE BID INVITATION WHICH WERE INCORPORATED INTO THE CONTRACT, TO MANUFACTURE AND FURNISH, ON OR BEFORE OCTOBER 27, 1958, 250 UPHOLSTERED CHAIRS AND 90 DAVENPORTS AT A DELIVERED PRICE EACH OF $77.50 AND $153, RESPECTIVELY. THE INVITATION TO BID, NO. 2142, ISSUED JULY 30, 1958-- OPENING DATE OF BIDS AUGUST 15, 1958--- SPECIFIED THAT BOTH THE CHAIRS, ITEM NO. 1, AND DAVENPORTS, ITEM NO. 2, WERE TO BE MANUFACTURED, AS FOLLOWS:

"LIVING ROOM FURNITURE IN ACCORDANCE WITH FED.SPEC.NO. CCC-F-66 AS AMENDED, AND INTERIM FED.SPEC. AA-L-00381D DATED 1/15/58, EXCEPT THAT PARAGRAPHS 3.1., 3.2 AND THAT PORTION OF 2.1 TITLED "DRAWINGS QUARTERMASTER CORPS' ARE NOT APPLICABLE. FURNITURE SHALL BE CLASS 2, METHOD B, WITH SPRING FILLED, COTTON PADDED SEAT AND BACK CUSHIONS, WITH LEVEL C PACKING.

"26-C-4852-160 (7105-634-5413)

CHAIRS, ARM, LOUNGE, LOOSE SEAT AND BACK CUSHIONS, MAHOGANY FINISH, WIDTH 30-INCHES, DEPTH 39-INCHES, HEIGHT 33-INCHES, PLAIN RIB FRIEZE UPHOLSTERY, DRAWING NO. 131, TYPE NO. 231-A, TO MATCH DAVENPORT, TYPE NO. 231.

"26-D-794-190 (7105-227-1619)

DAVENPORTS, THREE-SEAT, LOOSE SEAT AND BACK CUSHIONS, MAHOGANY FINISH, PLAIN RIB FRIEZE UPHOLSTERY, OVER-ALL DIMENSIONS, LENGTH 77 INCHES, DEPTH 39-INCHES, HEIGHT 34-INCHES, INSIDE DIMENSIONS, 68 INCHES, DEPTH 23- INCHES, HEIGHT 17-INCHES, DRAWING 131, TYPE NO. 231; TO MATCH CHAIR, TYPE NO. 231-A.' IT WAS SPECIFIED ALSO THAT, FOR EACH ITEM, THE COLOR OF UPHOLSTERY WOULD BE SELECTED AT TIME OF AWARD. AMENDMENT NO. 1 DATED AUGUST 7, 1958--- RECEIVED BY YOU ON AUGUST 14, 1958--- AMENDED THE INVITATION, AS FOLLOWS:

"PAGE 5 OF INVITATION - 1ST SENTENCE - "FEDERAL SPEC. CCC-F-66" " SHOULD READ:

FED.SPEC. CCC-F-66A DATED MAY 18, 1953.'

IN RESPONSE TO THE INVITATION YOU SUBMITTED A BID DATED AUGUST 12, 1958, WITH PRICE QUOTATIONS OF $77.50 EACH CHAIR IN ITEM NO. 1, AND OF $153 EACH DAVENPORT IN ITEM NO. 2. YOUR BID, BEING THE LOWEST OF ALL BIDS RECEIVED, WAS ACCEPTED AND AWARD WAS MADE BY CONTRACT NO. GS-08S 13512 (PURCHASE ORDER NO. 59DE-2142-1) DATED SEPTEMBER 5, 1958, AT A TOTAL CONTRACT PRICE OF $33,145, AND TIME FOR DELIVERY OF THE FURNITURE WAS FIXED AT DESTINATION ON OR BEFORE OCTOBER 27, 1958.

LATE IN SEPTEMBER 1958, SEVERAL WEEKS AFTER AWARD OF THE CONTRACT, YOU ADVISED THE CONTRACTING OFFICER THAT YOU HAD MADE AN ERROR IN YOUR BID, WHICH YOU ALLEGED WAS DUE TO YOUR MISINTERPRETATION OF THE SPECIFICATIONS SET FORTH IN THE BID INVITATION, IN THAT YOU HAD BASED YOUR BID ON FURNISHING A "100 PERCENT NYLON FRIEZE" COSTING $3.25 PER YARD RATHER THAN A "100 PERCENT MOHAIR FRIEZE" COSTING $4.90 PER YARD, THE DIFFERENCE IN THE COST OF THE TWO MATERIALS BEING $1.65 PER YARD. YOU REQUESTED PERMISSION TO SUBSTITUTE THE NYLON FRIEZE MATERIAL IN MAKING THE FURNITURE.

BECAUSE OF YOUR INABILITY TO OBTAIN THE MOHAIR FRIEZE CALLED FOR BY THE CONTRACT SPECIFICATIONS IN TIME TO MEET GOVERNMENT DELIVERY REQUIREMENTS THE CONTRACTING OFFICER DETERMINED THAT IT WOULD BE ACCEPTABLE TO THE GOVERNMENT TO AMEND THE CONTRACT TO PROVIDE FOR THE FURNITURE TO BE UPHOLSTERED IN "NYLON FRIEZE MATERIAL" IN LIEU OF THE "MOHAIR FRIEZE" CALLED FOR BY THE CONTRACT SPECIFICATIONS, AT A REDUCTION OF $3,141.60 IN THE CONTRACT PRICE. AT THAT TIME IT WAS POINTED OUT TO YOU THAT THE ALTERNATIVE TO AMENDING THE CONTRACT WOULD BE TO TERMINATE YOUR RIGHT TO PROCEED UNDER THE CONTRACT. THE RECORD SHOWS THAT YOU AGREED TO THE PROPOSED AMENDMENT, WITH THE UNDERSTANDING THAT ANY RIGHTS YOU MIGHT HAVE TO FILE A CLAIM FOR THE AMOUNT OF $3,141.60 WOULD NOT BE PREJUDICED BY YOUR ACCEPTANCE OF THE AMENDMENT. ACCORDINGLY, UNDER DATE OF OCTOBER 8, 1958, AMENDMENT NO. 1 TO CONTRACT GS-08S-13512, PROVIDING FOR (1) CHANGE IN DELIVERY DATES, (2) CHANGE FROM "PLAIN RIB FRIEZE, 100 PERCENT MOHAIR," TO "PLAIN RIB FRIEZE, 100 PERCENT NYLON," AND (3) REDUCTION IN THE ORIGINAL CONTRACT PRICE IN THE AMOUNT OF $3,141.60 BECAUSE OF THE CHANGE IN FABRIC REQUIREMENT, WAS ACCEPTED AND SIGNED BY YOU AND BY THE CHIEF, BUYING DIVISION, GENERAL SERVICES ADMINISTRATION, FEDERAL SUPPLY SERVICE (REGION 8) ON BEHALF OF THE GOVERNMENT. UNDER DATE OF OCTOBER 29, AND PURCHASE ORDER NO. 7105-GSA-59-08 (59DE-2142-1) DATED SEPTEMBER 5, 1958, READING AS FOLLOWS:

"AMENDMENT NO. 2

"ABOVE-NUMBERED ORDER IS AMENDED AS FOLLOWS:

"ADD: PATT 988 NYLON FACED RIBBED

FRIEZE, IN ACCORDANCE WITH INVOICE

SUBMITTED TO YOUR FIRM AT UNIT PRICE OF

$3.25 A YARD: BY ISELIN-JEFFERSON CO.,

INC. NOS. GOLD 2047; CORAL 2237;

GREEN 2258; SANDLEWOOD 2245.'

IN ACCORDANCE WITH AMENDMENT NO. 1 TO THE CONTRACT, SHIPMENTS WERE TO BE MADE NOT LATER THAN DECEMBER 15, 22, AND 29, 1958. EACH SHIPMENT WAS ONE DAY LATE PER REPORT FROM THE PACIFIC RAILWAY COMPANY, FOR WHICH A DEDUCTION OF $30 AS LIQUIDATED DAMAGES WAS TAKEN. THE RECORD SHOWS THAT AS OF JANUARY 22, 1959, PAYMENT IN FULL IN THE SUM OF $29,898.39 HAD BEEN MADE TO YOU UNDER THE CONTRACT.

IT IS WELL ESTABLISHED THAT THE ACCEPTANCE OF A BID CONSUMMATES A VALID AND BINDING CONTRACT UNLESS THE OFFICER ACCEPTING THE BID WAS ON NOTICE, EITHER ACTUAL OR CONSTRUCTIVE, OF SUCH CIRCUMSTANCES AS WOULD MAKE HIS ACCEPTANCE AN ACT OF BAD FAITH. SEE IN THIS REGARD 28 COMP. GEN. 550, 551.

IN THE INSTANT CASE, THE SPECIFICATIONS SET FORTH IN THE BID INVITATION WERE CLEAR AND UNAMBIGUOUS, AND NO ERROR WAS ALLEGED BY YOU UNTIL AFTER ACCEPTANCE OF YOUR BID AND AWARD OF CONTRACT NO. GS-08S 13512. YOUR BID WAS REGULAR ON ITS FACE, THE VARIANCE BETWEEN YOUR BID AND THE NEXT LOWEST BID DOES NOT APPEAR TO BE OUT OF LINE, AND THERE IS NOTHING IN THE RECORD TO INDICATE THAT THE CONTRACTING OFFICER OTHERWISE WAS PLACED ON NOTICE OF PROBABILITY OF ERROR IN YOUR BID. THEREFORE, INSOFAR AS THE PRESENT RECORD SHOWS, YOUR BID WAS ACCEPTED IN GOOD FAITH BY THE CONTRACTING OFFICER WITHOUT NOTICE OF ANY ERROR. SUCH ACCEPTANCE CONSUMMATED A VALID AND BINDING CONTRACT WHICH FIXED THE RIGHTS OF THE PARTIES THERETO. THE OBLIGATION OF THE UNITED STATES AS SO FIXED COULD NOT BE SUBSEQUENTLY CHANGED BY ANY ACTION OF THE GOVERNMENT OFFICERS EXCEPT FOR ITS OWN BENEFIT OR UPON SOME NEW AND VALUABLE CONSIDERATION PASSING TO THE GOVERNMENT. SEE PACIFIC HARDWARE CO. V. UNITED STATES, 49 CT.CL. 327; AND 17 COMP. GEN. 560. THE RECORD FURTHER INDICATES THAT IN AMENDING THE CONTRACT IT WAS MUTUALLY AGREED BY YOU AND THE CONTRACTING OFFICER THAT IN CONSIDERATION OF THE SUBSTITUTION OF THE LOWER PRICED "NYLON MATERIAL" FOR THE HIGHER PRICED "MOHAIR MATERIAL" CALLED FOR BY THE CONTRACT, THE ORIGINAL CONTRACT PRICE WOULD BE REDUCED BY THE SUM OF $3,141.60. IT, THEREFORE, MUST BE CONCLUDED THAT THE CONTRACT AS AMENDED WAS VALID AND BINDING ON BOTH CONTRACTING PARTIES, REQUIRING PERFORMANCE IN STRICT ACCORDANCE WITH ITS TERMS.

IN VIEW OF THE FOREGOING, AND AS THE RECORD SHOWS THAT THE CONTRACT HAS BEEN FULLY PERFORMED AND THE CONTRACT PRICE PAID TO YOU IN FULL IN ACCORDANCE WITH THE TERMS OF CONTRACT NO. GS-08S-13512, AS AMENDED, THERE IS NO LEGAL BASIS FOR PAYMENT OF ANY AMOUNT IN ADDITION TO THE PRICE STIPULATED IN THE CONTRACT, AS AMENDED. SEE 20 COMP. GEN. 560 AND COURT CASES CITED THEREIN. THEREFORE, YOUR CLAIM IS DISALLOWED AND THE SETTLEMENT OF JULY 10, 1959, IS SUSTAINED.