B-143861, SEP. 16, 1960

B-143861: Sep 16, 1960

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TO THE SECRETARY OF THE ARMY: REFERENCE IS MADE TO LETTER OF AUGUST 22. TO REGLAZE WINDOWS IN BUILDING 98 AT FORT BENJAMIN HARRISON SHOULD BE RESCINDED BECAUSE OF AN ERROR IN BID ALLEGED AFTER THE CONTRACT WAS AWARDED FOLLOWING A VERIFICATION OF THE BID PRICE. A REPRESENTATIVE OF THE FORT MAINTENANCE DEPARTMENT INFORMED THE CONTRACTOR THAT THERE WERE 1. INVITATION AV-12-066-60-125 FOR REGLAZING THE WINDOWS IN BUILDING 98 WAS ISSUED BY THE PROCUREMENT DIVISION OF FORT BENJAMIN HARRISON. BIDS WERE OPENED ON JUNE 29. THE CONTRACTOR'S BID FOR THE WORK WAS $6. THE OTHER BIDS RECEIVED WERE $33. THE POST ENGINEER WAS REQUESTED TO REVIEW HIS ESTIMATE AND HE REAFFIRMED IT. THE CONTRACTING OFFICER INDICATES THAT WHILE HE WAS STILL DISTURBED BY THE UNUSUALLY LARGE RANGE IN BID PRICES.

B-143861, SEP. 16, 1960

TO THE SECRETARY OF THE ARMY:

REFERENCE IS MADE TO LETTER OF AUGUST 22, 1960, WITH ENCLOSURES, FROM THE CHIEF, CONTRACTS BRANCH, PROCUREMENT DIVISION, OFFICE OF THE DEPUTY CHIEF OF STAFF FOR LOGISTICS, REQUESTING A DECISION WHETHER CONTRACT DA-12-066- AV-1801, WITH THE N.E.W. COMPANY, INDIANAPOLIS, INDIANA, TO REGLAZE WINDOWS IN BUILDING 98 AT FORT BENJAMIN HARRISON SHOULD BE RESCINDED BECAUSE OF AN ERROR IN BID ALLEGED AFTER THE CONTRACT WAS AWARDED FOLLOWING A VERIFICATION OF THE BID PRICE.

EARLY IN 1960, THE CONTRACTOR VISITED FORT BENJAMIN HARRISON AND PERFORMED A SAMPLE REGLAZING OPERATION IN BUILDING 98. AT THAT TIME, A REPRESENTATIVE OF THE FORT MAINTENANCE DEPARTMENT INFORMED THE CONTRACTOR THAT THERE WERE 1,350 WINDOWS IN THE BUILDING AND REQUESTED THAT IT SUBMIT A COST ESTIMATE AND SPECIFICATION INFORMATION FOR USE IN PREPARING A BUDGET ESTIMATE AND AN INVITATION FOR BIDS ON REGLAZING THE WINDOWS IN THE BUILDING. IN RESPONSE TO THIS REQUEST, THE CONTRACTOR SUBMITTED PROPOSED SPECIFICATIONS AND A COST BREAKDOWN AND RECOMMENDATION THAT $6,750 BE MADE AVAILABLE FOR THE JOB.

SUBSEQUENTLY, ON JUNE 9, 1960, INVITATION AV-12-066-60-125 FOR REGLAZING THE WINDOWS IN BUILDING 98 WAS ISSUED BY THE PROCUREMENT DIVISION OF FORT BENJAMIN HARRISON. THE INVITATION DID NOT STATE THE NUMBER OF WINDOWS TO BE WORKED ON, BUT RATHER CAUTIONED BIDDERS TO EXAMINE THE SITE TO MAKE THEIR OWN ESTIMATE OF THE WORK TO BE ACCOMPLISHED. HOWEVER, THE CONTRACTOR STATES THAT BEFORE PREPARING ITS BID IT DID NOT MAKE A COUNT OF THE WINDOWS, BUT RATHER RELIED ON THE ORIGINAL INFORMATION FURNISHED BY THE FORT MAINTENANCE DEPARTMENT.

BIDS WERE OPENED ON JUNE 29, 1960. THE CONTRACTOR'S BID FOR THE WORK WAS $6,345. THE OTHER BIDS RECEIVED WERE $33,469 AND $38,324. THE POST ENGINEER ESTIMATED THE JOB AT $5,464.

SINCE THE TWO HIGH BIDS EXCEEDED BY SUCH A LARGE AMOUNT THE GOVERNMENT'S ESTIMATE AND THE LOW BID, THE CONTRACTING OFFICER SUSPECTED THE POSSIBILITY OF SOME ERROR. THE POST ENGINEER WAS REQUESTED TO REVIEW HIS ESTIMATE AND HE REAFFIRMED IT. UPON REQUEST, THE CONTRACTOR VERIFIED ITS BID.

THE CONTRACTING OFFICER INDICATES THAT WHILE HE WAS STILL DISTURBED BY THE UNUSUALLY LARGE RANGE IN BID PRICES, HE WAS MOTIVATED IN MAKING THE AWARD WITHOUT FURTHER DELAY BECAUSE OF THE VERIFICATION BY THE POST ENGINEER AND THE LOW BIDDER AND THE NEED TO OBLIGATE AVAILABLE FUNDS BEFORE THE CLOSE OF THE FISCAL YEAR THE NEXT DAY.

SIX DAYS AFTER AWARD WAS MADE, ONE OF THE COMPANY'S PARTNERS EXAMINED THE SITE AND DISCOVERED THAT THE BUILDING ACTUALLY CONTAINED 6,750 WINDOWS, FIVE TIMES THE AMOUNT ORIGINALLY REPRESENTED. UPON THIS DISCOVERY, THE CONTRACTOR REQUESTED TO BE RELIEVED OF THE CONTRACT OBLIGATION.

THE WORKSHEET SUBMITTED BY THE CONTRACTOR SHOWS THAT ITS ESTIMATE FOR THE BID WAS BASED ON 1,350 WINDOWS. THE GOVERNMENT'S ORIGINAL ESTIMATE OF $5,464 WAS ERRONEOUS ALSO AS ON AUGUST 1 IT WAS REVISED TO $24,384.

WHILE THE CONTRACT DID CAUTION BIDDERS TO ASCERTAIN THE EXTENT OF THE WORK BY ACTUAL VISUAL EXAMINATION OF THE JOB SITE, THE CONTRACT TRANSACTION WAS ENTERED INTO WITH THE ERRONEOUS UNDERSTANDING ON THE PART OF BOTH THE CONTRACTOR AND THE GOVERNMENT THAT THERE WERE NO MORE THAN 1,350 WINDOWS TO REGLAZE. TO REQUIRE THE CONTRACTOR TO NOW ASSUME AT ITS ORIGINAL CONTRACT PRICE RESPONSIBILITY FOR PERFORMANCE OF WORK FIVE TIMES GREATER THAN EITHER PARTY EVER ANTICIPATED WOULD WORK UNJUSTIFIABLE HARM TO THE CONTRACTOR. ACCORDINGLY, SINCE NONE OF THE CONTRACT WORK HAS BEEN PERFORMED, THE CONTRACT SHOULD BE CANCELLED WITHOUT LIABILITY TO EITHER PARTY.