B-144229, OCT. 19, 1960

B-144229: Oct 19, 1960

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TO THE SECRETARY OF THE ARMY: REFERENCE IS MADE TO A LETTER DATED OCTOBER 12. AFTER THE AWARD WAS MADE A REPRESENTATIVE OF THE CORPORATION VERBALLY ALLEGED THAT AN ERROR HAD BEEN MADE IN ITS BID FOR ITEM NO. 117. THE CORPORATION EXPLAINED THAT THE ERROR OCCURRED WHEN ITS REPRESENTATIVE BELIEVED THAT THE PARTS COVERED BY ITEM NO. 117 WERE THE SAME AS THOSE COVERED BY ITEM NO. 116. - IS NOT UNUSUAL. PARTICULARLY SINCE A WIDE RANGE OF PRICES ORDINARILY ARE RECEIVED ON GOVERNMENT SALES OF WASTE. WHEN CONSIDERING THAT THE TOTAL ACQUISITION COST FOR THE 35 SHAFT GEARS COVERED BY ITEM NO. 117 WAS $2. THERE APPEARS NO BASIS TO CONCLUDE THAT THE CONTRACTING OFFICER SHOULD HAVE SUSPECTED THE PROBABILITY OF ERROR IN THE BID AT THE TIME OF ITS ACCEPTANCE AND.

B-144229, OCT. 19, 1960

TO THE SECRETARY OF THE ARMY:

REFERENCE IS MADE TO A LETTER DATED OCTOBER 12, 1960, WITH ENCLOSURES, FORWARDED IN BEHALF OF THE ASSISTANT SECRETARY OF THE ARMY FOR LOGISTICS, BY THE DEPUTY THE QUARTERMASTER GENERAL, REQUESTING OUR DECISION AS TO THE APPROPRIATE ACTION TO BE TAKEN REGARDING AN AWARD OF ITEM NO. 117 UNDER SPOT BID SALE INVITATION NO. 33-063-S-60-20, IN VIEW OF AN ERROR ALLEGEDLY MADE IN THE BID FOR THAT ITEM.

THE PROPERTY DISPOSAL OFFICER OF THE MARION ENGINEER DEPOT, AWARDED, AMONG OTHERS, ITEM NO. 117 TO THE S AND G PARTS MANUFACTURING AND EQUIPMENT CORPORATION ON THE BASIS OF ITS HIGH SPOT BID OF $527 FOR THE 35 BEVEL SHAFT GEARS COVERED BY THE ITEM. AFTER THE AWARD WAS MADE A REPRESENTATIVE OF THE CORPORATION VERBALLY ALLEGED THAT AN ERROR HAD BEEN MADE IN ITS BID FOR ITEM NO. 117. BY LETTER DATED JULY 27, 1960, THE CORPORATION EXPLAINED THAT THE ERROR OCCURRED WHEN ITS REPRESENTATIVE BELIEVED THAT THE PARTS COVERED BY ITEM NO. 117 WERE THE SAME AS THOSE COVERED BY ITEM NO. 116, UPON WHICH IT PREVIOUSLY HAD SUBMITTED AN UNSUCCESSFUL BID. THE CORPORATION REQUESTS THAT ITEM NO. 117 BE CANCELED FROM THE AWARD.

WE BELIEVE THE RECORD SUBSTANTIATES THE OPINION OF THE DEPUTY THE QUARTERMASTER GENERAL THAT THE VARIATION IN THE BID PRICES RECEIVED FOR ITEM NO. 117--- $527, $388.88, $34.11, $31.50, AND $22.68--- IS NOT UNUSUAL, PARTICULARLY SINCE A WIDE RANGE OF PRICES ORDINARILY ARE RECEIVED ON GOVERNMENT SALES OF WASTE, SALVAGE AND SURPLUS PROPERTY. MOREOVER, WHEN CONSIDERING THAT THE TOTAL ACQUISITION COST FOR THE 35 SHAFT GEARS COVERED BY ITEM NO. 117 WAS $2,508/10, THE RATE OF RETURN AS REFLECTED BY THE HIGH BID OF $527 THEREFORE MAY NOT BE HELD TO BE EXCESSIVE. THUS, THERE APPEARS NO BASIS TO CONCLUDE THAT THE CONTRACTING OFFICER SHOULD HAVE SUSPECTED THE PROBABILITY OF ERROR IN THE BID AT THE TIME OF ITS ACCEPTANCE AND, THEREFORE, THE ACCEPTANCE CONSUMMATED A VALID AND BINDING CONTRACT WHICH FIXED THE RIGHTS AND LIABILITIES OF THE PARTIES.

ACCORDINGLY, WE FIND NO LEGAL BASIS TO AUTHORIZE A CANCELLATION OF ITEM NO. 117 FROM THE CONTRACT.

THE PAPERS, WITH THE EXCEPTION OF THE REPORT OF THE DEPUTY THE QUARTERMASTER GENERAL AND THE STATEMENTS OF THE PROPERTY DISPOSAL OFFICER AND COLONEL JAMES L. MASSEY, ARE RETURNED HEREWITH.