B-144359, MAR. 17, 1961

B-144359: Mar 17, 1961

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GENERAL SERVICES ADMINISTRATION: REFERENCE IS MADE TO REPORT OF JANUARY 3. BECAUSE OF AN ERROR ALLEGED TO HAVE BEEN MADE IN ITS QUOTATION SUBMITTED UNDER SOLICITATION NO. QUOTATION WAS ALSO REQUESTED FOR DELIVERY FAS VESSEL. FNW-IC- 18221-3/7 WAS ISSUED. WE ARE ALSO IN RECEIPT OF A COPY OF THE BIDDER'S LETTER DATED FEBRUARY 15. STATING THAT DELIVERY OF THE SUPPLIES IS BEING WITHHELD PENDING RECEIPT OF FURTHER INSTRUCTIONS. YOUR AGENCY REPORTS THAT BECAUSE OF THE SMALL QUANTITY INVOLVED QUOTATIONS WERE SOLICITED BY WAY OF NEGOTIATION FROM THREE SOURCES. THAT ONLY THE SUBJECT OFFER WAS RECEIVED. WE ARE ALSO ADVISED THAT SINCE THE SUBJECT COMMODITY IS NOT PURCHASED REPETITIVELY. THE CONTRACTING OFFICER WAS NOT AWARE OF A POSSIBLE ERROR.

B-144359, MAR. 17, 1961

TO ADMINISTRATOR, GENERAL SERVICES ADMINISTRATION:

REFERENCE IS MADE TO REPORT OF JANUARY 3, 1961, WITH ENCLOSURES, FROM THE FORMER ADMINISTRATOR, FURNISHED IN RESPONSE TO OUR LETTER OF NOVEMBER 8, 1960, RELATIVE TO THE REQUEST FOR RELIEF OF THE COBRA METAL HOSE COMPANY, CHICAGO, ILLINOIS, BECAUSE OF AN ERROR ALLEGED TO HAVE BEEN MADE IN ITS QUOTATION SUBMITTED UNDER SOLICITATION NO. FM-3H 18221-N-5-25-60.

THE RECORD DISCLOSES THAT IN RESPONSE TO A SOLICITATION FOR A QUOTATION DATED MAY 6, 1960, THE BIDDER OFFERED TO FURNISH THE QUANTITY OF HOSE AND ATTACHMENTS STIPULATED AT A LOT PRICE OF $151.84, F.O.B. ORIGIN, PACKED FOR EXPORT. QUOTATION WAS ALSO REQUESTED FOR DELIVERY FAS VESSEL, NEW ORLEANS, LOUISIANA, AND PURSUANT THERETO THE BIDDER QUOTED A CHARGE OF $17.80, PRESUMABLY INTENDED AS A FREIGHT CHARGE TO BE ADDED TO ITS PRICE FOR THE GOODS. THEREAFTER, ON JUNE 13, 1960, PURCHASE ORDER NO. FNW-IC- 18221-3/7 WAS ISSUED, SETTING FORTH THE LOT PRICE OF $151.84, AND SPECIFYING DELIVERY FAS NEW ORLEANS, BUT OMITTING THE DESIGNATED FREIGHT CHARGES OF $17.80.

UPON RECEIPT OF THE PURCHASE ORDER THE BIDDER, ON JUNE 24, 1960, ALLEGED ERROR IN ITS BID, AND BY LETTER OF AUGUST 1, 1960, IN SUPPORT OF THE ALLEGATION OF ERROR, IT FORWARDED TO YOUR NATIONAL BUYING DIVISION COPIES OF ITS WORKSHEETS SHOWING HOW THE ARITHMETICAL MISTAKE OCCURRED. UNDER DATE OF OCTOBER 21, 1960, THE CONTRACTOR BROUGHT THE MATTER TO OUR ATTENTION WITH A REQUEST THAT WE AUTHORIZE THE RELIEF REQUESTED IN ITS LETTER OF JUNE 24, 1960, SUPRA. WE ARE ALSO IN RECEIPT OF A COPY OF THE BIDDER'S LETTER DATED FEBRUARY 15, 1961, ADDRESSED TO YOUR ADMINISTRATION, STATING THAT DELIVERY OF THE SUPPLIES IS BEING WITHHELD PENDING RECEIPT OF FURTHER INSTRUCTIONS. AN EXAMINATION OF THE REFERRED-TO WORKSHEETS INDICATES THAT THE BIDDER INTENDED TO QUOTE A PRICE OF $856 (SHOWN ON THE WORKSHEET AS $866), INSTEAD OF $151.84, FOR THE MATERIAL F.O.B. PLANT. ADDITION TO THE ERRONEOUS PRICE QUOTATION, INTERVENING CORRESPONDENCE EXCHANGED BETWEEN THE PROCUREMENT OFFICIALS AND THE COMPANY DISCLOSES A LACK OF COMPLETE UNDERSTANDING AS TO THE TYPE AND ASSEMBLY OF THE SUPPLIES TO BE FURNISHED.

YOUR AGENCY REPORTS THAT BECAUSE OF THE SMALL QUANTITY INVOLVED QUOTATIONS WERE SOLICITED BY WAY OF NEGOTIATION FROM THREE SOURCES, AND THAT ONLY THE SUBJECT OFFER WAS RECEIVED. WE ARE ALSO ADVISED THAT SINCE THE SUBJECT COMMODITY IS NOT PURCHASED REPETITIVELY, THE CONTRACTING OFFICER WAS NOT AWARE OF A POSSIBLE ERROR. HOWEVER, NO QUESTION IS RAISED AS TO THE CORRECTNESS OR REASONABLENESS OF THE PRICE OF $8.15 PER FOOT FOR STAINLESS STEEL HOSE, SHOWN ON THE WORKSHEETS SUBMITTED, AND CONSIDERING THE EXTREMELY LOW PRICE QUOTED-- $151.84 FOR 120 FEET OF HOSE AND 30 FITTINGS--- IT WOULD APPEAR THAT THE CONTRACTING OFFICER MIGHT HAVE SUSPECTED THE BIDDER HAD MADE A MISTAKE EVEN THOUGH NO CATALOGUE OR OTHER REFERENCE MATERIAL WAS AVAILABLE OR CONSULTED. IN ANY EVENT, THE RECORD LEAVES LITTLE DOUBT THAT THE CONTRACTOR'S BID WAS ERRONEOUS, AND THAT TO COMPEL THE COMPANY TO FURNISH THE HOSE AND ATTACHMENTS FOR $151.84 FAS NEW ORLEANS, WHEN ITS QUOTATION OF THAT FIGURE, EVEN IGNORING THE ERROR, WAS F.O.B. ITS PLANT, WOULD BE IMPROPER.

ACCORDINGLY, THE PURCHASE ORDER SHOULD BE CANCELLED AND THE PROCUREMENT RENEGOTIATED WITH THE BIDDER OR WITH ANY OTHER AVAILABLE SOURCE OF SUPPLY.