B-144370, NOV. 15, 1960

B-144370, NOV. 15, 1960

TO THE SECRETARY OF THE NAVY:

REFERENCE IS MADE TO SECOND ENDORSEMENT DATED OCTOBER 25, 1960, FILE NO. FR-10 (RH:YW) 7240 (S), FROM THE NAVY REGIONAL ACCOUNTS OFFICE, WASHINGTON, D.C., REQUESTING A DECISION AS TO THE ACTION TO BE TAKEN WITH RESPECT TO AN ERROR ALLEGED BY RAY SLOTKIN, 124 CAMBRIDGE AVENUE, GARDEN CITY, LONG ISLAND, NEW YORK, TO HAVE BEEN MADE IN HIS BID SUBMITTED IN RESPONSE TO INVITATION NO. B-2-61-62776 ISSUED BY THE INSPECTOR OF NAVAL MATERIAL, 495 SUMMER STREET, BOSTON 10, MASSACHUSETTS, UNDER DATE OF AUGUST 10, 1960, FOR THE SALE OF SURPLUS USED EQUIPMENT. THE BID OF RAY SLOTKIN ON ITEM NO. 26 WAS ACCEPTED AND BECAME THE BASIS OF CONTRACT NO. N62776-986 DATED AUGUST 31, 1960.

THE INVITATION REQUESTED BIDS--- TO BE OPENED AUGUST 24, 1960, ON 26 ITEMS OF USED EQUIPMENT DESCRIBED THEREIN. ITEM NO. 25 DESCRIBED A MILLING MACHINE, THE CONDITION OF WHICH WAS STATED TO BE "USED RECOND. FAIR" AND ITS ACQUISITION COST BEING STATED AS $32,430.92. ITEM NO. 26 DESCRIBED A HELICAL GEAR GRINDER, THE CONDITION OF WHICH WAS STATED TO BE "USED RECONDITIONED - FAIR" AND ITS ACQUISITION COST BEING STATED AS $14,625.

IN RESPONSE TO THE INVITATION, RAY SLOTKIN SUBMITTED A BID OF $8,188.88 ON ITEM NO. 26, THAT BEING THE ONLY ITEM ON WHICH HE SUBMITTED A BID. THE ONLY OTHER BID ON ITEM NO. 26 WAS IN THE AMOUNT OF $111. FIVE BIDS WERE RECEIVED ON ITEM NO. 25 IN THE AMOUNTS OF $1,299.99,$1,788, $3,154, $4,000 AND $4,789.92.

ON SEPTEMBER 1, 1960, RAY SLOTKIN CALLED THE CONTRACTING OFFICE BY TELEPHONE AND ALLEGED AN ERROR IN HIS BID, STATING THAT HE INTENDED TO BID ON ITEM NO. 25 INSTEAD OF NO. 26, WHICH ALLEGATION WAS CONFIRMED BY HIS UNDATED LETTER. IN HIS LETTER MR. SLOTKIN STATED IN SUBSTANCE THAT UNTIL HE RECEIVED THE NOTICE OF AWARD HE HAD THOUGHT THAT HE HAD SUBMITTED A BID ON ITEM NO. 25 AS INTENDED AND AS INDICATED ON "THE PENCIL COPY OF THE SALE" IN HIS POSSESSION. HE STATED FURTHER THAT THE BID WAS HASTILY PREPARED AND THAT HE HAD NO NEED FOR THE GEAR GRINDER DESCRIBED IN ITEM NO. 26 AND NO KNOWLEDGE AS TO ITS USE. IT IS TO BE NOTED THAT MR. SLOTKIN'S BID WAS APPROXIMATELY 56 PERCENT OF THE STATED ACQUISITION COST OF THE GEAR GRINDER AND THAT THE AMOUNT OF HIS BID WAS REASONABLY IN LINE WITH THE BIDS RECEIVED ON ITEM NO. 25 ALTHOUGH THE DISPARITY BETWEEN HIS BID AND THE OTHER BID RECEIVED ON ITEM NO. 26 WAS VERY GREAT.

IN VIEW OF THE FACTS OF THIS MATTER AS REPORTED AND SHOWN BY THE FILE, IT MAY BE REGARDED AS SATISFACTORILY ESTABLISHED THAT RAY SLOTKIN MADE A BONA FIDE ERROR IN HIS BID AS ALLEGED AND EXPLAINED BY HIM. ALSO, BECAUSE OF THE DISPARITY BETWEEN HIS BID AND THE ONLY OTHER BID RECEIVED ON ITEM NO. 26 AND BECAUSE OF THE FACT THAT HIS BID ON THAT ITEM WAS CLEARLY EXCESSIVE WHEN CONSIDERED IN RELATION TO THE ACQUISITION COST AND THE CONDITION OF THE GEAR GRINDER AS SET OUT IN THE INVITATION, THERE IS A SOUND BASIS FOR THE CONCLUSION THAT THE CONTRACTING OFFICER SHOULD HAVE REQUESTED VERIFICATION BEFORE MAKING THE AWARD. MOREOVER, IT WOULD SEEM UNCONSCIONABLE TO REQUIRE THE BIDDER TO PAY 56 PERCENT OF THE ACQUISITION COST FOR MACHINERY DESCRIBED AS BEING IN ,USED RECONDITIONED--- FAIR" CONDITION. ACCORDINGLY, THE CONTRACT MAY BE CANCELED WITHOUT LIABILITY TO MR. SLOTKIN.