B-144555, DEC. 19, 1960

B-144555: Dec 19, 1960

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TO THE SECRETARY OF THE NAVY: REFERENCE IS MADE TO A LETTER DATED NOVEMBER 29. TO HAVE BEEN MADE IN ITS BID ON WHICH SALES CONTRACT NO. N63068S-47440 IS BASED. THE ORIGINAL ACQUISITION COST OF WHICH IS REPORTED TO HAVE BEEN $3. WHICH WAS ACCOMPANIED BY A BID GUARANTEE IN THE AMOUNT OF $250. WAS ACCEPTED AS TO ITEM 95 ON OCTOBER 12. OF ITEM 95 AND THAT THE ERROR OCCURRED WHEN IT WAS TRANSFERRING ITS BID PRICE FROM ITS WORKSHEET TO THE SUMMARY BID SHEET. THE COMPANY SUBMITTED ITS WORKSHEET WHICH APPEARS TO BE A COPY OF A BIDDER'S SUMMARY SHEET FOR RECORD PURPOSES WHICH WAS ISSUED BY THE GOVERNMENT WITH THE INVITATION. THERE WAS NOTHING ON THE FACE OF THE BID OF THE COMPANY TO INDICATE THAT THE PRICE QUOTED THEREIN FOR ITEM 95 WAS INTENDED FOR ITEM 82.

B-144555, DEC. 19, 1960

TO THE SECRETARY OF THE NAVY:

REFERENCE IS MADE TO A LETTER DATED NOVEMBER 29, 1960, WITH ENCLOSURES, FROM THE ASSISTANT CHIEF FOR PURCHASING, BUREAU OF SUPPLIES AND ACCOUNTS, REQUESTING A DECISION AS TO THE ACTION TO BE TAKEN CONCERNING AN ERROR ALLEGED BY ANDERSON BROS., SAN LORENZO, CALIFORNIA, TO HAVE BEEN MADE IN ITS BID ON WHICH SALES CONTRACT NO. N63068S-47440 IS BASED.

THE U.S. NAVY CONSOLIDATED SURPLUS SALES OFFICE, NAVAL SUPPLY CENTER, OAKLAND, CALIFORNIA, BY INVITATION NO. B-41-61-63068 REQUESTED BIDS FOR THE PURCHASE FROM THE GOVERNMENT OF, AMONG OTHER ITEMS, 21 PISTON AND RING ASSEMBLIES, THE ORIGINAL ACQUISITION COST OF WHICH IS REPORTED TO HAVE BEEN $3,633. IN RESPONSE ANDERSON BROS. SUBMITTED A BID DATED OCTOBER 6, 1960, OFFERING TO PURCHASE, IN ADDITION TO ANOTHER ITEM, THE PISTON AND RING ASSEMBLIES COVERED BY ITEM 95 AT A PRICE OF $8.61 EACH. THE BID OF THE COMPANY, WHICH WAS ACCOMPANIED BY A BID GUARANTEE IN THE AMOUNT OF $250, WAS ACCEPTED AS TO ITEM 95 ON OCTOBER 12, 1960.

BY LETTER DATED OCTOBER 17, 1960, ANDERSON BROS. ADVISED THAT IT HAD MADE AN ERROR IN ITS BID IN THAT IT HAD INTENDED TO BID ON ITEM 82, COVERING STARTERS, INSTEAD OF ITEM 95 AND THAT THE ERROR OCCURRED WHEN IT WAS TRANSFERRING ITS BID PRICE FROM ITS WORKSHEET TO THE SUMMARY BID SHEET. THE COMPANY REQUESTED THAT ITEM 95 OF THE CONTRACT BE CANCELED. SUPPORT OF ITS ALLEGATION OF ERROR, THE COMPANY SUBMITTED ITS WORKSHEET WHICH APPEARS TO BE A COPY OF A BIDDER'S SUMMARY SHEET FOR RECORD PURPOSES WHICH WAS ISSUED BY THE GOVERNMENT WITH THE INVITATION. THE WORKSHEET INDICATES A BID OF $8.61 EACH FOR ITEM 82, STARTERS, BUT IT DOES NOT SHOW A QUOTATION FOR ITEM 95 OR ANY OTHER ITEM.

THERE WAS NOTHING ON THE FACE OF THE BID OF THE COMPANY TO INDICATE THAT THE PRICE QUOTED THEREIN FOR ITEM 95 WAS INTENDED FOR ITEM 82. IT IS REPORTED THAT ONLY ONE OTHER BID IN THE AMOUNT OF $0.42 EACH WAS RECEIVED ON ITEM 95. ALTHOUGH THE BID SUBMITTED BY ANDERSON BROS. WAS CONSIDERABLY HIGHER THAN THE ONLY OTHER BID RECEIVED ON ITEM NO. 95, IT DOES NOT APPEAR THAT THE DIFFERENCE WAS SO GREAT AS TO HAVE PLACED THE CONTRACTING OFFICER ON NOTICE OF THE PROBABILITY OF ERROR IN THE BID OF THE COMPANY. SHOULD BE NOTED IN THIS CONNECTION THAT THE UNIT ACQUISITION COST OF THE PISTON AND RING ASSEMBLIES, DESCRIBED AS "APPARENTLY UNUSED - IN GOOD CONDITION," IS $173. A BID OF $8.61 PER UNIT WOULD NOT SEEM UNREASONABLE TO ANYONE WITH AUTHORITY TO ACCEPT BIDS UNLESS, PERHAPS, IT CAN BE SAID THAT THE PISTON AND RING ASSEMBLIES HAD NO VALUE EXCEPT AS SCRAP. FROM THE RECORD SUBMITTED THERE IS NO INDICATION THAT THIS IS THE CASE. MOREOVER, IN VIEW OF THE WIDE RANGE OF PRICES ORDINARILY RECEIVED ON WASTE, SALVAGE, AND SURPLUS PROPERTY, A MERE DIFFERENCE IN THE PRICES BID WOULD NOT NECESSARILY PLACE A CONTRACTING OFFICER ON NOTICE OF THE PROBABILITY OF ERROR IN A BID FOR THE PURCHASE OF SUCH PROPERTY, AS WOULD A LIKE DIFFERENCE IN THE PRICES QUOTED ON NEW EQUIPMENT OR SUPPLIES TO BE FURNISHED TO THE GOVERNMENT. PRICES OFFERED TO THE GOVERNMENT FOR ITS SURPLUS PROPERTY ARE BASED MORE OR LESS UPON THE USE TO WHICH THE PROPERTY IS TO BE PUT BY THE PARTICULAR BIDDER OR UPON THE RISK OF RESALE WHICH THE BIDDER MIGHT WISH TO TAKE. SEE UNITED STATES V. SABIN METAL CORP., 151 F.SUPP. 683, 689, CITING WITH APPROVAL 16 COMP. GEN. 596; 17 ID. 388; ID. 601. IN THE SABIN CASE, SUPRA, THE PRICE DISPARITY ON THE BIDS RECEIVED FOR THE SALE OF SURPLUS PROPERTY RANGED FROM A LOW OF $337.28 TO A HIGH OF $9,351.30. THE COURT, AT P. 688, SAID:

"THIS BEING A SALE OF SURPLUS ENGINE PARTS, THE CONTRACTING OFFICER HAD NO METHOD OF KNOWING THAT THERE WAS AN ERROR IN THE DEFENDANT'S BID. THE GOVERNMENT WAS INTERESTED ONLY IN GETTING THE HIGHEST POSSIBLE PRICE FOR THE MATERIAL TO BE SOLD; IT WAS NOT IN THE METAL TRADE. THERE IS NO REASON WHY THE SPREAD IN BIDS SHOULD HAVE APPEARED PALPABLE TO THE GOVERNMENT. THE ADMINISTRATIVE AGENCY WAS NOT REQUIRED TO EMPLOY OR UTILIZE EXPERTS FOR THE BENEFIT OF THE DEFENDANT, NOR TO ASSUME THE BURDEN OF EXAMINING EVERY LOW BID FOR POSSIBLE ERROR BY THE BIDDER.'

IN VIEW OF THE FOREGOING AND AS NO ERROR WAS ALLEGED UNTIL AFTER AWARD AND THE BID WAS CLEAR AND UNAMBIGUOUS, IT MUST BE CONCLUDED THAT THE ACCEPTANCE OF THE BID OF ANDERSON BROS. WAS MADE IN GOOD FAITH AND CONSUMMATED A VALID AND BINDING CONTRACT WHICH FIXED THE RIGHTS AND LIABILITIES OF THE PARTIES. THE RESPONSIBILITY FOR THE PREPARATION OF THE BID SUBMITTED IN RESPONSE TO THE INVITATION WAS UPON THE BIDDER. SEE FRAZIER-DAVIS CONSTRUCTION CO. V. UNITED STATES, 100 CT.CL. 120, 163. ANY ERROR THAT WAS MADE IN THE BID OF THE COMPANY WAS UNILATERAL -- NOT MUTUAL --- AND DOES NOT ENTITLE THE COMPANY TO RELIEF FROM ITS OBLIGATION UNDER THE CONTRACT. SEE OGDEN AND DOUGHERTY V. UNITED STATES, 102 CT.CL. 249; AND SALIGMAN, ET AL. V. UNITED STATES, 56 F.SUPP. 505, 507.

ACCORDINGLY, THE AWARD OF ITEM NO. 95 TO ANDERSON BROS. ON SALES CONTRACT NO. N63068S-47440 MAY NOT BE CANCELED.

THE PAPERS, WITH THE EXCEPTION OF THE CONTRACTING OFFICER'S STATEMENT DATED NOVEMBER 2, 1960, ..END :