B-145071, MAR. 3, 1961

B-145071: Mar 3, 1961

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TO THE SECRETARY OF THE NAVY: REFERENCE IS MADE TO A LETTER DATED FEBRUARY 13. TO HAVE BEEN MADE IN ITS BID ON WHICH SALES CONTRACT NO. N63066S-357 IS BASED. THE TWO OTHER BIDS RECEIVED ON ITEM NO. 49 WERE IN THE AMOUNTS OF $0.20 AND $0.211 PER UNIT. AWARD WAS MADE TO HABER AIRCRAFT. STATING THAT THE BID SHOULD HAVE BEEN $2.11 EACH INSTEAD OF $21.11 EACH. THAT "WORK SHEETS AND OTHER PROOF OF OUR ERROR IS NOT AVAILABLE. " ALSO STATING THAT IF COMPLETE RELIEF WERE NOT GRANTED IT WAS PREPARED TO LOSE THE 20 PERCENT BID DEPOSIT ON ITEM NO. 49. THE BASIC QUESTION FOR CONSIDERATION IS NOT WHETHER HABER AIRCRAFT. THE INVITATION WAS CLEAR AS TO THE MATERIALS COVERED BY THE VARIOUS ITEMS AND. ANY ERROR WHICH MAY HAVE BEEN MADE WAS DUE SOLELY TO THE NEGLIGENCE OF HABER AIRCRAFT.

B-145071, MAR. 3, 1961

TO THE SECRETARY OF THE NAVY:

REFERENCE IS MADE TO A LETTER DATED FEBRUARY 13, 1961, 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 HABER AIRCRAFT, INC., 3318 BURTON AVENUE, BURBANK, CALIFORNIA, TO HAVE BEEN MADE IN ITS BID ON WHICH SALES CONTRACT NO. N63066S-357 IS BASED.

BY INVITATION NO. B-18-61-63066 ISSUED DECEMBER 13, 1960, THE CONSOLIDATED SURPLUS SALES OFFICE, NEWPORT, RHODE ISLAND, REQUESTED BIDS-- - TO BE OPENED JANUARY 5, 1961--- FOR THE PURCHASE OF 156 ITEMS OF AERONAUTICAL MATERIAL, THE PROPERTY INCLUDED IN ITEM NO. 49 BEING DESCRIBED AS FOLLOWS:

"49. ADAPTERS: MFG. DOUGLAS AIRCRAFT CO., INC., NO. K-15103. UNUSED, APPARENTLY EXCELLENT. ACQ. COST: $2950.00. EST. WT. 50 LBS. APPROX. CUBE - 11.

NOT PACKED FOR SHIPMENT.

QUANTITY 25 EA.'

IN RESPONSE TO THE INVITATION, HABER AIRCRAFT, INC., SUBMITTED A BID ON SEVERAL ITEMS IN THE TOTAL AMOUNT OF $1,442.72, INCLUDING A BID OF $21.11 EACH (TOTAL $527.75) ON ITEM NO. 49, ACCOMPANIED BY A CASHIER'S CHECK IN THE AMOUNT OF $300. THE TWO OTHER BIDS RECEIVED ON ITEM NO. 49 WERE IN THE AMOUNTS OF $0.20 AND $0.211 PER UNIT. ON JANUARY 10, 1961, AWARD WAS MADE TO HABER AIRCRAFT, INC., ON ITEMS NOS. 49, 129, 147 AND 149 IN THE TOTAL AMOUNT OF $583.94 (CONTRACT NO. N63066S-357).

IN A LETTER DATED JANUARY 11, 1961, TO THE CONTRACTING OFFICER, HABER AIRCRAFT, INC., ALLEGED AN ERROR IN ITS BID ON ITEM NO. 49, STATING THAT THE BID SHOULD HAVE BEEN $2.11 EACH INSTEAD OF $21.11 EACH, AND REQUESTED THAT THE BID ON ITEM NO. 49 BE CANCELED. IN RESPONSE TO A REQUEST BY THE CONTRACTING OFFICER FOR PROOF OF THE ERROR AND OF THE INTENDED BID, THE CONTRACTOR STATED IN ITS LETTER OF JANUARY 23, 1961, THAT "WORK SHEETS AND OTHER PROOF OF OUR ERROR IS NOT AVAILABLE, SINCE WE WORK FROM THE BID SHEET," ALSO STATING THAT IF COMPLETE RELIEF WERE NOT GRANTED IT WAS PREPARED TO LOSE THE 20 PERCENT BID DEPOSIT ON ITEM NO. 49.

THE BASIC QUESTION FOR CONSIDERATION IS NOT WHETHER HABER AIRCRAFT, INC., MADE A MISTAKE IN ITS BID BUT WHETHER THE ACCEPTANCE OF THE BID BY THE CONTRACTING OFFICER CONSUMMATED A VALID AND BINDING CONTRACT. THE INVITATION WAS CLEAR AS TO THE MATERIALS COVERED BY THE VARIOUS ITEMS AND, THEREFORE, ANY ERROR WHICH MAY HAVE BEEN MADE WAS DUE SOLELY TO THE NEGLIGENCE OF HABER AIRCRAFT, INC., AND SUCH ERROR WAS IN NO WAY CONTRIBUTED TO BY THE GOVERNMENT. THE BID SUBMITTED WAS UNAMBIGUOUS AND THERE WAS NOTHING ON ITS FACE TO INDICATE ERROR. IT IS TO BE NOTED ALSO THAT THERE HAS BEEN SUBMITTED NO ACTUAL EVIDENCE THAT THE BID WAS ERRONEOUS.

ALTHOUGH THE BID OF HABER AIRCRAFT, INC., WAS MUCH HIGHER THAN THE TWO OTHER BIDS RECEIVED ON ITEM NO. 49, 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. 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 BE MADE OF THE PROPERTY BY THE PARTICULAR BIDDER OR UPON THE RISK OF RESALE WHICH THE BIDDER MIGHT DESIRE TO TAKE. SEE UNITED STATES V. SABIN METAL CORPORATION, 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 PAGE 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.'

FOR THE REASONS ABOVE SET FORTH, THE AWARD TO HABER AIRCRAFT, INC., MAY NOT BE CANCELED.