B-147046, SEP. 12, 1961

B-147046: Sep 12, 1961

Additional Materials:

Contact:

Edda Emmanuelli Perez
(202) 512-2853
EmmanuelliPerezE@gao.gov

 

Office of Public Affairs
(202) 512-4800
youngc1@gao.gov

TO THE SECRETARY OF THE NAVY: REFERENCE IS MADE TO A LETTER DATED AUGUST 24. TO HAVE BEEN MADE IN HIS BID ON WHICH SALES CONTRACT NO. N61119S-4388 IS BASED. THE OTHER BIDS RECEIVED ON THAT ITEM WERE IN THE AMOUNTS OF $12.80 AND $15.95. IT IS REPORTED THAT THE AVERAGE PRICE FOR LIKE MATERIAL VARIES FROM $15 TO $25. BIDS RECEIVED ON ITEM NO. 17 WERE IN THE AMOUNTS OF $16.95 AND $18.80. AWARD WAS MADE TO JOSE C. WITH THE LETTER WAS TRANSMITTED THE BIDDER'S WORKSHEET CONSISTING OF HIS RETAINED COPY OF THE DESCRIPTIVE PAGES OF THE INVITATION APPARENTLY SUPPORTING THE ALLEGATION THAT THE BID WAS INTENDED TO BE ON ITEM NO. 17 INSTEAD OF NO. 16. THE BASIC QUESTION FOR CONSIDERATION IS NOT WHETHER THE BIDDER MADE A MISTAKE IN HIS BID BUT WHETHER THE ACCEPTANCE OF THE BID BY THE CONTRACTING OFFICER CONSUMMATED A VALID AND BINDING CONTRACT.

B-147046, SEP. 12, 1961

TO THE SECRETARY OF THE NAVY:

REFERENCE IS MADE TO A LETTER DATED AUGUST 24, 1961, FILE NO. R11.3, 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 JOSE C. SANTO TOMAS, AGANA, GUAM, TO HAVE BEEN MADE IN HIS BID ON WHICH SALES CONTRACT NO. N61119S-4388 IS BASED.

BY INVITATION NO. B-134-61-61119, ISSUED JUNE 19, 1961, THE NAVAL SUPPLY DEPOT, GUAM, REQUESTED BIDS--- TO BE OPENED JULY 25, 1961--- FOR THE PURCHASE OF MISCELLANEOUS SPARE PARTS AND OFFICE MACHINES. ITEMS NOS. 16 AND 17 COVERED ADDING MACHINES DESCRIBED AS FOLLOWS:

"16. ADDING MACHINE, MANUAL, MFR. BY BURROUGHS, YEAR N/A, MOD. N/A, SER. A525358, CAP. 10 BANKS. WITHOUT ELECTRIC CORD, ROLLER AND UNIDENTIFIED PARTS MISSING. CONDITION: USED--- POOR. QUANTITY: 1 EACH. ACQUISITION: $265.00.'

"17. ADDING MACHINE, MFR. REMINGTON RAND, MOD. 98, YEAR 1952, SER. 98- 984204E, CONDITION: USED--- FAIR. ACQ. $221.77. QUANTITY: 1 EACH.'

IN RESPONSE TO THE INVITATION, JOSE C. SANTO TOMAS SUBMITTED A BID OF $29.99 ON ITEM NO. 16. THE OTHER BIDS RECEIVED ON THAT ITEM WERE IN THE AMOUNTS OF $12.80 AND $15.95. IT IS REPORTED THAT THE AVERAGE PRICE FOR LIKE MATERIAL VARIES FROM $15 TO $25. BIDS RECEIVED ON ITEM NO. 17 WERE IN THE AMOUNTS OF $16.95 AND $18.80. AWARD WAS MADE TO JOSE C. SANTO TOMAS AS THE HIGH BIDDER ON ITEM NO. 16 (CONTRACT NO. N61119S-4388).

IN A LETTER DATED AUGUST 1, 1961, TO THE CONTRACTING OFFICER, THE CONTRACTOR ALLEGED AN ERROR IN HIS BID, STATING THAT HE INTENDED TO BID ON ITEM NO. 17 INSTEAD OF NO. 16, AND REQUESTED CANCELLATION OF THE AWARD. WITH THE LETTER WAS TRANSMITTED THE BIDDER'S WORKSHEET CONSISTING OF HIS RETAINED COPY OF THE DESCRIPTIVE PAGES OF THE INVITATION APPARENTLY SUPPORTING THE ALLEGATION THAT THE BID WAS INTENDED TO BE ON ITEM NO. 17 INSTEAD OF NO. 16.

THE BASIC QUESTION FOR CONSIDERATION IS NOT WHETHER THE BIDDER MADE A MISTAKE IN HIS 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 THE BIDDER 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.

ALTHOUGH THE BID OF JOSE C. SANTO TOMAS WAS SOMEWHAT HIGHER THAN THE OTHER BIDS RECEIVED ON ITEM NO. 16, 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.'

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 JOSE C. SANTO TOMAS 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. ANY ERROR THAT WAS MADE IN THE BID OF JOSE C. SANTO TOMAS WAS UNILATERAL--- NOT MUTUAL--- AND DOES NOT ENTITLE HIM TO RELIEF FROM HIS OBLIGATION UNDER THE CONTRACT. SEE OGDEN AND DOUGHERTY V. UNITED STATES, 102 CT.CL. 249 AND SALIGMAN ET AL. V. UNITED STATES, 50 F.SUPP. 505, 507.

FOR THE REASONS ABOVE SET FORTH, THE AWARD TO JOSE C. SANTO TOMAS MAY NOT BE CANCELED.