B-147300, OCT. 16, 1961

B-147300, OCT. 16, 1961

TO THE SECRETARY OF THE NAVY:

REFERENCE IS MADE TO A LETTER DATED SEPTEMBER 26, 1961, WITH ENCLOSURES, FILE R11.4, FROM THE ACTING ASSISTANT CHIEF FOR PURCHASING, BUREAU OF SUPPLIES AND ACCOUNTS, REQUESTING OUR DECISION AS TO WHETHER THERE PROPERLY MAY BE DENIED THE RELIEF SOUGHT BY JACKSON AND BISHOP, STARKE, FLORIDA, UNDER A CONTRACT RESULTING FROM NAVY SPOT BID SALE INVITATION NO. SB-10-62-63072.

IN RESPONSE TO THE INVITATION ISSUED BY THE CONSOLIDATED SURPLUS SALES OFFICE, NAVAL AIR STATION, JACKSONVILLE, FLORIDA, COVERING VARIOUS TYPES OF AIR FORCE EQUIPMENT AND SUPPLIES, JACKSON AND BISHOP SUBMITTED A BID, ACCOMPANIED BY THE REQUIRED 20 PERCENT BID DEPOSIT IN THE AMOUNT OF $500, OFFERING TO PURCHASE ITEM NO. 82, COVERING 1 LOT-- 26 EACH 55 GALLON DRUMS --- OF TRICHLOROETHYLENE FOR A TOTAL PRICE OF $2,472. THE TOTAL ACQUISITION COST FOR THE ITEM IS SHOWN TO HAVE BEEN $1,430. SUBSEQUENT TO AWARD OF THE ITEM ON AUGUST 2, 1961, TO JACKSON AND BISHOP, ON THE BASIS OF THEIR HIGHEST BID, MR. JACKSON ARRIVED AT THE PATRICK AIR FORCE BASE, COCOA, FLORIDA, WHERE THE PROPERTY WAS LOCATED, AND ADVISED THE DISPOSAL AGENT AT THE BASE THAT AN ERROR HAD BEEN MADE IN THE BID, IN THAT IT WAS INTENDED FOR ITEM NO. 84, WHICH COVERED 1 LOT OF TELEPHONE CABLE. MR. JACKSON ADVISED FURTHER THAT HE DID NOT DEAL IN CHEMICALS AND HAD NO KNOWLEDGE OF THEIR VALUE OR USE. IN VIEW OF THE ERROR, HE REQUESTED REFUND OF THE BID DEPOSIT.

WE FIND NOTHING IN THE RECORD BEFORE US THAT CONSTITUTES A LEGAL BASIS FOR CHARGING THE CONTRACTING OFFICER WITH CONSTRUCTIVE NOTICE OF THE PROBABILITY OF ERROR IN THE BID OF JACKSON AND BISHOP FOR ITEM NO. 82. THE FACT THAT THE BID OF JACKSON AND BISHOP FOR THE ITEM WAS CONSIDERABLY HIGHER THAN THE GOVERNMENT'S ACQUISITION COST THEREFOR WOULD NOT APPEAR TO HAVE BEEN PARTICULARLY SIGNIFICANT TO THE CONTRACTING OFFICER SINCE THAT OFFICER REPORTS THAT AS RECENT AS MAY 24, 1961, A GOVERNMENT SALE OF 1 LOT OF TRICHLOROETHYLENE WITH AN ACQUISITION COST OF $1,829.50 WAS MADE TO A CERTAIN CHEMICAL CORPORATION FOR $2,846.27. MOREOVER, WE HAVE INFORMALLY ASCERTAINED FROM A LOCAL CHEMICAL MANUFACTURING COMPANY THAT THE PRICE OF EVEN THE LOWEST GRADE OF TRICHLOROETHYLENE IS NOT ONLY CONSIDERABLY HIGHER THAN THE REPORTED GOVERNMENT'S ACQUISITION COST HERE BUT IS ALSO CONSIDERABLY HIGHER THAN THE BID OF JACKSON AND BISHOP FOR ITEM NO. 82. FINALLY, OUR OFFICE CONSISTENTLY HAS HELD THAT ANY DIFFERENTIAL WHICH EXISTS BETWEEN THE HIGH BID--- JACKSON AND BISHOP'S BID OF $2,472, IN THIS INSTANCE--- AND ALL OTHER BIDS RECEIVED WHICH RANGED FROM $443.87 TO $16.21, DOES NOT, IN AND OF ITSELF, PROVIDE A BASIS FOR ESTABLISHING CONSTRUCTIVE NOTICE OF PROBABILITY OF ERROR IN VIEW OF THE WIDE VARIANCE IN BIDS GENERALLY RECEIVED IN SALES OF GOVERNMENT SURPLUS PROPERTY. UNDER THE CIRCUMSTANCES, WE MUST CONCLUDE THAT THE CONTRACTING OFFICER'S ACCEPTANCE OF THE BID CONSUMMATED A VALID AND BINDING CONTRACT WHICH FIXED THE RIGHTS AND LIABILITIES OF THE PARTIES.

ACCORDINGLY, WE FIND NO LEGAL BASIS FOR GRANTING ANY RELIEF IN THE MATTER.

THE PAPERS, WITH THE EXCEPTION OF THE FINDING OF FACTS AND RECOMMENDATIONS OF THE CONTRACTING OFFICER DATED AUGUST 25, 1961, ARE RETURNED HEREWITH.