B-147775, DEC. 27, 1961

B-147775, DEC. 27, 1961

TO THE SECRETARY OF THE NAVY:

REFERENCE IS MADE TO A LETTER (CSX-6ABO:ALW) DATED DECEMBER 8, 1961, WITH ENCLOSURES, FROM THE COMMANDANT OF THE MARINE CORPS, CONCERNING A MISTAKE ALLEGED BY NATHAN S. COLEN AND SON, INC., LOS ANGELES, CALIFORNIA, TO HAVE BEEN MADE IN ITS BID ON WHICH SALES CONTRACT NO. N62204-7162 (ITEM NO. 14 OF SALES INVITATION NO. B-53-62) WAS AWARDED TO IT.

BY THE INVITATION, CONSOLIDATED SURPLUS SALES OFFICE, MARINE CORPS SUPPLY CENTER, BARSTOW, CALIFORNIA, SOLICITED BIDS--- OPENING DATE OCTOBER 18, 1961--- FOR THE PURCHASE FROM THE GOVERNMENT OF 19 ITEMS OF SURPLUS SCRAP MATERIAL AS LISTED AND DESCRIBED THEREIN. ITEMS NOS. 13 AND 14, HERE INVOLVED, WERE DESCRIBED (PAGE 12), RESPECTIVELY, AS 2,050 POUNDS OF "SCRAP BRASS" AND 3,000 POUNDS OF "SCRAP WOOD AMMUNITION BOXES.' RESPONSE TO THE INVITATION, NATHAN S. COLEN AND SON, INC., SUBMITTED A BID DATED OCTOBER 16, 1961, WITH PRICE QUOTATIONS ON THREE ITEMS, AS FOLLOWS:

CHART

ITEM NO. QUANTITY UNIT OF PRICE BID TOTAL PRICE

(NO. OF UNITS) MEASURE PER UNIT BID

14 3,000 POUND $0.1708 $350.14

17 1,100 POUND 0.0612 67.32

18 4,645 POUND 0.2126 987.53

TOTAL BID ON THIS PAGE $1,404.99

AND A DEPOSIT OF $300 ACCOMPANIED THE BID. ON PAGE 5 OF THE INVITATION IT WAS PROVIDED THAT ,IN CASE OF ERROR IN THE EXTENSION: UNIT PRICE GOVERNS.'

IN EVALUATING ALL BIDS RECEIVED PURSUANT TO THE INVITATION, THE RECORD SHOWS THAT THE CONTRACTING OFFICER NOTED THAT COLEN'S EXTENDED TOTAL PRICE OF $350.14 FOR ITEM NO. 14 WAS IN ERROR AND, IN ACCORDANCE WITH THE CITED BID INVITATION PROVISION, HE RECOMPUTED THE TOTAL BID PRICE FOR THAT ITEM TO BE $512.40 (3,000 POUNDS TIMES $0.1708 PER POUND). THE FIRM'S BID, BEING THE ONLY BID RECEIVED ON ITEM NO. 14, WAS ACCEPTED ON OCTOBER 23, 1961, IN THE TOTAL PRICE AS CORRECTED, TOGETHER WITH ITS BID OF $987.53 ON ITEM NO. 18, THEREBY CONSUMMATING CONTRACT NO. N62204-7162 IN THE TOTAL CONTRACT PRICE OF $1,499.93. SUBSEQUENTLY, AFTER RECEIPT OF THE NOTICE OF AWARD TO IT OF ITEMS NOS. 14 AND 18, NATHAN S. COLEN AND SON, INC., ADVISED THE CONTRACTING OFFICER THAT IT HAD MADE AN ERROR IN ITS BID IN THAT THE PRICE OF $0.1708 PER POUND AND A TOTAL OF $350.14 WAS INTENDED FOR ITEM NO. 13 RATHER THAN ITEM NO. 14 AS APPEARED ON ITS BID. FOR THIS REASON THE PURCHASER REQUESTED THAT ITS BID BE WITHDRAWN OR THE PRICE FIGURE BE PLACED ON ITEM NO. 13, THE ITEM IT INTENDED TO BID ON. IN SUPPORT OF THE ALLEGATION OF ERROR, THE PURCHASER SUBMITTED A COPY OF ITS WORKSHEET WHICH INDICATES THAT THE BID WAS INTENDED FOR ITEM NO. 13, AS CLAIMED, AND THAT THE QUANTITY OF MATERIAL STATED FOR ITEM NO. 13 TIMES THE UNIT BID PRICE QUOTED EQUALS THE TOTAL BID PRICE STATED IN ITS BID FOR ITEM NO. 14.

THE ESTABLISHED RULE IS THAT, WHERE A BIDDER HAS MADE A MISTAKE IN THE SUBMISSION OF A BID AND THE BID HAS BEEN ACCEPTED AND AWARD OF A CONTRACT MADE, THE CONTRACTOR MUST BEAR THE CONSEQUENCES OF THE ERROR UNLESS THE MISTAKE WAS MUTUAL OR THE OFFICER ACCEPTING THE BID WAS ON NOTICE, EITHER ACTUAL OR CONSTRUCTIVE, OF SUCH CIRCUMSTANCES AS WOULD MAKE HIS ACCEPTANCE AN ACT OF BAD FAITH. 39 COMP. GEN. 36.

WHILE IT MAY BE THAT NATHAN S. COLEN AND SON, INC., MAY HAVE MADE AN ERROR IN ITS BID, AS ALLEGED, IT IS CLEAR THAT SUCH ERROR WAS IN NO WAY INDUCED OR CONTRIBUTED TO BY THE GOVERNMENT, BUT WAS DUE SOLELY TO THE NEGLIGENCE OF THE BIDDER IN THE PREPARATION OF ITS BID. CONSEQUENTLY, SUCH ERROR WAS UNILATERAL--- NOT MUTUAL. THERE WAS NOTHING ON THE FACE OF THE CONTRACTOR'S BID TO INDICATE THAT THE PRICE QUOTATION ON ITEM NO. 14 WAS NOT INTENDED FOR THAT ITEM, OR TO PUT THE CONTRACTING OFFICER OTHERWISE ON NOTICE OF THE PROBABILITY OF THE ALLEGED ERROR IN THE BID. NATHAN S. COLEN AND SON, INC., DID NOT ALLEGE ERROR IN ITS BID UNTIL AFTER ACCEPTANCE OF ITS BID AND AWARD OF THE CONTRACT TO IT. THUS, SO FAR AS THE RECORD SHOWS, THE ACCEPTANCE OF THE BID, WITHOUT ACTUAL OR CONSTRUCTIVE NOTICE OF THE ERROR, AS ALLEGED, WAS IN GOOD FAITH AND CONSUMMATED A VALID AND BINDING CONTRACT WHICH FIXED THE RIGHTS AND LIABILITIES OF THE PARTIES THERETO. UNITED STATES V. PURCELL ENVELOPE COMPANY, 249 U.S. 313; AND AMERICAN SMELTING AND REFINING COMPANY V. UNITED STATES, 259 U.S. 75. THE CONTRACT VESTED IN THE GOVERNMENT THE RIGHT TO HAVE PERFORMANCE IN STRICT ACCORDANCE WITH THE TERMS OF THE ACCEPTED BID AND NO OFFICER OF THE GOVERNMENT HAS AUTHORITY TO GIVE AWAY OR SURRENDER ANY RIGHT VESTED IN THE GOVERNMENT OR ACQUIRED BY IT UNDER A CONTRACT. UNITED STATES V. AMERICAN SALES CORPORATION, 27 F.2D 389, AFFIRMED 32 F.2D 141, CERTIORARI DENIED 280 U.S. 574; BAUSCH AND LOMB OPTICAL COMPANY V. UNITED STATES, 78 CT.CL. 584, 607, CERTIORARI DENIED 292 U.S. 645; AND PACIFIC HARDWARE AND STEEL COMPANY V. UNITED STATES, 49 CT.CL. 327, 335.

IN VIEW OF THE FOREGOING, THERE IS NO LEGAL BASIS FOR RELIEVING NATHAN S. COLEN AND SON, INC., OF ITS OBLIGATIONS AS TO ITEM NO. 14ON SALES CONTRACT NO. N62204-7162.