B-148178, MAR. 5, 1962

B-148178, MAR. 5, 1962

TO HARMO TIRE AND RUBBER CORPORATION:

REFERENCE IS MADE TO YOUR LETTER OF FEBRUARY 2, 1962, REQUESTING REVIEW OF GENERAL ACCOUNTING OFFICE SETTLEMENT DATED JANUARY 25, 1962, WHICH DISALLOWED YOUR CLAIM IN THE AMOUNT OF $505.75 FOR REFUND OF THE AMOUNT PAID BY YOU UNDER ITEM NO. 3 OF AIR FORCE CONTRACT NO. AF 33 (604) S- 1613.

BY SALES INVITATION NO. IFB 33-604-S-62-7 DATED SEPTEMBER 13, 1961, THE CONSOLIDATED SURPLUS SALES OFFICE, DAYTON AIR FORCE DEPOT, GENTILE AIR FORCE STATION, DAYTON, OHIO, SOLICITED BIDS--- TO BE OPENED OCTOBER 12, 1961--- FOR THE PURCHASE OF NUMEROUS ITEMS OF SURPLUS GOVERNMENT PROPERTY, THE PROPERTY INCLUDED IN ITEM NO. 3 BEING DESCRIBED AS FOLLOWS:

"AIRCRAFT, INNER TUBES, MISCELLANEOUS MAKES AND SIZES, IN THREE EACH YELLOW TUB CONTAINERS, NOT INCLUDED IN SALE.

"USED-FAIR. ESTIMATED GROSS WT: 2,822 LBS.'

THE CONTRACTING OFFICER STATES THAT THE ACQUISITION COST OF THE TUBES WAS $4,276. ITEMS NOS. 1 AND 2 COVERED AIRCRAFT TIRES AND ITEMS NOS. 4, 5, AND 6 COVERED AUTOMOTIVE TIRES.

IN RESPONSE TO THE INVITATION, YOU SUBMITTED A BID ON ITEMS NOS. 1, 2, 3, AND 5 IN A TOTAL AMOUNT OF $3,157.63, YOUR BID ON ITEM NO. 3 BEING $505.75. THE OTHER BIDS RECEIVED ON ITEM NO. 3 WERE IN THE AMOUNTS OF $186.25, $83, $41.67 AND $2.10. YOU MADE A BID DEPOSIT IN THE AMOUNT OF $631.53. AWARD WAS MADE TO YOU AS HIGH BIDDER ON ITEM NO. 3 (CONTRACT NO. AF 33 (604) S-1613) AND YOU WERE SO ADVISED BY A LETTER DATED OCTOBER 17, 1961. THE CONTRACT PRICE WAS RETAINED FROM YOUR BID DEPOSIT.

IN YOUR LETTER DATED OCTOBER 24, 1961, YOU ALLEGED ERROR IN YOUR BID AND REQUESTED THAT THE BID BE WITHDRAWN, STATING THAT YOU HAD THOUGHT THAT ITEM NO. 3 COVERED TIRES INSTEAD OF TUBES.

THE BASIC QUESTION FOR CONSIDERATION IS NOT WHETHER YOU MADE A MISTAKE IN YOUR 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 YOUR NEGLIGENCE 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 YOUR BID WAS MUCH HIGHER THAN THE OTHER BIDS RECEIVED ON ITEM NO. 3, 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; 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 YOUR BID 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 YOUR BID WAS UNILATERAL--- NOT MUTUAL--- AND DOES NOT ENTITLE YOU TO RELIEF FROM YOUR OBLIGATION UNDER THE CONTRACT. SEE DOUGHERTY AND OGDEN V. UNITED STATES, 102 CT.CL. 249; AND SALIGMAN ET AL. V. UNITED STATES, 56 F.SUPP. 505, 507.

FOR THE REASONS ABOVE SET FORTH, THE SETTLEMENT DISALLOWING YOUR CLAIM IS SUSTAINED.