B-150839, MAY 1, 1963

B-150839: May 1, 1963

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DEFENSE SUPPLY AGENCY: REFERENCE IS MADE TO LETTER OF FEBRUARY 13. AMONG THE ITEMS OFFERED FOR SALE WERE A "GRINDING MACHINE" (ITEM 91) AND A "GENERATOR SET" (ITEM 92). OF ITEM 91 WAS SET FORTH ON PAGE 15 OF THE SALES CATALOG. THE DESCRIPTION CONTAINED THE INFORMATION THAT THE ITEM WAS "USED. TOTAL ACQUISITION COST) TO THE GOVERNMENT WAS $7. A SPACE WAS PROVIDED WITHIN WHICH A BIDDER COULD INSERT THE PRICE HE WAS WILLING TO PAY FOR THE ITEM. IMMEDIATELY FOLLOWING WAS A PICTURE AND DESCRIPTION OF ITEM 92. THE DESCRIPTION OF THE LATTER ITEM WAS. WHERE THE INFORMATION WAS FURNISHED THAT THE "TAC" WAS $1. A SPACE WAS PROVIDED FOR THE INSERTION OF A BID PRICE. THE HIGH BID FOR ITEM 92 WAS A MAILED-IN BID IN THE AMOUNT OF $1.

B-150839, MAY 1, 1963

TO DIRECTOR, DEFENSE SUPPLY AGENCY:

REFERENCE IS MADE TO LETTER OF FEBRUARY 13, 1963, DSAH-G, FROM THE ASSISTANT COUNSEL OF YOUR AGENCY, REQUESTING A DECISION WHETHER AN AWARD MADE TO REBUILDERS MACHINERY SUPPLY COMPANY FOR ITEM 92 ON SPOT BID SALE 22-S-63-45 MAY BE RESCINDED AND THE BID DEPOSIT RETURNED.

IT APPEARS FROM THE ADMINISTRATIVE REPORT SUBMITTED BY THE SALES CONTRACTING OFFICER IN CONNECTION WITH THIS MATTER THAT BY INVITATION NO. 22-S-63-45, THE DEFENSE SURPLUS SALES OFFICE, MARINE CORPS SUPPLY CENTER, ALBANY, GEORGIA, SOLICITED BIDS FOR THE SALE ON DECEMBER 11, 1962, OF CERTAIN ITEMS OF SURPLUS PERSONAL PROPERTY ON A "SPOT BID" BASIS, AND THAT THE INVITATION DID NOT INCLUDE PERTINENT CONDITIONS OTHER THAN THE "GENERAL SALE TERMS AND CONDITIONS" (STANDARD FORM 114 C, MARCH 1960, REQUIRED BY GSA REG. 1-IV-302.07 (6-10-60) TO BE INCORPORATED IN AUCTION, SPOT BID AND NEGOTIATED SALES).

AMONG THE ITEMS OFFERED FOR SALE WERE A "GRINDING MACHINE" (ITEM 91) AND A "GENERATOR SET" (ITEM 92). A FULL DESCRIPTION, INCLUDING A PICTURE, OF ITEM 91 WAS SET FORTH ON PAGE 15 OF THE SALES CATALOG. THE DESCRIPTION CONTAINED THE INFORMATION THAT THE ITEM WAS "USED, REPAIRS REQUIRED--- FAIR CONDITION" AND THAT THE "TAC" (I.E. TOTAL ACQUISITION COST) TO THE GOVERNMENT WAS $7,880. AT THE CONCLUSION OF THE DESCRIPTION, A SPACE WAS PROVIDED WITHIN WHICH A BIDDER COULD INSERT THE PRICE HE WAS WILLING TO PAY FOR THE ITEM. IMMEDIATELY FOLLOWING WAS A PICTURE AND DESCRIPTION OF ITEM 92. THE DESCRIPTION OF THE LATTER ITEM WAS, HOWEVER, CONCLUDED ON THE OPPOSITE SIDE OF THE PAGE (PAGE 16 OF THE SALES CATALOG), WHERE THE INFORMATION WAS FURNISHED THAT THE "TAC" WAS $1,073, AND A SPACE WAS PROVIDED FOR THE INSERTION OF A BID PRICE.

THE HIGH BID FOR ITEM 92 WAS A MAILED-IN BID IN THE AMOUNT OF $1,361.60, RECEIVED FROM REBUILDERS MACHINERY SUPPLY COMPANY, DALLAS, TEXAS. THE ELEVEN OTHER BIDS RECEIVED FOR THE ITEM RANGED FROM $10 TO $116, MOST OF THE OTHER BIDS RANGING BETWEEN $63 AND $116.

NOTICE OF AWARD WAS ISSUED TO REBUILDERS MACHINERY SUPPLY COMPANY FOR ITEM 92 UNDER DATE OF DECEMBER 11, 1962. HOWEVER, ON DECEMBER 14, 1962, C. C. STANDLEY, THE "OWNER" OF REBUILDERS MACHINERY SUPPLY COMPANY, TELEPHONED THE SALES CONTRACTING OFFICER AND PROTESTED THE AWARD OF THE ITEM TO HIM, STATING THAT HE HAD MADE A MISTAKE IN THAT HE FILLED IN HIS "BID CARD" FOR ITEM 92, INSTEAD OF ITEM 91, AS INTENDED. SUBSTANTIATION OF THE MISTAKE, MR. STANDLEY SUBMITTED TO THE CONTRACTING AGENCY A STATEMENT, SWORN TO BEFORE A NOTARY PUBLIC UNDER DATE OF DECEMBER 14, 1962, REPEATING THE ALLEGATION MADE OVER THE TELEPHONE, AND ENCLOSED PAGE 16-17 OF HIS RETAINED COPY OF THE CATALOG, ON THE PAGE-16 SIDE OF WHICH APPEARS THE FIGURE (IN INK) "1,361.60" IN THE VICINITY OF THE SPACE PROVIDED FOR INSERTING A PRICE FOR ITEM 91.

IN HIS REPORT, THE SALES CONTRACTING OFFICER, AFTER SETTING FORTH THE AMOUNTS OF THE BIDS WHICH WERE RECEIVED FOR ITEM 92, STATES THAT THE UPSET PRICE FURNISHED BY THE "H/A" FOR ITEM 92 WAS $200, AND THE ALBANY DSSO UPSET PRICE WAS $110; ALSO, HE OBSERVES THAT THE ACQUISITION COST FOR THE ITEM WAS $1,073 AND CONCLUDES:

"FROM THE ABOVE, IT IS EVIDENT THE SALES CONTRACTING OFFICER SHOULD HAVE WITHHELD AWARD PENDING VERIFICATION FROM REBUILDERS MACHINE SUPPLY CO.

"8. THE UNDERSIGNED SALES CONTRACTING OFFICER FEELS THAT MR. STANDLEY OF REBUILDERS MACHINE SUPPLY MADE AN HONEST MISTAKE IN THE PREPARATION OF HIS BID CARD AND RECOMMENDS HE BE GRANTED RELIEF OF ITEM 92 ON HIS CONTRACT.'

THE FACTS REASONABLY ESTABLISH THAT C. C. STANDLEY, T/A REBUILDERS MACHINERY SUPPLY COMPANY, MADE THE MISTAKE IN THE SUBMISSION OF HIS BID HERE ALLEGED, AND THE INORDINATE DISPARITY BETWEEN HIS BID AND THE OTHER BIDS RECEIVED FOR ITEM 92, TOGETHER WITH THE INFORMATION RELATIVE TO THE ACQUISITION COST AND ESTIMATED SALES VALUE OF THE ITEM, WAS SUFFICIENT TO PLACE THE CONTRACTING OFFICER ON NOTICE AS TO THE PROBABILITY OF ERROR. IN VIEW THEREOF, THE AWARD OF ITEM 92 TO C. C. STANDLEY, T/A REBUILDERS MACHINERY SUPPLY COMPANY, SHOULD BE DISREGARDED AND THE BID DEPOSIT RETURNED, AS ADMINISTRATIVELY RECOMMENDED. SEE C.N. MONROE MANUFACTURING COMPANY V. UNITED STATES (U.S.DIST.CT.E.D. MICH., S.D; 1956), 143 F.SUPP. 449, 451.

THE VOUCHER (FORM 1034) IN THE AMOUNT OF $300, IN FAVOR OF REBUILDERS MACHINERY SUPPLY COMPANY, COVERING REFUND OF THE DEPOSIT IS RETURNED HEREWITH.