B-152021, AUG. 14, 1963

B-152021: Aug 14, 1963

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NO ACQUISITION COST WAS STATED. BIDDERS WERE CAUTIONED TO INSPECT THE VEHICLE AT TWIN FALLS. THE BID OF COFFLAND BEING THE HIGHEST RECEIVED ON ITEM 3 WAS ACCEPTED ON APRIL 25. COFFLAND ALLEGED THAT AN ERROR HAD BEEN MADE IN ITS BID IN THAT THE BID OF $456.56 WAS INTENDED FOR ITEM 2 RATHER THAN ITEM 3. THERE WAS NOTHING ON THE FACE OF THE BID TO INDICATE THAT THE PRICE QUOTED FOR ITEM 3 WAS INTENDED FOR ITEM 2. THE ABSTRACT OF BIDS SHOWS THAT THE NEXT HIGHEST BID ON ITEM 3 WAS $240 AND THE LOWEST $61.66. ALTHOUGH THE BID OF COFFLAND WAS CONSIDERABLY HIGHER THAN THE NEXT HIGHEST BID ON ITEM 3. WE DO NOT BELIEVE THE DIFFERENCE WAS SO GREAT AS TO HAVE PLACED THE CONTRACTING OFFICER ON NOTICE OF THE PROBABILITY OF ERROR IN THE BID OF COFFLAND.

B-152021, AUG. 14, 1963

TO THE SECRETARY OF AGRICULTURE:

BY LETTER DATED JULY 11, 1963, WITH ENCLOSURES, THE ADMINISTRATIVE ASSISTANT SECRETARY, REQUESTED OUR DECISION AS TO WHETHER THE SALES CONTRACT AWARDED TO THE COFFLAND MOTOR COMPANY UNDER INVITATION FOR BIDS NO. SCS-12-ID-63 MAY BE RESCINDED AND THE CONTRACTOR RELIEVED OF RESPONSIBILITY FOR DAMAGES TO THE GOVERNMENT BECAUSE OF ITS DEFAULT.

THE SOIL CONSERVATION SERVICE, BOISE, IDAHO, REQUESTED BIDS UNDER ITEM 3 OF THE CITED INVITATION FOR THE PURCHASE OF 1 SEDAN, 4-DOOR, FORD, 1956, MAINLINE. NO ACQUISITION COST WAS STATED, BUT BIDDERS WERE CAUTIONED TO INSPECT THE VEHICLE AT TWIN FALLS, IDAHO. IN RESPONSE THERETO, COFFLAND SUBMITTED A BID ON ITEM 3 IN THE AMOUNT OF $456.56. THE BID OF COFFLAND BEING THE HIGHEST RECEIVED ON ITEM 3 WAS ACCEPTED ON APRIL 25, 1963.

ON MAY 6, 1963, COFFLAND INFORMED THE SALES OFFICE THAT IT DID NOT BID ON ITEM 3. LATER, COFFLAND ALLEGED THAT AN ERROR HAD BEEN MADE IN ITS BID IN THAT THE BID OF $456.56 WAS INTENDED FOR ITEM 2 RATHER THAN ITEM 3. ITEM 2 COVERED A 1/2 TON CHEVROLET 1955 PICKUP TRUCK. COFFLAND THEREUPON REJECTED THE AWARD AND ADVISED THAT IT WOULD DEFAULT ON THE CONTRACT.

THERE WAS NOTHING ON THE FACE OF THE BID TO INDICATE THAT THE PRICE QUOTED FOR ITEM 3 WAS INTENDED FOR ITEM 2. THE ABSTRACT OF BIDS SHOWS THAT THE NEXT HIGHEST BID ON ITEM 3 WAS $240 AND THE LOWEST $61.66. BIDS FOR ITEM 2 RANGED FROM A HIGH OF $516.50 TO A LOW OF $179.66. ALTHOUGH THE BID OF COFFLAND WAS CONSIDERABLY HIGHER THAN THE NEXT HIGHEST BID ON ITEM 3, WE DO NOT BELIEVE THE DIFFERENCE WAS SO GREAT AS TO HAVE PLACED THE CONTRACTING OFFICER ON NOTICE OF THE PROBABILITY OF ERROR IN THE BID OF COFFLAND. MOREOVER, IN VIEW OF THE WIDE RANGE OF PRICES ORDINARILY RECEIVED ON SURPLUS PROPERTY, A DIFFERENCE IN THE PRICES BID WOULD NOT NECESSARILY PLACE A CONTRACTING OFFICER ON NOTICE OF THE PROBABILITY OF ERROR IN BID FOR THE PURCHASE OF SUCH PROPERTY, AS WOULD A LIKE DIFFERENCE IN THE PRICES QUOTED ON NEW EQUIPMENT TO BE FURNISHED TO THE GOVERNMENT. PRICES OFFERED TO THE GOVERNMENT FOR ITS SURPLUS PROPERTY ARE BASED MORE OR LESS UPON THE USE TO WHICH THE PROPERTY IS TO BE PUT BY A PARTICULAR BIDDER OR UPON THE RISK OF RESALE WHICH THE BIDDER MAY WISH TO TAKE. THE CASE OF UNITED STATES V. SABIN METAL CORP., 151 F.SUPP. 683, AFFIRMED 253 F.2D 956, WHERE THE PRICE DISPARITY ON THE SALE OF SURPLUS PROPERTY RANGED FROM A LOW OF $337.28 TO A HIGH OF $9,351.30, THE COURT HELD, AT PAGE 688, THAT:

"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 COFFLAND 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. SEE FRAZIER-DAVIS CONSTRUCTION CO. V. UNITED STATES, 100 CT.CL. 120, 163. ANY ERROR THAT WAS MADE IN THE BID OF COFFLAND WAS UNILATERAL--- NOT MUTUAL--- AND DOES NOT ENTITLE IT TO RELIEF FROM ITS OBLIGATION UNDER THE CONTRACT. SEE EDWIN DOUGHERTY AND M. H. OGDEN V. UNITED STATES, 102 CT.CL. 249; AND SALIGMAN ET AL. V. UNITED STATES, 56 F.SUPP. 505, 507.

ACCORDINGLY, THE SALES CONTRACT MAY NOT BE RESCINDED. SINCE COFFLAND STATED THAT IT WOULD DEFAULT UNDER THE CONTRACT, COFFLAND MAY BE PERMITTED TO FORFEIT 20 PERCENT OF THE PURCHASE PRICE OF ITEM 3 IN ACCORDANCE WITH THE PROVISIONS OF PARAGRAPH 7 OF THE GENERAL SALE TERMS AND CONDITIONS OF THE CONTRACT. AS REQUESTED, THE ENCLOSURES TO THE LETTER OF JULY 11, 1963, ARE RETURNED.