B-152745, JAN. 13, 1964

B-152745: Jan 13, 1964

Additional Materials:

Contact:

Edda Emmanuelli Perez
(202) 512-2853
EmmanuelliPerezE@gao.gov

 

Office of Public Affairs
(202) 512-4800
youngc1@gao.gov

TO THE SECRETARY OF THE ARMY: REFERENCE IS MADE TO A LETTER DATED OCTOBER 22. THE ONLY BID RECEIVED ON ITEM 4 WAS SUBMITTED BY AMERICAN ASIATIC DISTRIBUTORS IN THE AMOUNT OF $0.16 EACH. HIGH BID WAS SUBMITTED BY AMERICAN ASIATIC DISTRIBUTORS IN THE AMOUNT OF $1. ITEMS 4 AND 15 WERE AWARDED TO AMERICAN ASIATIC DISTRIBUTORS UNDER CONTRACT FEC-6666. WHICH CONFIRMS THAT AN ERROR WAS MADE ON ITEM 15 INASMUCH AS THE BID ON ITEM 15 WAS INTENDED FOR ITEM 16. THE LOCAL REPRESENTATIVE OF THE AMERICAN ASIATIC DISTRIBUTORS ALLEGED THAT THE MISTAKEN BID ON ITEM 15 WAS DUE TO AN ERROR ON THE PART OF GLOBE WIRELESS IN THE TRANSMITTING OF THE MESSAGE TO HIM FROM HIS PRINCIPAL. THAT IN A COLLATION OF THE INSTRUCTIONS FROM HIS PRINCIPAL HE DID NOT READ CAREFULLY THE REPEAT OF THE MESSAGE AND WAS NOT ALERTED TO THE DISCREPANCY TO THE TEXT OF THE MESSAGE AND ITS REPEAT.

B-152745, JAN. 13, 1964

TO THE SECRETARY OF THE ARMY:

REFERENCE IS MADE TO A LETTER DATED OCTOBER 22, 1963, WITH ENCLOSURES, FROM COLONEL ARTHUR H. WILLIAMS, JR., GS, ASSISTANT DIRECTOR OF PROCUREMENT, OFFICE OF THE ASSISTANT SECRETARY, DEPARTMENT OF THE ARMY, REQUESTING A DECISION AS TO THE ACTION TO BE TAKEN CONCERNING AN ERROR WHICH AMERICAN ASIATIC DISTRIBUTORS, INC., ALLEGES IT MADE IN BIDDING ON ITEMS 4 AND 15 OF SALES INVITATION FOR BIDS NO. 92-127-S-63-149.

THE UNITED STATES ARMY PROPERTY DISPOSAL AGENCY, KOREA, BY THE CITED INVITATION FOR BIDS, REQUESTED BIDS FOR THE PURCHASE FROM THE GOVERNMENT OF, AMONG OTHER THINGS, INSULATORS (ITEM 4) AND VEHICLE SPARE PARTS (ITEM 15). THE ONLY BID RECEIVED ON ITEM 4 WAS SUBMITTED BY AMERICAN ASIATIC DISTRIBUTORS IN THE AMOUNT OF $0.16 EACH. THIS BID REPRESENTS A RETURN OF 80 PERCENT ON THE ACQUISITION COST OF ITEM 4. WITH RESPECT TO ITEM 15, HIGH BID WAS SUBMITTED BY AMERICAN ASIATIC DISTRIBUTORS IN THE AMOUNT OF $1,268. THIS BID REPRESENTS A RETURN OF 11 PERCENT ON THE ACQUISITION COST OF ITEM 15. ON JULY 8, 1963, ITEMS 4 AND 15 WERE AWARDED TO AMERICAN ASIATIC DISTRIBUTORS UNDER CONTRACT FEC-6666. THEREAFTER, BY LETTER DATED JULY 19, 1963, AMERICAN ASIATIC DISTRIBUTORS' LOCAL REPRESENTATIVE ALLEGED A MISTAKEN BID ON ITEMS 4 AND 15. AS EVIDENCE HE STATED THAT HE MISREAD THE TELEGRAM FROM HIS PRINCIPAL DATED JUNE 18, 1963, WHICH TRANSMITTED HIS BID INSTRUCTIONS AND BID $0.16 EACH ON ITEM 4 INSTEAD OF SIX-TENTHS CENTS AS INDICATED IN THE TELEGRAM. IN ADDITION, HE SUBMITTED A CABLE FROM HIS HOME OFFICE DATED JULY 18, 1963, WHICH CONFIRMS THAT AN ERROR WAS MADE ON ITEM 15 INASMUCH AS THE BID ON ITEM 15 WAS INTENDED FOR ITEM 16. THE LOCAL REPRESENTATIVE OF THE AMERICAN ASIATIC DISTRIBUTORS ALLEGED THAT THE MISTAKEN BID ON ITEM 15 WAS DUE TO AN ERROR ON THE PART OF GLOBE WIRELESS IN THE TRANSMITTING OF THE MESSAGE TO HIM FROM HIS PRINCIPAL. HOWEVER, HE ALSO STATES IN A LETTER OF SEPTEMBER 13, 1963, THAT IN A COLLATION OF THE INSTRUCTIONS FROM HIS PRINCIPAL HE DID NOT READ CAREFULLY THE REPEAT OF THE MESSAGE AND WAS NOT ALERTED TO THE DISCREPANCY TO THE TEXT OF THE MESSAGE AND ITS REPEAT.

ALTHOUGH THE BID ON ITEM 4 REPRESENTS AN 80 PERCENT RETURN ON THE ACQUISITION COST OF THE PROPERTY, THE CONTRACTING OFFICER WAS NOT ALERTED TO A POSSIBLE ERROR SINCE THE INSULATORS ARE UNUSED AND THIS IS THE FIRST SALE OF INSULATORS AS A SINGLE ITEM. INSOFAR AS ITEM 15 IS CONCERNED, RECORDS OF PAST SALES OF VEHICLE PARTS REVEAL THAT THE RETURN OF 11 PERCENT ON ACQUISITION COSTS IS NOT A HIGH RETURN. FURTHERMORE, WHILE THE BID ON ITEM 15 WAS HIGHER THAN THE OTHER BIDS RECEIVED, IN VIEW OF THE WIDE RANGE OF PRICES ORDINARILY RECEIVED ON WASTE, SALVAGE AND SURPLUS PROPERTY, A MERE DIFFERENCE IN THE BID PRICES 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, SUPPLIES, ETC., TO BE FURNISHED TO THE GOVERNMENT. SEE UNITED STATES V. SABIN METAL CORPORATION, 151 F.SUPP. 683, CITING WITH APPROVAL 16 COMP. GEN. 596; 17 ID. 388; AND ID. 601. SEE, ALSO, 28 COMP. GEN. 261; AND ID. 550.

THE PRESENT RECORD INDICATES THAT THE ACCEPTANCE OF THE BID OF THE SUBJECT COMPANY WAS IN GOOD FAITH, NO ERROR HAVING BEEN ALLEGED UNTIL AFTER AWARD. CONSEQUENTLY, IT MUST BE HELD THAT SUCH ACTION CONSUMMATED A VALID AND BINDING CONTRACT. THE RESPONSIBILITY FOR THE PREPARATION OF THE BID SUBMITTED WAS UPON THE BIDDER. SEE FRAZIER DAVIS CONSTRUCTION COMPANY V. UNITED STATES, 100 CT.CL. 120, 163. IF AMERICAN ASIATIC DISTRIBUTORS, THROUGH ITS AGENT, MADE AN ERROR IN BID ON ITEM 4 AND 15, SUCH ERROR WAS DUE SOLELY TO ITS OWN NEGLIGENCE AND WAS IN NO WAY INDUCED OR CONTRIBUTED TO BY THE GOVERNMENT. ANY ERROR THAT WAS MADE IN THE BID WAS UNILATERAL-- - NOT MUTUAL--- AND, THEREFORE, DOES NOT ENTITLE THE BIDDER TO RELIEF. SEE OGDEN AND DOUGHERTY V. UNITED STATES, 102 CT.CL. 249; AND SALIGMAN ET AL. V. UNITED STATES, 56 F.SUPP. 505, 507. ..END :