B-153822, APR. 3, 1964

B-153822: Apr 3, 1964

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TO PUBLIC PRINTER: REFERENCE IS MADE TO YOUR LETTER OF MARCH 26. ALLEGES IT MADE IN ITS BID WHICH WAS ACCEPTED MARCH 10. IT IS REPORTED THAT ON FEBRUARY 27. THE BIDS WERE OPENED ON MARCH 6. THE LOW BID WAS ACCEPTED AND GPO PURCHASE ORDER NO. 5789. WAS ISSUED AND FORWARDED TO HOLLISTON. IN WHICH HE STATED THAT THE PURCHASE ORDER HAD BEEN BROUGHT TO HIS ATTENTION BECAUSE OF THE PRICE SHOWN WHICH WAS FAR BELOW THE MATERIAL'S ACTUAL COST TO THE COMPANY. IT WAS IMMEDIATELY APPARENT THAT HE HAD MADE AN ERROR IN CALCULATION WHICH HAD RESULTED IN THE SUBMISSION OF AN ERRONEOUS BID. THE ERROR IN BID WAS CONFIRMED BY LETTER DATED MARCH 19. AGAIN STATING THAT THROUGH A CALCULATING ERROR ON HIS PART HIS BID FOR THIS INVITATION WAS INCORRECT AT $1.

B-153822, APR. 3, 1964

TO PUBLIC PRINTER:

REFERENCE IS MADE TO YOUR LETTER OF MARCH 26, 1964, WITH ENCLOSURES, REQUESTING A DECISION AS TO THE ACTION TO BE TAKEN CONCERNING AN ERROR WHICH HOLLISTON MILLS, INC., NORWOOD, MASSACHUSETTS, ALLEGES IT MADE IN ITS BID WHICH WAS ACCEPTED MARCH 10, 1964.

IT IS REPORTED THAT ON FEBRUARY 27, 1964, THE GOVERNMENT PRINTING OFFICE ADVERTISED FOR PRICES ON 5,200 SHEETS OF WHITE PYROXYLIN IMPREGNATED FABRIC, SIZE 31 1/2 BY 43 1/2 INCHES, FOR SHIPMENT APRIL 3, 1964, F.O.B. GOVERNMENT PRINTING OFFICE. THE BIDS WERE OPENED ON MARCH 6, 1964, HOLLISTON MILLS SUBMITTING THE LOW BID OF $0.315, THE OTHER THREE BIDS RECEIVED RANGING IN PRICE FROM $0.51 TO $0.6675 PER SHEET. THE LOW BID WAS ACCEPTED AND GPO PURCHASE ORDER NO. 5789, DATED MARCH 11, 1964, WAS ISSUED AND FORWARDED TO HOLLISTON. ON MARCH 18, 1964, THE CONTRACTING OFFICER RECEIVED A TELEPHONE CALL FROM MR. C. A. JOHNSON OF HOLLISTON MILLS, INC., IN WHICH HE STATED THAT THE PURCHASE ORDER HAD BEEN BROUGHT TO HIS ATTENTION BECAUSE OF THE PRICE SHOWN WHICH WAS FAR BELOW THE MATERIAL'S ACTUAL COST TO THE COMPANY; THAT UPON REFERENCE TO QUOTATION NO. 590 DATED MARCH 3, 1964, AND HIS WORKSHEET, IT WAS IMMEDIATELY APPARENT THAT HE HAD MADE AN ERROR IN CALCULATION WHICH HAD RESULTED IN THE SUBMISSION OF AN ERRONEOUS BID; THAT IN VIEW OF THIS OBVIOUS ERROR HE REQUESTED THAT HIS COMPANY BE RELIEVED OF ITS OBLIGATION TO SUPPLY THE MATERIAL COVERED BY PURCHASE ORDER NO. 5789. THE ERROR IN BID WAS CONFIRMED BY LETTER DATED MARCH 19, 1964, FROM MR. JOHNSON, AGAIN STATING THAT THROUGH A CALCULATING ERROR ON HIS PART HIS BID FOR THIS INVITATION WAS INCORRECT AT $1,638 AND THAT THE CORRECT PRIDE SHOULD HAVE BEEN $3,255.20; THAT HIS ORIGINAL BID SHOULD HAVE READ 5,200 SHEETS AT $0.626 PER SHEET OR A TOTAL OF $3,255.20. THE REASON FOR THE MISCALCULATION WAS DUE TO THE FACT THAT HE ERRONEOUSLY FIGURED ON 2,320 YARDS OF 44-INCH CLOTH AS NECESSARY FOR SUPPLYING 5,200 SHEETS, SIZE 31 1/2 BY 43 1/2 INCHES, AND THAT THIS YARDAGE SHOULD HAVE BEEN 4,641 YARDS OF 44-INCH CLOTH TO SUPPLY THIS NUMBER OF SHEETS.

IT IS FURTHER REPORTED THAT THE CONTRACTING OFFICER HAS ADVISED THAT WHEN THE BIDS WERE EVALUATED HE FAILED TO NOTICE THE GREAT DIFFERENCE BETWEEN THE BID OF $0.315 PER SHEET OFFERED BY HOLLISTON MILLS, INC., AND THE CONSIDERABLY HIGHER PRICES QUOTED BY THE OTHER BIDDERS. HE HAS STATED, HOWEVER, THAT IT IS QUITE APPARENT THAT THE BIDDER MADE AN ERROR IN THE PREPARATION AND SUBMISSION OF HIS QUOTATION; THAT THE BIDDER'S EXPLANATION OF THE MANNER IN WHICH THE ERROR OCCURRED IS ENTIRELY CREDIBLE; THAT IT IS FURTHER SUBSTANTIATED BY THE MUCH HIGHER PRICE QUOTATIONS SUBMITTED BY THE OTHER BIDDERS, AND, IN ADDITION, YOUR OFFICE HAS FOUND FROM A FURTHER REVIEW OF PRICES PREVIOUSLY PAID FOR THIS MATERIAL THAT PRICES HAVE RANGED FROM $0.465 PER SHEET TO $0.545 PER SHEET OVER THE PAST TWO YEARS. THE CONTRACTING OFFICER HAS STATED FURTHER THAT HE SHOULD HAVE NOTED THE ERROR IN THE BID OF HOLLISTON MILLS, INC., PRIOR TO AWARDING A CONTRACT FOR THIS JOB; THAT THE BID IS OBVIOUSLY IN ERROR AS THE QUOTED PRICE OF $0.315 IS NOT CONSIDERED FAIR AND REASONABLE TO PAY FOR EACH SHEET OF THIS MATERIAL; THAT HAD IT NOT BEEN FOR THE EXTRA HEAVY WORKLOAD AT THE TIME BIDS WERE EVALUATED HE WOULD HAVE NOTED THE ERROR AND WOULD HAVE GIVEN HOLLISTON MILLS, INC., AN OPPORTUNITY TO REVIEW ITS BID PRICE BEFORE MAKING AN AWARD TO THEM. IT IS FURTHER STATED THAT GOVERNMENT ESTIMATES OF THE MATERIAL NEEDED TO PERFORM THE CONTRACT SHOW THAT THE FIGURE USED BY HOLLISTON MILLS, INC., IN CALCULATING ITS BID WOULD HAVE SUPPLIED APPROXIMATELY ONLY HALF THE QUANTITY REQUIRED BY THE GOVERNMENT.

ON THE BASIS OF THE FACTS AND THE EVIDENCE OF RECORD, THERE APPEARS TO BE NO DOUBT THAT AN ERROR WAS MADE BY THE CORPORATION, AS ALLEGED. UNDER THE CIRCUMSTANCES AND SINCE THE ERROR WAS ALLEGED PROMPTLY AND IT WOULD BE INEQUITABLE TO REQUIRE THE CORPORATION TO FURNISH THE SHEETS AT ITS ORIGINAL PRICE, THE PURCHASE ORDER MAY BE CANCELED WITHOUT LIABILITY TO THE CORPORATION.