B-155529, NOV. 30, 1964

B-155529, NOV. 30, 1964

TO THE HONORABLE SECRETARY OF COMMERCE:

REFERENCE IS MADE TO LETTER OF OCTOBER 29, 1964, FROM THE ACTING MARITIME ADMINISTRATOR, WITH ENCLOSURES, REQUESTING OUR CONCURRENCE IN THE MARITIME ADMINISTRATION PROPOSAL TO GRANT THE REQUEST OF NORFOLK SHIPBUILDING AND DRYDOCK CORPORATION OF NORFOLK, VIRGINIA, FOR CORRECTION OF ITS BID BY AN UPWARD ADJUSTMENT THEREOF.

IT IS STATED THAT UNDER INVITATION FOR BIDS DATED JULY 31, 1964, AS AMENDED, ISSUED BY THE MARITIME ADMINISTRATION FOR THE CONSTRUCTION OF TWO HYDROGRAPHIC SURVEY SHIPS, MA DESIGN S1-ST-MA70A, FOR THE USE OF THE COAST AND GEODETIC SURVEY UNDER THE ECONOMY ACT OF 1932, BIDS WERE RECEIVED AND OPENED ON OCTOBER 14, 1964. THE APPARENT LOW BID, SUBMITTED BY NORFOLK SHIPBUILDING, WAS IN ALL RESPECTS RESPONSIVE TO THE INVITATION, AND WAS IN THE AMOUNT OF $2,564,783 FOR THE FIRST SHIP, AND IN THE AMOUNT OF $2,302,541 FOR EACH OF TWO SHIPS.

THE BID OF THE ONLY OTHER BIDDER WAS SUBSTANTIALLY HIGHER NOT ONLY FOR ONE SHIP BUT FOR EACH OF TWO SHIPS AS WELL.

BY TELEGRAM DATED OCTOBER 15, 1964, IN RESPONSE TO A TELEGRAPHIC REQUEST FROM THE MARITIME ADMINISTRATION FOR DETAILED COST INFORMATION, NORFOLK SHIPBUILDING STATED THAT IN THE ACT OF COMPLYING WITH THE MARITIME ADMINISTRATION REQUEST REGARDING ITS BID, IT HAD FOUND AN ERROR IN ITS BID. ON OCTOBER 19, 1964, A REPRESENTATIVE OF NORFOLK SHIPBUILDING, IN A MEETING HELD IN THE MARITIME ADMINISTRATION OFFICES, STATED THAT A CLERICAL ERROR HAD BEEN MADE IN THE PREPARATION OF HIS COMPANY'S BID. LETTER OF OCTOBER 19, 1964, NORFOLK SHIPBUILDING REQUESTED THAT ITS BID BE CORRECTED, BECAUSE OF A CLERICAL ERROR MADE IN TRANSPOSING THE FINAL FIGURES FROM A WORKSHEET TO THE BID-FORM, TO READ AS FOLLOWS: FOR THE FIRST SHIP--- $2,564,783; FOR EACH OF TWO SHIPS--- $2,433,662.

BY LETTER DATED OCTOBER 20, 1964, NORFOLK SHIPBUILDING SUBMITTED TO THE CHIEF, OFFICE OF SHIP CONSTRUCTION, MARITIME ADMINISTRATION, AFFIDAVITS FROM PERSONNEL OF NORFOLK SHIPBUILDING IN SUPPORT OF ITS REQUEST FOR BID CORRECTION. ON THE BASIS OF THE AFFIDAVITS AND SUPPORTING DOCUMENTS, THE MARITIME ADMINISTRATION PROPOSES TO GRANT THE REQUEST OF NORFOLK SHIPBUILDING FOR CORRECTION OF ITS BID BY AN UPWARD ADJUSTMENT. IT IS FURTHER STATED THAT THE CORRECTED BID WOULD STILL BE THE LOW BID FOR THE CONSTRUCTION OF TWO SHIPS.

THE AFFIDAVITS WITH SUPPORTING WORK PAPERS SUBMITTED BY NORFOLK SHIPBUILDING CLEARLY EVIDENCE AN INTENT TO BID $2,564,783 FOR THE FIRST SHIP AND $2,302,541 FOR THE SECOND SHIP, OR A TOTAL OF $4,867,324 FOR TWO SHIPS; THAT THE BID-FORM WAS MISREAD AND THE PRICE OF THE SECOND SHIP AS SHOWN ON THE WORKSHEET WAS ERRONEOUSLY INSERTED AS THE BID PRICE FOR EACH OF TWO SHIPS INSTEAD OF THERE BEING INSERTED AS THE BID PRICE FOR EACH OF TWO SHIPS ONE-HALF OF THE COMBINED PRICE OF THE FIRST AND SECOND SHIPS.

OUR OFFICE HAS TAKEN THE POSITION THAT, TO JUSTIFY CORRECTION OFA BID, THE BIDDER MUST ESTABLISH BY CLEAR AND CONVINCING EVIDENCE THE MANNER IN WHICH THE MISTAKE OCCURRED AND THE PRICE WHICH WAS INTENDED AND WOULD HAVE BEEN SUBMITTED IN THE ABSENCE OF ERROR. SEE, 35 COMP. GEN. 279.

IN VIEW OF THE FACTS OF THE MATTER, IT MAY BE REGARDED AS SATISFACTORILY ESTABLISHED THAT NORFOLK SHIPBUILDING MADE A BONA FIDE ERROR IN ITS BID. ACCORDINGLY, SINCE THE ERROR WAS ALLEGED AND EXPLAINED AND THE INTENDED BID PRICE FULLY ESTABLISHED PRIOR TO AWARD, WE CONCUR IN THE PROPOSAL OF THE MARITIME ADMINISTRATION TO PERMIT CORRECTION OF THE BID TO THE AMOUNT OF $2,433,662 FOR EACH OF TWO SHIPS.