B-156149, MAR. 8, 1965

B-156149: Mar 8, 1965

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GENERAL SERVICES ADMINISTRATION: REFERENCE IS MADE TO YOUR LETTER OF FEBRUARY 15. REQUESTING A DECISION AS TO THE ACTION TO BE TAKEN WITH REGARD TO A MISTAKE IN BID ALLEGED TO HAVE BEEN MADE BY CONCORD CHEMICAL COMPANY. SFN-23661-64 AND WHICH WAS NOT DISCOVERED UNTIL AFTER AWARD OF CONTRACT NO. THE CONCORD CHEMICAL COMPANY WAS THE LOW BIDDER ON ITEMS 25. CONCORD WAS AWARDED THE CONTRACT ON JULY 7. CONCORD ADVISED THE CONTRACTING OFFICER BY LETTER THAT THERE WAS AN ERROR IN ITS BID PRICE IN THAT IT HAD MISTAKENLY CONCLUDED THAT THE CONTRACT REQUIREMENTS WERE IDENTICAL TO THOSE OF AN EARLIER INVITATION FOR BIDS ISSUED APRIL 17. CONCORD HAS SUBMITTED ITS WORKSHEETS FOR THE 1963 BID HAVING NO SILICONE AND THE 1964 BREAKDOWN IF SILICONE WAS ADDED.

B-156149, MAR. 8, 1965

TO THE HONORABLE LAWSON B. KNOTT, JR., ACTING ADMINISTRATOR, GENERAL SERVICES ADMINISTRATION:

REFERENCE IS MADE TO YOUR LETTER OF FEBRUARY 15, 1965, REQUESTING A DECISION AS TO THE ACTION TO BE TAKEN WITH REGARD TO A MISTAKE IN BID ALLEGED TO HAVE BEEN MADE BY CONCORD CHEMICAL COMPANY, INC., IN SUBMISSION OF ITS BID UNDER INVITATION FOR BIDS NO. SFN-23661-64 AND WHICH WAS NOT DISCOVERED UNTIL AFTER AWARD OF CONTRACT NO. TC-GS-09S 13263.

THE CONCORD CHEMICAL COMPANY WAS THE LOW BIDDER ON ITEMS 25, 26 AND 27 OF THE CITED INVITATION FOR BIDS. THE ITEMS CALLED FOR DELIVERY OF ESTIMATED QUANTITIES OF AUTOMOBILE WAX, F.O.B. VARIOUS DESTINATIONS, DURING THE PERIOD FROM DATE OF AWARD TO JUNE 30, 1965. CONCORD WAS AWARDED THE CONTRACT ON JULY 7, 1964, FOR $0.394 PER 1-POUND CAN. ON JULY 24, 1964, CONCORD ADVISED THE CONTRACTING OFFICER BY LETTER THAT THERE WAS AN ERROR IN ITS BID PRICE IN THAT IT HAD MISTAKENLY CONCLUDED THAT THE CONTRACT REQUIREMENTS WERE IDENTICAL TO THOSE OF AN EARLIER INVITATION FOR BIDS ISSUED APRIL 17, 1963. ACCORDINGLY IT HAD INSTRUCTED ITS TYPIST TO USE THE SAME PRICES ON THE INSTANT BID. AFTER IT RECEIVED THE CONTRACT IT NOTICED THAT THE FEDERAL SPECIFICATION NUMBERED P-W-120A MADE A PART OF THE INVITATION CALLED FOR THE INCLUSION OF SILICONE IN THE PASTE WAX. THE PRIOR INVITATION FOR THESE ITEMS CARRIED THE SAME STOCK NUMBER BUT THE SPECIFICATIONS IN THAT CASE DID NOT REQUIRE THE INCLUSION OF THE INGREDIENT SILICONE. CONCORD HAS SUBMITTED ITS WORKSHEETS FOR THE 1963 BID HAVING NO SILICONE AND THE 1964 BREAKDOWN IF SILICONE WAS ADDED. WITHOUT SILICONE ITS BID IS $0.394 PER 1-POUND CAN. WITH SILICONE AS SPECIFIED THE BID WOULD ALLEGEDLY HAVE BEEN $0.553 PER CAN. BECAUSE OF THE DISPARITY BETWEEN THE ADDED COST AND THE ACTUAL BID CONCORD ASKS TO BE RELIEVED FROM PERFORMING THE CONTRACT.

THE CONTRACTING OFFICER HAS DETERMINED THAT THE ALLEGED MISTAKE IS WELL SUPPORTED AND HE FINDS BY COMPARING THE FOUR BIDS RECEIVED, NAMELY, $0.394, $0.48, $0.521 AND $0.67 PER POUND CAN, THAT CONCORD'S BID WAS SO LOW AS TO HAVE PUT HIM ON CONSTRUCTIVE NOTICE THAT AN APPARENT ERROR HAD BEEN MADE. THEREFORE, CONCORD SHOULD HAVE BEEN ASKED FOR VERIFICATION OF ITS BID BEFORE AWARD.

OUR OFFICE HAS HELD THAT WHERE A BIDDER HAS MADE A MISTAKE IN ITS BID AND BECAUSE OF THE ACCOMPANYING CIRCUMSTANCES THE GOVERNMENT HAD REASON TO BELIEVE A MISTAKE WAS MADE BUT NEVERTHELESS ACCEPTED THE BID, THE BIDDER HAS THE RIGHT TO RESCISSION AND RESTITUTION. SEE B 155794, JANUARY 6, 1965, AND COURT CASES THERE CITED.

ACCORDINGLY, IF CONCORD IS WILLING TO ACCEPT PAYMENT AT THE PRICE OFFERED BY THE NEXT RESPONSIVE LOW BIDDER, WE WOULD HAVE NO OBJECTION IN THIS CASE TO THE REFORMATION OF THE CONTRACT BY INCREASING THE UNIT PRICE FROM $0.394 TO $0.48.