B-157302, AUG. 6, 1965

B-157302: Aug 6, 1965

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TO THE POSTMASTER GENERAL: REFERENCE IS MADE TO A LETTER DATED JULY 20. TO HAVE BEEN MADE IN ITS BID ON WHICH CONTRACT NO. 5-1-02675 IS BASED. THE BID OF THE COMPANY WAS ACCEPTED ON JUNE 29. THE CONRAD COMPANY ADVISED THAT AN ERROR HAD BEEN MADE IN ITS BID IN THAT ITS BID PRICE ON THE LABELS WAS BASED ON AN ERRONEOUS QUOTATION OF ITS SUPPLIER. IT LEARNED FROM ITS SUPPLIER THAT THE CORRECT PRICE OF THE PAPER WAS $9.55 PER HUNDRED SHEETS AND NOT $9.55 PER THOUSAND SHEETS. AS $125 AND THAT THE CORRECT COST OF THE PAPER IS $1. THE COMPANY POINTED OUT THAT THE AMOUNT OF THE ERROR IS MORE THAN THE AMOUNT OF ITS BID PRICE OF $1. IN WHICH IT WAS STATED THAT THE ERROR BETWEEN THE CONRAD COMPANY AND THE SUPPLIER OCCURRED BECAUSE OF A TENDENCY IN THE PAPER TRADE TO QUOTE IN TERMS OF PER THOUSAND SHEETSON LOWER PRICED PAPERS AND THAT STORMTITE.

B-157302, AUG. 6, 1965

TO THE POSTMASTER GENERAL:

REFERENCE IS MADE TO A LETTER DATED JULY 20, 1965, WITH ENCLOSURES, FROM THE ACTING DIRECTOR, BUREAU OF FACILITIES, REQUESTING A DECISION AS TO THE ACTION TO BE TAKEN CONCERNING AN ERROR ALLEGED BY THE CONRAD COMPANY, PHILADELPHIA, PENNSYLVANIA, TO HAVE BEEN MADE IN ITS BID ON WHICH CONTRACT NO. 5-1-02675 IS BASED.

THE BUREAU OF FACILITIES, WASHINGTON, D.C., BY INVITATION NO. 393, REQUESTED BIDS FOR FURNISHING 4,500 PADS OF WHITE PRESSURE SENSITIVE LABELS, SIZE 4-1/4 INCHES BY 1-5/6 INCHES, FOR DELIVERY TO VARIOUS AREA SUPPLY CENTERS. IN RESPONSE THE CONRAD COMPANY SUBMITTED A BID OFFERING TO FURNISH THE LABELS AT A UNIT PRICE OF $0.23 PER PAD OR FOR A TOTAL PRICE OF $1,035. THE BID OF THE COMPANY WAS ACCEPTED ON JUNE 29, 1965.

BY LETTER DATED JULY 7, 1965, THE CONRAD COMPANY ADVISED THAT AN ERROR HAD BEEN MADE IN ITS BID IN THAT ITS BID PRICE ON THE LABELS WAS BASED ON AN ERRONEOUS QUOTATION OF ITS SUPPLIER. THE COMPANY STATED THAT UPON ORDERING THE PRESSURE SENSITIVE PAPER REQUIRED FOR THE LABELS, IT LEARNED FROM ITS SUPPLIER THAT THE CORRECT PRICE OF THE PAPER WAS $9.55 PER HUNDRED SHEETS AND NOT $9.55 PER THOUSAND SHEETS, AS ORIGINALLY QUOTED.

IN A LETTER DATED JULY 15, 1965, IN WHICH IT REQUESTED THAT THE CONTRACT BE CANCELED, THE COMPANY STATED THAT IT HAD ORIGINALLY ESTIMATED THE COST OF THE REQUIRED PRESSURE SENSITIVE PAPER, 13,000 SHEETS, AS $125 AND THAT THE CORRECT COST OF THE PAPER IS $1,250 OR A DIFFERENCE OF $1,150. THE COMPANY POINTED OUT THAT THE AMOUNT OF THE ERROR IS MORE THAN THE AMOUNT OF ITS BID PRICE OF $1,035. IN SUPPORT OF ITS ALLEGATION OF ERROR, THE COMPANY SUBMITTED ITS WORKSHEET AND ITS SUPPLIER'S CATALOG WHICH LISTS THE PRICES OF VARIOUS MATERIALS. THE COMPANY ALSO SUBMITTED A COPY OF A LETTER DATED JULY 14, 1965, RECEIVED FROM BENJ. E. KRIEGER, INC., ITS SUPPLIER, IN WHICH IT WAS STATED THAT THE ERROR BETWEEN THE CONRAD COMPANY AND THE SUPPLIER OCCURRED BECAUSE OF A TENDENCY IN THE PAPER TRADE TO QUOTE IN TERMS OF PER THOUSAND SHEETSON LOWER PRICED PAPERS AND THAT STORMTITE, THE BRAND NAME OF THE PAPER REQUIRED FOR THE LABELS, IS NOT A LOW-PRICED PAPER. THE SUPPLIER'S CATALOG SHOWS A PRICE OF $9.55 PER 100 SHEETS FOR STORMTITE ON ORDERS OF 5,000 SHEETS.

THE ABSTRACT OF BIDS SHOWS THAT 5 OF THE 14 OTHER BIDDERS QUOTED UNIT PRICES RANGING FROM $0.32 PER PAD TO $0.371 PER PAD. CONSIDERING THE FACT THAT THERE IS ONLY A RANGE OF $0.051 IN THIS GROUP OF BIDS AND THE FACT THAT THERE IS A DIFFERENCE OF $0.09 BETWEEN THE UNIT PRICE QUOTED BY THE CONRAD COMPANY AND THE SECOND LOWEST BIDDER, WE ARE OF THE OPINION THAT THE CONTRACTING OFFICER SHOULD HAVE BEEN PLACED ON NOTICE OF AN ERROR IN THE BID OF THE COMPANY AND CONSEQUENTLY, THE BID SHOULD NOT HAVE BEEN ACCEPTED WITHOUT REQUESTING VERIFICATION THEREOF.

THE RECORD SHOWS THAT ERROR WAS ALLEGED BY THE COMPANY ALMOST SIMULTANEOUSLY WITH THE ACCEPTANCE OF ITS BID, AND APPARENTLY BEFORE IT BECAME AWARE OF THE ACCEPTANCE OF ITS BID. ACCORDINGLY, AND SINCE THE RECORD REASONABLY ESTABLISHES THAT AN ERROR WAS MADE BY THE CONRAD COMPANY, THE CONTRACT MAY BE CANCELED AS RECOMMENDED BY THE CONTRACTING OFFICER AND THE ACTING DIRECTOR, BUREAU OF FACILITIES.