B-159619, AUG. 2, 1966

B-159619, AUG. 2, 1966

TO ADMINISTRATOR, VETERANS ADMINISTRATION:

REFERENCE IS MADE TO LETTER DATED JULY 5, 1966, FILE 074B, FROM THE DIRECTOR, SUPPLY MANAGEMENT SERVICE, OFFICE OF MANAGEMENT AND EVALUATION, FORWARDING FOR OUR DETERMINATION THE QUESTION AS TO WHETHER THE CONTRACT AWARDED TO MURREY AND SONS COMPANY, UNDER INVITATION NO. 66-33, MAY BE CANCELLED ON THE GROUNDS OF MISTAKE ALLEGED BY THE CONTRACTOR AFTER AWARD.

THE INVITATION WAS ISSUED ON FEBRUARY 28, 1966, AND SOLICITED BIDS FOR FURNISHING AND INSTALLING ONE SET OF BOWLING ALLEYS, FURNISHING OF AUTOMATIC PINSETTERS AND OTHER ACCESSORIAL EQUIPMENT AND REMOVAL OF TWO COMPLETE BOWLING ALLEYS. THREE BIDS WERE RECEIVED AS FOLLOWS:

TABLE

MURREY AND SONS COMPANY $15,418.82

AMERICAN MACHINE AND FOUNDRY 15,975.00

BRUNSWICK CORPORATION 17,475.21

THE LOW BIDDER OFFERED A TWO PERCENT 30-DAY DISCOUNT AND $250 FOR TRADE- IN OF TWO ALLEYS. THE SECOND LOW BIDDER ALSO OFFERED A TWO PERCENT 30-DAY DISCOUNT BUT DID NOT BID ON THE TRADE-IN.THE HIGHEST BID WAS NET AND OFFERED $1,070 FOR TRADE-IN OF THE OLD ALLEYS. AFTER RECEIPT OF PURCHASE ORDER 1567, ISSUED ON APRIL 18, 1966, IN THE AMOUNT OF $15,168.82, THE CONTRACTOR TELEPHONED THE CONTRACTING OFFICER ON APRIL 27 TO ADVISE THAT ITS SUPPLIER, BOWL-MOR COMPANY, HAD INCREASED THE PRICE ON THE TWO PINSETTING MACHINES BECAUSE OF AN ERROR IN ITS ORIGINAL QUOTATION. THE ERROR BY THE SUPPLIER WAS STATED TO HAVE BEEN CAUSED BY ITS SECRETARY IN PRICING ON MARCH 16, 1966. THE ERROR WAS ON ITEM NO. 1-2 COUGAR AUTOMATIC PINSETTERS, FOR WHICH THE PRICE QUOTED WAS $6,602.50, WHICH ALLEGEDLY SHOULD HAVE BEEN $13,205. THE CONTRACTOR STATED THAT IT BASED ITS PRICE FOR AUTOMATIC PINSETTERS ON ITS SUPPLIER'S QUOTATION OF MARCH 16, 1966, AND ADDED THE PRICE OF THE LANES AS PER BID. THE EVIDENCE SUBMITTED SUBSTANTIATES THAT THE ERROR WAS MADE AS ALLEGED.

THE PRIMARY QUESTION FOR CONSIDERATION IS NOT WHETHER AN ERROR WAS MADE IN THE BID BUT WHETHER A VALID AND BINDING CONTRACT WAS CONSUMMATED BY ITS ACCEPTANCE.

IN CASES WHERE A MISTAKE HAS BEEN ALLEGED AFTER AWARD OF THE CONTRACT, THIS OFFICE WILL GRANT RELIEF ONLY IF THE MISTAKE WAS MUTUAL OR THE CONTRACTING OFFICER WAS, OR SHOULD HAVE BEEN, ON CONSTRUCTIVE NOTICE OF THE ERROR PRIOR TO AWARD. THERE WAS NOTHING ON THE FACE OF THE BID OF THE COMPANY TO INDICATE THAT THE PRICE OF $15,418.82, LESS TRADE-IN ALLOWANCE OF $250, WAS NOT AS INTENDED. THE PRICE WAS FOR "1 SET" WITH NO BREAKDOWN OF PRICING FOR COMPONENTS, ALTHOUGH THE SPECIFICATIONS CLEARLY DETAILED THE KIND AND NUMBER OF COMPONENTS. THE CONTRACTING OFFICER HAS REPORTED THAT HE HAD NO REASON TO SUSPECT AN ERROR IN THE BID, THE TWO OTHER BIDS RANGING CLOSELY IN AMOUNT WITH THAT OF THE MURREY COMPANY. IN VIEW OF THE CLOSE COMPETITIVE RANGE OF THE BIDS, WE CANNOT CONCLUDE THAT THE CONTRACTING OFFICER SHOULD HAVE BEEN ON NOTICE OF THE PROBABILITY OF ERROR IN THE MURREY COMPANY BID. SO FAR AS THE PRESENT RECORD SHOWS, THE ACCEPTANCE OF THE BID WAS MADE IN GOOD FAITH, NO ERROR HAVING BEEN ALLEGED UNTIL AFTER AWARD. THE ACCEPTANCE OF THE BID, UNDER THE CIRCUMSTANCES INVOLVED, CONSUMMATED A VALID AND BINDING CONTRACT WHICH FIXED THE RIGHTS OF THE PARTIES THERETO. SEE OGDEN AND DOUGHERTY V. UNITED STATES, 102 CT.CL. 245; SALIGMAN, ET AL. V. UNITED STATES, 56 F.SUPP. 505.

MOREOVER, THE RESPONSIBILITY FOR THE PREPARATION OF THE BID SUBMITTED IN RESPONSE TO THE INVITATION WAS UPON THE CONTRACTOR. SEE FRAZIER-DAVIS CONSTRUCTION COMPANY V. UNITED STATES, 100 CT.CL. 120, 163. WHILE IT MAY BE THAT AN ERROR WAS MADE IN THE BID, IT IS CLEAR THAT SUCH ERROR WAS DUE SOLELY BY THE CONTRACTOR'S NEGLIGENCE OR OVERSIGHT AND WAS NOT IN ANY WAY INDUCED OR CONTRIBUTED TO BY THE GOVERNMENT. ANY ERROR THAT WAS MADE WAS UNILATERAL--- NOT MUTUAL--- AND THEREFORE DOES NOT ENTITLE THE CONTRACTOR TO RELIEF. SEE 20 COMP. GEN. 652 AND 26 ID. 405.

ACCORDINGLY, THERE IS NO LEGAL BASIS FOR CANCELLATION OF THE CONTRACT AS REQUESTED BY THE CONTRACTOR AND ENFORCEMENT THEREOF SHOULD BE MADE IN ACCORDANCE WITH ITS TERMS.