B-159984, SEP. 16, 1966

B-159984: Sep 16, 1966

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TO THE SECRETARY OF THE AIR FORCE: REFERENCE IS MADE TO A LETTER DATED AUGUST 18. AF 34/601/20498 BE CANCELED ON ACCOUNT OF AN ERROR ALLEGED TO HAVE BEEN MADE IN ITS BID ON WHICH THE CONTRACT IS BASED. THE BID OF THE CORPORATION WAS ACCEPTED AS TO ITEM 2 AND OTHER ITEMS ON OR ABOUT NOVEMBER 30. PETE GRANEK OF G AND G REQUESTED THAT THE CORPORATION BE PERMITTED TO WITHDRAW ITS BID ON ITEM 2 ON THE GROUND THAT THE MATERIAL TENDERED TO IT AFTER AWARD AS ITEM 2 WAS NOT THE SAME MATERIAL WHICH WAS INSPECTED PRIOR TO THE SUBMISSION OF THE BID AND UPON WHICH ITS PRICE WAS BASED. ACTUALLY WERE TWO ITEMS. GRANEK HAS ALSO STATED THAT AT THE TIME OF INSPECTION HE ASKED TO SEE ITEM 8 AND WAS TOLD BY SOUTHWEST'S REPRESENTATIVE THAT IT COULD NOT BE LOCATED.

B-159984, SEP. 16, 1966

TO THE SECRETARY OF THE AIR FORCE:

REFERENCE IS MADE TO A LETTER DATED AUGUST 18, 1966, FILE REFERENCE AJF, FROM TRANSPORTATION LOSS AND DAMAGE DIVISION, DIRECTORATE OF ADJUDICATION, HEADQUARTERS AIR FORCE ACCOUNTING AND FINANCE CENTER, DENVER, COLORADO, FORWARDING THE REQUEST OF G AND G STEEL, INC., TUCSON, ARIZONA, THAT ITEM 2 (REFERENCE NO. H-89) OF SALES CONTRACT NO. AF 34/601/20498 BE CANCELED ON ACCOUNT OF AN ERROR ALLEGED TO HAVE BEEN MADE IN ITS BID ON WHICH THE CONTRACT IS BASED.

IN RESPONSE TO SCRAP SALE INVITATION DCASR S4403A151, ISSUED BY SOUTHWEST AIR MOTIVE COMPANY, DALLAS, TEXAS, ON NOVEMBER 5, 1965, AS AGENT FOR THE GOVERNMENT, G AND G SUBMITTED A BID OFFERING TO PURCHASE, AMONG OTHER ITEMS, SCRAP METAL DESCRIBED IN ITEM 2 AT A PRICE OF $0.13999 PER POUND. THE BID OF THE CORPORATION WAS ACCEPTED AS TO ITEM 2 AND OTHER ITEMS ON OR ABOUT NOVEMBER 30, 1965.

BY LETTER DATED DECEMBER 13, 1965, MR. PETE GRANEK OF G AND G REQUESTED THAT THE CORPORATION BE PERMITTED TO WITHDRAW ITS BID ON ITEM 2 ON THE GROUND THAT THE MATERIAL TENDERED TO IT AFTER AWARD AS ITEM 2 WAS NOT THE SAME MATERIAL WHICH WAS INSPECTED PRIOR TO THE SUBMISSION OF THE BID AND UPON WHICH ITS PRICE WAS BASED. IN A LETTER DATED JANUARY 20, 1966, MR. GRANEK STATED THAT AT THE TIME OF THE INSPECTION OF THE MATERIAL, A REPRESENTATIVE OF SOUTHWEST SHOWED HIM TWO PILES OF SCRAP MATERIAL AND TOLD HIM THAT ITEM 2 CONSISTED OF THOSE TWO PILES OF SCRAP MATERIAL. MR. GRANEK STATED FURTHER THAT WHEN HE CAME TO PICK UP THE MATERIAL HE DISCOVERED THAT THE TWO PILES OF MATERIAL, WHICH HE HAD BEEN SHOWN PRIOR TO THE SUBMISSION OF THE BID, ACTUALLY WERE TWO ITEMS, ITEM 2 AND ITEM 8, INSTEAD OF ONLY ITEM 2 AS HE HAD BEEN TOLD BY SOUTHWEST'S REPRESENTATIVE. MR. GRANEK HAS ALSO STATED THAT AT THE TIME OF INSPECTION HE ASKED TO SEE ITEM 8 AND WAS TOLD BY SOUTHWEST'S REPRESENTATIVE THAT IT COULD NOT BE LOCATED. HE SAID THAT, AS A RESULT, THE CORPORATION DID NOT SUBMIT A BID ON ITEM 8.

ITEM 2 IS COMPOSED OF THREE DIFFERENT ALLOY GROUPS WHEREAS ITEM 8 CONSISTS OF ONLY ONE ALLOY GROUP. THE ABSTRACT OF BIDS SHOWS THAT, IN ADDITION TO THE BID FROM G AND G, THREE OTHER BIDS WERE RECEIVED ON ITEM 2 IN THE AMOUNTS OF $0.0611, $0.0475 AND $0.0403 PER POUND. THE ABSTRACT OF BIDS ALSO SHOWS THAT THREE BIDS RANGING FROM $0.1026 PER POUND TO $0.1236 PER POUND WERE RECEIVED ON ITEM 8.

IT IS REPORTED THAT PERSONNEL OF SOUTHWEST FAMILIAR WITH THE SALE MATERIAL WERE ABSENT ON THE DAY MR. GRANEK MADE HIS INSPECTION AND THAT AN EMPLOYEE NOT FAMILIAR WITH THE SALE MATERIAL ESCORTED MR. GRANEK AROUND THE SALE SITE. A RESPONSIBLE OFFICIAL OF SOUTHWEST HAS STATED THAT THE EMPLOYEE WHO ESCORTED MR. GRANEK ON THE INSPECTION TOUR ADMITTED HE INFORMED HIM AT THAT TIME THAT ALL OF THE MATERIAL IN QUESTION WAS UNDER ITEM 2, ALTHOUGH LATER REFUSING TO PUT THE STATEMENT IN WRITING ON GROUNDS THAT HE DID NOT REMEMBER WHAT HE TOLD HIM. FURTHER THE OFFICIAL HAS EXPRESSED THE OPINION THAT IT WAS THE COMPANY'S FAULT IN NOT HAVING SOMEONE THERE TO SHOW THE MATERIAL WHO WAS FAMILIAR WITH IT. ALSO, THE FACT THAT THE PRICE QUOTED BY G AND G FOR ITEM 2 IS IN LINE WITH THE PRICE QUOTED BY OTHER BIDDERS FOR ITEM 8 TENDS TO CONFIRM MR. GRANEK'S STATEMENT THAT AT THE TIME OF INSPECTION HE WAS SHOWN THE MATERIAL IN ITEM 8 AS A PART OF ITEM 2.

THUS, THE RECORD INDICATES THAT THE PROPERTY OFFERED FOR DELIVERY UNDER ITEM 2 OF THE CONTRACT WAS NOT THAT WHICH MR. GRANEK INSPECTED PRIOR TO THE SUBMISSION OF THE CORPORATION'S BID AND UPON WHICH ITS BID PRICE FOR ITEM 2 WAS BASED. MOREOVER, IT APPEARS THAT G AND G WAS DILIGENT IN THAT IT UNDERTOOK AN INSPECTION AND WAS LED INTO THE PRESENT PREDICAMENT BY A REPRESENTATIVE OF AN AGENT OF THE GOVERNMENT AND NOT THROUGH ANY FAULT OF ITS OWN. IN THE CIRCUMSTANCES, OUR OFFICE CONCURS IN THE ADMINISTRATIVE RECOMMENDATION THAT ITEM 2 (REFERENCE NO. H-89) OF CONTRACT NO. AF 34/601/20498 SHOULD BE CANCELED WITHOUT LIABILITY TO G AND G STEEL, INC.