B-163953, MAY 6, 1968

B-163953: May 6, 1968

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SECRETARY: REFERENCE IS MADE TO LETTER DATED APRIL 3. THE CONTRACTOR WAS THE LOW BIDDER ON A NATIONAL PARK SERVICE CONSTRUCTION PROJECT INVOLVING ROADS. THE GOVERNMENT ENGINEER'S ESTIMATE FOR ITEMS NOS. 54 AND 55 COMBINED WAS $7. ALL BID PRICES FOR ITEM NO. 55 WERE COMPARATIVELY MINOR. SCHEDULES II AND III WERE ELIMINATED FROM THE CONTRACT. THE WORK WAS BEGUN IN EARLY AUGUST 1967 AND SOON AFTER ISSUANCE OF THE NOTICE TO PROCEED. MACQUINN'S SUBCONTRACTORS WERE REQUESTED TO OBTAIN MATERIALS FOR THE PROJECT. THIS FIGURE WAS THEN CARRIED FORWARD AND INCLUDED IN THE ADDITION OF THE MATERIALS AND LABOR ESTIMATES. 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.

B-163953, MAY 6, 1968

TO MR. SECRETARY:

REFERENCE IS MADE TO LETTER DATED APRIL 3, 1968, WITH ENCLOSURES, FROM THE DEPUTY ASSISTANT SECRETARY FOR ADMINISTRATION, FORWARDING FOR OUR DECISION THE REQUEST OF HAROLD MACQUINN, INC., BAR HARBOR, MAINE, FOR RELIEF FROM A MISTAKE IN BID ALLEGED AFTER AWARD OF A CONTRACT.

THE CONTRACTOR WAS THE LOW BIDDER ON A NATIONAL PARK SERVICE CONSTRUCTION PROJECT INVOLVING ROADS, PARKING AREAS, WALKS AND UTILITIES AT HULLS COVE AND CADILLAC MOUNTAIN IN ACADIA NATIONAL PARK, MAINE. THE INVITATION SET FORTH SEVEN SCHEDULES WITH A TOTAL OF 55 ITEMS. ITEM NO. 54 OF SCHEDULE VII REQUESTED A LUMP-SUM BID FOR "ELECTRICAL SERVICE SYSTEM, INCLUDING TRENCH SPACE FOR TELEPHONE CABLE.' THE WORK CONSISTS OF FURNISHING ALL MATERIAL AND PERFORMING ALL OPERATIONS TO INSTALL THE COMPLETE 120/208 VOLT, 3 PHASE, 4 WIRE ELECTRIC SERVICE ENTRANCE SYSTEM, WITH TRENCH SPACE FOR A TELEPHONE CABLE FROM THE POWER COMPANY'S POLE-MOUNTED TRANSFORMERS NEAR STATE ROUTE 3 TO A POINT 25 FEET OUTSIDE THE FUTURE HEADQUARTERS BUILDING, INCLUDING 75 FEET OF EXTRA LENGTH ON EACH ELECTRIC CABLE FOR FUTURE EXTENSION INTO THE BUILDING AND ALL MISCELLANEOUS ITEMS ON WORK REQUIRED FOR THE COMPLETE SYSTEM.

MACQUINN OFFERED A LUMP-SUM BID OF $5,500 FOR ITEM NO. 54. THE OTHER TWO BIDDERS ON THE PROJECT QUOTED LUMP-SUM PRICES OF $5,750 AND $5,800, RESPECTIVELY, FOR THAT ITEM. THE GOVERNMENT ENGINEER'S ESTIMATE FOR ITEMS NOS. 54 AND 55 COMBINED WAS $7,000. ALL BID PRICES FOR ITEM NO. 55 WERE COMPARATIVELY MINOR, RANGING FROM $175 TO $210. THE LOW OVERALL BID OF MACQUINN ON SCHEDULES I, IV THROUGH VII RESULTED IN THE AWARD TO IT OF CONTRACT NO. 14-10-5-123-2 DATED MAY 26, 1967, IN THE AMOUNT OF $136,595.25. FOR BUDGETARY REASONS, SCHEDULES II AND III WERE ELIMINATED FROM THE CONTRACT.

THE WORK WAS BEGUN IN EARLY AUGUST 1967 AND SOON AFTER ISSUANCE OF THE NOTICE TO PROCEED, MACQUINN'S SUBCONTRACTORS WERE REQUESTED TO OBTAIN MATERIALS FOR THE PROJECT. IN LATE AUGUST 1967, ONE FRED ROGERS, REPRESENTING THE HARADEN ELECTRIC COMPANY, A SUBCONTRACTOR, INFORMED THE SUPERINTENDENT AT ACADIA NATIONAL PARK THAT A SERIOUS ERROR HAD BEEN MADE IN PREPARING A PRICE QUOTATION FOR MACQUINN FOR ITEM NO. 54. HE ADVISED THAT IN CALCULATING THE COST OF COPPER CONDUCTOR A DECIMAL POINT HAD BEEN MISPLACED RESULTING IN A FIGURE OF $900 BEING USED INSTEAD OF $9,000. THE SUBCONTRACTOR'S LONGHAND ESTIMATE SHEET, DULY CERTIFIED AS THE ORIGINAL, SHOWS THAT THE DECIMAL ERRONEOUSLY POINTED OUT AN ADDITIONAL PLACE TO THE LEFT WHEN MULTIPLYING THE ESTIMATED LENGTH OF WIRE REQUIRED BY THE ESTIMATED COST PER FOOT. THIS FIGURE WAS THEN CARRIED FORWARD AND INCLUDED IN THE ADDITION OF THE MATERIALS AND LABOR ESTIMATES. THE CONTRACTOR INCLUDED THE TOTAL WHEN PREPARING ITS BID ON ITEM NO. 54 AND IT NOW ASKS FOR AN INCREASE IN PRICE OF $8,100 WHICH, IF ALLOWED, WOULD NOT REMOVE ITS TOTAL BID FROM ITS POSITION AS LOWEST OF THE THREE BIDS RECEIVED.

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, OUR 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. THE RECORD DOES NOT ESTABLISH THAT THERE WAS A MUTUAL MISTAKE IN THE AWARD OF THE CONTRACT. IN FACT, IT IS NOT SHOWN THAT THERE WAS A MISTAKE, AS SUCH, IN THE BID, THE BID AND THE ACCEPTANCE THEREOF BEING AS INTENDED BY THE CONTRACTING PARTIES. THE ERROR ALLEGED BY THE SUBCONTRACTOR WAS IN NO WAY INDUCED OR CONTRIBUTED TO BY THE GOVERNMENT -- THE BID INVITATION DESCRIPTION BEING CLEAR AS TO THE WORK AND MATERIALS INCLUDED. THERE WAS NOTHING ON THE FACE OF THE BID OF THE CONTRACTOR TO INDICATE THAT THE PRICE WAS NOT AS INTENDED. THE ITEM PRICE WAS A LUMP-SUM BID FOR LABOR AND MATERIALS AS TO WHICH THERE IS NO REQUIREMENT FOR THE CONTRACTING OFFICER TO VERIFY THE PRICES OF THE COMPONENTS, ALTHOUGH THE SPECIFICATIONS CLEARLY DETAIL THE KIND AND NUMBER OF COMPONENTS. THE CONTRACTING OFFICER HAS REPORTED THAT HE HAD NO REASON TO SUSPECT AN ERROR IN THE BID SINCE THE OTHER TWO BIDS RANGED CLOSELY IN AMOUNT WITH THAT OF MACQUINN AND ALL BIDS WERE WITHIN THE GOVERNMENT ESTIMATE. UNDER THESE CIRCUMSTANCES, SUCH AN ERROR AS ALLEGED DOES NOT ENTITLE THE CONTRACTOR TO RELIEF FROM ITS OBLIGATION TO PERFORM AT THE CONTRACT PRICE. RATHER, THE CONTRACTOR MUST ASSUME THE CONSEQUENCES OF THE ERROR OR LOOK TO HIS SUBCONTRACTOR FOR PRICE ADJUSTMENT. SEE 18 COMP. GEN. 28; 31 ID. 479; 38 ID. 517. 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 EDWIN DOUGHERTY AND M. H. OGDEN V UNITED STATES, 102 CT. CL. 249; 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 FRASIER-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 TO THE CONTRACTOR'S NEGLIGENCE OR OVERSIGHT AND WAS NOT IN ANY WAY INDUCED OR CONTRIBUTED TO BY THE GOVERNMENT.

ACCORDINGLY, THERE IS NO LEGAL BASIS FOR RELIEVING THE CONTRACTOR FROM ITS OBLIGATION TO PERFORM IN ACCORDANCE WITH THE TERMS OF THE CONTRACT. THE SUBMITTED FILE IS RETURNED HEREWITH.