B-164620, SEPT. 3, 1968

B-164620, SEPT. 3, 1968

TO SOUTHWEST ENGINEERING COMPANY, INC.:

FURTHER REFERENCE IS MADE TO YOUR TELEGRAM OF JUNE 18, AND SUPPLEMENTARY LETTER OF JUNE 19, 1968, WITH ENCLOSURES, PROTESTING AGAINST THE AWARD OF CONTRACT NO. GS-06B-10741 TO ANOTHER BIDDER BY THE GENERAL SERVICES ADMINISTRATION (GSA).

THE INVITATION WAS ISSUED ON APRIL 23, 1968, FOR WORK IN CONNECTION WITH THE FIREFIGHTING SYSTEM AT THE GSA-DMS DEPOT, TOPEKA, KANSAS, WITH BID OPENING SCHEDULED FOR MAY 16, 1968. TWO ADDENDUMS WERE ISSUED BUT NO CHANGE WAS MADE IN THE BID OPENING DATE. TWO BIDS WERE RECEIVED, THE LOW BID BEING MADE BY YOUR COMPANY IN THE AMOUNT OF $12,205, REDUCED IN THE AMOUNT OF $515 BY TELEGRAM RECEIVED PRIOR TO BID OPENING, THUS MAKING A NET BID OF $11,690. THE SECOND BID, FROM MCELROY REFRIGERATION AND HEATING, INC., WAS IN THE AMOUNT OF $14,654.

AFTER THE BID OPENING, YOUR COMPANY REPRESENTATIVE IN THE COURSE OF A TELEPHONE CONVERSATION WITH PROCUREMENT OFFICIALS INDICATED THAT THERE MIGHT HAVE BEEN A MISTAKE IN YOUR BID. HE WAS ADVISED THAT IF A MISTAKE WAS CLAIMED, IT WOULD BE NECESSARY TO SUBMIT DOCUMENTATION AND INFORMATION TO SUPPORT THE ALLEGED ERROR. YOU DID THIS BY LETTER DATED MAY 20, 1968, AND YOUR WORKSHEETS CLEARLY INDICATED AN ERROR IN ADDITION AS EXPLAINED IN YOUR LETTER:

"YOU WILL NOTE FROM OUR ORIGINAL WORK SHEET, -ESTIMATE AND COSTS SUMMARY- , IN ADDING THE TOTALS IN THE MATERIALS COLUMN, THE FINAL FIGURE WAS ADDED AS $9,168.37, WHICH SHOULD HAVE BEEN TOTALED AS $10,168.37. "HAD THIS ERROR NOT BEEN MADE OUR BID THEN WOULD HAVE BEEN AS FOLLOWS: ,MATERIALS $10,168.37

LABOR 595.63

TOTAL $10,764.00

OVERHEAD 15 PERCENT $1,614.60

PROFIT 10 PERCENT 1,076.40 2,691.00

TOTAL BID SHOULD BE $13,455.00

BID REDUCED BY TELEGRAM MINUS 515.00

NET BID SHOULD HAVE BEEN $12,940.00"

IN RESPONSE TO YOUR REQUEST FOR CORRECTION, IT WAS ADMINISTRATIVELY DETERMINED THAT WHILE YOU HAD SUBMITTED CLEAR AND CONVINCING EVIDENCE OF THE EXISTENCE OF A MISTAKE, YOU HAD NOT PRODUCED CLEAR AND CONVINCING EVIDENCE OF THE AMOUNT OF THE INTENDED BID. BECAUSE OF THIS, IT WAS RECOMMENDED THAT YOU BE ALLOWED TO WITHDRAW YOUR BID AND YOU WERE SO ADVISED. YOU OBJECTED TO WITHDRAWING YOUR BID WHEREUPON THE CONTRACTING OFFICE REJECTED YOUR BID AND AWARDED THE CONTRACT TO THE NEXT LOWEST BIDDER ON JUNE 17, 1968, ONE DAY PRIOR TO THE EXPIRATION OF THE WAGE RATE AUTHORIZATION PROVIDED IN THE INVITATION. YOU REQUESTED THAT YOU BE PERMITTED TO PROCEED WITH THE WORK AT YOUR ORIGINAL BID OF $11,690 AND TO SUBMIT A CLAIM FOR THE DIFFERENCE BETWEEN YOUR ERRONEOUS BID AND THE BID INTENDED TO OUR OFFICE FOR SETTLEMENT.

IN REGARD TO CORRECTION OF AN ALLEGED ERROR IN BID, WE HAVE HELD THAT TO PERMIT CORRECTION PRIOR TO AWARD A BIDDER MUST SUBMIT CLEAR AND CONVINCING EVIDENCE THAT AN ERROR HAS BEEN MADE, THE MANNER IN WHICH THE ERROR OCCURRED, AND THE INTENDED BID PRICE. 35 COMP. GEN. 279; 31 ID. 183; 23 ID. 596; 17 ID. 598. THE SAME BASIC REQUIREMENTS FOR THE CORRECTION OF A BID ARE ALSO FOUND IN SECTION 1-2.406-3 (A) (2) OF THE FEDERAL PROCUREMENT REGULATIONS (FPR) WHICH PROVIDES AS FOLLOWS:

"/2) A DETERMINATION MAY BE MADE PERMITTING THE BIDDER TO CORRECT HIS BID WHERE THE BIDDER REQUESTS PERMISSION TO DO SO AND CLEAR AND CONVINCING EVIDENCE ESTABLISHES BOTH THE EXISTENCE OF A MISTAKE AND THE BID ACTUALLY INTENDED. * * * IF THE EVIDENCE IS CLEAR AND CONVINCING ONLY AS TO THE MISTAKE, BUT NOT AS TO THE INTENDED BID, A DETERMINATION PERMITTING THE BIDDER TO WITHDRAW HIS BID MAY BE MADE.' FPR 1-2.406-3 (D) (5) PROVIDES AS FOLLOWS:

"/5) WHERE THE BIDDER FAILS OR REFUSES TO FURNISH EVIDENCE IN SUPPORT OF A SUSPECTED OR ALLEGED MISTAKE, THE CONTRACTING OFFICER SHALL CONSIDER THE BID AS SUBMITTED UNLESS THE AMOUNT OF THE BID IS SO FAR OUT OF LINE WITH THE AMOUNTS OF OTHER BIDS RECEIVED OR WITH THE AMOUNT ESTIMATED BY THE AGENCY OR DETERMINED BY THE CONTRACTING OFFICER TO BE REASONABLE, OR THERE ARE OTHER INDICATIONS OF ERROR SO CLEAR, AS REASONABLY TO JUSTIFY THE CONCLUSION THAT ACCEPTANCE OF THE BID WOULD BE UNFAIR TO THE BIDDER OR TO OTHER BONA FIDE BIDDERS, IN WHICH CASE IT MAY BE REJECTED * * *.'

YOU HAVE FURNISHED TO OUR OFFICE VARIOUS SUPPORTING DOCUMENTS CONSISTING OF TELEGRAM COPIES, MEMO SCRATCH SHEETS PURPORTING TO SHOW PRICE QUOTATIONS OF SOME OF YOUR SUPPLIERS AND A COPY OF YOUR BID COST ESTIMATE SHEET. THE BID COST ESTIMATE SHEET SHOWS AN ERRONEOUS ADDITION AMOUNTING TO $1,000 MADE IN TOTALING THE MATERIAL ESTIMATES. THIS SAME INFORMATION WAS FURNISHED BY YOU TO THE ADMINISTRATIVE AGENCY PRIOR TO THE AWARD.

HOWEVER, THE DOCUMENTS WHICH HAD BEEN SUBMITTED BY YOUR COMPANY TO SUPPORT YOUR CLAIM OF MISTAKE SHOW A LUMP-SUM DEDUCTION OF $515 AFTER ALL OTHER COMPUTATIONS HAD BEEN MADE. THERE IS NOTHING TO INDICATE HOW THIS FIGURE WAS ARRIVED AT. ACCORDINGLY, THERE APPEARS TO BE NO BASIS FOR ASCERTAINING WHETHER THAT FIGURE WOULD HAVE REMAINED THE SAME OR WOULD HAVE BEEN COMPUTED DIFFERENTLY UPON CORRECTION OF THE PRECEDING FIGURES. SEE B-163284, APRIL 1, 1968, 47 COMP. GEN. ---.

YOU ASSERT THAT THE $515 REDUCTION MADE BY TELEGRAM AFTER YOUR BID WAS SUBMITTED WAS BASED UPON THE MAY 13 TELEGRAPHIC AMENDMENT TO THE INVITATION FOR BIDS. THIS AMENDMENT, IDENTIFIED AS NO. 2, TO THE INVITATION, AMENDED THE PROVISIONS OF PARAGRAPH 6-04 (A) OF THE SPECIFICATIONS TO REQUIRE A "NEMA 2 ENCLOSURE WITH A 600 AMP (MINIMUM) CIRCUIT BREAKER" RATHER THAN A "NEMA 1 ENCLOSURE WITH 900 AMP (MINIMUM) CIRCUIT BREAKER" AS ORIGINALLY SPECIFIED. WE NOTE, HOWEVER, THAT THE "ESTIMATE AND COST SUMMARY" SUBMITTED BY YOU ALREADY SHOWS DELETION OF A "CUTLER-HAMMER" RVS UNIT AND THE ENTRY OF "SQUARE-D" INSTEAD AND THE FIGURE OF $9,684.47 FOR THIS ITEM. AMONG YOUR BACK-UP DOCUMENTS IS ONE SHOWING THE FOLLOWING INFORMATION:

"SQUARE D. - $10,202.00

DEDUCT FOR 600A

BREAKER IN LIEU

OF 900-A 517.53

NET $ 9,684.47"

THE FOREGOING APPEARS TO HAVE EFFECTED A REDUCTION IN THE PRICE OF THE CIRCUIT BREAKER FOR THE SUBSTITUTION SPECIFIED IN AMENDMENT NO. 2 TO THE INVITATION. THE RESULTING FIGURE OF $9,684.47 (AFTER REDUCTION OF $517.53) IS THAT SHOWN ON THE "ESTIMATE AND COST SUMMARY.' THUS, IT APPEARS THAT YOU HAD ALREADY TAKEN INTO ACCOUNT THE COST REDUCTION EFFECTED BY THE ABOVE AMENDMENT IN THE COMPUTATIONS WHICH YIELDED THE ORIGINAL BID FIGURE OF $12,205.

IN VIEW OF THE FACT THAT A $517.53 DEDUCTION HAD ALREADY BEEN MADE ON ACCOUNT OF THE SUBSTITUTION MADE BY AMENDMENT NO. 2, AND IN THE ABSENCE OF ANY BASIS OR EXPLANATION FOR MAKING TWO NEARLY IDENTICAL DEDUCTIONS FOR THE SAME CHANGE IN REQUIREMENTS, WE BELIEVE THAT THE EVIDENCE IS NOT CLEAR AND CONVINCING AS TO WHAT THE TOTAL BID WOULD HAVE BEEN HAD THE MISTAKE IN ADDITION NOT OCCURRED.

IN OUR DECISION B-159960, DECEMBER 8, 1966, WE HELD:

"SINCE YOU HAVE ALLEGED THAT AN ERROR WAS MADE IN YOUR BID (WHICH APPEARS TO BE CONFIRMED BY THE WIDE DISPARITY BETWEEN YOUR BID AS SUBMITTED AND THE OTHER BIDS SUBMITTED AND THE GOVERNMENT ESTIMATE) BUT HAVE NOT SATISFACTORILY ESTABLISHED THE CORRECTED BID PRICE, THE CONTRACTING OFFICER PROPERLY REFUSED TO MAKE AN AWARD TO YOUR FIRM AT EITHER THE CORRECTED BID PRICE * * * OR THE ORIGINAL BID AS SUBMITTED. IN OUR DECISION AT 42 COMP. GEN. 723, WE HELD UNDER SIMILAR CIRCUMSTANCES THAT WHERE A BIDDER HAS ALLEGED AND ESTABLISHED THAT AN ERROR HAS BEEN MADE IN HIS BID, AND PERMISSION HAS BEEN GRANTED TO WITHDRAW BUT NOT CORRECT THE BID, THE BIDDER MAY NOT RECEIVE THE AWARD ON THE BASIS OF THE ORIGINAL BID. SIMILARLY, WE HAVE HELD THAT A BID SHOULD BE REJECTED WHERE THE LOW BIDDER SOLICITED AWARD ON THE BASIS OF ITS BID AS SUBMITTED EVEN THOUGH IT WAS OBVIOUS THAT A MISTAKE HAD BEEN MADE IN COMPILING THE BID. WE SAID THEREIN, INTER ALIA,

"WERE THE GOVERNMENT TO ACQUIESCE, IT WOULD BE TANTAMOUNT TO ALLOWING THE OSTENSIBLE LOW BIDDER TO ELECT, AFTER BID OPENING, WHETHER TO STAND ON THE BID, OR WITHDRAW IT, ON THE GROUND OF MISTAKE DEPENDING UPON WHICH COURSE OF ACTION APPEARED TO BE IN ITS BEST INTEREST. OBVIOUSLY, THIS WOULD NOT BE FAIR TO THE OTHER BIDDERS, WHOSE BIDS HAD BEEN DISCLOSED, AND IT WOULD BE DETRIMENTAL TO THE PURPOSES SOUGHT TO BE ACCOMPLISHED BY THE STATUTES RELATING TO COMPETITIVE BIDDING.'

FROM THE FOREGOING, IT MUST BE CONCLUDED THAT THE ADMINISTRATIVE ACTIONS TAKEN IN REGARD TO YOUR BID WERE PROPERLY TAKEN IN THE CIRCUMSTANCES. ACCORDINGLY, YOUR PROTEST IS DENIED.