B-165130, OCT. 28, 1968

B-165130: Oct 28, 1968

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SECRETARY: REFERENCE IS MADE TO A LETTER DATED AUGUST 23. FOR RELIEF FROM A MISTAKE ALLEGED TO HAVE BEEN MADE IN THE PREPARATION OF ITS BID UNDER INVITATION FOR BIDS NO. 1-68-534. 377.40 WAS THE LOWEST. THE TWO OTHER BIDS WERE $72. AFTER THE BIDS WERE OPENED ON JUNE 3. WAS REQUESTED TO VERIFY ITS BID. THE CORPORATION VERIFIED ITS BID AND WAS AWARDED THE CONTRACT ON JUNE 11. THE FIRST MISTAKE WAS A MATHEMATICAL ERROR IN COMPUTING THE PER DIEM FOR THE FLIGHT CREW. THE CONTRACTOR'S WORK SHEETS SHOW THAT PER DIEM OF $30.00 A DAY FOR 80 DAYS WAS FIGURED AS $240.00 INSTEAD OF $2. 560.00 FOR REFLIGHT ALLEGED AS THE THIRD MISTAKE WAS NEVER TRANSFERRED FROM THE ROUGH ESTIMATE WORK SHEET TO THE FINAL ESTIMATE WORK SHEET.

B-165130, OCT. 28, 1968

TO MR. SECRETARY:

REFERENCE IS MADE TO A LETTER DATED AUGUST 23, 1968, WITH ENCLOSURES, FROM YOUR DIRECTOR OF OFFICE OF PLANT AND OPERATIONS, SUBMITTING FOR CONSIDERATION AND DECISION BY OUR OFFICE A REQUEST BY HAROLD HOSKINS AND ASSOCIATES, INC., LINCOLN, NEBRASKA, FOR RELIEF FROM A MISTAKE ALLEGED TO HAVE BEEN MADE IN THE PREPARATION OF ITS BID UNDER INVITATION FOR BIDS NO. 1-68-534, ISSUED BY THE EASTERN REGION, U.S. FOREST SERVICE, DEPARTMENT OF AGRICULTURE, UNDER DATE OF MAY 10, 1968.

UNDER THE CITED INVITATION FOR BIDS THE U.S. FOREST SERVICE REQUESTED BIDS FOR AERIAL PHOTOGRAPHY OF 14,124 SQUARE MILES WITHIN THE STATE OF MAINE. OF THE THREE BIDS RECEIVED, HAROLD HOSKINS AND ASSOCIATES, INC., BID OF $54,377.40 WAS THE LOWEST. THE TWO OTHER BIDS WERE $72,032.40 AND $96,043.20, RESPECTIVELY, AS COMPARED TO THE GOVERNMENT'S ESTIMATE OF $70,000.

AFTER THE BIDS WERE OPENED ON JUNE 3, 1968, HAROLD HOSKINS AND ASSOCIATES, INC., ON JUNE 5, 1968, WAS REQUESTED TO VERIFY ITS BID. JUNE 7, 1968, THE CORPORATION VERIFIED ITS BID AND WAS AWARDED THE CONTRACT ON JUNE 11, 1968.

AT A PREWORK CONFERENCE ON JUNE 26, 1968, THE CONTRACTOR ADVISED THE CONTRACTING OFFICER THAT AN ERROR HAD BEEN MADE IN SUBMITTING HIS BID. JULY 11, 1968, THE CONTRACTING OFFICER FORWARDED IN ACCORDANCE WITH FEDERAL PROCUREMENT REGULATIONS 1-2.406-4 (F) (2), THE CONTRACTOR'S FORMAL REQUEST FOR RELIEF DATED JULY 1, 1968.

THE CONTRACTOR HAS REQUESTED AN UPWARD REVISION IN THE CONTRACT PRICE DUE TO THREE MISTAKES. THE FIRST MISTAKE WAS A MATHEMATICAL ERROR IN COMPUTING THE PER DIEM FOR THE FLIGHT CREW. THE SECOND ERROR RESULTED FROM THE CONTRACTOR INCLUDING IN HIS ESTIMATE ONLY ONE INSTEAD OF TWO SETS OF POLYESTER PHOTO INDEX PRINTS AND THE LAST ERROR RESULTED FROM THE CONTRACTOR'S FAILURE TO INCLUDE THE COST OF A REFLIGHT OF THE AREA IN HIS FINAL ESTIMATE AFTER FIGURING SUCH COST IN HIS ROUGH ESTIMATE.

THE CONTRACTOR'S WORK SHEETS SHOW THAT PER DIEM OF $30.00 A DAY FOR 80 DAYS WAS FIGURED AS $240.00 INSTEAD OF $2,400.00 RESULTING IN THE FIRST MISTAKE OF $2,160.00 AND THAT THE $2,560.00 FOR REFLIGHT ALLEGED AS THE THIRD MISTAKE WAS NEVER TRANSFERRED FROM THE ROUGH ESTIMATE WORK SHEET TO THE FINAL ESTIMATE WORK SHEET. CLOSE EXAMINATION INDICATES THAT $2,560.00 IS LISTED ON THE ROUGH WORK SHEETS FOR REFLIGHT, ALTHOUGH THE CONTRACTOR IN HIS LETTER OF JULY 1, 1968, REQUESTED A $2,810.00 INCREASE IN THE CONTRACT PRICE DUE TO THIS MISTAKE.

HAROLD HOSKINS AND ASSOCIATES, INC., HAS SHOWN AS TO THESE TWO ITEMS THAT IT MADE A BONA FIDE ERROR IN THE PREPARATION OF ITS BID, AND THAT THE PRICES STATED THEREIN WERE NOT IN ACCORD WITH ITS INTENTION, TO THE EXTENT OF THE ABOVE ERRORS. IT HAS ALSO SHOWN WHAT ITS INTENDED BID WOULD HAVE BEEN BUT FOR THE MISTAKES. THESE ARE THE TYPES OF ERRORS WHICH, WHEN SATISFACTORILY ESTABLISHED, HAVE BEEN GROUNDS FOR RELIEF IF THE CONTRACTING OFFICER SHOULD HAVE BEEN AWARE OF THE PROBABILITY OF ERROR BUT FAILED TO REQUEST VERIFICATION OF THE LOW BID PRIOR TO AWARD. SEE B- 144300, NOVEMBER 4, 1960; B-145726, MAY 12, 1961; 37 COMP. GEN. 654 (1958). THERE IS FOR CONSIDERATION IN THIS CASE, HOWEVER, THE QUESTION WHETHER RELIEF MAY BE GRANTED SINCE VERIFICATION OF THE BID WAS REQUESTED AND RECEIVED BY THE CONTRACTING OFFICER BEFORE AWARD.

GENERALLY, AWARD OF A CONTRACT FOLLOWING VERIFICATION OF THE BID UPON REQUEST OF THE CONTRACTING OFFICER RESULTS IN A BINDING CONTRACT. COMP. GEN. 942, 947; 27 ID. 17. NEVERTHELESS, THE CONTRACTING OFFICER CANNOT DISCHARGE HIS VERIFICATION DUTY MERELY BY REQUESTING CONFIRMATION OF THE BID PRICE -- THE GOVERNMENT MUST APPRAISE THE BIDDER OF THE MISTAKE WHICH IS SUSPECTED AND THE BASIS FOR SUCH SUSPICION. SEE B-154955, AUGUST 26, 1964; B-144238, OCTOBER 28, 1960; 35 COMP. GEN. 136 (1955).

THE GOVERNMENT'S TELEGRAPHIC REQUEST BY THE REGIONAL ADMINISTRATIVE OFFICER, TO HAROLD HOSKINS AND ASSOCIATES, INC., TO "PLEASE VERIFY YOUR APPARENT LOW BID OF $54,377.40 * * * BY RETURN WIRE" DID NOT APPRISE THE LOW BIDDER OF THE REASON THAT A MISTAKE WAS SUSPECTED. SINCE THE LOWEST BID WAS CONSIDERABLY LOWER THAN THE NEXT BID THE GOVERNMENT WAS ON NOTICE OF THE PROBABILITY OF A MISTAKE, AND THE REGIONAL ADMINISTRATIVE OFFICER SHOULD HAVE ADVISED THE CONTRACTOR OF THE DISPARITY IN THE BID PRICES IN THE REQUEST FOR VERIFICATION. 37 COMP. GEN. 786, 788 (1958). SEE ALSO B- 158207, JANUARY 14, 1966; B 134428, JANUARY 16, 1958. SECTION 1-2.406-3 (D) (1) OF THE FEDERAL PROCUREMENT REGULATIONS SPECIFICALLY PROVIDES THAT THE "* * * REQUEST SHALL INFORM THE BIDDER WHY THE REQUEST FOR VERIFICATION IS MADE - THAT A MISTAKE IS SUSPECTED AND THE BASIS FOR SUCH SUSPICION, E.G., THAT THE BID IS SIGNIFICANTLY OUT OF LINE WITH THE NEXT LOW OR OTHER BIDS OR WITH THE GOVERNMENT'S ESTIMATE.' SEE B-163031, FEBRUARY 9, 1968.

SINCE THERE WAS AN INADEQUATE VERIFICATION REQUEST BY THE GOVERNMENT AND THE FIRST AND THIRD ERRORS ALLEGED BY HAROLD HOSKINS AND ASSOCIATES, INC., HAVE BEEN SUBSTANTIATED AND SHOWN TO BE BONA FIDE, PAYMENT OF AN ADDITIONAL AMOUNT OF $4,720 IS DEEMED APPROPRIATE, THE CORRECTED PRICE NOT BEING IN EXCESS OF THE NEXT LOWEST BID.

AS TO THE SECOND ERROR ALLEGED, HOWEVER, WHICH WAS THAT THE BID PRICE COVERED ONLY ONE SET OF POLYESTER-BASE PHOTO INDEX PRINTS, WHEREAS ARTICLE 9 OF THE SPECIFICATIONS CLEARLY CALLED FOR DELIVERY OF TWO SETS, NEITHER THE ROUGH NOR FINAL WORK SHEETS SHOW THAT ANY FIGURE WAS EVER COMPUTED TO COVER TWO SETS. WE THEREFORE CANNOT CONCLUDE THAT THE BIDDER INTENDED TO INCLUDE AN ADDITIONAL AMOUNT OF $1,117 FOR A SECOND SET, OR ANY AMOUNT OTHER THAN THE ONE WHICH WAS INCLUDED. FURTHER, THE BIDDER QUOTED UNDER "OPTIONAL ITEMS" OF SCHEDULE 1 A PRICE OF $935 FOR AN ADDITIONAL SET OF POLYESTER-BASE PRINTS -- A FIGURE WHICH DOES NOT APPEAR TO HAVE BEEN BASED ON ANY COMPUTATIONS SHOWN ON THE WORK SHEETS -- AND IT THEREFORE CANNOT BE SAID THAT THE AMOUNT WHICH IT MIGHT HAVE BID ON TWO SETS, IF IT HAD IN FACT INTENDED TO DO SO, IS CLEARLY ESTABLISHED.

A REFERENCE TO THIS DECISION SHOULD BE MADE ON THE AMENDMENT TO THE CONTRACT. AS REQUESTED, THE ENCLOSURES FURNISHED WITH THE LETTER OF AUGUST 23, 1968, ARE RETURNED.