B-165330, OCT. 10, 1968

B-165330: Oct 10, 1968

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DRIVER: THIS IS IN RESPONSE TO A LETTER DATED SEPTEMBER 23. THE AWARD TO EMERSON-SACK-WARNER FOR ITEM 12 WAS MADE IN CONNECTION WITH SOLICITATION NO. ITEMS 1 THROUGH 11 AND 13 THROUGH 16 WERE ESSENTIALLY IDENTICAL. WAS A MUCH LARGER MACHINE HAVING APPROXIMATELY TWICE THE CAPACITY OF THE OTHER MACHINES FOR WHICH THE SOLICITATION WAS ISSUED. WHEN A UNILATERAL ERROR IS ALLEGED AFTER AWARD. THE CONTRACT IS PRESUMED IN LAW TO EXPRESS THE UNDERSTANDING OF THE PARTIES. WHEN THE PARTY NOT IN ERROR SHOULD HAVE SUSPECTED OR HAD REASON TO KNOW OF THE EXISTENCE OF THE ERROR. RESCISSION OF THE CONTRACT IS ALLOWED. 37 COMP. WAS IDENTICAL TO THE BID PRICES FOR THE OTHER SMALLER MACHINES. THE CONTRACTING OFFICER WAS ON CONSTRUCTIVE NOTICE OF THE POSSIBILITY OF AN ERROR AND SHOULD HAVE OBTAINED VERIFICATION OF THE BID PRICE.

B-165330, OCT. 10, 1968

TO MR. DRIVER:

THIS IS IN RESPONSE TO A LETTER DATED SEPTEMBER 23, 1968, YOUR REFERENCE 134G, FROM THE DIRECTOR, SUPPLY SERVICE, DEPARTMENT OF MEDICINE AND SURGERY, IN WHICH HE RECOMMENDS CANCELLATION OF PURCHASE ORDER NO. 68-MC- 30312 ISSUED TO THE EMERSON-SACK-WARNER CORP. FOR ITEM 12, A POT AND PAN WASHING MACHINE.

THE AWARD TO EMERSON-SACK-WARNER FOR ITEM 12 WAS MADE IN CONNECTION WITH SOLICITATION NO. M3-95-68 ISSUED BY THE VETERANS ADMINISTRATION MARKETING CENTER, HINES, ILLINOIS, FOR 16 LINE ITEMS OF POT AND PAN WASHING MACHINES. ITEMS 1 THROUGH 11 AND 13 THROUGH 16 WERE ESSENTIALLY IDENTICAL, VARYING ONLY IN EXACT REQUIREMENTS. ITEM 12, HOWEVER, WAS A MUCH LARGER MACHINE HAVING APPROXIMATELY TWICE THE CAPACITY OF THE OTHER MACHINES FOR WHICH THE SOLICITATION WAS ISSUED. NEVERTHELESS, THE EMERSON -SACK-WARNER CORP. SUBMITTED IDENTICAL BID PRICES ON ALL 16 ITEMS OF $4,862. EMERSON NOW REQUESTS WITHDRAWAL OF ITS BID ON ITEM 12 CLAIMING THAT IT ERRED IN PRICING THE BID FOR THIS PARTICULAR ITEM.

AS A GENERAL RULE, WHEN A UNILATERAL ERROR IS ALLEGED AFTER AWARD, THE CONTRACT IS PRESUMED IN LAW TO EXPRESS THE UNDERSTANDING OF THE PARTIES. HOWEVER, WHEN THE PARTY NOT IN ERROR SHOULD HAVE SUSPECTED OR HAD REASON TO KNOW OF THE EXISTENCE OF THE ERROR, RESCISSION OF THE CONTRACT IS ALLOWED. 37 COMP. GEN. 685, 686; MOFFETT, HODGKINS AND CLARKE COMPANY V ROCHESTER, 178 U.S. 373.

THE DIRECTOR, SUPPLY SERVICE, EXPRESSES THE VIEW THAT BY VIRTUE OF THE FACT THAT THE BID PRICE SUBMITTED FOR ITEM 12, A MACHINE TWICE AS LARGE AS ANY OF THE OTHERS, WAS IDENTICAL TO THE BID PRICES FOR THE OTHER SMALLER MACHINES, THE CONTRACTING OFFICER WAS ON CONSTRUCTIVE NOTICE OF THE POSSIBILITY OF AN ERROR AND SHOULD HAVE OBTAINED VERIFICATION OF THE BID PRICE.

WE CONCUR IN THAT VIEW. ACCORDINGLY, ITEM 12 MAY BE CANCELED WITHOUT LIABILITY ON THE PART OF THE CORPORATION.

THE ENCLOSURES WITH YOUR LETTER OF SEPTEMBER 23 ARE RETURNED HEREWITH AS REQUESTED.