B-165458, NOV. 5, 1968

B-165458: Nov 5, 1968

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HARRISON: REFERENCE IS MADE TO YOUR LETTER OF OCTOBER 16. ON ACCOUNT OF AN ERROR ALLEGED TO HAVE BEEN MADE IN ITS BID UPON WHICH SAID PURCHASE ORDERS WERE BASED. QUOTATIONS WERE REQUESTED BY TELEPHONE FOR TWO ITEMS OF RED VELLUM COVER PAPER. THE THREE BIDS RECEIVED BY PHONE WERE AS FOLLOWS: ITEM 1 ITEM 2 FRANK PARSONS PAPER .2035 PER LB. .2035 PER LB. STATED THAT IF THE ORDER WAS RECEIVED BY NOON JUNE 6. AN AWARD APPARENTLY WAS MADE BY TELEPHONE AND PURSUANT THERETO. PURCHASE ORDERS NOS. 23759 AND 23760 WERE DRAWN AND DATED ON JUNE 5. THE CONTRACTOR ALLEGED THAT ITS BID PRICE OF $0.2035 PER POUND WAS IN ERROR AND THAT THE PRICE SHOULD HAVE BEEN $0.3035 PER POUND. IT WAS STATED THAT THE TWO ITEMS INVOLVED ARE MILL STOCK ITEMS AND AT THE TIME OF THE QUOTATION THE MILL PRICE WAS $29.50 CWT.

B-165458, NOV. 5, 1968

TO MR. HARRISON:

REFERENCE IS MADE TO YOUR LETTER OF OCTOBER 16, 1968, REQUESTING A DECISION WHETHER FRANK PARSONS PAPER COMPANY, INCORPORATED, MAY BE PAID AN ADDITIONAL AMOUNT UNDER PURCHASE ORDERS NOS. 23759 AND 23760, ON ACCOUNT OF AN ERROR ALLEGED TO HAVE BEEN MADE IN ITS BID UPON WHICH SAID PURCHASE ORDERS WERE BASED.

ON JUNE 3, 1968, QUOTATIONS WERE REQUESTED BY TELEPHONE FOR TWO ITEMS OF RED VELLUM COVER PAPER, TUSCON SCARLET OR EQUAL, AS FOLLOWS: "ITEM 1 - PURCHASE ORDER 23759 SPECIFIED 1,200 POUNDS (6,000 SHEETS) SIZE 26 X 40 INCHES - 1000 - 200 LBS. "ITEM 2 - PURCHASE ORDER 23760 SPECIFIED 3,100 POUNDS (20,000 SHEETS) SIZE 23 X 35 INCHES - 1000 - 155 LBS.' THE THREE BIDS RECEIVED BY PHONE WERE AS FOLLOWS:

ITEM 1 ITEM 2 FRANK PARSONS PAPER .2035 PER LB. .2035 PER LB.

COMPANY INC. $40.70 PER M SHTS. $31.54 PER M SHTS.

TOTAL $244.20 TOTAL $630.83 STANFORD PAPER COMPANY $66.50 PER M SHTS. $51.53 PER M SHTS.

TOTAL $399.00 TOTAL $1,030.60 BARTON, DUER AND KOCH $75.10 PER M SHTS. $58.20 PER M SHTS.

PAPER COMPANY TOTAL $430.60 TOTAL $1,164.00

LESS 1 PERCENT - 20 DAYS

FRANK PARSONS PAPER COMPANY CONFIRMED ITS TELEPHONED BID BY LETTER OF THE SAME DATE, JUNE 3, 1968, AND STATED THAT IF THE ORDER WAS RECEIVED BY NOON JUNE 6, 1968, DELIVERY COULD BE MADE BY JUNE 14, 1968. AN AWARD APPARENTLY WAS MADE BY TELEPHONE AND PURSUANT THERETO, PURCHASE ORDERS NOS. 23759 AND 23760 WERE DRAWN AND DATED ON JUNE 5, 1968, AND MAILED ON JUNE 6, 1968, TO FRANK PARSONS PAPER COMPANY.

BY LETTER DATED JULY 17, 1968, THE CONTRACTOR ALLEGED THAT ITS BID PRICE OF $0.2035 PER POUND WAS IN ERROR AND THAT THE PRICE SHOULD HAVE BEEN $0.3035 PER POUND. IT WAS STATED THAT THE TWO ITEMS INVOLVED ARE MILL STOCK ITEMS AND AT THE TIME OF THE QUOTATION THE MILL PRICE WAS $29.50 CWT, WITH TERMS OF 2 PERCENT - 20 DAYS, OR $28.91 NET, TO WHICH THERE WAS ADDED 5 PERCENT OR $1.44. THE LETTER INDICATES THAT THE QUOTATION SUBMITTED RESULTED FROM AN ERROR IN ADDITION. EXCEPT FOR THE ERROR THE TOTAL PRICES WOULD HAVE BEEN $364.20 FOR ITEM 1 AND $940.85 FOR ITEM 2, AND THE CONTRACTOR REQUESTS PAYMENT ACCORDINGLY. THE AMOUNTS SO REQUESTED ARE STILL BELOW THE NEXT LOWEST BIDS.

THE CONTRACTOR SUBMITTED IN SUPPORT OF THE ALLEGED ERROR INVOICES FROM ITS MILL, THE PENINSULAR PAPER COMPANY, SHOWING THAT ITS PRICE FOR THE COVERS WAS $29.50 CWT, LESS 2 PERCENT - 20 DAYS.

ON THE BASIS OF THE FACTS AND EVIDENCE OF RECORD, THERE IS NO DOUBT THAT AN ERROR WAS MADE IN THE BID AS ALLEGED. FURTHERMORE, IN VIEW OF THE DIFFERENCE BETWEEN THE AMOUNT OF THE LOW BID AND THE OTHER BIDS RECEIVED, IT APPEARS THAT THE CONTRACTING OFFICER SHOULD HAVE BEEN ON NOTICE OF THE PROBABILITY OF ERROR IN THE LOW BID AND SHOULD HAVE REQUESTED VERIFICATION THEREOF PRIOR TO AWARD. 37 COMP. GEN. 398.

ACCORDINGLY, PAYMENT FOR THE MATERIAL FURNISHED UNDER PURCHASE ORDERS NOS. 23759 AND 23760 MAY BE MADE ON THE BASIS OF A PRICE OF $0.3035 PER POUND AS RECOMMENDED.

YOUR AGENCY FILES IN THE MATTER ARE ENCLOSED. A COPY OF THIS DECISION SHOULD BE INCLUDED IN YOUR CONTRACT FILES.