B-166748, MAY 14, 1969, 48 COMP. GEN. 748

B-166748: May 14, 1969

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RULE BECAUSE THE CORRECTION OF MISTAKES IN BID IS ALWAYS A VEXING PROBLEM. CORRECTION AFTER BID OPENING SHOULD BE DENIED WHERE THERE IS ANY REASONABLE BASIS FOR ARGUMENT THAT PUBLIC CONFIDENCE IN THE INTEGRITY OF THE COMPETITIVE BIDDING SYSTEM WOULD BE ADVERSELY AFFECTED. EVEN THOUGH THE POSITION OF THE LOW BIDDER WOULD REMAIN UNCHANGED AND THE EVIDENCE SUBMITTED SUPPORTS THE CONCLUSION AN ERROR WAS MADE. AS THE FACTS ARE NOT SUFFICIENTLY CLEAR TO WARRANT A BID CORRECTION THAT WOULD RESULT IN MAKING THE LOW OVERALL BID LESS THAN $500 LOWER THAN THE SECOND LOW BID. 1969: REFERENCE IS MADE TO LETTER DATED APRIL 29. SIX BIDS WERE RECEIVED AND PUBLICLY OPENED IN THE GENERAL SERVICES ADMINISTRATION (GSA).

B-166748, MAY 14, 1969, 48 COMP. GEN. 748

BIDS--MISTAKES--CORRECTION--AFTER OPENING--RULE BECAUSE THE CORRECTION OF MISTAKES IN BID IS ALWAYS A VEXING PROBLEM, CORRECTION AFTER BID OPENING SHOULD BE DENIED WHERE THERE IS ANY REASONABLE BASIS FOR ARGUMENT THAT PUBLIC CONFIDENCE IN THE INTEGRITY OF THE COMPETITIVE BIDDING SYSTEM WOULD BE ADVERSELY AFFECTED. THEREFORE, WHERE THE LOW BIDDER FOR CONSTRUCTION OF A POST OFFICE AND FEDERAL BUILDING ALLEGES OMISSION FROM ITS BID OF THE $21,000 BID BY AN ELECTRICAL SUBCONTRACTOR, AND PRICES FOR THE ITEM RANGE FROM THE GOVERNMENT'S ESTIMATE OF $31,000 TO THAT OF THE SECOND LOW BID OF $27,500, THE BID MAY NOT BE CORRECTED, EVEN THOUGH THE POSITION OF THE LOW BIDDER WOULD REMAIN UNCHANGED AND THE EVIDENCE SUBMITTED SUPPORTS THE CONCLUSION AN ERROR WAS MADE, AS THE FACTS ARE NOT SUFFICIENTLY CLEAR TO WARRANT A BID CORRECTION THAT WOULD RESULT IN MAKING THE LOW OVERALL BID LESS THAN $500 LOWER THAN THE SECOND LOW BID, BUT THE ERRONEOUS BID MAY BE WITHDRAWN.

TO THE ADMINISTRATOR, GENERAL SERVICES ADMINISTRATION, MAY 14, 1969:

REFERENCE IS MADE TO LETTER DATED APRIL 29, 1969, FROM YOUR GENERAL COUNSEL, FURNISHING A REPORT ON THE PROTEST BY FUSELIER, HECTOR, ROBERTSON & OTT, ATTORNEYS, ON BEHALF OF ACS CONSTRUCTION COMPANY OF GREENWOOD, MISSISSIPPI, AGAINST AN AWARD OF A CONTRACT ON THE BASIS OF A CORRECTED BID TO THE DAWSON CONSTRUCTION COMPANY, INCORPORATED, FOR CONSTRUCTION OF A POST OFFICE AND FEDERAL BUILDING AT WARTBURG, TENNESSEE, PROJECT NO. 410101.

IN ACCORDANCE WITH THE INVITATION FOR BIDS ON THE ABOVE PROJECT, SIX BIDS WERE RECEIVED AND PUBLICLY OPENED IN THE GENERAL SERVICES ADMINISTRATION (GSA), ATLANTA, GEORGIA, REGIONAL OFFICE, AT 2:30 P.M. ON FRIDAY, APRIL 4, 1969. THE BASE AMOUNTS OF THE BIDS WERE AS FOLLOWS: DAWSON CONSTRUCTION COMPANY, INCORPORATED $249,592 ACS CONSTRUCTION COMPANY

$272,464 KNOXVILLE SOUTHEAST CONSTRUCTION COMPANY, INCORPORATED $276,300 HUNTSVILLE BUILDERS SUPPLY $298,900 HAROLD CONSTRUCTION CORPORATION $313,000 TECTONICS, INCORPORATED

$314,000

IT IS REPORTED THAT ON THE FOLLOWING MONDAY, APRIL 7, 1969, AT 9:15 A.M; MR. TOM DAWSON, PRESIDENT OF DAWSON CONSTRUCTION COMPANY, INCORPORATED, TELEPHONED THE ATLANTA REGIONAL OFFICE TO ADVISE THAT HE HAD MADE A MISTAKE IN BID BY LEAVING OUT THE COST OF THE ELECTRICAL WORK. HE WAS INFORMED THAT HE WOULD HAVE TO PRESENT NECESSARY DOCUMENTATION TO SUPPORT HIS CLAIM OF MISTAKE. ON THE SAME DAY THE REGIONAL OFFICE CONFIRMED BY LETTER THE TELEPHONE CONVERSATION WITH MR. DAWSON ENUMERATING WHAT INFORMATION AND SUPPORT DATA SHOULD BE FURNISHED WITH RESPECT TO THE CLAIM OF MISTAKE. BY LETTER DATED APRIL 9, 1969, DAWSON SUBMITTED A COPY OF ITS BID, ITS BID WORKSHEETS, AND COPIES OF LETERS DATED APRIL 9, 1969, CONFIRMING ORAL QUOTATIONS RECEIVED FROM ITS ELECTRICAL AND PLUMBING, HEATING AND AIR CONDITIONING SUBCONTRACTORS, TOGETHER WITH OTHER QUOTATIONS RECEIVED FROM SUPPLIERS USED IN COMPUTING ITS BID. ON APRIL 10, 1969, MR. DAWSON SWORE TO THE VERACITY OF THE DATA SUBMITTED.

IT IS FURTHER REPORTED THAT A REVIEW OF DOCUMENTATION SUBMITTED IN SUPPORT OF THE CLAIMED MISTAKE REVEALS THAT DAWSON FAILED TO TRANSFER AND LIST ITS ELECTRICAL SUBCONTRACTOR'S BID OF $21,000 (LISTED AS 47 48 OF THE SPECIFICATIONS) FROM SHEET NO. 14 OF ITS WORKSHEETS TO ITS SUMMARY SHEET AND THUS OMITTED IT ENTIRELY FROM THE BID COMPUTATION. IT APPEARS CLEAR THAT THE ERROR OCCURRED IN GROUPING SECTION 42-48 (MECHANICAL AND ELECTRICAL PORTIONS OF THE SPECIFICATIONS) ON ITS RECAPITULATION SHEET AS "PLUMBING, HTG. & AC" AND SETTING FORTH THE COST THEROF AS $55,685 (THIS FIGURE IS THE QUOTE FROM THE PLUMBING, HEATING AND AIR-CONDITIONING SUBCONTRACTOR) RATHER THAN SEPARATELY LISTING THOSE CATEGORIES AS "42-46 MECHANICAL-$55,685" AND "47-48 ELECTRICAL-$21,000" AS THEY APPEAR ON SHEET NO. 14. THE BID IF CORRECTED TO INCLUDE THE ELECTRICAL WORK, WOULD STILL LEAVE DAWSON THE LOWEST BIDDER.

WE AGREE THAT THE EVIDENCE SUBMITTED SUPPORTS A CONCLUSION THAT DAWSON MADE AN ERROR IN ITS BID. HOWEVER, IN VIEW OF ALL THE CIRCUMSTANCES INVOLVED WE DO NOT BELIEVE THAT THE FACTS ARE SUFFICIENTLY CLEAR TO WARRANT CORRECTION OF THE BID TO $271,851, OR ONLY $613 LESS THAN THE AMOUNT OF THE NEXT LOW BID. FURTHER IF AN APPROPRIATE ADJUSTMENT WERE MADE, AS REQUIRED FOR EVALUATION PURPOSES, IN BOND COSTS THE DIFFERENCE WOULD BE LESS THAN $500.

THE GOVERNMENT'S ESTIMATE WAS $57,000 FOR THE PLUMBING, HEATING AND AIR CONDITIONING AND $31,000 FOR THE ELECTRICAL WORK. ASIDE FROM ACS CONSTRUCTION COMPANY, THE SECOND LOW BIDDER, THREE OF THE FOUR OTHER BIDDERS PROPOSED TO USE THE SAME SUBCONTRACTOR FOR THE ELECTRICAL WORK AND WE ARE ADVISED THAT THE SUBCONTRACTOR'S PRICE FOR SUCH WORK WAS $30,300. ACS CONSTRUCTION COMPANY ADVISES THAT IT ALSO RECEIVED A QUOTATION OF $30,300 FOR THE ELECTRICAL WORK FROM THIS SAME SUBCONTRACTOR BUT DECIDED TO PERFORM THE ELECTRICAL WORK ITSELF AT AN ESTIMATED COST OF $27,500. UNDERSTAND THAT THE OTHER BIDDER PROPOSED TO USE ANOTHER ELECTRICAL SUBCONTRACTOR AND THAT HIS PRICE FOR THE WORK WAS $30,000.

THE CORRECTION OF MISTAKES IN BID HAS ALWAYS BEEN A VEXING PROBLEM. HAS BEEN ARGUED THAT BID CORRECTION AFTER BID OPENING AND DISCLOSURE OF PRICES QUOTED COMPROMISES THE INTEGRITY OF THE COMPETITIVE BIDDING SYSTEM, AND, TO SOME EXTENT AT LEAST, THIS IS TRUE. FOR THIS REASON, IT HAS BEEN ADVOCATED THAT THE GOVERNMENT SHOULD ADOPT A POLICY WHICH WOULD PERMIT CONTRACTORS TO WITHDRAW, BUT NOT TO CORRECT, ERRONEOUS BIDS. WE DO NOT AGREE COMPLETELY WITH THIS POSITION, SINCE WE BELIEVE THERE ARE CASES IN WHICH BID CORRECTION SHOULD BE PERMITTED. WE DO AGREE THAT, REGARDLESS OF THE GOOD FAITH OF THE PARTY OR PARTIES INVOLVED, CORRECTION SHOULD BE DENIED IN ANY CASE IN WHICH THERE EXISTS ANY REASONABLE BASIS FOR ARGUMENT THAT PUBLIC CONFIDENCE IN THE INTEGRITY OF THE COMPETITIVE BIDDING SYSTEM WOULD BE ADVERSELY AFFECTED THEREBY. THE PRESENT CASE, IT SEEMS TO US, FALLS IN THIS CATEGORY.

ACCORDINGLY, YOU ARE ADVISED THAT THE DAWSON CONSTRUCTION COMPANY, INCORPORATED, SHOULD BE PERMITTED TO WITHDRAW ITS BID, BUT THAT THE BID SHOULD NOT BE CORRECTED.

THE DAWSON CONSTRUCTION COMPANY, INCORPORATED, HAS BEEN FURNISHED A COPY OF THIS DECISION.

THE ENCLOSURES FORWARDED WITH THE LETTER OF APRIL 29, 1969, ARE RETURNED AS REQUESTED.