B-167997, OCT. 17, 1969

B-167997: Oct 17, 1969

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CONTRACTING OFFICER'S ERROR DETECTION DUTY CONTRACTOR WHO FAILED TO INCLUDE STATEMENT IN BID AS TO TYPE OF BOARD IT PROPOSED TO FURNISH AND WAS INFORMED AFTER AWARD THAT BOARD OFFERED DID NOT MEET BID SPECIFICATIONS. MAY HAVE CONTRACT PRICE AMENDED SO AS TO REFLECT INCREASED COST OF BOARD REQUIRED SINCE ADDITIONAL AMOUNT CLAIMED WOULD NOT EXCEED NEXT LOW BID. WHICH WAS SOME 45 PERCENT HIGHER THAN LOW BIDDER'S AND MISTAKE WAS SO APPARENT THAT CONTRACTING OFFICER SHOULD HAVE BEEN ON CONSTRUCTIVE NOTICE OF POSSIBILITY OF ERROR AND SHOULD HAVE REQUESTED CONFIRMATION OF BID PRIOR TO CONTRACT AWARD. SECRETARY: REFERENCE IS MADE TO LETTER DATED SEPTEMBER 26. REQUESTING A DECISION AS TO WHETHER CONTRACT NO. 17-877 WITH GRANGEVILLE LUMBER COMPANY MAY BE INCREASED BECAUSE OF AN ERROR MADE BY THE CONTRACTOR IN ITS BID ON WHICH THE CONTRACT WAS BASED.

B-167997, OCT. 17, 1969

MISTAKES--ALLEGATION AFTER AWARD--PRICE ADJUSTMENT--CONTRACTING OFFICER'S ERROR DETECTION DUTY CONTRACTOR WHO FAILED TO INCLUDE STATEMENT IN BID AS TO TYPE OF BOARD IT PROPOSED TO FURNISH AND WAS INFORMED AFTER AWARD THAT BOARD OFFERED DID NOT MEET BID SPECIFICATIONS, AND WHO THEREAFTER ALLEGED ERROR IN BID, MAY HAVE CONTRACT PRICE AMENDED SO AS TO REFLECT INCREASED COST OF BOARD REQUIRED SINCE ADDITIONAL AMOUNT CLAIMED WOULD NOT EXCEED NEXT LOW BID, WHICH WAS SOME 45 PERCENT HIGHER THAN LOW BIDDER'S AND MISTAKE WAS SO APPARENT THAT CONTRACTING OFFICER SHOULD HAVE BEEN ON CONSTRUCTIVE NOTICE OF POSSIBILITY OF ERROR AND SHOULD HAVE REQUESTED CONFIRMATION OF BID PRIOR TO CONTRACT AWARD.

TO MR. SECRETARY:

REFERENCE IS MADE TO LETTER DATED SEPTEMBER 26, 1969, FROM THE ACTING DIRECTOR, OFFICE OF PLANT AND OPERATIONS, REQUESTING A DECISION AS TO WHETHER CONTRACT NO. 17-877 WITH GRANGEVILLE LUMBER COMPANY MAY BE INCREASED BECAUSE OF AN ERROR MADE BY THE CONTRACTOR IN ITS BID ON WHICH THE CONTRACT WAS BASED.

BY INVITATION NO. 17-69-35 DATED MAY 20, 1969, LUMP-SUM BIDS WERE REQUESTED FOR FURNISHING LUMBER, DOORS AND RELATED ITEMS. TWO BIDS WERE RECEIVED IN RESPONSE TO THE INVITATION. THE BID OF GRANGEVILLE LUMBER COMPANY WAS IN THE AMOUNT OF $3,077.76 AND THE OTHER BID WAS IN THE AMOUNT OF $4,477.34. THE CONTRACTING OFFICER AWARDED THE CONTRACT TO GRANGEVILLE LUMBER COMPANY ON JUNE 4, 1969.

THE RECORD SHOWS THAT PRIOR TO THE ISSUANCE OF THE SUBJECT FORMAL INVITATION FOR BIDS A REQUEST FOR QUOTATIONS (RFQ) NO. 179-10-47Q WAS ISSUED ON APRIL 29, 1969, SOLICITING UNIT PRICE OFFERS FOR THE SAME ITEMS. SINCE THE QUOTATIONS RECEIVED EXCEEDED THE OPEN MARKET LIMITATION, NO CONTRACT WAS AWARDED AND THE SUBJECT INVITATION WAS ISSUED. RESPONSE TO THE RFQ, GRANGEVILLE LUMBER COMPANY, THE CONTRACTOR HERE INVOLVED, QUOTED A PRICE OF $20.50 PER SHEET FOR 52 SHEETS OF PLASTIC LAMINATED BOARD. INCLUDED WITH ITS QUOTATION ON THIS ITEM WAS A STATEMENT SHOWING THE TYPE OR COMPOSITION OF BOARD IT PROPOSED TO FURNISH. WHEN GRANGEVILLE LUMBER COMPANY SUBMITTED ITS BID UNDER THE INSTANT INVITATION, IT FAILED TO INCLUDE A STATEMENT AS TO THE TYPE OF BOARD IT PROPOSED TO FURNISH. AFTER AWARD OF THE CONTRACT WAS RECEIVED, THE CONTRACTOR SUBMITTED A SAMPLE OF THE BOARD IT PROPOSED TO FURNISH AND WAS ADVISED THAT THE BOARD DID NOT MEET THE REQUIREMENTS OF THE SPECIFICATIONS. THE CONTRACTOR THEN OBTAINED A QUOTATION ON AN ACCEPTABLE BOARD AND ON JULY 2, 1969, ALLEGED AN ERROR IN ITS BID AND ASKED THAT ITS CONTRACT PRICE BE INCREASED BY $1,012.96.

THE CONTRACTING OFFICER STATES IN A MEMORANDUM OF AUGUST 4, 1969, THAT THE EVIDENCE FURNISHED BY THE CONTRACTOR IN SUPPORT OF ITS CLAIM OF ERROR IS CLEAR AND CONVINCING. THE CONTRACTING OFFICER FURTHER STATES THAT HE SHOULD HAVE BEEN AWARE THAT THE BID OF GRANGEVILLE LUMBER COMPANY WAS UNUSUALLY LOW WHEN COMPARED WITH THE OTHER BID RECEIVED. THE CONTRACTING OFFICER ALSO STATES THAT THE AMOUNT OF $35.50 PER SHEET ALLEGED BY THE CONTRACTOR TO BE ITS COST IS FAIR AND REASONABLE AND THAT ALLOWANCE OF THE ADDITIONAL AMOUNT OF $1,012.96 CLAIMED WOULD NOT EXCEED THE NEXT LOW BID.

SINCE THE SECOND BID WAS SOME 45 PERCENT HIGHER THAN THE LOW BID, WE AGREE WITH THE ACTING DIRECTOR AS WELL AS THE CONTRACTING OFFICER THAT A MISTAKE IN BID WAS SO APPARENT THAT THE CONTRACTING OFFICER SHOULD HAVE BEEN ON CONSTRUCTIVE NOTICE OF THE PROBABILITY OF ERROR AND THEREFORE SHOULD HAVE REQUESTED CONFIRMATION OF THE BID BEFORE AWARDING THE CONTRACT.

ACCORDINGLY, THE CONTRACT MAY BE AMENDED TO INCREASE THE PRICE BY $1,012.96 AS ADMINISTRATIVELY RECOMMENDED. A COPY OF THIS DECISION SHOULD BE PLACED IN THE CONTRACT FILE.