B-168049, DEC. 2, 1969

B-168049: Dec 2, 1969

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ACCEPTANCE OF CONTRACT BIDDER UNDER INVITATION FOR AIR HEATER TUBES WHO FAILED TO NOTE SPECIFICATION REQUIREMENT THAT TUBES BE HOT OIL COATED AND SPECIALLY BOXED IS REQUESTING INCREASE OF $2. NO LEGAL BASIS EXISTS FOR RELIEVING CONTRACTOR FROM OBLIGATION UNDER CONTRACT SINCE ERROR WAS DUE SOLELY TO BIDDER'S NEGLIGENCE. WAS UNILATERAL AND DOES NOT ENTITLE CONTRACTOR TO RELIEF. INC.: FURTHER REFERENCE IS MADE TO YOUR LETTER OF OCTOBER 3. REQUESTING RELIEF IN CONNECTION WITH AN ERROR ALLEGED TO HAVE BEEN MADE IN YOUR BID WHICH IS THE BASIS OF DEPARTMENT OF THE ARMY CONTRACT NO. PROSPECTIVE BIDDERS WERE REQUESTED TO QUOTE PRICES F.O.B. YOUR FIRM'S BID "B" WAS ACCEPTED ON JUNE 23. IT IS REPORTED THAT WHEN THE GOVERNMENT INSPECTOR TELEPHONED YOUR SUPPLIER.

B-168049, DEC. 2, 1969

MISTAKES--ALLEGATION AFTER AWARD--ACCEPTANCE OF CONTRACT BIDDER UNDER INVITATION FOR AIR HEATER TUBES WHO FAILED TO NOTE SPECIFICATION REQUIREMENT THAT TUBES BE HOT OIL COATED AND SPECIALLY BOXED IS REQUESTING INCREASE OF $2,640 IN CONTRACT PRICE TO COVER ADDITIONAL COST BUT, SINCE CONTRACTING OFFICER HAD NO REASON TO SUSPECT ERROR IN BID, DIFFERENCE IN BIDS RECEIVED NOT WARRANTING CONCLUSION OF LIKELIHOOD OF ERROR AND NO ERROR BEING ALLEGED UNTIL AFTER AWARD, ACCEPTANCE OF BID CONSTITUTED VALID AND BINDING CONTRACT WHICH FIXED RIGHTS AND LIABILITIES OF PARTIES. THEREFORE, NO LEGAL BASIS EXISTS FOR RELIEVING CONTRACTOR FROM OBLIGATION UNDER CONTRACT SINCE ERROR WAS DUE SOLELY TO BIDDER'S NEGLIGENCE, WAS UNILATERAL AND DOES NOT ENTITLE CONTRACTOR TO RELIEF.

TO A.B. MURRAY CO; INC.:

FURTHER REFERENCE IS MADE TO YOUR LETTER OF OCTOBER 3, 1969, WITH ENCLOSURES, REQUESTING RELIEF IN CONNECTION WITH AN ERROR ALLEGED TO HAVE BEEN MADE IN YOUR BID WHICH IS THE BASIS OF DEPARTMENT OF THE ARMY CONTRACT NO. DACW29-69-C-0177.

THE U.S. ARMY ENGINEER DISTRICT, NEW ORLEANS, CORPS OF ENGINEERS, NEW ORLEANS, LOUISIANA, BY INVITATION FOR BIDS NO. DACW29-69-B-0137, REQUESTED BIDS FOR FURNISHING 3,232 AIR HEATER TUBES FOR COMBER CLASS DREDGES IN ACCORDANCE WITH THE GOVERNMENT'S SPECIFICATIONS. PROSPECTIVE BIDDERS WERE REQUESTED TO QUOTE PRICES F.O.B. CONTRACTOR'S POINT OF ORIGIN UNDER BID "A" AND F.O.B. DESTINATION UNDER BID "B.' IN RESPONSE, YOUR FIRM SUBMITTED A BID DATED MAY 14, 1969, OFFERING TO FURNISH THE AIR HEATER TUBES UNDER BID "A" AT A UNIT PRICE OF $2.12 AND TO FURNISH THE AIR HEATER TUBES UNDER BID "B" AT A UNIT PRICE OF $2.25. YOUR FIRM'S BID "B" WAS ACCEPTED ON JUNE 23, 1969.

IT IS REPORTED THAT WHEN THE GOVERNMENT INSPECTOR TELEPHONED YOUR SUPPLIER, JONES AND LAUGHLIN STEEL COMPANY, TO MAKE ARRANGEMENTS FOR THE INSPECTION OF THE AIR HEATER TUBES AT ITS PLANT, HE LEARNED THAT YOUR SUPPLIER WAS UNAWARE OF THE "PREPARATION FOR DELIVERY" REQUIREMENTS OF THE SPECIFICATIONS, PARTICULARLY THAT PART RELATING TO THE BOXING AND PRESERVATIVE COATING REQUIREMENTS.

IN A LETTER DATED AUGUST 28, 1969, YOU ADVISED THE CONTRACTING OFFICER THAT YOU AND YOUR SUPPLIER HAD FAILED TO NOTE THAT THE SPECIFICATIONS REQUIRED THAT THE AIR HEATER TUBES BE COATED WITH A HOT COATING OIL AND SPECIALLY BOXED; THAT YOUR SUPPLIER DOES NOT HAVE ANY FACILITIES FOR HOT COATING OIL; AND THAT YOUR SUPPLIER CANNOT OFFER ANY SUBSTITUTE FOR PRESERVING THE TUBES FOR LONG STORAGE IN A HIGH HUMIDITY CLIMATE. YOU REQUESTED THAT THE CONTRACT BE CANCELED WITHOUT LIABILITY TO YOUR FIRM. BY LETTER DATED SEPTEMBER 19, 1969, YOU ADVISED THE CONTRACTING OFFICER THAT YOU HAD LOCATED A PACKAGING CONTRACTOR WHO WOULD PERFORM THE REQUIRED COATING AND PACKAGING OF THE AIR HEATER TUBES AT A COST OF APPROXIMATELY $60 PER BOX. IN YOUR LETTER OF OCTOBER 3, 1969, TO OUR OFFICE, YOU REQUESTED THAT THE TOTAL CONTRACT PRICE OF THE AIR HEATER TUBES BE INCREASED BY $2,640 TO COVER THE COST OF THE SPECIAL COATING AND BOXING OF THE TUBES.

THE PRIMARY QUESTION FOR CONSIDERATION IS NOT WHETHER AN ERROR WAS MADE IN YOUR BID BUT WHETHER A VALID AND BINDING CONTRACT WAS CONSUMMATED BY ITS ACCEPTANCE. THE CONTRACTING OFFICER HAS REPORTED THAT HE HAD NO REASON TO SUSPECT AN ERROR IN YOUR BID. THE ABSTRACT OF BIDS SHOWS THAT ON BID "B," THE TWO OTHER BIDDERS QUOTED UNIT PRICES OF $2.32 AND $2.503. AT THE TIME OF ACCEPTANCE OF YOUR BID, THE CONTRACTING OFFICER HAD RECEIVED NO NOTICE OR CLAIM OF ERROR, AND WE AGREE WITH THE ADMINISTRATIVE VIEW THAT THE DIFFERENCE BETWEEN YOUR BID AND THE OTHERS RECEIVED WAS NOT SO GREAT AS TO WARRANT THE CONCLUSION THAT HE SHOULD HAVE BEEN ON NOTICE OF THE LIKELIHOOD OF ERROR IN YOUR BID. SO FAR AS THE PRESENT RECORD SHOWS, THE ACCEPTANCE OF YOUR BID AFTER PRICE COMPARISON WITH AN EARLIER PROCUREMENT WAS IN GOOD FAITH, NO ERROR HAVING BEEN ALLEGED BY YOU UNTIL AFTER AWARD. THE ACCEPTANCE OF THE BID, UNDER THE CIRCUMSTANCES INVOLVED, CONSUMMATED A VALID AND BINDING CONTRACT WHICH FIXED THE RIGHTS AND LIABILITIES OF THE PARTIES THERETO.

THE RESPONSIBILITY FOR THE PREPARATION OF THE BID SUBMITTED IN RESPONSE TO THE INVITATION WAS UPON YOU AS THE BIDDER. FRAZIER-DAVIS CONSTRUCTION COMPANY V UNITED STATES, 100 CT. CL. 120, 163 (1943). WHILE IT MAY BE THAT AN ERROR WAS MADE IN THE BID, IT IS CLEAR THAT SUCH ERROR WAS DUE SOLELY TO YOUR OWN OVERSIGHT OR NEGLIGENCE AND WAS IN NO WAY INDUCED OR CONTRIBUTED TO BY THE GOVERNMENT. ANY ERROR THAT WAS MADE IN THE BID WAS UNILATERAL -- NOT MUTUAL -- AND, THEREFORE, DOES NOT ENTITLE YOU TO RELIEF. SEE EDWIN DOUGHERTY AND M. H. OGDEN V UNITED STATES, 102 CT. CL. 249 (1944); SALIGMAN ET AL. V UNITED STATES, 56 F.SUPP. 505 (1944); 20 COMP. GEN. 652 (1941) AND 26 ID. 415 (1946).

ACCORDINGLY, NO LEGAL BASIS EXISTS FOR RELIEVING YOU FROM YOUR OBLIGATION TO FURNISH THE AIR HEATER TUBES AT THE CONTRACT PRICE OR FOR INCREASING THE CONSIDERATION UNDER THE CONTRACT.