B-169810, JUL. 8, 1970

B-169810: Jul 8, 1970

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CONTRACTOR WHO AFTER AWARD OF LUMP-SUM CONSTRUCTION CONTRACT WHICH HAD BEEN REVISED AND REDUCED WAS NOTIFIED OF ERROR BY SUBCONTRACTOR MAY NOT BE GRANTED RELIEF SINCE ALTHOUGH EVIDENCE SUBSTANTIATES ERROR. CONTRACTOR & CONTRACTING OFFEROR WERE NOT ON NOTICE OF ERROR AND ACCEPTANCE OF OFFER CONSUMMATED A VALID & BINDING CONTRACT. CONTRACT DOT-FA70S0-5319 WAS ENTERED INTO WITH COLLINS & COMPANY. THE CONTRACT WAS AMENDED BY MODIFICATION NO. 2. HAD MADE A MISTAKE IN PREPARING ITS QUOTATION TO COLLINS WHICH WAS USED IN NEGOTIATING MODIFICATION NO. 2. THE TOTAL AMOUNT OF THE RELIEF SOUGHT IS $5. B. LEE PLUMBING & HEATING COMPANY MADE A NEW ESTIMATE FOR THE ENTIRE JOB AND THAT ITS QUOTATION FOR THE REVISED WORK WAS THEN COMPUTED BY TAKING THE DIFFERENCE BETWEEN THE ORIGINAL ESTIMATE AND THE REVISED (NEW) ESTIMATE.

B-169810, JUL. 8, 1970

CONTRACT -- MISTAKE -- SUBCONTRACTOR ERROR DECISION TO COLLINS & COMPANY, GENERAL CONTRACTORS, INC. PRIME CONTRACTOR DENYING RELIEF ON ACCOUNT OF ERROR BY SUBCONTRACTOR UNDER CONTRACT WITH FEDERAL AVIATION ADMIN. CONTRACTOR WHO AFTER AWARD OF LUMP-SUM CONSTRUCTION CONTRACT WHICH HAD BEEN REVISED AND REDUCED WAS NOTIFIED OF ERROR BY SUBCONTRACTOR MAY NOT BE GRANTED RELIEF SINCE ALTHOUGH EVIDENCE SUBSTANTIATES ERROR, CONTRACTOR & CONTRACTING OFFEROR WERE NOT ON NOTICE OF ERROR AND ACCEPTANCE OF OFFER CONSUMMATED A VALID & BINDING CONTRACT.

TO MR. SHAFFER:

WE REFER TO A LETTER OF MAY 12, 1970, FROM THE DIRECTOR, LOGISTICS SERVICE, FEDERAL AVIATION ADMINISTRATION, REQUESTING A DECISION AS TO WHETHER AN ALLEGED MISTAKE IN A CONTRACT MODIFICATION MAY BE CORRECTED.

CONTRACT DOT-FA70S0-5319 WAS ENTERED INTO WITH COLLINS & COMPANY, GENERAL CONTRACTORS, INCORPORATED (COLLINS), ON OCTOBER 15, 1969, AND PROVIDED FOR THE CONSTRUCTION OF AN AUTOMATION WING AT THE ATLANTA AIR ROUTE TRAFFIC CONTROL CENTER, HAMPTON, GEORGIA. ON DECEMBER 24, 1969, AFTER NEGOTIATIONS BETWEEN THE PARTIES, THE CONTRACT WAS AMENDED BY MODIFICATION NO. 2. ON JANUARY 5, 1970, COLLINS ADVISED THE CONTRACTING OFFICER THAT ITS SUBCONTRACTOR, A. B. LEE PLUMBING & HEATING COMPANY, HAD MADE A MISTAKE IN PREPARING ITS QUOTATION TO COLLINS WHICH WAS USED IN NEGOTIATING MODIFICATION NO. 2. THE TOTAL AMOUNT OF THE RELIEF SOUGHT IS $5,801.95.

IN A LETTER OF JANUARY 22, 1970, COLLINS STATED THAT IN ORDER TO ARRIVE AT A QUOTATION FOR THE REVISED MECHANICAL SYSTEM A. B. LEE PLUMBING & HEATING COMPANY MADE A NEW ESTIMATE FOR THE ENTIRE JOB AND THAT ITS QUOTATION FOR THE REVISED WORK WAS THEN COMPUTED BY TAKING THE DIFFERENCE BETWEEN THE ORIGINAL ESTIMATE AND THE REVISED (NEW) ESTIMATE. HOWEVER, IN CHECKING THE WORK, THE SUBCONTRACTOR DISCOVERED THAT THE ORIGINAL ESTIMATE FOR THE DUCT WORK WAS ENTERED IN ERROR ON ITS COMPUTATION SHEET AND, THUS, IN ITS QUOTATION TO COLLINS. IN EFFECT, THE SUBCONTRACTOR CLAIMED THAT IT SHOULD HAVE QUOTED A PRICE OF $5,801.95 HIGHER THAN IT DID.

THE CONTRACTING OFFICER REPORTS THAT THE EVIDENCE SUBMITTED BY THE SUBCONTRACTOR ESTABLISHES THAT AN ERROR WAS MADE BY THE SUBCONTRACTOR IN PREPARING HIS TYPED QUOTATION FOR SUBMISSION TO COLLINS AND THAT THIS ERROR WAS PASSED ON TO THE PRIME CONTRACTOR WHO SUBMITTED A LUMP SUM QUOTATION FOR THE WORK REQUIRED IN MODIFICATION NO. 2. HOWEVER, HE STATES THAT HE WAS NOT ON CONSTRUCTIVE NOTICE OF THE MISTAKE BEFORE AWARD NOTING THAT THE PROPOSAL BY COLLINS ON MODIFICATION NO. 2 WAS A LUMP-SUM BID OF $62,027 WHICH WAS REVISED TO A FIGURE OF $53,190 AND FINALLY REDUCED TO A LUMP-SUM FIGURE OF $37,620.86. THE CONTRACTING OFFICER FURTHER REPORTS THAT DURING THE NEGOTIATION CONFERENCE ON MODIFICATION NO. 2 WITH COLLINS THERE WAS NO DISCUSSION THAT WOULD HAVE INDICATED OR REVEALED THAT THE SUBCONTRACTOR HAD MADE A MISTAKE. HE, THEREFORE, RECOMMENDS AGAINST THE RELIEF REQUESTED.

IN CASES INVOLVING MISTAKES IN BIDS OR PROPOSALS ALLEGED AFTER AWARD, AS IN THIS CASE, RELIEF CAN BE GRANTED ONLY IF THE MISTAKE WAS MUTUAL OR THE CONTRACTING OFFICER WAS ON ACTUAL OR CONSTRUCTIVE NOTICE OF THE ERROR PRIOR TO AWARD. B-163970, MAY 7, 1968, AND DECISIONS CITED THEREIN. THE CIRCUMSTANCES IN THIS CASE DO NOT WARRANT A FINDING THAT THE CONTRACTING OFFICER WAS ON ACTUAL OR CONSTRUCTIVE NOTICE OF THE ERROR PRIOR TO AWARD OR CONSUMMATION OF MODIFICATION NO. 2. THE ACCEPTANCE OF THE CONTRACTOR'S OFFER BY THE GOVERNMENT WITHOUT ACTUAL OR CONSTRUCTIVE NOTICE OF ERROR CONSUMMATED A VALID AND BINDING CONTRACT WHICH FIXED THE RIGHTS OF THE PARTIES. SEE OGDEN AND DOUGHERTY V UNITED STATES, 102 CT. CL. 245 (1944), AND SALIGMAN ET AL. V UNITED STATES, 56 F. SUPP. 505 (1944).

WE SEE NO LEGAL BASIS FOR CORRECTION OF MODIFICATION NO. 2 OR FOR THE PAYMENT OF ANY AMOUNT IN EXCESS OF THAT STATED IN THE MODIFICATION.