B-171449, JAN 21, 1971, 50 COMP GEN 497

B-171449: Jan 21, 1971

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SALES - BIDS - MISTAKES - "APPARENT ON FACE OF BID" REQUIREMENT A BID ON SURPLUS STEEL BARS OFFERING UNIT AND EXTENDED PRICES THAT WERE INCOMPATIBLE WITH THE FOOTAGE SHOWN IN THE SALES INVITATION. WHICH WAS VERIFIED AS INTENDING TO BUY THE STEEL AT THE TOTAL BID PRICE REFLECTED IN THE BID. " SINCE THE ERROR COULD HAVE OCCURRED IN EITHER THE UNIT OR THE BID PRICE. THE MISTAKE IS NOT APPARENT. 1971: FURTHER REFERENCE IS MADE TO YOUR LETTERS OF NOVEMBER 30 AND DECEMBER 10. THE ENTRY "9096 FOOT" WAS SO PLACED UNDER ITEM 80 AS TO CORRESPOND WITH THE PLACEMENT OF THE TERMS "LOT. " "PACKAGE" AND OTHER TERMS DESCRIBING THE UNIT ON WHICH BID PRICES WERE TO BE SUBMITTED. REVIEW OF YOUR BID REVEALED THAT THE UNIT AND EXTENDED PRICES WERE NOT COMPATIBLE WITH THE ADVERTISED QUANTITY OF 9.

B-171449, JAN 21, 1971, 50 COMP GEN 497

SALES - BIDS - MISTAKES - "APPARENT ON FACE OF BID" REQUIREMENT A BID ON SURPLUS STEEL BARS OFFERING UNIT AND EXTENDED PRICES THAT WERE INCOMPATIBLE WITH THE FOOTAGE SHOWN IN THE SALES INVITATION, AND WHICH WAS VERIFIED AS INTENDING TO BUY THE STEEL AT THE TOTAL BID PRICE REFLECTED IN THE BID, THUS MAKING IT THE HIGHEST BID RECEIVED, MAY NOT BE ACCEPTED. WHILE BOTH THE DSAM DISPOSAL MANUAL AND PARAGRAPH 2 406.2 OF THE ARMED SERVICES PROCUREMENT REGULATION AUTHORIZE THE CORRECTION OF A CLERICAL MISTAKE "APPARENT ON THE FACE OF THE BID," SINCE THE ERROR COULD HAVE OCCURRED IN EITHER THE UNIT OR THE BID PRICE, THE MISTAKE IS NOT APPARENT, AS THE INTENDED BID CANNOT BE ASCERTAINED FROM THE BID ITSELF; AND BID CORRECTION, EVEN IF PECUNIARILY ADVANTAGEOUS TO THE GOVERNMENT, WOULD BE HARMFUL TO THE COMPETITIVE SYSTEM.

TO THE SURPLUS TIRE SALES, JANUARY 21, 1971:

FURTHER REFERENCE IS MADE TO YOUR LETTERS OF NOVEMBER 30 AND DECEMBER 10, 1970, CONCERNING YOUR PROTEST AGAINST AWARD TO ANY OTHER BIDDER UNDER ITEM 80, INVITATION FOR BIDS NO. 44-1068, ISSUED BY THE DEFENSE SURPLUS SALES OFFICE, OAKLAND, CALIFORNIA.

THE INVITATION OFFERED FOR SALE 124 ITEMS OF SURPLUS GOVERNMENT PROPERTY, ITEM 80 OF WHICH DESCRIBED AS FOLLOWS:

80. BAR, STEEL, ROUND: CARBON, COLD FINISH, 1" DIAMETER, COMPOSITION AISI NO. C1045. FSN 9510-229-4827. OUTSIDE, AREA F, ROW 25 - IN BUNDLES - UNUSED - FAIR CONDITION. TOTAL COST $3,820 EST. TOTAL WT. 24,286 POUNDS, 9096 FOOT.

THE ENTRY "9096 FOOT" WAS SO PLACED UNDER ITEM 80 AS TO CORRESPOND WITH THE PLACEMENT OF THE TERMS "LOT," "DRUM," "PACKAGE" AND OTHER TERMS DESCRIBING THE UNIT ON WHICH BID PRICES WERE TO BE SUBMITTED.

THE RECORD SHOWS THAT YOU SUBMITTED A UNIT PRICE OF $0.0544 AND A TOTAL PRICE OF $595.72 AS YOUR BID ON THIS ITEM. REVIEW OF YOUR BID REVEALED THAT THE UNIT AND EXTENDED PRICES WERE NOT COMPATIBLE WITH THE ADVERTISED QUANTITY OF 9,096 FEET, SINCE THE STATED UNIT PRICE MULTIPLIED BY 9,096 FEET WOULD RESULT IN A TOTAL BID PRICE OF $494.82. A TELEPHONIC REQUEST TO YOU FOR BID VERIFICATION BROUGHT YOUR ALLEGATION, CONFIRMED BY LETTER OF NOVEMBER 20, 1970, THAT YOUR UNIT BID PRICE WAS INCORRECT, AND THAT THE TOTAL BID PRICE WAS THE CORRECT AND PROPER BID. IF ACCEPTABLE, YOUR TOTAL BID FOR THE ITEM WOULD BE THE HIGHEST RECEIVED, SINCE THE SECOND HIGH BID WAS $534.84 FOR THIS ITEM. EVALUATION OF ALL BIDS RECEIVED ON THE ITEM REVEALED THAT YOUR BID IS WITHIN THE RANGE OF BIDS RECEIVED ON THE BASIS OF EITHER UNIT OR TOTAL PRICE. HOWEVER, IF YOUR UNIT BID PRICE SHOULD BE CORRECTED FROM $0.0544 TO $0.06549, SO AS TO CORRESPOND TO THE TOTAL PRICE BID OF $595.72, IT WOULD DISPLACE ANOTHER BIDDER'S HIGH UNIT PRICE BID OF $0.0588.

BY LETTER OF NOVEMBER 22, 1970, YOU FORWARDED A CHECK IN PAYMENT OF SEVERAL ITEMS AWARDED TO YOU UNDER IFB NO. 44-1068, INCLUDING THEREIN PAYMENT FOR ITEM 80, WITH INSTRUCTIONS THAT THE CHECK BE RETURNED IF AWARD OF ITEM 80 WOULD NOT BE MADE. BY LETTER OF NOVEMBER 30, 1970, ON ADVICE OF COUNSEL, THE SALES CONTRACTING OFFICER INFORMED YOU OF THE "WITHDRAWAL" OF YOUR BID ON ITEM 80 AND RETURNED YOUR CHECK FOR $1,720.41 WITH A REQUEST THAT A CHECK FOR $1,120.91 BE FORWARDED IN PAYMENT FOR ITEMS 78 AND 93 ONLY.

YOUR PROTESTS TO THIS OFFICE FOLLOWED THIS REJECTION OF YOUR BID ON ITEM 80. IN YOUR LETTER OF NOVEMBER 30, 1970, TO THIS OFFICE YOU STATE, VARIOUSLY, THAT ITEM 80 HAS BEEN CONFUSINGLY DESCRIBED IN THAT IT HAS BEEN OFFERED ON A PER FOOT UNIT BASIS; THAT THIS IS NOT THE METHOD OR MANNER BY WHICH STEEL IS EITHER PURCHASED OR SOLD; AND THAT THE CUSTOMARY MANNER BY WHICH STEEL IS AND HAS BEEN SOLD IS BY THE POUND OR TON. YOU STATE FURTHER THAT YOU COMPUTED YOUR BID ON A TONNAGE BASIS, WHICH CAME TO AN AMOUNT OF $595.72, AND THAT IN DIVIDING THIS AMOUNT BY THE FOOTAGE YOU ERRONEOUSLY COMPUTED THE UNIT TO BE 0.0544 PER FOOT. IN YOUR LETTER OF DECEMBER 10, 1970, YOU SUPPLEMENT YOUR PROTEST BY REQUESTING CONSIDERATION OF YOUR BID AS AN APPARENT CLERICAL ERROR, AND ITS ACCEPTANCE UNDER THE RULE PERTAINING TO SUCH ERRORS, CITING DSAM 4160.1, PART 3, CHAPTER X, SECTION A.2 OF THE DISPOSAL MANUAL. YOU HAVE ALSO CITED OUR DECISION B- 162922, DECEMBER 13, 1967, IN SUPPORT OF YOUR PROTEST.

REGARDING YOUR CONTENTION THAT THE ITEM WAS MISDESCRIBED AND THAT IT SHOULD HAVE BEEN OFFERED ON A WEIGHT BASIS, IT IS ADMINISTRATIVELY REPORTED THAT THERE ARE CIRCUMSTANCES WHEN IT WOULD BE APPROPRIATE TO OFFER BAR STEEL BY WEIGHT, AND IT WOULD THEN BE SO OFFERED. FOR EXAMPLE, VARYING LENGTHS OF VARIOUS SIZES OF BAR STEEL ARE OFFERED FOR SALE BY WEIGHT. BAR STEEL OF UNIFORM SIZE AND LENGTH COULD, ON THE OTHER HAND, BE OFFERED FOR SALE BY THE EACH, BY THE FOOT, OR BY WEIGHT, SINCE UNIFORM BAR STOCK CAN BE CONVERTED ACCURATELY FROM FOOTAGE TO WEIGHT AND WEIGHT TO FOOTAGE. WE SEE NO VALID BASIS ON WHICH TO DISAGREE WITH THE ADMINISTRATIVE POSITION ON THIS POINT.

AS A GENERAL RULE, CORRECTION OF AN ERRONEOUS BID WILL NOT BE PERMITTED WHEN TO DO SO WOULD RESULT IN DISPLACEMENT OF THE OSTENSIBLE SUCCESSFUL BIDDER. 37 COMP. GEN. 210 (1957). THE ONLY EXCEPTION TO THIS RULE IS WHERE THE ERROR IS OBVIOUS AND THE INTENDED PRICES CAN BE ASCERTAINED FROM THE BID FORM ITSELF, WITHOUT RESORT TO EXTRANEOUS WORKSHEETS, OR OTHER BID DOCUMENTS. SEE B-169688, MAY 27, 1970; B 157914, JANUARY 28, 1966; AND B- 155537, JANUARY 27, 1965.

YOU ASK WHY THE CONTRACTING OFFICER DID NOT TREAT YOUR BID ON ITEM 80 AS A CLERICAL ERROR AS PROVIDED FOR IN DSAM 4160.1, CONTENDING THAT IT IS APPARENT THAT THE UNIT PRICE YOU ERRONEOUSLY STATED ($0.0544 PER POUND) COULD NOT POSSIBLY HAVE BEEN THE BASIS OF YOUR TOTAL BID OF $595.72 IF THE UNIT OF FEET OFFERED FOR SALE (9,096 FEET) WERE TO BE MULTIPLIED BY THE PRICE YOU OFFERED. ADDITIONALLY, YOU POINT OUT THAT THE AMOUNT OF THE BID DEPOSIT SUBMITTED WITH THIS BID ($286.84) COULD NOT HAVE BEEN ARRIVED AT IF YOU HAD INTENDED TO BID $0.0544 PER POUND.

WHETHER YOUR BID ON ITEM 80 IS CONSIDERED AS HAVING BEEN SUBMITTED ON A TONNAGE (WEIGHT) BASIS OR ON A LINEAR MEASUREMENT (FOOTAGE) BASIS, IT IS STILL INCONSISTENT INASMUCH AS A UNIT BID PRICE OF $0.0544 FOR AN ESTIMATED TONNAGE OF 10.842 GROSS TONS PRODUCES A TOTAL PRICE BID OF ONLY $0.5898. IF CONSIDERED AS A UNIT PRICE BID PER POUND, $0.0544 TIMES THE ESTIMATED TOTAL WEIGHT OF 24,286 POUNDS RESULTS IN A TOTAL PRICE ON THE OTHER EXTREME OF $1,321.16. AND IF CONSIDERED AS A UNIT BID PRICE OF $0.0544 PER FOOT TIMES THE TOTAL FOOTAGE OF 9,096, A TOTAL BID PRICE OF $498.82 RESULTS.

WHILE BOTH THE CITED DISPOSAL MANUAL AND ASPR 2-406.2 AUTHORIZES THE CORRECTION OF A CLERICAL MISTAKE WHICH IS "APPARENT ON THE FACE OF A BID," SUCH A SITUATION IS NOT PRESENT HERE SINCE IT IS NOT APPARENT FROM THE FACE OF THE BID WHETHER THE ERROR OCCURRED IN THE UNIT PRICE OR IN THE EXTENDED PRICE. THE FACT THAT A BID DEPOSIT EQUALS 20 PERCENT OF AN ALLEGED INTENDED BID HAS NEVER BEEN CONSIDERED EXCLUSIVELY IN DETERMINING THAT THE INTENDED BID IS SUBSTANTIALLY ASCERTAINABLE FROM THE INVITATION AND BID ITSELF - THE REASON BEING THAT IF A BIDDER INSERTS A CORRECT UNIT PRICE AND MAKES AN ERROR IN ARRIVING AT THE TOTAL PRICE, THE BID DEPOSIT WOULD NORMALLY REFLECT 20 PERCENT OF THE TOTAL PRICES BID.

THE FACTUAL SITUATION CONSIDERED IN OUR DECISION B-162922, DECEMBER 13, 1967, CITED BY YOU, IS DISTINGUISHABLE FROM THE SITUATION CONSIDERED HEREIN. IN THAT CASE THERE WAS NO ARITHMETICAL BID ERROR APPARENT OR ALLEGED. THE PROTESTING BIDDER HAD SUBMITTED A UNIT PRICE WHICH WHEN EXTENDED ON THE BASIS OFFERED EQUALED THE TOTAL PRICE BID. FURTHER, WHILE THE UNIT BID PRICE THEREIN WAS NOT ON THE PER PIECE BASIS REQUESTED BUT ON A PER POUND BASIS, SUCH FACT WAS CLEARLY SHOWN. WE HELD THAT THE HIGH BID WAS READILY CONVERTIBLE TO A DEFINITE BID PRICE FOR THE ITEMS AND THEREFORE SHOULD HAVE BEEN CONSIDERED FOR THE AWARD. THESE FACTS BEAR NO ANALOGY TO THOSE IN YOUR CASE.

UNDER THE CIRCUMSTANCES, WHILE IT IS OBVIOUS THAT THERE IS A MISTAKE IN EITHER THE UNIT PRICE OR THE EXTENDED PRICE OF YOUR BID, WE MUST CONCLUDE THAT THE INTENDED BID CANNOT BE ASCERTAINED FROM THE BID FORM ITSELF, SINCE THE ERROR COULD HAVE BEEN IN EITHER THE UNIT OR EXTENDED TOTAL PRICE. CORRECTION TO THE EXTENT AND IN THE MANNER REQUESTED BY YOU WOULD THEREFORE CONFER UPON YOU AN UNFAIR COMPETITIVE ADVANTAGE. WHILE YOU MAINTAIN THAT THE BEST INTERESTS OF THE GOVERNMENT WOULD BE SERVED BY ACCEPTANCE OF YOUR HIGHER BID, IT IS OUR VIEW THAT THE HARM TO THE COMPETITIVE BIDDING SYSTEM WOULD FAR OFFSET ANY PECUNIARY ADVANTAGE GAINED THEREBY. AS WE STATED IN B-166748, MAY 14, 1969, REGARDLESS OF THE GOOD FAITH OF THE BIDDER MAKING A MISTAKE, CORRECTION SHOULD BE DENIED IN ANY CASE IN WHICH THERE EXISTS A REASONABLE BASIS FOR ARGUMENT THAT PUBLIC CONFIDENCE IN THE INTEGRITY OF THE COMPETITIVE BIDDING SYSTEM WOULD BE ADVERSELY AFFECTED THEREBY.

ACCORDINGLY, SINCE WE CANNOT DETERMINE FROM THE BID FORM ALONE WHETHER THE ERROR WAS IN THE UNIT PRICE OR EXTENDED TOTAL PRICE, YOUR BID MAY NOT BE CORRECTED, AND YOUR PROTEST AGAINST AWARD TO ANY OTHER BIDDER MUST BE DENIED.