B-173666, OCT 1, 1971

B-173666: Oct 1, 1971

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WHERE THE IFB INCLUDES THE PROVISION THAT THE GOVERNMENT MAY ACCEPT LESS THAN THE TOTAL QUANTITY SOLICITED AND PROTESTANT'S LOW UNIT BID PRICE OF $69.70 WAS CONFIRMED PRIOR TO AWARD. THERE IS NO LEGAL BASIS FOR GRANTING AN ADJUSTMENT SINCE PROTESTANT'S BID DID NOT PRECLUDE AWARD OF A LESSER QUANTITY. TO AIRCRAFT ENGINEERING CORPORATION: REFERENCE IS MADE TO YOUR LETTER OF JULY 19. INVITATION FOR BIDS F04606-70 -B-0093 WAS ISSUED FOR 176 TRAILING EDGES FOR CERTAIN AIRCRAFT. YOUR COMPANY WAS THE LOW RESPONSIVE BIDDER WITH A UNIT PRICE BID OF $69.70. YOUR COMPANY WAS ASKED TO CONFIRM ITS BID PRICE WHICH IT DID BY TELETYPE ON OCTOBER 1. IT IS FURTHER REPORTED THAT ON OCTOBER 16. A CONTRACT FOR THE REDUCED REQUIREMENT OF 72 UNITS WAS AWARDED TO YOU ON NOVEMBER 6.

B-173666, OCT 1, 1971

BID PROTEST - MISTAKE IN BID - CONTRACT ADJUSTMENT BY SUCCESSFUL LOW BIDDER DECISION DENYING REQUEST FOR A CONTRACT ADJUSTMENT INCIDENT TO A CONTRACT AWARDED BY THE SACRAMENTO AIR MATERIEL AREA, MCCLELLAN AFB, FOR 176 TRAILING EDGES FOR CERTAIN AIRCRAFT. WHERE THE IFB INCLUDES THE PROVISION THAT THE GOVERNMENT MAY ACCEPT LESS THAN THE TOTAL QUANTITY SOLICITED AND PROTESTANT'S LOW UNIT BID PRICE OF $69.70 WAS CONFIRMED PRIOR TO AWARD, THERE IS NO LEGAL BASIS FOR GRANTING AN ADJUSTMENT SINCE PROTESTANT'S BID DID NOT PRECLUDE AWARD OF A LESSER QUANTITY.

TO AIRCRAFT ENGINEERING CORPORATION:

REFERENCE IS MADE TO YOUR LETTER OF JULY 19, 1971, WITH ENCLOSURES, REQUESTING OUR OFFICE TO REVIEW THE DENIAL OF YOUR CLAIM PURSUANT TO PUBLIC LAW 85-804 FOR A CONTRACT ADJUSTMENT UNDER CONTRACT F04606-70-C 0402, ISSUED BY THE SACRAMENTO AIR MATERIEL AREA, MCCLELLAN AIR FORCE BASE, CALIFORNIA.

THE RECORD SHOWS THAT ON SEPTEMBER 2, 1969, INVITATION FOR BIDS F04606-70 -B-0093 WAS ISSUED FOR 176 TRAILING EDGES FOR CERTAIN AIRCRAFT. THE IFB INCLUDED UNDER "SOLICITATION INSTRUCTIONS AND CONDITIONS," PARAGRAPH 10(C) THE FOLLOWING:

"(C) THE GOVERNMENT MAY ACCEPT ANY ITEM OR GROUP OF ITEMS OF ANY OFFER, UNLESS THE OFFEROR QUALIFIES HIS OFFER BY SPECIFIC LIMITATIONS. UNLESS OTHERWISE PROVIDED IN THE SCHEDULE, OFFERS MAY BE SUBMITTED FOR ANY QUANTITIES LESS THAN THOSE SPECIFIED; AND THE GOVERNMENT RESERVES THE RIGHT TO MAKE AN AWARD ON ANY ITEM FOR A QUANTITY LESS THAN THE QUANTITY OFFERED AT THE UNIT PRICES OFFERED UNLESS THE OFFEROR SPECIFIES OTHERWISE IN HIS OFFER."

THE RECORD FURTHER SHOWS THAT FIVE SOURCES RESPONDED TO THE IFB BY THE SCHEDULED BID OPENING DATE OF SEPTEMBER 29, 1969. YOUR COMPANY WAS THE LOW RESPONSIVE BIDDER WITH A UNIT PRICE BID OF $69.70. OTHER BIDS RANGED FROM $88.93 TO $119.00. YOUR COMPANY WAS ASKED TO CONFIRM ITS BID PRICE WHICH IT DID BY TELETYPE ON OCTOBER 1, 1969. IT IS FURTHER REPORTED THAT ON OCTOBER 16, 1969, THE BUYER RECEIVED AN AMENDED PURCHASE REQUEST REDUCING THE ORIGINAL REQUIREMENT FROM 176 UNITS TO 72 UNITS. SINCE YOUR BID DID NOT PRECLUDE AWARD OF THE LESSER QUANTITY, A CONTRACT FOR THE REDUCED REQUIREMENT OF 72 UNITS WAS AWARDED TO YOU ON NOVEMBER 6, 1969, IN ACCORDANCE WITH THE QUOTED PROVISION OF THE IFB.

BY LETTER DATED DECEMBER 1, 1969, YOU ALLEGED THAT YOU HAD MADE A MISTAKE IN YOUR BID IN NOT PROVIDING FOR A HIGHER UNIT PRICE FOR AWARD OF LESS THAN THE TOTAL QUANTITY IN THE IFB. YOU ENCLOSED A WORKSHEET SHOWING THAT UNDER THE LESSER REQUIREMENTS YOUR UNIT PRICE SHOULD HAVE BEEN $79.78, AND YOU REQUESTED THAT YOUR BID BE PROCESSED UNDER ASPR 2 406.4. SUBSEQUENTLY, BY LETTER DATED JANUARY 16, 1970, YOU STATED AS FOLLOWS:

A. "THE ERROR OCCURRED THROUGH AEC'S FAILURE TO INDICATE THAT THE UNIT PRICING QUOTED WAS APPLICABLE ONLY TO THE 176 UNITS ORIGINALLY CITED.

B. "THE 'INTENDED' OR PROPER BID WOULD HAVE BEEN $79.78/UNIT AS NOTED ON OUR EARLIER LETTER OF DECEMBER 1, 1969.

C. "WE AGREE THAT ' ... NO CONTRACTOR WOULD HAVE HAD REASON TO ESTIMATE A PRICE FOR A QUANTITY OF 72 ... .' HOWEVER EVERY BIDDER (INCLUDING AEC) SHOULD HAVE ALLOWED FOR A POSSIBLE QUANTITY REDUCTION BY STATING THAT PRICING BID WAS ONLY FOR THE 176 UNIT QUANTITY. IN THIS REGARD, AEC'S WORKSHEET SHOWING AN ESTIMATE FOR THE 72 UNIT QUANTITY IS CERTAINLY 'AFTER THE FACT INFORMATION.'"

BY LETTER DATED MAY 22, 1970, THE CONTRACTING OFFICER FURNISHED YOU A MEMORANDUM OF DECISION DATED MAY 21, 1970, WHICH STATES IN PART AS FOLLOWS:

" *** FOR A MISTAKE TO BE CORRECTABLE, EVIDENCE MUST BE SHOWN THAT A MISTAKE IN FACT DOES EXIST, AND IT MUST BE SHOWN THAT THE ALLEGED MISTAKE WAS INDUCED OR CONTRIBUTED TO BY THE GOVERNMENT. FROM THE FACTS PRESENTED IN THIS CASE THERE IS NO EVIDENCE INDICATING THAT THE CONTRACTING OFFICER WAS ON NOTICE OR SHOULD HAVE BEEN ON NOTICE OF ANY ERROR IN PRICE BEFORE AWARDING THE CONTRACT."

THE RECORD ESTABLISHES THAT THE ACCEPTANCE, AFTER CONFIRMATION, OF YOUR BID WAS IN GOOD FAITH - NO ERRORS HAVING BEEN ALLEGED UNTIL AFTER AWARD - AND UNDER THE CIRCUMSTANCES CONSUMMATED A VALID AND BINDING CONTRACT WHICH FIXED THE RIGHTS AND LIABILITIES OF THE PARTIES.

YOU CITE OUR DECISION, B-170808, MAY 14, 1971, IN SUPPORT OF YOUR REQUEST FOR RELIEF. WE BELIEVE THAT THE FACTS IN THAT CASE ARE DISTINGUISHABLE. THE DECISION IN THE EARLIER CASE WAS BASED ON THE FACT THAT THE CONTRACTING OFFICER KNEW, OR SHOULD HAVE KNOWN, PRIOR TO BID OPENING, THAT THE REQUIREMENT HAD BEEN REDUCED BY SOME 38 PERCENT, YET HE FAILED TO COMPLY WITH THE REQUIREMENT OF ASPR 2-208 THAT SUCH CHANGE BE ACCOMPLISHED BY AMENDMENT TO THE INVITATION. IN THE INSTANT CASE, THE RECORD SHOWS THAT THE CONTRACTING OFFICER HAD NO KNOWLEDGE OF THE REDUCED QUANTITY UNTIL OCTOBER 16, 1969, SOME 18 DAYS AFTER BID OPENING. THERE IS NO INDICATION OF ANY FAILURE BY THE CONTRACTING OFFICER TO COMPLY WITH THE REQUIREMENTS OF LAW AND REGULATION. THE AWARD OF LESS THAN THE FULL QUANTITY IN THE CIRCUMSTANCES IS ENTIRELY PROPER AND CONSISTENT WITH THE QUOTED IFB PROVISION.

WHEN A MISTAKE IS ALLEGED AFTER AWARD OF A CONTRACT, OUR OFFICE WILL GRANT RELIEF ONLY IF THE MISTAKE WAS MUTUAL OR THE CONTRACTING OFFICER WAS ON ACTUAL OR CONSTRUCTIVE NOTICE OF THE ERROR PRIOR TO AWARD. THIS IS A WELL ESTABLISHED PRINCIPLE OF CONTRACT LAW AND IS EQUALLY APPLICABLE TO PRIVATE AND PUBLIC CONTRACTS. B-163970, MAY 7, 1968; B 156542, JUNE 1, 1965; B-141294, DECEMBER 8, 1959; SEE ALSO 30 COMP. GEN. 509 (1951).

ACCORDINGLY, THERE IS NO LEGAL BASIS FOR GRANTING THE REQUESTED RELIEF.