B-174053, OCT 21, 1971

B-174053: Oct 21, 1971

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AMENDMENT MAY BE ALLOWED AS SPECIFICATIONS WERE AMBIGUOUS AS TO THE NUMBER OF BLADE SEALS AND BLADE BOLTS THAT WOULD BE REQUIRED AND AS THE INTERPRETATION GIVEN THE SPECIFICATIONS BY BIDDER WAS REASONABLE. THE CASE IS NOT ONE OF MISTAKE. AS THE BID MADE WAS THE BID INTENDED. SECRETARY: REFERENCE IS MADE TO LETTER DATED AUGUST 31. WHICH WAS DISCLOSED AFTER AWARD. THE SUBJECT CONTRACT WAS NEGOTIATED PURSUANT TO THE AUTHORITY OF 10 U.S.C. 2304(A)(10) FOR THE SOLE SOURCE PROCUREMENT OF REPAIR PARTS FOR THE CONTROLLABLE PITCH PROPELLERS PRESENTLY INSTALLED ON 378' HIGH ENDURANCE CUTTERS. THE CONTRACT WAS AWARDED ON JUNE 30. 920 IT IS REPORTED THAT THE COAST GUARD DRAWING REFERENCED IN ITEM NO. 1 DOES NOT INCLUDE BLADE SEALS AND BLADE BOLTS.

B-174053, OCT 21, 1971

CONTRACTS - AMENDMENT - AMBIGUOUS SPECIFICATIONS DECISION ALLOWING CONTRACT BETWEEN THE U.S. COAST GUARD AND PROPELLERS, INC., FOR REPAIR PARTS FOR THE CONTROLLABLE PITCH PROPELLERS ON 378' HIGH ENDURANCE CUTTERS, TO BE AMENDED. AMENDMENT MAY BE ALLOWED AS SPECIFICATIONS WERE AMBIGUOUS AS TO THE NUMBER OF BLADE SEALS AND BLADE BOLTS THAT WOULD BE REQUIRED AND AS THE INTERPRETATION GIVEN THE SPECIFICATIONS BY BIDDER WAS REASONABLE. THE CASE IS NOT ONE OF MISTAKE, AS THE BID MADE WAS THE BID INTENDED.

TO MR. SECRETARY:

REFERENCE IS MADE TO LETTER DATED AUGUST 31, 1971, FROM E. D. SCHEIDERER, REAR ADMIRAL, U.S. COAST GUARD, COMPTROLLER, RECOMMENDING THAT CONTRACT DOT-CG-13944-A BE INCREASED IN THE AMOUNT OF $5,205.20, BECAUSE OF A MISTAKE BY THE CONTRACTOR, PROPELLERS, INC., 77 RIVER STREET, HOBOKEN, NEW JERSEY, WHICH WAS DISCLOSED AFTER AWARD.

THE SUBJECT CONTRACT WAS NEGOTIATED PURSUANT TO THE AUTHORITY OF 10 U.S.C. 2304(A)(10) FOR THE SOLE SOURCE PROCUREMENT OF REPAIR PARTS FOR THE CONTROLLABLE PITCH PROPELLERS PRESENTLY INSTALLED ON 378' HIGH ENDURANCE CUTTERS. THE CONTRACT WAS AWARDED ON JUNE 30, 1971, FOR $78,965.20, AS FOLLOWS:

ITEM

NO. SUPPLIES QUANTITY UNIT PRICE AMOUNT

1. PROPELLER BLADE, RIGHT HAND,

WITH BLADE SEALS AND BLADE

BOLTS IN ACCORDANCE WITH COAST

GUARD DRAWING #719 WPG

4400-65 (ESCHER WYSS DRAWING

#8-344-711-00 4 $9,220.00 $36,880

2. PROPELLER BLADE, SAME AS

ITEM 1 ABOVE EXCEPT LEFT

HAND, WITH BLADE SEALS AND

BLADE BOLTS 4 $9,220.00 $36,880

3. BLADE SEALS (2 HUB SETS, FOR

ITEMS 1 AND 2 ABOVE 8 $ 35.65 $ 285

4. BLADE BOLTS (FOR ITEMS 1 AND

2 ABOVE) 48 $ 102.50 $ 4,920

IT IS REPORTED THAT THE COAST GUARD DRAWING REFERENCED IN ITEM NO. 1 DOES NOT INCLUDE BLADE SEALS AND BLADE BOLTS.

ON JULY 12, 1971, PROPELLERS, INC., ADVISED THE CONTRACTING OFFICER THAT IF BLADE SEALS AND BLADE BOLTS WERE REQUIRED AS PART OF ITEMS 1 AND 2, IN ADDITION TO BEING SUPPLIED AS ITEMS 3 AND 4, IT HAD MADE A MISTAKE IN THE CONTRACT PRICE, SINCE ITS PRICES UNDER ITEMS 1 AND 2 FOR THE PROPELLER BLADES DID NOT INCLUDE THE PRICE OF BLADE SEALS AND BLADE BOLTS. RESPONSE THERETO, THE CONTRACTING OFFICER INFORMED THE CONTRACTOR THAT APPROPRIATE SEALS AND BOLTS WERE REQUIRED TO BE FURNISHED UNDER ITEMS 1 AND 2 BY THE CONTRACT PROVISIONS. PROPELLERS IS SUPPLYING, IN ADDITION TO ITEMS 3 AND 4, 8 BLADE SEALS AND 48 BLADE BOLTS AS A PART OF ITEMS 1 AND 2, AND REQUESTS THAT THE CONTRACT PRICE BE INCREASED BY $5,205.20.

THE RECORD EVIDENCES THAT BLADE SEALS AND BLADE BOLTS WERE NOT INCLUDED IN PROPELLERS' PRICE FOR ITEMS 1 AND 2 NOR IS THERE ANY EVIDENCE TO SUPPORT A FINDING THAT THE CONTRACTOR HAD INTENDED TO INCLUDE THE ADDITIONAL SEALS AND BOLTS AS PART OF ITS OFFER OR THAT IT UNDERSTOOD THE SPECIFICATIONS AS REQUIRING THEM. THEREFORE, IT IS OUR VIEW THAT THE CONTRACTOR SHOULD NOT BE CONSIDERED AS HAVING MADE A MISTAKE BECAUSE, BASED ON ITS INTERPRETATION OF THE CONTRACT PROVISIONS, IT OFFERED THE EXACT PRICE WHICH IT INTENDED TO OFFER. RATHER THAN A MISTAKE, WE BELIEVE THE CASE INVOLVES A MATTER OF AMBIGUOUS CONTRACT REQUIREMENTS.

IN OUR OPINION, THE TERMS OF THE CONTRACT CONCERNING THE QUANTITY OF BLADE SEALS AND BLADE BOLTS TO BE FURNISHED ARE UNCERTAIN, AND THE AMBIGUITY SHOULD BE REGARDED AS THE RESULT OF SUBTLE, NOT BLATANT DISCREPANCIES. ITEMS 1 AND 2 OF THE CONTRACT DOES NOT INDICATE ANY SPECIFIC NUMBER OF SEALS AND BOLTS, AND REQUIRES PROPELLER BLADES "WITH BLADE SEALS AND BLADE BOLTS IN ACCORDANCE WITH COAST GUARD DRAWING *** ." THE DRAWING REFERENCED AS A DESCRIPTION OF WHAT MUST BE FURNISHED UNDER ITEMS 1 AND 2 DOES NOT INCLUDE EITHER BLADE SEALS OR BLADE BOLTS. FURTHER, THE BLADE SEALS AND BLADE BOLTS REQUIRED BY ITEMS 3 AND 4 ARE NOT DESIGNATED AS EXTRA PARTS BUT ARE SPECIFIED AS BEING "FOR ITEMS 1 AND 2" WHICH ITEMS, AS NOTED ABOVE, ARE DEPICTED IN THE DRAWING AS BEING WITHOUT SEALS AND BOLTS. IN ADDITION, ITEMS 3 AND 4 CONTAIN THE PROPER NUMBER OF SEALS AND BOLTS NEEDED TO INSTALL THE PROPELLER BLADES SET FORTH AS ITEMS 1 AND 2.

WHERE IT IS DETERMINED THAT AN AMBIGUITY IN THE SOLICITATION WAS NOT PATENT, A DETERMINATION THAT THE CONTRACTOR'S INTERPRETATION OF THE AMBIGUOUS PROVISIONS WAS REASONABLE WILL SERVE AS A BASIS FOR PERFORMANCE IN ACCORDANCE WITH THE CONTRACTOR'S UNDERSTANDING OF THE INTENT OF THE CONTRACT. SEE MOUNTAIN HOME CONTRACTORS V UNITED STATES, 425 F.2D 1260 (1970). THE COURT OF CLAIMS HAS ALSO STATED THE RULE:

" *** IF SOME SUBSTANTIVE PROVISION OF A GOVERNMENT-DRAWN AGREEMENT IS FAIRLY SUSCEPTIBLE OF A CERTAIN CONSTRUCTION AND THE CONTRACTOR ACTUALLY AND REASONABLY SO CONSTRUES IT, IN THE COURSE OF BIDDING OR PERFORMANCE, THAT IS THE INTERPRETATION WHICH WILL BE ADOPTED - UNLESS THE PARTIES' INTENTION IS OTHERWISE AFFIRMATIVELY REVEALED." WPC ENTERPRISES, INC. V UNITED STATES, 323 F.2D 874, 876 (1963).

WE HAVE HELD THAT IN DETERMINING WHETHER AN INTERPRETATION OF A CONTRACT IS REASONABLE ITS INTENT AND MEANING ARE NOT TO BE DETERMINED BY THE CONSIDERATION OF AN ISOLATED SECTION OR PROVISION THEREOF, BUT THAT THE CONTRACT IS TO BE CONSIDERED IN ITS ENTIRETY AND EACH PROVISION IS TO BE CONSTRUED IN ITS RELATION TO OTHER PROVISIONS AND IN THE LIGHT OF THE GENERAL PURPOSES INTENDED TO BE ACCOMPLISHED BY THE CONTRACTING PARTIES. B-156602, MAY 17, 1965.

IN VIEW OF THE FOREGOING, WE BELIEVE THAT THE CONTRACT MAY REASONABLY BE REGARDED AS REQUIRING THE CONTRACTOR TO FURNISH ONLY 8 BLADE SEALS AND 48 BLADE BOLTS, AND THE CONTRACT MAY THEREFORE BE AMENDED TO PROVIDE PAYMENT FOR THE ADDITIONAL SEALS AND BOLTS, AS ADMINISTRATIVELY RECOMMENDED.