B-180386, FEB 4, 1974

B-180386: Feb 4, 1974

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CONTRACTOR WHO ALLEGED MISTAKE IN LUMP SUM BID PRICE RESULTING FROM SUPPLIER NEGLECTING TO INCLUDE COST OF CERTAIN REQUIREMENTS IN PRICE QUOTATION TO CONTRACTOR MAY NOT HAVE BID PRICE CORRECTED BECAUSE IT WOULD. BE RECALCULATION OF BID TO INCLUDE FACTORS THAT HAD NOT BEEN CONSIDERED WHEN QUOTATION WAS PREPARED. SINCE CONTRACTING OFFICER SHOULD HAVE BEEN ON CONSTRUCTIVE NOTICE OF ERROR AND REQUESTED VERIFICATION INASMUCH AS $2. 804 BID PRICE WAS 25 PERCENT LESS THAN NEXT LOW BID AND THREE BIDS ABOVE LOW BID WERE SEPARATED BY ONLY $214. THE THREE OTHER BIDS RECEIVED WERE $3. PURCHASE ORDER NO. 4899 WAS ISSUED TO NATIONAL ON JUNE 28. WHERE A MISTAKE IN BID IS ALLEGED AFTER AWARD OF A CONTRACT.

B-180386, FEB 4, 1974

CONTRACTOR WHO ALLEGED MISTAKE IN LUMP SUM BID PRICE RESULTING FROM SUPPLIER NEGLECTING TO INCLUDE COST OF CERTAIN REQUIREMENTS IN PRICE QUOTATION TO CONTRACTOR MAY NOT HAVE BID PRICE CORRECTED BECAUSE IT WOULD, IN EFFECT, BE RECALCULATION OF BID TO INCLUDE FACTORS THAT HAD NOT BEEN CONSIDERED WHEN QUOTATION WAS PREPARED; HOWEVER, CONTRACT MAY BE RESCINDED WITHOUT LIABILITY TO CONTRACTOR, SINCE CONTRACTING OFFICER SHOULD HAVE BEEN ON CONSTRUCTIVE NOTICE OF ERROR AND REQUESTED VERIFICATION INASMUCH AS $2,804 BID PRICE WAS 25 PERCENT LESS THAN NEXT LOW BID AND THREE BIDS ABOVE LOW BID WERE SEPARATED BY ONLY $214. SEE DECISIONS CITED.

TO NATIONAL CHINA & EQUIPMENT CORP.:

THE VETERANS ADMINISTRATION ISSUED SOLICITATION NO. 73-49 FOR ONE ELECTRIC FOOD MIXING MACHINE IN COMPLIANCE WITH FEDERAL SPECIFICATION 00-M -38G. NATIONAL CHINA AND EQUIPMENT COMPANY (NATIONAL) SUBMITTED A LOW LUMP SUM BID IN THE AMOUNT OF $2,804.80. THE THREE OTHER BIDS RECEIVED WERE $3,522.50, $3,575.00, AND $3,736.00. PURCHASE ORDER NO. 4899 WAS ISSUED TO NATIONAL ON JUNE 28, 1973. ON AUGUST 10, 1973, NATIONAL NOTIFIED THE CONTRACTING OFFICER THAT AN ERROR HAD BEEN MADE IN ITS BID AND REQUESTED EITHER AN INCREASE IN THE CONTRACT PRICE OR CANCELLATION OF THE CONTRACT.

EVIDENCE HAS BEEN PRESENTED THAT THE ERROR OCCURRED IN THE QUOTATION WHICH NATIONAL RECEIVED FROM ITS SUPPLIER. IN PREPARING THE QUOTATION, THE SUPPLIER NEGLECTED TO INCLUDE THE COST OF A POWER BOWL LIFT, BOWL LIGHT, TIMER AND AN ELECTROMAGNETIC COMPATABILITY TEST.

WHERE A MISTAKE IN BID IS ALLEGED AFTER AWARD OF A CONTRACT, OUR OFFICE WILL GRANT RELIEF ONLY IF THE MISTAKE IS MUTUAL OR THE CONTRACTING OFFICER WAS ON ACTUAL OR CONSTRUCTIVE NOTICE OF THE ERROR PRIOR TO AWARD. COMP. GEN. 672 (1969) AND B-178706, JUNE 15, 1973.

IN THE REPORT TO OUR OFFICE, THE CONTRACTING OFFICER STATED THAT THE DISCREPANCY BETWEEN THE LOW BID AND THE OTHER BIDS RECEIVED SHOULD HAVE ALERTED HIM TO THE POSSIBILITY OF ERROR AND HE SHOULD HAVE REQUESTED VERIFICATION OF NATIONAL'S BID PRICE. WE AGREE. SINCE THE NATIONAL BID WAS APPROXIMATELY 25 PERCENT LESS THAN THE NEXT LOW BID AND THE THREE BIDS ABOVE THE LOW BID WERE SEPARATED BY ONLY $214, THE CONTRACTING OFFICER WAS ON CONSTRUCTIVE NOTICE OF THE POSSIBILITY OF ERROR AND SHOULD HAVE REQUESTED VERIFICATION.

TO ALLOW CORRECTION OF THE BID WOULD BE, IN EFFECT, ALLOWING RECALCULATION OF THE BID TO INCLUDE FACTORS THAT HAD NOT BEEN CONSIDERED WHEN THE QUOTATION ON THE EQUIPMENT, WAS PREPARED. THEREFORE, CORRECTION OF THE MISTAKE CANNOT BE ALLOWED. B-177330, JANUARY 2, 1973; 37 COMP. GEN. 706 (1958). HOWEVER, SINCE NO DELIVERY HAS BEEN MADE, THE CONTRACT MAY BE RESCINDED WITHOUT LIABILITY TO NATIONAL.