B-182333, NOV 26, 1974

B-182333: Nov 26, 1974

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WHERE HIGH BID WAS APPROXIMATELY EIGHT AND A HALF TIMES CURRENT MARKET APPRAISAL. SINCE CONTRACTING OFFICER WAS ON CONSTRUCTIVE NOTICE OF MISTAKE AND VERIFICATION SHOULD HAVE BEEN REQUESTED BEFORE AWARD WAS ACCOMPLISHED. BE RESCINDED ON THE GROUND THAT THE CONTRACTING OFFICER SHOULD HAVE BEEN ON NOTICE OF AN ERROR IN THE MARITIME BID. WE AGREE THAT THE CONTRACTING OFFICER WAS ON CONSTRUCTIVE NOTICE OF ERROR AND THAT VERIFICATION SHOULD HAVE BEEN REQUIESED BEFORE AWARD WAS ACCOMPLISHED. THE BASIS FOR THIS CONCLUSION IS THAT THE MARITIME BID WAS APPROXIMATELY EIGHT AND A HALF TIMES THE CURRENT MARKET APPRAISAL.

B-182333, NOV 26, 1974

WHERE HIGH BID WAS APPROXIMATELY EIGHT AND A HALF TIMES CURRENT MARKET APPRAISAL, SIX TIMES PRICE FOR SAME ITEM IN PREVIOUSLY DEFAULTED CONTRACT BY ANOTHER CONTRACTOR AND FOUR TIMES NEXT HIGH BID, SALES CONTRACT MAY BE RESCINDED, SINCE CONTRACTING OFFICER WAS ON CONSTRUCTIVE NOTICE OF MISTAKE AND VERIFICATION SHOULD HAVE BEEN REQUESTED BEFORE AWARD WAS ACCOMPLISHED.

MARITIME SHIPPING CO., LTD.:

BY LETTER OF OCTOBER 1, 1974, THE ACTING ASSISTANT COUNSEL, DEFENSE SUPPLY AGENCY, RECOMMENDED THAT SALES CONTRACT NO. 16-5004-104, AWARDED TO THE MARITIME SHIPPING CO., LTD. (MARITIME), ON ITEM 1 OF SALE NO. 16 5004, BE RESCINDED ON THE GROUND THAT THE CONTRACTING OFFICER SHOULD HAVE BEEN ON NOTICE OF AN ERROR IN THE MARITIME BID.

UPON REVIEW OF THE INFORMATION CONTAINED IN THE ADMINISTRATIVE FILE PERTAINING TO THIS CASE, WE AGREE THAT THE CONTRACTING OFFICER WAS ON CONSTRUCTIVE NOTICE OF ERROR AND THAT VERIFICATION SHOULD HAVE BEEN REQUIESED BEFORE AWARD WAS ACCOMPLISHED. THE BASIS FOR THIS CONCLUSION IS THAT THE MARITIME BID WAS APPROXIMATELY EIGHT AND A HALF TIMES THE CURRENT MARKET APPRAISAL, SIX TIMES THE PRICE FOR THE SAME ITEM IN A PREVIOUSLY DEFAULTED CONTRACT BY ANOTHER CONTRACTOR AND FOUR TIMES THE NEXT HIGH BID. SEE B-176800, SEPTEMBER 21, 1972. ACCORDINGLY, THE SALES CONTRACT MAY BE RESCINDED FOR ITEM 1, AS RECOMMENDED.