Protest of Army Contract Award

B-196369: Mar 6, 1980

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A firm protested the award of an Army contract alleging that the award was improper. The solicitation included a modified set of drawings which required the substitution of forgings, rather than castings, for fabrication. The protester complained that the awardee's bid was made on the basis of castings instead of forgings. After noting a significant difference between the two lowest bids and the remaining bids, the Army asked the two lowest bidders to verify their bids. In admitting its mistake, the awardee stated that it would have bid a higher unit price if it had realized the forging requirement. The awardee then determined that it could economically manufacture the item at the bid price despite the additional forging cost, declined to claim a mistake, and verified its bid. The protester believed that the award was improper because there was no agreement at the time of bid opening that forged parts would be furnished. GAO did not find it necessary to determine whether the kind of mistake alleged was subject to correction. Ordinarily, a contracting officer is required to reject a bid which is clearly mistaken even when the bidder denies making a mistake, unless the bid is correctable. Exceptions to this rule have been permitted when it was clear that the bidder would have been lowest, absent the mistake, even though the amount of the intended bid could not be proven for the purpose of allowing bid correction. In this case, it was not clear how much of an error the awardee was permitted to waive, nor was it clear that the awardee's price would have been low had no mistake been made. Therefore, this award was not within the exception to the rule against waiver. GAO recommended that the award be terminated for the convenience of the Government and the procurement be reopened for award consistent with the Defense Acquisition Regulation. Thus, the protest was sustained.