B-62299, DECEMBER 13, 1946, 26 COMP. GEN. 415

B-62299: Dec 13, 1946

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BIDS - MISTAKES WHERE AN INVITATION TO BID WAS CLEAR AND UNAMBIGUOUS AS TO THE EQUIPMENT TO BE FURNISHED AND THE CONTRACTING OFFICER HAD NO NOTICE OF THE ALLEGED ERROR OF THE SOLE BIDDER IN EXTENDING THE UNIT PRICE AS THE TOTAL PRICE UNTIL AFTER AWARD. 1946: I HAVE YOUR LETTER OF NOVEMBER 20. TO HAVE BEEN MADE IN ITS BID DATED OCTOBER 7. PRICES QUOTED ARE F.O.B. THE BID WAS ACCEPTED BY ORDER NO. THE COMPANY ADVISED THE PANAMA CANAL THAT IT SHOULD HAVE QUOTED A PRICE OF $20.38. THEREOF AND STATED THAT IT WOULD BE NOTICED THEREFROM THAT THE LIST PRICE OF A NO. 533 BALL BEARING LOWER SWIVEL HOOK FOR A 1/2-TON BB SPUR-GEARED HOIST IS $4.65. THAT THE LIST PRICE OF 21 FEET OF LOAD CHAIN IS 80 CENTS PER FOOT.

B-62299, DECEMBER 13, 1946, 26 COMP. GEN. 415

BIDS - MISTAKES WHERE AN INVITATION TO BID WAS CLEAR AND UNAMBIGUOUS AS TO THE EQUIPMENT TO BE FURNISHED AND THE CONTRACTING OFFICER HAD NO NOTICE OF THE ALLEGED ERROR OF THE SOLE BIDDER IN EXTENDING THE UNIT PRICE AS THE TOTAL PRICE UNTIL AFTER AWARD, SUCH MISTAKE MUST BE REGARDED AS UNILATERAL--- NOT MUTUAL--- DUE SOLELY TO THE BIDDER'S NEGLIGENCE OR OVERSIGHT, AND AS NOT AFFORDING ANY LEGAL BASIS FOR MODIFYING THE PRICE SPECIFIED IN THE BID WHICH, HAVING BEEN ACCEPTED BY THE GOVERNMENT IN GOOD FAITH, CONSUMMATED A VALID AND BINDING CONTRACT.

COMPTROLLER GENERAL WARREN TO CHIEF OF OFFICE, THE PANAMA CANAL, DECEMBER 13, 1946:

I HAVE YOUR LETTER OF NOVEMBER 20, 1946, WITH ENCLOSURES, RELATIVE TO AN ERROR ALLEGED BY THE YALE AND TOWNE MANUFACTURING COMPANY, PHILADELPHIA, PENNSYLVANIA, TO HAVE BEEN MADE IN ITS BID DATED OCTOBER 7, 1946, AND REQUESTING A DECISION AS TO WHETHER THE BID MAY BE CORRECTED.

THE PANAMA CANAL, BY INVITATION NO. I-15970, DATED OCTOBER 4, 1946, REQUESTED THE YALE AND TOWNE MANUFACTURING COMPANY TO SUBMIT A BID FOR FURNISHING ONE LOAD CHAIN AS DESCRIBED THEREIN. IN RESPONSE TO THE INVITATION, THE COMPANY SUBMITTED A BID DATED OCTOBER 7, 1946, OFFERING TO FURNISH, AT THE PRICE INDICATED, THE EQUIPMENT DESCRIBED AS FOLLOWS:

CHART

UNIT TOTAL

QUANTITY PRICE PRICE HOIST PARTS, CHAIN, SPURGEAR, TYPE

" BB," 1/2 TON CAPACITY; AS

SUPPLIED UNDER OUR ORDER W-79122, DATED

8-3-44, YOUR INVOICE G119933, 8-24-44:

LOAD CHAIN, 9/32 INCHES, NO. 364003, 1 ONLY $10.38 $10.38

21 FT. LONG, COMPLETE WITH NO. 533

BALL BEARING LOWER SWIVEL HOOK.

PRICES QUOTED ARE F.O.B. THIS PLANT, PHILA., PENNA.

THE BID WAS ACCEPTED BY ORDER NO. W-95993, DATED OCTOBER 17, 1946, WHICH ORDER COVERED, ALSO, SEVERAL OTHER ITEMS ON WHICH THE COMPANY HAD SUBMITTED A BID IN RESPONSE TO ANOTHER INVITATION, THE TOTAL OF THE ORDER BEING A NET AMOUNT OF $140.10.

BY LETTER DATED OCTOBER 23, 1946, THE COMPANY ADVISED THE PANAMA CANAL THAT IT SHOULD HAVE QUOTED A PRICE OF $20.38, INSTEAD OF $10.38 FOR THE LOAD CHAIN. IN REPLY TO LETTER DATED OCTOBER 29, 1946, FROM THE PANAMA CANAL, REQUESTING EVIDENCE TO SUPPORT THE ALLEGATION OF ERROR, THE COMPANY BY LETTER DATED NOVEMBER 1, 1946, FURNISHED ITS SPARE PARTS PRICE LIST AND INVITED ATTENTION TO PAGE 8 (9?) THEREOF AND STATED THAT IT WOULD BE NOTICED THEREFROM THAT THE LIST PRICE OF A NO. 533 BALL BEARING LOWER SWIVEL HOOK FOR A 1/2-TON BB SPUR-GEARED HOIST IS $4.65, AND THAT THE LIST PRICE OF 21 FEET OF LOAD CHAIN IS 80 CENTS PER FOOT, MAKING AN AGGREGATE AMOUNT OF $21.45, WHICH WAS SUBJECT TO A DISCOUNT OF 5 PERCENT, RESULTING IN A NET AMOUNT OF $20.38.

THERE WAS NOTHING ON THE FACE OF THE BID OF THE COMPANY TO INDICATE THAT THE UNIT PRICE OF $10.38 FOR ONE LOAD CHAIN AND THE EXTENDED TOTAL PRICE THEREFOR OF $10.38 WERE NOT AS INTENDED. ALSO, SINCE THE BID OF THE COMPANY WAS THE ONLY BID ON THE LOAD CHAIN, THERE WAS NO BASIS FOR COMPARISON OF BIDS. CONSEQUENTLY, THERE WAS NOTHING TO PLACE THE CONTRACTING OFFICER ON NOTICE OF THE PROBABILITY OF ERROR IN THE BID. ALTHOUGH, AFTER AWARD, THE COMPANY SUBMITTED ITS PRICE LIST, IT DOES NOT APPEAR THAT, PRIOR TO AWARD, THE CONTRACTING OFFICER HAD KNOWLEDGE OF THE FACTORS USED BY THE COMPANY IN COMPUTING ITS BID PRICE. SO FAR AS THE PRESENT RECORD SHOWS THE ACCEPTANCE OF THE BID WAS IN GOOD FAITH, NO ERROR HAVING BEEN ALLEGED BY THE COMPANY UNTIL AFTER AWARD. SEE, IN THAT CONNECTION, THE CASE OF OGDEN AND DOUGHERTY V. UNITED STATES, 102 C.1CLS. 249, 259, WHEREIN THE COURT OF CLAIMS OF THE UNITED STATES SAID:

THERE CAN BE NO DOUBT THAT UPON ACCEPTANCE OF THEIR BID PLAINTIFFS BECAME OBLIGATED TO DO THE WORK FOR THE AMOUNT BID. WHEN THE CONTRACTING OFFICER ACCEPTED THE BID HE WAS UNAWARE THAT ANY MISTAKE HAD BEEN MADE. PLAINTIFFS HAD FAILED TO NOTIFY HIM OF IT. NOR WAS THERE ANYTHING TO PUT HIM ON NOTICE THAT A MISTAKE PROBABLY HAD BEEN MADE. PLAINTIFFS DO NOT CLAIM THAT THERE WAS. WE HAVE, THEN, A UNILATERAL MISTAKE, FROM WHICH, OF COURSE, EQUITY WILL NOT RELIEVE * * *.

CONSEQUENTLY, THERE WOULD APPEAR TO BE NO BASIS ON WHICH IT COULD BE HELD THAT THE ACCEPTANCE OF THE BID OF THE COMPANY DID NOT CONSUMMATE A VALID AND BINDING CONTRACT. SEE UNITED STATES V. NEW YORK AND PORTO RICO STEAMSHIP COMPANY, 239 U.S. 88; UNITED STATES V. PURCELL ENVELOPE COMPANY, 249 U.S. 313; AND AMERICAN SMELTING AND REFINING COMPANY V. UNITED STATES, 259 U.S. 75. ALSO, SEE 18 COMP. GEN. 942; 20 ID. 652; AND 25 ID. 536.

FURTHERMORE, THE INVITATION ISSUED IN THE PRESENT CASE WAS CLEAR AND UNAMBIGUOUS AND LEFT NO ROOM FOR DOUBT AS TO THE EQUIPMENT REQUIRED TO BE FURNISHED. THE RESPONSIBILITY FOR THE PREPARATION OF THE BID SUBMITTED IN RESPONSE THERETO WAS UPON THE BIDDER. AS STATED BY THE COURT OF CLAIMS OF THE UNITED STATES IN THE CASE OF FRAZIER-DAVIS CONSTRUCTION COMPANY V. UNITED STATES, 100 C.1CLS. 120, 163:

* * * THE PARTIES ARE DEALING AT ARMS LENGTH AND BIDDERS ARE PRESUMED TO BE QUALIFIED TO ESTIMATE THE PRICE AT WHICH THEY CAN PERFORM THE WORK SPECIFIED AT A REASONABLE PROFIT. IF THEY FAIL TO DO SO, AS PLAINTIFF DID IN THIS CASE, THE GOVERNMENT CANNOT FOR THAT REASON BE HELD FOR THE RESULTING LOSS.

IT IS CLEAR THAT SUCH ERROR AS WAS MADE IN THE BID OF THE COMPANY WAS DUE SOLELY TO ITS OWN NEGLIGENCE OR OVERSIGHT AND WAS IN NO WAY INDUCED OR CONTRIBUTED TO BY THE GOVERNMENT. ANY ERROR THAT WAS MADE IN THE BID OF THE COMPANY WAS UNILATERAL--- NOT MUTUAL--- AND, THEREFORE, DOES NOT ENTITLE THE COMPANY TO RELIEF. SEE OGDEN AND DOUGHERTY V. UNITED STATES, SUPRA; AND SALIGMAN ET AL. V. UNITED STATES, 56 F.1SUPP. 505, 507, WHEREIN THE DISTRICT COURT OF THE UNITED STATES FOR THE DISTRICT OF PENNSYLVANIA, EASTERN DIVISION, SAID:

* * * ORDINARILY NO RELIEF WILL BE GRANTED TO A PARTY TO AN EXECUTORY CONTRACT IN THE CASE OF A UNILATERAL MISTAKE. IN SUCH CASE WHEN A BID HAS BEEN ACCEPTED THE BIDDER WHO HAS MADE A MISTAKE WILL BE BOUND AND MUST BEAR THE CONSEQUENCES THEREOF. ( CITING COURT DECISIONS.)

ACCORDINGLY, I FIND NO LEGAL BASIS FOR MODIFYING THE PRICE SPECIFIED FOR THE LOAD CHAIN IN THE BID OF THE COMPANY AND, THEREFORE, THE COMPANY SHOULD BE REQUIRED TO FURNISH THE EQUIPMENT AT THE PRICE SPECIFIED THEREFOR IN ITS BID.