B-80232, OCTOBER 26, 1948, 28 COMP. GEN. 261

B-80232: Oct 26, 1948

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BIDS - MISTAKES - SALES OF SURPLUS PROPERTY WHERE AN INVITATION TO BID FOR THE PURCHASE OF SURPLUS PROPERTY WAS CLEAR AND UNAMBIGUOUS AND THE CONTRACTING OFFICER HAD NO NOTICE OF AN ALLEGED MATHEMATICAL ERROR OF THE BIDDER IN COMPUTING ITS BID PRICE UNTIL AFTER AWARD. 1948: I HAVE YOUR LETTER OF SEPTEMBER 16. TO HAVE BEEN MADE IN ITS BID ON WHICH CONTRACT IND. WAS AWARDED. THE ESTIMATED COST OF THE LENS TISSUE PAPER WAS STATED IN THE INVITATION TO BE 30 CENTS PER PACKAGE OR $300 PER LOT FOR EACH OF LOTS A TO W. THE BID OF THE CORPORATION WAS ACCEPTED AS TO LOTS A TO X. ADVISED THE CONTRACTING OFFICER THAT IT "HURRIEDLY ASSEMBLED" THE FIGURES IN ORDER TO GET THE BID READY BEFORE THE OPENING DATE AND THAT IN SO DOING A MATHEMATICAL ERROR WAS MADE WHICH WAS EXPLAINED AS FOLLOWS: THE STANDARD SIZE TISSUE OF THIS TYPE IS 24 INCHES BY 36 INCHES.

B-80232, OCTOBER 26, 1948, 28 COMP. GEN. 261

BIDS - MISTAKES - SALES OF SURPLUS PROPERTY WHERE AN INVITATION TO BID FOR THE PURCHASE OF SURPLUS PROPERTY WAS CLEAR AND UNAMBIGUOUS AND THE CONTRACTING OFFICER HAD NO NOTICE OF AN ALLEGED MATHEMATICAL ERROR OF THE BIDDER IN COMPUTING ITS BID PRICE UNTIL AFTER AWARD, SUCH MISTAKE MUST BE REGARDED AS UNILATERAL--- NOT MUTUAL--- DUE SOLELY TO THE BIDDER'S NEGLIGENCE, AND AS NOT ENTITLING IT TO ANY RELIEF ON ACCOUNT OF SUCH ERRONEOUS BID WHICH, HAVING BEEN ACCEPTED BY THE GOVERNMENT IN GOOD FAITH, CONSUMMATED A VALID AND BINDING CONTRACT.

COMPTROLLER GENERAL WARREN TO THE SECRETARY OF THE ARMY, OCTOBER 26, 1948:

I HAVE YOUR LETTER OF SEPTEMBER 16, 1948, WITH ENCLOSURES, RELATIVE TO AN ERROR ALLEGED BY GENERAL PRODUCTS, INC., PITTSBURGH, PENNSYLVANIA, TO HAVE BEEN MADE IN ITS BID ON WHICH CONTRACT IND. W 28 024-/A.A.-1/-S-666 DATED AUGUST 5, 1948, WAS AWARDED. YOU REQUEST A DECISION AS TO WHETHER THE CONTRACT MAY BE CANCELED AS REQUESTED BY THE CORPORATION.

UNDER DATE OF JULY 12, 1948, THE RARITAN ARSENAL, METUCHEN, NEW JERSEY, BY INVITATION IND. 28-024-S-49-6, REQUESTED BIDS--- TO BE OPENED JULY 27, 1948--- FOR THE PURCHASE OF CERTAIN SURPLUS PROPERTY FROM THE GOVERNMENT. THE PROPERTY OFFERED FOR SALE INCLUDED LOTS A TO W, INCLUSIVE, EACH OF WHICH COVERED 1,000 PACKAGES OF NEW PAPER, LENS, TISSUE, 7 1/2 INCHES BY 11 INCHES, APPROXIMATELY 500 SHEETS PER PACKAGE, AND LOT X COVERING 1,126 PACKAGES OF THE SAME PAPER. THE ESTIMATED COST OF THE LENS TISSUE PAPER WAS STATED IN THE INVITATION TO BE 30 CENTS PER PACKAGE OR $300 PER LOT FOR EACH OF LOTS A TO W, INCLUSIVE, AND $337.80 FOR LOT X.

IN RESPONSE TO THE INVITATION, GENERAL PRODUCTS, INC., SUBMITTED A BID DATED JULY 26, 1948, WHEREIN IT OFFERED TO PURCHASE LOTS A TO X, INCLUSIVE, FOR $215 PER LOT. THE BID OF THE CORPORATION WAS ACCEPTED AS TO LOTS A TO X, INCLUSIVE, ON AUGUST 5, 1948.

BY LETTER DATED AUGUST 28, 1948, GENERAL PRODUCTS, INC., ADVISED THE CONTRACTING OFFICER THAT IT "HURRIEDLY ASSEMBLED" THE FIGURES IN ORDER TO GET THE BID READY BEFORE THE OPENING DATE AND THAT IN SO DOING A MATHEMATICAL ERROR WAS MADE WHICH WAS EXPLAINED AS FOLLOWS:

THE STANDARD SIZE TISSUE OF THIS TYPE IS 24 INCHES BY 36 INCHES. SINCE THE SIZE ON THIS OFFERING IS 7 1/2 INCHES X 11 INCHES, I DIVIDED THIS SIZE INTO THE LARGER STANDARD SIZE AND GOT 3. I THEREFORE BASED MY BID ON 1/3 OF THE STANDARD SIZE. HOWEVER, A RE-EXAMINATION PROVED THAT THE CORRECT ANSWER WAS 9, AND MY BID SHOULD HAVE BEEN BASED ON 1/9 OF STANDARD SIZE. THE CORPORATION STATED THEREIN THAT THE ERROR IN ITS BID WAS "IN NO WAY THE FAULT OF THE RARITAN ARSENAL, BY WHOM THE LOT WAS SOLD. THE MERCHANDISE WAS FAIRLY AND CLEARLY REPRESENTED AND THE ERROR WAS ENTIRELY MINE.'

THE INVITATION ISSUED IN THE PRESENT CASE WAS CLEAR AND UNAMBIGUOUS AND LEFT NO ROOM FOR DOUBT THAT THE LENS TISSUE PAPER OFFERED FOR SALE UNDER LOTS A TO X, INCLUSIVE, WAS 7 1/2 INCHES X 11 INCHES. THE RESPONSIBILITY FOR THE PREPARATION OF THE BID SUBMITTED IN RESPONSE THERETO WAS UPON THE BIDDER. SEE FRAZIER-DAVIS CONSTRUCTION COMPANY V. UNITED STATES, 100 C.1CLS. 120, 163. IF, AS STATED IN ITS LETTER OF AUGUST 28, 1948, GENERAL PRODUCTS, INC., MADE AN ERROR IN THE METHOD USED IN COMPUTING IT BID PRICE, SUCH ERROR WAS DUE SOLELY TO ITS OWN NEGLIGENCE--- AS ADMITTED BY THE CORPORATION--- AND WAS IN NO WAY INDUCED OR CONTRIBUTED TO BY THE GOVERNMENT. ANY ERROR THAT WAS MADE IN THE BID WAS UNILATERAL--- NOT MUTUAL--- AND, THEREFORE, DOES NOT ENTITLE THE CORPORATION TO RELIEF. SEE OGDEN AND DOUGHERTY V. UNITED STATES, 102 C.1CLS. 249, 259., SALIGMAN, ET AL. V. UNITED STATES, 56 F.1SUPP. 505, 507; STEINMEYER, ET AL. V. SCHROEPPEL, 226 ILL. 9, 80 N.E. 564; AND HOLMES V. CAMERON, ET AL., 267 PA. 90, 110 A. 81, 82, WHEREIN THE SUPREME COURT OF PENNSYLVANIA SAID:

* * * THERE IS NOTHING TO TAKE THIS CASE OUT OF THE GENERAL RULE THAT, IN THE ABSENCE OF FRAUD, A PARTY WILL NOT BE RELIEVED FROM A CONTRACT BECAUSE OF HIS OWN MISTAKE.

IN A MEMORANDUM DATED SEPTEMBER 7, 1948, THE CONTRACTING OFFICER STATED:

BECAUSE OF THE WIDE VARIANCES IN PRICES ORDINARILY RECEIVED ON BIDS FOR SALES, THE ALLEGED ERROR WAS NOT EVIDENT TO THE CONTRACTING OFFICER PRIOR TO AWARD.

IN VIEW OF THE WIDE RANGE OF PRICES RECEIVED ON WASTE, SALVAGE, AND SURPLUS PROPERTY, A MERE DIFFERENCE IN PRICE BID WOULD NOT NECESSARILY PLACE A CONTRACTING OFFICER ON NOTICE OF THE PROBABILITY OF ERROR IN A BID FOR THE PURCHASE THEREOF FROM THE GOVERNMENT AS WOULD A LIKE DIFFERENCE IN THE PRICES QUOTED ON NEW EQUIPMENT, SUPPLIES, ETC., TO BE FURNISHED THE GOVERNMENT. SEE 16 COMP. GEN. 596; 17 ID. 388; ID. 601; ID. 976. THE PRESENT RECORD INDICATES THAT THE BID OF GENERAL PRODUCTS, INC., WAS ACCEPTED IN GOOD FAITH, NO ERROR HAVING BEEN ALLEGED UNTIL MORE THAN THREE WEEKS AFTER AWARD. ALSO, THE PRICES QUOTED BY THE CORPORATION FOR THE LENS TISSUE PAPER COVERED BY LOTS A TO X, INCLUSIVE--- WHICH WAS CLASSIFIED AS NEW--- ARE LESS THAN THE ESTIMATED COST OF THE PAPER TO THE GOVERNMENT; HENCE, THE ENFORCEMENT OF THE CONTRACT WOULD NOT APPEAR TO BE UNCONSCIONABLE. CONSEQUENTLY, THERE WOULD APPEAR TO BE NO BASIS ON WHICH IT COULD BE HELD THAT THE ACCEPTANCE OF THE BID DID NOT CONSUMMATE A VALID AND BINDING CONTRACT. SEE UNITED STATES V. PURCELL ENVELOPE COMPANY, 249 U.S. 313; AND AMERICAN SMELTING AND REFINING COMPANY V. UNITED STATES, 259 U.S. 75. THE RIGHT WHICH VESTED IN THE GOVERNMENT UPON SUCH ACCEPTANCE CANNOT BE GIVEN AWAY OR SURRENDERED BY ANY OFFICER OF THE GOVERNMENT. SEE UNITED STATES V. AMERICAN SALES CORPORATION, 27 F.2D 389, AFFIRMED 32 F.2D 141, CERTIORARI DENIED 280 U.S. 574; PACIFIC HARDWARE AND STEEL COMPANY V. UNITED STATES, 49 C.1CLS. 327, 335, AND BAUSCH AND LOMB OPTIONAL COMPANY V. UNITED STATES, 78 C.1CLS. 584, 607, CERTIORARI DENIED 292 U.S. 645.

ACCORDINGLY, I FIND NO LEGAL BASIS FOR RELIEVING GENERAL PRODUCTS, INC., FROM OBLIGATION UNDER CONTRACT NO. W 28-024-/A.A.-1/-S-666.

THE PAPERS, WITH THE EXCEPTION OF THE STATEMENT OF SEPTEMBER 7, 1948, FROM THE CONTRACTING OFFICER, ARE RETURNED HEREWITH.