B-91381, MARCH 31, 1950, 29 COMP. GEN. 393

B-91381: Mar 31, 1950

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THE QUESTION AS TO WHETHER A BID MAY BE CHANGED OR WITHDRAWN AFTER THE TIME FIXED FOR OPENING IS FOR DETERMINATION BY THE GENERAL ACCOUNTING OFFICE PRIOR TO FINAL ADMINISTRATIVE ACTION THEREON. PROVIDED THE CONTROL OF ALL SUCH DETERMINATIONS IS CENTRALIZED SO AS TO INSURE UNIFORMITY IN HANDLING. 1950: FURTHER REFERENCE IS MADE TO YOUR LETTER OF DECEMBER 15. YOUR LETTER IS. DURING THE LAST FISCAL YEAR A TOTAL OF ONE HUNDRED AND NINETY-FIVE (195) CASES WERE SUBMITTED. WHILE DURING THE FIRST FIVE (5) MONTHS OF THE CURRENT FISCAL YEAR THERE HAVE BEEN ONE HUNDRED AND THIRTY-THREE (133) SUCH CASES. THE PRESENT VOLUME CONTINUES AND NO DECREASE IS PRESENTLY ANTICIPATED. THE NUMBER OF MISTAKE IN BID CASES FOR THE FISCAL YEAR 1950 WILL APPROXIMATE THREE HUNDRED (300).

B-91381, MARCH 31, 1950, 29 COMP. GEN. 393

BIDS - MISTAKES - CHANGE OR WITHDRAWAL BY NAVY DEPARTMENT WHILE, GENERALLY, THE QUESTION AS TO WHETHER A BID MAY BE CHANGED OR WITHDRAWN AFTER THE TIME FIXED FOR OPENING IS FOR DETERMINATION BY THE GENERAL ACCOUNTING OFFICE PRIOR TO FINAL ADMINISTRATIVE ACTION THEREON, THE NAVY DEPARTMENT MAY, WITHOUT SUBMISSION FOR ADVANCE DECISION, DETERMINE CERTAIN TYPES OF CASES INVOLVING ERRORS IN BIDS ALLEGED PRIOR TO AWARD, PROVIDED THE CONTROL OF ALL SUCH DETERMINATIONS IS CENTRALIZED SO AS TO INSURE UNIFORMITY IN HANDLING; HOWEVER, THIS OFFICE RESERVES THE RIGHT TO QUESTION THE CORRECTNESS OF THE ADMINISTRATIVE DETERMINATIONS WHEN DEEMED NECESSARY.

COMPTROLLER GENERAL WARREN TO THE SECRETARY OF THE NAVY, MARCH 31, 1950:

FURTHER REFERENCE IS MADE TO YOUR LETTER OF DECEMBER 15, 1949, REQUESTING AUTHORITY TO DETERMINE ADMINISTRATIVELY, WITHOUT THE SUBMISSION THEREOF TO THIS OFFICE FOR ADVANCE DECISION, CERTAIN TYPES OF ERROR IN BID CASES. YOUR LETTER IS, IN PART, AS FOLLOWS:

THE RECORDS OF THE DEPARTMENT ALSO SHOW THAT THE VOLUME OF MISTAKE IN BID CASES HAS INCREASED MATERIALLY DURING THE CURRENT FISCAL YEAR. DURING THE LAST FISCAL YEAR A TOTAL OF ONE HUNDRED AND NINETY-FIVE (195) CASES WERE SUBMITTED, WHILE DURING THE FIRST FIVE (5) MONTHS OF THE CURRENT FISCAL YEAR THERE HAVE BEEN ONE HUNDRED AND THIRTY-THREE (133) SUCH CASES. THE PRESENT VOLUME CONTINUES AND NO DECREASE IS PRESENTLY ANTICIPATED, THE NUMBER OF MISTAKE IN BID CASES FOR THE FISCAL YEAR 1950 WILL APPROXIMATE THREE HUNDRED (300).

THE HANDLING OF SUCH CASES UNDER PRESENT PROCEDURE WOULD APPEAR TO TAX UNREASONABLY THE FACILITIES OF BOTH YOUR OFFICE AND THE ADMINISTRATIVE OFFICES. IT SEEMS TO THIS DEPARTMENT HIGHLY DESIRABLE TO MINIMIZE THE NUMBER OF SUCH COMPARATIVELY SIMPLE MISTAKE IN BID CASES PRESENTLY BEING SUBMITTED FOR YOUR DECISION. A REVIEW OF THE MISTAKE IN BID CASES SUBMITTED TO YOU BY THIS DEPARTMENT REVEALS THAT, IN THE ABOVE TYPES OF CASES, YOUR OFFICE HAS, WITH RELATIVELY FEW EXCEPTIONS, CONCURRED IN OUR RECOMMENDATIONS. IN THESE CIRCUMSTANCES, IT IS SUGGESTED THAT THE SUBMISSION OF SEVENTY PERCENT (70 PERCENT) OF ALL MISTAKE CASES MIGHT BE ELIMINATED WERE THE DEPARTMENT AUTHORIZED TO MAKE DETERMINATIONS WITH RESPECT TO THE TYPES OF CASES MENTIONED ABOVE. YOUR ADVICE IS RESPECTFULLY REQUESTED, THEREFORE, AS TO WHETHER THIS DEPARTMENT MAY DETERMINE, WITHOUT SUBMISSION, BUT SUBJECT TO SUCH REVIEW AS YOUR OFFICE MAY DEEM APPROPRIATE, MISTAKE IN BID CASES FALLING WITHIN THE THREE CATEGORIES SPECIFIED ABOVE.

IF SUCH AUTHORITY BE GRANTED, IT IS THE INTENT AND WOULD BE THE POLICY OF THIS DEPARTMENT THAT THE AUTHORIZATION WOULD BE RESTRICTED TO CASES WHERE THE EVIDENCE IS CLEAR AND CONVINCING AND THAT ALL DOUBTFUL CASES COMING WITHIN SAID CATEGORIES WOULD STILL BE SUBMITTED FOR YOUR DECISION. DETERMINATIONS WOULD BE MADE WITH RESPECT TO CORRECTIONS IN BIDS PRIOR TO, OR AFTER, AWARD.

IF THE AUTHORITY REQUESTED HEREIN BE GRANTED, THE DEPARTMENT WOULD CENTRALIZE THE CONTROL OF ALL SUCH AUTHORIZED DETERMINATIONS.

THE TYPES OF ERROR IN BID CASES FOR WHICH SUCH AUTHORITY IS REQUESTED ARE STATED TO FALL WITHIN THE FOLLOWING THREE CATEGORIES:

(A) A BID IS, OR IS NOT, CLEARLY OUT OF LINE WITH THE GENERAL PATTERN OF BIDDING BUT THE BIDDER, PRIOR TO AWARD, ALLEGES AND OFFERS CLEAR AND CONVINCING EVIDENCE OF A MISTAKE AND REQUESTS THAT THE BID BE DISREGARDED.

(B) A BID IS, OR IS NOT, OBVIOUSLY OUT OF LINE WITH THE GENERAL PATTERN OF BIDDING, AND THE BIDDER, PRIOR TO AWARD, ALLEGES, BUT DOES NOT OFFER CLEAR CONVINCING EVIDENCE OF, A MISTAKE AND REQUESTS THAT THE BID BE DISREGARDED.

(C) A BID IS, OR IS NOT, OBVIOUSLY OUT OF LINE WITH THE GENERAL PATTERN OF BIDDING, AND THE BIDDER, PRIOR TO AWARD, ALLEGES AND OFFERS CLEAR AND CONVINCING EVIDENCE OF A MISTAKE, AND REQUESTS CORRECTION OF THE BID BUT DOES NOT OFFER CLEAR AND CONVINCING EVIDENCE OF THE ACTUALLY INTENDED BID PRICE.

IT CONSISTENTLY HAS BEEN HELD THAT THE QUESTION AS TO WHETHER A BID MAY BE CHANGED OR WITHDRAWN AFTER THE TIME FIXED FOR OPENING DEPENDS NOT ALONE ON WHETHER THE BIDDER MADE A MISTAKE BUT ON THE APPLICATION OF CERTAIN LEGAL PRINCIPLES TO THE ESTABLISHED FACTS IN THE PARTICULAR CASE, AND SUCH QUESTIONS NECESSARILY ARE FOR FINAL DETERMINATION BY THIS OFFICE AS INVOLVING THE LEGALITY OF THE AMOUNT TO BE CHARGED AGAINST PUBLIC FUNDS. SEE 8 COMP. GEN. 397; 11 ID. 65; 15 ID. 744; 16 ID. 193; AND 18 ID. 22. IN ORDER THAT SUCH CASES MIGHT BE HANDLED UNIFORMLY, TO AVOID POSSIBLE ADMINISTRATIVE ABUSES, TO PROTECT ACCOUNTABLE AND CONTRACTING OFFICERS, AND TO INSURE FAIRNESS TO BIDDERS, IT HAS BEEN REQUIRED, GENERALLY, THAT CASES INVOLVING ALLEGATIONS OF ERROR IN BIDS MADE PRIOR TO AWARD BE SUBMITTED TO THIS OFFICE FOR DECISION PRIOR TO FINAL ADMINISTRATIVE ACTION THEREON. EXCEPTIONS HAVE BEEN MADE TO THIS RULE IN EXTREMELY CLEAR CASES WHERE THE ERROR IS ALLEGED AND ESTABLISHED BY THE BIDDER PRIOR TO AWARD, SUCH AS IN THE CASE OF THE QUOTATION OF A LOWER PRICE F.O.B. DESTINATION THAN F.O.B. FACTORY (16 COMP. GEN. 999); A MISPLACED DECIMAL POINT (17 COMP. GEN. 339); AN OBVIOUS ERROR IN DISCOUNT (17 COMP. GEN. 493); AND AN ERROR IN THE EXTENSION OF THE UNIT PRICE (18 COMP. GEN. 1003).

HOWEVER, IN VIEW OF THE STATEMENT MADE IN YOUR LETTER THAT IF THE AUTHORITY REQUESTED BE GRANTED THE CONTROL OF ALL SUCH AUTHORIZED DETERMINATIONS WOULD BE CENTRALIZED, THERE IS REMOVED A PRINCIPAL OBJECTION TO THE GRANTING OF SUCH AUTHORITY AS SUCH A PROCEDURE SHOULD TEND TO INSURE UNIFORMITY IN HANDLING SUCH CASES, WHICH UNDOUBTEDLY WOULD NOT EXIST IF SUCH AUTHORITY WERE GRANTED TO THE VARIOUS PURCHASING AGENCIES OF THE NAVAL ESTABLISHMENT. UNDER THE CIRCUMSTANCES RELATED IN YOUR LETTER THIS OFFICE WILL NOT OBJECT, FOR THE PRESENT, TO THE PROCEDURE PROPOSED OF DETERMINING ADMINISTRATIVELY THE THREE TYPES OF CASES CITED, WHERE ERROR IS ALLEGED PRIOR TO AWARD, WITHOUT SUBMISSION OF THE MATTER FOR ADVANCE DECISION.

IT SHOULD BE CLEARLY UNDERSTOOD THAT THE APPROVAL OF THE PROCEDURE PROPOSED IS IN NO SENSE TO BE CONSTRUED AS APPROVAL OF THE ACTION WHICH MAY BE TAKEN IN ANY CASE; THAT THIS OFFICE RESERVES THE RIGHT TO QUESTION THE CORRECTNESS OF SUCH ACTION IN THE AUDIT OF ACCOUNTS; THAT THE PROCEDURE CANNOT OPERATE TO DEPRIVE A BIDDER OF HIS RIGHT TO HAVE THE MATTER DETERMINED BY THIS OFFICE, SHOULD HE SO REQUEST; AND THAT APPROVAL OF THE PROCEDURE WILL BE WITHDRAWN SHOULD IT HEREAFTER APPEAR THAT SUCH ACTION WOULD BE IN THE BEST INTERESTS OF THE UNITED STATES.

A COMPLETE STATEMENT OF FACTS SHOULD ACCOMPANY THE CONTRACT AWARDED IN EACH CASE IN WHICH THE LOW BID HAS BEEN DISREGARDED.