MAR. 26, 1970

MAR. 26, 1970

BIDS--MISTAKES--VERIFICATION PRIOR TO ALLEGATION OF ERROR DECISION DENYING RELIEF TO CONTRACTOR ALLEGING MISTAKE IN BID PRICES IS AFFIRMED SINCE VERIFICATION REQUEST REQUIRES NO SPECIAL LANGUAGE, AND TWO REQUESTS HERE MADE FOR VERIFICATION SUBSTANTIALLY COMPLIED WITH FPR 1- 2.406-3 (D) (1) REQUIREMENTS AS WELL AS COMPORT WITH PRIOR GAO DECISIONS. MOREOVER, IN DISPUTES OF FACT---HERE COMMUNICATION OF FACTS PROMPTING VERIFICATION---ADMINISTRATIVE STATEMENT IS PRESUMED CORRECT ABSENT EVIDENCE SUFFICIENTLY CONVINCING TO OVERCOME PRESUMPTION, NOR CAN ANY ADMINISTRATIVE STATEMENTS GIVING RISE TO EXPECTATION OF ADDITIONAL PAYMENTS AFFECT LEGAL RIGHTS OR OBLIGATIONS FIXED BY CONTRACT. SEE COMP. GEN. DEC. CITED.

TO MANISCALCO, CLANCY & PITTMAN:

REFERENCE IS MADE TO YOUR LETTERS OF NOVEMBER 26 AND DECEMBER 2, 1969, WITH ENCLOSURE, REQUESTING ON BEHALF OF THE MCMULLEN PRINTING COMPANY, RECONSIDERATION OF OUR DECISION OF MARCH 26, 1969, B-166191 ET AL; TO THE PUBLIC PRINTER, IN WHICH WE HELD THAT THERE WAS NO LEGAL BASIS FOR PAYMENT OF ANY ADDITIONAL AMOUNT TO THAT FIRM UNDER PURCHASE ORDERS NOS. 43611, 43612, 43614 THROUGH 43616 AND 43618 THROUGH 43622 BECAUSE OF ERRORS MADE BY THE COMPANY IN THE BIDS UPON WHICH THE PURCHASE ORDERS WERE AWARDED.

RELIEF WAS DENIED ON THE BASIS THAT MCMULLEN HAD VERIFIED ITS BIDS WITH KNOWLEDGE OF THE FACTS WHICH PROMPTED THE CONTRACTING OFFICER TO REQUEST VERIFICATION AND THAT THE RESULTING ERRORS WERE UNILATERAL- NOT MUTUAL-- AND THEREFORE DID NOT ENTITLE THE COMPANY TO RELIEF.

YOUR LETTER OF NOVEMBER 26, 1969, STATES, IN PERTINENT PART, AS FOLLOWS:

"I HAVE YOUR LETTER TO MR. HARRISON CONCERNING THE ABOVE-CAPTIONED REFERENCE NUMBERS DATED MARCH 26, 1969. I WANT TO TAKE AN OPPORTUNITY TODAY TO CORRECT AN ERROR WHICH I BELIEVE HAS LED YOUR OFFICE TO MISUNDERSTAND SOME OF THE THINGS THAT TRANSPIRED IN THE MCMULLEN PRINTING COMPANY'S DISCUSSION WITH THE ST. LOUIS GPO REPRESENTATIVE.

"IN THE LAST PARAGRAPH OF PAGE THREE OF YOUR LETTER TO MR. HARRISON, YOU MAKE REFERENCE TO THE FACT THAT MCMULLEN PRINTING COMPANY WAS ADVISED THAT THEIR BID PRICES WERE EXTREMELY LOW IN COMPARISON TO THE OTHER BIDDERS AND YOU INDICATED THE INFORMATION YOU HAVE WAS IN AFFECT THAT MCMULLEN PRINTING COMPANY WAS GIVEN THE AMOUNTS OF THE THREE LOWEST BIDS ON EACH OF THE TEN JOBS AND WITH THAT INFORMATION IN HAND PROCEEDED TO AGAIN CONFIRM ITS BIDS (PLEASE NOTE THAT THIS HAS TO BE INCORRECT, PARTICULARLY IN VIEW OF THE FACT THAT ON JACKETS 320-944, 945, 947, 950, THERE WAS ONLY ONE BIDDER).

"I MET WITH THE REPRESENTATIVES OF MCMULLEN PRINTING AND WITH TOM BRANNON OF THE GPO OF ST. LOUIS IN JULY 1969, TO DISCUSS THE SUM DUE MCMULLEN PRINTING, AND A REVIEW OF MY NOTES INDICATES THAT AT THAT MEETING, THE GPO REPRESENTATIVE, IN CHECKING THE FILE AND THE NOTATIONS I HAD MADE THEREON, TOLD US THAT WHAT ACTUALLY HAPPENED WAS THAT THE GPO, NOTING THAT MCMULLEN PRINTING WAS CONSIDERABLY LOWER THAN THE OTHER BIDS, CALLED THE MCMULLEN ESTIMATOR, BY PHONE, AND ASKED HIM TO RECONFIRM MCMULLEN'S BIDS. THE MCMULLEN ESTIMATOR INDICATED IN THE PHONE CONVERSATION THAT THE FIGURES THE GPO HAD WERE THE FIGURES THAT MCMULLEN HAD QUOTED. AT NO TIME DID THE GPO REPRESENTATIVE TELL THE MCMULLEN ESTIMATOR THAT THERE WAS A VAST DIFFERENCE IN WHAT MCMULLEN HAD BID ON THE JOBS AND WHAT THE NEXT HIGHEST BIDDER HAD BID. AT NO TIME DID THE GPO REPRESENTATIVE INFORM MCMULLEN AS TO THE DOLLAR AMOUNTS OF THE NEXT LOWEST BID."

IN REGARD TO WHAT WAS SAID OVER THE TELEPHONE AT THE TIME MCMULLEN WAS REQUESTED TO VERIFY ITS BIDS, THE GOVERNMENT PRINTING OFFICE (GPO) HAS SUBMITTED AN AFFIDIVIT DATED JANUARY 28, 1970, EXECUTED BY MR. THOMAS P. BRANNON, OF THE GPO AT ST. LOUIS, MISSOURI, IN WHICH MR. BRANNON AVERS AS FOLLOWS:

"I, THOMAS P. BRANNON, BEING DULY SWORN (OR AFFIRMED) DEPOSES AND SAYS TO THE BEST OF MY KNOWLEDGE AND BELIEF:

"WE RECEIVED TWO BIDS ON 4 JOBS, THREE BIDS ON 6 JOBS AND FOUR BIDS ON 2 JOBS. ON JACKET 320-944, THREE BIDS WERE RECEIVED AND ONLY TWO ON 945, 947 AND 950.

"ON OCTOBER 2, 1968 I WAS OUT OF THE OFFICE ON OFFICIAL BUSINESS. MR. JOHN MCCALL CONDUCTED THE FORMAL PUBLIC BID OPENING AT 11:00 A.M. FOR THE TWELVE JACKETS IN QUESTION. SHORTLY AFTER THE OPENING, MCMULLEN PRINTING COMPANY OFFICIAL, MR. KEN HORAN, CALLED REQUESTING BID RESULTS. MR. MCCALL INFORMED HIM THAT MCMULLEN'S BIDS APPEARED TO BE EXTREMELY LOW AND REQUESTED HIM TO REVIEW AND CONFIRM HIS PRICES, WHICH HE DID.

"WHEN I RETURNED TO DUTY AT 8:00 A.M. ON OCTOBER 3, 1968, I IMMEDIATELY REVIEWED THE SITUATION AND CALLED MR. LOVELY AT MCMULLEN'S NEW ORLEANS, LOUISIANA BRANCH. I SPELLED OUT AND EXPLAINED TO HIM THE PRICE DIFFERENCE BETWEEN MCMULLEN'S BID AND THE OTHER BIDS ON EACH OF THE TWELVE JOBS. CALLED BACK WITHIN THE HOUR EXCLAIMING THEIR PRICES WERE FIRM, THAT THE LABOR MARKET WAS LESS IN THEIR AREA AND INSISTED I MAKE THE COPY AVAILABLE TO THEM AS SOON AS POSSIBLE BECAUSE THEY NEEDED THE WORK."

IT APPEARS FROM THE FOREGOING THAT THERE EXISTS A DISPUTE BETWEEN YOU AND MR. BRANNON AS TO WHAT WAS SAID BY REPRESENTATIVES OF THE GPO AT THE TIME REPRESENTATIVES OF MCMULLEN WERE REQUESTED OVER THE TELEPHONE TO VERIFY THEIR COMPANY'S BIDS. WHEN THERE IS A CONFLICT BETWEEN THE STATEMENT OF A CLAIMANT AND THE REPORT OF THE ADMINISTRATIVE OFFICE, IT IS A LONG- ESTABLISHED RULE OF THIS OFFICE TO ACCEPT THE LATTER IN THE ABSENCE OF EVIDENCE SUFFICIENTLY CONVINCING TO OVERCOME THE PRESUMPTION OF THE CORRECTNESS THEREOF. SEE 37 COMP. GEN. 568, 570 (1958).

IT IS YOUR CONTENTION THAT AT THE TIME MCMULLEN'S ESTIMATOR WAS REQUESTED BY THE GPO REPRESENTATIVE TO CONFIRM HIS COMPANY'S BIDS, HE WAS NOT TOLD THAT MCMULLEN'S BIDS WERE EXTREMELY LOW AND THAT HE WAS NOT GIVEN THE AMOUNTS OF ANY OF THE OTHER BIDS RECEIVED ON THE JOBS. YOU STATE THAT SINCE MCMULLEN WAS QUITE NEW TO THE BIDDING PROCEDURES ON THE GPO JOBS, AND THE GPO KNEW THIS, THAT AGENCY HAD A DUTY TO AT LEAST INFORM MCMULLEN THAT THEY WERE EXTREMELY LOW IN THEIR BIDS, PARTICULARLY SINCE THE SPECIFICATIONS WERE READ TO MCMULLEN OVER THE TELEPHONE.

SECTION 1-2.406-3 (D) (1) OF THE FEDERAL PROCUREMENT REGULATIONS (FPR) PROVIDES THAT WHENEVER THE CONTRACTING OFFICER SUSPECTS A MISTAKE IN BID, HE SHOULD IMMEDIATELY REQUEST VERIFICATION OF THE BID, SPECIFICALLY INFORMING "THE BIDDER WHY THE REQUEST FOR VERIFICATION IS MADE--THAT A MISTAKE IS SUSPECTED AND THE BASIS FOR SUCH SUSPICION; E.G; THAT THE BID IS SIGNIFICANTLY OUT OF LINE WITH THE NEXT LOW OR OTHER BIDS OR WITH THE GOVERNMENT'S ESTIMATE." IT IS REPORTED THAT SHORTLY AFTER THE BID OPENING ON OCTOBER 2, 1968, MR. KEN HORAN, MCMULLEN'S REPRESENTATIVE, TELEPHONED REQUESTING THE BID RESULTS; THAT MR. JOHN MCCALL, BID OPENING OFFICER, INFORMED MR. HORAN THAT HIS COMPANY'S BIDS ON THE VARIOUS JOBS APPEARED EXTREMELY LOW; THAT MR. HORAN WAS REQUESTED TO REVIEW AND CONFIRM HIS COMPANY'S BID PRICES; AND THAT LATER THAT SAME DAY MR. HORAN CALLED BACK AND STATED THAT HIS COMPANY'S BID PRICES WERE FIRM AND CORRECT.

ALTHOUGH MR. HORAN HAD CONFIRMED HIS COMPANY'S BID PRICES, THE CONTRACTING OFFICER, MR. THOMAS P. BRANNON, STILL SUSPECTED THAT SOME MISTAKES HAD BEEN MADE IN THE COMPANY'S BIDS AND, THEREFORE, HE CALLED MR. LOVELY AT THE COMPANY'S NEW ORLEANS, LOUISIANA, BRANCH. MR. BRANNON HAS STATED IN HIS AFFIDAVIT THAT AT THE TIME OF THE BID VERIFICATION, HE "SPELLED OUT AND EXPLAINED TO HIM (MR. LOVELY) THE PRICE DIFFERENCE BETWEEN MCMULLEN'S BID AND THE OTHER BIDS ON EACH OF THE TWELVE JOBS," AND THAT ABOUT AN HOUR LATER, MR. LOVELY CALLED BACK AND STATED THAT THE COMPANY'S PRICES WERE FIRM AND THAT MR. LOVELY INSISTED THAT THE COPY BE MADE AVAILABLE TO THE COMPANY AS SOON AS POSSIBLE AS IT NEEDED THE WORK. A VERIFICATION REQUEST REQUIRES NO SPECIAL LANGUAGE (47 COMP. GEN. 616 (1968)) AND IN OUR OPINION THE REQUEST FOR VERIFICATION IN THIS CASE SUBSTANTIALLY COMPLIED WITH THE CITED PARAGRAPH OF THE FPR AS WELL AS THE PREVIOUS DECISIONS OF THIS OFFICE. IN 37 COMP. GEN. 786, 788 (1958), WE STATED THE FOLLOWING CONCERNING A NEARLY IDENTICAL VERIFICATION REQUEST:

"THE RECORD ESTABLISHES THAT THE GOVERNMENT DID ALL THAT WAS REQUIRED OF IT TO ASCERTAIN THE CORRECTNESS OF FORWAY'S BID; IN FACT, FORWAY WAS SPECIFICALLY ADVISED THAT ITS BID WAS CONSIDERABLY LOWER THAN THE NEXT BID. IT WAS NOT UNTIL AFTER FORWAY UNEQUIVOCALLY CONFIRMED ITS BID THAT THE CONTRACTING OFFICER CONSIDERED IT CORRECT AND PROPER FOR AWARD. HAD THE CONTRACTING OFFICER THEREAFTER NOT AWARDED THE CONTRACT TO FORWAY AS THE LOWEST RESPONSIBLE BIDDER, HE WOULD HAVE BEEN DERELICT OF HIS DUTY TO THE GOVERNMENT. SEE CARNEGIE STEEL COMPANY V. CONNELLY, 97 A. 774; SHRIMPTON MFG. COMPANY V. BRIN, 125 S.W. 942; ALABAMA SHIRT & TROUSER COMPANY V. UNITED STATES, 121 C. CLS. 313. MOREOVER, THE FACTS OF RECORD PRECLUDE ANY ASSUMPTION OF BAD FAITH OR ARBITRARY ACTION ON THE PART OF THE CONTRACTING OFFICER. 27 COMP. GEN. 17."

WHILE YOU CITE OUR DECISION OF OCTOBER 14, 1969, B-167954, IN SUPPORT OF YOUR REQUEST FOR RELIEF, WE BELIEVE THAT THE FACTS IN THAT CASE ARE DISTINGUISHABLE FROM THE FACTS IN THE PRESENT CASE. THE DECISION IN THAT CASE WAS BASED ON THE FACT THAT THE VERIFICATION BY THE BIDDER WAS CONDITIONED ON A SUPPLIER'S QUOTATION BEING CORRECT. ALSO, AN ADDITIONAL FACT IN THE PRESENT CASE IS THAT MCMULLEN WAS REQUESTED ON TWO OCCASIONS TO VERIFY ITS BIDS, WHEREAS IN THE CASE CITED BY YOU THERE WAS ONLY ONE REQUEST FOR VERIFICATION.

IT IS OUR POSITION THAT AFTER THE SECOND UNEQUIVOCAL VERIFICATION OF THE BIDS, THE CONTRACTING OFFICER WAS NOT ONLY JUSTIFIED IN AWARDING THE CONTRACTS ON MCMULLEN'S BIDS AS THE LOWEST RECEIVED ON EACH JOB, BUT WOULD HAVE FAILED IN HIS DUTY HAD HE DONE OTHERWISE. WE BELIEVE THAT THE GOVERNMENT DID ALL THAT WAS REQUIRED OF IT TO ASCERTAIN THE CORRECTNESS OF MCMULLEN'S BIDS. SEE 36 COMP. GEN. 27 (1956) AND 47 ID. 616 (1968).

IN REGARD TO YOUR STATEMENT THAT THE CONTRACTING OFFICER, MR. THOMAS P. BRANNON, ADVISED MCMULLEN'S REPRESENTATIVE THAT IF THE COMPANY PROMPTLY PROCEEDED WITH THE COMPLETION OF THE JOBS THE GPO WOULD HONOR THE PAYMENT OF ANY ADDITIONAL COSTS INCURRED BY THE COMPANY, THE GPO INFORMALLY ADVISED OUR OFFICE THAT MR. BRANNON HAS STATED THAT HE TOLD MCMULLEN'S REPRESENTATIVE THAT THE COMPANY COULD APPEAL TO THE PUBLIC PRINTER FOR RELIEF UP TO THE AMOUNT OF THE NEXT LOWEST BID ON EACH JOB UNDER THE PROVISIONS OF ARTICLE 29 - DISPUTES - OF THE UNITED STATES GOVERNMENT PRINTING OFFICE CONTRACT TERMS NO. 1, WHICH WAS MADE PART OF EACH CONTRACT. HOWEVER, ANY ADMINISTRATIVE DECISION REACHED UNDER THAT PROVISION WOULD NOT HAVE BEEN FINAL BETWEEN THE PARTIES SINCE SUCH DECISIONS WOULD HAVE INVOLVED QUESTIONS OF LAW WHICH ARE NOT FINAL UNDER THE DISPUTES PROCEDURES.

THE FACT THAT MCMULLEN MAY HAVE BEEN INDUCED THROUGH STATEMENTS MADE BY AN OFFICER OR EMPLOYEE OF THE GOVERNMENT TO PERFORM THE JOBS IN THE HOPE OR BELIEF THAT IT WOULD BE PAID SOME AMOUNT IN ADDITION TO THE BID PRICES DOES NOT AFFECT THE LEGAL RIGHTS OR OBLIGATIONS FIXED BY THE CONTRACTS. THE COMPANY, IN PERFORMING THE JOBS, DID NO MORE THAN IT WAS OBLIGATED TO DO UNDER ITS ACCEPTED BIDS. SEE 17 COMP. GEN. 452 (1937), AND WILLARD, SUTHERLAND & COMPANY V. UNITED STATES, 262 U.S. 489 (1923).

ACCORDINGLY, UPON REVIEW, OUR DECISION OF MARCH 26, 1969, B-166191 ET AL; IS AFFIRMED.