B-150086, OCT. 26, 1962

B-150086, OCT. 26, 1962

TO ADMINISTRATOR, GENERAL SERVICES ADMINISTRATION:

REFERENCE IS MADE TO YOUR LETTER DATED OCTOBER 9, 1962, WITH ENCLOSURES, REQUESTING OUR DECISION AS TO THE APPROPRIATE ACTION TO BE TAKEN IN REGARD TO CONTRACT NO. GS-07B-0018-/DC), DATED AUGUST 15, 1962, WHICH WAS AWARDED BY THE GENERAL SERVICES ADMINISTRATION TO I. W. HAVARD, CANTON, MISSISSIPPI.

IN RESPONSE TO AN INVITATION COVERING PROJECT NO. 4901-2092, ISSUED ON MAY 23, 1962, BY THE GENERAL SERVICES ADMINISTRATION, REGION 7,DALLAS, TEXAS, I. W. HAVARD SUBMITTED A BID DATED JUNE 18, 1962, OFFERING TO PERFORM ALL WORK FOR THE AIR CONDITIONING AND MODERNIZATION OF THE UNITED STATES POST OFFICE AND COURT HOUSE, EL DORADO, ARKANSAS, FOR AN AMENDED TOTAL PRICE OF $327,400. FIVE OTHER BIDS WERE RECEIVED RANGING FROM $368,300 TO $494,800 AND THE GOVERNMENT'S ESTIMATE FOR THE PROJECT WAS $325,000. FOUR DAYS AFTER BIDS WERE OPENED I. W. HAVARD, THE LOW BIDDER, BY LETTER DATED JUNE 25, 1962, ADVISED THE GENERAL SERVICES ADMINISTRATION THAT AN ERROR HAD BEEN MADE IN HIS BID IN THAT THE AMOUNT OF $53,700 INCLUDED IN THE BID FOR THE ELECTRICAL WORK SHOULD HAVE BEEN $109,892 AND, IN VIEW OF THE ERROR, MR. HAVARD REQUESTED THAT HE BE PERMITTED TO WITHDRAW HIS BID. AN INVESTIGATION OF THE ALLEGED ERROR WAS MADE AND BASED UPON THE REPORT IT WAS CONCLUDED THAT CLEAR AND CONVINCING EVIDENCE THEREOF HAD NOT BEEN FURNISHED. IN VIEW OF THIS, AN AWARD WAS MADE TO I. W. HAVARD ON AUGUST 15, 1962, AND A FORMAL CONTRACT WAS EXECUTED BY HIM AND THE GENERAL SERVICES ADMINISTRATION ON THAT DATE. SUBSEQUENTLY, SHAPIRO AND MAYER, BY LETTER DATED AUGUST 27, 1962, REQUESTED, IN BEHALF OF I. W. HAVARD, THAT THE CONTRACT AMOUNT BE INCREASED BY $12,420 TO COVER ARITHMETICAL ERRORS THAT WERE CLEAR ON THE FACE OF MR. HAVARD'S WORKSHEETS; ALSO, THAT THE CONTRACT BE AMENDED TO INCLUDE ADDITIONAL AMOUNTS COVERING OTHER ITEMS FOR WHICH, BY REASON OF OTHER ERRORS, NO COST FIGURES WERE INCLUDED IN THE BID.

WITH RESPECT TO THE ALLEGED ERROR IN OMITTING SOME OF THE COST FOR THE ELECTRICAL WORK, AS STATED IN YOUR SUBMISSION THERE IS NO CLEAR AND CONVINCING EVIDENCE IN THE RECORD TO ESTABLISH THAT SUCH AN ERROR HAD, IN FACT, BEEN MADE IN THE BID. MOREOVER, THIS DETERMINATION APPEARS TO BE COMPLETELY CONFIRMED BY THE DETAILED INVESTIGATION WHICH WAS CONDUCTED BY A SPECIAL AGENT IN CHARGE OF THE DALLAS FIELD OFFICE OF THE GENERAL SERVICES ADMINISTRATION THAT ALSO FAILED TO ADDUCE SUBSTANTIATING EVIDENCE OF THE ERROR. IN ADDITION, I. W. HAVARD ADMITTED TO THE SPECIAL AGENT THAT HE DID NOT HAVE A BID FOR THE ELECTRICAL WORK ON THE PROJECT AND THAT THE AMOUNT OF $53,700 INCLUDED IN HIS BID FOR THIS WORK WAS MERELY AN AMOUNT THAT WAS MORE OR LESS SELECTED AT RANDOM. IT IS ALSO NOTED THAT I. W. HAVARD'S BID WAS $2,400 MORE THAN THE GOVERNMENT'S ESTIMATE AND ONLY $40,900 LOWER THAN THE NEXT LOW BID. IN VIEW OF THESE CIRCUMSTANCES, AND SINCE IT IS THE GENERAL RULE THAT PROPOSALS WHICH HAVE BEEN SUBMITTED IN RESPONSE TO AN ADVERTISEMENT FOR BIDS MAY NOT BE WITHDRAWN AFTER THEY HAVE BEEN OPENED, EVEN BEFORE AWARD IS MADE, AND THAT THE BIDDER IS BOUND TO ACCEPT AWARD, THE ACTION TAKEN IN AWARDING CONTRACT NO. GS-07B-0018 /DC) TO I. W. HAVARD, WHO LATER EXECUTED THE FORMAL CONTRACT DOCUMENTS, WAS PROPER. SEE 29 COMP. GEN. 341, 342; 19 ID. 761 AND CASES CITED THEREIN.

IN REGARD TO THE INCREASED AMOUNT OF $12,420 CLAIMED BY REASON OF CERTAIN ARITHMETICAL ERRORS ALLEGEDLY MADE IN THE BID OF I. W. HAVARD AND OTHER ADDITIONAL AMOUNTS FOR WHICH NO COST FIGURES HAD BEEN INCLUDED IN THE BID, THE PROPRIETY OF THE ALLOWANCE OF ANY SUCH AMOUNTS WOULD HAVE TO BE DETERMINED SOLELY ON THE BASIS OF WHETHER OR NOT THERE WAS CONSTRUCTIVE NOTICE OF SUCH ERRORS TO THE GOVERNMENT CONTRACTING OFFICER PRIOR TO AWARD SINCE NO ACTUAL NOTICE OF THESE ERRORS WAS GIVEN BY MR. HAVARD WHEN HE FIRST ALLEGED THE ERROR IN HIS BID AS TO THE ELECTRICAL COST. THE RECORD IS COMPLETELY DEVOID OF ANY CIRCUMSTANCES THAT WOULD CONSTITUTE CONSTRUCTIVE NOTICE TO THE CONTRACTING OFFICER OF THE PROBABILITY OF SUCH ERRORS PRIOR TO AWARD. THIS BEING THE CASE IT MUST BE CONCLUDED THAT THE ACCEPTANCE OF THE BID UNDER THE CIRCUMSTANCES INVOLVED WAS MADE IN GOOD FAITH AND THAT SUCH AN ACCEPTANCE CREATED A VALID AND BINDING CONTRACT WHICH FIXED THE RIGHTS AND LIABILITIES OF THE PARTIES.

ACCORDINGLY, WE FIND NO LEGAL BASIS FOR AUTHORIZING A REFORMATION OF CONTRACT NO. GS-07B-0018-/DC).

THE PAPERS FURNISHED WITH YOUR LETTER OF OCTOBER 9, 1962, ARE RETURNED HEREWITH, AS REQUESTED.