B-150904, MAY 24, 1963

B-150904: May 24, 1963

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INC.: REFERENCE IS MADE TO THE TELEGRAM OF APRIL 16. THE REFERRED-TO DETERMINATION WAS RENDERED PURSUANT TO THE PROVISIONS OF PARAGRAPH 2-406.3 OF THE ARMED SERVICES PROCUREMENT REGULATION (ASPR). IF THE EVIDENCE IS CLEAR AND CONVINCING BOTH AS TO THE EXISTENCE OF THE MISTAKE AND AS TO THE BID ACTUALLY INTENDED. IS THE LOWEST RECEIVED. THE DETERMINATION SHALL NOT BE MADE UNLESS THE EXISTENCE OF THE MISTAKE AND THE BID ACTUALLY INTENDED ARE ASCERTAINABLE SUBSTANTIALLY FROM THE INVITATION AND THE BID ITSELF. IF THE EVIDENCE IS CLEAR AND CONVINCING ONLY AS TO THE MISTAKE. WAS AUTHORIZED. ALL ITEMS TO BE AWARDED AS A UNIT AND THE TOTAL PRICE SUBMITTED FOR ALL ITEMS WAS TO BE USED FOR EVALUATION OF BIDS RATHER THAN THE PRICE OF INDIVIDUAL ITEMS.

B-150904, MAY 24, 1963

TO ARKAY INTERNATIONAL, INC.:

REFERENCE IS MADE TO THE TELEGRAM OF APRIL 16, 1963, FROM YOUR ATTORNEY, PROTESTING THE DETERMINATION OF THE GENERAL COUNSEL, UNITED STATES ARMY MATERIEL COMMAND, TO PERMIT WITHDRAWAL BUT NOT CORRECTION OF YOUR BID SUBMITTED IN RESPONSE TO INVITATION FOR BIDS NO. AMC-36-039 63-246-A1, ISSUED BY THE UNITED STATES ARMY ELECTRONICS MATERIEL AGENCY.

THE REFERRED-TO DETERMINATION WAS RENDERED PURSUANT TO THE PROVISIONS OF PARAGRAPH 2-406.3 OF THE ARMED SERVICES PROCUREMENT REGULATION (ASPR). SAID PARAGRAPH PROVIDES IN SUBPARAGRAPHS (A) (1), (A) (2) AND (A) (3) THAT IN CASES OF MISTAKES IN BIDS, OTHER THAN APPARENT CLERICAL MISTAKES, ALLEGED AFTER OPENING OF BIDS AND PRIOR TO AWARD THE DEPARTMENTS MAY MAKE THE FOLLOWING DETERMINATIONS:

"/1) WHERE THE BIDDER REQUESTS PERMISSION TO WITHDRAW A BID AND CLEAR AND CONVINCING EVIDENCE ESTABLISHES THE EXISTENCE OF A MISTAKE, A DETERMINATION PERMITTING THE BIDDER TO WITHDRAW HIS BID MAY BE MADE.

"/2) HOWEVER, IF THE EVIDENCE IS CLEAR AND CONVINCING BOTH AS TO THE EXISTENCE OF THE MISTAKE AND AS TO THE BID ACTUALLY INTENDED, AND IF THE BID, BOTH AS UNCORRECTED AND AS CORRECTED, IS THE LOWEST RECEIVED, A DETERMINATION MAY BE MADE TO CORRECT THE BID AND NOT PERMIT ITS WITHDRAWAL.

"/3) WHERE THE BIDDER REQUESTS PERMISSION TO CORRECT A MISTAKE IN HIS BID AND CLEAR AND CONVINCING EVIDENCE ESTABLISHES BOTH THE EXISTENCE OF A MISTAKE AND THE BID ACTUALLY INTENDED, A DETERMINATION PERMITTING THE BIDDER TO CORRECT THE MISTAKE MAY BE MADE; PROVIDED THAT, IN THE EVENT SUCH CORRECTION WOULD RESULT IN DISPLACING ONE OR MORE LOWER BIDS, THE DETERMINATION SHALL NOT BE MADE UNLESS THE EXISTENCE OF THE MISTAKE AND THE BID ACTUALLY INTENDED ARE ASCERTAINABLE SUBSTANTIALLY FROM THE INVITATION AND THE BID ITSELF. IF THE EVIDENCE IS CLEAR AND CONVINCING ONLY AS TO THE MISTAKE, BUT NOT AS TO THE INTENDED BID, A DETERMINATION PERMITTING THE BIDDER TO WITHDRAW HIS BID MAY BE MADE.'

THE GENERAL COUNSEL, UNITED STATES ARMY MATERIEL COMMAND, PURSUANT TO AUTHORITY DELEGATED TO HIM UNDER SUBPARAGRAPH (B) (1) OF ASPR 2-406.3, HAS DECIDED THAT THE INFORMATION SUBMITTED IN SUPPORT OF YOUR REQUEST FOR CORRECTION CONSTITUTED CLEAR AND CONVINCING EVIDENCE OF A MISTAKE IN BID BUT NOT OF THE BID ACTUALLY INTENDED. WITHDRAWAL, BUT NOT CORRECTION, WAS AUTHORIZED.

THE CITED INVITATION SOLICITED BIDS--- TO BE OPENED ON NOVEMBER 30, 1962- -- FOR FURNISHING ONE ITEM OF ANTENNA (5,887 EACH) AND FOUR ANCILLARY ITEMS, ALL ITEMS TO BE AWARDED AS A UNIT AND THE TOTAL PRICE SUBMITTED FOR ALL ITEMS WAS TO BE USED FOR EVALUATION OF BIDS RATHER THAN THE PRICE OF INDIVIDUAL ITEMS. BIDS WERE SOLICITED UNDER A PARTIAL SET-ASIDE FOR LABOR SURPLUS AREAS. ELEVEN BIDS WERE RECEIVED. YOUR BID ON AN OVER-ALL BASIS WAS $1,199,197.27. THE SECOND LOW BID WAS IN THE AMOUNT OF $1,538,189.89. AFTER A REVIEW OF THE BIDS BY THE CONTRACTING OFFICER YOUR COMPANY WAS REQUESTED ON NOVEMBER 30 TO CONFIRM ITS PRICE. MR. MAX REIN OF YOUR FIRM ADVISED THAT HE WOULD RECHECK YOUR QUOTATION. ON DECEMBER 6, 1962, MR. REIN WAS FURTHER CONTACTED BY TELEPHONE AND HE ADVISED THAT HE WAS SENDING AS OF THAT DATE A LETTER CONFIRMING THE PRICES YOUR FIRM HAD QUOTED. HOWEVER, SINCE NO REPLY WAS RECEIVED MR. REIN WAS CONTACTED AGAIN ON DECEMBER 11 AND HE THEN ADVISED THAT A TELETYPE WAS SENT ON DECEMBER 10 ALLEGING A MISTAKE IN BID. YOU REQUESTED THAT THE UNIT PRICE OF $199.97 QUOTED FOR ANTENNA (ITEM 1) BE INCREASED BY $50 OR THAT THE PRICE SHOULD HAVE BEEN SHOWN AS $249.97. YOU STATED THAT A SECRETARY HAD FAILED TO INCLUDE THE AMOUNT OF $37 AS THE QUOTED COST OF THE ANTENNA BASE WHEN SHE TOTALED THE PRICES OF THE COMPONENTS AND PARTS ON A TAPE. UPON THE REQUEST OF THE CONTRACTING OFFICER YOUR FIRM FURTHER EXPLAINED THAT "G AND A" AND "PROFIT" SHOULD BE ADDED AT THE RATES OF 25 PERCENT AND 7 PERCENT, RESPECTIVELY, RESULTING IN A FIGURE OF $49.49, RATHER THAN $50, WHICH WHEN ADDED TO THE UNIT PRICE OF $199.97 QUOTED IN YOUR BID RESULTS IN A TOTAL OF $249.46 RATHER THAN $249.97. ON DECEMBER 27, 1962, YOUR FIRM WAS ADVISED BY TELEPHONE THAT ADDITIONAL DATA WAS REQUIRED. SUCH ADDITIONAL DATA WAS FURNISHED WITH YOUR LETTERS OF JANUARY 2 AND 3, 1963.

THE DATA FURNISHED BY YOU SHOWS "PENCILED" FIGURES ON YOUR DRAWING AND DATA LIST WHICH AGREE WITH THE FIGURES ON THE ADDING MACHINE TAPE, EXCEPT AS TO ONE ITEM OF $3.75 WHICH IS SHOWN ON THE TAPE AS $3.79 AND THE OMISSION OF THE ITEMS OF $9.68 AND $19.62 ON THE DRAWING AND DATA LIST. THE SUBTOTAL OF THE COST OF THE COMPONENTS IS SHOWN AS $129.92 TO WHICH ARE ADDED THE ITEMS OF $18, $2 AND $0.50 FOR "LABOR, PACK AND PACK EXTRA" OR A TOTAL OF $150.42. THEN THERE IS ADDED THE AMOUNT OF $37.60 FOR G AND A AND THE AMOUNT OF $13.16 FOR PROFIT AND THE TOTAL SHOWN AS $201.18. THE AMOUNT OF $1.21 IS THEN ARBITRARILY DROPPED AND THE FIGURE OF $199.97 IS SUBSTITUTED. WITH REGARD TO THE QUOTATIONS OF $9.68 AND $19.62 RECEIVED FROM COLUMBIA PRODUCTS COMPANY, IT IS NOTED THAT IN ITS LETTER OF DECEMBER 10, 1962, COLUMBIA STATES THAT IT BID ON THREE ITEMS WITH UNIT PRICES OF $9.68 AND $19.62 ON TWO DIFFERENT ANTENNA ELEMENTS AND $43.85 FOR THE ANTENNA BASE, WITH A CONDITION THAT THE QUOTATION WAS BASED ON "RECEIPT OF ORDER FOR ALL THREE PARTS, NOT PARTIAL.' YOU STATE THAT THIS CONDITION WAS NOT ATTACHED TO YOUR VERBAL QUOTATION FROM THIS FIRM RECEIVED PRIOR TO THE CONFIRMATION LETTER OF DECEMBER 10. THE AMOUNTS OF $9.68 AND $19.62 APPEAR ON THE ADDING MACHINE TAPE. HOWEVER, YOU STATE THAT THE OMITTED COST OF THE ANTENNA BASE ($37) INSTEAD OF $43.85 WAS THAT QUOTED BY GENERAL COIL PRODUCTS CORPORATION IN ITS LETTER OF NOVEMBER 14, 1962. THE ADMINISTRATIVE OFFICE REPORTS THAT THERE IS NO INDICATION IN YOUR WORKSHEETS THAT COSTS FOR PREPRODUCTION SAMPLE EVALUATION AND APPROVAL, FOR TEST AND INSPECTION OF THE PRODUCTION QUANTITIES, FOR CHECKING GOVERNMENT-FURNISHED DRAWINGS, FOR INCOMING INSPECTION AND HANDLING, AND FOR NOMENCLATURE AND STOCK NUMBER ASSIGNMENT AND MARKING WERE CONSIDERED IN THE CALCULATION OF YOUR BID. WHEN YOU WERE INFORMED OF THIS MATTER YOU SUBMITTED AN AFFIDAVIT STATING THAT THESE COSTS WERE GROUPED INTO THE G AND A AND LABOR FIGURES AND THAT THIS PATTERN IS INCORPORATED INTO ALL YOUR BIDDING PROCEDURES.

CONSIDERING THE MATTER OF THE OMITTED ITEM OF $37 FURTHER, THIS FIGURE WHEN ADDED TO THE TOTAL OF $150.42 SHOWN ON THE TAPE FOR MATERIALS, LABOR, PACKING AND EXTRAS RESULTS IN A FIGURE OF $187.42, WHICH, WITH A 25 PERCENT G AND A FACTOR AND A 7 PERCENT PROFIT FACTOR, RESULTS IN A TOTAL OF $250.68. IN ORDER TO ARRIVE AT THE INTENDED BID PRICE, THE AMOUNT OF $1.21 MUST BE DROPPED. IN ORDER TO ESTABLISH THAT THE FIGURE OF $37 WAS THE COST OF THE ANTENNA BASE TO BE INCLUDED, THE STATEMENT OF COLUMBIA PRODUCTS THAT ITS QUOTATION IS BASED ONLY ON AN ORDER FOR ALL THREE PARTS MUST BE DISREGARDED. FINALLY, ALTHOUGH YOU STATED THAT THE COSTS OF PREPRODUCTION SAMPLE EVALUATION AND OTHER COSTS FOR WORK REQUIRED BY THIS PROCUREMENT ARE INCLUDED IN THE G AND A AND LABOR FIGURES, THE GENERAL COUNSEL, UNITED STATES ARMY MATERIEL COMMAND, FOUND IN HIS MEMORANDUM OF APRIL 11, 1963, THAT NO SUPPORT FOR THIS IS FOUND IN THE WORKSHEETS.

THE STATUTES REQUIRING ADVERTISING FOR BIDS AND THE AWARD OF CONTRACTS TO THE LOWEST RESPONSIBLE BIDDERS ARE FOR THE BENEFIT OF THE UNITED STATES IN SECURING BOTH FREE COMPETITION AND THE LOWEST COMPETITIVE PRICES. CERTAIN CASES WHERE A MISTAKE HAS BEEN ALLEGED PROMPTLY AFTER OPENING OF BIDS AND BEFORE AWARD OF THE CONTRACT AND THERE HAS BEEN A TIMELY PRESENTATION OF CONVINCING EVIDENCE THAT A MISTAKE WAS MADE, ITS NATURE, HOW IT OCCURRED AND WHAT THE PRICE WOULD HAVE BEEN EXCEPT FOR THE MISTAKE, OUR OFFICE HAS PERMITTED THE BID TO BE CORRECTED. 37 COMP. GEN. 210. SOME CASES, THE EVIDENCE SUBMITTED MAY BE CONVINCING TO SHOW THAT A MISTAKE IN A BID HAS BEEN MADE AND THE BIDDER MAY BE PERMITTED TO WITHDRAW HIS BID. HOWEVER, IN ORDER TO PRESERVE THE RIGHTS OF OTHER BIDDERS, WHEN A BID IS CONSIDERED FOR CORRECTION THERE MUST BE CONVINCING EVIDENCE AS TO WHAT THE BID WOULD HAVE BEEN BUT FOR THE MISTAKE. THE WEIGHT TO BE GIVEN EVIDENCE SUBMITTED IN SUPPORT OF A REQUESTED CORRECTION OF A BID PRIMARILY IS A QUESTION OF FACT TO BE CONSIDERED BY THE EVALUATOR AUTHORIZED BY THE REGULATIONS TO MAKE SUCH DETERMINATIONS, IN THIS CASE THE GENERAL COUNSEL, UNITED STATES ARMY MATERIEL COMMAND. IN VIEW OF THE FACTS OF RECORD IT IS OUR VIEW THAT YOU HAVE NOT SUBMITTED CLEAR AND CONVINCING EVIDENCE AS TO WHAT YOU WOULD HAVE BID BUT FOR THE ERROR.

ACCORDINGLY, WE FIND NO BASIS FOR DISAGREEING WITH THE ADMINISTRATIVE DETERMINATION TO REFUSE CORRECTION OF YOUR BID.

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