B-174592, FEB 10, 1972, 51 COMP GEN 498

B-174592, FEB 10, 1972, 51 COMP GEN 498

BIDS - MISTAKES - VERIFICATION - ACCEPTANCE OF BID UNWARRANTED EVEN THOUGH THE OBVIOUS ERROR OF QUOTING A TWO-COLOR PRINTING JOB AT ONE- THIRD THE PRICE OF THE SAME JOB PRINTING IN ONE COLOR IN RESPONSE TO AN INVITATION FOR PRINTING A WEEKLY NEWSPAPER FOR THE NAVAL WEAPONS CENTER, CHINA LAKE, CALIFORNIA, WAS VERIFIED AS CORRECT BY THE LOW BIDDER, THE BID SHOULD NOT HAVE BEEN ACCEPTED FOR ACCEPTANCE GAVE THE OSTENSIBLE LOW BIDDER AN OPTION TO WITHDRAW ITS BID, REQUEST A BID CORRECTION, OR INSIST UPON THE CORRECTNESS OF ITS BID DESPITE THE RIDICULOUSLY LOW PRICE QUOTED ON THE TWO-COLOR JOB, AND THE PRESERVATION OF FAIRNESS IN THE COMPETITIVE SYSTEM PRECLUDES GIVING A BIDDER THE RIGHT TO MAKE SUCH AN ELECTION AFTER THE RESULTS OF THE BIDDING ARE KNOWN. ALTHOUGH CORRECTION OF THE ERRONEOUS ITEM DISPLACED THE LOW BID, SINCE THE ONLY OTHER BIDDER WAS NONRESPONSIVE, THE DIRECTED CANCELLATION WAS WITHDRAWN IN B-174592, APRIL 27, 1972, AS BEING IN THE BEST INTERESTS OF THE GOVERNMENT.

TO THE SECRETARY OF THE NAVY, FEBRUARY 10, 1972:

REFERENCE IS MADE TO THE LETTER OF DECEMBER 28, 1971, FROM THE DEPUTY COMMANDER, PROCUREMENT MANAGEMENT, NAVAL SUPPLY SYSTEMS COMMAND, SUP 0222, REGARDING THE PROTEST OF AN AWARD OF A CONTRACT TO HUBBARD PRINTING, INCORPORATED, UNDER SOLICITATION NO. N00123-72-B-0113, ISSUED BY THE NAVAL REGIONAL PROCUREMENT OFFICE, LOS ANGELES, CALIFORNIA.

THE INVITATION WAS FOR THE PRINTING OF A WEEKLY NEWSPAPER FOR THE NAVAL WEAPONS CENTER, CHINA LAKE, CALIFORNIA, FOR A PERIOD OF 3 YEARS. THE FIRST SIX ITEMS OF THE IFB WERE FOR PRINTING IN BLACK OR ONE COLOR ONLY. THE NEXT SEVERAL ITEMS WERE FOR PRINTING WITH AN ADDITIONAL COLOR, AND APPEARED UNDER THE FOLLOWING STATEMENT:

PRINT WITH ONE ADDITIONAL COLOR INK BY PAGE UNITS. A MAXIMUM OF THREE (3) TWO-COLOR INK ISSUES MAY BE PRINTED PER YEAR.

TWO BIDS WERE RECEIVED, ONE FROM HUBBARD, AND ONE FROM SPEEDPRINTERS. HUBBARD'S BID PRICES FOR THE TWO-COLOR PRINTING ITEMS WERE SIGNIFICANTLY LOWER THAN SPEEDPRINTERS', AND WERE ALSO LOWER THAN ITS PRICES FOR ONE COLOR PRINTING. FOR EXAMPLE, HUBBARD'S BID FOR A FOUR-PAGE EDITION WAS $457.50 IN ONE COLOR AND ONLY $150 IN TWO COLORS. BECAUSE OF THIS DISPARITY, THE CONTRACTING OFFICER ASKED HUBBARD TO VERIFY ITS BID. HUBBARD DID SO, AND ALSO REDUCED ITS PRICES FOR CERTAIN ITEMS, THEREBY REDUCING ITS OVERALL BID. THE CONTRACTING OFFICER EVALUATED THE SPEEDPRINTERS BID AT $98,107.40; HUBBARD'S BID WAS EVALUATED AT $93,906.56 PRIOR TO VERIFICATION AND AT $92,626.66 AFTER VERIFICATION AND PRICE REDUCTION. AWARD WAS THEN MADE TO HUBBARD, AND SPEEDPRINTERS FILED ITS PROTEST.

SPEEDPRINTERS CLAIMS THAT THE CONTRACTING OFFICER INCORRECTLY INTERPRETED HUBBARD'S BID IN THAT HUBBARD'S BIDS FOR THE TWO-COLOR ITEMS ARE MEANT AS ADDITIONAL CHARGES TO THE BASIC BIDS ENTERED FOR THE ONE-COLOR ITEMS, AND NOT AS THE TOTAL BID PRICE FOR THE ITEMS. USING THE EXAMPLE MENTIONED ABOVE, THE PROTESTOR ALLEGES THAT HUBBARD'S ACTUAL BID FOR A FOUR-PAGE EDITION IS $457.50 PLUS $150, OR $607.50, AND SHOULD HAVE BEEN SO EVALUATED. SPEEDPRINTERS STATES THAT IT IS UNREASONABLE FOR A ONE-COLOR EDITION TO BE BID AT $457.50 AND A TWO COLOR EDITION AT A MUCH LOWER FIGURE.

IN THIS RESPECT, THE ADMINISTRATIVE REPORT INDICATES THAT PREVIOUS SOLICITATION FOR THESE PRINTING SERVICES DID ASK ONLY FOR AN "ADDITIONAL CHARGE FOR SECOND COLOR," AND THAT HUBBARD WAS THE SUCCESSFUL BIDDER ON THAT IFB.

WE AGREED THAT IT IS NOT REASONABLE TO EXPECT A TWO-COLOR PRINTING JOB TO COST ONLY ONE-THIRD THE PRICE OF THE SAME JOB PRINTED IN ONE COLOR, AND WE THINK THE WORDING IN THE EARLIER SOLICITATION SUPPORTS THE VIEW THAT HUBBARD PROBABLY ENTERED ITS BIDS IN THE NEW SOLICITATION ON THE BASIS OF THE WORDING IN THE EARLIER ONE. THIS WAS AN OBVIOUS ERROR ON THE FACE OF THE BID, AND THE CONTRACTING OFFICER WOULD HAVE BEEN REMISS HAD HE NOT SOUGHT VERIFICATION. UNDER THESE CIRCUMSTANCES, HOWEVER, IT DOES NOT FOLLOW THAT THE BID, EVEN AFTER VERIFICATION, MAY BE ACCEPTED.

IN 39 COMP. GEN. 185 (1959), WE HELD THAT AN OBVIOUSLY ERRONEOUS BID CANNOT BE ACCEPTED AS THE INTENDED BID ALTHOUGH THE BID PRICE IS VERIFIED AFTER OPENING. WE NOTED THAT ANY OTHER VIEW WOULD GIVE THE OSTENSIBLE LOW BIDDER AN OPTION TO EITHER WITHDRAW ITS BID, REQUEST A CORRECTION IN ITS BID, OR INSIST UPON THE CORRECTNESS OF ITS BID DESPITE RIDICULOUSLY LOW PRICES. WE STATED AT PAGE 187 THAT "THE COMPETITIVE BIDDING SYSTEM WOULD BE ADVERSELY AFFECTED BY CONSIDERING SUCH EXTREMELY LOW UNIT PRICES IN THE ABSENCE OF CONVINCING EVIDENCE THAT THE BID AS SUBMITTED WAS AS ORIGINALLY INTENDED."

IN B-147397, OCTOBER 24, 1961, WE CONSIDERED A SITUATION VERY SIMILAR TO THE INSTANT CASE. THE SOLICITATION THERE WAS FOR THE CONSTRUCTING AND LEASING OF POSTAL FACILITIES AND CALLED FOR BIDDERS TO QUOTE AN ANNUAL RENTAL ON THE BASIS OF BOTH MAINTENANCE OF THE PREMISES AS A GOVERNMENT OBLIGATION AND MAINTENANCE AS AN OBLIGATION OF THE LESSOR. THE APPARENT LOW BIDDER ON THE BASIS OF LESSOR MAINTENANCE QUOTED A RENTAL THAT WAS $210,000 LESS FOR LESSOR MAINTENANCE THAN FOR GOVERNMENT MAINTENANCE. AFTER OPENING, THE BIDDER FIRST ALLEGED THAT THE TWO BIDS WERE REVERSED. FOUR DAYS LATER, THE BIDDER CLAIMED THE AMOUNT BID FOR LESSOR MAINTENANCE WAS CORRECT AND THAT ONLY THE QUOTATION FOR GOVERNMENT MAINTENANCE WAS INCORRECT. HAD THE BIDS BEEN REVERSED, NEITHER WOULD HAVE BEEN LOW. STATED THAT:

THE BIDDER HAS PLACED HIMSELF IN A POSITION, WHETHER INTENTIONALLY OR NOT, WHERE AFTER THE OPENING OF THE BIDS HE HAD THE OPTION OF REQUESTING THAT THE BID PRICES ON THE TWO SCHEDULES BE REVERSED WHICH THE GOVERNMENT, UNDER THE CIRCUMSTANCES, COULD HARDLY HAVE LOGICALLY DENIED, OR CLAIMING THAT THE PRICES SHOWN ON EITHER ONE OF THE TWO SCHEDULES WAS CORRECT AND THE OTHER WAS ERRONEOUS. A BIDDER MAY NOT BE PERMITTED TO STAND ON ITS APPARENTLY ERRONEOUS BID AND MAKE A CONTRACT TO WHICH IT WOULD NOT HAVE BEEN ENTITLED BUT FOR THE ERROR. THE PRESERVATION OF FAIRNESS IN THE COMPETITIVE BID SYSTEM PRECLUDES GIVING A BIDDER THE RIGHT TO MAKE SUCH AN ELECTION AFTER THE RESULTS OF THE BIDDING ARE KNOWN. 35 COMP. GEN. 33; 37 ID. 579; AND 39 ID. 185.

WE ADVISED THAT BOTH BIDS SHOULD BE DISREGARDED.

WE THINK THESE CASES ARE CONTROLLING IN THIS PROCUREMENT. BECAUSE OF THE OBVIOUS ERROR IN ITS BID, HUBBARD PLAINLY HAD A CHOICE OF CLAIMING ITS TWO -COLOR QUOTATIONS WERE MISINTERPRETED OR THAT THE ABSURDLY LOW BID WAS ACTUALLY CORRECT. WHILE IT STATES, IN ITS DECEMBER 14, 1971 LETTER TO THE CONTRACTING OFFICER, THAT ITS BID WAS CORRECT AS SUBMITTED, THE ONLY EVIDENCE OFFERED IS ITS STATEMENT THAT IN SUBMITTING THE BID, IT "TOOK INTO CONSIDERATION THE LENGTHY RELATIONSHIP WE HAVE HAD WITH THE NWC NEWSPAPER AND THE FACT THAT COLOR WAS ONLY CALLED FOR THREE TIMES A YEAR." IN OUR VIEW, THIS FAILS TO CONVINCINGLY ESTABLISH THAT HUBBARD'S TWO-COLOR BIDS WERE THOSE ORIGINALLY INTENDED.

APPLYING THE APPLICABLE UNIT PRICES IN HUBBARD'S BID AS ADDITIONAL CHARGES FOR COLOR, WE COMPUTE AN INCREASE OF $6,535 WHICH WOULD MAKE SPEEDPRINTERS' BID LOW. ACCORDINGLY, WE CONCLUDE THAT AWARD TO HUBBARD WAS IMPROPER AND SHOULD BE CANCELLED.