B-176900, NOV 29, 1972

B-176900, NOV 29, 1972

BID PROTEST - MISTAKE IN BID - CORRECTION PRIOR TO AWARD DECISION DENYING THE PROTEST OF NEO-FLASHER ELECTRONICS, INC., AGAINST THE AWARD OF A CONTRACT TO NATIONAL AVIATION ELECTRONICS, INC. UNDER AN IFB ISSUED BY FRANKFORD ARSENAL, PHILADELPHIA, PA. WHEN A CONTRACTING OFFICER HAS ACTUAL OR CONSTRUCTIVE KNOWLEDGE OF A MISTAKE IN A BID, HE MUST VERIFY THE BID AND PUT THE BIDDER ON NOTICE AS TO THE NATURE OF THE SUSPECTED MISTAKE. ASPR 2-406.1. IN ORDER TO CORRECT A MISTAKE PRIOR TO AWARD, THE BIDDER MUST SUBMIT CLEAR AND CONVINCING EVIDENCE THAT AN ERROR HAD BEEN MADE, THE MANNER IN WHICH THE ERROR OCCURRED, AND THE INTENDED BID PRICE. 49 COMP. GEN. 480 (1970). THE AUTHORITY TO CONSIDER CORRECTION OF MISTAKES IN BIDS ALLEGED PRIOR TO AWARD IS VESTED IN THE PROCURING AGENCIES, 29 COMP. GEN. 1 393 (1950), AND GAO WILL NOT DISTURB SUCH DETERMINATIONS UNLESS THERE IS NO REASONABLE BASIS FOR THEM. SEE 51 COMP. GEN. (1971).

TO NEO-FLASHER ELECTRONICS, INCORPORATED:

REFERENCE IS MADE TO YOUR LETTERS DATED AUGUST 29, SEPTEMBER 12, AND OCTOBER 31, 1972, PROTESTING AGAINST THE AWARD OF A CONTRACT TO NATIONAL AVIATION ELECTRONICS, INCORPORATED (NATIONAL), UNDER INVITATION FOR BIDS (IFB) NO. DAAA25-72-B-0474, ISSUED BY FRANKFORD ARSENAL, PHILADELPHIA, PENNSYLVANIA.

THE IFB, AS AMENDED, CALLED FOR 3550 EACH LIGHT, AIMING POST M14 WITH FILTERS. SEVEN BIDS WERE RECEIVED AND NATIONAL SUBMITTED THE APPARENT LOW BID OF $7.07 PER UNIT. YOUR BID OF $15.60 PER UNIT WAS THE NEXT LOWEST BID, THE THIRD LOW BID WAS $18.24 PER UNIT AND THE GOVERNMENT ESTIMATE WAS $16.00 PER UNIT. DUE TO THE BIDDING PATTERN AND THE LARGE DIFFERENCE BETWEEN THE NATIONAL BID AND THE GOVERNMENT'S ESTIMATE OF $16.00 PER UNIT THE CONTRACTING OFFICER, PURSUANT TO ARMED SERVICES PROCUREMENT REGULATION (ASPR) 2-406.1, REQUESTED NATIONAL TO VERIFY ITS BID. NATIONAL REPLIED THAT AN ERROR HAD BEEN MADE IN COMPUTING THE UNIT BID PRICE AND NATIONAL'S WORKSHEETS WERE SUBMITTED AS PROOF OF AN INTENDED BID PRICE OF $14.14 PER UNIT.

THE MATTER WAS SUBMITTED FOR AN ADMINISTRATIVE DETERMINATION AS TO WHETHER NATIONAL SHOULD BE ALLOWED TO CORRECT THEIR BID PURSUANT TO ASPR 2 -406.3(A)(2), WHICH REQUIRES CLEAR AND CONVINCING EVIDENCE BOTH AS TO THE EXISTENCE OF THE MISTAKE AND AS TO THE BID ACTUALLY INTENDED. THE APPROPRIATE AUTHORITY CONCLUDED THAT THE REQUIREMENTS HAD BEEN MET AND NATIONAL WAS GIVEN PERMISSION TO REVISE ITS BID PRICE TO $14.14 PER UNIT. AWARD WAS MADE TO NATIONAL AT A REVISED PRICE OF $14.14 PER UNIT.

YOU CONTEND THAT NATIONAL SHOULD NOT HAVE BEEN ALLOWED TO REVISE THEIR BID PRICE BECAUSE AN AWARD TO A BIDDER AT A BID PRICE OTHER THAN THE SEALED BID PRICE ORIGINALLY SUBMITTED IS IRREGULAR AND CONTRARY TO ASPR REGULATIONS. IT IS YOUR VIEW THAT NATIONAL WAS APPRIZED OF THE NEXT LOWEST BID OF $15.60 AND THEN PERMITTED TO SUBMIT EVIDENCE TO SUBSTANTIATE ITS CLAIM OF ERROR, THEREBY CREATING AN AUCTION SITUATION WHERE ONLY NATIONAL WAS GIVEN A SECOND CHANCE AT BIDDING. IT IS ALSO YOUR VIEW THAT HAD A PREAWARD SURVEY BEEN PERFORMED IT WOULD HAVE REVEALED THE FACT THAT NATIONAL COULD NOT HAVE MANUFACTURED THE ITEM AT ITS BID PRICE AND THERE WOULD HAVE BEEN A NEGATIVE AWARD RECOMMENDATION.

WHEN A CONTRACTING OFFICER HAS ACTUAL OR CONSTRUCTIVE KNOWLEDGE OF A MISTAKE IT IS INCUMBENT UPON HIM TO SEEK VERIFICATION OF THE BID AND THE REQUEST FOR VERIFICATION MUST PUT THE BIDDER ON NOTICE AS TO THE NATURE OF THE SUSPECTED MISTAKE, ASPR 2-406.1; 35 COMP. GEN. 136 (1955); B-174899, JUNE 1, 1972. IN ORDER TO CORRECT AN ALLEGED MISTAKE IN BID PRIOR TO AWARD IT IS NECESSARY FOR THE BIDDER TO SUBMIT CLEAR AND CONVINCING EVIDENCE THAT AN ERROR HAS BEEN MADE, THE MANNER IN WHICH THE ERROR OCCURRED, AND THE INTENTED BID PRICE. 49 COMP. GEN. 480 (1970); B-174608, FEBRUARY 11, 1972, 51 COMP. GEN.(1972).

NATIONAL SUBMITTED SOME 20 PAGES OF WORKSHEETS TO THE CONTRACTING OFFICER. THE WORKSHEETS WERE ACCOMPANIED BY AN AFFIDAVIT OF NATIONAL'S PRESIDENT ATTESTING TO THEIR AUTHENTICITY. THE WORKSHEETS SHOW THAT NATIONAL PROPOSED TO BID A TOTAL PRICE OF $50,197.52. A TECHNICAL REVIEW OF THE WORKSHEETS BY THE PROCURING ACTIVITY DISCLOSED THAT NATIONAL'S PURCHASE AND MANUFACTURING COSTS AS INDICATED BY BREAKOUTS THEREIN WERE CONSISTENT WITH CURRENT MARKET PRICES. HOWEVER, IT APPEARS THAT THE TOTAL BID PRICE WAS MISTAKENLY DIVIDED BY 7100 UNITS FOR A BID PRICE OF $7.07 PER UNIT AND THAT THE INCORRECT BID PRICE WAS INSERTED ON THE BID DOCUMENTS. IN CONNECTION WITH THE 7100 FIGURE, IT IS NOTED THAT THE FOLLOWING FORMAT OF AMENDMENT 1 MAY HAVE CONTRIBUTED TO THIS ERROR:

"WITH FIRST ARTICLE 3550

WITHOUT FIRST ARTICLE 3550."

ORIGINALLY, THE AUTHORITY TO CONSIDER CORRECTION OF MISTAKES IN BIDS ALLEGED PRIOR TO AWARD WAS VESTED IN OUR OFFICE. THAT AUTHORITY WAS LATER DELEGATED TO THE PROCURING AGENCIES. 29 COMP. GEN. 393 (1950). ALTHOUGH OUR OFFICE RETAINS THE RIGHT TO REVIEW ADMINISTRATIVE DETERMINATIONS, WE HAVE RECOGNIZED THAT THE WEIGHT TO BE ACCORDED EVIDENCE BEARING ON SUCH DETERMINATIONS IS PRIMARILY THE PEROGATIVE OF THE ADMINISTRATIVE EVALUATORS AND NOT TO BE DISTURBED BY OUR OFFICE UNLESS THERE IS NO REASONABLE BASIS FOR THE DETERMINATIONS. SEE 51 COMP. GEN. 1 (1971).

WE HAVE REVIEWED THE EVIDENCE RELIED UPON IN PERMITTING CORRECTION AND CANNOT CONCLUDE THAT THERE WAS NO REASONABLE BASIS FOR THE ADMINISTRATIVE DETERMINATION THAT A MISTAKE IN BID PRICE WAS MADE AND THAT NATIONAL INTENDED A BID PRICE OF $14.14 PER UNIT, BASED ON A TOTAL PRICE OF $50,197.52, DIVIDED BY 3550 UNITS. CONSEQUENTLY, THERE IS NO BASIS FOR OUR OFFICE TO OBJECT TO THE DETERMINATION PERMITTING NATIONAL TO CORRECT ITS BID.

WHILE A PREAWARD SURVEY MAY WELL HAVE DISCLOSED THAT NATIONAL COULD NOT HAVE MANUFACTURED THE ITEM AT ITS UNIT BID PRICE, WE DO NOT AGREE THAT THIS REVELATION WOULD HAVE NECESSARILY RESULTED IN A NEGATIVE RECOMMENDATION. WE BELIEVE THAT SUCH DISCLOSURE WOULD BE CONSISTENT WITH AND TEND TO SUPPORT THE CLAIMED MISTAKE.

ACCORDINGLY, YOUR PROTEST AGAINST THE AWARD MUST BE DENIED.