B-147828, JAN. 3, 1962

B-147828, JAN. 3, 1962

TO MR. R. S. WELSH:

REFERENCE IS MADE TO YOUR LETTER OF DECEMBER 19, 1961, YOUR FILE NO. 3- 200, REQUESTING AN ADVANCE DECISION AS TO WHETHER AN AWARD OF CONTRACT MAY BE MADE TO THE APPARENT LOW BIDDER, FRANK G. FURMAN, ROBERTS CO., LOWE AND WATSON, AND LOWE AND WATSON CONSTRUCTION CO., INC., A JOINT VENTURE, OR WHETHER THE CLAIM OF ERROR BY TROY DALE RAYMOND AND A. J. TOSTON, A JOINT VENTURE, IS TO BE CONFIRMED AND THEIR BID CONSIDERED FOR AWARD UNDER BID INVITATION FOR FURNISHING THE MATERIALS AND PERFORMING WORK DESCRIBED UNDER SPECIFICATIONS NO. 300C 157, EARTHWORK AND RIPRAP, SOUTH GILA LEVEE, COLORADO RIVER FRONT WORK AND LEVEE SYSTEM, ARIZONA.

IN ADDITION TO THE TOTAL LOW BID SUBMITTED IN THE AMOUNT OF $676,041.30 BY TROY DALE RAYMOND AND A. J. TOSTON, A JOINT VENTURE, ELEVEN OTHER BIDS RANGING FROM $683,794.10 TO $1,232,022 WERE RECEIVED PURSUANT TO THE BID INVITATION.

YOU STATE THAT ORIGINALLY THERE WERE FURNISHED WITH THE INVITATION FOR BIDS TWO SCHEDULES FOR BIDDING FOR THE WORK. PURSUANT TO SUPPLEMENTAL NOTICE NO. 2, THESE SCHEDULES WERE DELETED IN THEIR ENTIRETY AND A SINGLE BIDDING SCHEDULE WAS ADOPTED FOR SUBMITTING BIDS. THE REVISED BIDDING SCHEDULE CONTAINED SIX SEPARATE ITEMS OF WORK OR MATERIAL STATING ESTIMATED QUANTITIES AND THE UNIT OF WORK APPLICABLE FOR EACH ITEM UPON WHICH UNIT BID PRICES WERE REQUESTED. A SPACE WAS PROVIDED FOR INSERTING A UNIT PRICE, TOTAL PRICE FOR EACH ITEM AND A TOTAL PRICE FOR THE ENTIRE SCHEDULE. THE BIDDING SCHEDULE CONTAINED THE PROVISION THAT "BIDS WILL BE CONSIDERED ON THE FOLLOWING SCHEDULE BUT NO BID WILL BE CONSIDERED FOR ONLY A PART OF THE SCHEDULE.' THE RECORD SHOWS THAT THE PRIOR ENGINEERS' ESTIMATE OF THE WORK FOR THE PROJECT WAS $762,980, BUT THE LATEST PROGRAM ESTIMATE IS SHOWN AS $655,000.

THE QUESTION HERE PRESENTED INVOLVES THE BID SUBMITTED BY TROY DALE RAYMOND AND A. J. TOSTON, A JOINT VENTURE, AND PARTICULARLY THE UNIT PRICE BID AND THE EXTENDED TOTAL FOR ITEM NO. 2 OF THE SCHEDULE. ITEM NO. 2 RELATES TO THE OVERHAUL FOR EXCAVATED MATERIAL REQUIRED FOR EMBANKMENTS, UNDER THE SPECIFICATIONS. THE QUANTITY WAS STATED IN THE APPLICABLE COLUMN IN THE SUBSTITUTED BIDDING SCHEDULE AS 6,331,000 STATION CUBIC YARDS. IN ARTICLE 37 OF THE SPECIFICATIONS, A STATION CUBIC YARD OF OVERHAUL IS DEFINED AS A CUBIC YARD OF EXCAVATED MATERIAL HAULED 100 FEET IN EXCESS OF THE FREE-HAUL LIMIT. THE BIDS ON ITEM NO. 2 ARE AS FOLLOWS:

CHART

BIDDER QUANTITY UNIT PRICE AMOUNT FRANK G. FURMAN, ROBERTS CO., LOWE AND WATSON, AND LOWE AND WATSON CONSTRUCTION CO., INC., A JOINT VENTURE

6,331,000 STA. CU. YD. $0.006 $ 37,986.00 TROY DALE RAYMOND AND A. J. TOSTON, A JOINT VENTURE DO. DO. 0.005 3,165.50 MARSHALL AND HAAS DO. DO. 0.01 63,310.00 CAMERON BROS. DO. DO. 0.0052 32,921.00 TANNER BROS. DO. DO.0.005 31,655.00 K.E.C. COMPANY DO. DO. 0.005 31,655.00 ARROW CONSTRUCTION COMPANY, INC.

DO. DO. 0.0075 47,482.50 N. J. RIEBE ENTERPRISES, INC., AND ELCO CORP., A JOINT VENTURE DO. DO. 0.03 189,930.00 CLYDE W. WOOD AND SONS, INC.

DO. DO. 0.0035 22,158.50 VINSON CONSTRUCTION COMPANY DO.

DO. 0.006 37,986.00 VINNELL CORPORATION DO. DO. 0.008 50,648.00 SILBERBERGER CONSTRUCTION INC. DO. DO. 0.004 25,324.00

IN YOUR LETTER IT IS STATED THAT THE REPORT OF THE BOARD OF ENGINEERS OF NOVEMBER 22, 1961, NOTES THE FACT THAT THE BIDDER, TROY DALE RAYMOND AND A. J. TOSTON, A JOINT VENTURE, MADE WHAT APPEARED TO THE BOARD TO BE AN ERROR IN THE EXTENSION OF THE UNIT PRICE FOR ITEM NO. 2. INSTEAD OF THE $3,165.50 BID BY THEM THE TOTAL SHOULD HAVE BEEN $31,655 WHEN CONSIDERING THE QUANTITY SPECIFIED TOGETHER WITH THE UNIT PRICE BID. THIS ERROR WAS SUMMARILY CORRECTED BY THE BOARD AS THUS RAISING THE TOTAL PRICE BID BY THIS BIDDER FOR THE SCHEDULE FROM $676,041.30 TO $704,530.80, MAKING THEM THE SECOND LOW BIDDER. THE ABSTRACT OF BIDS, AFTER THE CORRECTION OF THE RAYMOND AND TOSTON BID FOR ITEM NO. 2, SHOWS THE THREE LOWEST BIDS TO BE AS FOLLOWS:

CHART

BIDDER TOTAL BID FRANK G. FURMAN, ROBERTS COMPANY, LOWE AND WATSON, AND LOWE AND WATSON CONSTRUCTION COMPANY, INC., A JOINT VENTURE

$683,794.10 TROY DALE RAYMOND AND A. J. TOSTON, A JOINT VENTURE 704,530.80 (CORRECTED) MARSHALL AND HAAS 752,601.00

YOU STATE FURTHER THAT ON NOVEMBER 22, 1961, TROY DALE RAYMOND AND A. J. TOSTON, APPARENTLY KNOWING THAT THE GOVERNMENT HAD DISCOVERED THIS ERROR IN THEIR BID, WROTE A LETTER TO THE REGIONAL DIRECTOR AND REQUESTED THAT THEIR BID BE CONSIDERED FOR AWARD ON THE BASIS THAT A CLERICAL ERROR HAD BEEN MADE IN THE PLACEMENT OF THE DECIMAL POINT IN THE UNIT PRICE FOR ITEM NO. 2 AND THAT IT WAS THEIR INTENT "THAT THE PRICE FOR THE STATION OVERHAUL BE SHOWN AS .0005 PER STATION YARD OVERHAUL WITH A TOTAL PRICE FOR THE ITEM OF NUMBER 3,165.50 AS OUR WORK SHEETS SHOW.' IN SUPPORT OF THE ERROR, AS ALLEGED, A CERTIFIED COPY OF THEIR ORIGINAL WORKSHEETS FOR THE PROJECT WAS SUBMITTED.

YOU STATE IN YOUR LETTER OF DECEMBER 19 THAT IN COMPARING THE ACTUAL UNIT PRICE BID FOR ITEM NO. 2 ON CLAIMANT'S BID WITH THE OTHER RESPONDING BIDS AND WITH THE ENGINEERS' ESTIMATE, THERE IS NO INDICATION THAT THE UNIT PRICE BID BY THIS BIDDER WAS ERRONEOUS. ACCORDINGLY, YOU DO NOT CONSIDER IT TO BE OBVIOUS THAT A MISPLACED DECIMAL POINT IN THEIR UNIT PRICE WAS MADE, AS ALLEGED.

IN CASES WHERE AN ERROR IS ALLEGED BY A BIDDER IN ITS BID PRIOR TO ACCEPTANCE AND AWARD OF A CONTRACT AND EVIDENCE IS SUBMITTED TO ESTABLISH CLEARLY THAT AN ERROR WAS IN FACT MADE WE HAVE GENERALLY PERMITTED WITHDRAWAL OF THE BID. AS A GENERAL RULE, BIDDERS ON PROPOSED GOVERNMENT CONTRACTS ARE NOT PERMITTED TO CHANGE THEIR BIDS AFTER OPENING. HOWEVER, AS WE HAVE STATED MANY TIMES, THE QUESTION WHETHER A BIDDER MAY BE PERMITTED TO CHANGE A BID--- AFTER THE BIDS HAVE BEEN OPENED--- BECAUSE OF AN ERROR THEREIN ALWAYS PRESENTS A MATTER OF SERIOUS CONCERN AND THE INTERESTS OF BOTH THE GOVERNMENT AND OTHER BIDDERS RESPONDING TO THE INVITATION MUST BE TAKEN INTO CONSIDERATION. IN OUR OPINION, BIDDERS WOULD NOT BE COMPETING UPON A COMMON BASIS IF, AFTER OPENING OF THE BIDS, THE OSTENSIBLE LOW BIDDER WAS PLACED IN THE FAVORABLE POSITION OF EITHER BEING ABLE TO WITHDRAW ITS BID, CLAIM AND OBTAIN A CORRECTION IN ITS BID PRICES OR INSIST UPON THE CORRECTNESS OF ITS BID PRICES.

IN THE INSTANT CASE, IT APPEARS THAT TROY DALE RAYMOND AND A. J. TOSTON, A JOINT VENTURE, WHETHER INTENTIONALLY OR NOT, HAVE PLACED THEMSELVES IN THE POSITION OF EITHER CLAIMING ERROR IN THE EXTENDED TOTAL PRICE OR CLAIMING AN ERROR IN THE UNIT PRICE ON ITEM NO. 2 OF THEIR BID, WHICHEVER WOULD PERMIT THEM TO MAINTAIN THEIR LOW POSITION IN THE OVER-ALL CONTRACT PRICE. IN THESE CIRCUMSTANCES, WE MUST CONCLUDE THAT THE BIDDER IS IN THE POSITION OF HAVING AN OPPORTUNITY FOR A SECOND GUESS AFTER BIDS WERE OPENED.

ANY SUCH CHOICE WOULD CLEARLY OPERATE AS HAVING AN ADVERSE EFFECT UPON THE RIGHTS OF THE OTHER BIDDERS TO COMPETE ON EQUAL TERMS FOR THE BUSINESS OF THE GOVERNMENT AND WE CANNOT APPROVE THE VIOLATION OF ANY SUCH RIGHTS. MOREOVER, SINCE THE UNIT PRICE OF $0.005 APPEARING IN THE BID OF RAYMOND AND TOSTON IS IDENTICAL WITH OTHER BIDS RECEIVED ON ITEM NO. 2, WE WOULD NOT BE JUSTIFIED IN AUTHORIZING CORRECTION OF THE UNIT PRICE TO AN AMOUNT WHICH WOULD BE EXTREMELY LOW AND FAR OUT OF LINE WITH ALL OTHER BIDS RECEIVED.

ACCORDINGLY, THE BID OF TROY DALE RAYMOND AND A. J. TOSTON, A JOINT VENTURE, SHOULD BE DISREGARDED IN MAKING AWARD OF THE CONTRACT IN THE INSTANT CASE.

AS REQUESTED, THE ORIGINAL DOCUMENTS AND CORRESPONDENCE SUBMITTED WITH YOUR LETTER ARE RETURNED.