B-101197, MAR 1, 1951

B-101197, MAR 1, 1951

PRECIS-UNAVAILABLE

THE SECRETARY OF THE AIR FORCE:

REFERENCE IS MADE TO LETTER DATED FEBRUARY 2, 1951, FROM THE CHIEF, PROCUREMENT DIVISION, DIRECTORATE, PROCUREMENT & ENGINEERING OFFICE, DEPUTY CHIEF OF STAFF, MATERIEL, FORWARDING LETTER OF JANUARY 22, 1951, WITH ENCLOSURES, FROM CHARLES C. DEWITT, CONTRACTING OFFICER, HEADQUARTERS, AIR MATERIEL COMMAND, WRIGHT-PATTERSON AIR FORCE BASE, DAYTON, OHIO, AND REQUESTING THAT A DECISION BE RENDERED TO THE CONTRACTING OFFICER RELATIVE TO AN ERROR ALLEGED BY THE AMERICAN CHAIN & CABLE COMPANY, INC., DETROIT, MICHIGAN, TO HAVE BEEN MADE ON ITEM 10 OF ITS ACCEPTED BID DATED DECEMBER 22, 1950.

SINCE AWARD HAS BEEN MADE IN THE PRESENT CASE, THE CONTRACTING OFFICER IS NOT ENTITLED TO A DECISION. SEE 26 COMP. GEN. 993, AND 28 ID. 401. HOWEVER, SINCE A DECISION APPEARS NECESSARY, THE DECISION IS BEING ADDRESSED TO YOU.

THE AIR MATERIEL COMMAND, WRIGHT-PATTERSON AIR FORCE BASE, DAYTON, OHIO, BY INVITATION NO. 33-038-51-966, REQUESTED BIDS - TO BE OPENED DECEMBER 28, 1950 - FOR FURNISHING, AMONG OTHER ITEMS, 8,000 TERMINALS, "EYE END CABLE 1-4 IN. DIA 7000 LB., P/N AN 668-8, S/N 6500-933995," ITEM 10. RESPONSE THERETO, THE AMERICAN CHAIN & CABLE COMPANY, INC., SUBMITTED A BID WHEREIN IT OFFERED TO FURNISH, AMONG OTHERS, THE TERMINALS UNDER ITEM 10 AT A PRICE OF $0.24 EACH.

THE AMERICAN CHAIN & CABLE COMPANY, INC., ADVISED BY TELEGRAM DATED DECEMBER 29, 1950, THAT ITS QUOTATION ON ITEM 10 WAS IN ERROR AND THAT THE PRICE OF SAID ITEM SHOULD HAVE READ $0.67 EACH INSTEAD OF $0.24 EACH. LETTER DATED JANUARY 12, 1951, THE CORPORATION CONFIRMED ITS ALLEGATION OF ERROR AND STATED THEREIN THAT IN WRITING TO ITS COST DEPARTMENT FOR A PRICE ON ITEM 10, A TYPOGRAPHICAL ERROR WAS MADE IN SAID LETTER IN THAT INSTEAD OF REQUESTING A PRICE ON PART NO. AN 668-8 THE PART SPECIFIED UNDER ITEM 10 OF THE INVITATION - IT REQUESTED A PRICE ON PART NO. AN 668- 5, ON WHICH, IT ALLEGES, ITS BID PRICE ON ITEM 10 IS BASED. IN SAID LETTER THE CORPORATION REQUESTED THAT ITS BID PRICE ON ITEM 10 BE CORRECTED TO READ $0.67 EACH.

IN THE CONTRACTING OFFICER'S LETTER OF JANUARY 22, 1951, IT WAS STATED THAT BECAUSE TIME DID NOT PERMIT PROCESSING OF THE MISTAKE IN BID CASE IN ACCORDANCE WITH CUSTOMARY PROCEDURES, THE BID OF THE AMERICAN CHAIN & CABLE COMPANY, INC., WAS ACCEPTED AS TO ITEM 10, SUBJECT TO CORRECTION, IF AUTHORIZED, BY THE GENERAL ACCOUNTING OFFICE.

THE ABSTRACT OF BIDS SHOWS THAT THE FIVE OTHER BIDS ON ITEM 10 RANGED FROM $0.80 EACH TO $1.03 EACH. THUS, THE BID OF THE AMERICAN CHAIN & CABLE COMPANY, INC., OF $0.24 EACH FOR ITEM 10 IS OUT OF LINE WITH THE OTHER BIDS THEREON. IT IS APPARENT THAT THE CORPORATION MADE AN ERROR IN ITS BID, AS ALLEGED.

THE GENERAL RULE IS THAT THE ACCEPTANCE OF A BID WITH KNOWLEDGE OF AN ERROR THEREIN DOES NOT CONSUMMATE A VALID AND BINDING CONTRACT. SEE 17 COMP. GEN. 575; NASON COAL COMPANY V. UNITED STATES, 64 C. CLS. 526; RESTATEMENT OF THE LAW OF CONTRACTS, SECTION 503; AND WILLISTON ON CONTRACTS, SECTION 1578. ALSO, SEE MOFFETT, HODGKINS, AND CLARKE COMPANY V. ROCHESTER, 178 U.S. 373; KEMP V. UNITED STATES, 38 F. SUPP. 568; ALTA ELECTRIC AND MECHANICAL COMPANY, INC. V. UNITED STATES, 90 C.CLS. 466. ALTHOUGH THE CORPORATION ALLEGED AND EXPLAINED THE ERROR IN ITS BID PRIOR TO AWARD, IT HAS NOT FURNISHED EVIDENCE SATISFACTORILY ESTABLISHING THAT THE CORRECT PRICE OF PART NO. AN 668-8, ITEM 10, IS $0.67 EACH, AS ALLEGED. ACCORDINGLY, SINCE THERE IS NOTHING IN THE RECORD INDICATING THAT THE CORPORATION HAS COMMENCED DELIVERY OF THE TERMINALS CALLED FOR UNDER SAID CONTRACT, AND SINCE THE ACCEPTANCE OF THE CORPORATION'S BID WAS MADE SUBJECT TO THE FINAL ACTION OF THIS OFFICE ON THE CLAIM OF ERROR, THE AWARD MADE TO THE AMERICAN CHAIN & CABLE COMPANY, INC., SHOULD BE CANCELLED.

THE PAPERS, WITH THE EXCEPTION OF THE CONTRACTING OFFICER'S LETTER OF JANUARY 22, 1951, ARE FORWARDED HEREWITH.