B-118346, FEB 4, 1954

B-118346, FEB 4, 1954

PRECIS-UNAVAILABLE

SECRETARY OF THE AIR FORCE:

REFERENCE IS MADE TO A LETTER DATED JANUARY 13, 1954, AND ITS ENCLOSURES, FROM LOUIS E. SCHNARR, SUPERINTENDENT OF PURCHASING AND CONTRACTING, PURCHASING AND CONTRACTING OFFICE, 503RD AIR DEFENSE GROUP, PORTLAND INTERNATIONAL AIRPORT, PORTLAND, OREGON, RELATIVE TO AN ERROR ALLEGED BY THE STAR COMPANY, NORTH BEND, OREGON, TO HAVE BEEN MADE IN ITS BID DATED DECEMBER 18, 1953, ON WHICH CONTRACT NO. AF 35(608)-144, DATED AS OF DECEMBER 24, 1953, IS BASED. HE REQUESTS A DECISION AS TO WHETHER THERE IS AUTHORIZED AN INCREASE IN THE CONTRACT PRICE IN THE AMOUNT OF $1,712.75.

THE CONTRACTING OFFICER IS NOT ENTITLED TO A DECISION IN THIS CASE. COMP. GEN. 993; 28 ID. 401. HOWEVER, SINCE A DECISION APPEARS TO BE REQUIRED IN THIS MATTER, IT IS BEING DIRECTED TO YOU.

BY INVITATION DATED DECEMBER 8, 1953, THE 503RD AIR DEFENSE GROUP REQUESTED BIDS - TO BE OPENED DECEMBER 22, 1953 - FOR REVISING THE STEAM TESTING SYSTEM AT THE 761ST ACGAS SQUADRON, NORTH BEND, OREGON. RESPONSE THERETO, THE STAR COMPANY SUBMITTED ITS BID IN A TOTAL AMOUNT OF $14,938. BY LETTER OF DECEMBER 28, 1953, TO THE CONTRACTING OFFICER, THE STAR COMPANY ADVISED THAT IT HAD MADE AN ERROR IN ITS BID, SUCH ERROR BEING EXPLAINED AS FOLLOWS:

"*** ON DECEMBER 18, WE RECEIVED QUOTATIONS FROM CONSOLIDATED SUPPLY CO. BY TELEPHONE. THIS WAS DONE BECAUSE THERE WAS NOT TIME TO WAIT FOR THE MAIL, WHICH HAS BEEN VERY, VERY SLOW LATELY. MR. LLOYD DAY, OF OUR COMPANY RECEIVED THE CALL FROM MR. MCKAY OF THE CONSOLIDATED SUPPLY CO.

"WHEN MR. MCKAY QUOTED THE PRICE ON THE B-4-1 PUMPING UNITS HE QUOTED THE PRICE FOR ONE UNIT INSTEAD OF SIX, WHICH ARE REQUIRED FOR THE JOB. MR. DAY UNDERSTOOD THAT THE PRICE WAS FOR THE JOB.

"WHEN WE RECEIVED THE QUOTATIONS BY MAIL AND CHECKED THEM OVER ON DECEMBER 28, WE FOUND THAT THE PRICE WAS FOR ONE UNIT ONLY. THIS MAKES OUR BID PRICE SHORT ONE THOUSAND SEVEN HUNDRED TWELVE DOLLARS AND SEVENTY- FIVE CENTS ($1,712.75)

"THE PRICE OF EACH UNIT TO US IS $342.55. THIS WOULD MAKE A TOTAL OF $2,055.30 FOR THE SIX UNITS. WE HAVE THE PRICE OF ONE UNIT IN THE BID, SO WE ARE SHORT FIVE UNIT PRICE, OR $1,712.75."

THE ABSTRACT OF BIDS SHOWS TWO OTHER BIDS IN THE AMOUNTS OF $19,440 AND $24,535. IN THE LETTER OF JANUARY 13, 1954, IT IS STATED THAT THE BID OF THE STAR COMPANY IS "SUBSTANTIALLY BELOW THE ESTIMATE OF OUR ENGINEERING OFFICE" AND THAT THE NOTICE OF ERROR WAS RECEIVED BY THE CONTRACTING OFFICER PRIOR TO AWARD. IF INCREASED IN THE AMOUNT OF $1,712.75 AS REQUESTED BY THE BIDDER, THE CONTRACT PRICE WOULD BE $16,650.75, WHICH PRICE IS SUBSTANTIALLY LESS THAN THE NEXT LOWEST BID.

ALTHOUGH IT APPEARS PROBABLE THAT THE STAR COMPANY MADE A BONA FIDE ERROR IN ITS BID, THE FILE CONTAINS NO EVIDENCE OF ERROR OTHER THAN THE STATEMENT OF THE BIDDER AND THE STATEMENT IN THE CONTRACTING OFFICER'S LETTER OF JANUARY 13, 1954, THAT "INVESTIGATION OF THE MISTAKE AS OUTLINED IN 'NOTICE OF MISTAKE,' REVEALS THAT THE PRESS OF BUSINESS AND THE DESIRE TO MEET THE TIME SPECIFIED FOR THE OPENING OF BIDS, THE STAR CO. HAD MADE AN HONEST MISTAKE."

THE STAR COMPANY SHOULD BE REQUIRED TO SUBMIT TO THE CONTRACTING OFFICER SATISFACTORY EVIDENCE IN SUPPORT OF ITS ALLEGATION OF ERROR, SUCH AS ITS ORIGINAL WORKSHEETS SWORN TO AS SUCH, AND A CATALOG OR OTHER EVIDENCE FROM ITS SUPPLIER SHOWING THE ESTABLISHED PRICE OF THE B 4-1 PUMPING UNIT REFERRED TO. IF SUCH EVIDENCE REASONABLY ESTABLISHES THE ERROR CLAIMED, THIS OFFICE WILL INTERPOSE NO OBJECTION TO INCREASING THE CONTRACT PRICE IN AN AMOUNT NOT EXCEEDING $1,712.75.

SUCH ADDITIONAL EVIDENCE AS MAY BE SUBMITTED BY THE STAR COMPANY SHOULD BE ATTACHED TO THE CONTRACT OR THE VOUCHER COVERING PAYMENT TO THE COMPANY, AND A REFERENCE THEREON SHOULD BE MADE TO THIS DECISION.

THE ABSTRACT OF BIDS, THE STAR COMPANY'S LETTER OF DECEMBER 28, 1953, AND THE POWER OF ATTORNEY TO GERTRUDE CURRIER ARE BEING RETAINED IN THIS OFFICE. THE OTHER PAPERS ARE RETURNED HEREWITH.