B-124321, JUN. 24, 1955

B-124321, JUN. 24, 1955

TO THE HONORABLE SECRETARY OF THE ARMY:

REFERENCE IS MADE TO YOUR LETTER OF JUNE 15, 1955, WITH ENCLOSURES, RELATIVE TO AN ERROR ALLEGED BY RAY GOODSON CONSTRUCTION COMPANY TO HAVE BEEN MADE IN ITS BID DATED MAY 17, 1955, ON WHICH CONTRACT NO. DA 41-443- ENG-4616 DATED MAY 18, 1955, IS BASED. YOU REQUEST A DECISION AS TO WHETHER THE AWARD MAY BE CANCELED.

YOU STATE THAT THE OPENING WAS AT 2:00 P.M. ON MAY 17, 1955, AND THAT IMMEDIATELY AFTER THE READING OF THE BIDS MR. GOODSON, THE SOLE OWNER OF THE COMPANY, STATED HIS BELIEF THAT HE HAD MADE AN ERROR, SINCE THE VARIANCE BETWEEN HIS BID AND THE OTHER BIDS WAS SO GREAT, BUT THAT, NOT HAVING HIS ORIGINAL WORKSHEETS WITH HIM, HE COULD NOT VERIFY, AT THAT TIME, THE EXISTENCE OF AN ERROR. ALSO, YOU STATE THAT WITHIN 24 HOURS AFTER THE OPENING, AND WITHOUT OBTAINING ANY FURTHER INFORMATION FROM MR. GOODSON, THE BID WAS ACCEPTED BY TELEGRAM DISPATCHED AT 1:00 P.M. ON MAY 18, 1955, AND CONFIRMED BY LETTER OF THE FOLLOWING DAY.

BY A VERIFIED STATEMENT DATED MAY 23, 1955, MR. GOODSON ADVISED THAT TWO ERRORS WERE MADE IN COMPUTING HIS COMPANY'S BID. HE EXPLAINED THAT THE COST OF THE LEASING OF THE EQUIPMENT NECESSARY FOR THE JOB HAD BEEN ESTIMATED TO BE $46,077 ON ONE OF ITS 28 SEPARATE WORKSHEETS, THAT IT WAS INTENDED THAT THIS ITEM OF COST WOULD BE PRORATED APPROPRIATELY SO AS TO INCREASE CERTAIN OTHER ITEMS CONTAINED IN THE ESTIMATE, BUT THAT IN THE RECAPITULATION OF ITS ESTIMATED COSTS THE SAID ITEM COVERING EQUIPMENT RENTAL WAS NOT SPREAD OUT AS INTENDED BUT WAS INADVERTENTLY OMITTED IN ITS ENTIRELY. THE OTHER ERROR WAS STATED TO BE DUE TO A MISINTERPRETATION OF ITS SUPPLIER'S QUOTATION OF THE PRICE FOR THE FOUR RUNS OF PIPE, IN THAT THE QUOTATION OF $2,967 PER CFT WAS ERRONEOUSLY UNDERSTOOD TO BE PER LENGTH, OR RUN, OF 190 FEET 6 INCHES EACH, INSTEAD OF PER 100 FEET. THUS, THE MISTAKE ON THE FOUR RUNS OF PIPE AMOUNTED TO $10,740.54 AND THE TWO MISTAKES AMOUNTED TO $56,817.54. BUT FOR THE ERRORS, IT IS STATED THAT THE BID WOULD HAVE BEEN $402,142.55, WHICH CONSEQUENTLY, WOULD NOT HAVE BEEN THE LOWEST BID RECEIVED. THEREFORE, THE COMPANY REQUESTED THAT IT BE RELEASED FROM OBLIGATION UNDER ITS BID AND THE CONTRACT BASED THEREON.

SHEETS NOS. 4-10 AND 4-23 OF THE CONTRACTOR'S ORIGINAL WORKSHEETS, CONSISTING OF 28 SHEETS NUMBERED R-1 THROUGH R-28, AND THE QUOTATION DATED MAY 11, 1955, RECEIVED FROM THE L. B. FOSTER COMPANY, ITS SUPPLIER, FOR THE STEEL PIPING REQUIRED, REASONABLY ESTABLISH THAT THE ERRORS WERE MADE IN CALCULATING THE BID PRICE, AS ALLEGED.

IN VIEW OF THE PRE-AWARD CONFERENCE WITH MR. GOODSON RELATIVE TO THE PROBABILITY OF ERROR IN HIS BID, AND THE SUBSTANTIAL DIFFERENCE BETWEEN THE COMPANY'S BID, THE GOVERNMENT'S ESTIMATE OF $394,515.61 FOR THE WORK (NOT INCLUDING PROFIT), AND THE 14 OTHER BIDS, OF WHICH THE NINE HIGHER RANGED FROM $393,809 TO $428,335.50, THE ACTION OF THE CONTRACTING OFFICER IN MAKING THE AWARD ON THE QUESTIONED BID WITHOUT ALLOWING A REASONABLE TIME FOR CONFIRMATION BY THE BIDDER OF HIS SUGGESTION OF ERROR IS CONSIDERED TO HAVE BEEN SO ARBITRARY AS TO AMOUNT TO BAD FAITH.

ACCORDINGLY, IT APPEARING THAT THERE HAS BEEN NO PERFORMANCE BY THE CONTRACTOR, THE AWARD SHOULD BE CANCELED.

ONE OF THE DUPLICATE SETS OF DOCUMENTS TRANSMITTED WITH YOUR LETTER IS RETURNED, THE OTHER ..END :