B-125581, OCT. 4, 1955

B-125581, OCT. 4, 1955

TO THE HONORABLE SECRETARY OF THE NAVY:

REFERENCE IS MADE TO A LETTER DATED SEPTEMBER 22, 1955, WITH ENCLOSURES, FROM THE ASSISTANT SECRETARY OF THE NAVY, RELATING TO A MISTAKE IN BID ALLEGED BY TRIPLEX MOTOR PARTS, SEATTLE, WASHINGTON, TO HAVE BEEN MADE IN ITS BID ON WHICH CONTRACT NO. N406S-36670, DATED JULY 20, 1955, IS BASED. YOU REQUEST A DECISION AS TO THE APPROPRIATE ACTION TO BE TAKEN BY YOUR DEPARTMENT IN THE MATTER.

THE RECORD SHOWS THAT BY INVITATION TO BID NO. B-4-56-APA, DATED JUNE 20, 1955, THE U.S. NAVAL SUPPLY DEPOT, SEATTLE, WASHINGTON, OFFERED FOR SALE, IN LOT QUANTITIES, CERTAIN MISCELLANEOUS AUTOMOTIVE SPARE PARTS, GOOD AND UNUSED, THE BIDS TO BE OPENED ON JULY 19, 1955. IN RESPONSE THERETO, TRIPLEX MOTOR PARTS SUBMITTED OFFERS AS TO CERTAIN OF THE ITEMS AND THE SAME WERE ACCEPTED AS TO ITEMS NUMBERED 1, 2, 3, 4, 5, 6, 7, 8, AND 18, FOR A TOTAL CONTRACT PRICE OF $7,486.92. THE BIDDER MADE A BID DEPOSIT IN THE AMOUNT OF $5,150.63. THE CONTRACTING OFFICER REPORTED THAT FINAL PAYMENT HAS BEEN RECEIVED ON THE SUBJECT CONTRACT BUT THAT COMPLETE DELIVERY OF THE MATERIAL HAS NOT BEEN MADE.

FOLLOWING THE AWARD OF THE CONTRACT ON JULY 20, 1955, THERE WAS RECEIVED FROM THE CONTRACTOR A LETTER DATED AUGUST 5, 1955, REQUESTING CANCELLATION OF THE CONTRACT ON THE GROUND THAT IT HAD MADE AN ERROR IN ITS BID. RESPONSE THERETO, THE CONTRACTOR WAS ADVISED BY THE DISPOSAL OFFICER UNDER DATE OF AUGUST 17, 1955, THAT ITS BIDS ON THE ITEMS IN QUESTION WERE NOT SO FAR IN EXCESS OF THE SECOND HIGH BIDDER AS TO INDICATE THAT AN ERROR MIGHT HAVE BEEN MADE, AND THAT UNDER THE CIRCUMSTANCES NO ADJUSTMENT COULD BE MADE UNDER EXISTING GOVERNMENT REGULATIONS.

BY A FURTHER LETTER (UNDATED) THE CONTRACTOR SUBMITTED TO THE U.S. NAVAL SUPPLY DEPOT A CLAIM IN THE AMOUNT OF $2,763, COVERING THE LOSS IT WAS ALLEGED IT WOULD SUSTAIN IN THIS CASE, IT BEING STATED BY THE CONTRACTOR THAT IT MADE A MISTAKE IN ITS INVENTORY, MADE FROM INSPECTION OF THE PROPERTY PRIOR TO BIDDING, OF QUANTITIES OF ARTICLES AVAILABLE IN THE SEVERAL LOTS. THE CONTRACTOR ALLEGED FURTHER THAT THERE WAS OBVIOUS ERROR IN ITS BID SINCE THE NEXT LOWER BID WAS ONE THIRD LESS THAN THE AMOUNT OF ITS BID.

WITH RESPECT TO THE ALLEGED OBVIOUS ERROR, IT HAS BEEN HELD BY THIS OFFICE IN NUMEROUS CASES THAT IN VIEW OF THE WIDE RANGE IN BIDS RECEIVED ON SURPLUS PROPERTY A MERE DIFFERENCE IN THE PRICES BID WOULD NOT NECESSARILY PLACE A CONTRACTING OFFICER ON NOTICE OF ERROR AS WOULD A LIKE DIFFERENCE IN THE PRICES QUOTED ON NEW EQUIPMENT, SUPPLIES, ETC., TO BE FURNISHED TO THE GOVERNMENT. 28 COMP. GEN. 550. FURTHERMORE, IT IS REPORTED BY THE CONTRACTING OFFICER THAT THE DIFFERENCE IN THIS INSTANCE WAS NO GREATER THAN THAT OBSERVED IN MANY OTHER SALES OF SIMILAR MATERIAL.

INSOFAR AS THE PRESENT RECORD SHOWS, THE ACCEPTANCE OF THE BID IN THIS CASE WAS IN GOOD FAITH, NO ERROR HAVING BEEN ALLEGED UNTIL AFTER AWARD. ACCORDINGLY, THE ACCEPTANCE OF THE BID CONSUMMATED A VALID AND BINDING CONTRACT WHICH FIXED THE RIGHTS AND OBLIGATIONS OF THE PARTIES. SEE UNITED STATES V. PURCELL ENVELOPE COMPANY, 249 U.S. 313, AND AMERICAN SMELTING AND REFINING COMPANY V. UNITED STATES, 259 U.S. 75.

THE RESPONSIBILITY FOR THE PREPARATION OF A BID SUBMITTED IN RESPONSE TO AN INVITATION TO BID IS UPON THE BIDDER. SEE FRAZIER DAVIS CONSTRUCTION COMPANY V. UNITED STATES, 100 C.CLS. 120, 163. IF AN ERROR WAS MADE IN THE PREPARATION OF THE BID, AS ALLEGED, IT PROPERLY MAY BE ATTRIBUTED SOLELY TO THE CONTRACTOR'S NEGLIGENCE AND SINCE THE ERROR WAS UNILATERAL, NOT MUTUAL, THE CONTRACTOR IS NOT ENTITLED TO RELIEF. SEE OGDEN AND DOUGHERTY V. UNITED STATES, 102 C.CLS. 249, 259, AND SALIGMAN, ET AL. V. UNITED STATES, 56 F.SUPP. 505, 507.

ACCORDINGLY, THERE IS NO LEGAL BASIS FOR AN ADJUSTMENT OF THE CONTRACT PRICE BASED UPON AN ALLEGED MISTAKE IN BID, OR FOR RELEASING THE CONTRACTOR FROM ITS OBLIGATION UNDER THE CONTRACT, IN THE ABSENCE OF ANY EVIDENCE THAT THERE WAS LESS PROPERTY AVAILABLE FOR DELIVERY THAN WAS EXHIBITED TO PROSPECTIVE BIDDERS.

THE PAPERS TRANSMITTED BY YOU, WITH THE EXCEPTION OF THE CONTRACTING OFFICER'S REPORT DATED SEPTEMBER 8, 1955, ARE RETURNED HEREWITH.