B-125583, OCT. 18, 1955

B-125583, OCT. 18, 1955

TO THE HONORABLE SECRETARY OF THE ARMY:

REFERENCE IS MADE TO A LETTER DATED SEPTEMBER 21, 1955, WITH ENCLOSURES, FROM THE ASSISTANT SECRETARY OF THE ARMY (LOGISTICS), RELATING TO A MISTAKE IN BID ALLEGED BY THE GENERAL ICE CREAM CORPORATION, WATERTOWN, NEW YORK, AFTER AWARD OF A CONTRACT NO. DA 30 033-AI-275, DATED MARCH 29, 1955. IN VIEW OF THE FACTS SET FORTH IN THE ENCLOSURES, A DECISION IS REQUESTED AS TO WHETHER THE CONTRACTOR'S APPLICATION FOR RELIEF MAY BE GRANTED.

THE RECORD SHOWS THAT BY INVITATION NO. A1-30-033-55-19, DATED MARCH 4, 1955, THE PURCHASING AND CONTRACTING OFFICE, CAMP DRUM, WATERTOWN, NEW YORK, REQUESTED BIDS--- TO BE OPENED MARCH 22, 1955--- FOR FURNISHING 1,182,130 CONTAINERS OF ICE CREAM, 6 OZ. CUP OR CARTON, ASSORTED FLAVORS, ETC. BY ADDENDUM NO. 1, DATED MARCH 21, 1955, THE DATE OF OPENING WAS EXTENDED TO MARCH 28, 1955, AND ITEM 1 OF THE BID SHEET WAS CHANGED TO READ AS FOLLOWS:

"ICE CREAM, 6 OZ. AVOIRDUPOIS CUP OR CARTON, ASSORTED FLAVORS. VANILLA ICE CREAM MUST MEET THE REQUIREMENTS OF TYPE 1/A) FED SPEC EE 1-116B, AND ALL OTHER FLAVOR (CHOCOLATE, FRUIT AND NUTS) MUST MEET THE REQUIREMENTS OF TYPE 1/B) EE-1-116B.'

BY ADDENDUM NO. 2, DATED MARCH 22, 155, PARAGRAPH 1 OF ADDENDUM NO. 1 WAS CHANGED TO REQUIRE THE FURNISHING OF CUPS OR CARTONS OF ICE CREAM OF 4 OUNCES, AVOIRDUPOIS. IN RESPONSE TO THE INVITATION, THE GENERAL ICE CREAM CORPORATION SUBMITTED A BID DATED MARCH 24, 1955, OFFERING TO FURNISH THE CUPS OR CARTONS OF ICE CREAM CALLED FOR BY THE INVITATION AT A UNIT PRICE OF $0.0620, OR A TOTAL PRICE OF $73,292.06. OTHER BIDDERS QUOTED TOTAL PRICES OF $93,092.74 AND $99,771.77. AWARD OF THE CONTRACT WAS MADE TO THE GENERAL ICE CREAM CORPORATION ON MARCH 29, 1955.

IN RESPONSE TO THE ORIGINAL INVITATION, THAT IS, TO FURNISH ICE CREAM, 6 OZ. CUPS OR CARTONS, ASSORTED FLAVORS, ETC., THE CONTRACTOR SUBMITTED A BID AT A UNIT PRICE OF $0.0620 FOR FURNISHING CUPS OR HAVE BEEN WITHDRAWN SINCE THE REQUIREMENTS OF THE ORIGINAL INVITATION WERE SUPERSEDED BY THE INDICATED ADDENDA. THEREAFTER, THE CONTRACTOR SUBMITTED A BID AT A UNIT PRICE OF $0.0620 FOR FURNISHING CUPS OR CARTONS OF ICE CREAM, 4 OUNCES, AVOIRDUPOIS, COVERED BY ADDENDUM NO. 2.

THE BASIS FOR THE CONTRACTOR'S REQUEST FOR AN INCREASE IN THE CONTRACT PRICE IS THAT IN THE PREPARATION OF ITS BID THERE WAS OVERLOOKED THE FACT THAT A CHANGE WAS MADE FROM A 6 OZ. CUP BY VOLUME TO A 6 OZ. AVOIRDUPOIS CUP. IN LETTER OF APRIL 30, 1955, THE CONTRACTOR STATED THAT IT IS A WIDESPREAD INDUSTRY PRACTICE TO SELL ICE CREAM BY VOLUME AND NOT BY WEIGHT, AND THAT FOR MANY YEARS CAMP DRUM, AS WELL AS ALL OTHER MILITARY INSTALLATIONS, HAS ORDERED ITS INDIVIDUAL CONTAINERS OF ICE CREAM BY VOLUME AND NOT BY WEIGHT. THE LETTER OF APRIL 30, 1955, CONTAINS THE FOLLOWING EXPLANATORY PARAGRAPH:

"SECONDLY, A BRIEF CONSIDERATION OF THE BID PRICE SUBMITTED WILL SHOW CLEARLY THAT IT WAS SUBMITTED IN ERROR. ORIGINALLY WE BID ?9888 PER DOZEN FOR A 6 OZ. CUP BY VOLUME WHICH EQUALS .0824 PER CUP. SEE COPY ATTACHED. A 6 OZ. STANDARD CUP BY VOLUME WILL CONTAIN ON THE AVERAGE 3.6 OUNCES OF ICE CREAM PER CUP WHICH WOULD AMOUNT TO A BID OF ?02288 PER OUNCE. BELIEVE IT IS REASONABLE TO CONCLUDE THAT SINCE WE BID A PRICE OF ?9888 PER DOZEN FOR A CUP WEIGHING 3.6 OUNCES THAT OUR BID FOR A CUP WEIGHING 4 OUNCES WOULD HAVE BEEN HIGHER THAN ?9888 PER DOZEN IF WE HAD NOT MADE A MISTAKE. CERTAINLY WE WOULD NOT HAVE BID A PRICE FOR A CUP WEIGHING 4 OUNCES WHICH WAS LESS THAN THE PRICE WE HAD ALREADY BID FOR A CUP WEIGHING ONLY 3.6 OUNCES.'

TAKING INTO CONSIDERATION ALL OF THE FACTS AND CIRCUMSTANCES IN THIS CASE, IT IS APPARENT THAT THE CONTRACTOR MADE AN ERROR IN SUBMITTING ITS BID. IN VIEW OF THE EXPLANATION CONTAINED IN THE PARAGRAPH QUOTED ABOVE, AND IN VIEW OF THE RANGE BETWEEN THE CONTRACTOR'S BID OF $73,292.06 AND THE NEXT HIGH BID OF $93,092.74 ON A MORE OR LESS STANDARD ARTICLE OF PURCHASE, IT SEEMS THAT THE CONTRACTING OFFICER SHOULD HAVE BEEN ON NOTICE OF THE PROBABILITY OF ERROR AND THAT THE BID SHOULD NOT HAVE BEEN ACCEPTED WITHOUT REQUESTING THE BIDDER TO VERIFY ITS BID.

ACCORDINGLY, CONTRACT NO. DA 30-033-A1-275 MAY BE AMENDED TO INCREASE THE PRICE TO THAT OF THE NEXT HIGHER BIDDER--- THE DAIRYMEN'S LEAGUE COOPERATIVE ASSOCIATION BID OF $0.07875. PRICE ADJUSTMENT SHOULD BE MADE FOR ANY DELIVERIES CONTINUING A SHORTAGE IN WEIGHT.

A REFERENCE TO THIS DECISION SHOULD BE MADE ON THE AMENDMENT TO BE ATTACHED TO THE CONTRACT.