B-125757, NOV. 3, 1955

B-125757, NOV. 3, 1955

TO THE HONORABLE SECRETARY OF THE NAVY:

REFERENCE IS MADE TO YOUR LETTER OF OCTOBER 10, 1955, WITH ENCLOSURES, REQUESTING A DECISION AS TO THE ACTION TO BE TAKEN WITH RESPECT TO ERRORS ALLEGED TO HAVE BEEN MADE BY THE EDWARD S. MYERS COMPANY IN ITS BIDS, DATED AUGUST 22, 1955, ON ITEMS NOS. 5 AND 87 IN SALES INVITATION NO. B-9- 56, ON WHICH CONTRACT NO. N407S-1665, DATED SEPTEMBER 8, 1955, WAS BASED.

THE SALE COVERED ITEMS NOS. 1 THROUGH 101 OF GOVERNMENT-OWNED SURPLUS PROPERTY LOCATED AT THE NAVAL SUPPLY DEPOT, MECHANICSBURG, PENNSYLVANIA. THE COMPANY'S BIDS WERE ACCEPTED ON ITEMS NOS. 5, 16, 31, 72 AND 87. APPARENTLY AT THE TIME OF ACCEPTANCE THE CONTRACTING OFFICER SUSPECTED ERROR IN THE BID OF $309 ON ITEM NO. 5, SINCE IN HIS REPORT DATED SEPTEMBER 16, 1955, HE STATED THAT THE COMPANY'S BID ON THAT ITEM WAS SIX TIMES THE ACQUISITION COST OF THE ITEM AND FAR IN EXCESS OF THE HIGHEST OF THE NINE OTHER BIDS RECEIVED THEREON, RANGING FROM $33.92 TO $4.80 FOR THE QUANTITY OF SOIL PIPE TEES INVOLVED. ALSO, THE COMPANY IN A LETTER OF SEPTEMBER 7, 1955--- THE DAY PRECEDING THE DATE OF ACCEPTANCE--- TO THE CONTRACTING OFFICER STATED, IN PERTINENT PART, AS FOLLOWS:

"MR. EVANS WAS KIND ENOUGH TO ADVISE OUR OFFICE THAT WE WERE SUCCESSFUL BIDDERS ON THE FOLLOWING LOTS--- NO. 5, NO. 14 (TIE), NO. 16, NO. 31, NO. 72, NO. 87, AND WOULD WE VERIFY OUR BIDDING OF $309.00 FOR LOT NUMBER 5.

IN THE SAME LETTER THE COMPANY ALLEGED THAT TWO ERRORS WERE MADE IN ITS BID IN THAT THE PRICE QUOTED ON ITEM NO. 5 WAS INTENDED FOR ITEM NO. 4 AND THE PRICE QUOTED ON ITEM NO. 87 WAS INTENDED FOR ITEM NO. 86. A COPY OF THE BID FORM WITH PRICES INSERTED THEREON IN INK, ALLEGEDLY ITS ORIGINAL RETAINED COPY OF THE BID, WAS FURNISHED PURPORTEDLY TO SHOW, IN SUBSTANTIATION OF ITS ALLEGATION OF ERROR, THAT NO BID ORIGINALLY WAS ENTERED, OR INTENDED, FOR ITEMS NOS. 5 OR 87. A PRICE OF $309 APPEARS ON THE BID COPY FOR ITEM NO. 4 AND A BID OF $89 WAS ENTERED THEREON AS THE LOT PRICE FOR ITEM NO. 86. THE INCONSISTENCY BETWEEN THE BID AND THE RETAINED COPY WAS ASCRIBED TO TRANSPOSITIONAL ERRORS MADE IN TYPING THE BID BY INEXPERIENCED HELP SUBSTITUTING FOR ITS CHIEF BOOKKEEPER WHO WAS AWAY ON VACATION.

ALTHOUGH THE ABOVE REFERRED-TO COPY OF THE BID IS UNVERIFIED AND ACTUALLY IS NOT A TRUE CORRECT COPY OF THE COMPANY'S BID, THE FACTS OF RECORD WARRANT THE CONCLUSION THAT THERE WAS A BONA FIDE ERROR AND THAT THE CONTRACTING OFFICER HAD AT LEAST CONSTRUCTIVE, IF NOT ACTUAL, NOTICE OF THE ERROR ON ITEM NO. 5 PRIOR TO THE ACCEPTANCE. SINCE THE UNCONDITIONAL ACCEPTANCE, AS TO ITEM NO. 5, IN THE CIRCUMSTANCES MAY NOT BE CONSIDERED AN ACCEPTANCE IN GOOD FAITH, THE AWARD AS TO THAT ITEM SHOULD BE CANCELED AS NOW RECOMMENDED BY THE CONTRACTING OFFICER. HOWEVER, SINCE THE BID ON ITEM NO. 87 IS NOT OUT OF LINE WITH THE OTHER BIDS RECEIVED ON THAT ITEM OR WITH ITS ACQUISITION COST, THE RECORD AFFORDS NO BASIS FOR THE CONCLUSION THAT THE CONTRACTING OFFICER HAD EITHER ACTUAL OR CONSTRUCTIVE NOTICE OF ANY ERROR ON ITEM NO. 87 OF THE COMPANY'S BID PRIOR TO AWARD. IT FOLLOWS THAT THE ACCEPTANCE OF THE BID AS TO ITEM NO. 87 OBLIGATED THE CONTRACTOR TO ACCEPT DELIVERY OF THAT ITEM AT THE LOT PRICE FIXED THEREFOR IN THE RESULTANT CONTRACT.