B-129152, SEP. 12, 1956

B-129152, SEP. 12, 1956

TO THE SECRETARY OF THE NAVY:

REFERENCE IS MADE TO A LETTER DATED SEPTEMBER 4, 1956, WITH ENCLOSURES, FROM THE ASSISTANT SECRETARY OF THE NAVY (MATERIAL), RELATING TO A MISTAKE IN BID ALLEGED BY THE ORR PUBLISHING COMPANY AND OFFICE EQUIPMENT, INGLESIDE, ILLINOIS, UNDER CONTRACT NO. N128S-96274, (SALES CATALOG NO. B- 163-56) ISSUED BY THE NAVAL SUPPLY DEPOT, GREAT LAKES, ILLINOIS. IN VIEW OF THE FACTS SET FORTH IN THE ENCLOSURES TO THE LETTER OF SEPTEMBER 4, A DECISION IS REQUESTED AS TO WHETHER THE CONTRACT PROPERLY MAY BE AMENDED TO DECREASE THE UNIT PRICE AND THE TOTAL PRICE OF ITEM 22, AS RECOMMENDED BY THE CONTRACTING OFFICER.

THE RECORD SHOWS THAT BY INVITATION NO. B-163-56, DATED JULY 9, 1956, THE NAVAL SUPPLY DEPOT, GREAT LAKES, ILLINOIS, OFFERED FOR SALE CERTAIN GOVERNMENT-OWNED PROPERTY CONSISTING OF MISCELLANEOUS GENERAL STORES MATERIAL, THE BIDS TO BE OPENED AT 10:00 A.M. ON AUGUST 2, 1956. RESPONSE TO THE INVITATION, THE ORR PUBLISHING COMPANY AND OFFICE EQUIPMENT SUBMITTED BIDS AS TO ITEMS 22 AND 23 AND, BEING THE HIGHEST BIDS RECEIVED, THE SAME WERE ACCEPTED. BY LETTER OF AUGUST 8, 1956, THE CONTRACTOR CLAIMED THAT AN ERROR HAD BEEN MADE IN THE UNIT PRICE AS TO ITEM 22 IN THAT THE BID PRICE WAS STATED AS $0.51 PER UNIT, WHEREAS A BID PRICE OF ONLY $0.21 PER UNIT WAS INTENDED--- THE TOTAL BID PRICE OF $38.25 BEING CORRECT. IN EXPLANATION OF THE ERROR THE CONTRACTOR STATED IN THE LETTER OF AUGUST 8, 1956, AS FOLLOWS:

"THE TOTAL BID WAS $72.19 ON ITEMS 22 AND 23. I ATTENDED THE OPENING OF THE BIDS AND ASKED FOR TWO $5 BILLS IN EXCHANGE FOR A $10 BILL, AS $15 WOULD BE SUFFICIENT TO COVER OUR 20 PERCENT DEPOSIT OF $72.19. NO ONE SEEMED TO HAVE TWO $5 BILLS SO I DEPOSITED $20, WHICH WOULD BE 20 PERCENT OF ANYTHING TO $100. THE TOTAL BID, CONSIDERING A 51 CENT ITEM ON LOT 22, WOULD MAKE THE BID $125.74. TWENTY DOLLARS WOULD NOT BE 20 PERCENT. THEREFORE, THE ENTIRE BID COULD BE ELIMINATED. THIS ERROR WAS BROUGHT TO THE ATTENTION OF THE BID OPENER AT THE TIME OF THE OPENING OF THE BIDS.

IN A COMMUNICATION TO THIS OFFICE DATED AUGUST 9, 1956, THE COMMANDING OFFICER OF THE NAVAL SUPPLY DEPOT STATED THAT THE CONTRACT HEREIN WAS AWARDED AT THE UNIT PRICE OF $0.51 ON THE BASIS THAT UNDER THE TERMS OF THE CONTRACT WHEN THERE IS A DIFFERENCE BETWEEN THE UNIT PRICE AND THE EXTENSION, THE UNIT PRICE WILL GOVERN; THAT THE CONTRACTING OFFICER BELIEVES THE STATEMENTS IN THE CONTRACTOR'S LETTER OF AUGUST 8, 1956, ARE TRUE AND THAT, IN FACT, THE BIDDER DID MAKE AN HONEST ERROR WHEN SUBMITTING THE UNIT PRICE OF $0.51. ON THE BASIS OF THE FACTS OF THE CASE AND THE TERMS AND CONDITIONS OF THE SALES CONTRACT, THE COMMANDING OFFICER RECOMMENDED THAT RELIEF BE GRANTED. IT IS REPORTED THAT DELIVERY OF ITEM 22 WAS ACCOMPLISHED ON AUGUST 9, 1956.

THERE APPEARS TO BE LITTLE ROOM FOR DOUBT THAT A BONA FIDE ERROR WAS MADE BY THE CONTRACTOR IN ITS BID AS TO ITEM 22, AND THAT THE FACT OF THE ERROR WAS MADE KNOWN TO REPRESENTATIVES OF THE GOVERNMENT PRIOR TO THE AWARD OF THE CONTRACT. UNDER THE CIRCUMSTANCES, AND IN VIEW OF THE RECOMMENDATION OF THE CONTRACTING OFFICER, THERE SHOULD BE REFUNDED TO THE CONTRACTOR THE DIFFERENCE BETWEEN THE UNIT BID PRICE OF $0.51 AND THE INTENDED UNIT BID PRICE OF $0.21 AS TO ITEM 22. A COPY OF THIS DECISION SHOULD BE ATTACHED TO THE VOUCHER MAKING THE REFUND.

THE PAPERS, WITH THE EXCEPTION OF THE COMMANDING OFFICER'S STATEMENT DATED AUGUST 9, 1956, ARE RETURNED HEREWITH.