B-131698, MAY 20, 1957

B-131698, MAY 20, 1957

TO THE SECRETARY OF THE ARMY:

REFERENCE IS MADE TO A LETTER DATED APRIL 30, 1957, WITH ENCLOSURES, FROM THE ASSISTANT SECRETARY (LOGISTICS), REQUESTING A DECISION AS TO THE ACTION TO BE TAKEN CONCERNING AN ERROR WHICH THE B. F. GOODRICH INDUSTRIAL PRODUCTS COMPANY, A DIVISION OF THE B. F. GOODRICH COMPANY, AKRON, OHIO, ALLEGES IT MADE IN ITS BID ON WHICH CONTRACT NO. DA-20-113 ORD-21616 WAS AWARDED.

IN RESPONSE TO INVITATION NO. ORD-20-113-57-212, ISSUED BY THE ORDNANCE TANK-AUTOMOTIVE COMMAND, DETROIT, MICHIGAN, THE B. F. GOODRICH INDUSTRIAL PRODUCTS COMPANY SUBMITTED A BID DATED AUGUST 24, 1956, IN PART, AS FOLLOWS:

CHART

QUANTITY "ITEM (NUMBER OF UNIT

NO. SUPPLIES OR SERVICES UNITS) UNIT PRICE AMOUNT

1 BELT V, FAN (MATCHED SET), 8,904 EACH 1.45 $12,910.80

IN ACCORDANCE WITH

INTERNATIONAL HARVESTER

DRAWING 119323-R1, R11

DATED 11 JULY 1955 AS

MODIFIED BY TECHNICAL

ANALYSIS AND EVALUATION

REPORT NO. 54-5A-1555

REV. B DATED 7/23/56

ORDNANCE PART NO. 8331878

ORD STK NO. G744-83-31878

VEHL APPL SNL G744 EXCEPTION IS TAKEN TO SPECIFICATION

A-8904 OF IHC PART NUMBER AS B. F. GOODRICH

IS NOT APPROVED SOURCE OF SUPPLY ON

THIS PART.'

THE FIVE OTHER BIDDERS QUOTED UNIT PRICES ON ITEM 1 RANGING FROM $2.097 TO $2.7784.

THE RECORD INDICATES THAT, PRIOR TO AWARD, THE CONTRACTING OFFICER REQUESTED THE CLEVELAND ORDNANCE DISTRICT, CLEVELAND, OHIO, BY TELETYPE DATED AUGUST 30, 1956, TO CONDUCT A PRE-AWARD SURVEY OF THE ABILITY OF THE B. F. GOODRICH INDUSTRIAL PRODUCTS COMPANY TO PERFORM THE CONTRACT; THAT ON THE FOLLOWING DAY, A REPRESENTATIVE OF THE CLEVELAND ORDNANCE DISTRICT MADE THE REQUESTED SURVEY BY A TELEPHONE CALL TO THE COMPANY; AND THAT DURING THE COURSE OF SUCH SURVEY, AN EMPLOYEE OF THE COMPANY WAS REQUESTED TO VERIFY WHETHER THE COMPANY'S UNIT BID PRICE OF $1.45 "WAS FOR A SET OF MATCHED V-BELTS," AND THAT SHE REPLIED IN THE AFFIRMATIVE. THE BID OF THE COMPANY WAS ACCEPTED ON OCTOBER 15, 1956, AND SUBSEQUENTLY, THE CONTRACT WAS FORWARDED TO THE CLEVELAND ORDNANCE DISTRICT FOR ADMINISTRATION BY THE ORDNANCE TANK-AUTOMOTIVE COMMAND.

BY LETTER DATED NOVEMBER 30, 1956, IN WHICH IT REQUESTED THAT IT BE RELIEVED FROM THE PERFORMANCE OF THE CONTRACT, THE B. F. GOODRICH INDUSTRIAL PRODUCTS COMPANY ADVISED THAT ITS OFFICE PERSONNEL HAD INTERPRETED THE LANGUAGE "BELT V, FAN (MATCHED SET) 8,904 EACH," APPEARING IN THE INVITATION, AS CALLING FOR 8,904 FAN V-BELTS AND NOT 8,904 SETS OF TWO FAN V-BELTS; THAT IN SUBMITTING ITS BID, IT WAS THE INTENT AND UNDERSTANDING OF THE COMPANY THAT IT WAS BIDDING $1.45 PER FAN V-BELT FOR A TOTAL PRICE OF $12,910.80 FOR 8,904 FAN V-BELTS, AND THAT THE BELTS WERE TO BE PACKED IN MATCHED SETS OF TWO EACH; AND THAT IT REALIZED A MISUNDERSTANDING AS TO THE REQUIREMENTS OF THE INVITATION HAD OCCURRED WHEN IT RECEIVED A COPY OF THE BID PRICES RECEIVED ON THE BELTS AND THAT THIS SUSPICION WAS CONFIRMED ON OCTOBER 25, 1956, WHEN A GOVERNMENT EMPLOYEE INFORMED THE COMPANY THAT HE UNDERSTOOD THAT THE CONTRACT CALLED FOR 8,904 SETS OF TWO BELTS PER SET. THE COMPANY CONTENDS THAT THE LANGUAGE USED IN THE CONTRACT AS TO THE UNIT OF PROCUREMENT IS AMBIGUOUS AND THAT IF THE GOVERNMENT INTENDED THAT A UNIT BE A MATCHED SET OF TWO BELTS, IT WOULD HAVE BEEN VERY EASY TO HAVE SO PROVIDED UNDER THE COLUMN ENTITLED "UNIT" BY SPECIFYING A UNIT AS A SET INSTEAD OF USING THE WORD "EACH.' IN AN AFFIDAVIT DATED NOVEMBER 28, 1956, THE COMPANY EMPLOYEE, WHO ALLEGEDLY CONFIRMED THAT THE COMPANY'S BID PRICE COVERED A MATCHED SET OF TWO BELTS, STATED THAT IT WAS HER IMPRESSION DURING THE WHOLE TELEPHONE CONVERSATION WITH THE GOVERNMENT EMPLOYEE WHO REQUESTED THE BID CONFIRMATION, THAT THE MAIN PURPOSE OF THE TELEPHONE CALL WAS TO FIND OUT WHETHER THE FEDERAL EXCISE TAX WAS INCLUDED IN THE BID PRICE AND THAT SHE WAS NOT AWARE THAT SHE WAS ASKED WHETHER THE PRICE QUOTED WAS $1.45 PER BELT OR $1.45 PER MATCHED SET OF TWO BELTS.

IN HIS REPORT DATED JANUARY 2, 1957, IN WHICH RESCISSION OF THE CONTRACT WAS RECOMMENDED, THE SUCCESSOR CONTRACTING OFFICER STATED THAT IT WAS HIS OPINION THAT THE LANGUAGE OF THE CONTRACT IS SUFFICIENTLY AMBIGUOUS TO JUSTIFY ITS RESCISSION AND THAT THE CONTRACT UNIT OF PROCUREMENT SHOULD HAVE BEEN THE WORD "SET" INSTEAD OF "EACH.' IN 1ST INDORSEMENT DATED JANUARY 31, 1957, THE ORIGINAL CONTRACTING OFFICER CONCURRED IN THE FINDINGS AND RECOMMENDATION OF THE SUCCESSOR CONTRACTING OFFICER. THE RECORD INDICATES THAT PAST PROCUREMENT WITH THE CONTRACTOR FOR SIMILAR RUBBER BELTS CONSISTED OF TEN CONTRACTS, AND THAT IN EACH OF THE THREE CONTRACTS FOR SETS OF BELTS, THE UNIT OF PROCUREMENT WAS A "SET" AND, CONVERSELY, IN EACH OF THE SEVEN CONTRACTS CALLING FOR A SINGLE BELT AS THE UNIT OF PROCUREMENT, THE CONTRACT SPECIFIED THE UNIT "EACH.'

ALTHOUGH AN ATTEMPT WAS MADE BY A TELEPHONIC PRE-AWARD SURVEY TO CLARIFY WHETHER THE CONTRACTOR'S UNIT PRICE APPLIED TO A SINGLE BELT OR TO A SET OF TWO MATCHED BELTS, IT APPEARS FROM THE EVIDENCE THAT THERE WAS A MISUNDERSTANDING ON THE PART OF THE CONTRACTOR'SREPRESENTATIVE AS TO THE NATURE OF THE TELEPHONE CALL, WHICH MERELY COMPOUNDED THE ORIGINAL MISUNDERSTANDING BETWEEN THE PARTIES AS TO THE UNIT OF PROCUREMENT BID UPON.

OUR OFFICE AGREES WITH THE OPINIONS OF THE CONTRACTING OFFICER AND SUCCESSOR CONTRACTING OFFICER IN REGARD TO THIS MATTER AND, ACCORDINGLY THE AWARD MADE TO THE B. F. GOODRICH INDUSTRIAL PRODUCTS COMPANY ON OCTOBER 15, 1956, SHOULD BE CANCELLED AND THE COMPANY RELIEVED OF ALL LIABILITY UNDER THE CONTRACT, AS ADMINISTRATIVELY RECOMMENDED.