B-143979, OCT. 4, 1960

B-143979, OCT. 4, 1960

TO THE SECRETARY OF THE ARMY:

WE REFER TO A LETTER DATED SEPTEMBER 14, 1960, FROM YOUR DEPARTMENT, REQUESTING A DECISION AS TO THE PROPRIETY OF REFORMING CONTRACT NO. DA 30- 144-ORD-5450, WITH DEVLIEG MACHINE COMPANY, SO AS TO REMOVE THE REQUIREMENT IN THE CONTRACT THAT THE CONTRACTOR FURNISH THE MATERIAL LISTED THEREIN UNDER THE HEADING "STANDARD ACCESSORIES AND TOOLS.'

ON MAY 23, 1960, IFB NO. ORD-30-144-60-182 WAS ISSUED, CALLING FOR BIDS ON A JIG BORING AND MILLING MACHINE, PRECISION TYPE, WITH ENGINEERING SERVICES, TEMPLETS AND REPAIR PARTS CATALOGS, ALL LISTED UNDER ITEM NOS. 1 THROUGH 4. THE INVITATION INCORPORATED MFG. SPEC. NO. 28-59, REV. NO. 1, WHICH REQUESTED BIDDERS TO SUBMIT COST BREAKDOWN ON "ADDITIONAL OPTIONAL EQUIPMENT," SPECIFICALLY LISTED UNDER PARA. 3.16 OF THE SPECIFICATION. THE SPECIFICATION INFORMED BIDDERS THAT THE EQUIPMENT WOULD BE EVALUATED WITH THE BID, BUT MIGHT OR MIGHT NOT BE PURCHASED AT THE TIME OF AWARD. PAGE NO. 5 OF THE INVITATION INSTRUCTED BIDDERS TO LIST BY ITEMIZATION, ALL ,STANDARD ACCESSORIES AND TOOLS" NORMALLY FURNISHED WITH THE MACHINE AS STANDARD.

TWO BIDS WERE RECEIVED IN RESPONSE TO THE INVITATION, INCLUDING ONE BY DEVLIEG MACHINE COMPANY AND THE OTHER BY LUCAS MACHINE DIVISION OF NEW BRITAIN MACHINE COMPANY. DEVLIEG INCORPORATED A PRICE BREAKDOWN OF THE REQUIRED ITEM ON A SEPARATE ATTACHED SHEET TO ITS BID. THIS SHEET GAVE THE BASIC MACHINE TOOL AND ITS PRICE PLUS OTHER EQUIPMENT, WHICH, THE CONTRACTING OFFICER STATES, COULD BE CONSIDERED STANDARD ACCESSORIES AND TOOLS, BUT WAS NOT LISTED AS SUCH. HOWEVER, ON PAGE NO. 5 OF THE INVITATION, UNDER THE HEADING "STANDARD ACCESSORIES AND TOOLS," DEVLIEG LISTED VARIOUS ITEMS WITH A PRICE BREAKDOWN OF EACH ITEM. IT WAS NOTICED BY THE ADMINISTRATIVE OFFICIAL EVALUATING THE BIDS THAT THE ITEMS LISTED BY DEVLIEG UNDER "STANDARD ACCESSORIES AND TOOLS" ON PAGE NO. 5 ACTUALLY APPEARED TO BE THE "ADDITIONAL OPTIONAL EQUIPMENT" CALLED FOR BY PARA. 3.16 OF THE SPECIFICATIONS.

DEVLIEG SUBMITTED A BID OF $56,430, WHILE LUCAS SUBMITTED A BID OF $56,270, BUT AFTER CONSIDERING THE DISCOUNT OFFERED BY DEVLIEG (1 PER CENT --- 10 DAYS), AND CERTAIN UNACCEPTABLE DEVIATIONS FOUND IN THE LUCAS BID, IT WAS DETERMINED THAT DEVLIEG OFFERED THE LOWEST RESPONSIVE BID ON THE SUBJECT INVITATION. IT IS REPORTED THAT FUNDS WERE AVAILABLE TO COVER THE REQUIRED MACHINE BUT WERE NOT SUFFICIENT TO COVER ANY OF THE ADDITIONAL OPTIONAL EQUIPMENT. ON JUNE 22, 1960, AN AWARD WAS ADMINISTRATIVELY PREPARED FROM THE DEVLIEG BID FORM AND THE EQUIPMENT LISTED THEREIN AS "STANDARD ACCESSORIES AND TOOLS" WAS TRANSPOSED TO THE AWARD FORM AS SUCH, ALTHOUGH IT HAD BEEN ADMINISTRATIVELY UNDERSTOOD THAT THE EQUIPMENT WAS ACTUALLY INTENDED AS OPTIONAL EQUIPMENT, WHICH HAD NOT BEEN INCLUDED IN THE EVALUATION OR RECOMMENDATION TO THE CONTRACTING OFFICER FOR ACCEPTANCE. ON JUNE 27, 1960, THE CONTRACTOR, AFTER RECEIVING NOTICE OF THE AWARD MADE ON JUNE 22, 1960 (WHICH DID NOT INCLUDE ANY REQUIREMENT FOR OPTIONAL EQUIPMENT), NOTIFIED THE CONTRACTING OFFICER THAT THE AWARD CONTAINED OPTIONAL EQUIPMENT AS A PART OF THE CONTRACT UNDER THE HEADING "STANDARD ACCESSORIES AND TOOLS.'

THE CONTRACTING OFFICER IS OF THE OPINION THAT THE CONTRACTOR INADVERTENTLY PLACED THE OPTIONAL EQUIPMENT UNDER "STANDARD ACCESSORIES AND TOOLS," AND DUE TO AN ADMINISTRATIVE FAILURE TO CAREFULLY ANALYZE THE BID, THE MISTAKE WAS CARRIED FORWARD IN THE CONTRACT. IT IS ADMINISTRATIVELY RECOMMENDED THAT THE CONTRACT BE CORRECTED TO SHOW THE TRUE INTENTIONS OF BOTH PARTIES BY DELETING THE ITEMS LISTED UNDER "STANDARD ACCESSORIES AND TOOLS" IN THE CONTRACT.

THE RULE OF LAW IS THAT, WHEN BY REASON OF MUTUAL MISTAKE, A CONTRACT AS REDUCED TO WRITING DOES NOT REFLECT THE ACTUAL AGREEMENT OF THE PARTIES, THE WRITTEN INSTRUMENT MAY BE REFORMED IF IT CAN BE ESTABLISHED WHAT THE AGREEMENT ACTUALLY WAS. 30 COMP. GEN. 220, AND CASES CITED THEREIN. THE TIME THE INSTANT AWARD WAS MADE, NEITHER PARTY TO THE CONTRACT INTENDED THAT THE ITEMS LISTED IN THE CONTRACTOR'S BID FORM UNDER THE HEADING "STANDARD ACCESSORIES AND TOOLS" WOULD BE FURNISHED TO THE GOVERNMENT AT THE BID PRICE SUBMITTED ON THE BASIC MACHINE. HOWEVER, DUE TO A MISTAKE BY THE CONTRACTOR IN ITS SUBMITTED BID, AND AN OVERSIGHT BY THE GOVERNMENT IN DRAWING UP THE AWARD, THE CONTRACT REFLECTS AN AGREEMENT WHICH NEITHER PARTY INTENDED. UNDER THESE CIRCUMSTANCES, YOU ARE ADVISED THAT WE OFFER NO OBJECTION TO THE EXECUTION OF A PROPER MODIFICATION TO THE CONTRACT TO REMOVE THE REQUIREMENT THAT THE CONTRACTOR FURNISH THE MATERIAL LISTED THEREIN UNDER THE HEADING "STANDARD ACCESSORIES AND TOOLS," SO AS TO CONFORM THE CONTRACT TO THE ACTUAL INTENTION OF THE PARTIES.