B-144251, OCT. 28, 1960

B-144251, OCT. 28, 1960

TO THE SECRETARY OF THE ARMY:

REFERENCE IS MADE TO A LETTER DATED OCTOBER 12, 1960, WRITTEN IN BEHALF OF THE ASSISTANT SECRETARY OF THE ARMY (LOGISTICS), REQUESTING A DECISION AS TO THE ACTION TO BE TAKEN CONCERNING AN ERROR WHICH E. F. GOETZ CONSTRUCTION COMPANY ALLEGES THAT IT MADE IN ITS BID SUBMITTED IN RESPONSE TO INVITATION FOR BIDS NO. (ENG) ORD-36-005-60-66 ISSUED BY LETTERKENNY ORDNANCE DEPOT, CHAMBERSBURG, PENNSYLVANIA.

THE INVITATION SOLICITED BIDS FOR PAINTING, INSTALLATION OF LOUVERS AND PAVING IN SIX EXCITING TRANSITORY SHELTERS AT THE LETTERKENNY ORDNANCE DEPOT. SEVEN BIDS WERE RECEIVED IN THIS CASE. THE LOW BID OF $54.125 WAS SUBMITTED BY E. F. GOETZ CONSTRUCTION COMPANY. THE OTHER BIDS WERE IN THE AMOUNTS OF $59,732, $66,400, $70,200, $72,850, $73,000 AND $79,544. THE GOVERNMENT ESTIMATE IS STATED TO HAVE BEEN $76,205. ON THE DAY OF BID OPENING, OR ON JUNE 22, 1960, A GOVERNMENT REPRESENTATIVE VERBALLY REQUESTED MR. CHARLES GOETZ OF THE E. F. GOETZ CONSTRUCTION COMPANY TO RECHECK ITS BID. IT IS STATED THAT "BECAUSE OF THE NATURE OF THE REQUIREMENTS, NO PARTICULAR AREA OR POSSIBLE OMISSION COULD BE POINTED OUT TO THE BIDDER.' THE PROCUREMENT OFFICE RECEIVED A CONFIRMATION OF THE CONTRACT PRICE BY LETTER DATED JUNE 22, 1960. THEREAFTER, ON JUNE 30, 1960, AWARD WAS MADE TO GOETZ AND NOTICE TO PROCEED WAS ACKNOWLEDGED BY THE CONTRACTOR ON JULY 26, 1960.

IT IS REPORTED THAT ON JULY 5, 1960, MR. ECKELS, THE OWNER OF JACK H. ECKELS' SHEET METAL WORKS, ADVISED THE CONTRACTING OFFICE THAT HE HAD MADE A MISTAKE IN HIS BID AS A SUBCONTRACTOR TO GOETZ. MR. ECKELS STATED THAT HIS SUPPLIER, YORK CORRUGATING COMPANY, HAD QUOTED A PRICE OF $45 FOR EACH LOUVER AND THAT IN MULTIPLYING THE NUMBER OF LOUVERS BY THE QUOTED PRICE (90 X $45), HE MADE AN ERROR IN POINTING OFF 3 DECIMAL POINTS INSTEAD OF 2, MAKING HIS BID FOR THIS PARTICULAR ITEM $405, WHEREAS IT SHOULD HAVE BEEN $4,050. IT IS REPORTED FURTHER THAT --

"/4) E. F. GOETZ CONSTRUCTION COMPANY SUBMITTED A LETTER DATED 6 JULY 1960, ADVISING THAT AS A RESULT OF A MISTAKE IN COMPUTATION BY THEIR SUB- CONTRACTOR, JACK H. ECKELS' SHEET METAL WORKS, THEIR BID WAS IN ERROR AND REQUESTED THAT THE TOTAL CONTRACT PRICE BE INCREASED TO $58,827.50. INFORMATION SUPPLIED INDICATES THAT THE PRICE QUOTED TO E. F. GOETZ CONSTRUCTION COMPANY FOR THE LOUVERS WAS $475.00, TO WHICH WAS ADDED 10 PERCENT, THUS THE AMOUNT OF $522.50 WAS USED IN COMPUTING THEIR BID.

"/5) DUE TO DISCREPANCIES IN THE ALLEGED MISTAKE BETWEEN E. F. GOETZ CONSTRUCTION COMPANY AND JACK H. ECKELS' SHEET METAL WORKS, WHEREIN MR. ECKELS SPECIFIED A QUOTED PRICE OF $405.00 WHICH SHOULD HAVE BEEN $4,050.00 AND MR. GOETZ SPECIFIED A PRICE OF $475.00 WHICH SHOULD HAVE BEEN $4,750.00 PLUS 10 PERCENT FOR THE GENERAL CONTRACTOR, MR. JACK ECKELS WAS REQUESTED TO VISIT THIS DEPOT ON 21 JULY 1960 TO DISCUSS AND CLARIFY THE DIFFERENCES.

"THE SUMMARY OF THE DISCUSSION FOLLOWS:

"MR. ECKELS ADVISED THAT YORK CORRUGATING COMPANY HAD QUOTED HIM, BY TELEPHONE, A PRICE OF $45.00 EACH PER LOUVER WHICH HE WROTE DOWN IN PENCIL AND THEN MULTIPLIED IT BY 9, ARRIVING AT $405.00, REALIZING HE USED 9 INSTEAD OF 90, HE PLACED ANOTHER ZERO TO THE $450.00 WITHOUT CHANGING THE DECIMAL POINT GIVING HIM THE FIGURE $405.000. MR. ECKELS FURTHER ADVISED THAT HE HAD A FIGURE OF $4,050.00 IN HIS MIND WHICH HE MULTIPLIED BY 10 PERCENT FOR PROFIT AND ARRIVED AT $405.00 TO WHICH HE ADDED $180.00 FOR LABOR, $20.00 FOR BOLTS, $100.00 FOR FLASHING, TOTALING $700.00 WHICH REPRESENTED HIS LABOR AND PROFIT. HE THEN ADDED $405.00 (MATERIAL COST) AND $700.00 (LABOR AND PROFIT) ARRIVING AT $475.00, THIS BEING DONE THUSLY

"$405.000

700

$475.000

MR. ECKELS ALLEGES THAT HE THEN CONTACTED E. F. GOETZ CONSTRUCTION CO. BY TELEPHONE AND QUOTED $475.00 FOR SUPPLYING AND INSTALLING THE LOUVERS.'

FIVE OUT OF SIX BIDS SUBMITTED WERE BELOW THE GOVERNMENT ESTIMATE. THE DIFFERENCE IN THE AMOUNTS OF THE FOUR LOWEST BIDS WERE FAIRLY UNIFORM AND THERE WAS NOTHING IN THE BIDDING PATTERN THAT WAS CONSIDERED UNUSUAL BUT IT WAS NEVERTHELESS DECIDED TO REQUEST VERIFICATION IN VIEW OF THE AMOUNT OF THE GOVERNMENT ESTIMATE. THE MANNER IN WHICH THE ALLEGED MISTAKE WAS MADE IS NOT ENTIRELY CLEAR. REGARDLESS OF WHETHER IT SHOULD BE RECOGNIZED THAT THERE WAS A MISTAKE MADE IN THIS CASE AND THAT THE INTENDED BID PRICE HAS BEEN ESTABLISHED, THE FACT REMAINS THAT GOETZ WAS GIVEN AN OPPORTUNITY TO RECHECK AND VERIFY ITS BID. AND AFTER HAVING CONFIRMED ITS BID THE CONTRACTING OFFICER MADE THE AWARD TO GOETZ. HAD THE CONTRACTING OFFICER NOT AWARDED THE CONTRACT TO GOETZ AS THE LOWEST RESPONSIBLE BIDDER, HE WOULD HAVE BEEN DERELICT IN HIS DUTY TO THE GOVERNMENT. SHRIMPTON MFG. COMPANY V. BRIN, 125 S.W. 942; ALABAMA SHIRT AND TROUSER CO. V. UNITED STATES, 121 CT.C.L. 313; AND 37 COMP. GEN. 786. THE RIGHT OF THE GOVERNMENT TO RECEIVE PERFORMANCE IN STRICT ACCORDANCE WITH THE CONTRACT TERMS MAY NOT BE WAIVED BY ANY OFFICER OF THE GOVERNMENT IN THE ABSENCE OF ADEQUATE CONSIDERATION. THE FACT THAT A CONTRACTOR MAY SUFFER A HARDSHIP DOES NOT AUTHORIZE AN EXCEPTION TO THE RULE. SEE 22 COMP. GEN. 60; DAY V. UNITED STATES, 245 U.S. 159.

IN THE CIRCUMSTANCES WE FIND NO LEGAL BASIS FOR RELIEVING THE CONTRACTOR OF ITS OBLIGATION TO PERFORM THE INVOLVED WORK AT ITS BID PRICE OF $54,125.