B-146106, JUN. 23, 1961

B-146106, JUN. 23, 1961

TO C. S. RIPPON, CONTRACTING OFFICER, BUREAU OF RECLAMATION:

REFERENCE IS MADE TO YOUR LETTER OF JUNE 9, 1961, WITH ENCLOSURES, PRESENTING FOR OUR CONSIDERATION AND DECISION THE ALLEGATION BY EDMAN AND COMPANY OF ERRORS IN ITS BID SUBMITTED IN RESPONSE TO INVITATION FOR BIDS ON SPECIFICATIONS NO. 400C-163.

THE INVITATION SOUGHT PROPOSALS FROM PROSPECTIVE CONTRACTORS FOR THE CLEARING OF THE LAND TO BE INUNDATED BY THE WATERS OF THE NAVAJO RESERVOIR. THE BUREAU OF RECLAMATION ENGINEER'S ESTIMATE FOR THE PROJECT WAS $750,000. EDMAN AND COMPANY QUOTED A PRICE OF $237,000, AS COMPARED TO THE EIGHT REMAINING OFFERS WHICH RANGED FROM $777,777.11 TO $2,184,000. AFTER OPENING OF THE BIDS, BUT BEFORE AWARD, THE LOW BIDDER NOTIFIED THE CONTRACTING OFFICER THAT IT HAD MADE A MISTAKE IN THE COMPUTATION OF ITS OFFERING PRICE BY FAILING TO INCLUDE THEREIN THE COST FOR HEAVY TREE CLEARING ON UNIT NO. 1; NECESSARY ROAD CONSTRUCTION; EQUIPMENT RENTAL AND USE OF OWNED EQUIPMENT; AND THE OVERHEAD AND PROFIT FIGURES ON SUCH OMISSIONS. AS A RESULT THEREOF THE BIDDER STATED THAT ITS OFFER SHOULD HAVE BEEN NOT LESS THAN $623,000. BY AFFIDAVIT EXECUTED BY CARL E. EDMAN, SOLE OWNER OF THE COMPANY, SUBMITTED IN SUPPORT OF THE ALLEGATION OF ERROR, THE BIDDER CERTIFIED THAT THE WORKSHEETS UPON WHICH THE CALCULATIONS FOR THE PROJECT WERE MADE HAVE BEEN LOST OR DESTROYED, BUT THAT THE SAID ERRORS OF OMISSION WERE MADE AS ALLEGED.

IN VIEW OF THE WIDE DISPARITY BETWEEN THE EDMAN BID AND THE ENGINEERING ESTIMATE AND THE OTHER PROPOSALS RECEIVED, THERE CAN BE NO REASONABLE DOUBT THAT SOME MISTAKE WAS MADE. ACCEPTANCE OF THE BID UNDER THOSE CIRCUMSTANCES WOULD BE UNCONSCIONABLE AND AN AWARD THEREON WOULD NOT CREATE A BINDING CONTRACT. HOWEVER, IT IS A BASIC RULE THAT BIDS MAY NOT BE CHANGED AFTER THE TIME FIXED FOR OPENING. 17 COMP. GEN. 575; 38 ID. 76. AND, IN THAT CONNECTION IT HAS BEEN HELD THAT CORRECTION OF AN ERRONEOUS OFFER IS NOT CONSIDERED TO BE AN EXCEPTION TO THE RULE, BUT RATHER AS THE SUBSTITUTION OF AN INTENDED BID, ESTABLISHED BY VIRTUALLY CONCLUSIVE EVIDENCE, FOR THE BID INCORRECTLY PREPARED. IN SUCH CASES A CLEAR SHOWING IS REQUIRED NOT ONLY OF THE FACTUAL ERROR, BUT OF WHAT THE INTENDED PRICE WOULD HAVE BEEN BUT FOR THE MISTAKE. IN THE APPLICATION OF THOSE PRINCIPLES TO THIS CASE, IT IS APPARENT THAT THE EVIDENCE PRESENTED IS INSUFFICIENT TO JUSTIFY CORRECTION OF THE BID TO REFLECT THE REVISED PRICE OF $623,000 PROPOSED BY THE BIDDER, WHICH IS NOT CLAIMED TO HAVE BEEN THE AMOUNT INTENDED TO BE INSERTED IN THE BID, OR TO BE BASED UPON ANY CALCULATIONS OR ESTIMATES ACTUALLY MADE BEFORE PREPARATION OF THE BID, BUT IS IN FACT A FIGURE ARRIVED AT BY FURTHER CONSIDERATION AFTER BID OPENING.

FOR THE REASONS STATED, THE BID OF EDMAN AND COMPANY SHOULD BE PERMITTED TO BE WITHDRAWN AS REQUESTED. THE ENCLOSURES SUBMITTED WITH YOUR LETTER OF JUNE 9, 1961, ARE RETURNED HEREWITH, AND COPIES OF OUR DECISION ARE BEING FORWARDED TO THE COMMISSIONER AND THE ASSISTANT COMMISSIONER, BUREAU OF RECLAMATION.