B-152194, AUG. 20, 1963

B-152194, AUG. 20, 1963

TO DIRECTOR, DEFENSE SUPPLY AGENCY:

REFERENCE IS MADE TO A LETTER DATED JULY 30, 1963, WITH ENCLOSURES, FILE REFERENCE DSSO-FB, FROM THE CHIEF, DEFENSE SURPLUS SALES OFFICE, DEFENSE LOGISTICS SERVICES CENTER, FORT BLISS, TEXAS, REQUESTING A DECISION AS TO WHETHER THE REQUEST OF THE M.J.R. CORPORATION, NEW YORK, NEW YORK, FOR RELIEF UNDER SALES CONTRACT NO. DSA-38-S-640 MAY BE GRANTED.

THE DEFENSE SURPLUS SALES OFFICE, FORT BLISS, TEXAS, BY INVITATION NO. 38 -S-63-34 REQUESTED BIDS FOR THE PURCHASE FROM THE GOVERNMENT OF, AMONG OTHER ITEMS, ONE LOT OF PHOTOGRAPHIC SUPPLIES, ITEM 33, THE ORIGINAL ACQUISITION COST OF WHICH WAS STATED TO BE $1,598.80. IN RESPONSE THE M.J.R. CORPORATION SUBMITTED A BID OFFERING TO PURCHASE THE PHOTOGRAPHIC SUPPLIES COVERED BY ITEM 33 AT A LOT PRICE OF $1,079. THE BID OF THE M.J.R. CORPORATION WAS ACCEPTED AS TO ITEMS 1 AND 33 ON JUNE 21, 1963.

AFTER RECEIVING NOTICE OF AWARD OF ITEMS 1 AND 33, THE M.J.R. CORPORATION ADVISED THE CONTRACTING OFFICER BY LETTER DATED JUNE 24, 1963, THAT THE CORPORATION HAD BID ON ITEM 34 AND NOT ITEM 33. THE CORPORATION REQUESTED THAT THE MATTER BE INVESTIGATED AS ITEM 33 WAS OF NO VALUE TO THE FIRM. THE CORPORATION WAS ADVISED BY LETTER DATED JUNE 27, 1963, THAT ITS BID CLEARLY INDICATED A BID OF $1,079 ON ITEM 33.

BY LETTER DATED JULY 2, 1963, THE CORPORATION ADVISED THAT IT HAD INTENDED TO BID ON ITEM 34, ONE LOT OF PHOTOGRAPHIC FILM AND ACCESSORIES, INSTEAD OF ITEM 33 AND THE CORPORATION REQUESTED THAT ITEM 33 OF THE CONTRACT BE CANCELED. THE CORPORATION STATED THAT AN ABSTRACT OF THE OTHER BIDS RECEIVED ON ITEM 33 WOULD SUBSTANTIATE THAT THE CORPORATION MADE AN ERROR, AS ALLEGED, AND THAT IF IT WAS FORCED TO TAKE ITEM 33, IT WOULD SUFFER A LOSS OF $1,000. IN SUPPORT OF ITS ALLEGATION OF ERROR, THE CORPORATION SUBMITTED ITS WORKSHEET, WHICH APPEARS TO BE A COPY OF THE DESCRIPTION SHEET COVERING ITEMS 33 AND 34. THE WORKSHEET INDICATES A BID OF $1,079 FOR ITEM 34, ONE LOT OF PHOTOGRAPHIC FILM AND ACCESSORIES; HOWEVER, NO QUOTATION APPEARS FOR ITEM 33, ONE LOT OF PHOTOGRAPHIC SUPPLIES.

THERE WAS NOTHING ON THE FACE OF THE BID OF THE CORPORATION TO INDICATE THAT THE PRICE QUOTED THEREIN FOR ITEM 33 WAS INTENDED FOR ITEM 34. HIS REPORT THE CONTRACTING OFFICER STATES THAT THE PRICE RANGE FOR PHOTOGRAPHIC ITEMS IN GENERAL, RECEIVED FOR PREVIOUS SALES BY HIS OFFICE IS BETWEEN 30 PERCENT AND 67 PERCENT OF THE ACQUISITION COST, WITH AN AVERAGE OF APPROXIMATELY 42 PERCENT. THE ABSTRACT OF BIDS SHOWS THAT THE TWO OTHER BIDS ON ITEM 33 WERE IN THE AMOUNTS OF $41.97 AND $29. ALTHOUGH THE BID SUBMITTED BY THE M.J.R. CORPORATION WAS CONSIDERABLY HIGHER THAN THE NEXT HIGHEST BID RECEIVED ON ITEM 33, IT DOES NOT APPEAR THAT THE DIFFERENCE WAS SO GREAT AS TO HAVE PLACED THE CONTRACTING OFFICER ON NOTICE OF THE PROBABILITY OF ERROR IN THE BID OF THE CORPORATION. IN VIEW OF THE WIDE RANGE OF PRICES ORDINARILY RECEIVED ON WASTE, SALVAGE, AND SURPLUS PROPERTY, A MERE DIFFERENCE IN THE PRICES BID WOULD NOT NECESSARILY PLACE A CONTRACTING OFFICER ON NOTICE OF THE PROBABILITY OF ERROR IN A BID FOR THE PURCHASE OF SUCH PROPERTY, AS WOULD A LIKE DIFFERENCE IN THE PRICES QUOTED ON NEW EQUIPMENT OR SUPPLIES TO BE FURNISHED TO THE GOVERNMENT. PRICES OFFERED TO THE GOVERNMENT FOR ITS SURPLUS PROPERTY ARE BASED MORE OR LESS UPON THE USE TO WHICH THE PROPERTY IS TO BE PUT BY THE PARTICULAR BIDDER OR UPON THE RISK OF RESALE WHICH THE BIDDER MIGHT WISH TO TAKE. SEE UNITED STATES V. SABIN METAL CORP., 151 F.SUPP. 683, AFFIRMED 253 F.2D 956, CITING WITH APPROVAL 16 COMP. GEN. 596; 17 ID. 601. IN THE SABIN CASE, SUPRA, THE PRICE DISPARITY ON THE BIDS RECEIVED FOR THE SALE OF SURPLUS PROPERTY RANGED FROM A LOW OF $337.28 TO A HIGH OF $9,351.30. THE COURT, AT PAGE 688, SAID:

"THIS BEING A SALE OF SURPLUS ENGINE PARTS, THE CONTRACTING OFFICER HAD NO METHOD OF KNOWING THAT THERE WAS AN ERROR IN THE DEFENDANT'S BID. THE GOVERNMENT WAS INTERESTED ONLY IN GETTING THE HIGHEST POSSIBLE PRICE FOR THE MATERIAL TO BE SOLD; IT WAS NOT IN THE METAL TRADE. THERE IS NO REASON WHY THE SPREAD IN BIDS SHOULD HAVE APPEARED PALPABLE TO THE GOVERNMENT. THE ADMINISTRATIVE AGENCY WAS NOT REQUIRED TO EMPLOY OR UTILIZE EXPERTS FOR THE BENEFIT OF THE DEFENDANT, NOR TO ASSUME THE BURDEN OF EXAMINING EVERY LOW BID FOR POSSIBLE ERROR BY THE BIDDER.'

IN VIEW OF THE FOREGOING AND AS NO ERROR WAS ALLEGED UNTIL AFTER AWARD AND THE BID WAS CLEAR AND UNAMBIGUOUS, IT MUST BE CONCLUDED THAT THE ACCEPTANCE OF THE BID OF M.J.R. CORPORATION WAS MADE IN GOOD FAITH AND CONSUMMATED A VALID AND BINDING CONTRACT WHICH FIXED THE RIGHTS AND LIABILITIES OF THE PARTIES. THE RESPONSIBILITY FOR THE PREPARATION OF THE BID SUBMITTED IN RESPONSE TO THE INVITATION WAS UPON THE BIDDER. SEE FRAZIER-DAVIS CONSTRUCTION CO. V. UNITED STATES, 100 CT.CL. 120, 163. ANY ERROR THAT WAS MADE IN THE BID OF THE CORPORATION WAS UNILATERAL--- NOT MUTUAL--- AND DOES NOT ENTITLE THE CORPORATION TO RELIEF FROM ITS OBLIGATION UNDER THE CONTRACT. SEE OGDEN AND DOUGHERTY V. UNITED STATES, 102 CT.CL. 249; AND SALIGMAN, ET AL. V. UNITED STATES, 56 F.SUPP. 505, 507. ..END :