B-156717, JUN. 14, 1965

B-156717, JUN. 14, 1965

TO AVCO CORPORATION ELECTRONICS DIVISION:

REFERENCE IS MADE TO YOUR LETTER DATED MAY 4, 1965, WITH ENCLOSURES, PROTESTING THE AWARD OF A CONTRACT TO A BIDDER OTHER THAN YOURSELF BY THE AVIATION SUPPLY OFFICE, DEPARTMENT OF THE NAVY, PHILADELPHIA, PENNSYLVANIA, UNDER IFB 383-446-65.

IT APPEARS THAT THE INVITATION FOR BIDS WAS ISSUED ON OCTOBER 30, 1964, FOR THE PROPOSED PROCUREMENT OF DIRECTION FINDER SET COMPONENTS; THAT STEPLADDER BIDS WERE REQUESTED FOR VARIOUS QUANTITIES OF ITEMS 1 AND 2; THAT BIDS WERE OPENED ON DECEMBER 7, 1964, AND SEVEN RESPONSIVE BIDS WERE RECEIVED, WITH YOUR COMPANY AS THE LOWEST OVERALL BIDDER. IT FURTHER APPEARS THAT YOU WERE REQUESTED TO CONFIRM YOUR BID BECAUSE ERROR THEREIN WAS SUGGESTED BY THE DISPARITY IN THE BID PRICES FOR ITEM 1, RECEIVER- INDICATOR. BY LETTER DATED DECEMBER 18, 1964, YOU ALLEGED THAT AN ERROR WAS DISCOVERED IN YOUR BID AND OFFERED TO FURNISH FULL SUBSTANTIATION OF THE ERROR AND A CORRECTED BID PRICE. THE AVIATION SUPPLY OFFICE, BY LETTER DATED DECEMBER 29, 1964, REQUESTED THAT YOU FORWARD FULL PARTICULARS AS TO THE ALLEGED ERROR. IN YOUR LETTER OF JANUARY 8, 1965, YOU STATED THAT THE ERROR IN YOUR BID PRICE WAS CAUSED BY THE OMISSION OF COSTS FOR RELIABILITY TESTING AND THE OMISSION OF COSTS OF CERTAIN PARTS. ACCOMPANYING THE LETTER WERE COPIES OF WORKSHEETS STATED TO BE THE WORKSHEETS FOR ESTIMATING THE BIDS AND WORKSHEETS SHOWING THE RECOMPUTED INTENDED BID PRICES. YOU REQUESTED THAT YOU BE PERMITTED TO CORRECT YOUR BID PRICE. IN RESPONSE TO INQUIRY BY THE NAVY DEPARTMENT, YOU REPLIED BY TELEGRAM DATED APRIL 2, 1965, THAT UNLESS THE REQUEST FOR BID CORRECTION WAS APPROVED, YOU WOULD DECLINE THE AWARD AT THE ORIGINAL BID PRICES SUBMITTED. A COPY OF THE TELEGRAM ACCOMPANIED YOUR LETTER OF MAY 4, 1965, TO OUR OFFICE.

IN YOUR LETTER OF MAY 4, 1965, YOU STATE THAT IT IS YOUR POSITION THAT YOU RESPONDED IN GOOD FAITH TO THE REQUEST TO REVIEW YOUR PROPOSAL, THAT YOU DETERMINED THAT YOUR BID CONTAINED ERRORS AND THAT YOU SUMMARILY RESPONDED IN DETAIL CONCERNING THE ERRORS. ALSO ACCOMPANYING THIS LETTER IS A COPY OF A LETTER DATED JANUARY 8, 1965, WHEREIN IT IS STATED THAT THE MISTAKE IN BID WAS CAUSED BY FAILURE TO INCLUDE FOUR ITEMS OF COST IN THE ORIGINAL PROPOSAL, AS FOLLOWS:

CHART

1. RELIABILITY ENGINEERING COSTS, ALTHOUGH ESTIMATED, THROUGH

ADMINISTRATIVE ERROR WERE NOT INCLUDED ON THE PROPOSED BID SHEET.

2. FAILURE TO INCLUDE PROPER NUMBER OF COUPLERS (FOUR INSTEAD OF

ONE) ON BILL OF MATERIALS WORKSHEET.

3. OMISSION OF 13 METAL PARTS FROM THE BILL OF MATERIALS WORKSHEET

FOR THE INDICATOR.

4. OMISSION OF ONE HAYDEN COUNTER FROM THE BILL OF MATERIALS FOR

THE INDICATOR.

IT ALSO IS STATED THAT SINCE ITEMS 3 AND 4 WERE OMITTED IN THEIR ENTIRETY, THE WORKSHEETS REFLECT NO COSTS WHATEVER FOR THEM IN THE FINAL BID ESTIMATE.

OUR OFFICE HAS TAKEN THE POSITION THAT, TO JUSTIFY CORRECTION OF A BID, THE BIDDER MUST ESTABLISH BY CLEAR AND CONVINCING EVIDENCE THE MANNER IN WHICH THE MISTAKE OCCURRED AND THE PRICE WHICH WAS INTENDED AND WOULD HAVE BEEN SUBMITTED IN THE ABSENCE OF ERROR. SEE 35 COMP. GEN. 279. IN THE PRESENT MATTER THERE IS NO QUESTION THAT AN ERROR WAS MADE IN THE SUBMITTED BID. THE WORKSHEETS EVIDENCE THE FAILURE TO COMBINE THE ESTIMATED COSTS OF ENGINEERING RELIABILITY WITH THE OTHER ITEMS OF COST. HOWEVER, THE WORKSHEETS DO NOT, AND COULD NOT, SHOW THE ITEMS THAT WERE OMITTED, OR THE COSTS THEREOF. HENCE THE PRICE CANNOT BE ASCERTAINED FROM THE WORKSHEETS ALONE. IN THIS CONNECTION IT MAY BE OBSERVED THAT QUOTATION OF A PRICE AT THIS TIME FOR THE OMITTED ITEMS IS OF NO PROBATIVE EFFECT SINCE WE NOTICE THAT ON SEVERAL OF THE WORKSHEETS THE STATEMENT IS MADE THAT "DIFFERENCE BETWEEN THESE FIGURES AND THOSE ON FINAL PRICE SCHEDULE REPRESENTS A MANAGEMENT PRICING DECISION," INDICATING ARBITRARY CHANGES IN COSTS TO BE CHARGED. THIS WOULD, IN A MANNER OF SPEAKING, ENABLE YOU TO HAVE "TWO BITES AT THE APPLE.'

ACCORDINGLY, SINCE THE EVIDENCE SUBMITTED ESTABLISHES THAT AN ERROR WAS MADE IN YOUR BID, BUT DOES NOT, OF ITSELF, INDICATE THE INTENDED BID PRICE, WE MUST DETERMINE THAT YOUR BID MAY NOT BE CORRECTED TO INCLUDE THE STATED OMISSIONS. IN VIEW OF YOUR TELEGRAM OF APRIL 2, 1965, MENTIONED ABOVE, YOUR BID IS CONSIDERED WITHDRAWN.