B-158675, MAR. 30, 1966

B-158675, MAR. 30, 1966

TO THE SECRETARY OF THE INTERIOR:

REFERENCE IS MADE TO A LETTER DATED MARCH 4, 1966, FROM THE DEPUTY ASSISTANT SECRETARY FOR ADMINISTRATION, TRANSMITTING A LETTER OF FEBRUARY 11, 1966, FROM THE CHIEF ENGINEER OF THE BUREAU OF RECLAMATION CONCERNING THE VALIDITY OF A CLAIM SUBMITTED BY ASEA ELECTRIC, INCORPORATED, 55 NEW MONTGOMERY STREET, SAN FRANCISCO, CALIFORNIA. THE CLAIM IS PREDICATED UPON A MISTAKE IN BID ALLEGED AFTER AWARD OF CONTRACT NO. 14-06-D-5427 BY THE OFFICE OF THE CHIEF ENGINEER, BUREAU OF RECLAMATION, DENVER, COLORADO, WHICH PROVIDED FOR THE FURNISHING, INSTALLING, AND TESTING OF SYNCHRONOUS MOTORS FOR MILE 18 PUMPING PLANT, CENTRAL VALLEY PROJECT, CALIFORNIA.

SPARE PART NO. 9 OF THE SUBJECT CONTRACT WAS DESCRIBED AS "ONE ARMATURE FOR MAIN EXCITER, COMPLETE WITH SHAFT AND COMMUTATOR.' ASEA'S RESPONSIVE LOW BID TOTALLED $3,094,000, AND INCLUDED A TOTAL BID PRICE FOR SPARE PARTS OF $30,000. HOWEVER, AN APPARENT ERROR IN ADDITION OF THE SPARE PARTS PRICES WAS DETECTED, AND THE TOTAL SPARE PARTS BID WAS LOWERED TO $16,725. THE TOTAL CONTRACT BID WAS ACCORDINGLY REVISED TO $3,080,725.

ASEA, BY A SWORN STATEMENT SIGNED BY MR. FRED F. RUEGG, REGIONAL MANAGER, ALLEGED THAT THE $1,475 BID SUBMITTED ON SPARE PART NO. 9 WAS INCORRECT AND THAT $14,750 SHOULD HAVE BEEN STATED, BUT IN TRANSCRIBING THE AMOUNT FROM THE WORKSHEET TO THE BID DOCUMENT A ZERO WAS INADVERTENTLY OMITTED. IF $14,750 IS SUBSTITUTED IN PLACE OF THE $1,475 FIGURE, THE ORIGINAL SPARE PARTS TOTAL OF $30,000 WOULD BE MATHEMATICALLY CORRECT. ACCORDINGLY, ASEA HAS REQUESTED THAT THE CONTRACT PRICE BE REVISED UPWARDS BY $13,275 SO AS TO REFLECT THEIR TRUE INTENT.

IT IS WELL SETTLED THAT WHEN A BIDDER HAS MADE A MISTAKE AND THE BID HAS BEEN ACCEPTED HE MUST BEAR THE CONSEQUENCES THEREOF, UNLESS THE MISTAKE WAS MUTUAL OR SO APPARENT THAT IT MUST BE PRESUMED THE CONTRACTING OFFICER KNEW OF THE MISTAKE AND SOUGHT TO TAKE ADVANTAGE THEREOF. SEE 3 COMP. GEN. 821, 23 ID. 596.

THE SEVEN OTHER SPARE PARTS BID TOTALS WERE AS FOLLOWS:

CHART

AMERICAN ELIN CORPORATION $25,000

MITSUI AND COMPANY, LIMITED 33,703

ALLIS-CHALMERS MANUFACTURING COMPANY 34,800

WESTINGHOUSE ELECTRIC CORPORATION 41,819

GENERAL ELECTRIC 46,857

HITACHI NEW YORK, LIMITED 68,835

BROWN BOVERI CORPORATION 71,650

AS THE ABOVE ABSTRACT READILY SHOWS, THE ALTERED BID FIGURE OF $16,725 IS DISPROPORTIONATELY LOW AND OUT OF LINE WITH THE OTHER BIDS, ESPECIALLY WHEN VIEWED IN CONJUNCTION WITH ASEA'S ORIGINAL $30,000 BID WHICH WAS WELL WITHIN THE ESTABLISHED RANGE. CONSEQUENTLY, IT APPEARS THAT THE CONTRACTING OFFICER SHOULD HAVE BEEN PLACED ON NOTICE OF THE PROBABILITY OF ERROR IN THE BID OF ASEA AND THE CORPORATION SHOULD HAVE BEEN REQUESTED TO VERIFY ITS BID PRIOR TO THE ACCEPTANCE THEREOF. MOREOVER, THE EVIDENCE OF RECORD CLEARLY ESTABLISHES THE ERROR ALLEGED.

IN VIEW THEREOF AND SINCE ASEA WOULD REMAIN THE LOW BIDDER IF ITS BID IS CORRECTED, THE CONTRACT MAY BE MODIFIED TO REFLECT THE INCREASE OF $13,275 AS REQUESTED BY ASEA.