B-174257, DEC 28, 1971

B-174257, DEC 28, 1971

CONTRACTS - ALLEGED MISTAKE - RELIEF DENIED RELIEF DENIED CONCERNING AN ALLEGED ERROR IN BID BY PRO CON, INC. FOR THE CRUSHING AND STOCKPILING OF ROAD SURFACING AGGREGATE ON AN IFB ISSUED BY THE FOREST SERVICE. THE CONTRACT IS BINDING AND VALID SINCE PRO CON'S ASSUMPTION THAT IT WOULD BE PERMITTED TO USE AN ALTERNATIVE SOURCE OF THE ROAD SURFACING MATERIAL WAS A UNILATERAL ERROR AND DOES NOT ENTITLE THE COMPANY TO RELIEF.

TO MR. SECRETARY:

REFERENCE IS MADE TO A LETTER DATED OCTOBER 1, 1971, REFERENCE 6320 CONTRACTING, FROM THE CHIEF OF PROCUREMENT MANAGEMENT, ADMINISTRATIVE SERVICES, FOREST SERVICE, REQUESTING OUR OFFICE TO DECIDE WHETHER RELIEF MAY BE GRANTED IN CONNECTION WITH AN ERROR ALLEGED TO HAVE BEEN MADE IN THE BID OF PRO CON, INC., WHICH IS THE BASIS OF CONTRACT NO. 003278S.

INVITATION FOR BIDS R6-18-71-42 WAS ISSUED ON JUNE 7, 1971, FOR THE CRUSHING AND STOCKPILING OF 20,000 CUBIC YARDS OF ROAD SURFACING AGGREGATE. PARAGRAPH (I) OF THE "SUPPLEMENTAL INSTRUCTIONS AND CONDITIONS TO SF 33A" URGED BIDDERS "TO INSPECT THE PIT AND DELIVERY SITES PRIOR TO SUBMISSION OF BID." IN REGARD TO THE AVAILABLE SOURCE OF ROCK FOR CRUSHING AND THE LOCATION OF THE STOCKPILE, THE SOLICITATION'S GENERAL SPECIFICATIONS PROVIDED:

"120 - LOCATION OF PROJECT - CASE I SOURCE AND STOCKPILE SITE

"121 MATERIAL FOR CRUSHING IS LOCATED IN A CASE I SOURCE ON NATIONAL FOREST LAND IN SECTION 22, T.15S., R.5E.; LANE COUNTY, OREGON, APPROXIMATELY 3 1/2 MILES NORTHEAST OF THE UPPER END OF BLUE RIVER LAKE NEAR ROAD #1533, APPROXIMATELY ONE MILE OFF ROAD #1502.

"122 THE STOCKPILE SITE IS ON ROAD #149C APPROXIMATELY ONE-HALF MILE NORTHEAST OF ITS JUNCTION WITH ROAD #149.

"123 THE LOCATIONS OF THE CASE I SOURCE AND THE STOCKPILE SITE ARE SHOWN ON THE ATTACHED MAP.

"130 - CHANGE OF CASE I SOURCE

"131 SHOULD IT DEVELOP THAT THE CASE I SOURCE OF SUPPLY CONTAINS INSUFFICIENT OR UNSATISFACTORY MATERIAL TO MEET CONTRACT NEEDS AND SPECIFICATIONS, THE GOVERNMENT WILL PROVIDE ANOTHER SOURCE, IN WHICH EVENT AN EQUITABLE ADJUSTMENT WILL BE MADE FOR PAYMENT FOR MATERIALS FROM THE NEW SOURCE AND EXTENSION OF TIME, IF REQUIRED.

"132 IF THE CONTRACTOR CHOOSES TO FURNISH MATERIAL FROM ANY OTHER SOURCE AND IT IS SUBSEQUENTLY FOUND THAT THE QUANTITY OF ACCEPTABLE MATERIAL PRODUCIBLE THEREFROM IS NOT SUFFICIENT TO FULFILL THE NEEDS OF THE CONTRACT WORK AND A CHANGE OF SOURCE IS NECESSARY FOR THAT REASON, OR IF THE CONTRACTOR CHOOSES FOR SOME OTHER REASON TO CHANGE THE SOURCE FROM WHICH MATERIAL IS TO BE FURNISHED, THE CHANGE IN SOURCE SHALL NOT BE CONSIDERED TO INVOLVE OR CONSTITUTE REASON FOR AN INCREASE OR DECREASE IN THE AMOUNT DUE THE CONTRACTOR OR ANY ADJUSTMENT THEREOF, EXCEPT THE PAYMENT FOR ACTUAL QUANTITIES PRODUCED AND ACCEPTED FROM ONE OR SEVERAL APPROVED SOURCES AT THE ORIGINAL CONTRACT PRICE."

THE FOLLOWING BIDS WERE RECORDED AT THE BID OPENING ON JUNE 21, 1971:

PRO CON, INC. $ 62,060.00

LLOYD M. HILL CO. 79,600.00

L. V. ANDERSON 96,960.00

W. H. GREGORY 112,168.87

THE GOVERNMENT ESTIMATE WAS $57,010. NO REQUEST FOR VERIFICATION OF PRO CON'S BID PRICE WAS MADE, SINCE THE BID EXCEEDED THE GOVERNMENT ESTIMATE BY 9 PER CENT. AWARD OF CONTRACT NO. 003278S WAS MADE TO PRO CON ON JUNE 25.

ON JULY 6, PRO CON REQUESTED A CHANGE IN THE PIT SOURCE. IN SUPPORT OF ITS REQUEST, PRO CON ALLEGED THAT IT HAD INVESTIGATED THE SOURCE DESIGNATED IN THE ABOVE-QUOTED GENERAL SPECIFICATIONS AND HAD CONCLUDED THAT AN ALTERNATE SOURCE WOULD BE LESS EXPENSIVE TO DEVELOP. PRO CON'S BID WAS SUBMITTED ON THE BASIS OF BEING ABLE TO USE THIS ALTERNATE SOURCE AND COST SAVINGS OF $9,408 WHICH COULD BE REALIZED THEREBY WERE REFLECTED IN ITS BID PRICE. PRO CON STATED IT ASSUMED IT WOULD BE PERMITTED TO USE THE ALTERNATE SOURCE SINCE IT PRESENTLY HELD A SUBCONTRACT WITH A TIMBER PURCHASER TO CRUSH 5,000 CUBIC YARDS OF AGGREGATE FROM THIS SOURCE.

IT IS ADMINISTRATIVELY REPORTED THAT THE ALTERNATE SOURCE, WHICH PRO CON ASSUMED IT WOULD BE PERMITTED TO USE, IS LOCATED IN AN EXPERIMENTAL FOREST IN WHICH DISTURBANCE TO STUDY AREAS MUST BE HELD TO A MINIMUM. THE PRODUCTION OF THE 5,000 CUBIC YARDS OF CRUSHED ROCK OBLIGATED UNDER THE TIMBER SALE WAS TO BE FROM LOOSE MATERIAL EXISTING AT THE SITE, ELIMINATING THE NEED FOR ADDITIONAL QUARRYING OR PIT DEVELOPMENT. THE PIT WOULD THEN BE CLOSED TO FURTHER USE. THE EXTENSIVE DEVELOPMENT OF THE PIT WHICH WOULD BE REQUIRED UNDER THE INSTANT CONTRACT WOULD ENCROACH ON REFERENCE STANDS OF TIMBER, EXPERIMENTAL WATERSHEDS AND OTHER RESEARCH PROJECTS. THEREFORE, PRO CON'S REQUEST FOR A CHANGE IN PIT SOURCE WAS DENIED.

THE PRIMARY QUESTION FOR CONSIDERATION IS NOT WHETHER AN ERROR WAS MADE IN PRO CON'S BID BUT WHETHER A VALID AND BINDING CONTRACT WAS CONSUMMATED BY ITS ACCEPTANCE. THE CONTRACTING OFFICER HAS REPORTED THAT HE HAD NO REASON TO SUSPECT AN ERROR IN PRO CON'S BID, IN VIEW OF THE WIDE VARIANCE AMONG THE BIDS AND THE FACT THAT PRO CON'S BID EXCEEDED THE GOVERNMENT ESTIMATE, WHICH WAS BASED UPON USE OF THE SOURCE DESIGNATED IN THE SPECIFICATIONS. AT THE TIME OF ACCEPTANCE OF PRO CON'S BID, THE CONTRACTING OFFICER HAD RECEIVED NO NOTICE OF CLAIM OF ERROR, AND WE AGREE WITH THE ADMINISTRATIVE VIEW THAT THE CIRCUMSTANCES WERE NOT SUCH AS TO PLACE THE CONTRACTING OFFICER ON NOTICE OF THE LIKELIHOOD OF ERROR IN THE BID. IT THEREFORE APPEARS FROM THE PRESENT RECORD THAT THE ACCEPTANCE OF PRO CON'S BID WAS IN GOOD FAITH, NO ERROR HAVING BEEN ALLEGED BY IT UNTIL AFTER AWARD. THE ACCEPTANCE OF THE BID, UNDER THE CIRCUMSTANCES INVOLVED, CONSUMMATED A VALID AND BINDING CONTRACT WHICH FIXED THE RIGHTS AND LIABILITIES OF THE PARTIES THERETO.

THE RESPONSIBILITY FOR THE PREPARATION OF THE BID SUBMITTED IN RESPONSE TO THE INVITATION WAS UPON THE BIDDER. FRAZIER-DAVIS CONSTRUCTION CO. V UNITED STATES, 100 CT. CL. 120, 163 (1943). WHILE IT MAY BE THAT AN ERROR WAS MADE IN THE BID, IT IS CLEAR THAT SUCH ERROR WAS DUE SOLELY TO PRO CON'S OVERSIGHT OR NEGLIGENCE AND WAS IN NO WAY INDUCED OR CONTRIBUTED TO BY THE GOVERNMENT. IN THIS CONNECTION, WE DO NOT VIEW THE INVITATION SPECIFICATIONS AS ASSURING THAT THE ALTERNATE SOURCE WOULD BE AVAILABLE FOR USE IN THE PERFORMANCE OF THE INSTANT CONTRACT, AND PRO CON HAS NOT ALLEGED THAT ANY GOVERNMENT REPRESENTATIVE GAVE IT SUCH ASSURANCE. ANY ERROR THAT WAS MADE IN THE BID UPON THE ASSUMPTION THAT THE ALTERNATE SOURCE WOULD BE AVAILABLE WAS THEREFORE UNILATERAL - NOT MUTUAL - AND, DOES NOT ENTITLE PRO CON TO RELIEF. SEE DOUGHERTY & OGDEN V UNITED STATES, 102 CT. CL. 249 (1944).

ACCORDINGLY, NO LEGAL BASIS EXISTS FOR RELIEVING PRO CON FROM ITS OBLIGATION TO FURNISH THE AGGREGATE AT THE CONTRACT PRICE, OR FOR INCREASING THE CONSIDERATION UNDER THE CONTRACT.