B-136745, AUG. 7, 1958

B-136745, AUG. 7, 1958

TO THE SECRETARY OF THE NAVY:

REFERENCE IS MADE TO A LETTER DATED JUNE 3, 1958, FILE REFERENCE FR 10/MK:MW/L6/P), FROM THE U.S. NAVY REGIONAL ACCOUNTS OFFICE, WASHINGTON, D.C., FORWARDING TO THE CLAIMS DIVISION THE REQUEST OF ROBERT PARNOW, SAN RAFAEL, CALIFORNIA, THAT SALES CONTRACT NO. N228S 27168 BE CANCELED ON ACCOUNT OF AN ERROR ALLEGED TO HAVE BEEN MADE IN HIS BID ON WHICH THE CONTRACT IS BASED. SINCE MR. PARNOW HAS REQUESTED CANCELLATION OF THE CONTRACT, THE MATTER WILL BE DISPOSED OF BY DECISION RATHER THAN CLAIM SETTLEMENT.

THE NAVAL SUPPLY CENTER, OAKLAND, CALIFORNIA, BY SALES LETTER NO. SL-19- 58-228, REQUESTED BIDS FOR THE PURCHASE FROM THE GOVERNMENT OF MISCELLANEOUS SURPLUS ITEMS, INCLUDING LOT NO. 18 WHICH COVERED ONE FOUR- WHEEL WAREHOUSE TRAILER. IN RESPONSE MR. ROBERT PARNOW SUBMITTED A BID DATED FEBRUARY 19, 1958, OFFERING TO PURCHASE THE WAREHOUSE TRAILER COVERED BY LOT NO. 18 AT A PRICE OF $137. THE BID OF MR. PARNOW WAS ACCEPTED AS TO LOT NO. 18 ON FEBRUARY 25, 1958, AND ON THE FOLLOWING DAY, A NOTICE OF AWARD WAS MAILED TO HIM.

IN AN UNDATED LETTER, WHICH WAS RECEIVED BY THE DISPOSAL DIVISION ON MARCH 12, 1958, MR. PARNOW ADVISED THAT THE WAREHOUSE TRAILER AWARDED TO HIM UNDER LOT NO. 18 WAS NOT THE SAME TRAILER AS THE ONE INSPECTED BY HIM PRIOR TO THE SUBMISSION OF HIS BID AND THAT A GOVERNMENT REPRESENTATIVE MUST HAVE SHOWN HIM THE WRONG TRAILER. MR. PARNOW REQUESTED THAT THE CONTRACT BE CANCELED.

THE ABSTRACT OF BIDS INDICATES THAT THE GOVERNMENT'S ORIGINAL ACQUISITION COST OF THE WAREHOUSE TRAILER COVERED BY LOT NO. 18 WAS $178 AND THAT THE TWO OTHER BIDDERS ON LOT NO. 18 QUOTED PRICES OF $10.01 AND $6.11. THUS, THE BID OF MR. PARNOW OF $137 FOR LOT NO. 18 IS COMPLETELY OUT OF LINE WITH THE OTHER BIDS RECEIVED. WHILE A MERE DIFFERENCE IN THE PRICES QUOTED FOR USED GOVERNMENT PROPERTY WOULD NOT NECESSARILY PLACE THE CONTRACTING OFFICER ON NOTICE OF THE PROBABILITY OF ERROR AS WOULD A LIKE DIFFERENCE IN THE PRICES QUOTED ON NEW PROPERTY FOR SALE TO THE GOVERNMENT, IT MUST BE CONCEDED THAT IT IS UNLIKELY THAT A BIDDER, AS HERE, WOULD INTENTIONALLY OFFER FOR USED PROPERTY ALMOST 80 PERCENT OF THE ACQUISITION COST OF THE WAREHOUSE TRAILER. IN THAT REGARD, THE CONTRACTING OFFICER STATES IN HIS REPORT THAT THE DIFFERENCE BETWEEN THE BID OF MR. PARNOW ON LOT NO. 18 AND THE OTHER BIDS THEREON SHOULD HAVE ALERTED HIM TO THE POSSIBILITY OF AN ERROR, BUT THAT DUE TO AN ADMINISTRATIVE ERROR, THE AWARD WAS MADE WITHOUT PRIOR CONFIRMATION FROM THE BIDDER. IN THE CIRCUMSTANCES, IT WOULD APPEAR THAT A REQUEST FOR VERIFICATION OF THE BID WOULD HAVE BEEN IN ORDER BEFORE ITS ACCEPTANCE.

ON THE RECORD, THERE IS NO ROOM FOR DOUBT THAT MR. PARNOW MADE AN ERROR IN HIS BID, AS ALLEGED. ACCORDINGLY, SINCE IT APPEARS THAT HE HAS NOT TAKEN ANY FURTHER STEPS TOWARDS COMPLETION OF THE CONTRACT, CONTRACT NO. N228S-27168 MAY BE CANCELED WITHOUT LIABILITY TO HIM.