BNUMBER: B-265659
DATE: December 18, 1995
TITLE: Bay Pacific Pipelines, Inc., Ranger Pipelines, Inc., and
F.W. Spencer & Son, a Joint Venture
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Matter of:Bay Pacific Pipelines, Inc., Ranger Pipelines, Inc., and
F.W. Spencer & Son, a Joint Venture
File: B-265659
Date: December 18, 1995
Robert J. Sciaroni, Esq., and Andrew N. Cook, Esq., Bell, Boyd &
Lloyd, for the protester.
Douglas L. Patin, Esq., and Robert J. Symon, Esq., Spriggs &
Hollingsworth, for Klipper Construction Associates, Inc., an
interested party.
Lucie J. McDonald, Esq., Cynthia S. Guill, Esq., and Christopher
Bellomy, Esq., Department of the Navy, for the agency.
Scott H. Riback, Esq., and David A. Ashen, Esq., Office of the General
Counsel, GAO, participated in the preparation of the decision.
DIGEST
Protest against agency decision to permit awardee to correct obvious
error in unit price is denied where, although the solicitation
provided that unit prices would govern over extended prices in the
event of a discrepancy, comparison of awardee's unit price and
extended price to other prices received and the government estimate
showed the nature of awardee's mistake--the inadvertent addition of a
zero to its unit price--as well as the bid intended; an obviously
erroneous unit price can be corrected to correspond to an extended
price where the corrected unit price is the only reasonable
interpretation of the bid.
DECISION
Bay Pacific Pipelines, Inc., Ranger Pipelines, Inc., and F.W. Spencer
& Son, Inc., a Joint Venture, protest the Department of the Navy's
award of a contract to Klipper Construction Associates, Inc., under
invitation for bids (IFB) No. N62472-95-B-0417, for utility
reconfiguration work at the Philadelphia Naval Shipyard. Bay Pacific
contends that the agency improperly permitted Klipper to correct a
mistake in its bid.
We deny the protest.
The IFB required firms to provide both unit and extended prices for
six line items, each of which included numerous subline items. The
solicitation provided that "[i]n the event there is a difference
between a unit price and the extended total, the unit price will be
held to be the intended bid."
This protest relates only to Klipper's pricing for subline item number
1f for an estimated quantity of 160 street lights. Klipper entered a
unit price of $27,000 per street light and an extended price of
$432,000 for item 1f, even though multiplying Klipper's unit price by
160 would result in an extended price of $4,320,000. After reviewing
the bids, the lowest of which was submitted by Klipper, the
contracting officer concluded that Klipper had made an error in its
unit price for item 1f, and in particular, had inadvertently added an
extra zero to its intended unit price, which the contracting officer
determined was $2,700. The contracting officer based his conclusion
on a comparison of Klipper's pricing for this item with the other bids
received--with unit prices ranging from $2,055 to $3,240 and extended
prices ranging from $328,800 to $518,400--and the government estimate,
which had been calculated using a unit price of $2,055 and an extended
price of $328,800.
The contracting officer wrote to Klipper stating that he suspected a
mathematical error in its pricing for item 1f. The contracting
officer requested that Klipper either confirm the unit price or state
that a mistake had been made; in the event Klipper alleged a mistake,
he also requested that it provide a detailed explanation of how the
mistake occurred and any documentation (such as Klipper's original bid
worksheets) which might evidence the bid actually intended. In
response, Klipper explained that an extra zero had been inadvertently
added to its unit price for item 1f when Klipper's employee at the bid
opening incorrectly transcribed the unit price received over the
telephone. Klipper included a copy of the bid schedule it had used to
prepare the bid, as well as copies of two subcontractor quotes showing
unit prices of $3,300 and $1,675 for the work included in item 1f.
Klipper explained that it had split the difference between these
quotes and rounded off in arriving at its unit price of $2,700. Based
on this confirmation from Klipper and his earlier conclusion that an
error in the unit price had been made, the contracting officer
permitted correction of Klipper's bid to reflect a unit price of
$2,700 for item 1f.
Bay Pacific, noting that the IFB provided that unit price would govern
over extended price in the event of a discrepancy between the two,
argues that Klipper's bid should have been calculated using the unit
price submitted, which would result in an extended price of $4,320,000
for item 1f. Further, Bay Pacific contends that permitting Klipper to
make the correction resulted in displacement of Bay Pacific as the low
bidder and that, therefore, both the mistake and the intended bid must
be apparent from the face of Klipper's bid and the IFB. According to
the protester, the contracting officer improperly considered Klipper's
bid worksheet and subcontractor quotes in determining Klipper's
intended bid.
The protest is without merit. Notwithstanding the solicitation
provision providing that unit prices would govern over extended prices
in the event of a discrepancy, an obviously erroneous unit price can
be corrected to correspond to an extended price where the corrected
unit price is the only reasonable interpretation of the bid. Action
Serv. Corp., B-254861, Jan. 24, 1994, 94-1 CPD 33. Further, the
correction of an obvious mistake is authorized notwithstanding
displacement of a lower bidder, provided the existence of the mistake
and the intended bid are apparent from the face of the bid. Id. In
this regard, the mere fact that a firm provides bid worksheets or
other materials in connection with its claim of a mistake does not
mean that resort to these materials was necessary for the contracting
officer to determine the intended bid. See Blueridge General, Inc.,
71 Comp. Gen. 271 (1992), 92-1 CPD 218; Marine Ways Corp., B-211788,
Aug. 29, 1983, 83-2 CPD 271. A contracting officer may properly
compare a firm's prices to the government estimate and other prices
received, and employ his or her logic and experience in determining
that one price makes sense while another does not. For example, where
a firm's unit price is significantly higher than the government
estimate and the other bids received, and its extended price appears
to be in line with the other bids and the estimate, the contracting
officer may reasonably conclude that the unit price is incorrect and
the extended price reflects the bid intended. Id.
Here, the record shows that Klipper's unit price for item 1f was
grossly out of line with the other prices received and the government
estimate; Klipper's unit price was more that 10 times the price used
for the government estimate and more than 8 times the highest price
received from any other bidder. Its extended price, on the other
hand, was consistent with the other prices received as well as the
government estimate. Further, a logical explanation for the
discrepancy--that Klipper had inadvertently inserted an extra zero in
its unit price--could be discerned from the face of the bid. Under
these circumstances, we find that there was only one reasonable
interpretation of Klipper's bid: that its extended price reflected
its intended bid. In short, an examination of Klipper's bid and a
comparison of that bid to the other prices and the government estimate
showed both the obvious nature of Klipper's mistake and the firm's
intended bid. Thus, correction of Klipper's bid was proper.
The protest is denied.
Comptroller General
of the United States