BNUMBER: B-274866
DATE: December 9, 1996
TITLE: Murray Service Company t/a EMD Mechanical Specialists
**********************************************************************
Matter of:Murray Service Company t/a EMD Mechanical Specialists
File: B-274866
Date:December 9, 1996
Andrew N. Cook, Esq., Bell, Boyd & Lloyd, for the protester.
Marian E. Sullivan, Esq., Paul Warring, Esq., Frank Miller, Esq., and
John Lariccia, Esq., Department of the Air Force, for the agency.
Jennifer D. Westfall-McGrail, Esq., and Christine S. Melody, Esq.,
Office of the General Counsel, GAO, participated in the preparation of
the decision.
DIGEST
Agency may accept a bid that, while containing discrepancies between
line item prices and total prices, is low under all reasonable
interpretations and where the bidder has presented clear and
convincing evidence of the intended bid price.
DECISION
Murray Service Company t/a EMD Mechanical Specialists protests the
award of a contract to Superior Management Services (SMS) under
invitation for bids (IFB)
No. F49642-96-B-0060, issued by the Department of the Air Force for
alteration and repair of a chilled water system at Bolling Air Force
Base. The protester argues that SMS's bid should not have been
accepted since its price is ambiguous.[1]
We deny the protest.
BACKGROUND
Twelve bids were received by the September 26, 1996 bid opening date.
SMS was the apparent low bidder with a total price of $2,477,000;
Edward Kocharian, Inc. (whose bid was subsequently determined
nonresponsive) was second low with a price of $2,489,000; and Murray
was third low with a total bid of $2,687,000.
In reviewing SMS's bid, the contracting officer noted a discrepancy in
the amounts entered on its bid schedule. SMS's bid schedule appeared
as follows:
Item No.Bid Description Quantity Unit Unit PriceAmount
0001 Alter 1 JB LS $ 277,000
0002 Repair 1 JB LS $2,200,000
SUBTOTAL (0001-0002) $2,180,000
0003 Total Bond Cost 1 JB LS $ 20,000
TOTAL (0001-0003) $2,477,000
The contracting officer noted that the sum of CLINs 0001, 0002, and
0003 did not equal the total bid entered by SMS on the bid schedule.
In addition, the sum of CLINs 0001 and 0002 did not equal the subtotal
entered and the sum of the subtotal and CLIN 0003 did not equal the
total entered.
The contracting officer contacted SMS immediately and requested that
it either verify its bid price of $2,477,000 or submit a notice of
mistake in bid. SMS responded by verifying its total price of
$2,477,000. In a second letter transmitted the same afternoon, SMS
explained that it had transposed some of the entries on its bid
schedule. It stated that the correct entries should have been as
follows:
Item No. 0001 $ 277,000
Item No. 0002 $2,180,000
Subtotal $2,457,000
Item No. 0003 $ 20,000
Total $2,477,000
With the letter, SMS enclosed a copy of its bid estimate worksheet,
which supported its claim that it had intended to bid the above
amounts.
SMS submitted a third letter the following day, in which it explained
how the transposition error had occurred. An SMS employee had been
dispatched to the bid opening location prior to the time set for
opening. Upon his arrival there, he had contacted SMS's president via
mobile phone to receive final instructions on SMS's intended pricing.
SMS's president first instructed the employee to enter a total bid
price of $2,477,000 on the schedule. Next, the president instructed
the employee to enter the sum $277,000 for item No. 0001. The phone
then disconnected. A second call was placed, and the president
instructed the employee to enter $20,000 for the bid bond item. The
president then instructed the employee to enter $2,180,000 for "the
next bid item," to calculate the subtotal, and to get the bid in on
time. The employee, in his haste to comply, entered $2,180,000 in the
subtotal blank, rather than in the blank for CLIN 0002; he then added
$2,180,000 to the $20,000 that he had entered for CLIN 0003 and
entered the sum (i.e., $2,200,000) in the remaining blank, opposite
CLIN 0002.
After reviewing the information submitted by SMS, including its bid
estimate worksheet and its explanation of how the error had occurred,
the contracting officer concluded that there was clear and convincing
evidence of both mistake and the bid intended. The contracting
officer also noted that SMS was the low bidder, whether considering
its total bid as entered on the bid schedule (i.e., $2,477,000); the
sum of CLINs 0001, 0002, and 0003 (i.e., $2,497,000), or the sum of
the subtotal entry and CLIN 0003 (i.e., $2,200,000). The contracting
officer therefore allowed SMS to correct its bid. On September 30,
the agency awarded a contract to SMS.
DISCUSSION
The protester argues first that the agency should have rejected SMS's
bid as nonresponsive because it is ambiguous as to price.
Although a bid must be rejected as nonresponsive if it is ambiguous
regarding the actual price the government would be obligated to pay
upon acceptance of the bid, BFI Medical Waste Servs., B-266354, Jan.
29, 1996, 96-1 CPD para. 28; Municipal Leasing Sys., Inc., B-242648.2, May
21, 1991, 91-1 CPD para. 495, we apply this rule only in situations in
which the bid price is ambiguous in the sense that it is unclear from
the bid how it should be calculated--for example, where the bidder
bids on the basis of units other than those identified in the bid
schedule under an indefinite quantity solicitation. E.g., BFI Medical
Waste Servs., supra. We apply a different rule in situations, such as
the one here, in which, due to a mistake in one or more of the entries
on the bid form, there are two (or a finite number more) reasonable
interpretations of the intended price. In such cases, a bid which is
ambiguous as to price need not be rejected if it is low under all
reasonable interpretations. NJS Dev. Corp., 67 Comp. Gen. 529 (1988),
88-2 CPD para. 62.
Moreover, if the bid discrepancy can properly be eliminated through
the mistake in bid rules of Federal Acquisition Regulation sec. 14.407-3,
award may be made at the intended price. Here, the contracting agency
found, by clear and convincing evidence, consisting of SMS's bid
estimate worksheet and its plausible explanation of how the error had
occurred, that it was the entries for CLIN 0002 and the subtotal for
CLINs 0001 and 0002 that were in error and that the "total amount was
the intended bid." Since nothing on this record establishes that the
contracting officer's finding of clear and convincing evidence was
unreasonable, we conclude that award to SMS at that total price was
proper.[2]
The protest is denied.
Comptroller General
of the United States
1. The protester also argued in its initial submission that SMS's bid
was unbalanced. The agency responded in its report that SMS's bid was
neither mathematically nor materially unbalanced. The protester, in
commenting on the agency report, does not attempt to rebut the agency
position; we therefore consider it to have abandoned this argument.
Arjay Elecs. Corp., B-243080, July 1, 1991, 91-2 CPD para. 3.
2. Although the protester asserts that in accord with our decision in
Polycast Technology Corp., B-203871, Nov. 2, 1981, 81-2 CPD para. 373, in
which we held that an ambiguous low bid could be accepted where the
bid was low under either interpretation of the ambiguity and the
bidder agreed to accept the interpretation that was most favorable to
the government, award can be made to SMS only at the lowest of the
three interpretations of its bid price, here, as a result of the
evidence presented, there is no ambiguous bid.