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B-185530 1 (1976-01-14)

handle is hein.gao/gaobaddsy0001 and id is 1 raw text is: Q THE COMPTROLLER GENERAL DECISION OF THE UNITED STATES WASHINGTON, D.C. 20548 FILE: B-185530 DATE: January 14,1976 MATTER OF: Franklin Industries DIGEST: Rescission of sales contract for surplus property approved where bid was almost 400 percent above current market appraisal, more than 30 percent above acquisition cost, and more than .15 percent higher than next highest bid, since in such circum- stances contracting officer is charged with construc- tive notice of possibility of error and failed to request verification. Sale No. 27-6021 was issued by the Defense Property Disposal Service, Defense Supply Agency, for the sale of surplus machine tools and shop equipment. The contracting activity requests that the contract (27-6021-326) awarded Franklin Industries on item No. 120 of this sale be rescinded inasmuch as it believes that the contracting officer was on constructive notice of the mistake in bid alleged by Franklin after award.. Twenty bids were received on item No. 120. These ranged from the successful bid of $7,157 to $1.00. The second, third, and fourth high bids were $6,106, $4,650, and $3,167.99, respectively. The acquisition cost of the item (one turret lathe described as used, in fair condition, and in need of repairs) was $5,443; its appraised current market.value was $1,800. Franklin contends that it intended to bid $2,557. The contracting activity states that it does not believe the fact that the bid price of Franklin exceeded the acquisition cost of the item placed the contracting officer on-constructive notice of a mistake in bid since prices bid on machinery sales, in most instances, substantially exceed the acquisition costs of each item. However, it does believe that because the total bid price shown on the face of the bid sheet did not reflect the sum of the individual bids the contracting officer should have discovered this discrepancy and should have requested verification prior to award of all bid prices submitted by Franklin. - 1 -

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