4. The Government did not request bid verification or its request for bid verification was inadequate; and
5. Proof of the intended bid is established.”
The Court reviewed the facts of the case against the five elements focusing primarily on item (3). IIA argued that the CO should have compared their initial and final proposals because such a comparison would have revealed the mistake. The Government argued that the CO had neither “actual or constructive knowledge of the mistake”. The Court stated that the CO was not required to compare initial and final proposals. On the other hand, the CO should have been alerted to a possible error in [IIA's] Air Force Base pricing as a result of “Abstract of Proposal/Quotations” to compare [the IIA and Awardee's] final monthly and yearly proposed prices for the five Air Force Bases.”
The Court further stated that “price disparity alone is not enough to impute the CO with constructive notice of a possible error in [a] bid, if there are other factors that reasonably could explain the difference”. The Court went on to state, however, that “the size of the disparity between the IIA's bid and the next lowest bid, as evidenced by the Air Force Base abstract, and the absence of other factors negating an inference of error, should have alerted the CO to the mistake.”
The Court decided that IIA “had established by clear and convincing evidence that the CO should have known of a possible error” in the IIA final proposal revision. Pursuant to the authority cited in the Hamilton case previously decided by the Court of Appeals for the Federal Circuit, the Court in this case reformed the contract and awarded $174,882 plus interest for 2 years to IIA.
The moral of the story here is to check, and double check and triple check your proposals before they are submitted to the Government. You should go to extraordinary efforts to avoid mistakes in your bids or proposals, particularly with regard to prices, and be absolutely certain that you have a Basis of Estimate (“BOE”) and supporting documentation for your proposal. Do not assume that you can “fix” a mistake...
