Rhode Island Tool Company v. United States

128 F. Supp. 417, 130 Ct. Cl. 698, 1955 U.S. Ct. Cl. LEXIS 61
CourtUnited States Court of Claims
DecidedFebruary 8, 1955
Docket49913
StatusPublished
Cited by23 cases

This text of 128 F. Supp. 417 (Rhode Island Tool Company v. United States) is published on Counsel Stack Legal Research, covering United States Court of Claims primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Rhode Island Tool Company v. United States, 128 F. Supp. 417, 130 Ct. Cl. 698, 1955 U.S. Ct. Cl. LEXIS 61 (cc 1955).

Opinions

JONES, Chief Judge.

Plaintiff sues for the recovery of $1,-640.60 on the ground that it made a mistake in figuring its bid for the furnishing of certain bolts. It also alleges that it withdrew its bid before it received notice of award.

On September 10, 1948, in response to an invitation to bid, plaintiff submitted a bid on a number of items contained in the invitation, the items being numbered 1 through 15. Items 1 through 12 referred to bids for a special type of bolts, “Bolts: Stud.” Items 13, 14, and 15 referred to a special type of bolts, “Bolts: Machine.” Items 1 to 12 were listed on the first and second pages of the invitation, while items 13 to 15 referred to machine bolts which were listed on the third page of the invitation which consisted of four legal-size pages stapled at the top. The change in the description of the type of bolts from stud to machine was on the top line of the third page.

The sales manager of the plaintiff who prepared its bid failed to notice the change in the description of the bolts from stud to machine on the third page and calculated plaintiff’s bid on the basis of stud bolts. The machine bolts were a more expensive type of bolt.

[418]*418The defendant divided the contract, awarding the first 12 items to another contractor, and awarding the last three items covering machine bolts to the plaintiff. Notice of award to plaintiff was mailed on October 4, 1948.

The invitation to bid contained the following provision:

“The successful bidder will receive Notice of Award at the earliest possible date, and such Award will thereupon constitute a binding contract between the bidder and the Government without further action on the part of the bidder.” [Italics supplied.]

The notice of award provided:

“This contract, executed as of the above date of the acceptance of your Bid, comprises the following documents :
“(a) the Government’s Invitation for Bids,
“(b) your Bid,
“(c) the Schedule,
“(d) the General Provisions, and “(e) the Government’s Award.
“No further contractual document is necessary for the consummation of this contract.”

The plaintiff discovered its error late on Friday afternoon, October 1, and on the first working day thereafter, Monday, October 4, 1948, plaintiff’s sales manager communicated with plaintiff’s representative in Philadelphia, who immediately telephoned the Aviation Supply Office of the Navy Department in Philadelphia, notifying that office of plaintiff’s error and that it desired to withdraw its bid. Later the same day the company wired the Supply Office that it was withdrawing its bid on Items 13, 14, and 15. The record does not show whether the notice of award was mailed before or after the telephone conversation in which plaintiff advised the defendant of its mistake and asked to withdraw its bid. It was received by plaintiff after the telegram of withdrawal had been sent.

On October 6, 1948, Lt.(jg.) W. H. Underwood, Jr., wrote plaintiff acknowledging its telegram and advising that the bid could not be withdrawn after the opening date, and that the award had been mailed to plaintiff on October 4, 1948.

The catalogs and lists of record show that machine bolts are a more expensive type of bolt than the stud bolts. There is no question but that a mistake was made and that plaintiff submitted its bid upon the belief that the invitation to bid was for stud bolts and overlooked the fact that the last part of the invitation was for the more expensive type of bolt.

A rather well-established rule of law seems to be that after bids have been opened the bidder cannot withdraw his bid unless he can prove that the desire to withdraw is due solely to an honest mistake and that no fraud is involved. United States v. Lipman, D.C., 122 F.Supp. 284, 287; Alta Electric and Mechanical Co., Inc., v. United States, 90 Ct.Cl. 466; Leitman v. United States, 60 F.Supp. 218, 104 Ct.Cl. 324; Nason Coal Co. v. United States, 64 Ct.Cl. 526; Moffett, Hodgkins & Clarke Co. v. City of Rochester, 178 U.S. 373, 20 S.Ct. 957, 44 L.Ed. 1108. The case of Refining Associates, Inc., v. United States, 124 Ct.Cl. 115, cited by both parties and emphasized by the defendant, is inapplicable to the facts of this case. No mistake was found to exist in that case. In fact, in that case the court recognized that on many occasions it has granted relief to plaintiffs seeking to withdraw or modify a bid after the date of the opening. It cites and discusses several such cases and distinguishes them from that particular case. In the instant case the plaintiff on account of its mistake had a right to withdraw its bid, provided a binding contract had not yet been made.

The question is whether, in all the circumstances of this case, the depositing of the notice of award in the mail constitutes a binding contract from which plaintiff cannot escape, notwithstanding the mistake was brought to the attention [419]*419of the contracting officials before the notice of award was received.

We believe that when the record is considered as a whole in the light of modern authorities, there was no binding contract, since plaintiff withdrew its bid before the acceptance became effective.

Under the old post office regulations when a letter was deposited in the mail the sender lost all control of it. It was irrevocably on its way. After its deposit in the mail the post office became, in effect, the agent of the addressee. Naturally the authorities held that the acceptance in any contract became final when it was deposited in the post office, since the sender had lost control of the letter at that time. That was the final act in consummating the agreement.

But some years ago the United States Postal authorities completely changed the regulation. It read as follows in 1948:

“Withdrawal by sender before dispatch, (a) After mail matter has been deposited in a post office it shall not be withdrawn except by the sender, * * *
“Recall of matteY after dispatch. (a) When the sender of any article of unregistered mail matter desires its return after it has been dispatched from the mailing office application shall be made to the postmaster at the office of mailing. * * *
“(b) When application has been made in due form for the recall of an article of mail matter the postmaster shall telegraph a request to the postmaster at the office of address, or to a railway postal clerk in whose custody the matter is known at the time to be, for the return of such matter to his office, carefully describing the same, so as to identify it and prevent the return of any other matter. * * *
“(c) On receipt of a request for the return of any article of mail matter the postmaster or railway postal clerk to whom such request is addressed shall return such matter a penalty envelope, to the mailing postmaster, who shall deliver it to the sender upon payment of all expenses and the regular rate of postage on the matter returned * * [39 CFR 10.09, 10.10 (1939 Ed.)] in

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Rhode Island Tool Company v. United States
128 F. Supp. 417 (Court of Claims, 1955)

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Bluebook (online)
128 F. Supp. 417, 130 Ct. Cl. 698, 1955 U.S. Ct. Cl. LEXIS 61, Counsel Stack Legal Research, https://law.counselstack.com/opinion/rhode-island-tool-company-v-united-states-cc-1955.