Case study: Bidding pricing error

2. UNITED STATES ARMY
CORPS OF ENGINEERS
ARANGO
CONSTRUCTION CO.
1. SUCCESS ROOFING INC.
2. CLEO ROOFING
3. TIN BENDERS

3. Arango Construction Co. called a subcontracting bid for technical
equipment shop roof construction at Fort Lewis, Washington.
Success Roofing Inc. employ Estimates Inc. to calculate the bid amount
which was $34659 for only 7A & 7B roofing and submitted the bid.
For the same sections job Tin Binders had quoted $38500.
Success bid was low, they got the project.
Later they rechecked and found the bid price was too less than the
normal price.
The same sections job was agreed to perform work by CLEO Roofing
at the price $54733.

4. 6th Dec, 1983
Success Roofing
Inc. submitted a
telephone bid for
roofing of 7A & 7B
to prime
contractor Arango
Const. Co.
8th Dec, 1983
Arango Const. Co.
informed to
Success Roofing
Inc. delay in bid
opening and asked
for reconfirmation
of bid.
21st Dec, 1983
Arango Const. Co.
resubmitted the
prime bid and bids
were opened.
12th Jan, 1984
United States Army
Corps of Engineers
awarded the
contract to Arango
Const. Co.
30th Jan, 1984
Arango Const. Co.
notified Success
Roofing Inc. by
sending sub-
contract form for
signature.
6th Feb, 1984
Success asked for
specification and
plan while another
sub-contractor Cleo
Roofing completed
roofing of 7C, 7E &
7F.
13th Fab, 1984
Success Roofing
Inc. found an error
in bid price and
refused to work at
quoted price over
the phone.
16th Fab, 1984
Success Roofing
Inc. wrote to
Arango Const. Co.
for withdraw the
previous bid and
explained the
error.
30th Apr, 1984
Arango Const. Co.
filed case against
Success Roofing
Inc. for breach of
contract.
07th May, 1984
Arango Const. Co.
awarded contract
of roofing work at
7A & 7B to Cleo
Roofing.