## Facts

- The Navy solicited sealed bids for construction of an electrical substation in Louisville, Kentucky.
- McClure Electrical’s president made an internal transposition error when preparing the final bid recap, causing the bid to be $16,530 lower than intended.
- McClure submitted the apparent low bid (about $145,000), far below the government estimate ($282,869) and below the next-lowest bid by roughly $28,000.
- The contracting officer suspected a mistake due to the disparity and sent a written request asking McClure to review its bid worksheets for possible errors or omissions.
- The request included an abstract of offers showing competing bids and the government estimate, all substantially higher than McClure’s bid.
- After review, McClure responded in writing confirming the bid’s accuracy.
- The Navy awarded the contract; McClure performed and completed the work.
- After completion, McClure discovered the internal mistake and sought reformation of the contract price based on unilateral mistake.

## Issues

1. Whether the contracting officer’s written verification request (including comparative bid information) satisfied the FAR requirements for suspected mistakes in bids.
2. Whether a bidder may obtain contract reformation for a unilateral bid mistake when, after a reasonable verification request, the bidder affirmatively confirms its bid in writing.

## Decision

- The Federal Circuit affirmed the Armed Services Board of Contract Appeals’ decision denying reformation.
- The court held the verification request, considered with the enclosed abstract of offers and government estimate, adequately alerted McClure to a possible mistake under the FAR.
- The court held that McClure’s written confirmation of its bid, after receiving the verification request and comparative pricing data, barred reformation for the later-discovered unilateral mistake.

## Legal Principles

- When a contracting officer suspects a bid mistake, the FAR requires a verification request sufficient to put the bidder on notice and allow review before award; the government need not identify the precise nature of the suspected error.
- Providing comparative pricing information (other bids and the government estimate) can satisfy the FAR’s notice function when coupled with an explicit request to check for errors or omissions.
- Reformation for unilateral mistake generally requires that the government knew or should have known of the mistake and failed to take appropriate steps; if the government reasonably seeks verification and the bidder confirms the bid, the government may rely on that confirmation.
- After adequate verification and an unequivocal confirmation, the risk of any remaining unilateral mistake rests with the bidder.

## Conclusion

The Federal Circuit held that the Navy satisfied its FAR duty by requesting bid verification and supplying comparative pricing information, and that McClure’s written confirmation of its low bid prevented contract reformation for a unilateral pricing mistake discovered after performance.


McClure Elec. Constructors, Inc. v. Dalton, 132 F.3d 709 (Fed. Cir. 1997)