A disappointed low bidder on a federal government contract brought suit to recover lost profits and expenditures made in preparing his bid. The bids had been solicited under The Armed Services Procurement Act of 1947 which directs that contracts shall be awarded “to that responsible bidder whose bid, conforming to the invitation for bids, will be most advantageous to the Government, price and other factors considered: Provided, That all bids may be rejected when the agency head determines that it is in the public interest so to do.” Seven bids were entered and the contract awarded to the highest bidder. Plaintiff showed that independent tests found plaintiff’s product met specifications as well as the successful high bidder’s product, and also that the same situation had occurred before with the same bidders involved. The government agency awarded the contract on the grounds that the successful bidder was the only one meeting specifications. In the Court of Claims held: Where the government does not invite bids in good faith but invites bids with intent willfully, arbitrarily, and capriciously to disregard its obligation to accept the bid most advantageous to the government, the expenses of preparing such bid may be recovered on the theory that the government impliedly warrants honest consideration of bids submitted. The most interesting facet of this case is that it allows a new form of recovery to an unsuccessful bidder.
V. Thompson Snyder,
Public Contracts—A New Right for an Unsuccessful Bidder,
36 Neb. L. Rev. 612
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