Chapter 4 - § 4.9 • MISTAKES IN BIDS

• Jurisdiction: Colorado

§ 4.9 • MISTAKES IN BIDS

Colorado has specific statutory guidance for correcting or withdrawing mistaken bids on state construction projects. Both the Colorado Construction Bidding for Public Projects Act and Colorado Procurement Code provide:

Withdrawal of inadvertently erroneous bids before the award may be permitted pursuant to rules if the bidder submits proof of evidentiary value which clearly and convincingly demonstrates that an error was made. Except as otherwise provided by rules, all decisions to permit the withdrawal of bids based on such bid mistakes shall be supported by a written determination made by the responsible officer.¹³³

When it appears from a review of the bid or proposal that a mistake has been made, the procurement agent should request that the bidder or offeror confirm the bid or proposal.¹³⁴ The procurement official or his or her designee may waive minor informalities or allow the bidder or offeror to correct them, depending on which option is in the best interest of the state.¹³⁵ "Minor informalities" are defined as "matters of form rather than substance, which are evident from the bid or proposal document, or insignificant mistakes that can be waived or corrected without prejudice to other bidders or offerors; that is, the effect on price, quantity, quality, delivery, or contractual conditions is negligible."¹³⁶

If a mistake is clearly evident on the face of the bid or proposal document, the bid or proposal may not be withdrawn solely for this reason.¹³⁷ Examples include typographical errors, errors in extending unit prices, mathematical errors, and transposition errors.¹³⁸ If the mistakes are attributable to an error in judgment, the bid or proposal may not be corrected.¹³⁹ The procurement official or his or her designee must support by written determination any decision to permit or deny correction of a bid or proposal.¹⁴⁰

A bidder's surety frequently gets involved in a bid mistake because, in general, the surety's issuance of a bid bond does not require the surety to issue the performance and payment bonds. The result may be that the surety refuses to issue the performance and payment bonds, pays the owner the amount of the bid bond, and then seeks recovery from the bidder on its general indemnity agreement.¹⁴¹

Problems with errors in bids also may arise with a subcontractor's or supplier's bid to a general contractor. However, if the general contractor reasonably relied upon the bid, the doctrine of promissory...