FAR 14.407-4—Mistakes after award.
Plain-English Summary
FAR 14.407-4 addresses what happens when a bidder discovers and raises a mistake in its bid only after award in a sealed bidding procurement. It explains how post-award mistakes are handled under the mistake-in-bid procedures in subpart 33.2, and it distinguishes among the available remedies: contract modification to correct a mistake when doing so benefits the Government and does not change the essential specifications, rescission of the contract, reformation of the contract by deleting the mistaken items or increasing the price in limited circumstances, or leaving the contract unchanged when the evidence is insufficient. The section also sets the evidentiary standard for relief, requiring clear and convincing evidence of the mistake and proof that the mistake was mutual or so obvious that the contracting officer should have been on notice. It requires legal review of proposed determinations and sets out the documentation the contracting officer must collect, including bid copies, worksheets, supplier quotes, price lists, the invitation for bids, bid abstract, contract documents, correspondence, and a detailed contracting officer statement. Finally, it requires the agency to retain a record of the determination, the facts, and the action taken. In practice, this section protects the integrity of sealed bidding while allowing limited equitable relief when the record shows a genuine mistake and the proposed remedy is legally supportable.
Key Rules
Post-award mistakes use 33.2
If a mistake is alleged or discovered only after award, the matter is processed under subpart 33.2 and the special rules in this section. The contracting officer cannot treat it as an ordinary contract administration issue; it must be handled as a formal mistake-in-bid case.
Correction only if favorable
A mistake may be corrected by contract modification only when the correction is favorable to the Government and does not change the essential requirements of the specifications. This is a narrow remedy intended to preserve the bargain without altering the procurement’s basic scope or requirements.
Available post-award remedies
Agencies may determine that the contract should be rescinded, reformed, or left unchanged. Reformation may delete the mistaken items or increase the price only if the corrected price does not exceed the next lowest acceptable bid under the original IFB.
Clear and convincing proof required
Relief under rescission or reformation requires clear and convincing evidence that a mistake was made. The evidence must also show either a mutual mistake or a unilateral mistake so obvious that the contracting officer should have been on notice before award.
Legal counsel coordination required
Each proposed determination must be coordinated with legal counsel under agency procedures. This ensures the proposed remedy is legally supportable before the agency changes or preserves the contract.
Contractor must substantiate the claim
The contracting officer must ask the contractor to support the alleged mistake with written statements and evidence such as bid copies, worksheets, supplier quotations, published price lists, and other proof showing how the mistake occurred and what bid was intended.
Detailed case file is mandatory
The file must include the contractor’s evidence, the contracting officer’s signed statement, the bid, the IFB and relevant specs or drawings, the bid abstract, the contractor’s request for relief, related correspondence, and the contract and any modifications. The agency must also record the facts, determination, and action taken.
Responsibilities
Contracting Officer
Request the contractor’s supporting evidence, evaluate whether a bona fide mistake occurred, determine whether there was constructive notice before award, prepare the required signed statement, coordinate the proposed determination with legal counsel, and ensure the contract file is complete and accurate.
Contractor
Promptly support the alleged post-award mistake with written statements and documentary evidence, including bid worksheets, file copies, quotations, and other records showing the nature of the mistake, how it occurred, and the bid actually intended. If seeking relief, the contractor should clearly request reformation or rescission as appropriate.
Agency
Make and document authorized determinations to rescind, reform, or leave the contract unchanged; ensure legal review occurs; and maintain a record in the contract file of the facts, determination, and action taken in each case.
Legal Counsel
Review proposed determinations in accordance with agency procedures and advise whether the evidence and proposed remedy support rescission, reformation, correction, or no change.
Practical Implications
Post-award mistake claims are hard to win, so contractors need strong contemporaneous records; worksheets, quotes, and bid drafts often make or break the case.
The contracting officer must look for constructive notice before award, especially when a bid is far out of line or otherwise suspicious; failure to do so can support reformation or rescission.
Relief is limited to remedies that preserve sealed-bid integrity; the Government will not simply renegotiate because the contractor regrets its bid.
If the corrected price would exceed the next lowest acceptable bid, price reformation is not available under this section, which can push the case toward rescission or no relief.
Incomplete files are a common problem; both contractors and contracting officers should expect the case to be documented as if it may later be reviewed by counsel, auditors, or a board/court.
Official Regulatory Text
If a contractor’s discovery and request for correction of a mistake in bid is not made until after the award, it shall be processed under the procedures of subpart 33.2 and the following: (a) When a mistake in a contractor’s bid is not discovered until after award, the mistake may be corrected by contract modification if correcting the mistake would be favorable to the Government without changing the essential requirements of the specifications. (b) In addition to the cases contemplated in paragraph (a) of this section or as otherwise authorized by law, agencies are authorized to make a determination- (1) To rescind a contract; (2) To reform a contract- (i) To delete the items involved in the mistake; or (ii) To increase the price if the contract price, as corrected, does not exceed that of the next lowest acceptable bid under the original invitation for bids; or (3) That no change shall be made in the contract as awarded, if the evidence does not warrant a determination under subparagraph (b)(1) or (2) of this section. (c) Determinations under paragraph (b)(1) and (2) of this section may be made only on the basis of clear and convincing evidence that a mistake in bid was made. In addition, it must be clear that the mistake was- (1) Mutual; or (2) If unilaterally made by the contractor, so apparent as to have charged the contracting officer with notice of the probability of the mistake. (d) Each proposed determination shall be coordinated with legal counsel in accordance with agency procedures. (e) Mistakes alleged or disclosed after award shall be processed as follows: (1) The contracting officer shall request the contractor to support the alleged mistake by submission of written statements and pertinent evidence, such as- (i) The contractor’s file copy of the bid, (ii) The contractor’s original worksheets and other data used in preparing the bid, (iii) Subcontractors’ and suppliers’ quotations, if any, (iv) Published price lists, and (v) Any other evidence that will serve to establish the mistake, the manner in which the mistake occurred, and the bid actually intended. (2) The case file concerning an alleged mistake shall contain the following: (i) All evidence furnished by the contractor in support of the alleged mistake. (ii) A signed statement by the contracting officer- (A) Describing the supplies or services involved; (B) Specifying how and when the mistake was alleged or disclosed; (C) Summarizing the evidence submitted by the contractor and any additional evidence considered pertinent; (D) Quoting, in cases where only one bid was received, the most recent contract price for the supplies or services involved, or in the absence of a recent comparable contract, the contracting officer’s estimate of a fair price for the supplies or services and the basis for the estimate; (E) Setting forth the contracting officer’s opinion whether a bona fide mistake was made and whether the contracting officer was, or should have been, on constructive notice of the mistake before the award, together with the reasons for, or data in support of, such opinion; (F) Setting forth the course of action with respect to the alleged mistake that the contracting officer considers proper on the basis of the evidence, and if other than a change in contract price is recommended, the manner by which the supplies or services will otherwise be acquired; and (G) Disclosing the status of performance and payments under the contract, including contemplated performance and payments. (iii) A signed copy of the bid involved. (iv) A copy of the invitation for bids and any specifications or drawings relevant to the alleged mistake. (v) An abstract of written record of the bids received. (vi) A written request by the contractor to reform or rescind the contract, and copies of all other relevant correspondence between the contracting officer and the contractor concerning the alleged mistake. (vii) A copy of the contract and any related change orders or supplemental agreements. (f) Each agency shall include in the contract file a record of- (1) All determinations made in accordance with this 14.407-4 ; (2) The facts involved; and (3) The action taken in each case.