PUBLIC CONTRACTS.

Auckland Star, Volume XLIV, Issue 57, 7 March 1913, Page 5

PUBLIC CONTRACTS.

AND LOW TENDERS. : T_ ' Si.

SHOULD THERE BE A LIMIT T

|The lowest or any tender not necessarily accepted " is generally the way the advertisement runs, but in these days of keen competition one very seldom hears of the man at the bottom of the list having his offer rejected. The. question as to how far a public body is justified in accepting a tender that' is on the face of it exceptionally low cropped up at a meeting of creditors this morning in the bankrupt estate of an Austrian named George Christoff. For a section of the Argyle Street tunnel in connection with the Auckland drainage scheme, the estimate of the Drainage Board's engineer was £1,600. Christoff's tender to do the job for the sum of £1,185. was accepted. The next on the list asked £2,138 for the work. After a certain amount of tunnelling had been done, part of the street caved in, and generally the Board was not satisfied with the way the work was being carried v out, and cancelled the contract. The Board is now completing the work with its own men. When the contract was cancelled there was in the Board's hands a sum of £185 (the usual percentage retained to meet liens) and also the £50 deposit put up by Christoff. Exercising the strictest economy, and using the best methods, the Board finds that it cannot do the work under 21/ per foot. Christoff's tender was something like 15/ a foot. When Christoff started the work he had a capital of £27, of which £25 went towards the deposit, the other half being found by his mates who "stood in " on the job with him. He has now gone bankrupt, and his unsecured -creditors are £194 short. Mr. R. H. Irwin, the secretary to the Board, produced the papers dealing with the contract, and explained the strong reasons which compelled the Board to take the work off the hands of the contractor. He said the Board was doing the work as expeditiously and as economically as possible. It would cost about £100 to put ATgyle Street in order, and for this work the contractor was liable. When the contract was completed there would be no money to •the credit of Christoff. On the other hand, he was certain there would be a deficit. It was stated during the meeting that before the contract was taken over by the Board one creditor who had a lien got a judgment summons against Christoff, and the amount of- this claim had been satisfied by the Board. , The Official Assignee (Mr. W. S. Fisher) said Christoff should have informed his other creditors of the fact that the contract had been taken over by the Board. Had that been done they could have protected themselves to the extent of the £185 percentage retained by the Board. These steps should have been taken within a month, so that the time had now gone by. One of the creditors contended that the Board should never have accepted Christoff's tender when it was so much below the estimate of the Board's engineer. Mr. Irwin pointed out that the Board was a public body, and if it did not accept the lowest tender there would, soon be an outcry from the ratepayers, and the Press* would be" inundated with letters of protest. Mr. Bryant, another creditor, said that in the ordinary course of tendering, vvhenever-an obvious mistake was made the tender would not be accepted until the matter had been brought under the notice of the tenderer by the engineer. Mr. Irwin said there was. not the slightest suggestion of a mistake about Christoff's tender. Both tender arid schedule were in perfect order, or the engineer would never have advised that the contract be entered into. A Creditor: The best thing the Board can do now is to pay us all! "What will the Board do for us?" asked another tradesman who had been left lamenting. Mr. Irwin said the question was hardly a fair one -to put to him. The Board was a public body dealing with public money, and was responsible to the ratepayers. - However, he would put the matter before the chairman ot the Board without delay, and communicate the result of his inquiries to the Official Assignee. The bankrupt was examined as to his' assets, but beyond the amounts held by the. Board and his plant, he had nothing to offer. He said lie had a lease of certain land at Avondale, " that would hot grow anything," and he was at present engaged fishing on shares with another man. " I'm afraid it means that you'll get nothing from the estate, gentlemen," said the Official Asignee, and the creditors dispersed, empty as to their pockets but full as to their Uope3 in the good nature of the Drainage Board.