B-147608, JUN. 4, 1962
Highlights
YOU WERE DECLARED TO BE IN DEFAULT OF YOUR CONTRACT. DELIVERY WAS NOT MADE AS REQUIRED AND THE ITEMS WERE REPURCHASED LOCALLY FROM J. EXCESS COST IN THE AMOUNT OF $288.71 WAS CHARGED AGAINST YOUR ACCOUNT. IT WAS REPORTED BY THE GENERAL SERVICES ADMINISTRATION THAT THE DEFAULTED CONTRACT WAS BASED ON A CORRELATED GROUP OF SOFT WOOD (KNOTTY PINE) AND THAT THERE IS NO OTHER KNOWN SOURCE OF A CORRELATED GROUP OF FURNITURE MADE OF KNOTTY PINE. THE GOVERNMENT WAS REQUIRED TO RESORT TO OAK OR WHITE PINE IN THE REPURCHASE. THAT THE PROPER MEASURE OF DAMAGES CHARGEABLE AGAINST YOUR FIRM WAS THE ADDITIONAL COST INCURRED BY THE GOVERNMENT IN PROCURING THE SUBSTITUTE ITEMS. IN YOUR REQUEST FOR RECONSIDERATION YOU STATE THAT FURNITURE SIMILAR TO THE FURNITURE REQUIRED UNDER YOUR CONTRACT WAS AVAILABLE WITHOUT INCURRING EXCESS EXPENSES.
B-147608, JUN. 4, 1962
TO HABITANT SHOPS, INC.:
THIS REFERS TO YOUR LETTER OF FEBRUARY 20, 1962, REQUESTING RECONSIDERATION OF OUR DECISION OF FEBRUARY 7, 1962, B-147608, WHICH SUSTAINED THE DEFAULT ACTION TAKEN AGAINST YOUR FIRM UNDER FEDERAL SUPPLY CONTRACT NO. GS-OOS-33439.
ON NOVEMBER 22, 1960, YOU RECEIVED AWARD ON FEDERAL SUPPLY SCHEDULE CONTRACT NO. GS-OOS-33439, FOR THE SUPPLYING OF CERTAIN FURNITURE FOR THE GOVERNMENT, AS ORDERED DURING THE PERIOD FEBRUARY 1, 1961, THROUGH JANUARY 31, 1962. DURING JUNE 1961 YOU REQUESTED TO BE RELIEVED FROM ALL OBLIGATIONS UNDER THE CONTRACT AS YOU HAD DECIDED TO CEASE ALL FURNITURE PRODUCTION BECAUSE OF LABOR AND FINANCIAL PROBLEMS. THEREAFTER, YOU WERE DECLARED TO BE IN DEFAULT OF YOUR CONTRACT.
THE VETERANS ADMINISTRATION HOSPITAL, DEARBORN, MICHIGAN, HAD ORDERED 11 PIECES OF FURNITURE FROM YOU ON APRIL 3, 1961, UNDER THE SUBJECT CONTRACT, FOR DELIVERY BY JUNE 15, 1961, AT A TOTAL PRICE OF $826.19, INCLUDING DISCOUNT. DELIVERY WAS NOT MADE AS REQUIRED AND THE ITEMS WERE REPURCHASED LOCALLY FROM J. L. HUDSON COMPANY, AT A TOTAL COST OF $1,054.90. EXCESS COST IN THE AMOUNT OF $288.71 WAS CHARGED AGAINST YOUR ACCOUNT.
IT WAS REPORTED BY THE GENERAL SERVICES ADMINISTRATION THAT THE DEFAULTED CONTRACT WAS BASED ON A CORRELATED GROUP OF SOFT WOOD (KNOTTY PINE) AND THAT THERE IS NO OTHER KNOWN SOURCE OF A CORRELATED GROUP OF FURNITURE MADE OF KNOTTY PINE. ACCORDINGLY, THE GOVERNMENT WAS REQUIRED TO RESORT TO OAK OR WHITE PINE IN THE REPURCHASE. BASED ON APPLICABLE PRINCIPLES OF LAW, WE CONCLUDED IN OUR DECISION OF FEBRUARY 7, 1962, THAT THE PROPER MEASURE OF DAMAGES CHARGEABLE AGAINST YOUR FIRM WAS THE ADDITIONAL COST INCURRED BY THE GOVERNMENT IN PROCURING THE SUBSTITUTE ITEMS, NAMELY $228.71.
IN YOUR REQUEST FOR RECONSIDERATION YOU STATE THAT FURNITURE SIMILAR TO THE FURNITURE REQUIRED UNDER YOUR CONTRACT WAS AVAILABLE WITHOUT INCURRING EXCESS EXPENSES, FROM THE A. BRANDT COMPANY, INC., OF FORT WORTH, TEXAS, A SCHEDULE SUPPLIER TO THE GENERAL SERVICES ADMINISTRATION AT THE TIME. YOU CONTEND THAT THE VETERANS ADMINISTRATION WAS NOT JUSTIFIED IN REPURCHASING ITS REQUIREMENTS LOCALLY WHEN THE A. BRANDT SOURCE WAS AVAILABLE AT LOWER PRICES. IN SUPPORT OF THIS CONTENTION YOU SUBMIT A LIST OF THE ITEMS ORDERED UNDER YOUR CONTRACT BY THE VETERANS ADMINISTRATION, AND A COMPARATIVE LISTING OF SIMILAR ITEMS AND PRICES WHICH COULD HAVE BEEN OBTAINED FROM BRANDT.
THE VETERANS ADMINISTRATION REPORTS BY LETTER OF MAY 18, 1962, THAT, PRIOR TO THE REPURCHASE, IT HAD COMPARED THE A. BRANDT ITEMS WITH THOSE REQUIRED FROM HABITANT AND IT CONCLUDED THAT THE ITEMS OF A. BRANDT WERE NOT COMPARABLE TO THOSE SUPPLIED BY HABITANT. WHILE SOME OF THE ITEMS MAY HAVE BEEN COMPARABLE, THE GREATER MAJORITY OF THE ITEMS ARE REPORTED NOT COMPARABLE EITHER FROM A PRICE, SIZE OR CONSTRUCTION STANDPOINT. ANALYSIS OF EACH OF THE ITEMS OFFERED BY HABITANT, HUDSON AND BRANDT IS PRESENTED. IT IS NOTED FROM THE ANALYSIS THAT, AS TO THE FIRST FOUR REQUIRED ITEMS, WHILE NEITHER HUDSON OR BRANDT OFFERED THE WIDTH OR SEAT SIZE OF THE HABITANT ITEMS, HUDSON IS CLOSER TO THE HABITANT SIZE THAN BRANDT. ALSO, ON THE SEVENTH ITEM, WHICH CALLS FOR A TABLE, OCCASIONAL, END, WITH SHELF, WIDTH 23 INCHES, LENGTH 27 INCHES, HEIGHT 22 INCHES, BRANDT OFFERS A TABLE, OCCASIONAL, LAMP, WITH SQUARE TOP, 28 BY 28 INCHES AND A HEIGHT OF 25 INCHES. THE VETERANS ADMINISTRATION STATES THAT A SQUARE TABLE FOR USE AS A LAMP TABLE IS NOT COMPARABLE TO A STEP-TYPE TABLE AND A TABLE WITH A SHELF.
AGAIN, ON ITEM 8, THE CONTRACT WITH HABITANT CALLED FOR A TABLE, STEP, WIDTH 20 INCHES, LENGTH 27 INCHES, HEIGHT 25 INCHES. THE BRANDT ITEM IS A TABLE, OCCASIONAL, STEP, WITH A WIDTH OF 17 1/2 INCHES, LENGTH 32 INCHES, AND HEIGHT 14 INCHES. THIS ITEM IS NOT CONSIDERED COMPARABLE TO THE HABITANT ITEM NOR TO THE ITEM PROCURED FROM HUDSON.
FROM THE FACTS PRESENTED WE MUST CONCLUDE THAT THE BRANDT ITEMS YOU SPECIFY ARE NOT SATISFACTORY SUBSTITUTES FOR THE ITEMS SUPPLIED BY HABITANT, AND THAT THE VETERANS ADMINISTRATION DID PURCHASE THE BEST AVAILABLE SUBSTITUTES. ACCORDINGLY, WE FIND THAT YOU ARE LIABLE TO THE UNITED STATES FOR THE EXCESS COST OF $2228.71. PAYMENT OF THIS AMOUNT MUST BE MADE WITHIN 20 DAYS FROM THE DATE OF THIS LETTER. IN THE EVENT OF YOUR REFUSAL TO MAKE PAYMENT OF THIS AMOUNT WITHIN SUCH TIME, ACTION WILL BE TAKEN TO REFER THE MATTER OF YOUR INDEBTEDNESS TO THE DEPARTMENT OF JUSTICE FOR COLLECTION ACTION.