B-198395.OM, DEC 30, 1980

B-198395.OM, DEC 30, 1980

SUBJECT: CLAIM OF BESELER INTERNATIONAL CORP. - B-198395

ASSOCIATE DIRECTOR, AFMD-CLAIMS GROUP:

ATTACHED IS FILE NO. Z-1219294(9), CONCERNING THE CLAIM OF BESELER INTERNATIONAL CORP. FOR REIMBURSEMENT BY THE ARMY OF DM 30,683.11 FOR REPAIRS TO TRAINING AIDS (CUE/SEE PROJECTORS) REPAIRED IN EUROPE DURING 1975 AND 1976. BY INDORSEMENT DATED JULY 21, 1980, WE DENIED BESELER'S CLAIM; HOWEVER, WE NOTED THAT BESELER MIGHT PURSUE CLAIMS ARISING UNDER THE REPAIR WORK ON BEHALF OF ITS BUSINESS ASSOCIATES.

BY LETTER DATED OCTOBER 16, 1980, BESELER REQUESTED OUR REVIEW OF PROPOSED POWER OF ATTORNEY FORMS AUTHORIZING BESELER TO ACT ON BEHALF OF ITS ASSOCIATES - LARA AND PHORA. THIS LETTER WAS INFORMALLY SUBMITTED TO US FOR OUR REVIEW BY THE CLAIMS GROUP. IN REVIEWING THIS REQUEST, WE HAVE REEXAMINED THE ENTIRE CLAIMS FILE. BASED ON OUR REVIEW, WE REMAIN OF THE VIEW THAT BESELER'S CLAIM SHOULD BE DENIED; WE ALSO CONCLUDE THAT ANY CLAIMS WHICH THE ASSOCIATES MAY HAVE SHOULD BE DENIED. THEREFORE, IT IS UNNECESSARY TO REVIEW THE FORMS.

AS NOTED IN OUR JULY 21, 1980, INDORSEMENT, BESELER'S CLAIM AND ANY CLAIMS THAT ITS ASSOCIATES MAY HAVE RELATE TO REPAIRS TO TRAINING AIDS WHICH BESELER CONTENDS WERE MADE AFTER THE TRAINING AIDS WERE "OUT-OF WARRANTY" UNDER PURCHASE ORDERS ISSUED BY THE DEPARTMENT OF THE ARMY. THE EXTENT LARA MAY HAVE HAD A CLAIM FOR REPAIR WORK - AS SUGGESTED BY ONE OF THE PROPOSED POWER OF ATTORNEY FORMS SUBMITTED FOR OUR REVIEW - WE NOTE THERE IS A LETTER IN THE FILE FROM BESELER DATED MARCH 20, 1979, WHICH STATES THAT THE "LARA COMPANY IS NO LONGER IN EXISTENCE."

EVEN IF WE ASSUME FOR THE PURPOSE OF DISCUSSION THAT ANY CLAIM LARA MIGHT HAVE HAD IS STILL LEGALLY COGNIZABLE, IT IS OUR VIEW THAT THIS CLAIM AND ANY CLAIM PHORA MIGHT NOW HAVE SHOULD BE DENIED. WE BASE OUR DENIAL ON COMMENTS SET FORTH IN A SEPTEMBER 5, 1979, ARMY LEGAL MEMO CONTAINED IN THE FILE.

THE LEGAL MEMO NOTES THAT THERE IS INSUFFICIENT EVIDENCE TO DETERMINE WHETHER THE REPAIR SERVICES WERE, IN FACT, "OUT-OF-WARRANTY," OR WHETHER THE SERVICES SHOULD HAVE BEEN NO-COST WARRANTY REPAIRS. THE MEMO DIRECTLY QUESTIONS THE SUFFICIENCY OF A "CORROBORATIVE STATEMENT" PREPARED BY AN ARMY LIEUTENANT IN SUPPORT OF THE CLAIMS. ON THIS SCORE, THE MEMO NOTES THAT THE "CORROBATIVE STATEMENT" DOES NOT CONTAIN ANY ANALYSIS SHOWING THAT "EACH INVOICE ENTRY SET FORTH ON PHORA'S INVOICES TO LARA REPRESENTS AN 'OUT-OF-WARRANTY' REPAIR SERVICE" AS DISTINGUISHED FROM A NO-COST WARRANTY REPAIR. FINALLY, THE MEMO NOTES THAT THERE IS A LACK OF "DOCUMENTATION ESTABLISHING THAT THE PRICE INVOLVED FOR EACH REPAIR SERVICE WAS FAIR AND REASONABLE."

WE AGREE WITH THE CONCLUSIONS SET FORTH IN THE MEMO. CONSEQUENTLY, WE CONCLUDE THAT ANY CLAIMS BESELER'S ASSOCIATES MAY HAVE ARE DOUBTFUL; IN THESE CIRCUMSTANCES, IT IS OUR ESTABLISHED POLICY TO DISALLOW THE DOUBTFUL CLAIMS AND LEAVE THE CLAIMANTS TO PURSUE WHATEVER REMEDY THAT MAY BE AVAILABLE IN THE COURTS. SEE REITER-COMPTON TRUCKS, B-184942, SEPTEMBER 11, 1976, 76-2 CPD 210.

CONSEQUENTLY, WE ARE UNABLE TO AUTHORIZE PAYMENT OF ANY CLAIMS THAT MAY BE ADVANCED BY BESELER'S ASSOCIATES.