B-141226, APR. 29, 1960

B-141226, APR. 29, 1960

TO WACHTEL, WIENER AND ROSS:

WE REFER AGAIN TO YOUR LETTER OF MARCH 9, 1960, PROTESTING AGAINST THE TENDERING OF THE EX U.S.S. AUGUSTA, BY THE DEPARTMENT OF THE NAVY TO THE UNION MINERALS AND ALLOYS CORPORATION, AND REQUESTING OUR CONSIDERATION AND INTERVENTION.

IN OUR DECISION, B-141226, DECEMBER 31, 1959, WE CONSIDERED THE CIRCUMSTANCES SURROUNDING THE BIDS RECEIVED UNDER INVITATION B-88-60 131, ISSUED OCTOBER 7, 1959, WHICH OFFERED THE CRUISER AUGUSTA FOR SALE ON AN "AS IS WHERE IS" BASIS. IN THAT DECISION WE ADVISED THE SECRETARY OF THE NAVY THAT WE WOULD INTERPOSE NO OBJECTION TO DELIVERY OF THE VESSEL TO ROBERT BENJAMIN, YOUR CLIENT, WHO HAD SUBMITTED THE HIGHEST BID BUT WHO DID NOT SUBMIT A BID DEPOSIT IN THE FORM REQUIRED UNDER THE APPLICABLE STATUTE.

WE HAVE BY LETTER OF APRIL 6, 1960, FROM THE DEPARTMENT OF THE NAVY, RECEIVED AN ADDITIONAL STATEMENT OF FACTS ON THE MATTER WHICH READS IN PART AS FOLLOWS:

"ON NOVEMBER 9, 1959 MR. BENJAMIN WROTE TO UNION MINERALS AND ALLOYS CORP. TO CONFIRM AN ORAL AGREEMENT WHEREBY BENJAMIN SOLD TO UNION ALL OF HIS "RIGHT, TITLE AND INTEREST" IN THE ANTICIPATED GOVERNMENT CONTRACT AND IN THE VESSEL. UNION AGREED TO FURNISH THE REQUIRED BID BOND AND TO ACCEPT THE TERMS AND CONDITIONS OF THE ANTICIPATED GOVERNMENT CONTRACT.

"ON NOVEMBER 13, UNION INFORMED THE UNITED STATES CONTRACTING OFFICER OF ITS PURCHASE OF THE VESSEL FROM BENJAMIN, AND ON NOVEMBER 18 REPRESENTATIVES OF BENJAMIN AND UNION DELIVERED TO THE SUPPLY OFFICER UNION'S CERTIFIED CHECK AND PERFORMANCE BOND AND A LETTER FROM BENJAMIN IRREVOCABLY AUTHORIZING THE UNITED STATES TO DELIVER THE SHIP TO UNION. ALSO ON NOVEMBER 18, BENJAMIN SENT TWO LETTERS TO UNION CONFIRMING THAT "ALL RIGHT, TITLE AND INTEREST IN AND TO CRUISER CA-31 VESTS IN YOU AS AND WHEN YOUR PAYMENT IS MADE TO THE NAVY * * *.'

"ON NOVEMBER 13, HOWEVER, AS YOU ARE AWARE, BETHLEHEM STEEL ENTERED A PROTEST AGAINST THE AWARD TO BENJAMIN. THIS PROTEST WAS DECIDED ON DECEMBER 31, 1959. WHILE THIS PROTEST WAS PENDING THE NAVY REFUSED TO ALLOW EITHER BENJAMIN OR UNION TO REMOVE THE SHIP.

"THEREAFTER, A CONFLICT DEVELOPED BETWEEN BENJAMIN AND UNION AS TO WHICH WAS ENTITLED, UNDER THE CONTRACT, TO DELIVERY OF THE VESSEL.

"AN EFFORT WAS MADE BY THE NAVY TO RECONCILE THESE CONFLICTING CLAIMS. WITH THE CONCURRENCE OF UNION, THE NAVY INFORMED BENJAMIN THAT IT WOULD DELIVER THE VESSEL TO HIM AND RETURN THE CONDITIONAL PAYMENT IF HE WOULD MAKE AN UNCONDITIONAL TENDER OF THE PURCHASE PRICE. THIS HE FAILED TO DO.

"BENJAMIN CONTENDED THAT WHILE DELIVERY OF THE VESSEL WAS DELAYED PENDING DECISION ON BETHELEM'S PROTEST, UNION HAD RESCINDED THE ASSIGNMENT FROM BENJAMIN TO UNION, AND THAT HE--- BENJAMIN--- WAS ENTITLED TO THE VESSEL. UNION CONTENDED THAT, AT MOST, IT HAD MADE AN OFFER TO RESCIND, CONDITIONED ON THE RETURN OF THE PURCHASE MONEY IT HAD PUT UP AND UPON BENJAMIN'S ARRANGING FOR A SUBSTITUTE PERFORMANCE BOND.

"AFTER PAINSTAKING CONSIDERATION, THE NAVY CONCLUDED THAT IN THE CIRCUMSTANCES UNION WAS ENTITLED TO THE VESSEL OR TO RETURN OF ITS PURCHASE MONEY, AND THAT THE INTERESTS OF THE GOVERNMENT WOULD BEST BE SERVED BY RECOGNIZING THE ASSIGNMENT FROM BENJAMIN TO UNION. THE PARTIES WERE SO INFORMED, AND DELIVERY OF THE VESSEL WAS MADE TO UNION ON MARCH 2, 1960.'

SINCE THE VESSEL HAS ALREADY BEEN DELIVERED TO UNION, WE ARE AWARE OF NO LEGAL BASIS UPON WHICH WE COULD EFFECT ITS RETURN EVEN IF IT SHOULD BE CONCLUDED THAT YOUR CLIENT IS ENTITLED TO POSSESSION OF THE VESSEL. FAR AS ANY MONEY CLAIM ON BEHALF OF YOUR CLIENT IS CONCERNED, SUCH CLAIM WOULD HAVE TO BE SUBMITTED UNDER OUR RULES, IN A DEFINITE AMOUNT, WITH A STATEMENT OF THE FACTS AND CIRCUMSTANCES APPERTAINING BEFORE IT COULD BE CONSIDERED. IN THIS CONNECTION, AS YOU ARE NO DOUBT AWARE, OUR OFFICE GENERALLY MUST DECLINE TO CONSIDER UNLIQUIDATED CLAIMS FOR DAMAGES ARISING OUT OF BREACH OF CONTRACT. SEE 21 COMP. DEC. 134.

IN ACCORDANCE WITH THE FOREGOING, THERE IS NO ACTION WHICH OUR OFFICE MAY PROPERLY TAKE AT THIS TIME WITH RESPECT TO THE MATTER.