A-11780, JANUARY 18, 1926, 5 COMP. GEN. 491

A-11780: Jan 18, 1926

Additional Materials:

Contact:

Edda Emmanuelli Perez
(202) 512-2853
EmmanuelliPerezE@gao.gov

 

Office of Public Affairs
(202) 512-4800
youngc1@gao.gov

OXYGEN - NONRETURN OF EMPTY CONTAINERS WHERE A GOVERNMENT PURCHASE ORDER FOR OXYGEN CONTAINED NO PROVISION AS TO THE VALUE OF THE CONTAINERS (CYLINDERS) IN WHICH THE OXYGEN WAS TO BE SHIPPED. IT IS AGREED THAT THE VALUE OF EACH CYLINDER IS AS FOLLOWS: * * *" DOES NOT BIND THE GOVERNMENT TO PAY SUCH VALUES IN CASE OF THE NONRETURN OF THE CYLINDERS. UPON A CLAIM FOR THE VALUE OF FOUR CYLINDERS NOT RETURNED WHERE THE OFFICIAL RECORDS DISCLOSE THAT THE SAID CYLINDERS COULD NOT BE LOCATED SOME TIME AFTER DELIVERY TO THE GOVERNMENT AND THERE IS NO SHOWING OF THEIR EVER HAVING BEEN RETURNED TO THE VENDOR. WAS ISSUED TO THE COMPANY FOR SHIPMENT WITHIN FIVE DAYS TO DEPOT QUARTERMASTER. FOR ALL CYLINDERS NOT RETURNED WITHIN 30 DAYS FROM DATE OF SHIPMENT A RENT CHARGE OF 25 CENTS PER CYLINDER WILL BE PAYABLE FOR ALL TIME OVER THIRTY DAYS EACH CYLINDER IS AWAY FROM CONTRACTOR DISTRIBUTING STATION.

A-11780, JANUARY 18, 1926, 5 COMP. GEN. 491

PURCHASES, OXYGEN - NONRETURN OF EMPTY CONTAINERS WHERE A GOVERNMENT PURCHASE ORDER FOR OXYGEN CONTAINED NO PROVISION AS TO THE VALUE OF THE CONTAINERS (CYLINDERS) IN WHICH THE OXYGEN WAS TO BE SHIPPED, OR FOR PAYMENT THEREFOR IN ANY AMOUNT IN CASE OF THEIR NONRETURN TO THE VENDOR, A NOTATION ON THE VENDOR'S PRINTED INVOICE THAT "BY THE ACCEPTANCE OF THIS INVOICE, IT IS AGREED THAT THE VALUE OF EACH CYLINDER IS AS FOLLOWS: * * *" DOES NOT BIND THE GOVERNMENT TO PAY SUCH VALUES IN CASE OF THE NONRETURN OF THE CYLINDERS. PAYMENT AT A REASONABLE VALUATION MAY BE ALLOWED, HOWEVER, UPON A CLAIM FOR THE VALUE OF FOUR CYLINDERS NOT RETURNED WHERE THE OFFICIAL RECORDS DISCLOSE THAT THE SAID CYLINDERS COULD NOT BE LOCATED SOME TIME AFTER DELIVERY TO THE GOVERNMENT AND THERE IS NO SHOWING OF THEIR EVER HAVING BEEN RETURNED TO THE VENDOR.

DECISION BY COMPTROLLER GENERAL MCCARL, JANUARY 18, 1926:

THE LINDE AIR PRODUCTS CO., BY LETTER DATED OCTOBER 22, 1925, APPLIED FOR REVIEW OF SETTLEMENT NO. 014633, DATED OCTOBER 2, 1925, DISALLOWING ITS CLAIM FOR $140, THE ALLEGED VALUE OF OXYGEN CYLINDERS NOS. K-314455, K- 122369, K-122806, AND K-209676 DELIVERED TO THE UNITED STATES GOVERNMENT AT ATLANTA, GA., IN SEPTEMBER AND OCTOBER, 1920, AND NOT RETURNED.

PURCHASE ORDER NO. 5-GS-21-949, DATED OCTOBER 28, 1920, WAS ISSUED TO THE COMPANY FOR SHIPMENT WITHIN FIVE DAYS TO DEPOT QUARTERMASTER, UNITED STATES ARMY, GENERAL SUPPLY DEPOT, WAREHOUSE D-17, ATLANTA, GA., F.O.B. COMPANY'S PLANT, ATLANTA, GA., OF "6,820 CUBIC FEET OF OXYGEN (31 TANKS) 220 CUBIC FEET TO TANK.' THE ORDER CONTAINED A PROVISION AS FOLLOWS:

CYLINDERS TO BE RETURNED TO SUPPLIER WHEN EMPTY, AND FOR ALL CYLINDERS NOT RETURNED WITHIN 30 DAYS FROM DATE OF SHIPMENT A RENT CHARGE OF 25 CENTS PER CYLINDER WILL BE PAYABLE FOR ALL TIME OVER THIRTY DAYS EACH CYLINDER IS AWAY FROM CONTRACTOR DISTRIBUTING STATION.

THE QUARTERMASTER'S RECEIVING REPORT SHOWS THAT THE 31 CYLINDERS, SETTING OUT THEIR SERIAL NUMBERS, INCLUDING CYLINDERS 314455 AND 122369, WERE RECEIVED BY TRUCK NOVEMBER 1, 1920.

CYLINDERS K-122806 AND K-209676 WERE ALLEGED BY CLAIMANT TO HAVE BEEN FURNISHED ON MEDICAL ORDER PO-802 AND TO HAVE BEEN CALLED FOR BY UNITED STATES ARMY TRUCK FOR THE LAWSON GENERAL HOSPITAL, ATLANTA, GA., ON SEPTEMBER 24, 1920. NO COPY OF SAID ORDER WAS SUBMITTED BY THE CLAIMANT NOR WAS ANY FOUND WITH THE PAPERS IN THE CASE.

A DULY APPOINTED BOARD OF OFFICERS INVESTIGATED JULY 31, 1924, THE CLAIM FOR THE RETURN OF OR PAYMENT FOR THE FOUR OXYGEN CYLINDERS IN QUESTION. THE BOARD FOUND, IN SUBSTANCE, THAT DELIVERY OF THE FOUR CYLINDERS HAD BEEN MADE AS ALLEGED BY CLAIMANT AND THAT DUE SEARCH OF ALL PERTINENT RECORDS AND OTHER INQUIRY FAILED TO DISCLOSE ANY EVIDENCE INDICATING RETURN TO THE CLAIMANT OR PAYMENT THEREFOR, AND RECOMMENDED PAYMENT IN THE AMOUNT OF $140, BEING AT THE RATE OF $35 PER CYLINDER.

IN DISALLOWING THE CLAIM IT WAS STATED THAT THE EVIDENCE FAILED TO PROVE THAT CYLINDERS K-122806 AND K-209676 WERE DELIVERED TO THE GOVERNMENT AND THE RECORDS OF THE WAR DEPARTMENT FAILED TO SHOW RECEIPT OF THE SAME.

CLAIMANT HAS SINCE FURNISHED A CERTIFIED COPY OF ORDER NO. 802 MED., WHICH IS DATED SEPTEMBER 24, 1920; ALSO COPY OF ITS BILL OF LADING OF SAME DATE, NO. 46915, SHOWING DELIVERY OF THE OXYGEN TO GOVERNMENT TRUCK IN CYLINDERS K-122806 AND K-209676, SIGNED "HENRY B. RIEPERTS.' CLAIMANT STATES ALSO THAT PAYMENT FOR THE OXYGEN CONTAINED IN THESE CYLINDERS WAS MADE BY CHECK NO. 36138, DATED OCTOBER 31, 1920, VOUCHER NO. 3167, SIGNED BY CHARLES E. DOBBINS, CAPTAIN, FINANCE DEPARTMENT, UNITED STATES ARMY, NO. 26498. REFERENCE TO SAID VOUCHER VERIFIES THE STATEMENT, AND SHOWS COPY OF PURCHASE ORDER NO. 802 MED., ATTACHED CALLING FOR "1 TANK 440 OXYGEN (CONTENTS NLY)" FOR IMMEDIATE DELIVERY, SHIPMENT TO LAWSON GENERAL HOSPITAL, ATLANTA, GA. INSTEAD OF IN ONE TANK, SHIPMENT OF THE 440 CUBIC FEET OF OXYGEN APPEARS TO HAVE BEEN MADE IN TWO CYLINDERS, EACH OF 220 CUBIC FEET CAPACITY. CLAIMANT'S INVOICE ATTACHED TO THE VOUCHER IS FOR "440 CUBIC FEET OXYGEN IN OUR CYLINDERS AS PER SHIPPING LIST ATTACHED. CYLINDERS ARE LOANED TO YOU IN ACCORDANCE WITH TERMS STATED ON BACK HEREOF.' NO SHIPPING LIST IS ATTACHED. THE TERMS REFERRED TO READ:

BY THE ACCEPTANCE OF THIS INVOICE, IT IS AGREED THAT THE VALUE OF EACH CYLINDER IS AS FOLLOWS: 110 CUBIC FEET CAPACITY, $22.50; 220 CUBIC FEET CAPACITY, $35.00; 275 CUBIC FEET CAPACITY, $47.50. FREE ALLOWANCE PERIOD SHALL COMMENCE ON THE DATE OF SHIPMENT OF OXYGEN. RENTAL SHALL ACCRUE FROM EXPIRATION OF FREE ALLOWANCE PERIOD UNTIL RECEIPT OF RETURNED CYLINDERS BY THE LINDE AIR PRODUCTS CO., AT ITS SAID DISTRIBUTING STATION, ALL EXPENSES PREPAID.

THE INVOICE INDICATED ALSO: "SHIPPED FROM ATLANTA, B/L. 46915, * * * YOUR TRUCK.'

THE TERMS ABOVE QUOTED WITH REFERENCE TO THE VALUE OF CYLINDERS ARE NOT BINDING UPON THE GOVERNMENT, SINCE THE PURCHASE ORDER FOR THE OXYGEN MAKES NO PROVISION FOR PAYMENT IN ANY AMOUNT FOR CYLINDERS NOT RETURNED; NOR IS ANY PROVISION MADE THEREIN WITH REFERENCE TO RENTAL. IT MAY BE SAID ALSO THAT THE PROVISION QUOTED, SUPRA, FROM PURCHASE ORDER OF OCTOBER 28, 1920, IS NOT ENFORCEABLE AGAINST THE GOVERNMENT BECAUSE IT IS INDEFINITE AS TO THE TIME FOR WHICH IT MIGHT RUN.

IT HAS BEEN HELD THAT FOR OXYGEN CYLINDERS RETAINED FOR THE BENEFIT OF THE GOVERNMENT BEYOND A REASONABLE PERIOD FOR THEIR RETURN, A REASONABLE RENTAL THEREFORE BASED ON THE ESTIMATED DEPRECIATION DURING THE TIME SO RETAINED BY THE GOVERNMENT IS AUTHORIZED, ALTHOUGH THE CONTRACT FOR THE GAS FURNISHED THEREIN CONTAINED NO PROVISION FOR RENTAL OF CYLINDERS. 3582, FEBRUARY 26, 1925.

NO CLAIM, HOWEVER, IS MADE FOR RENTAL OF THE FOUR CYLINDERS IN QUESTION, NOR DOES IT AFFIRMATIVELY APPEAR THAT THE GOVERNMENT DERIVED ANY BENEFIT FROM THEIR RETENTION BEYOND A REASONABLE PERIOD FROM THE TIME OF THEIR DELIVERY BY THE CLAIMANT.

IT DOES APPEAR THAT A LARGE NUMBER OF OXYGEN CYLINDERS WERE SOLD BY THE GOVERNMENT AT PUBLIC AUCTION AT ATLANTA, GA., IN MAY, 1922, AT ABOUT $10 EACH, BUT IT HAS NOT BEEN ESTABLISHED THAT THE FOUR CYLINDERS IN QUESTION WERE AMONG THOSE SO SOLD.

WHILE THE EVIDENCE SHOWS NEGLIGENCE OR CARELESSNESS ON THE PART OF THE GOVERNMENT OFFICERS CONCERNED IN NOT RETURNING THE CYLINDERS TO CLAIMANT AFTER THE CONTENTS HAD BEEN USED, AS WELL ALSO ON THE PART OF THE CLAIMANT IN NOT TAKING UP WITH SUCH OFFICERS THE MATTER OF THE RETURN OF THE CYLINDERS UNTIL AFTER A YEAR OR MORE FROM THE TIME OF THEIR DELIVERY TO THE GOVERNMENT, IT WOULD APPEAR, FROM THE PRESENT SHOWING OF THE RECORD, THAT THE GOVERNMENT MAY PROPERLY PAY THE CLAIMANT THE REASONABLE VALUE OF THE FOUR CYLINDERS WHICH THE GOVERNMENT OFFICERS CONCERNED ARE NOT ABLE TO LOCATE AND WHICH HAVE NOT BEEN RETURNED TO CLAIMANT.

ALTHOUGH REQUESTED TO FURNISH EVIDENCE SHOWING THE MARKET VALUE OF THE CYLINDERS, CLAIMANT HAS SUBMITTED NOTHING FURTHER THAN THE NOTATION ON ITS PRINTED INVOICE THAT THE VALUE OF CYLINDERS OF 220 CUBIC FEET CAPACITY IS $35 EACH. THE AMERICAN OXYGEN SERVICE CO. HAS STATED THAT TO IT SUCH CYLINDERS REPRESENT AN INVESTMENT OF "MORE THAN $25 EACH.' A-11241, NOVEMBER 21, 1925. A VALUATION OF LIKE CYLINDERS HAS BEEN PLACED BY THIS OFFICE AT $16 EACH, BASED UPON THE REPORT OF THE COMMANDING OFFICER, EDGEWOOD ARSENAL, A-3582, FEBRUARY 26, 1925.

UPON REVIEW $64 IS CERTIFIED DUE CLAIMANT AS IN FULL SATISFACTION OF ITS CLAIM FOR THE VALUE OF THE FOUR CYLINDERS NOT RETURNED TO IT BY THE GOVERNMENT.