A-13881, A-23345, AUGUST 21, 1928, 8 COMP. GEN. 80

A-13881,A-23345: Aug 21, 1928

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FISCAL AGENTS OF THE GOVERNMENT ARE NOT REQUIRED TO DEDUCT LIQUIDATED DAMAGES FOR THE PERIOD INTERVENING BETWEEN THE EFFECTIVE DATE OF AN ORDER ISSUED IN ACCORDANCE WITH THE TERMS OF THE CONTRACT FOR THE SUSPENSION OF ACTIVITIES IN THE BUILDING OF ROADS DURING THE WINTER PERIOD AND THE EFFECTIVE DATE OF THE ORDER TO RECOMMENCE THE WORK WHEN THE CONTRACT PERIOD INCLUDES THE WINTER SEASON. TO THE EFFECT THAT IN VIEW OF SAID DECISION FISCAL AGENTS OF THE DEPARTMENT OF AGRICULTURE ARE RELUCTANT TO MAKE PROGRESS PAYMENTS TO CONTRACTORS WHERE SUCH DELAYS ARE INVOLVED. IT WAS NOT THE PURPOSE OR INTENT OF THE DECISION OF JUNE 21. TO PRECLUDE THE MAKING OF AUTHORIZED PROGRESS PAYMENTS WHERE THE DELAY WAS DUE TO THE ORDER OF THE GOVERNMENT.

A-13881, A-23345, AUGUST 21, 1928, 8 COMP. GEN. 80

CONTRACTS - LIQUIDATED DAMAGES - DELAYS DUE TO SHUT-DOWN ORDERS OF THE GOVERNMENT UNDER ARTICLE 9 OF THE STANDARD GOVERNMENT CONSTRUCTION CONTRACT, FISCAL AGENTS OF THE GOVERNMENT ARE NOT REQUIRED TO DEDUCT LIQUIDATED DAMAGES FOR THE PERIOD INTERVENING BETWEEN THE EFFECTIVE DATE OF AN ORDER ISSUED IN ACCORDANCE WITH THE TERMS OF THE CONTRACT FOR THE SUSPENSION OF ACTIVITIES IN THE BUILDING OF ROADS DURING THE WINTER PERIOD AND THE EFFECTIVE DATE OF THE ORDER TO RECOMMENCE THE WORK WHEN THE CONTRACT PERIOD INCLUDES THE WINTER SEASON.

COMPTROLLER GENERAL MCCARL TO THE SECRETARY OF AGRICULTURE, AUGUST 21, 1928:

THERE HAS BEEN RECEIVED IN REFERENCE TO DECISION DATED JUNE 21, 1928, A- 23345, OF THIS OFFICE, RELATIVE TO THE MAKING OF FINAL PAYMENTS WITHOUT DEDUCTION OF LIQUIDATED DAMAGES UNDER ARTICLE 9 OF STANDARD GOVERNMENT CONSTRUCTION CONTRACTS (FORM 23), FOR DELAYS DUE TO SHUTDOWN ORDERS OF THE UNITED STATES ISSUED TO FOREST ROAD CONTRACTORS IN CERTAIN OF THE WESTERN STATES, YOUR LETTER OF AUGUST 15, 1928, TO THE EFFECT THAT IN VIEW OF SAID DECISION FISCAL AGENTS OF THE DEPARTMENT OF AGRICULTURE ARE RELUCTANT TO MAKE PROGRESS PAYMENTS TO CONTRACTORS WHERE SUCH DELAYS ARE INVOLVED, WITHOUT DEDUCTION OF LIQUIDATED DAMAGES, FOR FEAR THAT CREDIT THEREFOR MAY BE DISALLOWED IN THE AUDIT OF THEIR ACCOUNTS. YOU INQUIRE WHETHER SOME PROCEDURE MAY NOT BE ADOPTED TO EXPEDITE THE EARNED PROGRESS PAYMENTS TO VARIOUS ROAD CONTRACTORS IN ORDER THAT THEY MAY CONTINUE WITH THEIR CONTRACT WORK.

IT WAS NOT THE PURPOSE OR INTENT OF THE DECISION OF JUNE 21, 1928, TO PRECLUDE THE MAKING OF AUTHORIZED PROGRESS PAYMENTS WHERE THE DELAY WAS DUE TO THE ORDER OF THE GOVERNMENT, THERE BEING NO FAULT ON THE PART OF THE CONTRACTOR.

IT IS UNDERSTOOD THAT IT IS CUSTOMARY IN THE MATTER OF ROAD CONSTRUCTION WORK UNDER THE CONTROL OF THE DEPARTMENT OF AGRICULTURE TO ENTER INTO CONTRACTS AT OR NEAR THE BEGINNING OF A FISCAL-YEAR PERIOD WITH A VIEW TO COMPLETING THE WORK, IF POSSIBLE, DURING SAID FISCAL YEAR; AND THAT IT FREQUENTLY HAPPENS THAT THE WORK CAN NOT BE COMPLETED BEFORE THE BEGINNING OF THE WINTER SEASON, AND THE WEATHER CONDITIONS BECOME SUCH THAT IT IS NECESSARY FROM THE GOVERNMENT'S STANDPOINT TO SUSPEND THE WORK. UNDER SUCH CIRCUMSTANCES THERE IS NO OBJECTION TO OTHERWISE PROPER PROGRESS PAYMENTS BEING MADE BY THE DISBURSING OFFICER WITHOUT DEDUCTION OF LIQUIDATED DAMAGES FOR THE PERIOD OF DELAY INCIDENT TO THE CESSATION OF WORK ON THE WRITTEN ORDER OF THE DISTRICT ENGINEER IN CHARGE OF THE OPERATION.

WHERE, UNDER CONTRACTS FOR THE CONSTRUCTION OF ROADS OR TRAILS, THE WORK IS NOT TO BE COMPLETED UNTIL AFTER THE EXPIRATION OF A WINTER PERIOD, AND IT IS DESIRED THAT THE FINAL PAYMENT, ALSO, BE MADE BY A DISBURSING OFFICER WITHOUT REFERRING THE MATTER TO THIS OFFICE, WHEN THE ONLY DELAY IS DUE TO AN ORDER OF THE GOVERNMENT TO STOP WORK, THE TWO CONCLUDING SENTENCES OF ARTICLE 1 OF THE CONTRACT SHOULD STIPULATE THAT THE CONTRACT PERIOD OF TIME IS EXCLUSIVE OF ANY TIME THAT MAY INTERVENE BETWEEN THE EFFECTIVE DATE OF ORDERS OF THE GOVERNMENT TO SUSPEND OPERATIONS ON ACCOUNT OF WEATHER CONDITIONS AND THE EFFECTIVE DATE OF ORDERS TO RESUME THE WORK.

WITH RESPECT TO DELAY IN THE DIRECT SETTLEMENT OF CLAIMS UNDER CONSTRUCTION CONTRACTS WITH CONSEQUENT EMBARRASSMENT TO CONTRACTORS, YOUR ATTENTION IS INVITED TO THE FACT THAT 23 CLAIMS OF AS MANY CONTRACTORS, WHICH WERE FORWARDED TO THIS OFFICE BY THE DEPARTMENT OF AGRICULTURE FOR DIRECT SETTLEMENT, HAD TO BE RETURNED TO THAT DEPARTMENT FOR PROPER ADMINISTRATIVE REPORT AND RECOMMENDATION SIGNED BY THE PROPER ADMINISTRATIVE OFFICER OF THE DEPARTMENT. IN OTHER WORDS, THE CLAIMS FORWARDED HERE FOR DIRECT SETTLEMENT DID NOT HAVE THE ADMINISTRATIVE REPORT AND RECOMMENDATION APPROVED BY THE OFFICER OF YOUR DEPARTMENT DESIGNATED FOR THAT PURPOSE, AND WHICH APPEAR TO BE REQUIRED UNDER PARAGRAPH 6 (C) OF THE FISCAL REGULATIONS OF YOUR DEPARTMENT. THIS OFFICE CAN NOT, OF COURSE, BE RESPONSIBLE FOR DELAYS RESULTING FROM THE FAILURE OF THE OFFICERS AND EMPLOYEES OF THE DEPARTMENT OF AGRICULTURE IN OBSERVING THE RULES AND REGULATIONS WITH RESPECT TO ADMINISTRATIVE REPORTS AND EXAMINATION OF CLAIMS SENT HERE FOR SETTLEMENT.