A-20384, NOVEMBER 12, 1927, 7 COMP. GEN. 332

A-20384: Nov 12, 1927

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CONTRACTS - INCREASED COSTS - HAULING AND STORING COAL WHERE A CONTRACT WAS LET AFTER ADVERTISING FOR THE HAULING AND STORING OF COAL AT A FIXED PRICE PER TON. THERE IS NO AUTHORITY FOR THE PAYMENT OF GREATER COMPENSATION FOR ACCOMPLISHING THE WORK ON THE ALLEGED GROUND THAT THE CONTRACTOR WAS MISTAKEN IN HIS ASSUMPTION THE COAL COULD BE STORED WITHOUT DIFFICULTY. 1927: THERE IS FOR CONSIDERATION YOUR REQUEST FOR REVIEW OF SETTLEMENT C 46846- T. WHEREIN CREDIT WAS DISALLOWED FOR AN EXCESS PAYMENT OF $69.70 TO M. WERE REQUESTED FOR HAULING 1 CARLOAD OF BITUMINOUS COAL FROM LOCAL FREIGHT DEPOT AND STORING IN BIN AT THE POST-OFFICE BUILDING. THAT ONLY ONE BID WAS RECEIVED. CLAIMED THAT THE SERVICE PERFORMED WAS WORTH AT LEAST $130.

A-20384, NOVEMBER 12, 1927, 7 COMP. GEN. 332

CONTRACTS - INCREASED COSTS - HAULING AND STORING COAL WHERE A CONTRACT WAS LET AFTER ADVERTISING FOR THE HAULING AND STORING OF COAL AT A FIXED PRICE PER TON, THERE IS NO AUTHORITY FOR THE PAYMENT OF GREATER COMPENSATION FOR ACCOMPLISHING THE WORK ON THE ALLEGED GROUND THAT THE CONTRACTOR WAS MISTAKEN IN HIS ASSUMPTION THE COAL COULD BE STORED WITHOUT DIFFICULTY.

COMPTROLLER GENERAL MCCARL TO THE SECRETARY OF THE TREASURY, NOVEMBER 12, 1927:

THERE IS FOR CONSIDERATION YOUR REQUEST FOR REVIEW OF SETTLEMENT C 46846- T, DATED OCTOBER 29, 1927, PERTAINING TO THE DISBURSING ACCOUNTS OF J. L. SUMMERS, DISBURSING CLERK, TREASURY DEPARTMENT, WHEREIN CREDIT WAS DISALLOWED FOR AN EXCESS PAYMENT OF $69.70 TO M. MCDONOUGH CO., SWAMPSCOTT, MASS., FOR HAULING 40.2 NET TONS OF COAL FROM FREIGHT YARD AT LYNN, MASS., AND STORING IN BIN AT POST-OFFICE BUILDING, LYNN, MASS., ON SEPTEMBER 2 AND 3, 1925. IT APPEARS THAT BY AN ADVERTISEMENT OF AUGUST 31, 1925, POSTED IN THE POST-OFFICE BUILDING AT LYNN, MASS., AND MAILED TO EACH OF NINE PROSPECTIVE BIDDERS OF THAT CITY, PROPOSALS TO BE OPENED SEPTEMBER 1, 1925, WERE REQUESTED FOR HAULING 1 CARLOAD OF BITUMINOUS COAL FROM LOCAL FREIGHT DEPOT AND STORING IN BIN AT THE POST-OFFICE BUILDING, AND THAT ONLY ONE BID WAS RECEIVED--- THE M. MCDONOUGH CO.--- IN A WRITTEN PROPOSAL OF SEPTEMBER 1, 1925, QUOTING $1.50 PER TON OF 2,000 POUNDS FOR DELIVERY IN ACCORDANCE WITH THE ADVERTISEMENT. ORALLY AND BY LETTER OF SEPTEMBER 2, 1925, THE CUSTODIAN ACCEPTED THE BID OF THE M. MCDONOUGH CO. AT $1.50 PER TON.

THE CONTRACTOR, AFTER MAKING DELIVERY OF THE COAL, 40.2 TONS, REFUSED TO SIGN A VOUCHER FOR $60.30, THE AMOUNT DUE AT THE CONTRACT PRICE OF $1.50 PER TON, AND IN A LETTER OF SEPTEMBER 17, 1925, CLAIMED THAT THE SERVICE PERFORMED WAS WORTH AT LEAST $130, AND THAT---

* * * WHEN WE BID ON THIS JOB WE ASSUMED THAT THE BIN WAS EMPTY AND THAT IT WOULD HOLD THE CAR OF COAL, BUT AFTER WE PUT IN THE FIRST TWO LOADS WE FOUND THAT THE BIN WOULD NOT HOLD ANY MORE AND THE MEN HAD TO HANDLE AT LEAST 35 TONS OF COAL FROM LAST YEAR'S SUPPLY BEFORE WE COULD PUT IN ANY MORE COAL IN THE BIN AT A GREAT EXPENSE TO US. THE BIN IS NOT LARGE ENOUGH TO HOLD OVER 1/2 A CAR OF COAL AT ONCE AND WE HAD TO TAKE 6 MEN FOR TWO DAYS TRIMMING THE COAL BACK WITH A GREAT LOSS TO US ON ACCOUNT OF THE TRUCKS HAVING TO WAIT WHILE WE WERE GETTING A CHANCE TO PUT THE COAL IN THE CELLAR.

THE ENTIRE AMOUNT CLAIMED, $130, WAS PAID BY THE DISBURSING CLERK NOVEMBER 10, 1925, ON VOUCHER NO. 23603, AND IN THE AUDIT OF HIS ACCOUNTS CREDIT WAS DISALLOWED FOR $69.70, THE AMOUNT IN EXCESS OF THE CONTRACT PRICE.

IN REQUESTING THAT CREDIT FOR THE ITEM IN QUESTION BE ALLOWED, YOU STATE:

AS IN THE PRESENT CASE, THE TREASURY DEPARTMENT HAS RECEIVED AND PROFITTED BY THE SERVICE FOR WHICH THE $69.70 WAS DISALLOWED, AND ONLY THE CUSTODIAN HAS ACCURATE KNOWLEDGE OF THE REASONABLENESS OF THE CHARGE, TO WHICH HE CERTIFIES; IT IS HOPED THE CREDIT MAY BE ALLOWED, OTHERWISE FUTURE COMPETITION AT THIS PLACE, AND PERHAPS OTHERS, MAY BE DISCOURAGED, TO THE INCONVENIENCE OF AND POSSIBLY AT CONSIDERABLE COST TO THE GOVERNMENT.

UNDER THE TERMS OF THE CONTRACT AS SET FORTH IN THE ADVERTISEMENT, PROPOSAL AND ACCEPTANCE, THE CONTRACTOR AGREED TO TRANSPORT AND STORE THE COAL AT A STATED AMOUNT PER TON, TO BE PAID BY THE GOVERNMENT. THERE WAS NO RESERVATION IN THE AGREEMENT AS TO THE CAPACITY OF THE STORAGE BIN OR AS TO WHETHER IT WAS EMPTY. THE CONDITIONS AND CIRCUMSTANCES RELATIVE TO THE STORAGE SPACE WERE EXACTLY THE SAME WHEN THE BID WAS SUBMITTED AS WHEN THE WORK WAS TO BE PERFORMED. THE ACCEPTANCE OF THE PROPOSAL OF THE CONTRACTOR CONSTITUTED A CONTRACT, AND THE RIGHTS AND LIABILITIES OF THE PARTIES ARE TO BE DETERMINED IN ACCORDANCE THEREWITH. 20 COMP. DEC. 304; 3 COMP. GEN. 51.

THE GOVERNMENT RECEIVED NOTHING MORE FROM THE CONTRACTOR THAN WAS PROVIDED FOR IN THE CONTRACT, TO WIT, THE STORAGE OF THE COAL IN ITS BIN; AND THE ONLY CONSIDERATION PROVIDED IN THE CONTRACT FOR SUCH STORAGE IS THE AGREED PRICE OF $1.50 PER TON.

THE CONTRACTOR IN HIS AFOREMENTIONED AND PARTIALLY QUOTED LETTER STATED IN EFFECT THAT THE COAL BIN WOULD NOT HOLD OVER ONE-HALF A CAR OF COAL AT ONE TIME, WHEREAS THE REPORT OF THE CUSTODIAN EMBRACING THE FOLLOWING STATEMENT INDICATED THAT THE CARLOAD OF COAL WAS ACTUALLY IN THE BIN AT THE COMPLETION OF THE JOB, TOGETHER WITH THE SUPPLY OF OLD COAL:

AS STATED IN THE MCDONOUGH COMMUNICATION, THERE WAS, IN OUR BIN, CONSIDERABLE COAL (AT LEAST 25 TONS) LEFT OVER FROM LAST YEAR. GREAT DIFFICULTY WAS EXPERIENCED IN STORING THE ADDITIONAL 40 TONS. APPEARED, FOR A WHILE, THAT THERE WOULD BE AN OVERFLOW AND THAT SEVERAL TONS WOULD HAVE TO BE WHEELED INTO BOILER ROOM. RATHER THAN HAVE THIS DONE WE URGED THAT EVERY EFFORT BE MADE TO STORE ALL OF THE COAL IN BIN--- THE COAL WAS SO STORED BY USING PRACTICALLY EVERY INCH OF SPACE IN BIN.

THE EVIDENCE DOES NOT DEFINITELY ESTABLISH WHETHER THE OLD COAL WAS NECESSARILY MOVED, OR ONLY THE NEW SUPPLY, OR A PART THEREOF, WAS TRIMMED BACK IN SUCH A WAY THAT PRACTICALLY ALL SPACE IN THE BIN WAS OCCUPIED AT THE COMPLETION OF THE WORK. HOWEVER, THAT POINT IS NOT MATERIAL. IT IS ESTABLISHED THAT THE BIN DID HOLD ALL OF THE COAL STORED BY THE CONTRACTOR UNDER THE CONTRACT IN ADDITION TO THE OLD COAL THERETOFORE IN THE BIN. WHATEVER DIFFICULTY AND EXPENSE THE CONTRACTOR MAY HAVE INCURRED IN STORING AWAY THE CARLOAD OF COAL IN THIS CASE, DUE TO THE SIZE, SHAPE, OR CONDITION OF THE BIN, IT PERFORMED NO SERVICE OTHER THAN THAT REQUIRED BY THE CONTRACT, AND WAS ENTITLED ONLY TO THE CONTRACT PRICE. YOU SUGGEST A POSSIBLE INCONVENIENCE AND LOSS TO THE GOVERNMENT IN SIMILAR FUTURE CONTRACTS FOR SUCH SERVICES BUT I AM SURE YOU WILL AGREE THAT ANY PROCEDURE WHICH WOULD AUTHORIZE THE DISREGARDING OF COMPENSATION FIXED IN A CONTRACT WOULD BE OF THE GRAVEST CONCERN TO BOTH THE GOVERNMENT AND CONTRACTS. IT WOULD BE PROVOCATIVE OF BOTH FRAUD AND HARDSHIP.

THERE APPEARING IN THE FACTS SUBMITTED NO LEGAL BASIS FOR PAYMENT OF ANY AMOUNT IN ADDITION TO THE CONTRACT PRICE OF $60.30, CREDIT FOR THE ADDITIONAL AMOUNT, $69.70, PAID BY THE DISBURSING CLERK, IS UNAUTHORIZED.