A-23262, JUNE 26, 1928, 7 COMP. GEN. 810

A-23262: Jun 26, 1928

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THE FACT THAT STENOGRAPHIC REPORTING SERVICE UNDER A FORMAL CONTRACT IS TO BE RENDERED FREE OF COST TO THE UNITED STATES DOES NOT RENDER THE CONTRACT VOID FOR LACK OF A CONSIDERATION WHEN THE CONTRACT ALSO CONTAINS MUTUAL PROMISES OF THE CONTRACTING PARTIES BY WHICH EACH CONTRACTING PARTY OBTAINS A SUBSTANTIAL BENEFIT. IS PROHIBITED BY THE PROVISIONS OF SECTION 3679. THE VOLUNTARY SERVICE REFERRED TO IN SAID STATUTE IS NOT NECESSARILY SYNONYMOUS WITH GRATUITOUS SERVICE. SERVICES FURNISHED PURSUANT TO A FORMAL CONTRACT ARE NOT VOLUNTARY WITHIN THE MEANING OF SAID SECTION. 3 COMP. YOUR SUBMISSION ALSO RAISES THE QUESTION WHETHER A CONTRACT FOR RENDEREING SERVICE TO THE UNITED STATES WITHOUT ANY COST WHATEVER TO THE UNITED STATES CONSTITUTES AN ENFORCEABLE CONTRACT OR WHETHER IT IS VOID FOR LACK OF CONSIDERATION.

A-23262, JUNE 26, 1928, 7 COMP. GEN. 810

PERSONAL SERVICES - STENOGRAPHIC REPORTING - FEDERAL TRADE COMMISSION THE FEDERAL TRADE COMMISSION HAVING BEEN AUTHORIZED BY THE ACT OF MAY 16, 1928, 45 STAT. 579, TO OBTAIN STENOGRAPHIC REPORTING SERVICE BY CONTRACT, A CONTRACT FOR SUCH SERVICE SHOULD BE LET TO THE LOWEST RESPONSIBLE BIDDER. STENOGRAPHIC SERVICE TO BE RENDERED UNDER A FORMAL CONTRACT FREE OF COST TO THE UNITED STATES DOES NOT CONSTITUTE VOLUNTARY SERVICE WITHIN THE PURVIEW OF SECTION 3679, REVISED STATUTES, AS AMENDED. THE FACT THAT STENOGRAPHIC REPORTING SERVICE UNDER A FORMAL CONTRACT IS TO BE RENDERED FREE OF COST TO THE UNITED STATES DOES NOT RENDER THE CONTRACT VOID FOR LACK OF A CONSIDERATION WHEN THE CONTRACT ALSO CONTAINS MUTUAL PROMISES OF THE CONTRACTING PARTIES BY WHICH EACH CONTRACTING PARTY OBTAINS A SUBSTANTIAL BENEFIT; I.E., A STENOGRAPHIC REPORTING CONTRACT UNDER WHICH THE CONTRACTOR PROMISES TO DO ALL THE REPORTING TO BE REQUIRED BY THE FEDERAL TRADE COMMISSION UNDER THE CONDITIONS SPECIFIED IN THE CONTRACT AND THE FEDERAL TRADE COMMISSION PROMISES TO GIVE THE CONTRACTOR THE EXCLUSIVE RIGHT TO DO SUCH REPORTING TOGETHER WITH THE EXCLUSIVE RIGHT TO SELL COPIES OF TRANSCRIPTS TO PRIVATE INDIVIDUALS CONSTITUTES MUTUAL PROMISES SUFFICIENT TO SUPPORT A BINDING CONTRACT.

COMPTROLLER GENERAL MCCARL TO THE CHAIRMAN OF THE FEDERAL TRADE COMMISSION, JUNE 26, 1928:

THERE HAS BEEN RECEIVED YOUR LETTER OF JUNE 8, 1928, INCLOSING A LIST OF BIDS RECEIVED FOR STENOGRAPHIC REPORTING FOR YOUR COMMISSION FOR THE FISCAL YEAR 1929, AND REQUESTING DECISION WHETHER ACCEPTANCE OF THE BID OF THE SIDNEY C. ORMSBY CO. IS PROHIBITED BY THE PROVISIONS OF SECTION 3679, REVISED STATUTES.

THE ACT OF MAY 16, 1928, 45 STAT. 579, MAKING APPROPRIATIONS FOR THE EXPENSES OF THE FEDERAL TRADE COMMISSION FOR 1929, PROVIDES:

FOR * * * CONTRACT STENOGRAPHIC REPORTING SERVICES TO BE OBTAINED ON AND AFTER THE APPROVAL OF THIS ACT BY THE COMMISSION, IN ITS DISCRETION THROUGH THE CIVIL SERVICE OR BY CONTRACT, OR RENEWAL OF EXISTING CONTRACT, OR OTHERWISE * * *.

SECTION 3679, REVISED STATUTES, AS AMENDED BY THE ACT OF MARCH 3, 1905, 33 STAT 1257, AND THE ACT OF FEBRUARY 27, 1906, 34 STAT. 48, PROVIDES:

* * * NOR SHALL ANY DEPARTMENT OR OFFICER OF THE GOVERNMENT ACCEPT VOLUNTARY SERVICE FOR THE GOVERNMENT OR EMPLOY PERSONAL SERVICE IN EXCESS OF THAT AUTHORIZED BY LAW, EXCEPT IN CASES OF SUDDEN EMERGENCY INVOLVING THE LOSS OF HUMAN LIFE OR THE DESTRUCTION OF PROPERTY * * *.

THE VOLUNTARY SERVICE REFERRED TO IN SAID STATUTE IS NOT NECESSARILY SYNONYMOUS WITH GRATUITOUS SERVICE, BUT CONTEMPLATES SERVICE FURNISHED ON THE INITIATIVE OF THE PARTY RENDERING THE SAME WITHOUT REQUEST FROM, OR AGREEMENT WITH, THE UNITED STATES THEREFOR. SERVICES FURNISHED PURSUANT TO A FORMAL CONTRACT ARE NOT VOLUNTARY WITHIN THE MEANING OF SAID SECTION. 3 COMP. GEN. 117; 4 ID. 967; 27 COMP. DEC. 131.

YOUR SUBMISSION ALSO RAISES THE QUESTION WHETHER A CONTRACT FOR RENDEREING SERVICE TO THE UNITED STATES WITHOUT ANY COST WHATEVER TO THE UNITED STATES CONSTITUTES AN ENFORCEABLE CONTRACT OR WHETHER IT IS VOID FOR LACK OF CONSIDERATION, AS THE ORMSBY BID PROPOSES TO FURNISH COPIES TO THE COMMISSION WITHOUT CHARGE.

IT IS A WELL-ESTABLISHED PRINCIPLE OF CONTRACT LAW THAT A VALUABLE CONSIDERATION IS NECESSARY TO SUPPORT A CONTRACT. HOWEVER, THE CONSIDERATION NEED NOT NECESSARILY BE A MONETARY ONE. UNDER THE CONTRACT PROPOSED TO BE ENTERED INTO WITH THE SUCCESSFUL BIDDER FOR STENOGRAPHIC REPORTING SERVICES THE UNITED STATES WOULD UNDERTAKE TO GIVE THE CONTRACTOR THE EXCLUSIVE RIGHT TO REPORT ALL PUBLIC PROCEEDINGS OF THE FEDERAL TRADE COMMISSION, UNDER THE CONDITIONS RECITED IN THE CONTRACT, TOGETHER WITH THE EXCLUSIVE PRIVILEGE OF SELLING COPIES OF THE TRANSCRIPTS TO THE PUBLIC AT THE RATES SPECIFIED IN THE CONTRACT, AND THE CONTRACTOR WOULD UNDERTAKE TO REPORT ALL THE PUBLIC PROCEEDINGS OF THE COMMISSION, UNDER THE CONDITIONS SPECIFIED IN THE CONTRACT, AND TO FURNISH TO THE COMMISSION, WITHOUT COST, ALL COPIES REQUIRED BY IT. THESE MUTUAL PROMISES CONSTITUTE A SUFFICIENT CONSIDERATION TO SUPPORT THE CONTRACT WITHOUT THE RECITATION OF ANY MONETARY CONSIDERATION.

THIS LEAVES FOR CONSIDERATION ONLY THE QUESTION OF WHICH IS THE LOWEST RESPONSIBLE BIDDER. 6 COMP. GEN. 158, 430; A-15867, OCTOBER 28, 1926. APPEARS FROM THE PAPERS ACCOMPANYING THE SUBMISSION THAT THE AWARD IS TO BE MADE ONLY FOR SCHEDULE A, THAT IS, FOR REPORTING PUBLIC HEARINGS, AND THAT THE PRIVATE HEARINGS AND CONFERENCES WILL CONTINUE TO BE HANDLED BY THE COMMISSION'S OWN STENOGRAPHERS. AS TO THE SAID SCHEDULE A, THERE ARE ONLY THREE BIDDERS AMONG WHOM THERE IS ANY QUESTION AS TO WHICH IS ENTITLED TO THE AWARD. THE SIDNEY C. ORMSBY CO. PROPOSES TO RENDER THE REQUIRED SERVICE WITHOUT ANY COST WHATEVER TO THE GOVERNMENT AND TO SELL COPIES TO THE PUBLIC AT 30 CENTS PER PAGE FOR ORDINARY COPY AND 40 CENTS PER PAGE FOR DAILY COPY. DAY AND STEWART PROPOSE TO RENDER THE SERVICE AT A COST OF 1 CENT PER PAGE FOR ALL COPIES REQUIRED BY THE COMMISSION, OR, AS AN ALTERNATIVE BID, THREE COPIES FREE OF CHARGE AND 1 CENT PER PAGE FOR SUBITEM 1 OF ITEM 5 AND SUBITEM 1 OF ITEM 6, WITH A CHARGE TO THE PUBLIC OF 30 CENTS PER PAGE FOR EITHER ORDINARY OR DAILY COPY. WALTON, REHFELD AND ROSS PROPOSE TO CHARGE ONE-HALF A CENT PER PAGE FOR ALL COPIES DESIRED BY THE GOVERNMENT AND 22 CENTS PER PAGE FOR ALL COPIES FURNISHED THE PUBLIC.

IT IS EVIDENT THAT, OF THE THREE BIDS, THE BID OF THE ORMSBY CO. IS THE ONE WHICH WILL RESULT IN THE LEAST EXPENDITURE OF PUBLIC FUNDS. THE PRICE TO BE CHARGED THE PUBLIC FOR COPIES IS NOT FOR CONSIDERATION, IF NOT EXORBITANT. A-19040, JUNE 30, 1927. THE PRICES OF 30 AND 40 CENTS PER PAGE QUOTED BY THE ORMSBY CO. FOR PUBLIC COPIES DO NOT APPEAR TO BE SO EXORBITANT AS TO WARRANT REJECTION OF THIS BID, AS AT LEAST ONE OTHER BIDDER QUOTED A STILL HIGHER RATE AND SEVERAL BIDDERS QUOTED RATES ONLY SLIGHTLY LESS.

IN VIEW OF ALL THE CIRCUMSTANCES, THEREFORE, THERE WOULD APPEAR TO BE NO LEGAL OBJECTION TO ACCEPTANCE OF THE BID OF THE SIDNEY C. ORMSBY CO. FOR STENOGRAPHIC REPORTING SERVICE FOR THE FISCAL YEAR 1929 AS PROPOSED.