A-28031, AUGUST 12, 1929, 9 COMP. GEN. 65

A-28031: Aug 12, 1929

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CONTRACTS - DELAYS - ACTUAL DAMAGES WHERE THE ADVERTISEMENT FOR BIDS HAD INFORMED PROSPECTIVE BIDDERS THAT TIME OF DELIVERY WOULD BE CONSIDERED AN IMPORTANT FACTOR IN MAKING THE AWARD AND A HIGHER BIDDER WAS AWARDED THE CONTRACT BECAUSE IT PROPOSED TO MAKE DELIVERY WITHIN A SHORTER PERIOD OF TIME THAN THE LOW BIDDER. THE CONTRACTOR WAS DELAYED IN DELIVERY. THERE WILL BE DEDUCTED FROM THE CONTRACT PRICE A PROPORTIONATE AMOUNT OF THE DIFFERENCE BETWEEN THE LOW BID AND THE ACCEPTED BID BASED ON THE RATIO BETWEEN THE NUMBER OF DAYS' DELAY IN MAKING DELIVERY TO THE DIFFERENCE IN TIME STATED IN THE ACCEPTED FIGURE AND THE LOW FIGURE. 1929: THERE IS BEFORE THIS OFFICE FOR CONSIDERATION THE CLAIM OF BROWN AND SHARPE MANUFACTURING CO.

A-28031, AUGUST 12, 1929, 9 COMP. GEN. 65

CONTRACTS - DELAYS - ACTUAL DAMAGES WHERE THE ADVERTISEMENT FOR BIDS HAD INFORMED PROSPECTIVE BIDDERS THAT TIME OF DELIVERY WOULD BE CONSIDERED AN IMPORTANT FACTOR IN MAKING THE AWARD AND A HIGHER BIDDER WAS AWARDED THE CONTRACT BECAUSE IT PROPOSED TO MAKE DELIVERY WITHIN A SHORTER PERIOD OF TIME THAN THE LOW BIDDER, AND THE CONTRACTOR WAS DELAYED IN DELIVERY, THERE WILL BE DEDUCTED FROM THE CONTRACT PRICE A PROPORTIONATE AMOUNT OF THE DIFFERENCE BETWEEN THE LOW BID AND THE ACCEPTED BID BASED ON THE RATIO BETWEEN THE NUMBER OF DAYS' DELAY IN MAKING DELIVERY TO THE DIFFERENCE IN TIME STATED IN THE ACCEPTED FIGURE AND THE LOW FIGURE.

DECISION BY COMPTROLLER GENERAL MCCARL, AUGUST 12, 1929:

THERE IS BEFORE THIS OFFICE FOR CONSIDERATION THE CLAIM OF BROWN AND SHARPE MANUFACTURING CO. FOR $63.50 FOR ONE GANG SLOTTING CUTTER DELIVERED TO THE DEPARTMENT OF COMMERCE UNDER AN INVITATION DATED APRIL 10, 1929, AND ACCEPTED PROPOSAL DATED APRIL 13, 1929, THEREFOR. THE QUESTION FOR CONSIDERATION IS WHETHER THE CONTRACTOR IS ENTITLED TO THE FULL AMOUNT OF $63.50 FOR THE DELIVERY OF SAID CUTTER.

IT APPEARS THAT THE DEPARTMENT OF COMMERCE ADVERTISED APRIL 10, 1929, FOR A CUTTER WITH THE STATEMENT THAT "TIME OF DELIVERY WILL BE CONSIDERED AN IMPORTANT FACTOR IN MAKING OF AWARD.' BROWN AND SHARPE SUBMITTED A PROPOSAL OF $63.50 FOR FURNISHING THE CUTTER AND OFFERED TO MAKE DELIVERY WITHIN 20 DAYS AFTER RECEIPT OF ORDER. THE FACTORY AND YARD SUPPLY CO. SUBMITTED A PROPOSAL OFFERING TO DELIVER THE CUTTER FOR $59, BUT STATING THAT DELIVERY WOULD BE MADE WITHIN 30 DAYS AFTER THE DATE OF RECEIPT OF ORDER. IN VIEW OF THE FACT THAT THE CUTTER APPEARS TO HAVE BEEN URGENTLY NEEDED, AND IN ACCORDANCE WITH THE STATEMENT CONTAINED IN THE INVITATION FOR BIDS, THE HIGHER BID OF $63.50 WAS ACCEPTED BUT DELIVERY WAS NOT MADE WITHIN 20 DAYS FROM THE DATE OF RECEIPT OF THE ORDER, THE CONTRACTOR REQUIRING 25 DAYS WITHIN WHICH TO MAKE DELIVERY.

THERE WAS NO PROVISION FOR LIQUIDATED DAMAGES STIPULATED IN THE CONTRACT BUT THE GOVERNMENT AGREED TO PAY THE DIFFERENCE BETWEEN $59 AND $63.50, OR $4.50 ADDITIONAL TO HAVE THE CUTTER DELIVERED WITHIN 20 DAYS FROM DATE OF ORDER INSTEAD OF 30 DAYS AS SUBMITTED BY THE LOWEST BIDDER, FOR REASONS STATED AUGUST 6, 1929, BY THE SECRETARY OF COMMERCE, AS FOLLOWS:

* * * I AM INFORMED BY THE DIRECTOR OF THE CENSUS THAT AT THE TIME THIS SPECIAL GANG SLOTTING CUTTER WAS ORDERED, IT APPEARED MOST LIKELY THAT NOVEMBER 1, 1929, WOULD BE THE DATE SELECTED FOR THE COMMENCEMENT OF THE FIFTEENTH DECENNIAL CENSUS. IT WAS NECESSARY, THEREFORE, TO TAKE INTO CONSIDERATION THE SHORT TIME INTERVENING AND TO SECURE POSSESSION OF THE SPECIAL TOOL AT THE EARLIEST MOMENT POSSIBLE. HAD THE LAW PROVIDING FOR TAKING THE CENSUS NOT BEEN CHANGED TO A LATER DATE IT WOULD HAVE TAXED THE MECHANICAL LABORATORY TO THE UTMOST TO PREPARE THE PARTICULAR MACHINE FOR WHICH THIS TOOL WAS NEEDED. IT WAS THEREFORE DEEMED NECESSARY TO ACCEPT THE BID PROVIDING FOR EARLIEST DATE OF DELIVERY.

IN THIS INSTANCE IT SO HAPPENED THAT, DUE TO PRESSURE OF OTHER PHASES OF THE WORK, THE PARTICULAR MACHINE PART FOR WHICH THIS SPECIAL TOOL WAS REQUIRED HAD NOT REACHED A SUFFICIENTLY ADVANCED STAGE IN THE PROCESS OF CONSTRUCTION TO DEMAND THE USE OF THE AFORESAID SPECIAL GANG CUTTER IMMEDIATELY UPON THE EXPIRATION OF THE CONTRACT TIME OF DELIVERY.

IN VIEW OF THE FOREGOING, IT CAN BE STATED THAT THE GOVERNMENT SUFFERED NO LOSS OR DAMAGE DUE TO DELAY IN DELIVERY. * * *

HOWEVER, WHILE IT MAY BE, AND IS DOUBTLESS TRUE, THAT CHANGE IN THE LAW SUBSEQUENT TO THE DATE OF THE ORDER RENDERED IT UNNECESSARY THAT DELIVERY BE SECURED AT THE EARLIEST PRACTICABLE DATE OF THE CUTTER AND THAT AS A RESULT THEREOF THE UNITED STATES SUSTAINED NO DAMAGE BECAUSE OF DELAY IN DELIVERY, THERE IS FOR CONSIDERATION THE FACT THAT THE GOVERNMENT DID NOT GET THAT FOR WHICH IT HAD AGREED TO PAY THE HIGHER PRICE OF $4.50; THAT IS, DELIVERY OF A CUTTER WITHIN 20 DAYS FROM THE DATE OF THE ORDER INSTEAD OF 30 DAYS AS SUBMITTED BY THE LOWEST BIDDER. THE CONTRACTOR HAVING REQUIRED 25 DAYS TO MAKE DELIVERY, OR HAVING CONSUMED ONE-HALF OF THE ADDITIONAL TIME BY ITS DELAY, DID NOT EARN ALL OF THE INCREASED PRICE AND SHOULD HAVE DEDUCTED FROM ITS AGREED PRICE ONE-HALF OF THE ADDITIONAL PAYMENT OF $4.50, OR $2.25, AS ACTUAL DAMAGES SUSTAINED BY THE UNITED STATES THROUGH THE FAILURE OF THE CONTRACTOR TO MAKE DELIVERY AS AGREED AND UPON WHICH BASIS THE UNITED STATES AGREED TO PAY THE SUM OF $63.50. SEE 7 COMP. GEN. 444, 446.

ACCORDINGLY, THE CONTRACTOR WILL BE ALLOWED $63.50 AS THE AGREED PRICE FOR THE CUTTER, LESS $2.25 DAMAGES SUSTAINED BY THE GOVERNMENT ON ACCOUNT OF THE FAILURE OF THE CONTRACTOR TO DELIVER WITHIN THE TIME STIPULATED, OR $61.25 FOR THE CUTTER.