A-54011, A-57533, SEPTEMBER 26, 1934, 14 COMP. GEN. 252

A-54011,A-57533: Sep 26, 1934

Additional Materials:

Contact:

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

 

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

WHICH BID WAS ACCEPTED SUBSEQUENT THERETO. IS ENTITLED TO RELIEF UNDER SAID ACT. WOULD DEPEND ON WHETHER THE GENERAL CONTRACT WITH THE UNITED STATES WAS ENTERED INTO PRIOR TO AUGUST 10. AS FOLLOWS: THERE IS ATTACHED HERETO A COPY OF A LETTER RECEIVED FROM THE OTIS ELEVATOR COMPANY RELATIVE TO RELIEF UNDER PUBLIC ACT 369. THE LETTER SUGGESTS THE FOLLOWING QUESTIONS: (1) IS A GENERAL CONTRACTOR WHO HAD SUBMITTED HIS BID FOR GOVERNMENT WORK PRIOR TO AUGUST 10. WHICH BID WAS ACCEPTED SUBSEQUENT THERETO. ENTITLED TO RELIEF UNDER THE ACT? (2) IS A SUBCONTRACTOR WHO HAD SUBMITTED HIS BID TO THE GENERAL CONTRACTOR PRIOR TO AUGUST 10. WHICH BID WAS ACCEPTED SUBSEQUENT THERETO. SINCE THE ADJUSTMENT AND SETTLEMENT OF CLAIMS UNDER PUBLIC ACT 369 IS VESTED IN YOU.

A-54011, A-57533, SEPTEMBER 26, 1934, 14 COMP. GEN. 252

CONTRACTORS - RELIEF ACT THE SUBMISSION OF A BID BY A CONTRACTOR TO THE GOVERNMENT OR BY A SUBCONTRACTOR TO THE CONTRACTOR PRIOR TO AUGUST 10, 1933, WITH THE ACCEPTANCE OF THE BID SUBMITTED BY THE CONTRACTOR SUBSEQUENT TO AUGUST 10, 1933, AND THE ENTRY INTO A CONTRACT SUBSEQUENT TO THE ACCEPTANCE OF THE BID DOES NOT MEET THE REQUIREMENTS OF THE ACT OF JUNE 16, 1934, 48 STAT. 974, AUTHORIZING THE ADJUDICATION AND SETTLEMENT ON A FAIR AND EQUITABLE BASIS OF CLAIMS OF PERSONS WHO ENTERED INTO A CONTRACT WITH THE UNITED STATES PRIOR TO AUGUST 10, 1933. WHETHER A SUBCONTRACTOR WHO SUBMITTED HIS BID TO THE GENERAL CONTRACTOR PRIOR TO AUGUST 10, 1933, WHICH BID WAS ACCEPTED SUBSEQUENT THERETO, IS ENTITLED TO RELIEF UNDER SAID ACT, WOULD DEPEND ON WHETHER THE GENERAL CONTRACT WITH THE UNITED STATES WAS ENTERED INTO PRIOR TO AUGUST 10, 1933.

COMPTROLLER GENERAL MCCARL TO THE SECRETARY OF THE TREASURY, SEPTEMBER 26, 1934:

THERE HAS BEEN RECEIVED YOUR LETTER OF AUGUST 30, 1934, AS FOLLOWS:

THERE IS ATTACHED HERETO A COPY OF A LETTER RECEIVED FROM THE OTIS ELEVATOR COMPANY RELATIVE TO RELIEF UNDER PUBLIC ACT 369.

THE LETTER SUGGESTS THE FOLLOWING QUESTIONS:

(1) IS A GENERAL CONTRACTOR WHO HAD SUBMITTED HIS BID FOR GOVERNMENT WORK PRIOR TO AUGUST 10, 1933, WHICH BID WAS ACCEPTED SUBSEQUENT THERETO, ENTITLED TO RELIEF UNDER THE ACT?

(2) IS A SUBCONTRACTOR WHO HAD SUBMITTED HIS BID TO THE GENERAL CONTRACTOR PRIOR TO AUGUST 10, 1933, WHICH BID WAS ACCEPTED SUBSEQUENT THERETO, ENTITLED TO RELIEF UNDER THE ACT?

SINCE THE ADJUSTMENT AND SETTLEMENT OF CLAIMS UNDER PUBLIC ACT 369 IS VESTED IN YOU, THE ABOVE QUESTIONS ARE SUBMITTED FOR YOUR DETERMINATION AT THIS TIME IN ORDER TO AVOID THE DELAY AND EXPENSE ATTENDANT UPON AN INVESTIGATION OF THE FACTS IN THIS AND SIMILAR CASES PRIOR TO A RULING BY YOU.

AS STATED IN DECISION OF JULY 24, 1934, TO YOU, CONCERNING THE TERMS OF PUBLIC, NO. 369, SEVENTY-THIRD CONGRESS, APPROVED JUNE 16, 1934, AUTHORITY WAS CONFERRED TO ADJUST AND SETTLE ON A FAIR AND EQUITABLE BASIS, CLAIMS OF PERSONS WHO ENTERED INTO A CONTRACT OR CONTRACTS WITH THE UNITED STATES PRIOR TO AUGUST 10, 1933,"INCLUDING SUBCONTRACTORS AND MATERIAL MEN PERFORMING WORK OR FURNISHING MATERIAL OR NECESSARY FUEL DIRECT TO THE CONTRACTOR UNDER SUCH CONTRACT.' THE SUBMISSION OF A BID BY A CONTRACTOR TO THE GOVERNMENT OR BY A SUBCONTRACTOR TO THE CONTRACTOR PRIOR TO AUGUST 10, 1933, WITH THE ACCEPTANCE OF THE BID SUBMITTED BY THE CONTRACTOR SUBSEQUENT TO AUGUST 10, 1933, AND THE ENTRY INTO A CONTRACT SUBSEQUENT TO THE ACCEPTANCE OF THE BID DOES NOT MEET THE REQUIREMENTS OF THE ACT OF JUNE 16, 1934, THAT THE CONTRACT MUST HAVE BEEN ENTERED INTO WITH THE UNITED STATES "PRIOR TO AUGUST 10, 1933.' THERE IS A WELL-DEFINED DISTINCTION IN THE LAW BETWEEN THE SUBMISSION OF BIDS FOR THE PERFORMANCE OF GOVERNMENT WORK, THE ACCEPTANCE OF ONE OF THE BIDS, AND FINALLY THE EXECUTION OF A CONTRACT ON THE BASIS OF THE ACCEPTED BID. (SEE, IN THIS CONNECTION, CLARK V. UNITED STATES, 95 U.S. 539; BRAWLEY V. UNITED STATES, 96 U.S. 168; AND SIMPSON V. UNITED STATES, 172 U.S. 379. COMPARE UNITED STATES V. PURCELL ENVELOPE CO., 249 U.S. 313.)

ACCORDINGLY, YOUR FIRST QUESTION IS ANSWERED IN THE NEGATIVE.

A CATEGORICAL ANSWER CANNOT BE GIVEN TO YOUR SECOND QUESTION ON THE BASIS OF THE FACTS STATED. THE MATTER DEPENDS, UNDER THE ACT OF JUNE 16, 1934, ON WHETHER THE CONTRACT BETWEEN THE UNITED STATES AND THE CONTRACTOR WAS ENTERED INTO PRIOR TO AUGUST 10, 1933. IF SUCH CONTRACT WAS ENTERED INTO PRIOR TO AUGUST 10, 1933, IT IS NOT MATERIAL WHETHER THE CONTRACTOR ACCEPTED THE BID OF THE SUBCONTRACTOR PRIOR OR SUBSEQUENT TO AUGUST 10, 1933, INSOFAR AS THE RIGHT OF THE SUBCONTRACTOR IS CONCERNED TO PRESENT CLAIMS UNDER THE ACT OF JUNE 16, 1934, BUT IF THE BID WAS SUBMITTED SUBSEQUENT TO AUGUST 10, 1933, ALL THE FACTS WOULD BE REQUIRED AS TO WHETHER SUCH SUBCONTRACTOR WAS COMPLYING WITH THE APPLICABLE APPROVED CODE OF FAIR COMPETITION OR THE PRESIDENT'S REEMPLOYMENT AGREEMENT AT THE TIME THE BID WAS SUBMITTED OR THE SUBCONTRACT ENTERED INTO, AND, IF SO, IT MUST BE PRESUMED THAT THE BID PRICE OR SUBCONTRACT PRICE INCLUDED ALL EXCESS COSTS DUE TO SUCH COMPLIANCE, AND IN THE ABSENCE OF A VERY CLEAR SHOWING TO THE CONTRARY SUCH CLAIMS OF SUBCONTRACTORS BASED ON BIDS SUBMITTED TO THE CONTRACTOR OR SUBCONTRACTORS ENTERED INTO SUBSEQUENT TO AUGUST 10, 1933, ARE NOT FOR ALLOWANCE.