A-60878, MARCH 23, 1935, 14 COMP. GEN. 723

A-60878: Mar 23, 1935

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THIS OFFICE IS IN RECEIPT OF A LETTER DATED MARCH 12. WE REGRET VERY MUCH TO REPORT THAT UP TO DATE OF WRITING WE HAVE NOT MADE UP A SINGLE POUND OF CASTINGS TO APPLY TO THIS CONTRACT. WE WERE INFORMED THAT WHILE CONGRESS HAD APPROVED A LIST OF PROJECTS THAT WERE PROPOSED TO BE HANDLED. WITH THE RESULT THAT ALL PLANS HAVE BEEN HELD IN ABEYANCE UNTIL THE FUNDS ARE IN HAND. THIS HAS BEEN A GREAT DISAPPOINTMENT TO US NOT ONLY THAT THE ANTICIPATED TONNAGE DID NOT MATERIALIZE WHICH WOULD HAVE GIVEN A MORE STEADY TIME OF EMPLOYMENT TO OUR MEN. ALSO THAT THE BID WAS IN COMPETITION WITH FOUR OR FIVE OTHER FIRMS. AS NINE MONTHS OF THE CONTRACT HAVE ELAPSED WITHOUT A SINGLE TRANSACTION. WILL YOU NOT GRANT US A CORRESPONDING EXTENSION OF TIME?

A-60878, MARCH 23, 1935, 14 COMP. GEN. 723

CONTRACTS - INDEFINITE PROVISIONS AS TO TIME OF DELIVERY AND QUANTITY OF MATERIAL APPROPRIATE ADMINISTRATIVE ACTION SHOULD BE TAKEN TO PREVENT THE EXECUTION OF CONTRACTS BY FEDERAL CONTRACTING OFFICERS WHICH PROVIDE FOR PURCHASE OF MATERIAL BY THE GOVERNMENT TO BE FURNISHED AT SUCH TIMES AND IN SUCH QUANTITIES AS MAY BE REQUIRED DURING THE FISCAL YEAR TO THE EXTENT OF A STATED APPROXIMATE AMOUNT.

COMPTROLLER GENERAL MCCARL TO THE SECRETARY OF THE TREASURY, MARCH 23, 1935:

WITH REFERENCE TO CONTRACT TCG-22627, DATED JUNE 11, 1934, BETWEEN THE UNITED STATES, REPRESENTED BY T. A. SHANLEY, UNITED STATES COAST GUARD, TREASURY DEPARTMENT, AND LEVERING BROTHERS, INCORPORATED, THIS OFFICE IS IN RECEIPT OF A LETTER DATED MARCH 12, 1935, FROM THE CONTRACTOR, AS FOLLOWS:

ON JULY 1ST, 1934, UNDER SCHEDULE NO. 1308, WE TENDERED THE LOWEST RESPONSIBLE BID FOR THE FURNISHING OF APPROXIMATELY 60,000 POUNDS OF GRAY IRON CASTINGS TO BE DELIVERED OVER A PERIOD EXTENDING FROM THE ABOVE DATE UNTIL JUNE 30TH, 1935, TO THE U.S. COAST GUARD STATION, CURTIS BAY, MD.

WE REGRET VERY MUCH TO REPORT THAT UP TO DATE OF WRITING WE HAVE NOT MADE UP A SINGLE POUND OF CASTINGS TO APPLY TO THIS CONTRACT. ON QUESTION TO THE SUPPLY OFFICER AT THE STATION, WE WERE INFORMED THAT WHILE CONGRESS HAD APPROVED A LIST OF PROJECTS THAT WERE PROPOSED TO BE HANDLED, THEY HAD NOT APPROPRIATED THE NECESSARY FUNDS, WITH THE RESULT THAT ALL PLANS HAVE BEEN HELD IN ABEYANCE UNTIL THE FUNDS ARE IN HAND.

NATURALLY, THIS HAS BEEN A GREAT DISAPPOINTMENT TO US NOT ONLY THAT THE ANTICIPATED TONNAGE DID NOT MATERIALIZE WHICH WOULD HAVE GIVEN A MORE STEADY TIME OF EMPLOYMENT TO OUR MEN, BUT ALSO THAT THE BID WAS IN COMPETITION WITH FOUR OR FIVE OTHER FIRMS.

AS NINE MONTHS OF THE CONTRACT HAVE ELAPSED WITHOUT A SINGLE TRANSACTION, WILL YOU NOT GRANT US A CORRESPONDING EXTENSION OF TIME? UNDER THE CIRCUMSTANCES, WE DO NOT FEEL THAT OUR REQUEST IS UNREASONABLE OR OUT OF ORDER AND SINCERELY TRUST THAT YOU WILL CONCUR IN THIS THOUGHT.

THE CONTRACT FOR THE CASTINGS PROVIDED THAT THEY WERE "TO BE FURNISHED AT SUCH TIMES AND IN SUCH QUANTITIES AS MAY BE REQUIRED DURING THE PERIOD 1 JULY, 1934, TO 30 JUNE, 1935, TO THE EXTENT OF APPROXIMATELY 60,000 POUNDS.' ASIDE FROM THE QUESTION WHY A CONTRACT SHOULD HAVE BEEN ENTERED INTO ON A FISCAL-YEAR BASIS FOR THE DELIVERY OF GRAY IRON CASTINGS INSTEAD OF FROM TIME TO TIME FOR SPECIFIC QUANTITIES TO MEET EXISTING PUBLIC NEEDS, THERE WOULD APPEAR TO BE A QUESTION AS TO THE LEGALITY OF THIS CONTRACT. IF IT BE INTERPRETED AS NOTHING MORE THAN A "WISH, WANT, AND ILL" CONTRACT, IT MAY BE VOID FOR WANT OF MUTUALITY. SEE WILLARD, SUTHERLAND COMPANY V. UNITED STATES, 262 U.S. 489; UPDIKE, TRUSTEE, V. UNITED STATES. 69 CT.CLS. 394. IF THE CONTRACT BE INTERPRETED AS REQUIRING DELIVERY OF APPROXIMATELY 60,000 POUNDS DURING THE FISCAL YEAR 1935, THE UNITED STATES MIGHT BE LIABLE FOR ANY FAILURE TO ISSUE ORDERS AND ACCEPT DELIVERY OF SAID QUANTITY UNDER THE PRINCIPLES APPLIED IN JOHNSTOWN COAL AND COKE CO. V. UNITED STATES, 66 CT.CLS. 616, WITH WHICH COMPARE BICKETT COAL AND COKE CO. V. UNITED STATES. 67 CT.CLS. 53.

THERE APPEARS NO NECESSITY FOR THE UNITED STATES CONTRACTING UPON SUCH A BASIS AS TO RESULT IN DOUBTS AND UNCERTAINTIES WITH POSSIBLE LITIGATION, AND IT IS REQUESTED THAT APPROPRIATE ADMINISTRATIVE ACTION BE TAKEN TO PREVENT THE EXECUTION OF FURTHER SIMILAR CONTRACTS BY OFFICERS AND EMPLOYEES OF THE TREASURY DEPARTMENT.