B-105879, JANUARY 15, 1952, 31 COMP. GEN. 282

B-105879: Jan 15, 1952

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OR DESTRUCTION - WAREHOUSEMAN'S LIABILITY A WAREHOUSEMAN WHO STORED GOVERNMENT-OWNED PAPER IN A BUILDING WITHOUT COMPLYING WITH THE STORAGE CONTRACT BUILDING INSPECTION AND APPROVAL REQUIREMENTS IS LIABLE FOR THE LOSS OR DAMAGE OF THE PAPER BY FIRE IN AN AMOUNT SUFFICIENT TO COVER THE MARKET VALUE OF THE DAMAGED PAPER STOCK. EVEN THOUGH THE FIRE MAY HAVE OCCURRED WITHOUT THE CONTRACTOR'S OWN NEGLIGENCE. 1952: REFERENCE IS MADE TO YOUR LETTER OF DECEMBER 5. WHEREIN A DECISION IS REQUESTED AS TO WHETHER THE ROBINSON TERMINAL WAREHOUSE CORPORATION. THE RECORD SHOWS THAT AT THE TIME CONSIDERATION WAS GIVEN TO THE BIDS SUBMITTED FOR FURNISHING STORAGE FACILITIES TO THE GOVERNMENT PRINTING OFFICE ON WHICH THE ABOVE-CITED CONTRACT WAS BASED.

B-105879, JANUARY 15, 1952, 31 COMP. GEN. 282

STORAGE - PUBLIC PROPERTY - DAMAGE, LOSS, OR DESTRUCTION - WAREHOUSEMAN'S LIABILITY A WAREHOUSEMAN WHO STORED GOVERNMENT-OWNED PAPER IN A BUILDING WITHOUT COMPLYING WITH THE STORAGE CONTRACT BUILDING INSPECTION AND APPROVAL REQUIREMENTS IS LIABLE FOR THE LOSS OR DAMAGE OF THE PAPER BY FIRE IN AN AMOUNT SUFFICIENT TO COVER THE MARKET VALUE OF THE DAMAGED PAPER STOCK, TAKING INTO CONSIDERATION THE VALUE OF THE SALVAGED PAPER, TOGETHER WITH AN AMOUNT TO COVER ANY OTHER EXPENSES INCURRED BY THE GOVERNMENT AS A RESULT OF THE FIRE, INCLUDING EXPENSES INCIDENT TO THE SALVAGE OPERATIONS, EVEN THOUGH THE FIRE MAY HAVE OCCURRED WITHOUT THE CONTRACTOR'S OWN NEGLIGENCE.

COMPTROLLER GENERAL WARREN TO THE PUBLIC PRINTER, JANUARY 15, 1952:

REFERENCE IS MADE TO YOUR LETTER OF DECEMBER 5, 1951, AND ACCOMPANYING CORRESPONDENCE, AS SUPPLEMENTED BY LETTER DATED DECEMBER 17, 1951, WHEREIN A DECISION IS REQUESTED AS TO WHETHER THE ROBINSON TERMINAL WAREHOUSE CORPORATION, ALEXANDRIA, VIRGINIA, SHOULD BE CHARGED FOR LOSS AND DAMAGE TO GOVERNMENT-OWNED PAPER STOCK PLACED IN ITS CUSTODY UNDER CONTRACT NO. GP-7099-A, SUCH LOSS AND DAMAGE HAVING RESULTED FROM A FIRE ON NOVEMBER 18, 1951, WHICH DESTROYED ONE OF THE WAREHOUSE BUILDINGS OPERATED BY THE CORPORATION.

THE RECORD SHOWS THAT AT THE TIME CONSIDERATION WAS GIVEN TO THE BIDS SUBMITTED FOR FURNISHING STORAGE FACILITIES TO THE GOVERNMENT PRINTING OFFICE ON WHICH THE ABOVE-CITED CONTRACT WAS BASED, AN INSPECTION OF THE WAREHOUSE BUILDINGS OFFERED BY THE ROBINSON TERMINAL WAREHOUSE CORPORATION WAS MADE BY YOUR OFFICE. THIS INSPECTION DISCLOSED THAT SUCH FACILITIES AS WERE VACANT PROBABLY WOULD NOT AFFORD SUFFICIENT SPACE TO HANDLE 15,000,000 POUNDS OF PAPER AS REQUIRED BY THE INVITATION. WHEN THIS FACT WAS BROUGHT TO ITS ATTENTION THE CORPORATION ADVISED BY LETTER DATED APRIL 12, 1951, AS FOLLOWS:

THIS IS TO ADVISE IN FURTHER CLARIFICATION OF OUR BID WE WILL STORE 15,000,000 POUNDS OF GOVERNMENT PAPER IN ROLLS, SKIDS, PALLETS, BOXES AND CASES IN THE BUILDINGS IN ALEXANDRIA, VIRGINIA, INSPECTED BY THE COMMITTEE FROM THE GOVERNMENT PRINTING OFFICE, OR WE WILL BUILD ADDITIONAL SIMILAR STORAGE OR WE WILL RENT FACILITIES SUBJECT TO YOUR INSPECTION AND APPROVAL.

THE CRITERION FOR A SATISFACTORY BUILDING IS THAT IT WILL BE DRY WITH CONCRETE FLOOR, MASONRY OR STEEL CONSTRUCTION, AND ACCESSIBLE TO TRUCK LOADING AND UNLOADING.

THE BID OF THE ROBINSON TERMINAL WAREHOUSE CORPORATION AS THUS CLARIFIED WAS ACCEPTED ON APRIL 13, 1951. THEREFORE, IT SEEMS CLEAR THAT UNDER THE TERMS OF THE CONTRACT ANY FACILITIES IN ADDITION TO THOSE AVAILABLE AT THE TIME THE CONTRACTOR'S BID WAS SUBMITTED WERE NOT TO BE USED UNLESS INSPECTED AND APPROVED BY THE GOVERNMENT PRINTING OFFICE. THE CONTRACT CONTAINS THE FOLLOWING STIPULATION WITH RESPECT TO LOSS OR DAMAGE:

THE CONTRACTOR'S LIABILITY FOR LOSS OR DAMAGE TO GOVERNMENT PROPERTY SHALL BE THAT OF THE BAILEE OF A MUTUAL BENEFIT BAILMENT.

IT IS STATED IN YOUR LETTER OF DECEMBER 5, 1951, THAT THE FIRE OCCURRED IN A WAREHOUSE BUILDING LOCATED AT PRINCESS AND NORTH LEE STREETS, ALEXANDRIA, VIRGINIA, A BUILDING LEASED BY THE ROBINSON TERMINAL WAREHOUSE CORPORATION FROM THE SOUTHERN RAILWAY; THAT THE CORPORATION HAD STORED GOVERNMENT-OWNED PAPER STOCK IN THIS BUILDING. IT IS ALSO STATED IN YOUR LETTER THAT WHILE AN EMPLOYEE OF THE OFFICE OF THE CHIEF STOREKEEPER, GOVERNMENT PRINTING OFFICE, RECALLS A CONVERSATION WITH AN OFFICIAL OF THE CORPORATION INDICATING THAT ADDITIONAL FACILITIES WERE BEING USED AND THAT ANOTHER BUILDING-- NOT IDENTIFIED--- WAS BEING PREPARED FOR USE IN STORING GOVERNMENT-OWNED PAPER STOCK, THIS PARTICULAR BUILDING WAS NEVER INSPECTED NOR APPROVED BY YOUR OFFICE AND THAT THE FIRST NOTICE IT WAS BEING USED FOR STORING GOVERNMENT-OWNED PAPER WAS RECEIVED ON NOVEMBER 18, 1951, WHEN AN EMPLOYEE OF THE ROBINSON TERMINAL WAREHOUSE CORPORATION ADVISED THE DIRECTOR OF PURCHASES, GOVERNMENT PRINTING OFFICE, THAT THE WAREHOUSE BUILDING AND THE GOVERNMENT PRINTING OFFICE PAPER STORED THEREIN HAD BEEN DESTROYED BY FIRE; THAT THE DAMAGE TO THE PAPER IS ESTIMATED AT APPROXIMATELY $53,000; AND THAT THERE IS A POSSIBILITY OF SALVAGING APPROXIMATELY $7,000 WORTH OF THIS PAPER. IT IS STATED FURTHER IN YOUR LETTER THAT THE CORPORATION HAS ADVISED--- AS SET OUT IN ITS LETTER OF NOVEMBER 27, 1951--- THAT IT IS WILLING TO COOPERATE IN SALVAGING THE DAMAGED STOCK WITH THE UNDERSTANDING THAT IF IT IS LEGALLY DETERMINED THAT THE CORPORATION IS NOT RESPONSIBLE FOR THE DAMAGES THEY WILL CHARGE THE GOVERNMENT PRINTING OFFICE THE GOING LEGAL RATE FOR LABOR AND EQUIPMENT USED BY THEM IN THE SALVAGE WORK. THE CORPORATION HAS TAKEN THE POSITION, HOWEVER, THAT UNDER THE TERMS AND CONDITIONS OF THE CONTRACT OF STORAGE AND IN VIEW OF THE CIRCUMSTANCES OF THE FIRE, THE CORPORATION IS NOT LEGALLY LIABLE.

ACCOMPANYING YOUR LETTER IS A COPY OF THE REPORT OF INVESTIGATION OF THE FIRE BY JOHN E. POSEY, CHIEF, FIRE PREVENTION BUREAU, ALEXANDRIA, VIRGINIA. THIS REPORT DISCLOSES THAT THE FIRE STARTED UNDER A BUILDING OF CORRUGATED TIN AND FRAME CONSTRUCTED ON WOODEN UPRIGHTS ABOUT THREE FEET ABOVE GROUND, LOCATED IN THE 400 BLOCK OF N. FAIRFAX STREET BETWEEN PRINCESS AND ORINOCO STREETS, WHICH WAS USED BY ALEXANDRIA DAIRY PRODUCTS COMPANY; THAT SPARKS FROM THE FIRE IGNITED A BUILDING OF SIMILAR CONSTRUCTION LEASED TO THE DAIRY COMPANY, LOCATED IN THE REAR OF THE FAIRFAX STREET BUILDING; THAT THE BUILDING AT PRINCESS AND NORTH LEE STREETS USED BY THE ROBINSON TERMINAL WAREHOUSE CORPORATION WAS OF FRAME AND BRICK CONSTRUCTION WITH TAR PAPER ROOF; THAT UPON BEING IGNITED BY SPARKS FROM THE FIRE BURNING IN THE OTHER TWO BUILDINGS MENTIONED, THE ROOF OF THE ROBINSON TERMINAL WAREHOUSE BUILDING CAVED IN, SETTING FIRE TO THE PAPER STORED THEREIN, AND THE BUILDING AND ITS CONTENTS WERE DESTROYED. EVIDENCE WAS OBTAINED TO THE EFFECT THAT DRIFTERS AND TRAMPS WERE IN THE HABIT OF CRAWLING UNDER THE FIRST MENTIONED BUILDING FOR SHELTER; THAT FIRES WERE BUILT THEREUNDER TO COOK FOOD AND FURNISH WARMTH, AND THAT THE DESTRUCTION OF THE BUILDING PROBABLY RESULTED FROM SUCH A FIRE BECOMING OUT OF CONTROL AND IGNITING THE FLOOR AND JOISTS OF THE BUILDING. NO EVIDENCE HAS BEEN FURNISHED AS TO WHAT FIRE SAFETY PRECAUTIONS, IF ANY, HAD BEEN ADOPTED BY THE ROBINSON TERMINAL WAREHOUSE CORPORATION WITH RESPECT TO THE BUILDING LOCATED AT PRINCESS AND N. LEE STREETS.

THE RULE IS WELL SETTLED THAT A WAREHOUSEMAN MUST COMPLY WITH THE CONTRACT OF STORAGE. IF HE HAS CONTRACTED TO STORE GOODS IN A SPECIFIED WAREHOUSE OR A PARTICULAR PLACE AND STORES THEM IN A DIFFERENT PLACE, IT IS AT HIS OWN RISK AND HE IS LIABLE FOR THE LOSS OR DAMAGE OF THE GOODS WHICH OCCURS, EVEN THOUGH WITHOUT HIS OWN NEGLIGENCE. SEE THE CASES COLLECTED IN THE ANNOTATIONS 12 A.L.R. 1322, AND 17 ID. 979, AND THE AUTHORITIES CITED THEREIN.

APPLYING THE ABOVE-MENTIONED RULE TO THE FACTS AND CIRCUMSTANCES OF RECORD IN THIS CASE, IT APPEARS THAT THE CONTRACTOR USED THE BUILDING AT PRINCESS AND N. LEE STREETS FOR THE STORAGE OF GOVERNMENT PAPER WITHOUT HAVING IT INSPECTED AND APPROVED BY THE GOVERNMENT PRINTING OFFICE AS REQUIRED BY THE CONTRACT AND, THEREFORE, AT ITS OWN RISK. ACCORDINGLY, THERE SHOULD BE WITHHELD FROM MONEYS OTHERWISE DUE THE CONTRACTOR AN AMOUNT SUFFICIENT TO COVER THE MARKET VALUE OF THE PAPER STOCK DAMAGED OR DESTROYED WHILE STORED IN THIS BUILDING, TAKING INTO CONSIDERATION THE VALUE OF THE SALVAGED PAPER, TOGETHER WITH AN AMOUNT TO COVER ANY OTHER EXPENSES INCURRED BY THE GOVERNMENT AS A RESULT OF THE FIRE, INCLUDING EXPENSES INCIDENT TO THE SALVAGE OPERATIONS. WHEN THE SALVAGING OPERATIONS HAVE BEEN COMPLETED AND THE TOTAL AMOUNT CHARGEABLE TO THE CONTRACTOR HAS BEEN DEFINITELY DETERMINED, THE PERTINENT VOUCHERS, TOGETHER WITH ALL THE DOCUMENTS AND PAPERS RELATING TO THE MATTER SHOULD BE FORWARDED TO THE CLAIMS DIVISION OF THE GENERAL ACCOUNTING OFFICE FOR DIRECT SETTLEMENT.

THE PAPERS FORWARDED FROM YOUR OFFICE FOR CONSIDERATION IN THIS CASE ARE RETURNED HEREWITH AS REQUESTED.