B-120656, NOVEMBER 24, 1954, 34 COMP. GEN. 251

B-120656, NOVEMBER 24, 1954, 34 COMP. GEN. 251

CONTRACTS - LIQUIDATED DAMAGES - REMISSION BY THE COMPTROLLER GENERAL THE AUTHORITY OF THE COMPTROLLER GENERAL TO REMIT OR WAIVE LIQUIDATED DAMAGES ON AN EQUITABLE BASIS UNDER SECTION 10 (A) OF THE FEDERAL PROPERTY AND ADMINISTRATIVE SERVICES ACT OF 1949 REQUIRES THE PRIOR FAVORABLE RECOMMENDATION OF THE HEAD OF THE AGENCY CONCERNED AND ALSO THE SUBMISSION OF EVIDENCE DEFINITELY ESTABLISHING EQUITIES IN FAVOR OF THE CONTRACTOR.

ACTING COMPTROLLER GENERAL WEITZEL TO MR. JACK PICOULT, NOVEMBER 24, 1954:

REFERENCE IS MADE TO YOUR LETTER OF AUGUST 17, 1954, RELATIVE TO OFFICE DECISION OF AUGUST 13, 1954, B-120656, WHICH DENIED YOUR CLAIM FOR REMISSION OF LIQUIDATED DAMAGES DEDUCTED FROM PAYMENTS UNDER CONTRACT NO. GS-02B-2316, FOR INSTALLING NEW BOOKCASES AND NEW HAND RAILS AT THE UNITED STATES POST OFFICE, FOLEY SQUARE, NEW YORK, NEW YORK.

YOU STATE THAT YOU HAVE APPEALED TO THIS OFFICE IN AN EFFORT TO SECURE EQUITABLE RELIEF WITHIN THE MEANING OF THE TERM "EQUITABLE" AS DEFINED IN " FUNK AND WAGNALLS NEW STANDARD DICTIONARY OF THE ENGLISH LANGUAGE.' YOU STATE FURTHER THAT IN RECOMMENDING TO THE ADMINISTRATOR THAT NO RECOMMENDATION BE MADE TO THIS OFFICE, THE BOARD OF REVIEW, GENERAL SERVICES ADMINISTRATION, DID NOT BASE ITS DECISION UPON THE APPLICATION OF PRINCIPLES OF RIGHT AND JUSTICE BUT RATHER UPON "A HIGHLY TECHNICAL INTERPRETATION OF A PRIOR RULING MADE BY THE COMPTROLLER GENERAL.' FINALLY, YOU REQUEST THAT THE DECISION OF AUGUST 13 BY RECONSIDERED, NOT ONLY IN THE LIGHT OF THE FACTS WHICH YOU HAVE PRESENTED, BUT ALSO IN THE LIGHT OF THE TESTIMONY BEFORE THE BOARD OF REVIEW OF MR. WILLIAM A. BOYD, THE GOVERNMENT CONSTRUCTION ENGINEER WHO WAS IN CHARGE OF THE CONTRACT WORK.

UNDER THE TERMS OF SECTION 10 (A) OF THE ACT OF SEPTEMBER 5, 1950, 64 STAT. 578, 591, QUOTED IN THE DECISION OF AUGUST 13, 1954, THE COMPTROLLER GENERAL OF THE UNITED STATES, ON THE RECOMMENDATION OF THE AGENCY HEAD, IS AUTHORIZED TO REMIT LIQUIDATED DAMAGES AS IN HIS DISCRETION MAY BE JUST AND EQUITABLE. THE AUTHORITY THUS VESTED IN THE COMPTROLLER GENERAL TO REMIT LIQUIDATED DAMAGES PROPERLY MAY BE EXERCISED ONLY ON THE BASIS OF A PRIOR RECOMMENDATION OF THE HEAD OF THE AGENCY CONCERNED--- IN THE PRESENT CASE THE ADMINISTRATOR OF GENERAL SERVICES. HOWEVER, UNDER THE STATUTE, THE AUTHORITY OF THE AGENCY HEAD TO MAKE A RECOMMENDATION IS NOT RESTRICTED BY THE PRIOR ACTION OF THE COMPTROLLER GENERAL.

THE DECISION OF THE COMPTROLLER GENERAL TO WHICH REFERENCE WAS MADE BY THE BOARD OF REVIEW WAS RENDERED TO A CLAIMANT WHO ALSO HAD REQUESTED REMISSION OF LIQUIDATED DAMAGES PURSUANT TO THE AUTHORITY OF THE CITED STATUTE. ALTHOUGH THE ADMINISTRATOR, GENERAL SERVICES ADMINISTRATION, RECOMMENDED THAT THE LIQUIDATED DAMAGES ASSESSED IN THAT CASE BE WAIVED, IT WAS THE JUDGMENT OF THE COMPTROLLER GENERAL THAT THE CLAIM DID NOT CONTAIN SUCH ELEMENTS OF EQUITY AS TO WARRANT REMISSION OF LIQUIDATED DAMAGES WHICH HAD ACCRUED TO THE GOVERNMENT UNDER THE TERMS OF THE CONTRACT. IN YOUR CASE THE ADMINISTRATOR HAS NOT RECOMMENDED REMISSION. CONSEQUENTLY, YOUR CLAIM MAY NOT BE ALLOWED BY THIS OFFICE. HOWEVER, EVEN IF THE ADMINISTRATOR HAD SUBMITTED A FAVORABLE RECOMMENDATION, IT WOULD BE MY VIEW THAT YOUR CLAIM LIKEWISE DOES NOT CONTAIN SUCH ELEMENTS OF EQUITY AS TO WARRANT REMISSION OF THE LIQUIDATED DAMAGES.

THE CONTRACT REQUIRED THAT THE WORK BE COMPLETED WITHIN 30 CALENDAR DAYS AFTER DATE OF RECEIPT OF NOTICE TO PROCEED AND PROVIDED FOR THE ASSESSMENT OF LIQUIDATED DAMAGES AT THE RATE OF $10 PER CALENDAR DAY OF DELAY UNLESS SUCH DELAY SHOULD BE FOUND BY THE CONTRACTING OFFICER TO BE DUE TO UNFORESEEABLE CAUSES BEYOND YOUR CONTROL AND WITHOUT YOUR FAULT OR NEGLIGENCE. YOU WERE NOTIFIED ON NOVEMBER 19, 1951, THAT YOUR BID WAS ACCEPTED AND THE CONTRACT WAS AWARDED TO YOU ON THAT DATE. NOTICE TO PROCEED WAS RECEIVED BY YOU ON JANUARY 2, 1952, THUS ESTABLISHING FEBRUARY 1, 1952, AS THE FINAL DATE FOR COMPLETION OF THE WORK. THE WORK WAS SUBSTANTIALLY COMPLETED 249 CALENDAR DAYS AFTER THE DATE SET FOR COMPLETION. HOWEVER, THE PUBLIC BUILDING SERVICES GRANTED AN EXTENSION OF THE TIME FOR PERFORMANCE OF 146 DAYS TO COMPENSATE FOR THE DELAY OF YOUR SUPPLIER WHICH WAS FOUND TO BE DUE PRIMARILY TO PRIORITY DEFENSE ORDERS IN ITS PLANT. IN ADDITION, THE PUBLIC BUILDINGS SERVICES AND THE BOARD OF REVIEW GRANTED EXTENSIONS OF TIME FOR PERFORMANCE AMOUNTING TO A TOTAL OF 15 CALENDAR DAYS FOR DELAY IN APPROVING SHOP DRAWINGS. THUS, THE TIME FOR PERFORMANCE WAS EXTENDED 161 CALENDAR DAYS, LEAVING AN UNEXCUSED DELAY OF 88 CALENDAR DAYS AND LIQUIDATED DAMAGES IN THE AMOUNT OF $880 CHARGEABLE TO YOU UNDER THE TERMS OF YOUR CONTRACT.

AS TO THIS UNEXCUSED DELAY OF 88 DAYS, THE RECORD DOES NOT SHOW THAT YOU WERE DILIGENT IN ARRANGING FOR THE PROCUREMENT OF METAL SHELVING OR IN HAVING SHOP DRAWINGS SUBMITTED FOR APPROVAL. ALTHOUGH THE CONTRACT WAS AWARDED TO YOU ON NOVEMBER 19, 1951, YOU DID NOT NEGOTIATE WITH ANY SUPPLIER PRIOR TO RECEIVING NOTICE TO PROCEED AND IT WAS NOT UNTIL JANUARY 18, 1952, THAT YOU PLACED AN ORDER FOR THE MATERIAL. IN FACT, IT APPEARS THAT ONE SUPPLIER HAD ADVISED YOU BEFORE YOUR BID PROVIDING FOR A 30-DAY PERFORMANCE PERIOD WAS SUBMITTED THAT DELIVERY COULD NOT BE MADE IN LESS THAN 90 DAYS. ALSO, THERE IS NO EVIDENCE THAT YOU MADE ANY ATTEMPT TO HAVE YOU SUPPLIER SUBMIT SHOP DRAWINGS FOR APPROVAL PRIOR TO MARCH 4, 1952.

IT HAS BEEN HELD BY THE COURTS AND THIS OFFICE THAT EQUITY, AMONG OTHER THINGS, IS USED TO DESCRIBE THE STANDING OF A PARTY TO CLAIM RELIEF, THE MERIT OF HIS CLAIM BEING DEPENDENT UPON A SHOWING AS TO HIS ABILITY TO HAVE PREVENTED THE SITUATION IN WHICH HE FINDS HIMSELF. THEREFORE, IN CASES WHERE CLAIMS HAVE BEEN PRESENTED FOR CONSIDERATION UNDER THE STATUTE HERE INVOLVED THIS OFFICE HAS REQUIRED THE SUBMISSION OF EVIDENCE DEFINITELY ESTABLISHING EQUITIES ON BEHALF OF THE CLAIMANT AS A PREREQUISITE FOR FAVORABLE CONSIDERATION. SEE IN THIS CONNECTION THE ENCLOSED COPY OF OFFICE DECISION OF AUGUST 4, 1952, B-105789, 32 COMP. GEN. 67.

RELATIVE TO YOUR CONTENTION THAT THE TIME FOR PERFORMANCE WAS TOO SHORT, THE RECORD SHOWS THAT YOU AGREED TO THE 30-DAY PERIOD FOR PERFORMANCE WITH FULL KNOWLEDGE OF THE RESULTING REQUIREMENTS, AND IT IS REASONABLE TO ASSUME THAT YOU TOOK SUCH PERIOD INTO CONSIDERATION WHEN YOU PREPARED YOUR BID AND DETERMINED YOUR BID PRICE.

ACCORDINGLY, IT MUST AGAIN BE HELD THAT YOUR CLAIM DOES NOT CONTAIN SUCH ELEMENTS OF EQUITY AS TO WARRANT REMISSION OF THE LIQUIDATED DAMAGES IN THE AMOUNT OF $880 WHICH ACCRUED TO THE GOVERNMENT, UNDER THE EXPRESS TERMS OF YOUR CONTRACT.