B-123021, JUL. 29, 1955

B-123021, JUL. 29, 1955

TO R. A. PRENDERGAST AND SON:

REFERENCE IS MADE TO LETTERS DATED JANUARY 31 AND MARCH 8, 1955, WITH ENCLOSURES, FROM BARRETT QUIRK, REQUESTING, IN YOUR BEHALF, REVIEW OF SETTLEMENT DATED JULY 23, 1954, WHICH DISALLOWED YOUR CLAIM FOR $4,438.89, REPRESENTING ADDITIONAL COST OF OVERTIME LABOR ALLEGED TO HAVE BEEN INCURRED IN CONNECTION WITH THE PERFORMANCE OF CONTRACT NO. DA-36-109-ENG- 3725.

THE CONTRACT WAS ENTERED INTO ON SEPTEMBER 2, 1952, AND PROVIDED FOR THE CONSTRUCTION OF AN X-RAY LABORATORY AND REPAIR SHOP AT THE PLANT OF THE BUDD COMPANY, PHILADELPHIA, PENNSYLVANIA. THE COMPLETION DATE WAS FIXED AT FEBRUARY 6, 1953. UNDER THE TERMS OF THE CONTRACT, YOU WERE REQUIRED TO SUBMIT, FOR THE APPROVAL OF THE CONTRACTING OFFICER, A PROGRESS SCHEDULE SHOWING THE ORDER IN WHICH YOU PROPOSED TO CARRY ON THE WORK, THE PERCENTAGE OF WORK SCHEDULED FOR COMPLETION AT ANY TIME, AND TO SHOW PERIODICALLY, AS REQUIRED, THE ACTUAL PROGRESS MADE. THE CONTRACT FURTHER REQUIRED YOU TO FURNISH SUFFICIENT FORCES AND TO WORK SUCH HOURS, INCLUDING OVERTIME OPERATIONS, AS MIGHT BE NECESSARY TO INSURE THE PROSECUTION OF THE WORK IN ACCORDANCE WITH THE APPROVED PROGRESS SCHEDULE. PARAGRAPH GC-5B OF THE CONTRACT PROVIDED THAT IF, IN THE OPINION OF THE CONTRACTING OFFICER, YOU FELL BEHIND THE APPROVED PROGRESS SCHEDULE, THE CONTRACTING OFFICER MIGHT REQUIRE YOU TO TAKE SUCH CORRECTIVE ACTION AS MAY BE DEEMED NECESSARY, INCLUDING OVERTIME OPERATIONS AND INCREASE IN DAYS OF WORK, ALL WITHOUT ADDITIONAL COST TO THE GOVERNMENT. THE RECORD SHOWS THAT BASED ON HIS DETERMINATION THAT YOU HAD FAILED TO PROSECUTE THE WORK IN ACCORDANCE WITH THE APPROVED PROGRESS SCHEDULE, YOU WERE DIRECTED BY THE CONTRACTING OFFICER ON DECEMBER 18, 1952, TO INCREASE YOUR CONSTRUCTION FORCE AND GO ON AN OVERTIME BASIS, INCLUDING SATURDAY WORK. IN COMPLYING WITH THIS DIRECTIVE YOU ALLEGEDLY INCURRED OVERTIME COSTS, FOR WHICH YOU NOW CLAIM REIMBURSEMENT. THE QUESTION FOR CONSIDERATION HERE IS WHETHER THE CONTRACTING OFFICER WAS JUSTIFIED, CONSIDERING ALL THE CIRCUMSTANCES, IN ORDERING YOU ON DECEMBER 18, 1952, TO WORK ON AN OVERTIME BASIS WITHOUT COST TO THE GOVERNMENT.

THE RECORD SHOWS, AND YOU APPARENTLY DO NOT DENY, THAT AS OF DECEMBER 18, 1952, YOU WERE BEHIND IN YOUR SCHEDULED RATE OF CONSTRUCTION. IT IS YOUR CONTENTION, HOWEVER, THAT VARIOUS FACTORS, HEREINAFTER CONSIDERED, RETARDED THE NORMAL PROGRESS OF THE JOB; THAT THESE FACTORS WERE ATTRIBUTABLE TO ACTS OF THE GOVERNMENT; AND THAT THE FAILURE TO MAINTAIN THE APPROVED PROGRESS SCHEDULE WAS IN NOWISE DUE TO YOUR FAULT OR NEGLIGENCE.

IT IS CONTENDED THAT, PRIOR TO THE ISSUANCE OF THE OVERTIME DIRECTIVE, CERTAIN CHANGES WERE MADE IN THE CONTRACT WORK WHICH DELAYED THE PROSECUTION THEREOF AND WHICH WERE SO RECOGNIZED BY THE ISSUANCE OF MODIFICATION NO. 2 TO THE CONTRACT. MODIFICATION NO. 2, ISSUED UNDER DATE OF JUNE 16, 1953, LISTED VARIOUS CHANGES MADE IN THE CONTRACT WORK, SET FORTH THE AMOUNT TO BE PAID THEREFOR, AND GRANTED A 60-DAY EXTENSION OF THE CONTRACT PERFORMANCE PERIOD. IT IS YOUR CONTENTION THAT THIS EXTENSION OF TIME WAS BASED ON THE DELAY ENSUING AS A RESULT OF THE CHANGES MADE IN THE CONTRACT WORK WHEREAS THE CONTRACTING OFFICER REPORTS THAT THE CHANGES WERE REFERRED TO IN THE MODIFICATION SOLELY FOR THE PURPOSE OF PROVIDING PAYMENT THEREFOR; THAT THESE CHANGES WERE RELATIVELY MINOR FOR WHICH NO EXTENSION OF TIME WAS WARRANTED OR GRANTED; AND THAT THE BASIS FOR THE TIME EXTENSION WAS TO COMPENSATE FOR THE DELAY CAUSED PRIMARILY BY THE TARDY DELIVERY OF CERTAIN GOVERNMENT-FURNISHED EQUIPMENT AND, TO A LESSER DEGREE, FOR INCLEMENT WEATHER DELAYING THE APPLICATION OF THE PRIME COAT ON THE ROADWAY, BOTH OF WHICH OCCURRED AFTER THE OVERTIME DIRECTIVE WAS ISSUED.

WHILE IT MAY BE CONCEDED THAT MODIFICATION NO. 2 MAKES NO MENTION OF THE REASONS ASSIGNED BY THE CONTRACTING OFFICER FOR THE TIME EXTENSION, IT OTHERWISE APPEARS FROM THE EVIDENCE OF RECORD THAT THESE WERE, IN FACT, THE REASONS THEREFOR. THE RECORD INCLUDES A PHOTOSTATIC COPY OF THE CONTRACTING OFFICER'S FINDINGS OF FACT, DATED JUNE 5, 1953, IN EXPLANATION OF THE PROPOSED MODIFICATION NO. 2, WHEREIN IT IS EXPRESSLY STATED THAT THE TIME EXTENSION PROPOSED THEREIN WAS FOR THE REASONS AS REPORTED BY THE CONTRACTING OFFICER. MOREOVER, THE RECORD SHOWS THAT YOU WERE FULLY AWARE OF THE FACT THAT, IF ANY EXTENSION OF TIME WAS AUTHORIZED, IT WAS ONLY FOR THE REASONS AS STATED BY THE CONTRACTING OFFICER. IT APPEARS THAT MODIFICATION NO. 2, AS ISSUED, WAS A COMPOSITE OF WHAT WAS ORIGINALLY INTENDED AS TWO SEPARATE MODIFICATIONS. THE FIRST VERSION OF MODIFICATION NO. 2, DATED MARCH 3, 1953, PROVIDED FOR ONLY 30 DAYS' EXTENSION OF TIME FOR "DELAY IN RECEIPT OF CRITICAL MATERIAL.' BY LETTER OF MAY 18, 1953 (AFTER ALL WORK HAD BEEN FINISHED AND ACCEPTED), YOU RETURNED THE MODIFICATION UNSIGNED BECAUSE THE 30 DAYS PROVIDED THEREIN WOULD STILL LEAVE YOU CHARGEABLE WITH LIQUIDATED DAMAGES. IN THAT LETTER REQUESTING AN ADDITIONAL EXTENSION OF TIME, YOU MADE THE SIGNIFICANT STATEMENT THAT "THE PRIME REASON FOR ANY EXTENSION WOULD BE THE SAME CAUSE SHOWN IN THE MODIFICATION"--- NAMELY, DELAY IN RECEIPT OF CRITICAL MATERIAL. THEREAFTER, THE PAYMENT PROVISIONS FOR THE PRIOR CHANGES IN THE CONTRACT WORK, ORIGINALLY INTENDED FOR INCLUSION IN A SEPARATE MODIFICATION, WERE COMBINED WITH THE INCREASED TIME EXTENSION OF 60 DAYS AND EMBODIED IN MODIFICATION NO. 2. IT THUS APPEARS THAT, CONTRARY TO THE CONTENTION NOW MADE IN THE MATTER, AT THE TIME OF THE RECEIPT AND SIGNING OF MODIFICATION NO. 2, YOU THOROUGHLY UNDERSTOOD AND AGREED THAT THE TIME EXTENSION WAS GRANTED, NOT FOR ANY CHANGES IN THE CONTRACT WORK, BUT FOR DELAY IN DELIVERY OF EQUIPMENT AND IN APPLYING THE PRIME COAT ON THE ROADWAY.

CONCERNING THE STATEMENT THAT THE GOVERNMENT HAD NO AUTHORITY UNDER THE CONTRACT TO MAKE CHANGES IN THE WORK WITHOUT MAKING AN APPROPRIATE ADJUSTMENT IN THE TIME FOR COMPLETION OF THE CONTRACT, IT MAY BE CONCEDED THAT IF, BY REASON OF SUCH CHANGES, AN INCREASE IN TIME WAS ,APPROPRIATE" IT SHOULD HAVE BEEN GRANTED. HOWEVER, ALL CHANGES DO NOW WARRANT AN INCREASE IN THE PERFORMANCE PERIOD AND WHERE, AS HERE, IT APPEARS TO HAVE BEEN PROPERLY DETERMINED BY THE CONTRACTING OFFICER THAT THE CHANGES WERE MINOR AND COULD BE ACCOMPLISHED CONCURRENTLY WITH THE MAIN PROJECT WORK, NO ADDITIONAL CONTRACT TIME WAS AUTHORIZED.

WITH RESPECT TO THE ALLEGATION THAT THE CONTRACTING OFFICER DELAYED 18 DAYS IN APPROVING THE CONTRACTOR'S LIST OF SUBCONTRACTORS, THE RECORD SHOWS THAT AT THE TIME YOU RECEIVED THE NOTICE TO PROCEED YOU HAD YOUR SUBCONTRACTORS COMMENCE THE WORK IMMEDIATELY AND AT THE SAME TIME YOU SUBMITTED A LIST OF THEIR NAMES TO THE CONTRACTING OFFICER. IT IS ADMINISTRATIVELY REPORTED THAT YOU SUFFERED NO DELAY BY REASON OF THE TIME TAKEN IN APPROVING THE SUBCONTRACTORS SINCE, DURING THIS PERIOD, YOUR SUBCONTRACTORS WERE WORKING AT THE SITE OF THE PROJECT. THE GOVERNMENT DID NOT REQUIRE THE CONTRACTOR TO PREVENT THE SUBCONTRACTORS FROM WORKING WHILE THE LIST WAS BEING CHECKED FOR APPROVAL.

IT IS ALLEGED THAT A DELAY WAS CAUSED BY A FAULTY ALIGNMENT OF FOUNDATIONS CONSTRUCTED BY ANOTHER CONTRACTOR. IN THIS CONNECTION IT IS ADMINISTRATIVELY REPORTED THAT WORK ON THE PROJECT WAS COMMENCED ON SEPTEMBER 10, 1950; THAT ON SEPTEMBER 22 YOU AND THE RESIDENT ENGINEER FOUND THAT THE PILE CAPS, CONSTRUCTED BY CRAFT BUILDERS, WERE MISALIGNED ABOUT 10 INCHES; THAT ON SEPTEMBER 30, IT WAS DECIDED THAT THE PEDESTALS SAFELY COULD BE PLACED UPON THE PILE CAPS; AND THAT NO ADDITIONAL WORK WAS CAUSED YOU THEREBY. MOREOVER, IT APPEARS FROM A COMPARISON OF THE SEVERAL REVISIONS OF YOUR CONSTRUCTION PROGRESS CHARTS, APPROVED PRIOR TO THE DATE OF THE OVERTIME DIRECTIVE, THAT YOU AND THE CONTRACTING OFFICER WERE IN AGREEMENT THAT NOTHING HAD OCCURRED PRIOR THERETO, INCLUDING THE REFERRED TO CHANGES IN THE WORK AND THE FAULTY ALIGNMENT OF THE FOUNDATIONS, WHICH REQUIRED AN EXTENSION OF THE COMPLETION DATE BEYOND FEBRUARY 6, 1953. RATHER, THE RECORD SHOWS THAT ADJUSTMENT THEREFOR WAS MADE ON THE PROGRESS CHARTS BY A RESCHEDULING IF THE VARIOUS ITEMS OF WORK WITHIN THE ORIGINAL CONTRACT TIME.

CONCERNING THE CONTENTION THAT THERE WAS NO NEED FOR THE RUSH IN CONSTRUCTION SINCE YOU HAD TO WAIT FOR OVER A MONTH FOR THE GOVERNMENT FURNISHED X-RAY EQUIPMENT, THE RECORD SHOWS THAT THE DELAY INVOLVED OCCURRED AFTER THE OVERTIME DIRECTIVE WAS ISSUED AND HAD NO CONNECTION WITH THE LAG IN CONSTRUCTION PROGRESS UP TO DECEMBER 18, 1952. AS STATED IN THE SETTLEMENT OF JULY 23, 1954,"THE CONTRACTING OFFICER WAS NOT REQUIRED TO PERMIT YOU TO CONTINUE DELINQUENT ON THE STRENGTH OF SPECULATION THAT SOMETHING MIGHT HAPPEN LATER WHICH WOULD JUSTIFY EXTENSION OF THE CONTRACT COMPLETION DATE.'

BASED ON THE EVIDENCE OF RECORD, INCLUDING EXCERPTS FROM THE DAILY LOGS OF CONSTRUCTION, IT APPEARS THAT, PRIOR TO THE ISSUANCE OF THE OVERTIME DIRECTIVE, YOU REPEATEDLY WERE ADVISED OF THE LAG IN CONSTRUCTION PROGRESS, AS SUBSTANTIATED BY A COMPARISON OF YOUR COMPLETED WORK WITH THAT SCHEDULED FOR COMPLETION BY THE CURRENT CONSTRUCTION PROGRESS CHART. YOU WERE FREQUENTLY URGED TO CORRECT THIS DELINQUENCY CAUSED BY THE JOB BEING UNDERMANNED AND BY POOR PLANNING AND COORDINATION, PARTICULARLY SO FAR AS CONCERNED THAT PHASE OF OPERATIONS PERFORMED BY YOUR SUBCONTRACTOR FOR THE REINFORCED CONCRETE WORK. SINCE IT THUS APPEARS THAT THE FAILURE TO MAINTAIN THE REQUIRED CONSTRUCTION PROGRESS WAS NOT DUE TO ANY EXCUSABLE CAUSE OF DELAY, THE CONTRACTING OFFICER'S ISSUANCE OF THE OVERTIME DIRECTIVE WAS A PROPER EXERCISE OF THE AUTHORITY VESTED IN HIM UNDER THE TERMS OF THE CONTRACT.