B-124130, AUG. 10, 1955

B-124130: Aug 10, 1955

Additional Materials:

Contact:

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

 

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

TO ATLANTIC HARDWARE AND SUPPLY CORPORATION: REFERENCE IS MADE TO YOUR LETTER OF MAY 2. YOU DENY LIABILITY ON THE GROUND THAT THE CHANGE IN DESTINATION WAS NOT REQUESTED BY YOU. THAT YOUR PRICE WAS DELIVERED PRICE REGARDLESS OF DESTINATION. ACCEPTANCE POINT NAMED IN THE CONTRACT WAS CHANGED TO THE PLANT OF YOUR SUBSTITUTED SUPPLIER. UNDER SPECIAL PROVISION 13 OF THE CONTRACT IT WAS PROVIDED THAT "THE PRICES INDICATED INCLUDE THE COST OF TRANSPORTATION FROM THE POINT OF ORIGIN TO THE DESTINATION SET FORTH HEREIN AND ALL SHIPMENTS HEREUNDER SHALL BE PREPAID AND MADE AT THE CONTRACTOR'S EXPENSE.'. WAS SPECIFIED AS THE PARTICULAR POINT OF DELIVERY. IS DIRECTED TO GENERAL PROVISION 2 OF THE GENERAL PROVISIONS (SUPPLY CONTRACT) MADE A PART OF THE CONTRACT.

B-124130, AUG. 10, 1955

TO ATLANTIC HARDWARE AND SUPPLY CORPORATION:

REFERENCE IS MADE TO YOUR LETTER OF MAY 2, 1955, RELATIVE TO YOUR INDEBTEDNESS TO THE UNITED STATES IN THE AMOUNT OF $471.47, REPRESENTING AN OVERPAYMENT MADE TO YOU FOR THE SHIPMENT OF CERTAIN WIRE CLOTH UNDER CONTRACT NO. DA-23-065 ENG-2297 (PURCHASE ORDER NO. 34-7006-50), DATED FEBRUARY 4, 1952. YOU DENY LIABILITY ON THE GROUND THAT THE CHANGE IN DESTINATION WAS NOT REQUESTED BY YOU, BUT BY THE CORPS OF ENGINEERS, AND THAT YOUR PRICE WAS DELIVERED PRICE REGARDLESS OF DESTINATION.

UNDER THE CONTRACT YOU AGREED TO FURNISH THE SPECIFIED QUANTITY OF WIRE CLOTH, F.O.B. OAKLAND, CALIFORNIA, WITH ORIGIN, INSPECTION, AND ACCEPTANCE POINTS AT HELIG BROS., YORK, PENNSYLVANIA. THE RECORD SHOWS THAT IN RESPONSE TO YOUR REQUEST, THE ORIGIN, INSPECTION, AND ACCEPTANCE POINT NAMED IN THE CONTRACT WAS CHANGED TO THE PLANT OF YOUR SUBSTITUTED SUPPLIER, GILBERT AND BENNETT CO., GEORGETOWN, CONNECTICUT, BY WRITTEN AUTHORITY DATED MAY 12, 1952, TO YOU. THEREAFTER, BUT PRIOR TO ACTUAL SHIPMENT, THE GOVERNMENT CHANGED THE "PLACE OF DELIVERY" TO THE NEW YORK PORT OF EMBARKATION, STAPLETON, STATEN ISLAND, NEW YORK.

UNDER SPECIAL PROVISION 13 OF THE CONTRACT IT WAS PROVIDED THAT "THE PRICES INDICATED INCLUDE THE COST OF TRANSPORTATION FROM THE POINT OF ORIGIN TO THE DESTINATION SET FORTH HEREIN AND ALL SHIPMENTS HEREUNDER SHALL BE PREPAID AND MADE AT THE CONTRACTOR'S EXPENSE.' IN THE DELIVERY SCHEDULE SET OUT IN THE FOLLOWING SPECIAL PROVISION 14, OAKLAND, CALIFORNIA, WAS SPECIFIED AS THE PARTICULAR POINT OF DELIVERY. YOUR PARTICULAR ATTENTION, HOWEVER, IS DIRECTED TO GENERAL PROVISION 2 OF THE GENERAL PROVISIONS (SUPPLY CONTRACT) MADE A PART OF THE CONTRACT, WHEREIN IT WAS SPECIFICALLY PROVIDED THAT THE CONTRACTING OFFICER MAY AT ANY TIME MAKE A CHANGE IN THE PLACE OF DELIVERY; AND THAT "IF ANY SUCH CHANGE CAUSES AN INCREASE OR DECREASE IN THE COST OF, OR THE TIME REQUIRED FOR, THE PERFORMANCE OF THIS CONTRACT, AN EQUITABLE ADJUSTMENT SHALL BE MADE IN THE CONTRACT PRICE.'

BY VIRTUE OF THESE PROVISIONS YOU ASSUMED, AS A PART OF THE CONTRACT PRICE, THE COST OF TRANSPORTATION FROM THE POINT OF ORIGIN TO THE SCHEDULED DISTRINATION POINT, AND AGREED THAT IF ANY CHANGE BY THE CONTRACTING OFFICER IN THE PRICE OF DELIVERY RESULTED IN A REDUCTION OF TRANSPORTATION COSTS THERE WOULD BE A DOWNWARD ADJUSTMENT IN THE CONTRACT PRICE.

IT IS THUS APPARENT THAT THE CHANGE IN DESTINATION BY THE GOVERNMENT, RATHER THAN BY YOU, HAS NO MATERIAL BEARING ON THE QUESTION OF YOUR LIABILITY, AND THAT YOUR CONTENTION THAT THE CONTRACT PRICE WAS A FIRM PRICE REGARDLESS OF DESTINATION IS CONTRARY TO THE SPECIFIC TERMS OF YOUR AGREEMENT.

FOR THESE REASONS THE ACTION TAKEN IN CERTIFYING YOU TO BE INDEBTED TO THE UNITED STATES IN THE AMOUNT OF $471.47, IS SUSTAINED, AND YOU ARE AGAIN REQUESTED TO REMIT THAT AMOUNT TO THIS OFFICE BY CHECK OR MONEY ORDERS MADE PAYABLE TO THE TREASURER OF THE UNITED STATES. FAILURE TO COMPLY WITH THIS REQUEST WITHIN 30 DAYS FROM THE RECEIPT OF THIS LETTER WILL LEAVE US NO ALTERNATIVE BUT TO REFER THE MATTER TO THE DEPARTMENT OF JUSTICE FOR APPROPRIATE COLLECTION ACTION.