B-124527, AUG. 19, 1955

B-124527: Aug 19, 1955

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INC.: REFERENCE IS MADE TO YOUR LETTER OF JUNE 1. TO BE DELIVERED IN RETURNABLE DRUMS WHICH WERE TO BE PAID FOR BY THE GOVERNMENT AT THE RATE OF $60 PER DRUM. WHEN THE DRUMS WERE EMPTIED. THE GOVERNMENT WAS REQUIRED TO RETURN THEM. THE RECORD FURTHER SHOWS THAT YOU DELIVERED THE SIX DRUMS OF COMPOUND AND THAT PAYMENT WAS MADE THEREFOR IN THE AMOUNTS CLAIMED. THAT ONE SUCH DRUM WAS RETURNED BY THE GOVERNMENT ON MARCH 6. TWO OTHERS WERE RETURNED ON AUGUST 6. THAT THE THREE REMAINING DRUMS WERE RETURNED MARCH 24. EXPLAINING THAT THE DEDUCTION WAS NECESSARY DUE TO THE DELAY IN RETURNING THE PROPERTY. THE DEPARTMENT OF THE ARMY MADE A VOUCHER DEDUCTION OF $75 WHEN PAYMENT WAS MADE TO YOU UNDER ANOTHER PURCHASE ORDER.

B-124527, AUG. 19, 1955

TO OCTAGON PROCESS, INC.:

REFERENCE IS MADE TO YOUR LETTER OF JUNE 1, 1955, REQUESTING RECONSIDERATION OF SETTLEMENT DATED APRIL 19, 1955, WHICH DISALLOWED YOUR CLAIM FOR $75 REPRESENTING ALLOWANCE ON THREE EMPTY DRUMS INVOLVED IN THE FURNISHING OF SUPPLIES UNDER DEPARTMENT OF THE ARMY PURCHASE ORDER NO. 1200-51, CONTRACT NO. DA19-058-ORD-1524.

THE RECORD SHOWS THAT THE GOVERNMENT PURCHASED SIX DRUMS OF RUSTSHIELD NO. 2 COMPOUND, TO BE DELIVERED IN RETURNABLE DRUMS WHICH WERE TO BE PAID FOR BY THE GOVERNMENT AT THE RATE OF $60 PER DRUM. WHEN THE DRUMS WERE EMPTIED, THE GOVERNMENT WAS REQUIRED TO RETURN THEM, TRANSPORTATION CHARGES COLLECT TO YOUR ORGANIZATION, AND FOR EACH DRUM SO RETURNED YOU AGREED TO REIMBURSE THE GOVERNMENT AT THE RATE OF $60 PER DRUM.

THE RECORD FURTHER SHOWS THAT YOU DELIVERED THE SIX DRUMS OF COMPOUND AND THAT PAYMENT WAS MADE THEREFOR IN THE AMOUNTS CLAIMED, INCLUDING THE CHARGE OF $60 EACH FOR THE SIX DRUMS; THAT ONE SUCH DRUM WAS RETURNED BY THE GOVERNMENT ON MARCH 6, 1951, AND TWO OTHERS WERE RETURNED ON AUGUST 6, 1952, FOR WHICH YOU REIMBURSED THE GOVERNMENT WITHOUT MAKING ANY COMPLAINT OR PROTEST; THAT THE THREE REMAINING DRUMS WERE RETURNED MARCH 24, 1954; AND THAT YOU DEDUCTED $25 FOR EACH OF THE THREE DRUMS, OR A TOTAL OF $75, AND TRANSMITTED YOUR CHECK FOR $105 ONLY, EXPLAINING THAT THE DEDUCTION WAS NECESSARY DUE TO THE DELAY IN RETURNING THE PROPERTY. AFTER MAKING SEVERAL REQUESTS FOR THE SUM DEDUCTED, THE DEPARTMENT OF THE ARMY MADE A VOUCHER DEDUCTION OF $75 WHEN PAYMENT WAS MADE TO YOU UNDER ANOTHER PURCHASE ORDER.

YOU CONTEND THAT IN THE CHEMICAL INDUSTRY RETURNABLE CONTAINERS ARE ACCEPTED FOR REFUND UP TO ONE YEAR'S TIME, AND SINCE THE THREE DRUMS IN QUESTION WERE NOT RETURNED FOR FOUR YEARS YOU WERE ENTITLED TO MAKE DEDUCTIONS FOR LOSS OF EARNING POWER AND DEPRECIATION.

IN THIS CASE THE CONTRACT DID NOT CONTAIN ANY PROVISION AS TO THE TIME WITHIN WHICH THE DRUMS WERE TO BE RETURNED TO YOU. ALTHOUGH YOU CONTEND THAT IN THE CHEMICAL INDUSTRY RETURNABLE CONTAINERS ARE ACCEPTED UP TO ONE YEAR'S TIME FOR REFUND AND THAT THE RETURN OF THE DRUMS IN QUESTION WAS NOT ACCOMPLISHED WITHIN A REASONABLE TIME, NEVERTHELESS YOU ACCEPTED THEM BEFORE YOU RAISED ANY QUESTION AS TO THE RIGHT OF THE GOVERNMENT TO BE REIMBURSED AT THE RATE OF $60 PER DRUM. WHILE YOU MIGHT HAVE BEEN JUSTIFIED IN REFUSING TO ACCEPT THE RETURN OF THE DRUMS, THERE IS NO SHOWING THAT THEY WERE DAMAGED OR THAT THEIR CONDITION WAS IN ANY WAY DIFFERENT FROM THAT WHICH MIGHT BE ATTRIBUTED TO NORMAL WEAR AND TEAR DURING THE PERIOD THEY WERE IN THE POSSESSION OF THE GOVERNMENT.

ACCORDINGLY, ON THE BASIS OF THE RECORD PRESENTED HERE, THE SETTLEMENT DATED APRIL 19, 1955, IS SUSTAINED.

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