B-126955, MAR. 21, 1956

B-126955: Mar 21, 1956

Additional Materials:

Contact:

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

 

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

TO DIAMOND T MOTOR CAR COMPANY: REFERENCE IS MADE TO YOUR LETTER OF FEBRUARY 8. YOU STATE THAT THE DELAY OF ONE DAY IN DELIVERY WAS DUE TO A TORNADO WHICH STRUCK AND DAMAGED THE PLANT OF THE COMPANY WITH WHICH YOU HAD SUBCONTRACTED THE BODY JOB AND THAT YOUR FAILURE TO EFFECT DELIVERY WITHIN THE SPECIFIED TIME WAS DUE TO AN UNFORESEEABLE ACT OF GOD AND WHOLLY WITHOUT FAULT OR NEGLIGENCE ON YOUR PART OR ON THE PART OF YOUR SUBCONTRACTOR. EXPRESSLY STIPULATED THAT TIME OF DELIVERY WAS OF THE ESSENCE OF THE CONTRACT. IF HIGHER THAN THAT AT WHICH AWARD UNDER THE INVITATION WOULD HAVE BEEN MADE IF TIME OF DELIVERY HAD NOT BEEN A FACTOR. SHALL BE SUCH LOWER PRICE IRRESPECTIVE OF WHETHER OR NOT THE DELAY IS EXCUSABLE UNDER THE ARTICLE OF GENERAL PROVISIONS (STANDARD FORM 32) ENTITLED .

B-126955, MAR. 21, 1956

TO DIAMOND T MOTOR CAR COMPANY:

REFERENCE IS MADE TO YOUR LETTER OF FEBRUARY 8, 1956, WITH ATTACHMENTS, PROTESTING AGAINST THE ASSESSMENT OF LIQUIDATED DAMAGES IN THE AMOUNT OF $1,350.95 BY REASON OF YOUR FAILURE TO MAKE DELIVERY OF A CERTAIN TRUCK UNDER CONTRACT NO. GS-03S-16343 ON OR BEFORE JUNE 15, 1955.

YOU STATE THAT THE DELAY OF ONE DAY IN DELIVERY WAS DUE TO A TORNADO WHICH STRUCK AND DAMAGED THE PLANT OF THE COMPANY WITH WHICH YOU HAD SUBCONTRACTED THE BODY JOB AND THAT YOUR FAILURE TO EFFECT DELIVERY WITHIN THE SPECIFIED TIME WAS DUE TO AN UNFORESEEABLE ACT OF GOD AND WHOLLY WITHOUT FAULT OR NEGLIGENCE ON YOUR PART OR ON THE PART OF YOUR SUBCONTRACTOR.

THE INVITATION FOR BIDS, WHICH CONSTITUTED A PART OF THE CONTRACT, EXPRESSLY STIPULATED THAT TIME OF DELIVERY WAS OF THE ESSENCE OF THE CONTRACT, AND PROVIDED, IN PERTINENT PART, AS FOLLOWS:

"FOR ANY SUPPLIES DELIVERED AFTER THE TIME SPECIFIED BY THE GOVERNMENT AND ACCEPTED, THE PRICE PAYABLE TO THE CONTRACTOR, IF HIGHER THAN THAT AT WHICH AWARD UNDER THE INVITATION WOULD HAVE BEEN MADE IF TIME OF DELIVERY HAD NOT BEEN A FACTOR, SHALL BE SUCH LOWER PRICE IRRESPECTIVE OF WHETHER OR NOT THE DELAY IS EXCUSABLE UNDER THE ARTICLE OF GENERAL PROVISIONS (STANDARD FORM 32) ENTITLED ,DEFAULT.'"

IN YOUR BID SUBMITTED IN RESPONSE TO THE INVITATION YOU EXPRESSLY AGREED TO EFFECT DELIVERY WITHIN 30 DAYS AFTER NOTICE OF AWARD. NOTICE OF AWARD WAS SENT TO YOU BY TELEGRAM DATED MAY 16, 1955, IN WHICH YOU WERE ADVISED THAT ACCEPTANCE WAS MADE "ON BASIS OF DELIVERY OVER TWO OTHER BIDDERS.' THE PURCHASE ORDER ISSUED PURSUANT TO THE CONTRACT ALSO CONTAINED THE FOLLOWING PROVISIONS:

"AWARD WAS MADE TO OTHER THAN THE LOWEST ACCEPTABLE BIDDER AS TO PRICE TO SECURE EARLIER DELIVERY. FOR ANY SUPPLIES DELIVERED AFTER 6/15/55 THE PRICE PAYABLE TO THE CONTRACTOR FOR EACH ITEM SHALL BE THE PRICE QUOTED BY THE LOWEST ACCEPTABLE BIDDER.'

IT WAS THUS YOUR CLEAR AND UNEQUIVOCAL OBLIGATION, IN THE EVENT OF FAILURE TO MAKE DELIVERY BY JUNE 15, 1955, REGARDLESS OF CAUSE OR FAULT, TO ACCEPT THE PRICE QUOTED BY THE NEXT LOWEST ACCEPTABLE BIDDER. DELIVERY ON OR BEFORE JUNE 15, 1955, HAD NOT BEEN URGENTLY NEEDED AND, THEREFORE, THE CONTROLLING FACTOR, THE NET BID OF $3,860.05 SUBMITTED BY INTERNATIONAL HARVESTER COMPANY, OFFERING DELIVERY "30-45 DAYS," WOULD HAVE BEEN ACCEPTED. YOUR HIGHER BID WAS ACCEPTED SOLELY BY REASON OF YOUR OFFER TO EFFECT DELIVERY WITHIN 30 DAYS AFTER NOTICE OF AWARD.

IT IS WELL SETTLED THAT WHERE A CONTRACT CONTAINS AN EXPRESS PROVISION AS TO THE BASIS ON WHICH PAYMENT SHALL BE MADE, SUCH PROVISION IS CONCLUSIVE ON THE PARTIES AND MEASURES THE AMOUNT OF RECOVERY FOR PERFORMANCES. SEE C.J. 585, AND THE NUMEROUS COURT CASES THERE CITED. IT IS ALSO WELL SETTLED THAT NO AGENT OR OFFICER OF THE GOVERNMENT HAS THE AUTHORITY TO MODIFY THE TERMS OF A CONTRACT WHICH HAS BEEN FULLY PERFORMED, OR TO GIVE AWAY OR SURRENDER THE BENEFITS ACCRUING TO THE GOVERNMENT UNDER A VALID CONTRACT TO THE PREJUDICE OF THE INTERESTS OF THE UNITED STATES. SEE PACIFIC HARDWARE AND STEEL COMPANY V. UNITED STATES, 49 C.CLS. 327; BAUSH AND LOMB OPTICAL COMPANY V. UNITED STATES, 78 C.CLS. 584, 607. THE FACT THAT UNFORSEEN DIFFICULTIES ARE ENCOUNTERED WHICH RENDER PERFORMANCE OF A CONTRACT MORE BURDENSOME OR LESS PROFITABLE THAN CONTEMPLATED, OR EVEN OCCASION PECUNIARY LOSS, WILL NEITHER EXCUSE A PARTY FROM THE PERFORMANCE OF AN ABSOLUTE AND UNQUALIFIED UNDERTAKING TO DO A THING THAT IS POSSIBLE AND LAWFUL, NOR ENTITLE HIM TO ADDITIONAL COMPENSATION, UNLESS SPECIFICALLY PROVIDED IN THE CONTRACT. COLUMBUS RAILWAY, POWER AND LIGHT COMPANY V. COLUMBUS, 249 U.S. 399; BLAUNER CONSTRUCTION COMPANY V. UNITED STATES, 94 C.CLS. 503.

ACCORDINGLY, UNDER THE TERMS OF THE CONTRACT YOU WERE ENTITLED, UPON DELIVERY AFTER JUNE 15, 1955, TO BE PAID ONLY THE AMOUNT OF $3,860.05. THEREFORE CONCLUDE THAT YOU ARE LEGALLY LIABLE FOR REFUND OF THE EXCESS AMOUNT OF $1,350.95 INADVERTENTLY PAID, AND WE FIND NO LEGAL BASIS IN THE PRESENT RECORD FOR AUTHORIZING ANY RELIEF FROM SUCH LIABILITY.