B-127274, MAY 1, 1956

B-127274: May 1, 1956

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

B-127274, MAY 1, 1956

TO MR. PHIL HENRY:

FURTHER REFERENCE IS MADE TO YOUR LETTER OF MARCH 9, 1956, REQUESTING AN ADJUSTMENT ON YOUR PURCHASE OF A LATHE LISTED AS ITEM 19 IN SALES INVITATION AEC-SS-118 ISSUED BY THE ATOMIC ENERGY COMMISSION AT RICHLAND, WASHINGTON.

BY THE INVITATION REFERRED TO, DATED NOVEMBER 7, 1955, THE HANFORD OPERATIONS OFFICE, RICHLAND, WASHINGTON, REQUESTED BIDS FOR THE SALE OF MISCELLANEOUS SURPLUS PROPERTY. IN RESPONSE TO THE INVITATION, YOU SUBMITTED A BID OFFERING TO PURCHASE, AMONG OTHERS, ITEM 19,"LATHE, HENDRI, WITH 12 INCH BY 30 INCH BED W/3 H.P. MOTOR, RPM-1160/970," FOR $448. THE BID WAS ACCEPTED, THE PRICE PAID, AND THE PROPERTY DELIVERED TO YOU. THEREAFTER, BY LETTER DATED JANUARY 11, 1956, YOU ACKNOWLEDGED RECEIPT OF THE LATHE, BUT ALLEGED THAT IT WAS FOUND NOT TO BE ACCORDING TO THE DESCRIPTION IN THE INVITATION IN THAT THE ONLY PART OF THE LATHE DELIVERED WAS THE BED, AND THAT THE MOTOR WAS A 1 1/2 HP RATHER THAN A 3 HP MOTOR. BY LETTER DATED FEBRUARY 9, 1956, THE CONTRACTING OFFICER INFORMED YOU THAT THE ITEM SHIPPED WAS THE ITEM ON WHICH INSPECTION WAS INVITED AND THAT THE GENERAL SALE TERMS OF THE CONTRACT WERE BINDING. YOUR LETTER OF MARCH 9, 1956, YOU REQUESTED AN ADJUSTMENT IN THE PRICE FOR ITEM 19 AND POINTED OUT THAT, SINCE THE TOTAL OF THE ELEVEN OTHER BIDS RECEIVED WAS LESS THAN THE PRICE YOU PAID FOR THE ITEM, A MISTAKE WAS EVIDENT. THE CONTRACTING OFFICER REPORTS THAT AT THE TIME OF THE BID OPENING HE DID NOT, AND HAD NO REASON TO, SUSPECT AN ERROR IN YOUR BID, NOR WAS HE AWARE OF THE INADEQUATE DESCRIPTION OF THE PROPERTY. ALTHOUGH THE BID WAS HIGHER THAN THE ELEVEN OTHER BIDS ON ITEM 19, WHICH RANGED FROM $137.50 TO $5.11, SUCH DIFFERENCE WOULD NOT NECESSARILY INDICATE AN ERROR SINCE A WIDE RANGE IN THE PRICES BID ON USED PROPERTY IS NOT UNUSUAL.

ORDINARILY, IN THE SALE OF PERSONAL PROPERTY BY DESCRIPTION, THERE IS AN IMPLIED WARRANTY THAT THE PROPERTY WILL CORRESPOND WITH THE DESCRIPTION. WHERE THERE IS AN EXPRESS DISCLAIMER OF WARRANTY, HOWEVER, NO SUCH WARRANTY MAY BE IMPLIED FROM THE DESCRIPTION OF THE PROPERTY SOLD, AS THE DISCLAIMER EXTENDS TO AND INCLUDES THE DESCRIPTION. SEE LUMBRAZO V. WOODRUFF, 175 N.E. 525; W.E. HEDGER COMPANY V. UNITED STATES, 52 F.2D 31, CERTIORARI DENIED 284 U.S. 676; TRIAD CORPORATION V. UNITED STATES, 63 C.CLS. 151; AND I. SHAPIRO AND COMPANY V. UNITED STATES, 66 C.CLS. 424. IN THE PRESENT CASE, PARAGRAPHS 1 AND 2 OF THE GENERAL SALE TERMS AND CONDITIONS URGED PROSPECTIVE BIDDERS TO INSPECT THE PROPERTY PRIOR TO SUBMITTING BIDS AND, WHILE STATING THAT THE DESCRIPTION WAS BASED ON THE BEST AVAILABLE INFORMATION, ADVISED PROSPECTIVE BIDDERS THAT THE PROPERTY WAS OFFERED FOR SALE "AS IS" AND "WHERE IS; " THAT THE GOVERNMENT MADE NO GUARANTY, WARRANTY, OR REPRESENTATION AS TO QUALITY OR DESCRIPTION OF THE PROPERTY OR AS TO ITS FITNESS FOR ANY USE OR PURPOSE, AND THAT "NO CLAIM WILL BE CONSIDERED FOR ALLOWANCE OR ADJUSTMENT OR FOR RESCISSION OF THE SALE BASED UPON FAILURE OF THE PROPERTY TO CORRESPOND WITH THE STANDARD EXPECTED.' THUS, WHILE THE GOVERNMENT'S DESCRIPTION OF THE PROPERTY MAY HAVE BEEN INACCURATE, THERE IS NO INDICATION THAT IT WAS NOT PREPARED IN GOOD FAITH, AND THE DISCLAIMER WAS SPECIFIC AS TO THE DESCRIPTION OF THE PROPERTY.

IT APPEAR THAT NO INSPECTION OF THE PROPERTY WAS MADE BY YOU PRIOR TO SUBMISSION OF YOUR BID, AND IN YOUR LETTER OF MARCH 9, 1956, YOU STATE "THAT TO HAVE INSPECTED THIS MACHINE PRIOR TO BID WOULD HAVE BEEN ALMOST AS BAD A SHOCK AS IT HAS BEEN" AND YOU INQUIRE AS TO WHAT RECOURSE YOU WOULD HAVE IF YOU MADE A 700 MILE TRIP, INVOLVING AT LEAST TWO DAYS' TIME, FOR INSPECTION ONLY TO FIND THE ADVERTISED ITEM WORTHLESS. IN THIS CONNECTION THE EXPRESS TERMS OF THE INVITATION CONSTITUTED ADEQUATE WARNING THAT ANY BID MADE WITHOUT INSPECTION WOULD BE STRICTLY AT THE BIDDER'S RISK. NO ONE WAS UNDER ANY OBLIGATION EITHER TO INSPECT THE PROPERTY OR TO SUBMIT A BID, AND THE DECISION OF ANY INDIVIDUAL EITHER TO INSPECT OR TO BID WAS NECESSARILY ONE TO BE MADE SOLELY BY HIM. THE LAW IS CLEAR THAT WHERE PROPERTY OF THE CHARACTER HERE INVOLVED IS OFFERED FOR SALE BY THE GOVERNMENT ON AN "AS IS" BASIS WITHOUT WARRANTY OR GUARANTY OF ANY KIND, A BIDDER WHO FAILS TO TAKE ADVANTAGE OF THE OPPORTUNITY TO INSPECT CANNOT SUBSEQUENTLY RECOVER ON THE GROUND THAT THE QUALITY OF THE PROPERTY IS INFERIOR TO THAT EXPECTED. SEE 30 COMP. GEN. 188, AND COURT CASES CITED IN THAT DECISION. THE LAW HAS BEEN SETTLED BY THE COURTS, AND WE HAVE NO CHOICE BUT TO FOLLOW IT.

ACCORDINGLY, WE FIND NO LEGAL BASIS FOR AUTHORIZING ANY ADJUSTMENT IN THE PRICE FIXED IN THE CONTRACT FOR THE MATERIAL INVOLVED.