B-129755, JAN. 3, 1957

B-129755: Jan 3, 1957

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TO AMERICAN SURPLUS SALES CO.: REFERENCE IS MADE TO YOUR LETTER OF OCTOBER 22. YOUR BID WAS ACCEPTED AND AWARD MADE TO YOU. YOU WILL ACCEPT $100. THE COST TO YOU TO HAVE THE MATERIAL SORTED SO AS TO BE USEFUL. YOU WILL RETAIN THE MATERIAL. YOU NOW CONTEND THAT DUE TO THE MANNER IN WHICH THE MATERIALS WERE STORED IN A DARK WAREHOUSE AND IN 6-FOOT CRATES WEIGHING MORE THAN 300 POUNDS EACH. YOU WERE UNABLE TO MAKE THE FULL AND COMPLETE INSPECTION PURSUANT TO PARAGRAPH 1 OF THE GENERAL SALE TERMS AND CONDITIONS. YOU FURTHER CONTEND THAT THE MATERIAL IN QUESTION WAS IMPROPERLY ADVERTISED. YOU WERE AWARE OF THE FACT THAT SALVAGE PROPERTY WAS BEING OFFERED FOR SALE AND. IF YOU FELT THAT A MORE DETAILED INSPECTION OF THE GOODS WAS NECESSARY FOR THE PROTECTION OF YOUR INTERESTS.

B-129755, JAN. 3, 1957

TO AMERICAN SURPLUS SALES CO.:

REFERENCE IS MADE TO YOUR LETTER OF OCTOBER 22, 1956, REQUESTING RECONSIDERATION OF SETTLEMENT DATED OCTOBER 16, 1956, WHICH DISALLOWED YOUR CLAIM FOR $171.84, OR ALTERNATE CLAIM FOR $100, ALLEGED TO BE DUE IN CONNECTION WITH SCRAP KAPOK PURCHASED FROM PUGET SOUND NAVAL SHIPYARD, BREMERTON, WASHINGTON, UNDER CONTRACT NO. N251S-8210A, DATED DECEMBER 16, 1955.

IN RESPONSE TO INVITATION NO. B-30-56 DATED NOVEMBER 22, 1955, ISSUED BY THE PUGET SOUND NAVAL SHIPYARD, YOU SUBMITTED YOUR UNDATED BID OFFERING TO PURCHASE, AMONG OTHER ITEMS, ITEM NO. 14 WHICH SPECIFIED 14,000 POUNDS OF SCRAP KAPOK (OLD LIFE JACKETS) AT A UNIT PRICE OF $0.008 PER POUND, OR FOR A TOTAL PRICE OF $112. YOUR BID WAS ACCEPTED AND AWARD MADE TO YOU, THEREBY CONSUMMATING A VALID AND BINDING CONTRACT BETWEEN THE PARTIES. AFTER PAYMENT OF THE PURCHASE PRICE FOR THE ENTIRE QUANTITY OF KAPOK (12,480 POUNDS ONLY) AND DELIVERY OF THE SAME TO YOU, YOU CLAIMED A REFUND OF PART OF THE PURCHASE PRICE.

YOU STATE THAT, ALTHOUGH YOU MADE A PARTIAL INSPECTION OF THE MERCHANDISE BEFORE BIDDING, NEVERTHELESS AFTER REMOVAL OF THE SCRAP KAPOK AND REINSPECTING IT YOU FOUND A QUANTITY OF SPUN GLASS MIXED WITH THE MATERIAL AND, THEREFORE, SEEK REFUND OF THE ENTIRE PURCHASE PRICE ($99.84) PLUS ONE -HALF OF THE HANDLING CHARGES ($72), OR A TOTAL OF $171.84, WITH THE PROVISO THAT THE AGENCY MIGHT PICK UP THE MATERIAL; OR, AS AN ALTERNATIVE, YOU WILL ACCEPT $100, THE COST TO YOU TO HAVE THE MATERIAL SORTED SO AS TO BE USEFUL, AND YOU WILL RETAIN THE MATERIAL.

YOU NOW CONTEND THAT DUE TO THE MANNER IN WHICH THE MATERIALS WERE STORED IN A DARK WAREHOUSE AND IN 6-FOOT CRATES WEIGHING MORE THAN 300 POUNDS EACH, STACKED 3 FEET HIGH, YOU WERE UNABLE TO MAKE THE FULL AND COMPLETE INSPECTION PURSUANT TO PARAGRAPH 1 OF THE GENERAL SALE TERMS AND CONDITIONS. YOU FURTHER CONTEND THAT THE MATERIAL IN QUESTION WAS IMPROPERLY ADVERTISED.

WITH REGARD TO YOUR FIRST CONTENTION, EVEN ASSUMING IT TO BE A FACT THAT CIRCUMSTANCES DID NOT PERMIT YOU TO THOROUGHLY INSPECT THE ENTIRE LOT OF KAPOK OFFERED FOR SALE, NO LEGAL RESPONSIBILITY WOULD ATTACH TO THE GOVERNMENT AS A RESULT THEREOF IN THE ABSENCE OF A SHOWING OF BAD FAITH ON THE PART OF THE DISPOSAL OFFICER OR HIS AGENTS. YOU WERE AWARE OF THE FACT THAT SALVAGE PROPERTY WAS BEING OFFERED FOR SALE AND, IF YOU FELT THAT A MORE DETAILED INSPECTION OF THE GOODS WAS NECESSARY FOR THE PROTECTION OF YOUR INTERESTS, AND YOU WERE NOT WILLING TO ASSUME THE RISKS IMPOSED BY THE CONTRACT TERMS YOU SHOULD NOT HAVE SUBMITTED A BID.

WITH REGARD TO YOUR SECOND CONTENTION, THE CONTRACTING OFFICER HAS REPORTED THAT HE WAS UNAWARE WHEN THE MATERIAL WAS LOTTED FOR SALE THAT IT CONTAINED ANY LIFE JACKETS FILLED WITH SPUN GLASS; THAT UPON RECEIPT OF YOUR CLAIM FOR REFUND, TWO TECHNICIANS FROM THE SHIPYARD WERE SENT TO YOUR WAREHOUSE TO INSPECT THE KAPOK AND DETERMINE THE APPROXIMATE PERCENTAGE OF ALLEGED CONTAMINATION; AND THAT THEY ESTIMATED THAT THE CONTAMINATION DID NOT EXCEED 5 PERCENT AND COULD BE PURIFIED "IN ONE MAN DAY" OF LABOR.

WITH FURTHER REGARD TO YOUR SECOND CONTENTION, PARAGRAPH 2 OF THE GENERAL SALE TERMS AND CONDITIONS PROVIDES AS FOLLOWS:

"CONDITION OF PROPERTY.--- ALL PROPERTY LISTED HEREIN IS OFFERED FOR SALE "AS IS" AND "WHERE IS" AND WITHOUT RECOURSE AGAINST THE GOVERNMENT. IF IT IS PROVIDED HEREIN THAT THE GOVERNMENT SHALL LOAD, THEN "WHERE IS" MEANS F.O.B. CONVEYANCE AT THE POINT SPECIFIED IN THE INVITATION. THE DESCRIPTION IS BASED ON THE BEST AVAILABLE INFORMATION, BUT THE GOVERNMENT MAKES NO GUARANTY, WARRANTY, OR REPRESENTATION, EXPRESSED OR IMPLIED, AS TO QUANTITY, KIND, CHARACTER, QUALITY, WEIGHT, SIZE, OR DESCRIPTION OF ANY OF THE PROPERTY, OR ITS FITNESS FOR ANY USE OR PURPOSE, AND NO CLAIM WILL BE CONSIDERED FOR ALLOWANCE OR ADJUSTMENT OR FOR RESCISSION OF THE SALES BASED UPON FAILURE OF THE PROPERTY TO CORRESPOND WITH THE STANDARD EXPECTED; THIS IS NOT A SALE BY SAMPLE.'

SUCH LANGUAGE WHICH SPECIFICALLY PROVIDES THAT NO WARRANTIES OR GUARANTIES ARE MADE BY THE GOVERNMENT, CONSTITUTES AN EXPRESS DISCLAIMER OF WARRANTY. WHILE 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 AS IN THIS CASE, NO SUCH WARRANTY MAY BE IMPLIED FROM THE DESCRIPTION OF THE PROPERTY SOLD AS THE DISCLAIMER OF WARRANTY 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; AND I. SHAPIRO AND COMPANY V. UNITED STATES, 66 C.CLS. 424.

UNDER THE CIRCUMSTANCES AND SINCE THE ADMINISTRATIVE AGENCY OF THE GOVERNMENT IS SHOWN TO HAVE ACTED IN GOOD FAITH IN THE MATTER BY DESCRIBING THE PROPERTY ON THE BASIS OF THE BEST INFORMATION AVAILABLE AND FOR WHAT IT WAS BELIEVED TO BE, THERE IS NO LEGAL BASIS ON WHICH YOUR CLAIM FOR REIMBURSEMENT PROPERLY MAY BE ALLOWED. ACCORDINGLY, THE SETTLEMENT OF OCTOBER 16, 1956, IS SUSTAINED.