B-129921, JAN. 8, 1957

B-129921, JAN. 8, 1957

TO MIDWEST WASTE MATERIAL COMPANY:

REFERENCE IS MADE TO YOUR LETTER DATED NOVEMBER 6, 1956, REQUESTING REVIEW OF SETTLEMENT DATED OCTOBER 18, 1956, WHICH DISALLOWED YOUR CLAIM FOR $3,705.16, ALLEGED TO BE DUE AS A PARTIAL REFUND OF THE AMOUNT PAID FOR OVERCOATS PURCHASED FROM THE GOVERNMENT ON SPOT BID SALE NO. 12-036-3- 56-55, AT THE JEFFERSONVILLE QUARTERMASTER DEPOT, JEFFERSONVILLE, INDIANA.

THE INVITATION DESCRIBED THE 7140 OVERCOATS OFFERED FOR SALE AS WOOL, ASSORTED TYPES AND SIZES (USED). YOU CONTEND THAT WHEN THE OVERCOATS WERE RECEIVED YOU FOUND THAT 756 WERE MUTILATED, RIPPED, TORN AND MOTH-DAMAGED; THAT 23 MACKINAWS WERE RECEIVED; AND THAT 620 OVERCOATS WERE BEYOND REPAIR OR SALVAGE. MUCH EMPHASIS IS PLACED ON THE ALLEGATION THAT YOU WERE DENIED THE OPPORTUNITY TO THOROUGHLY INSPECT THE ENTIRE LOT OF OVERCOATS. WHILE SUCH CONTENTION IS NOT SUPPORTED BY THE ADMINISTRATIVE REPORT, EVEN ASSUMING THE SAME TO BE A FACT, 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 YOUR BID. THERE IS NOTHING IN THE RECORD TO ESTABLISH THAT THE CONTRACTING OFFICER OR HIS AGENTS ACTED OTHER THAN IN GOOD FAITH THROUGHOUT THE TRANSACTION. IN THIS REGARD IT IS NOTED THAT IN YOUR LETTER OF MARCH 9, 1956, TO THE JEFFERSONVILLE QUARTERMASTER DEPOT YOU STATED THAT IN YOUR INSPECTION PRIOR TO THE SALE "BALES WERE TAKEN FROM ALL PARTS OF THE PILE OF BALES, TOP AND BOTTOM FRONT AND BACK, AND BALES WERE OPENED AND A DETAILED PIECE BY PIECE INSPECTION WAS MADE.' THIS FACT INDICATES THAT THERE WAS NO ATTEMPT ON THE PART OF THE DISPOSAL OFFICER TO MISLEAD YOU IN THE MATTER.

THE GENERAL SALE TERMS AND CONDITIONS PROVIDED THAT THE MATERIAL WAS OFFERED "AS IS" AND "WHERE IS," WITHOUT RECOURSE AGAINST THE GOVERNMENT, AND THAT--- QUOTING FROM PARAGRAPH 2---

"* * * 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 SALE BASED UPON FAILURE OF THE PROPERTY TO CORRESPOND WITH THE STANDARD EXPECTED; THIS IS NOT A SALE BY SAMPLE.'

IT IS DIFFICULT TO PERCEIVE HOW CLEARER OR MORE EXPLICIT LANGUAGE COULD HAVE BEEN USED TO APPRISE ALL PROSPECTIVE BIDDERS THAT THEY WERE CONTRACTING FOR THE PURCHASE OF THE LISTED MATERIALS AT THEIR OWN RISK. THE COURTS HAVE HELD REPEATEDLY THAT SUCH PROVISIONS CONSTITUTE AN EXPRESS DISCLAIMER OF WARRANTY. LUMBRAZO V. WOODRUFF, 175 N.E. 525; W. E. HEDGER COMPANY V. UNITED STATES, 52 F.2D 31, CERTIORARI DENIED, 284 U.S. 676. THOSE CASES, AND NUMEROUS OTHER CASES, CONCLUDE THAT UNDER SUCH CIRCUMSTANCES BUYERS HAVE NO RIGHT TO EXPECT, HAVE NOTICE NOT TO EXPECT, AND CONTRACT NOT TO EXPECT, ANY WARRANTIES WHATEVER. IN DISPOSING OF SURPLUS MATERIALS THE GOVERNMENT IS NOT ENGAGED IN NORMAL TRADE AND FREQUENTLY IS IGNORANT OF THE CONDITION OF THE GOODS IT SELLS. THAT FACT IS MADE KNOWN TO ALL BIDDERS BY THE "AS IS" TERMS OF THE CONTRACT WHEREBY THE PARTIES AGREE THAT THE RISK AS TO THE CONDITION OF THE MATERIAL SOLD IS ASSUMED BY THE PURCHASER AS ONE OF THE ELEMENTS OF THE BARGAIN.