B-130722, APR. 4, 1957

B-130722: Apr 4, 1957

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TO HERMAN FOX PAPER COMPANY: REFERENCE IS MADE TO YOUR LETTER OF JANUARY 11. REPRESENTING ADDITIONAL FREIGHT CHARGES OF $434.45 ALLEGED BY YOU TO HAVE BEEN INCURRED IN PERFORMING THE CONTRACT. ALTERNATE OFFERS WILL BE CONSIDERED BEST DELIVERY OFFERED MAY BE OF ESSENCE. POINT WAS MENTIONED IN YOUR QUOTATION. WAS ACCEPTED BY YOU AND THAT SUCH PURCHASE ORDER INDICATED THAT THE ITEMS WERE TO BE DELIVERED TO THE TRANSPORTATION OFFICER. THAT SUCH ORDER CONTAINED THE STATEMENT: "YOU ARE RECEIVING AWARD FOR ABOVE ITEMS AS OTHER THAN LOW BID ON BASIS OF DELIVERY. YOU WERE PAID ONLY THE AMOUNT OF THE LOW BID IN ACCORDANCE WITH THE TERMS OF THE CONTRACT. YOU ADVISED THE FEDERAL SUPPLY SERVICE AS FOLLOWS: "WE ARE IN RECEIPT OF YOUR CHECK IN THE AMOUNT OF $3751.65 TENDERED IN PAYMENT OF MERCHANDISE WE DELIVERED AGAINST THE ABOVE CAPTIONED.

B-130722, APR. 4, 1957

TO HERMAN FOX PAPER COMPANY:

REFERENCE IS MADE TO YOUR LETTER OF JANUARY 11, 1957, REQUESTING REVIEW OF THAT PART OF SETTLEMENT DATED JANUARY 3, 1957, WHICH DISALLOWED YOUR CLAIM FOR $548.06, REPRESENTING THE AMOUNT DEDUCTED ($113.61) IN MAKING PAYMENT FOR CERTAIN PAPER SUPPLIES FURNISHED UNDER GENERAL SERVICES ADMINISTRATION CONTRACT NO. GS-08S-9269, DATED JUNE 12, 1956, AND REPRESENTING ADDITIONAL FREIGHT CHARGES OF $434.45 ALLEGED BY YOU TO HAVE BEEN INCURRED IN PERFORMING THE CONTRACT.

ON MAY 31, 1956, THE GENERAL SERVICES ADMINISTRATION, FEDERAL SUPPLY SERVICE, DENVER, COLORADO, SENT YOU THE FOLLOWING TELEGRAM:

"TELEGRAPHIC OR WRITTEN OFFERS INVITED SUBJECT PROVISIONS STANDARD FORMS 32 AND 33 RECEIVED UNTIL 10:00 AM MST 6-7-56 BUSINESS SERVICE CENTER DENVER FEDERAL CENTER DENVER 2 COLORADO.

"ITEM 1 PAPER BOND NO. 1 SULPHITE WATERMARKED SUB 20 WHITE SIZE

22 BY 34 (BIDDER STATE BRAND OFFERED) 20 REAMS.

"ITEM 2 PAPER BOND SPEC UU-P-121F 25 PERCENT RAG SUB 20 SIZE

22 BY 34 INCHES 6 REAMS.

"ITEM 3 PAPER INDEX UU-P-258C SIZE 25 1/2 BY 30 1/2 60000 SHEETS

WHITE SUB 110 AND 5000 SHEETS BUFF SUB 170.

"ITEM 4 PAPER LEDGER UU-P-288B SULPHITE 6000 SHEETS SUB 28 BUFF

SIZE 17 BY 28 IN. 4000 SHEETS SUB 28 WHITE SIZE 17 BY 28 IN.

6000 SHEETS SUB 32 WHITE SIZE 17 BY 28 IN. 4000 SHEETS SUB

36 WHITE SIZE 22 BY 34 IN. AND 4000 SHEETS SUB 36 GREEN SIZE

22 1/2 BY 34 1/2 SOFTONE.

"ITEM 5 PAPER TAG MANILA UU-B-613A SUB 125 SIZE 24 BY 36 IN. 5000

SHEETS ALL FOB OGDEN GENERAL DEPOT OGDEN UTAH.

"IN EVENT NO OFFERS RECEIVED ACCORDING TO SPEC. ALTERNATE OFFERS WILL BE CONSIDERED BEST DELIVERY OFFERED MAY BE OF ESSENCE. REFER QP 218.

C M ARNETT GSA DENVER COLO"

IN RESPONSE TO THE TELEGRAM YOU ADVISED THE PURCHASING OFFICER BY LETTER DATED JUNE 4, 1956, THAT YOU WOULD FURNISH THE PAPER ITEMS DESCRIBED UNDER ITEMS 1 TO 4, INCLUSIVE, OF THE TELEGRAM, AT THE PRICES SET FORTH IN YOUR LETTER; THAT YOU HAD THE REQUIRED PAPER ITEMS ON HAND AND THAT DELIVERY OF THESE ITEMS WOULD BE ACCOMPLISHED WITHIN FOURTEEN DAYS FROM DATE OF RECEIPT OF THE ORDER. NO F.O.B. POINT WAS MENTIONED IN YOUR QUOTATION. BY TELEGRAM DATED JUNE 12, 1956, THE PURCHASING OFFICER ADVISED YOU AS FOLLOWS: "REQUOTE QP-218 YOU AWARDED ALL ITEMS. ORDER 56DE-14001 AND SHIPPING INFORMATION FOLLOWS.'

THE RECORD SHOWS THAT A COPY OF PURCHASE ORDER NO. 56DE-14001, DATED JUNE 14, 1956, CONFIRMING THE TELEGRAPHIC AWARD OF JUNE 12, 1956, WAS ACCEPTED BY YOU AND THAT SUCH PURCHASE ORDER INDICATED THAT THE ITEMS WERE TO BE DELIVERED TO THE TRANSPORTATION OFFICER, UTAH GENERAL DEPOT, OGDEN, UTAH, AND THAT SUCH ORDER CONTAINED THE STATEMENT:

"YOU ARE RECEIVING AWARD FOR ABOVE ITEMS AS OTHER THAN LOW BID ON BASIS OF DELIVERY. FOR ALL ITEMS DELIVERED AFTER 7/5/56 THE PRICE PAYABLE SHOULD BE THE PRICE QUOTED BY THE LOWEST ACCEPTABLE BIDDER.'

IT ALSO SHOWS THAT YOU SIGNED STANDARD FORM 33 (INVITATION, BID AND AWARD) AND THAT SUCH FORM CONTAINED THE SAME INFORMATION AS TO THE DELIVERY DATE AND THE AMOUNT TO BE PAID TO YOU IF YOU FAILED TO DELIVER THE ITEMS BY THE SPECIFIED DATE.

AFTER DELIVERY OF THE PAPER ITEMS, YOU SUBMITTED AN INVOICE FOR PAYMENT AND SINCE YOU DID NOT MAKE DELIVERY AT DESTINATION UNTIL JULY 16, 1956, OR AT A DATE LATER THAN THAT SPECIFIED IN THE CONTRACT, YOU WERE PAID ONLY THE AMOUNT OF THE LOW BID IN ACCORDANCE WITH THE TERMS OF THE CONTRACT.

BY LETTER DATED OCTOBER 22, 1956, YOU ADVISED THE FEDERAL SUPPLY SERVICE AS FOLLOWS:

"WE ARE IN RECEIPT OF YOUR CHECK IN THE AMOUNT OF $3751.65 TENDERED IN PAYMENT OF MERCHANDISE WE DELIVERED AGAINST THE ABOVE CAPTIONED.

"WE FIND THAT YOU ARE CHARGING US WITH $113.61 FOR LATE DELIVERY.

"PLEASE BE ADVISED THAT WE TAKE EXCEPTION TO THIS DEDUCTION ON THE FOLLOWING GROUNDS:

"WHEN WE QUOTED ON YOUR ORIGINAL INVITATION COVERING THE ABOVE PURCHASE ORDER, WE ASSUMED FROM THE FORMAT OF THE WIRE THAT DELIVERY OF FIRST FOUR ITEMS, WERE INTENDED FOR DENVER, COLO. AND THE FIFTH ITEM ONLY INTENDED FOR OGDEN, UTAH. ITEMS WERE LISTED NUMERICALLY, PARAGRAPHED AND THE DESTINATION OF OGDEN FOLLOWED ONLY AFTER ITEM 5, AND WAS NOT PARAGRAPHED TO INDICATE THAT THESE INSTRUCTIONS WERE INTENDED FOR THE ENTIRE INVITATION.

"IN VIEW OF THIS, WE BASED OUR QUOTATION ON DELIVERY TO DENVER AND UPON RECEIPT OF YOUR TELEGRAM JUNE 12, 1956 ADVISING THAT WE WERE AWARDED THE ITEMS WE HAD QUOTED ON, WE PROMPTLY RELEASED THE MERCHANDISE FOR IMMEDIATE SHIPMENT TO DENVER, COLO.

"WHEN WE RECEIVED YOUR CONTRACT, WE NOTED THAT THE DESTINATION WAS OGDEN, UTAH. THIS NECESSITATED RE-ROUTING OF THE SHIPMENT WHICH HAD ALREADY DEPARTED AND CAUSED THE DALAY OF SEVEN DAYS FOR WHICH YOU ARE PENALIZING US.

"IN VIEW OF THE FACT THAT THE ENTIRE MISUNDERSTANDING WAS CAUSED BY IMPROPER TELEGRAPHIC SENDING FROM YOUR OFFICE, WE FEEL THAT WE SHOULD NOT HAVE YOU CHARGE US FOR $113.61, ALSO WE SHOULD BE REIMBURSED FOR FREIGHT DIFFERENTIAL BETWEEN DELIVERY TO DENVER, COLO AND OGDEN, UTAH ON THIS SHIPMENT.

"WE ARE ENCLOSING HEREWITH OUR INVOICES COVERING OUR CLAIMS.'

YOUR INVOICE COVERING THE ALLEGED FREIGHT DIFFERENTIAL BETWEEN DELIVERY BETWEEN DENVER, COLORADO, AND OGDEN, UTAH, WAS IN THE AMOUNT OF $434.45.

IN YOUR LETTER REQUESTING REVIEW YOU CONTEND THAT THE "PENALTY" OF $113.61 FOR "LATE" DELIVERY IS CERTAINLY NOT ALLOWABLE FOR TWO REASONS, NAMELY, (1) THAT YOU FIND NOTHING IN YOUR CONTRACT TO INDICATE THAT THERE IS ANY PENALTY FOR LATE DELIVERY, AND (2) THAT THE SLIGHT DELAY IN DELIVERY WAS NO FAULT OF YOURS BUT THE FAULT OF THE OFFICE ISSUING THE TELEGRAPHIC INVITATION. YOU STATE THAT YOU DID NOT KNOW THAT THE SHIPMENT WAS TO BE CONSIGNED TO OGDEN, UTAH, UNTIL AFTER SHIPMENT WAS MADE BY YOU TO DENVER, COLORADO, AND THAT IT TOOK A FEW DAYS TO RE-ROUTE THE SHIPMENT EN ROUTE TO DENVER, COLORADO, WHICH, YOU STATE, WAS ALL THE DELAY THERE WAS, AND NOT A DELAY IN SHIPPING.

IT IS ESTABLISHED THAT THE SOLE BASIS FOR AWARDING THE CONTRACT TO YOU WAS THE FACT THAT YOU OFFERED DELIVERY WITHIN A SHORTER PERIOD THAN THAT OFFERED BY THE LOW BIDDER. YOU BREACHED YOUR CONTRACT BY FAILING TO MAKE DELIVERY WITHIN THE TIME SPECIFIED IN YOUR ACCEPTED BID. THUS, YOU DID NOT EARN THE INCREASED PRICE AND IT IS OBVIOUS THAT THE GOVERNMENT DID NOT OBTAIN THAT FOR WHICH IT AGREED TO PAY THE ADDITIONAL PRICE OF $113.61. THE CONTRACTING OFFICER WAS NOT AUTHORIZED TO OBLIGATE THE GOVERNMENT TO PAY MORE THAN THE AMOUNT OF THE LOWEST BID FOR THE PAPER, EXCEPT ON CONDITION THAT IT BE DELIVERED BY JULY 5, 1956. THE PRESENT CASE APPEARS TO BE SIMILAR TO THAT CONSIDERED IN 10 COMP. GEN. 191, WHICH INVOLVED A CONTRACT PROVISION SIMILAR TO THE ONE HERE INVOLVED AND WHEREIN IT WAS HELD, QUOTING FROM THE SYLLABUS, THAT---

"WHERE A CONTRACT WITH A HIGHER BIDDER IS BASED UPON A GUARANTEE THAT DELIVERY WILL BE MADE WITHIN A CERTAIN SPECIFIED PERIOD AND THAT IN EVENT DELIVERY IS NOT SO MADE, AN AMOUNT EQUAL TO THAT QUOTED BY THE LOWEST BIDDER ONLY WOULD BE PAID, THE CONTRACTOR IS NOT ENTITLED TO ANY AMOUNT IN EXCESS OF THAT QUOTED BY THE LOWEST BIDDER WHEN THERE IS FAILURE TO MAKE DELIVERY WITHIN THE GUARANTEED PERIOD.'

SEE ALSO 17 COMP. GEN. 619.

IN REGARD TO YOUR CLAIM FOR REIMBURSEMENT OF THE FREIGHT DIFFERENTIAL BETWEEN DENVER, COLORADO, AND OGDEN, UTAH, THE TELEGRAPHIC INVITATION SPECIFICALLY STATED AFTER THE DESCRIPTION OF ITEMS 1 TO 5, INCLUSIVE, "ALL FOB OGDEN GENERAL DEPOT OGDEN UTAH" AND GAVE NO INDICATION THAT DELIVERY WAS DESIRED AT ANY OTHER POINT. IRRESPECTIVE OF THE PARAGRAPHING OF THE MESSAGE, THE INCLUSION OF THIS STATEMENT "ALL FOB OGDEN GENERAL DEPOT OGDEN UTAH," AND THE OMISSION OF ANY OTHER F.O.B. POINT IN THE MESSAGE LEFT NO LOGICAL BASIS FOR THE ASSUMPTION THAT ITEMS 1 TO 4, INCLUSIVE, WERE INTENDED FOR DELIVERY TO DENVER, COLORADO. ALSO, YOUR LETTER QUOTATION DID NOT INDICATE ANY F.O.B. POINT AND, IN THE ABSENCE OF ANY STATEMENT, THE CONTRACTING OFFICER HAD A RIGHT TO ASSUME THAT YOU INTENDED TO DELIVER THE PAPER F.O.B. OGDEN, UTAH--- THE ONLY F.O.B. POINT MENTIONED IN THE TELEGRAPHIC INVITATION.

IN THE NOTICE OF AWARD DATED JUNE 12, 1956, YOU WERE ADVISED THAT THE ORDER AND SHIPPING INFORMATION WOULD FOLLOW THE TRANSMISSION OF THE NOTICE OF AWARD. IN YOUR LETTER QUOTATION YOU SPECIFIED THAT DELIVERY OF THE PAPER WOULD BE ACCOMPLISHED WITHIN FOURTEEN DAYS AFTER RECEIPT OF THE ORDER. IT APPEARS THAT INSTEAD OF AWAITING THE RECEIPT OF THE SHIPPING INFORMATION, WHICH WAS SHOWN IN THE ORDER AND WHICH INDICATED THE F.O.B. POINT AS OGDEN, UTAH, YOU IMMEDIATELY, UPON RECEIPT OF THE NOTICE OF AWARD, STARTED THE SHIPMENT FOR DENVER, COLORADO, THE POINT WHICH YOU ERRONEOUSLY ASSUMED WAS THE F.O.B. POINT. SINCE YOU CONDITIONED THE DELIVERY PERIOD UPON RECEIPT OF THE ORDER, ANY ACTION TAKEN BY YOU PRIOR TO THE RECEIPT OF SUCH ORDER WAS AT YOUR OWN RISK. THE RESPONSIBILITY FOR THE PREPARATION OF A BID SUBMITTED IN RESPONSE TO AN INVITATION IS UPON THE BIDDER. SEE FRAZIER-DAVIS CONSTRUCTION COMPANY V. UNITED STATES, 100 C.CLS. 120, 163. ANY ERROR THAT WAS MADE IN YOUR BID WAS UNILATERAL--- NOT MUTUAL -- AND, THEREFORE DOES NOT ENTITLE YOU TO RELIEF. SEE OGDEN AND DOUGHERTY V. UNITED STATES, 102 C.CLS. 249; SALIGMAN ET AL. V. UNITED STATES, 56 F.SUPP. 505; 20 COMP. GEN. 652; AND 26 ID. 415.

THE GOVERNMENT HAS RECEIVED IN THE PRESENT CASE ONLY THAT WHICH THE CONTRACT PROVIDED IT SHOULD RECEIVE AND, HAVING PAID THE AGREED PRICE THEREFOR, THERE IS NO LEGAL BASIS FOR THE ALLOWANCE OF AN AMOUNT IN ADDITION THERETO. ACCORDINGLY, THE SETTLEMENT DISALLOWING YOUR CLAIM FOR $548.06 IS SUSTAINED.

THE INVOICES SUBMITTED BY YOUR MR. HERMAN FOX, AT A CONFERENCE HELD IN OUR OFFICE ON MARCH 27, 1957, ARE RETURNED AS REQUESTED BY HIM.