B-130756, APR. 8, 1957

B-130756: Apr 8, 1957

Additional Materials:

Contact:

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

 

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

TO RAYTHEON MANUFACTURING COMPANY: FURTHER REFERENCE IS MADE TO YOUR LETTER OF JANUARY 29. WHEREIN THERE WAS DISALLOWED A CLAIM FOR $160. 494 THAT WAS FILED BY YOU ON BEHALF OF THE STROMBERG- CARLSON COMPANY UNDER CONTRACT NO. IT APPEARS THAT A PRIMARY PART OF THIS TECHNICAL EQUIPMENT WAS IDENTIFIED AS AN ID-260-GRD AZIMUTH INDICATOR AND THIS INDICATOR IN TURN WAS COMPOSED OF A MAJOR COMPONENT PART KNOWN AS A CIRCUITROL. APPARENTLY WERE EXPERIENCED BY THE STROMBERG-CARLSON COMPANY IN THE USE OF THIS PARTICULAR MAKE OF CIRCUITROL AND AS A RESULT OF SUCH DIFFICULTIES. THE COMPANY IS ALLEGED TO HAVE INCURRED EXCESSIVE COSTS IN ITS EFFORT TO PRODUCE ACCEPTABLE AZIMUTH INDICATORS FOR THE RADIO DIRECTION FINDERS.

B-130756, APR. 8, 1957

TO RAYTHEON MANUFACTURING COMPANY:

FURTHER REFERENCE IS MADE TO YOUR LETTER OF JANUARY 29, 1957, REQUESTING REVIEW OF SETTLEMENT DATED MAY 31, 1956, WHEREIN THERE WAS DISALLOWED A CLAIM FOR $160,494 THAT WAS FILED BY YOU ON BEHALF OF THE STROMBERG- CARLSON COMPANY UNDER CONTRACT NO. AF 33/038/-30605 DATED JULY 24, 1952, WITH THE DEPARTMENT OF THE AIR FORCE.

UNDER THE CONTRACT YOU AGREED TO FURNISH TO THE DEPARTMENT OF THE AIR FORCE, IN ACCORDANCE WITH APPLICABLE PLANS AND SPECIFICATIONS, CERTAIN QUANTITIES OF RADIO DIRECTION FINDERS--- DESIGNATED AS EQUIPMENT AN/CRD-6, GRA-9--- TOGETHER WITH SPARE COMPONENTS, SPARE PARTS, AND DATA FOR AN ORIGINAL PRICE OF $4,494,492.27. IT APPEARS THAT A PRIMARY PART OF THIS TECHNICAL EQUIPMENT WAS IDENTIFIED AS AN ID-260-GRD AZIMUTH INDICATOR AND THIS INDICATOR IN TURN WAS COMPOSED OF A MAJOR COMPONENT PART KNOWN AS A CIRCUITROL, OR A PHASE MEASURING DEVICE. IT APPEARS FURTHER THAT YOUR SUBCONTRACTOR, THE STROMBERG CARLSON COMPANY, USED A KOLLSMAN INSTRUMENT CORPORATION CIRCUITROL IN CONNECTION WITH THE PRODUCTION OF THE AZIMUTH INDICATORS. CERTAIN DIFFICULTIES WITH RESPECT TO ACCURACY REQUIREMENTS, ETC., APPARENTLY WERE EXPERIENCED BY THE STROMBERG-CARLSON COMPANY IN THE USE OF THIS PARTICULAR MAKE OF CIRCUITROL AND AS A RESULT OF SUCH DIFFICULTIES, THE COMPANY IS ALLEGED TO HAVE INCURRED EXCESSIVE COSTS IN ITS EFFORT TO PRODUCE ACCEPTABLE AZIMUTH INDICATORS FOR THE RADIO DIRECTION FINDERS. DELIVERY OF THE BASIC EQUIPMENT TO THE DEPARTMENT OF THE AIR FORCE WAS EFFECTED ONLY AFTER THE STROMBERG-CARLSON COMPANY INCURRED THE EXCESSIVE COSTS AND AFTER CERTAIN PARTS OF THE SPECIFICATIONS PERTAINING TO THE AZIMUTH INDICATOR WERE RELAXED BY THE DEPARTMENT OF THE AIR FORCE. AS A RESULT OF THIS, YOU NOW CLAIM, ON BEHALF OF THE STROMBERG -CARLSON COMPANY, THE AMOUNT OF $160,494 TO COVER THE EXCESSIVE COSTS ALLEGEDLY INCURRED BY THAT COMPANY AS A SUBCONTRACTOR UNDER THE SUBJECT CONTRACT.

IT APPEARS FROM YOUR LETTER OF JANUARY 29, 1957, THAT YOUR REQUEST FOR REVIEW PRIMARILY IS BASED UPON THE CONTENTIONS THAT ENGINEERING CHANGE PROPOSAL NO. 17, ISSUED TO CONTRACT NO. AF 33/038/-30605, HAS NO BEARING ON THE CLAIM AS IT AFFECTS THE STROMBERG-CARLSON COMPANY AND THAT THE KOLLSMAN INSTRUMENT CORPORATION'S CIRCUITROLS WERE REPRESENTED BY THE DEPARTMENT OF THE AIR FORCE TO BOTH YOU AND THE STROMBERG-CARLSON COMPANY AS BEING SUITABLE FOR THEIR INTENDED USE AND WOULD MEET THE AIR FORCE REQUIREMENTS. ALSO, IN YOUR LETTER DATED AUGUST 9, 1954, TO WHICH YOU REFER, THERE IS SET FORTH IN CONSIDERABLE DETAIL REFERENCE TO VARIOUS CORRESPONDENCE AND CONFERENCES HAD BY YOU WITH REPRESENTATIVES OF THE ROME AIR FORCE DEPOT REGARDING INSPECTION, REJECTION, REWORKING, ETC., OF THE KOLLSMAN CIRCUITROLS AND THE CONSTANT DIFFICULTIES EXPERIENCED IN THE USE OF THIS COMPONENT AS WELL AS THE PROBLEMS ENCOUNTERED IN CONNECTION WITH THE REQUESTS FOR ADJUSTMENTS IN THE ACCURACY REQUIREMENTS OF THE AZIMUTH INDICATOR. ALSO, YOU TAKE THE POSITION IN YOUR LETTER OF AUGUST 9, 1954, THAT THE ENGINEERING CHANGE WHICH WAS FINALLY MADE AND WHICH RELAXED TO SOME EXTENT THE ACCURACY REQUIREMENTS OF THE EQUIPMENT EVIDENCES THE REQUIREMENT FOR MODIFICATION OF THE ORIGINAL SPECIFICATIONS BY REASON OF THE INACCURACY OF THE INFORMATION PRESENTED TO YOU IN CONNECTION WITH THE PHASE METER UNIT.

WITH RESPECT TO THE CONTENTIONS UPON WHICH IT APPEARS YOU ARE RELYING MOST STRONGLY, YOU ARE ADVISED THAT THE RECORD BEFORE OUR OFFICE FAILS TO ESTABLISH THAT THE DEPARTMENT OF THE AIR FORCE REPRESENTED TO EITHER YOU OR THE STROMBERG-CARLSON COMPANY THAT THE CIRCUITROL OF THE KOLLSMAN INSTRUMENT CORPORATION WAS SUITABLE FOR ITS INTENDED USE AND WOULD MEET THE AIR FORCE REQUIREMENTS. IN THIS CONNECTION, IT IS REPORTED THAT FROM THE INCEPTION OF CONTRACT NO. AF 33/038/-30605, YOU WERE INFORMED THAT YOU WERE NOT OBLIGATED TO USE THE CIRCUITROL, OR PHASE MEASURING DEVICE, OF THE KOLLSMAN INSTRUMENT CORPORATION BUT COULD PROCURE THIS PARTICULAR COMPONENT PART FROM OTHER SOURCES. HENCE, IN THE FIRST INSTANCE, WE ARE CONFRONTED WITH CERTAIN INCONSISTENT STATEMENTS WITH RESPECT TO THIS PARTICULAR ISSUE AND WHEN SUCH A COMPLETE DISAGREEMENT EXISTS BETWEEN THE FACTS AS ADMINISTRATIVELY REPORTED AND THOSE STATED BY A CLAIMANT, THERE IS FOR APPLICATION THE PRINCIPLE THAT THE FACTS AS ADMINISTRATIVELY REPORTED MUST, UNDER SUCH CIRCUMSTANCES, BE ACCEPTED BY OUR OFFICE AS CONTROLLING THE DISPOSITION OF THE CLAIM IN THE ABSENCE OF EVIDENCE TO OVERCOME THE CORRECTNESS OF SUCH REPORTED FACTS.

HOWEVER, FOR THE SOLE PURPOSE OF A FURTHER DISCUSSION OF THE MERITS OF THE CLAIM, LET US ASSUME THAT RESPONSIBLE OFFICIALS OF THE DEPARTMENT OF THE AIR FORCE HAD EXPRESSED THE BELIEF THAT THE KOLLSMAN CIRCUITROL, OR ONE OF EQUAL PERFORMANCE QUALITIES, WOULD MEET THE REQUIREMENTS OF THE SPECIFICATIONS. IN THE ABSENCE OF SOME PARTICULARLY UNIQUE CIRCUMSTANCES, SUCH ORAL OPINIONS COULD HARDLY BE ACCEPTED AS ALTERING YOUR LEGAL RESPONSIBILITY UNDER THE EXPRESS TERMS OF THE WRITTEN CONTRACT. IN THIS CONNECTION, THERE CANNOT BE CONTESTED THE FACT THAT UNDER THE CONTRACT YOU FULLY AGREED TO ASSUME ALL RESPONSIBILITY FOR FURNISHING THE RADIO DIRECTION FINDERS, SPARE COMPONENTS, SPARE PARTS AND DATA THAT WOULD COMPLY STRICTLY WITH THE DETAILED REQUIREMENTS OF THE SPECIFICATIONS. THE DEPARTMENT OF THE AIR FORCE OWED NO DUTY IN THIS RESPECT UNDER THE TERMS OF THE CONTRACT NOR DOES IT APPEAR THAT IT WAS PARTICULARLY CONCERNED AS TO THE TYPE OF COMPONENT PARTS USED. THE INTEREST OF THE AIR FORCE IN THE MATTER WAS ONLY IN THE END PRODUCT, NAMELY TO INSURE ITS RECEIPT OF EQUIPMENT THAT COMPLIED STRICTLY WITH THE DETAILED REQUIREMENTS OF THE SPECIFICATIONS. THAT THE VARIOUS COMPONENT PARTS--- PRIMARILY THE CIRCUITROLS--- AVAILABLE FOR USE BY YOU OR THE STROMBERG-CARLSON COMPANY WERE NOT LIMITED TO ANY SPECIFIC TYPE APPEARS TO BE FULLY SUPPORTED BY THE DEPARTMENT OF THE AIR FORCE REPORT THAT THE JOHN OSTER COMPANY PROPOSED TO MANUFACTURE A CIRCUITROL WHICH THE COMPANY WOULD GUARANTEE WOULD COMPLY WITH THE SPECIFICATIONS. THIS BEING THE CASE, IT ONLY REASONABLY MAY BE CONCLUDED THAT THE DECISION OF EITHER YOU OR THE STROMBERG-CARLSON COMPANY TO CONTINUE TO USE THE KOLLSMAN INSTRUMENT CORPORATION'S CIRCUITROL FOLLOWING THE PROBLEMS THAT AROSE WAS YOUR OWN CHOICE.

MOREOVER, IT WOULD APPEAR THAT LITTLE, IF ANY, MERIT MAY BE GIVEN TO YOUR CONTENTION THAT THE DEPARTMENT OF THE AIR FORCE ENGINEERING CHANGE WHICH FINALLY GAVE AN INSUFFICIENT INCREASE AND OVER-ALL TOLERANCE OF THE ID 260/GRD AZIMUTH INDICATOR, EVIDENCES THE REQUIREMENT FOR MODIFICATION OF THE ORIGINAL SPECIFICATIONS BY REASON OF THE INACCURACY OF THE INFORMATION PRESENTED TO YOU AND IS CLEARLY INDICATIVE OF A NEED FOR SUCH ACTION TO HAVE BEEN TAKEN AT THE TIME THE PROBLEM AROSE. IN THIS CONNECTION, THE AIR FORCE REPORTS THAT ITS REFUSAL TO RELAX THE OVER-ALL SPREAD IN THE EQUIPMENT TO 5 DEGREES AT AN EARLIER DATE WAS MOTIVATED BY A NUMBER OF FACTORS, THE MORE IMPORTANT OF WHICH WERE THAT (1) F.T.L. PRODUCTION ITEMS DEMONSTRATED ERROR SPREADS OF LESS THAN 5 DEGREES; (2) SELECTIVE MANUFACTURE OF THE PHASE MEASURING DEVICE--- COMPONENT OF THE ID/260 GRD-- - COULD HAVE INSURED MEETING THE SPECIFIED SYSTEM ACCURACY; (3) THE JOHN OSTER COMPANY PROPOSED TO MANUFACTURE THE ITEM TO EXISTING SPECIFICATIONS; (4) RELAXATION OF THE SPECIFICATION TO THE EXTENT OF 5 DEGREES COULD ONLY BE GRANTED PROVIDING THE OVER-ALL SYSTEM COULD STILL ACCOMPLISH THE OPERATIONAL FUNCTION FOR WHICH THE EQUIPMENT WAS DESIGNED; AND (5) PERFORMANCE CHARACTERISTICS OF CONTEMPORARY DIRECTION FINDERS WERE WELL WITHIN THE PROPOSED NEW ERROR LIMITS OF THE AN/CRD-6 SYSTEM. IN VIEW OF THIS, IT APPEARS THAT THE DEPARTMENT OF THE AIR FORCE WAS FULLY JUSTIFIED IN TAKING THE POSITION THAT PRODUCTION OF THE END EQUIPMENT WAS NEITHER IMPOSSIBLE NOR IMPRACTICAL WITHIN THE INSTRUMENTAL ACCURACY REQUIREMENTS PREVIOUSLY ESTABLISHED. IN FACT, IT APPEARS REASONABLE TO PRESUME THAT THE ULTIMATE RELAXATION BY THE AIR FORCE OF CERTAIN SPECIFICATION REQUIREMENTS RESULTED IN THE DELIVERY BY YOU OF RADIO DIRECTION FINDERS, SOME COMPONENT PARTS OF WHICH, WERE SOMEWHAT INFERIOR TO THE EQUIPMENT YOU WERE ORIGINALLY OBLIGATED TO FURNISH UNDER THE TERMS OF THE CONTRACT.

A SUMMATION OF THE FOREGOING, THEN WOULD APPEAR TO WARRANT THE DETERMINATION THAT REGARDLESS OF THE EFFECT ON YOUR CLAIM OF ENGINEERING CHANGE PROPOSAL NO. 17, EVEN THOUGH THE PROPOSAL APPEARS DIRECTLY ASSOCIATED WITH YOUR CLAIM AND RESULTED IN AN INCREASE OF $10,832.31 IN THE CONTRACT PRICE, THE ISSUE HERE MUST BE DECIDED ON THE BASIS OF THE SOLE OBLIGATION UNDER THE TERMS OF THE CONTRACT. THAT DETERMINATION HAVING BEEN HERETOFORE RESOLVED, OUR OFFICE IS UNABLE TO FIND ANY LEGAL BASIS FOR THE ALLOWANCE OF ANY PART OF THE AMOUNT CLAIMED.