B-130810, MAY 2, 1957

B-130810: May 2, 1957

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TO EMECO CORPORATION: FURTHER REFERENCE IS MADE TO YOUR LETTER OF FEBRUARY 20. 000 UNITS READY TO SHIP AND ALL THE RAW MATERIAL ON HAND FOR ENTIRE CONTRACT BEFORE TERMINATION WAS GIVEN. "/2) WHY. IT WAS CONSIDERED UNACCEPTABLE. "/3) WHY NAVY EXCEEDED 120 PERCENT IN AWARD OF THIS CONTRACT. "/4) WHY THE NAVY FAILED TO COOPERATE IN HELPING OUR CORPORATION TO BE A RELIABLE SUPPLIER. SINCE WE HAD PROVEN OUR ABILITY TO BE THE LOWEST BIDDER AND THERBY PROVIDED NAVY WITH ANOTHER SOURCE OF SUPPLY AT LOWER PRICES. "/5) DETERMINE WHEN NAVY WILL HAVE DELIVERY FROM JUNIOR TOY CORPORATION. IF SAID DELIVERY SCHEDULED WILL BE ANY BETTER THAN DELIVERY SCHEDULE IN OUR ORIGINAL CONTRACT. "/6) DETERMINE IF THERE EXISTED ANY URGENCY IN THESE ITEMS THAT COULD JUSTIFY TERMINATION.'.

B-130810, MAY 2, 1957

TO EMECO CORPORATION:

FURTHER REFERENCE IS MADE TO YOUR LETTER OF FEBRUARY 20, 1957, WITH RESPECT TO THE TERMINATION BY THE DEPARTMENT OF THE NAVY OF CONTRACT NO. NORD-17048.

YOUR LETTER REQUESTS THAT WE CONDUCT A SURVEY TO DETERMINE THE FOLLOWING:

"/1) WHY NAVY FAILED TO DETERMINE THAT WE HAD 22,000 UNITS READY TO SHIP AND ALL THE RAW MATERIAL ON HAND FOR ENTIRE CONTRACT BEFORE TERMINATION WAS GIVEN.

"/2) WHY, WHEN WE OFFERED TO CONCLUDE THIS CONTRACT TWO WEEKS PRIOR TO ORIGINAL CONTRACT, IT WAS CONSIDERED UNACCEPTABLE.

"/3) WHY NAVY EXCEEDED 120 PERCENT IN AWARD OF THIS CONTRACT.

"/4) WHY THE NAVY FAILED TO COOPERATE IN HELPING OUR CORPORATION TO BE A RELIABLE SUPPLIER, SINCE WE HAD PROVEN OUR ABILITY TO BE THE LOWEST BIDDER AND THERBY PROVIDED NAVY WITH ANOTHER SOURCE OF SUPPLY AT LOWER PRICES.

"/5) DETERMINE WHEN NAVY WILL HAVE DELIVERY FROM JUNIOR TOY CORPORATION, AND IF SAID DELIVERY SCHEDULED WILL BE ANY BETTER THAN DELIVERY SCHEDULE IN OUR ORIGINAL CONTRACT.

"/6) DETERMINE IF THERE EXISTED ANY URGENCY IN THESE ITEMS THAT COULD JUSTIFY TERMINATION.'

YOU FURTHER REQUEST THAT THE NAVY BE REQUIRED TO CANCEL THE CONTRACT WITH JUNIOR TOY CORPORATION IF IT DOES NOT PROVIDE FOR ANY IMPROVEMENT IN DELIVERY SCHEDULE AS COMPARED TO CONTRACT NORD-17048.

WE HAVE BEEN ADVISED BY THE DEPARTMENT OF THE NAVY THAT THE QUESTIONS RAISED IN YOUR LETTER CONSTITUTE OR INVOLVE QUESTIONS OF FACT BEARING ON ISSUES NOW PENDING BEFORE THE ARMED SERVICES BOARD OF CONTRACT APPEALS. AS YOU ARE AWARE, THE "DISPUTES" CLAUSE IN YOUR CONTRACT WITH THE NAVY PROVIDES THAT DETERMINATIONS AS TO QUESTIONS OF FACT BY THE SECRETARY OF THE NAVY OR HIS DULY AUTHORIZED REPRESENTATIVE (THE ARMED SERVICES BOARD OF CONTRACT APPEALS) SHALL BE FINAL AND CONCLUSIVE. IN VIEW OF THE PROVISIONS OF THE "DISPUTES" CLAUSE, THERE APPEARS TO BE NO APPROPRIATE ACTION WHICH OUR OFFICE MAY TAKE AT THIS TIME. YOU MAY, HOWEVER, RESUBMIT THE MATTER UPON AN ULTIMATE DETERMINATION BY THE SECRETARY OR HIS DULY AUTHORIZED REPRESENTATIVE.