B-130918, MAY 2, 1957

B-130918: May 2, 1957

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INC.: REFERENCE IS MADE TO YOUR LETTER DATED JANUARY 31. REPRESENTING DEMURRAGE CHARGES ON A SHIPMENT OF SISAL WHICH WERE DISALLOWED BY SETTLEMENT DATED DECEMBER 20. WAS FORWARDED TO THIS OFFICE WITH A LETTER OF NOVEMBER 5. THAT SHIPMENT WAS MADE BY YOUR VESSEL. PAYMENT OF THE INVOICES COVERING DEMURRAGE WAS DISALLOWED BY THE GENERAL SERVICES ADMINISTRATION DUE TO FAILURE OF THE CONTRACTOR. THE RECORD SHOWS THAT YOU WERE ADVISED BY LETTER OF MAY 27. ONLY SIX DAYS' ADVANCE NOTICE WAS RECEIVED AND THAT. THE GOVERNMENT WAS ENTITLED TO AN EXTENSION OF FOUR DAYS BEYOND THE EXPIRATION OF THE FREE TIME. THE DATE ON WHICH THE MATERIAL WAS REMOVED FROM THE PIER. YOUR CLAIM WAS DISALLOWED BY THIS OFFICE AND YOU WERE ADVISED THAT UNDER THE TERMS OF THE CONTRACT THE SHIPPER.

B-130918, MAY 2, 1957

TO SEAS SHIPPING COMPANY, INC.:

REFERENCE IS MADE TO YOUR LETTER DATED JANUARY 31, 1957, WITH ENCLOSURE, REQUESTING FURTHER CONSIDERATION OF YOUR CLAIM FOR $123.25 AND $29, REPRESENTING DEMURRAGE CHARGES ON A SHIPMENT OF SISAL WHICH WERE DISALLOWED BY SETTLEMENT DATED DECEMBER 20, 1956, CLAIM NO. Z 459/14).

THE CLAIM, ADMINISTRATIVELY DISALLOWED, WAS FORWARDED TO THIS OFFICE WITH A LETTER OF NOVEMBER 5, 1956, FROM THE GENERAL SERVICES ADMINISTRATION. THE RECORD SHOWS THAT THE GENERAL SERVICES ADMINISTRATION PURCHASED 420 BALES OF RUBBER FROM JAMES FYFE AND COMPANY UNDER CONTRACT NO. GS-OOP- 7030/SCM), AND THAT SHIPMENT WAS MADE BY YOUR VESSEL, THE S. S. LOCKSLEY. BY LETTER DATED FEBRUARY 24, 1954, JAMES FYFE AND COMPANY TRANSMITTED TO THE GENERAL SERVICES ADMINISTRATION DEMURRAGE BILLS FROM THE ROBIN LINE TO COVER DEMURRAGE FOR THE PERIOD FEBRUARY 20 TO FEBRUARY 24, 1954. PAYMENT OF THE INVOICES COVERING DEMURRAGE WAS DISALLOWED BY THE GENERAL SERVICES ADMINISTRATION DUE TO FAILURE OF THE CONTRACTOR, JAMES FYFE AND COMPANY, TO COMPLY WITH ARTICLE 12 OF THE CONTRACT, ENTITLED NOTICE OF SHIPMENT, WHICH READS:

"A. TO AVOID WHARF DEMURRAGE AND/OR STORAGE CHARGES, AND IN ORDER THAT INSPECTION AND REMOVAL OF THE FIBER MAY BE COMPLETED BY THE GOVERNMENT WITHIN THE FREE TIME ALLOWED, THE CONTRACTOR SHALL FURNISH THE GOVERNMENT WITH AN ARRIVAL NOTICE, NOT LESS THAN 10 DAYS IN ADVANCE OF THE SCHEDULED ARRIVAL, LISTING THEREIN THE CONTRACT NUMBER, NAME OF STEAMER, PORT OF ARRIVAL, GRADES, AND MARKS, AND SUCH OTHER INFORMATION AS MAY BE PERTINENT.'

IN THIS CONNECTION, THE RECORD SHOWS THAT YOU WERE ADVISED BY LETTER OF MAY 27, 1955, FROM THE GENERAL SERVICES ADMINISTRATION, THAT WHILE THE CONTRACT PROVIDED FOR 10 DAYS' ADVANCE NOTICE OF THE VESSEL'S ARRIVAL, ONLY SIX DAYS' ADVANCE NOTICE WAS RECEIVED AND THAT, IN ACCORDANCE WITH OUR DECISION OF DECEMBER 14, 1953, B-117643 (COPY ENCLOSED), THE GOVERNMENT WAS ENTITLED TO AN EXTENSION OF FOUR DAYS BEYOND THE EXPIRATION OF THE FREE TIME, OR UNTIL FEBRUARY 23, 1954, THE DATE ON WHICH THE MATERIAL WAS REMOVED FROM THE PIER.

BY CERTIFICATE OF SETTLEMENT (CLAIM NO. Z-459 (14) (, DATED DECEMBER 20, 1956, YOUR CLAIM WAS DISALLOWED BY THIS OFFICE AND YOU WERE ADVISED THAT UNDER THE TERMS OF THE CONTRACT THE SHIPPER, JAMES FYFE AND COMPANY, WAS LIABLE FOR ALL TRANSPORTATION CHARGES INVOLVED, SINCE DELIVERY WAS TO BE MADE FREE OF EXPENSE TO THE GOVERNMENT.

THE CONTRACT PROVISION REQUIRING THE CONTRACTOR, JAMES FYFE AND COMPANY, TO FURNISH THE GOVERNMENT NOTICE AT LEAST 10 DAYS IN ADVANCE OF THE SCHEDULED ARRIVAL IN ORDER TO AVOID WHARF DEMURRAGE OR STORAGE CHARGES, AND IN ORDER THAT INSPECTION AND REMOVAL OF THE FIBER COULD BE COMPLETED BY THE GOVERNMENT WITHIN THE FREE TIME ALLOWED, WAS CLEAR AND UNAMBIGUOUS. FURTHERMORE, THE FAILURE TO FURNISH SUCH NOTICE PROVED PREJUDICIAL TO THE INTEREST OF THE GOVERNMENT IN THAT THE GOVERNMENT WAS DEPRIVED OF FOUR OF THE DAYS' NOTICE TO WHICH IT WAS ENTITLED UNDER THE CONTRACT. AS WAS STATED IN B-117643, SUPRA, IT REPEATEDLY HAS BEEN HELD THAT WHERE A CONTRACTUAL RIGHT IS CONDITIONED UPON COMPLIANCE WITH A PROCEDURE MUTUALLY AGREED UPON AND REQUIRED BY THE APPLICABLE CONTRACT, FAILURE TO COMPLY WITH THE PRESCRIBED PROCEDURE PRECLUDES ENJOYMENT OF THAT RIGHT. SEE THE COURT CASES CITED AT 24 COMP. GEN. 565, 572, PARTICULARLY UNITED STATES V. CUNNINGHAM, 125 F.2D 28, HOLDING THAT THE GOVERNMENT MAY NOT BE DEPRIVED OF THE BENEFIT OF A CONTRACTUAL SAFEGUARD SUCH AS CONTAINED IN THE 10-DAY WRITTEN NOTICE PROVISION HERE IN QUESTION BECAUSE IT MUST BE ASSUMED THAT THE PARTIES IN INSERTING THE PROVISION ATTACHED BOTH VALUE AND IMPORTANCE TO ITS PRECISE TERMS AND, BEING A CONDITION PRECEDENT, COMPLIANCE THEREWITH MUST BE SHOWN. IN VIEW THEREOF, THE ACTION OF THE GENERAL SERVICES ADMINISTRATION IN THIS CASE IN EXTENDING THE "FREE TIME" OF THE GOVERNMENT BY FOUR DAYS AND DISCLAIMING LIABILITY FOR THE DEMURRAGE CHARGES APPEARS TO HAVE BEEN PROPER, AND A CLAIM FOR DEMURRAGE ON THIS SHIPMENT APPARENTLY WOULD BE FOR PAYMENT BY THE SHIPPER, JAMES FYFE AND COMPANY, RATHER THAN THE GOVERNMENT.

ACCORDINGLY, ON THE BASIS OF THE PRESENT RECORD, THE DISALLOWANCE OF YOUR CLAIM WAS PROPER, AND IS SUSTAINED.