B-135670, MAY 7, 1958

B-135670: May 7, 1958

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TO THE SECRETARY OF AGRICULTURE: FURTHER REFERENCE IS MADE TO A LETTER DATED MARCH 27. THE PIPE WAS DELIVERED TO THE CONSTRUCTION SITE ON AUGUST 30. OR ABOUT 85 DAYS AFTER THE ORDER WAS PLACED. IT IS REPORTED THAT THE USUAL DELIVERY TIME. - IS 30 TO 50 DAYS AND. THE CONTRACTOR WAS FORCED TO CEASE OPERATIONS FROM JULY 15. IT IS REPORTED FURTHER THAT WORK UNDER THE CONTRACT WAS THEREAFTER CLOSED DOWN FOR THE WINTER MONTHS. THAT BY THE TIME THE CONTRACT IS COMPLETED IN THE SPRING IT IS PROBABLE THAT THE ALLOWABLE PERFORMANCE TIME WILL BE EXCEEDED BY 34 DAYS. IT APPEARS THAT REINFORCED 18 INCH CONCRETE PIPE OF THE SPECIFIED TYPE WAS. IT IS REPORTED FURTHER THAT THE TIME REQUIRED FOR DELIVERY OF THIS ORDER WAS NORMALLY FROM 30 TO 50 DAYS.

B-135670, MAY 7, 1958

TO THE SECRETARY OF AGRICULTURE:

FURTHER REFERENCE IS MADE TO A LETTER DATED MARCH 27, 1958, WITH ENCLOSURES, FROM THE ASSISTANT SECRETARY, REQUESTING OUR DECISION AS TO THE PROPRIETY OF ISSUING A CERTAIN PROPOSED MODIFICATION TO SOIL CONSERVATION SERVICE CONTRACT NO. 12-10-150-99, DATED MAY 31, 1957.

UNDER THE CONTRACT BELCHER BROTHERS AND ROBERT CREWS, HEREINAFTER REFERRED TO AS THE CONTRACTOR, AGREED TO FURNISH ALL LABOR, EQUIPMENT AND MATERIALS AND TO PERFORM THE WORK INCIDENT TO THE CONSTRUCTION OF FLOODWATER RETARDING STRUCTURE NO. 3, EARTHFILL EMBANKMENT, ETC., IN THE UPPER GREEN RIVER PILOT WATERSHED, LINCOLN COUNTY, KENTUCKY, FOR A TOTAL CONTRACT PRICE OF $20,711.76. ON JUNE 7, 1957, OR FOUR DAYS AFTER RECEIPT OF NOTICE OF THE ACCEPTANCE OF ITS BID, THE CONTRACTOR PLACED AN ORDER FOR CERTAIN QUANTITIES OF CONCRETE PIPE REQUIRED FOR THE STRUCTURE. THE PIPE WAS DELIVERED TO THE CONSTRUCTION SITE ON AUGUST 30, 1957, OR ABOUT 85 DAYS AFTER THE ORDER WAS PLACED. IT IS REPORTED THAT THE USUAL DELIVERY TIME--- APPARENTLY FOR SUCH CONCRETE PIPE--- IS 30 TO 50 DAYS AND, THEREFORE, DUE TO THE DELAY INVOLVED, THE CONTRACTOR WAS FORCED TO CEASE OPERATIONS FROM JULY 15, 1957, TO AUGUST 27, 1957, OR FOR A PERIOD OF 44 DAYS. IT IS REPORTED FURTHER THAT WORK UNDER THE CONTRACT WAS THEREAFTER CLOSED DOWN FOR THE WINTER MONTHS; THAT THE CONTRACTOR HAS ALREADY EXCEEDED THE ALLOWABLE PERFORMANCE TIME BY 29 DAYS; AND THAT BY THE TIME THE CONTRACT IS COMPLETED IN THE SPRING IT IS PROBABLE THAT THE ALLOWABLE PERFORMANCE TIME WILL BE EXCEEDED BY 34 DAYS, THEREBY SUBJECTING THE CONTRACTOR TO THE ASSESSMENT OF LIQUIDATED DAMAGES AT THE STIPULATED RATE OF $25 A CALENDAR DAY. THE SOIL CONSERVATION SERVICE PROPOSES TO ISSUE, PURSUANT TO SECTION 5 (C) OF CONTRACT NO. 12-10-150-99, MODIFICATION NO. 3, TO GRANT AN EXTENSION OF TIME OF 43 CALENDAR DAYS TO THE PERFORMANCE PERIOD UNDER THE CONTRACT. HOWEVER, SINCE THE SUBJECT OF THE DELAY INVOLVES THE QUESTION OF THE FAILURE OF THE CONTRACTOR'S SUPPLIER TO MAKE TIMELY DELIVERIES, THE MATTER HAS BEEN SUBMITTED TO US FOR A DECISION AS TO THE PROPRIETY OF THE ISSUANCE OF THE MODIFICATION.

SECTION 5 (C) OF CONTRACT NO. 12-10-150-99, PROVIDES, AS FOLLOWS:

"THE RIGHT OF THE CONTRACTOR TO PROCEED SHALL NOT BE TERMINATED, AS PROVIDED IN PARAGRAPH (A) HEREOF, NOR THE CONTRACTOR CHARGED WITH LIQUIDATED OR ACTUAL DAMAGES, AS PROVIDED IN PARAGRAPH (B) HEREOF BECAUSE OF ANY DELAYS IN THE COMPLETION OF THE WORK DUE TO UNFORESEEABLE CAUSES BEYOND THE CONTROL AND WITHOUT THE FAULT OR NEGLIGENCE OF THE CONTRACTOR, INCLUDING, BUT NOT RESTRICTED TO, * * * OR DELAYS OF SUBCONTRACTORS OR SUPPLIERS DUE TO SUCH CAUSES.'

IT APPEARS THAT REINFORCED 18 INCH CONCRETE PIPE OF THE SPECIFIED TYPE WAS, AT THE TIME OF AWARD OF THE CONTRACT, MANUFACTURED ONLY BY THE LOCK- JOINT PIPE COMPANY, FROM WHOM THE CONTRACTOR ORDERED IT, HAVING BEEN DISCONTINUED BY OTHER FIRMS WHICH HAD PREVIOUSLY MADE IT. IT IS REPORTED FURTHER THAT THE TIME REQUIRED FOR DELIVERY OF THIS ORDER WAS NORMALLY FROM 30 TO 50 DAYS, BUT THAT AT THE TIME THE CONTRACTOR'S ORDER WAS RECEIVED IT WAS OUT OF STOCK AND HAD TO BE MADE UP SPECIALLY FOR THIS ORDER.

ON THE BASIS OF THE RECORD NOW BEFORE US, THE CESSATION OF WORK BETWEEN JULY 15 AND AUGUST 27 APPEARS TO HAVE BEEN DIRECTLY ATTRIBUTABLE TO THE DELAY OF THE SUPPLIER IN FURNISHING THE 18 INCH REINFORCED CONCRETE PIPE AND IN THE CIRCUMSTANCES SHOWN WE WILL INTERPOSE NO OBJECTION TO THE EXPANSION PROPOSED BY THE CONTRACTING OFFICER.

A REFERENCE TO THIS DECISION SHOULD BE MADE ON THE MODIFICATION.