B-138101, FEB. 24, 1960

B-138101: Feb 24, 1960

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INC.: REFERENCE IS MADE TO AN UNDATED LETTER RECEIVED FROM YOUR ATTORNEY. WHEREIN IT WAS HELD THAT YOU WERE CHARGEABLE WITH THE EXCESS COSTS INCURRED BY THE UNITED STATES IN CONNECTION WITH THE AIR SHIPMENT OF A REPLACEMENT TENT TO RANGOON. THE FACTS AND CIRCUMSTANCES INVOLVED IN THIS CASE HAVE BEEN SET OUT IN OUR PRIOR DECISION AND WILL NOT BE RESTATED HERE. IN THE REQUEST FOR RECONSIDERATION IT IS STATED THAT YOU SHOULD NOT BE CHARGED FOR COSTS OF TRANSPORTATION OF A REPLACEMENT TENT FROM RALEIGH. IS TRUE THAT UPON THE SHIPMENT OF THE FIRST TENT TO RANGOON THE GOVERNMENT BORE THE COST OF THE FREIGHT CHARGES FROM YOUR PLANT TO DESTINATION. SINCE YOU WERE FOUND TO BE AT FAULT IN THE DESTRUCTION OF THE FIRST TENT BECAUSE YOUR FIELD ENGINEER EXERCISED POOR JUDGMENT IN ATTEMPTING ERECTION OF THE TENT BY NOT ALLOWING SUFFICIENT TIME FOR NORMAL TENT ERECTION BEFORE THE MONSOON STARTED.

B-138101, FEB. 24, 1960

TO GEODESICS, INC.:

REFERENCE IS MADE TO AN UNDATED LETTER RECEIVED FROM YOUR ATTORNEY, MR. JOHN J. SPRIGGS, JR., ON JUNE 24, 1959, REQUESTING RECONSIDERATION OF OUR DECISION OF JANUARY 30, 1959, WHEREIN IT WAS HELD THAT YOU WERE CHARGEABLE WITH THE EXCESS COSTS INCURRED BY THE UNITED STATES IN CONNECTION WITH THE AIR SHIPMENT OF A REPLACEMENT TENT TO RANGOON, BURMA, UNDER CONTRACT NO. IA-3191, DATED JANUARY 3, 1957.

THE FACTS AND CIRCUMSTANCES INVOLVED IN THIS CASE HAVE BEEN SET OUT IN OUR PRIOR DECISION AND WILL NOT BE RESTATED HERE.

IN THE REQUEST FOR RECONSIDERATION IT IS STATED THAT YOU SHOULD NOT BE CHARGED FOR COSTS OF TRANSPORTATION OF A REPLACEMENT TENT FROM RALEIGH, NORTH CAROLINA, TO RANGOON, BURMA, BECAUSE THE CONTRACT EXPRESSLY LIMITED THE POINT OF DELIVERY TO THE AGENCY, F.O.B. RALEIGH, NORTH CAROLINA. IS TRUE THAT UPON THE SHIPMENT OF THE FIRST TENT TO RANGOON THE GOVERNMENT BORE THE COST OF THE FREIGHT CHARGES FROM YOUR PLANT TO DESTINATION. HOWEVER, SINCE YOU WERE FOUND TO BE AT FAULT IN THE DESTRUCTION OF THE FIRST TENT BECAUSE YOUR FIELD ENGINEER EXERCISED POOR JUDGMENT IN ATTEMPTING ERECTION OF THE TENT BY NOT ALLOWING SUFFICIENT TIME FOR NORMAL TENT ERECTION BEFORE THE MONSOON STARTED, THE MATTER IS NOT MERELY ONE OF YOUR LIABILITY AS SUCH FOR TRANSPORTATION BUT IT IS RATHER ONE OF REIMBURSING THE UNITED STATES FOR THE ADDITIONAL EXPENSES IT INCURRED BECAUSE THE FIRST TENT WAS NOT PROPERLY ERECTED.

THE SECOND POINT PRESENTED IN THE REQUEST FOR RECONSIDERATION IS THAT THE CONTRACT DID NOT REQUIRE OR AUTHORIZE YOU TO FURNISH A REPLACEMENT TENT. IT IS A MATTER OF COMMON LAW THAT WHEN YOU BREACHED THE CONTRACT BY FAILING TO PROVIDE COMPETENT SUPERVISION IN ERECTION OF THE FIRST TENT, YOU WOULD HAVE BEEN LIABLE FOR THE EXCESS COSTS INCURRED BY THE UNITED STATES IN GETTING THE WORK PERFORMED BY SOMEBODY ELSE. THEREFORE, IF YOU HAD NOT FURNISHED A REPLACEMENT TENT AND DELIVERED IT TO DESTINATION, THE GOVERNMENT COULD HAVE CHARGED YOU WITH ANY COSTS IT WOULD HAVE INCURRED IN GETTING A REPLACEMENT TENT TO RANGOON. AS TO THE CONTENTION THAT CLAIMS FOR DAMAGES ARE NOT DISPUTES, WHICH UNDER THE TERMS OF THE CONTRACT WERE REQUIRED TO BE SUBMITTED TO A CONTRACTING OFFICER FOR DECISION, THE QUESTION OF WHETHER THERE HAS BEEN A BREACH OF A CONTRACT GENERALLY IS A QUESTION OF FACT AND AS SUCH THE COURTS HAVE UPHELD AS VALID, CONTRACT STIPULATIONS PROVIDING THAT SUCH QUESTIONS ARE TO BE DECIDED BY DESIGNATED PARTIES. EVEN IF THE DECISION OF THE ADMINISTRATIVE OFFICE, AS REFERRED TO IN PAGES 2 AND 3 OF OUR DECISION OF JANUARY 30, 1959, IS NOT TO BE ACCEPTED AS FINAL AND CONCLUSIVE WITH REGARD TO THE QUESTION OF WHETHER YOU WERE NEGLIGENT IN THE ERECTION OF THE FIRST TENT AT RANGOON, OUR OFFICE HAS CONSISTENTLY HELD THAT WHERE THERE IS A DISPUTE AS TO THE FACTS IN A PARTICULAR CASE, WE ACCEPT THE ADMINISTRATIVE VERSION OF THE FACTS IN THE ABSENCE OF CONVINCING EVIDENCE THAT THE REPORT OF THE ADMINISTRATIVE OFFICE IS ERRONEOUS.

WHILE IT IS ONE OF YOUR CONTENTIONS THAT UNDER ARTICLE X OF THE CONTRACT TITLE TO THE TENT PASSED TO THE UNITED STATES UPON INSPECTION OF THE TENT AT YOUR FACTORY, YOUR ATTENTION IS INVITED TO ARTICLE III OF THE CONTRACT WHICH PROVIDES THAT UPON FINAL ACCEPTANCE BY THE AGENCY OF EACH DOME, AND "ON THE BASIS OF SATISFACTORY ERECTION OF SAME OVERSEAS" YOU WERE ENTITLED TO FINAL PAYMENT. ALSO, UNDER ARTICLE I-5 OF THE CONTRACT, YOU WERE REQUIRED TO PROVIDE THE SERVICES OF A COMPETENT TECHNICAL REPRESENTATIVE TO PROVIDE TECHNICAL SUPERVISION FOR THE ERECTION OF THE DOME STRUCTURE. ARTICLE VII OF THE CONTRACT PROVIDED THAT ALL COMPONENTS COMPRISING THE FRAME STRUCTURE OF THE DOME WERE GUARANTEED, AND THAT THE TENT WAS WARRANTED AGAINST ABNORMAL FABRIC AND COATING DETERIORATION FOR A PERIOD OF THREE CALENDAR YEARS. THE WARRANTY CANNOT IN ANY WAY BE CONSIDERED AS LIMITING YOUR RESPONSIBILITY FOR SATISFACTORY PERFORMANCE IN THE FABRICATION AND ERECTION OF THE DOME STRUCTURE.

IT IS CONTENDED THAT THE AGENCY WAS IN FULL CHARGE OF ERECTING THE DOME STRUCTURE BUT IT WOULD APPEAR--- AND IT IS SO REPORTED--- THAT YOUR TECHNICAL CONSULTANT WAS CHARGED BY THE VERY NATURE OF HIS EXPERT KNOWLEDGE AS TO WHEN IT WOULD BE PROPER TO COMMENCE THE ERECTION OF THE TENT. THE FACT THAT THE MONSOONS APPEAR WITH FAIRLY DEFINITE REGULARITY COULD HARDLY CLASS THEM AS ACTS OF GOD IN A LEGAL SENSE AND AS BEING UNFORESEEABLE, AND, THEREFORE, ACTS OF GOD. WHILE IT MAY BE THAT THE DAMAGED TENT HAD BEEN INSPECTED AT YOUR PLANT, THE FACT REMAINS THAT THE TENT WAS DAMAGED BY RAINS AND SUCH DAMAGE IS NOT SHOWN TO HAVE RESULTED FROM NEGLIGENT ACTS OF GOVERNMENT OFFICIALS OR FROM ACTS OF GOD. IT MUST, THEREFORE, BE CONCLUDED THAT THE DAMAGE WAS THE RESULT EITHER OF DEFECTS IN MANUFACTURE OR NEGLIGENCE IN ERECTION OF THE TENT AND IN EITHER EVENT YOU ARE CHARGEABLE WITH THE RESULTANT DAMAGES. SUCH DAMAGES MAY PROPERLY BE MEASURED BY THE COST OF REPLACEMENT, AS WAS DONE HERE.

ACCORDINGLY, SINCE NOTHING HAS BEEN FURNISHED WHICH WOULD WARRANT ANY CHANGE IN THE CONCLUSION HERETOFORE REACHED IN THE MATTER, THE DECISION OF JANUARY 30, 1959, IS AFFIRMED AND YOUR CLAIM FOR COSTS OF THE REPLACEMENT TENT FURNISHED BY YOU, AND NOW ASSERTED IN THE UNDATED LETTER FROM YOUR ATTORNEY AND RECEIVED HERE ON JUNE 24, 1959, MUST BE DISALLOWED.