B-138501, SEP. 30, 1959

B-138501: Sep 30, 1959

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

B-138501, SEP. 30, 1959

TO MR. CHARLES E. COMPTON:

REFERENCE IS MADE TO YOUR LETTERS OF AUGUST 13 AND 14, 1959, RELATIVE TO YOUR CLAIM FOR $17,156, REPRESENTING THE PRICE PAID FOR ITEM NO. 3 OF CONTRACT NO. (41-612/S-57-35, BEING ONE AIRCRAFT, DOUGLAS, B-26C BOMBER, PURCHASED FROM THE DEPARTMENT OF THE AIR FORCE, SHEPPARD AIR FORCE BASE, WICHITA FALLS, TEXAS. IT IS YOUR CONTENTION, IN SUBSTANCE, THAT THE FACTS AND CIRCUMSTANCES INVOLVED IN YOUR INSTANT CLAIM ARE SIMILAR TO THOSE INVOLVED IN A PRIOR CLAIM COVERING ITEM NO. 2 OF THE SAME CONTRACT, WHICH ALSO WAS A DOUGLAS BOMBER, AND THEREFORE RELIEF IN THIS INSTANCE SHOULD BE GRANTED FOR THE SAME REASONS.

THE RECORD SHOWS THAT PURSUANT TO INVITATION NO. 41-612-S-57-5, YOU SUBMITTED A BID, WITH A BID DEPOSIT OF $9,753.20, WHICH WAS ACCEPTED AS TO ITEMS 2, 3, AND 4, EQUAL TO A TOTAL CONTRACT PRICE OF $48,410 FOR THE THREE AIRCRAFT DESCRIBED THEREIN. SUBSEQUENTLY, THE BALANCE DUE FOR ITEMS 3 AND 4 WAS REMITTED AND DELIVERY OF THE AIRCRAFT ACCEPTED BY YOU PURSUANT TO ORDER DATED JUNE 12, 1957. THEREAFTER, YOU NOTIFIED THE DISPOSAL AGENCY THAT YOU WERE COMPELLED TO ASK FOR RELIEF AS TO ITEM NO. 2, THE REMAINING AIRCRAFT UNDELIVERED, AND REQUESTED THAT THE CASH BID DEPOSIT APPLICABLE THERETO BE REFUNDED. THE MATTER WAS REFERRED TO THIS OFFICE FOR DIRECT SETTLEMENT AS A CLAIM, AND UPON DEVELOPMENT OF THE FACTS AND CIRCUMSTANCES OF THIS TRANSACTION IT WAS CONCLUDED THAT SINCE THE INVITATION CONTAINED A MATERIAL MISDESCRIPTION AS TO THE CONDITION OF THE AIRPLANE, AND SINCE DELIVERY WAS NEVER ACCOMPLISHED, THE SALE THEREOF PROPERLY MIGHT BE VIEWED AS HAVING BEEN RESCINDED. ACCORDINGLY, THAT PART OF YOUR TOTAL DEPOSIT APPLICABLE TO ITEM NO. 2, $4,316.40, PLUS $71.20 DEPOSITED AGAINST ITEM NO. 5 WHICH WAS AWARDED TO ANOTHER BIDDER, WAS AUTHORIZED FOR REFUND.

YOU NOW CONTEND THAT UNDER THE SAME PRINCIPLE REFUND OF THE TOTAL PURCHASE PRICE OF ITEM NO. 3, OR $17,156, SHOULD BE MADE SINCE THAT AIRCRAFT ALSO WAS GROSSLY MISDESCRIBED IN THE INVITATION. THE ACTUAL CONDITION OF THE AIRPLANE AT TIME OF DELIVERY HAS NOT BEEN ASCERTAINED SINCE WE DO NOT FEEL THAT SUCH FACT IS MATERIAL TO THE ISSUE FOR THE FOLLOWING REASONS. AS HERETOFORE STATED, THE FULL PURCHASE PRICE OF THE AIRCRAFT WAS PAID UPON DELIVERY AND ACCEPTANCE THEREOF, AND THEREAFTER THE ARTICLE WAS CONVERTED BY YOU FOR YOUR FUTURE USE AND BENEFIT. IN A SOMEWHAT SIMILAR CASE, ALSO INVOLVING THE SALE OF GOVERNMENT SURPLUS PROPERTY, IT WAS HELD THAT WHILE REJECTION BY THE CONTRACTOR OF THE LAST SHIPMENT OF GOODS AS NONCONFORMING WAS PROPER, THE BUYER LOST THE RIGHT TO RESCIND THE CONTRACT BY ACCEPTANCE OF THE PRIOR SHIPMENTS. SEE AMERICAN ELASTICS V. UNITED STATES, 187 F.2D 109, 114.

ACCORDINGLY, IN VIEW OF THE FACTS OF RECORD AND APPLICABLE LAW THERE IS NO LEGAL BASIS UPON WHICH WE MAY AUTHORIZE RESCISSION OF THE CONTRACT AS TO ITEM NO. 3, OR DIRECT THE REFUND OF ANY PART OF THE PURCHASE PRICE PAID FOR THE AIRCRAFT.