B-139595, MAY 28, 1959, 38 COMP. GEN. 803

B-139595: May 28, 1959

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WHICH WERE SERVICES REQUIRED TO BE FURNISHED AS A PART OF THE RENTAL CONSIDERATION. MUST BE REGARDED AS AN OBLIGATION WHICH THE LESSOR WAS REQUIRED TO MAKE UNDER THE LEASE WITHOUT ANY ADDITIONAL CONSIDERATION. ADDITIONAL RENTAL MAY NOT BE PAID THE LESSOR FOR SUCH CHANGES IN THE ABSENCE OF A SHOWING THAT THE OFFICERS IN CHARGE WERE ACTING ON BEHALF OF THE CONTRACTING OFFICER OF THE GENERAL SERVICES ADMINISTRATION AND THE LEASE MAY NOT BE AMENDED TO PROVIDE FOR AN INCREASE IN RENTAL RATE EVEN THOUGH THE GOVERNMENT MAY HAVE BENEFITED FROM THE IMPROVEMENTS. OF YOUR ADMINISTRATION WILL BE CONSIDERED AS A REQUEST FOR A DECISION AS TO WHETHER LEASE NO. IS FOR 2. THE WORK WHICH APPARENTLY HAD BEEN REQUESTED OF THE LESSOR BY THE INTERNAL REVENUE SERVICE APPEARS TO HAVE BEEN NECESSARY DUE TO UNSATISFACTORY AIR-CONDITIONING OPERATION AND HEATING AND SOUND PROBLEMS UNFORESEEN BY THE LESSOR'S ARCHITECT.

B-139595, MAY 28, 1959, 38 COMP. GEN. 803

CONTRACTS - LEASES - INCREASED RENT - ALTERATIONS, ETC. - AUTHORITY OF OFFICERS IN BUILDING LEASED BY GENERAL SERVICES ADMINISTRATION. ALTERATIONS TO AN OFFICE BUILDING LEASED BY THE GOVERNMENT WHICH HAD TO BE MADE BY THE LESSOR BECAUSE OF UNSATISFACTORY AIR-CONDITIONING, HEATING, LIGHTING AND SOUND CONDITIONS, WHICH WERE SERVICES REQUIRED TO BE FURNISHED AS A PART OF THE RENTAL CONSIDERATION, MUST BE REGARDED AS AN OBLIGATION WHICH THE LESSOR WAS REQUIRED TO MAKE UNDER THE LEASE WITHOUT ANY ADDITIONAL CONSIDERATION. NOTWITHSTANDING THAT OFFICERS OF A GOVERNMENT AGENCY OCCUPYING A BUILDING LEASED BY THE GENERAL SERVICES ADMINISTRATION RECOMMENDED CERTAIN ALTERATIONS BECAUSE OF UNSATISFACTORY AIR-CONDITIONING, HEATING, LIGHTING, AND SOUND CONDITIONS, WITH THE UNDERSTANDING THAT AN ADJUSTMENT IN RENT WOULD BE MADE, ADDITIONAL RENTAL MAY NOT BE PAID THE LESSOR FOR SUCH CHANGES IN THE ABSENCE OF A SHOWING THAT THE OFFICERS IN CHARGE WERE ACTING ON BEHALF OF THE CONTRACTING OFFICER OF THE GENERAL SERVICES ADMINISTRATION AND THE LEASE MAY NOT BE AMENDED TO PROVIDE FOR AN INCREASE IN RENTAL RATE EVEN THOUGH THE GOVERNMENT MAY HAVE BENEFITED FROM THE IMPROVEMENTS.

TO THE ADMINISTRATOR, GENERAL SERVICES ADMINISTRATION, MAY 28, 1959:

THE LETTER OF MAY 11, 1959, FROM THE REGIONAL COMMISSIONER, REGION 3, OF YOUR ADMINISTRATION WILL BE CONSIDERED AS A REQUEST FOR A DECISION AS TO WHETHER LEASE NO. GS-03-B-4176, DATED OCTOBER 22, 1956, AS AMENDED, MAY BE FURTHER AMENDED TO PROVIDE FOR AN INCREASE IN THE ANNUAL RENTAL IN CONSIDERATION OF INSTALLATION BY THE LESSOR OF AN ACOUSTIC CEILING AND CERTAIN CHANGES IN THE HEATING AND COOLING SYSTEM OF THE LEASED SPACE.

THE LEASE AS AMENDED BY SUPPLEMENTAL AGREEMENT OF DECEMBER 19, 1956, IS FOR 2,150 NET SQUARE FEET OF SPACE ON THE FIRST FLOOR OF THE BUILDING AT 105-109 MCCREERY STREET, BECKLEY, WEST VIRGINIA, FOR A TERM BEGINNING DECEMBER 22, 1956, AND ENDING DECEMBER 23, 1961, AT AN ANNUAL RENTAL OF $3,120.

THE CORRESPONDENCE SUBMITTED IN SUPPORT OF THE LESSOR'S CLAIM FOR AN INCREASED RENTAL SHOWS THAT BY LETTER OF SEPTEMBER 23, 1957, THE LESSOR INFORMED THE CHIEF, ADMINISTRATION DIVISION, INTERNAL REVENUE SERVICE, THE AGENCY OCCUPYING THE LEASED SPACE, THAT IT HAD AUTHORIZED THE INSTALLATION OF THE ACOUSTIC CEILING AND NEW HEATING AND COOLING SYSTEM AND REQUESTED THAT CONSIDERATION BE GIVEN TO INCREASING THE RENTAL CONSIDERATION BECAUSE OF THESE IMPROVEMENTS. THE WORK WHICH APPARENTLY HAD BEEN REQUESTED OF THE LESSOR BY THE INTERNAL REVENUE SERVICE APPEARS TO HAVE BEEN NECESSARY DUE TO UNSATISFACTORY AIR-CONDITIONING OPERATION AND HEATING AND SOUND PROBLEMS UNFORESEEN BY THE LESSOR'S ARCHITECT. IN THIS CONNECTION IT IS STATED IN THE SUBMISSION THAT IN OCTOBER 1957 AN OFFICIAL OF YOUR REGIONAL OFFICE, REGION 3, WAS ADVISED THAT EXCESSIVE NOISE WAS BEING PRODUCED FROM THE AIR-CONDITIONING EQUIPMENT AND THAT HE REQUESTED THE LESSOR TO MOVE THE MACHINERY TO THE NEXT DOOR BUILDING. THE WORK FOR WHICH REIMBURSEMENT IS CLAIMED WAS PERFORMED BY THE LESSOR'S CONTRACTORS. IT INCLUDED THE INSTALLATION OF A SUSPENDED ACOUSTIC CEILING, HEATING AND AIR-CONDITIONING CHANGES AND THE LOWERING OF THE SPRINKLER SYSTEM AT AN AGGREGATE COST OF $5,113.05. ON DECEMBER 7, 1957, THE LESSOR NOTIFIED THE INTERNAL REVENUE SERVICE THAT IT HAD COMPLETED THE WORK AND REQUESTED THAT THE ANNUAL RENT BE INCREASED TO $3 PER SQUARE FOOT OR TO $6,450. IT APPEARS, HOWEVER, THAT THE MATTER WAS NOT CALLED TO THE ATTENTION OF THE CONTRACTING OFFICER UNTIL AUGUST 15, 1958, WHEN THE CHIEF, ADMINISTRATION DIVISION, INTERNAL REVENUE SERVICE, REFERRED TO DISCUSSIONS HAD IN THE FALL OF 1957 CONCERNING THE ADDITIONAL EXPENSE TO THE LESSOR NECESSITATED BY THE UNSATISFACTORY AIR-CONDITIONING, HEATING, LIGHTING, AND SOUND PROBLEMS.

IN SUPPORT OF THE LESSOR'S REQUEST IT IS STATED IN ITS LETTER OF NOVEMBER 7, 1958, TO THE CONTRACTING OFFICER THAT ALL NEGOTIATIONS FOR THE SPACE, EXCEPT THE ACTUAL EXECUTION OF THE LEASE, WERE CONDUCTED WITH THE CHIEF, ADMINISTRATION DIVISION, INTERNAL REVENUE SERVICE, AND THAT THE CHANGES WERE MADE UPON THE RECOMMENDATION OF THE OFFICERS IN CHARGE OF THE AGENCY WITH THE UNDERSTANDING THAT THERE WOULD BE AN ADJUSTMENT IN THE RENTAL FOR THE IMPROVEMENT OF THE PROPERTY FOR THEIR CONVENIENCE. PARAGRAPH 6 OF THE LEASE OBLIGATES THE LESSOR TO FURNISH AS PART OF THE RENTAL CONSIDERATION CERTAIN SPECIAL SERVICES INCLUDING "HEAT TO MAINTAIN A TEMPERATURE OF NOT LESS THAN 72 DEGREES FAHRENHEIT, DURING THE HEATING SEASON" TOGETHER WITH "AIR-CONDITIONING, INCLUDING MAINTENANCE, OPERATION AND POWER; SAID AIR- CONDITIONING TO BE OPERATED AT SUCH TIMES AS NECESSARY TO MAINTAIN AN INDOOR TEMPERATURE OF 76 DEGREES FAHRENHEIT DRY BULB AND 64 DEGREES FAHRENHEIT WET BULB.' PARAGRAPH 9 REQUIRES THE LESSOR TO MAINTAIN THE PREMISES IN GOOD REPAIR AND TENANTABLE CONDITION DURING THE CONTINUANCE OF THE LEASE.

IT HAS BEEN HELD THAT WHERE THE GOVERNMENT'S LESSOR IS OBLIGATED TO FURNISH SPECIAL SERVICES AS PART OF THE RENTAL CONSIDERATION HE IS OBLIGATED TO FURNISH SUCH ADDITIONAL FACILITIES AS REQUIRED IN THE COURSE OF BUSINESS OF THE ADMINISTRATIVE AGENCY OCCUPYING THE LEASED PREMISES. UNITED POST OFFICES CORPORATION V. UNITED STATES, 79 C.1CLS. 173. THESE ARE CONTINUING OBLIGATIONS AND THE FACT THAT THE REMODELING OF THE BUILDING MAY HAVE BEEN COMPLETED IN ACCORDANCE WITH SPECIFICATIONS APPROVED AT THAT TIME BY GSA MAY NOT BE REGARDED AS RELIEVING THE LESSOR FROM THE SPECIFIC REQUIREMENTS OF THE LEASE AS APPEARS TO BE CONTENDED BY THE LESSOR. 20 COMP. GEN. 327. UNITED POST OFFICE CORPORATION V. UNITED STATES, 80 C.1CLS. 785. ACCORDINGLY, SINCE THE RECORD SHOWS THAT THE INVOLVED EXPENSES INCURRED BY THE LESSOR WERE INCURRED BECAUSE OF "AN UNSATISFACTORY AIR-CONDITIONING OPERATION AND HEATING AND SOUND PROBLEMS," IT WAS INCUMBENT UPON THE LESSOR TO MAKE SUCH CHANGES PURSUANT TO THE REQUIREMENTS OF THE LEASE WITHOUT ADDITIONAL CONSIDERATION.

EVEN THOUGH SOME OF THE CHANGES MADE BY THE LESSOR MIGHT BE CONSIDERED AS EXCEEDING THE LESSOR'S OBLIGATION UNDER THE PROVISIONS OF PARAGRAPHS 6 AND 9 OF THE LEASE, WE WOULD NOT BE JUSTIFIED IN AUTHORIZING AN AMENDMENT TO THE LEASE TO PROVIDE FOR AN INCREASED RENTAL BECAUSE IT IS THE FUNCTION OF GENERAL SERVICES ADMINISTRATION TO PROVIDE OFFICE SPACE AND NECESSARY BUILDING SERVICES TO THE INTERNAL REVENUE SERVICE. REORGANIZATION PLAN NO. 18 OF 1950 (15 F.R. 3177, 64 STAT. 1270, 5 U.S.C. 133Z-15). THE CITED REORGANIZATION PLAN TRANSFERRED TO THE ADMINISTRATOR OF GENERAL SERVICES THE FUNCTIONS OF THE VARIOUS AGENCIES WITH RESPECT TO THE LEASING AND ASSIGNMENT OF GENERAL PURPOSE SPACE TOGETHER WITH THE OPERATION, MAINTENANCE, AND CUSTODY OF OFFICE BUILDINGS. A LEASE MADE BY GENERAL SERVICES PURSUANT TO ITS FUNCTIONS AND DUTY UNDER THE AUTHORITY GRANTED TO IT MAY NOT BE AMENDED OR MODIFIED BY AN AGREEMENT MADE BY THE OCCUPYING AGENCY WITH THE LESSOR. 32 COMP. GEN. 342. WHILE IT MAY BE TRUE THAT THE CHANGES WERE MADE UPON THE RECOMMENDATION OF THE OFFICERS IN CHARGE OF THE OCCUPYING AGENCY AND WITH THE UNDERSTANDING THAT THERE WOULD BE AN ADJUSTMENT OF RENT, IN THE ABSENCE OF A SHOWING THAT THE OFFICERS IN CHARGE WERE ACTING ON BEHALF OF THE CONTRACTING OFFICER THERE IS NO LEGAL BASIS FOR AMENDING THE LEASE TO PROVIDE FOR AN INCREASE IN THE RENTAL RATE EVEN THOUGH THE GOVERNMENT MAY HAVE BENEFITED FROM THE IMPROVEMENT. COMP. GEN. 568; GAY STREET CORPORATION OF BALTIMORE, MARYLAND V. UNITED STATES, 130 C.1CLS. 341; J. AND J. W. STOLTS ASSOC. V. UNITED STATES, 66 C.1CLS. 1, 8.

FOR THE REASON STATED WE FIND NO LEGAL BASIS FOR AMENDING THE LEASE TO PROVIDE FOR A RENTAL INCREASE. THEREFORE, YOUR QUESTION IS ANSWERED IN THE NEGATIVE.