B-140681, OCT. 14, 1959

B-140681, OCT. 14, 1959

TO ALL-TRONICS OF SAN DIEGO:

FURTHER REFERENCE IS MADE TO YOUR LETTER DATED AUGUST 24, 1959, REGARDING OUR SETTLEMENT DATED AUGUST 18, 1959, WHICH DISALLOWED YOUR CLAIM FOR $203.40 ALLEGED TO BE DUE UNDER DEPARTMENT OF THE NAVY CONTRACT NO. N244S- 54972.

IN RESPONSE TO INVITATION NO. B-53-59-244, WHICH WAS ISSUED ON OCTOBER 24, 1958, BY THE U.S. NAVAL SUPPLY DEPOT, SAN DIEGO, CALIFORNIA, YOU SUBMITTED A BID OFFERING TO PURCHASE, AMONG OTHERS, ITEM NO. 41, COVERING 135 RADIO SET CONTROL GROUPS--- 2 CONTROL UNITS, 2 HEAD SETS, W/CORD., AND 2 MICROPHONES--- AT $2.26 A GROUP, OR FOR A TOTAL PRICE OF $305.10. THE CONTROL GROUPS WERE DESCRIBED AS BEING UNUSED AND IN GOOD CONDITION WITH AN ORIGINAL ACQUISITION COST OF $7,654.50. YOUR BID WAS ACCEPTED AS TO ITEM NO. 41 AND FULL PAYMENT THEREFOR MADE BY YOU. AT OR ABOUT THE TIME OF DELIVERY OF THE EQUIPMENT TO YOU IT WAS DISCOVERED THAT THE 2 HEAD SETS AND 2 MICROPHONES WERE MISSING FROM EACH OF THE 135 CONTROL GROUPS COVERED BY THIS ITEM. NOTWITHSTANDING THIS YOU DECIDED TO, AND DID, ACCEPT ALL ITEMS INCLUDED IN THE CONTRACT RATHER THAN BE DECLARED IN DEFAULT, AS APPARENTLY YOU WERE ADVISED YOU WOULD BE UPON REFUSAL TO ACCEPT ITEM NO. 41. THIS RESULTED IN YOUR CLAIM WHICH IS STATED TO BE BASED UPON THE RECEIPT OF ONLY ONE-THIRD OF THE UNITS IN THE CONTROL GROUP AND, THEREFORE, YOU REQUEST A REFUND OF TWO-THIRDS OF THE PURCHASE PRICE OF $305.10, OR $203.40. IN YOUR LETTER OF AUGUST 24, 1959, YOUR BASIC POSITION APPEARS TO BE THAT THE DEPARTMENT OF THE NAVY CLEARLY ADMITS THAT IT DID NOT DELIVER A COMPLETE LOT OF THE RADIO SET CONTROL GROUPS TO YOU.

IT APPEARS FROM THE RECORD THAT THE SAN DIEGO NAVAL SUPPLY DEPOT CONCEDES THAT NO HEAD SETS OR MICROPHONES WERE DELIVERED TO YOU AS A PART OF THE COMPLETE RADIO SET CONTROL GROUPS COVERED BY ITEM NO. 41 OF INVITATION NO. B-53-59-244. HOWEVER, THIS FACT DOES NOT RENDER INAPPLICABLE THE CONTROLLING TERMS AND CONDITIONS OF THE CONTRACT OF SALE TO WHICH YOU AGREED. IN THIS REGARD, REFERENCE IS AGAIN MADE TO PARAGRAPH 2 OF THE GENERAL SALE TERMS AND CONDITIONS OF THE INVITATION WHICH WAS BROUGHT TO YOUR ATTENTION IN OUR SETTLEMENT OF AUGUST 18, 1959. PERTINENT PROVISIONS OF THIS PARAGRAPH READ AS FOLLOWS:

"ALL PROPERTY LISTED HEREIN IS OFFERED FOR SALE "AS IS" AND "WHERE IS," AND WITHOUT RECOURSE AGAINST THE GOVERNMENT. * * * THE GOVERNMENT MAKES NO GUARANTY, WARRANTY, OR REPRESENTATION, EXPRESSED OR IMPLIED, AS TO QUANTITY, KIND, CHARACTER, QUALITY, WEIGHT, SIZE, OR DESCRIPTION OF ANY OF THE PROPERTY, OR ITS FITNESS FOR ANY USE OR PURPOSE, AND NO CLAIM WILL BE CONSIDERED FOR ALLOWANCE OR ADJUSTMENT OR FOR RESCISSION OF THE SALE BASED UPON FAILURE OF THE PROPERTY TO CORRESPOND WITH THE STANDARD EXPECTED; * *

IT CONSISTENTLY HAS BEEN HELD BY THE COURTS AND OUR OFFICE THAT, IN THE ABSENCE OF BAD FAITH, OR WHERE IT IS NOT SHOWN THAT THE PROPERTY SOLD WAS OTHER THAN THAT ADVERTISED FOR SALE, SUCH LANGUAGE CONSTITUTES AN EXPRESS DISCLAIMER OF WARRANTY. ORDINARILY, OF COURSE, THERE IS AN IMPLIED WARRANTY, IN THE SALE OF PERSONAL PROPERTY BY DESCRIPTION THAT THE PROPERTY WILL CORRESPOND WITH THE DESCRIPTION, BUT WHERE THERE EXISTS AN EXPRESS DISCLAIMER OF WARRANTY--- AS IN THE INSTANT CASE--- NO SUCH WARRANTY MAY BE IMPLIED FROM THE DESCRIPTION OF THE PROPERTY SOLD. SEE LUMBRAZO V. WOODRUFF, 175 N.E. 525; W. E. HEDGER COMPANY V. UNITED STATES, 52 F.2D 31, CERTIORARI DENIED 284 U.S. 676; TRIAD CORPORATION V. UNITED STATES, 63 C.CLS. 151; AND I. SHAPIRO AND COMPANY V. UNITED STATES, 66 C.CLS. 424. THERE IS NOTHING IN THE RECORD TO SHOW THAT BAD FAITH MAY BE IMPUTED TO THE DEPARTMENT OF THE NAVY IN CONNECTION WITH THE ERRONEOUS DESCRIPTION OF ITEM NO. 41 OF THE INVITATION. THE DESCRIPTION APPEARS TO HAVE RESULTED FROM AN HONEST ERROR.

MOREOVER, WE NOTE FROM YOUR COMMUNICATION OF DECEMBER 3, 1958, TO THE NAVAL SUPPLY DEPOT, THAT YOU ADMIT THAT YOU BID ON ITEM NO. 41 AFTER INSPECTING THE SAMPLE CASE OF TWO CONTROL UNITS THAT HAD BEEN MARKED "SAMPLE.' THE SUPPLY DEPOT REPORTS THAT EACH OF THE SAMPLE SETS DISPLAYED FOR INSPECTION AND THE OTHER SETS UNDER ITEM NO. 41 CONSISTED OF 2 CONTROL UNITS, 2 CANVAS CARRYING CASES, 1 INSTRUCTION MANUAL AND 1 PACKING SLIP. THE DEPOT FURTHER REPORTS THAT THE PARTS DISPLAYED COINCIDED WITH THOSE LISTED ON THE PACKING SLIPS AND NOT ONLY WERE THE HEAD SETS AND MICROPHONES PHYSICALLY MISSING FROM THE PARTS DISPLAYED FOR INSPECTION BUT THEY WERE NOT EVEN LISTED ON THE PACKING SLIPS AS PARTS PACKED WITH THE SETS. THIS BEING THE CASE, WE BELIEVE THAT IT ONLY REASONABLY MAY BE CONCLUDED THAT YOU WERE ON NOTICE OF THE PROBABILITY OF THE EXISTENCE OF AN ERROR OF SOME NATURE REGARDING THE SALE OF THIS ITEM, AND THERE CAN BE NO DOUBT THAT HAD YOU QUESTIONED THIS APPARENT DISCREPANCY THE ERROR WOULD HAVE BEEN DETECTED PRIOR TO THE CONSUMMATION OF A BINDING CONTRACT.

IN CASES OF THIS KIND THE RIGHTS AND LIABILITIES OF THE PARTIES BECOME FIXED UPON THE ACCEPTANCE OF THE BID WHICH, OF COURSE, WAS MADE BEFORE THE ERROR WAS DISCOVERED, AND NEITHER OUR OFFICE NOR ANY OFFICER OF THE GOVERNMENT IS AUTHORIZED TO WAIVE OR RELINQUISH THE RIGHTS WHICH ..END :