B-141738, FEB. 4, 1960

B-141738: Feb 4, 1960

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TO THE SECRETARY OF AGRICULTURE: REFERENCE IS MADE TO A LETTER DATED JANUARY 19. NEW CONSTRUCTION WAS CONTEMPLATED WHICH WOULD NOT BE COMPLETED UNTIL LATE IN 1959. THE RESULT OF THIS CANVASS INDICATED IT WOULD BE TO THE BEST INTEREST OF THE GOVERNMENT TO CONTINUE OCCUPANCY OF THE MEARS SPACE IF CERTAIN REPAIRS AND IMPROVEMENTS WERE MADE. THE LESSOR WAS AGREEABLE TO MAKING THE REPAIRS AND IMPROVEMENTS PROVIDED A NEW LEASE WAS PREPARED STIPULATING A RENTAL RATE OF $275 PER MONTH WITH THE SERVICE TO FURNISH ALL UTILITIES. THE SERVICE ERRONEOUSLY INDICATED THAT THE LESSOR WAS TO FURNISH CERTAIN UTILITIES AS A PART OF THE RENTAL RATE. TO THE CONTRACTING OFFICER STATED THAT IT DID NOT DETECT THE ERROR BECAUSE IT TOOK THE PROVISION OF PARAGRAPH 8 (A) OF THE LEASE TO MEAN THAT THE LESSOR WAS TO FURNISH THE FACILITY FOR THE SERVICE AND THAT THE TENANT WAS TO FURNISH THE FUEL.

B-141738, FEB. 4, 1960

TO THE SECRETARY OF AGRICULTURE:

REFERENCE IS MADE TO A LETTER DATED JANUARY 19, 1960, WITH ENCLOSURES, FROM E. L. PETERSON, ASSISTANT SECRETARY, REQUESTING TO BE ADVISED WHETHER OUR OFFICE WOULD OBJECT TO A PROPOSED AMENDMENT TO PARAGRAPH 8 (A) OF LEASE NO. 12-10-290-230, DATED JULY 3, 1959, WITH MEARS AND MEARS, TO RELIEVE THE LESSORS FROM FURNISHING HEAT AND UTILITIES.

IT APPEARS FROM THE CONTRACTING OFFICER'S LETTER OF DECEMBER 29, 1959, THAT THE LESSOR HAS FURNISHED FACILITIES FOR THE NEEDS OF THE SOIL CONSERVATION SERVICE AT PORTALES, NEW MEXICO, SINCE 1952. LATE IN FISCAL YEAR 1959 IT APPEARED THAT GENERAL SERVICES ADMINISTRATION WOULD ACT TO LEASE SPACE FOR THE SERVICE AND OTHER AGENCIES AT PORTALES. HOWEVER, NEW CONSTRUCTION WAS CONTEMPLATED WHICH WOULD NOT BE COMPLETED UNTIL LATE IN 1959. TO PROVIDE SPACE FOR ITS ACTIVITIES BEGINNING JULY 1, 1959, AND CONTINUING UNTIL THE NEW CONSTRUCTION COULD BE OCCUPIED, THE SERVICE CONDUCTED A CANVASS OF AVAILABLE SPACE. THE RESULT OF THIS CANVASS INDICATED IT WOULD BE TO THE BEST INTEREST OF THE GOVERNMENT TO CONTINUE OCCUPANCY OF THE MEARS SPACE IF CERTAIN REPAIRS AND IMPROVEMENTS WERE MADE. THE LESSOR WAS AGREEABLE TO MAKING THE REPAIRS AND IMPROVEMENTS PROVIDED A NEW LEASE WAS PREPARED STIPULATING A RENTAL RATE OF $275 PER MONTH WITH THE SERVICE TO FURNISH ALL UTILITIES.

THE RECORD INDICATES THAT IN PREPARING THE LEASE, THE SERVICE ERRONEOUSLY INDICATED THAT THE LESSOR WAS TO FURNISH CERTAIN UTILITIES AS A PART OF THE RENTAL RATE. THE LESSOR IN ITS LETTER OF OCTOBER 24, 1959, TO THE CONTRACTING OFFICER STATED THAT IT DID NOT DETECT THE ERROR BECAUSE IT TOOK THE PROVISION OF PARAGRAPH 8 (A) OF THE LEASE TO MEAN THAT THE LESSOR WAS TO FURNISH THE FACILITY FOR THE SERVICE AND THAT THE TENANT WAS TO FURNISH THE FUEL, ELECTRICITY AND WATER.

THE FACTS AS PRESENTED CLEARLY ESTABLISH THAT THE PARTIES DID NOT INTEND THAT THE LESSORS WOULD BE REQUIRED TO FURNISH SUCH UTILITIES AS PART OF THE RENTAL CONSIDERATION AND, THEREFORE, THAT PARAGRAPH 8 (A) OF THE LEASE OBLIGATING THEM TO DO SO DOES NOT EXPRESS THE TRUE AGREEMENT AND UNDERSTANDING OF THE PARTIES. ACCORDINGLY, THE LEASE SHOULD BE MODIFIED FOR THE PURPOSE OF RELIEVING THE LESSOR OF THE OBLIGATIONS TO FURNISH SUCH UTILITIES. A REFERENCE TO THIS DECISION SHOULD BE MADE IN SUCH MODIFICATION.

THE PAPERS, WITH THE EXCEPTION OF THE CONTRACTING OFFICER'S LETTER OF DECEMBER 29, 1959, ADDRESSED TO US, ARE RETURNED.