B-142105, APR. 1, 1960

B-142105: Apr 1, 1960

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TO AMERICAN SANITARY RAG COMPANY: REFERENCE IS MADE TO YOUR LETTER OF FEBRUARY 8. "REQUIREMENTS: QUANTITIES INDICATED REPRESENT THE ESTIMATED REQUIREMENTS OF THE GOVERNMENT DURING THE TERM OF THIS CONTRACT AND ARE BASED UPON THE EXPERIENCES OF THE GOVERNMENT AS REFLECTED IN THE RECORDS OF THIS AGENCY. NO GUARANTEE IS GIVEN OR IMPLIED THAT ANY ORDERS WILL BE PLACED PURSUANT TO THIS CONTRACT. A COPY OF THE PERTINENT PAGE OF YOUR BID IS ENCLOSED. EACH ITEM IS FOR A STATED QUANTITY. BIDS ARE REQUESTED ON EACH INDIVIDUAL ITEM. THERE IS ALSO AN ATTACHED SHEET CONSISTING OF A TABLE WHICH LISTS EACH OF THE ITEMS. OPPOSITE EACH ITEM ARE FOUR COLUMNS FOR QUOTATION OF UNIT PRICES ON MINIMUM QUANTITIES OF 4.

B-142105, APR. 1, 1960

TO AMERICAN SANITARY RAG COMPANY:

REFERENCE IS MADE TO YOUR LETTER OF FEBRUARY 8, 1960, REQUESTING REVIEW OF THE SETTLEMENT OF FEBRUARY 4, 1960, WHICH DISALLOWED YOUR CLAIM FOR $6,630, REPRESENTING LOSS FOR OVERHEAD AND PROFIT ALLEGED TO BE DUE IN CONNECTION WITH CONTRACT NO. GS-902-5897, DATED APRIL 9, 1959, ISSUED BY THE GENERAL SERVICES ADMINISTRATION, SAN FRANCISCO, CALIFORNIA.

THE RECORD SHOWS THAT INVITATION NO. SFT-13892-59, ISSUED BY THE GENERAL SERVICES ADMINISTRATION, SAN FRANCISCO, CALIFORNIA, REQUESTED BIDS FOR FURNISHING WIPING RAGS, DESCRIBED IN AN ACCOMPANYING SCHEDULE, FOR DELIVERY F.O.B. SOUTH SAN FRANCISCO, CALIFORNIA, AND LOS ANGELES, CALIFORNIA, STORES DEPOTS. THE INVITATION PROVIDED IN PERTINENT PART AS FOLLOWS:

"PURPOSE: TO ESTABLISH A TERM CONTRACT UNDER WHICH THE GENERAL SERVICES ADMINISTRATION, REGION 9, MAY ORDER THE ITEMS LISTED HEREIN AS MAY BE NEEDED FROM TIME TO TIME THROUGHOUT THE PERIOD STATED BELOW.

"REQUIREMENTS: QUANTITIES INDICATED REPRESENT THE ESTIMATED REQUIREMENTS OF THE GOVERNMENT DURING THE TERM OF THIS CONTRACT AND ARE BASED UPON THE EXPERIENCES OF THE GOVERNMENT AS REFLECTED IN THE RECORDS OF THIS AGENCY. NO GUARANTEE IS GIVEN OR IMPLIED THAT ANY ORDERS WILL BE PLACED PURSUANT TO THIS CONTRACT. THE GOVERNMENT RESERVES THE RIGHT TO ORDER NOT IN EXCESS OF 100 PERCENT MORE THAN THE TOTAL QUANTITIES INDICATED IN THIS CONTRACT DURING THE TERM HEREOF AND IN EXCESS OF THAT QUANTITY ONLY WITH THE CONCURRENCE OF THE CONTRACTOR. * * * .'

A COPY OF THE PERTINENT PAGE OF YOUR BID IS ENCLOSED.

THE ACCOMPANYING SCHEDULE CONTAINS NUMBERED ITEMS REPRESENTING WIPING RAGS, THEREIN DESCRIBED, AND EACH ITEM IS FOR A STATED QUANTITY, IN POUNDS, FOR SHIPMENT F.O.B. TO A DESIGNATED POINT. BIDS ARE REQUESTED ON EACH INDIVIDUAL ITEM. THERE IS ALSO AN ATTACHED SHEET CONSISTING OF A TABLE WHICH LISTS EACH OF THE ITEMS. OPPOSITE EACH ITEM ARE FOUR COLUMNS FOR QUOTATION OF UNIT PRICES ON MINIMUM QUANTITIES OF 4,000, 10,000, 20,000, AND 40,000 POUNDS, RESPECTIVELY. AMERICAN SANITARY RAG COMPANY SUBMITTED BIDS ON EACH OF THE ITEMS AT THE QUANTITIES SPECIFIED IN THE SCHEDULE, INCLUDING UNIT BID PRICES ON 60,000 POUNDS AS TO ITEM 3, F.O.B. SOUTH SAN FRANCISCO, AND 25,000 POUNDS AS TO ITEM 5, F.O.B. SOUTH SAN FRANCISCO. IT IS NOTED THAT YOU SPECIFIED "IN SHIPMENTS OF 40,000" AS TO ITEMS 3 AND 4, AND "IN CARLOAD SHIPMENTS" AS TO ITEMS 5 AND 6. YOU ALSO FILLED IN THE ATTACHED TABLE BY PLACING THE SAME UNIT BID PRICES UNDER THE COLUMN HEADED ,UNIT PRICE MINIMUM QTY 40,000 LBS" FOR ALL THE ITEMS THEREIN LISTED, INCLUDING ITEMS 3 AND 5. NO PRICES WERE QUOTED ON THE SMALLER MINIMUM QUANTITIES. ON APRIL 9, 1959, AMERICAN RAG COMPANY'S BID WAS ACCEPTED AS TO ITEMS 3 AND 5 AND CONTRACT NO. GS-09S-5897 WAS AWARDED, PROVIDING "MIN QTY 40,000 LBS" FOR ITEMS 3 AND 5, WITH THE TERMS AND CONDITIONS OF THE INVITATION BEING MADE A PART OF THE RESULTANT CONTRACT.

THE CONTRACT PROVIDED FOR A TERM FROM THE DATE OF AWARD THROUGH OCTOBER 15, 1959. NO ORDERS WERE PLACED DURING THE CONTRACT PERIOD. IN A LETTER DATED SEPTEMBER 25, 1959, FROM THE CONTRACTING OFFICER, YOU WERE ADVISED THAT THE AWARD WAS BASED ON A MINIMUM ORDER OF 40,000 POUNDS AND, SINCE AGENCY REQUIREMENTS HAD NOT APPROACHED THIS QUANTITY, NO ORDERS COULD BE PLACED.

BY LETTER OF OCTOBER 21, 1959, YOU FILED A CLAIM WITH OUR CLAIMS DIVISION. IT WAS THEREIN ALLEGED THAT CONTRACT NO. GS-09S-5897 IS A SPECIFIC ORDER FOR 60,000 POUNDS OF WIPING RAGS AS DESCRIBED BY ITEM 3, AND 25,000 POUNDS OF WIPING RAGS AS DESCRIBED BY ITEM 5, AT THE PRICES QUOTED, AMOUNTING TO A TOTAL CONTRACT PRICE OF $22,100, AND THE SUPPLIER HAD NOTHING TO DO WITH THE SIZE OF THE ORDERS THAT GSA MIGHT RECEIVE. THE CLAIM IS FOR $6,630, CONSISTING OF AN ALLEGED LOSS FOR OVERHEAD AND PROFIT FOR NON-DELIVERY.

THE INVITATION AND RESULTANT CONTRACT PROVIDE THAT THE QUANTITIES INDICATED REPRESENT ESTIMATED REQUIREMENTS DURING THE CONTRACT PERIOD AND THAT NO GUARANTEE IS GIVEN, OR IMPLIED, THAT ANY ORDERS WILL BE PLACED PURSUANT TO THE CONTRACT. UNDER THE TERMS OF THE CONTRACT THE GOVERNMENT WAS OBLIGATED ONLY TO PURCHASE ITS NEEDS DURING THE CONTRACT TERM, REQUIRING SHIPMENT OF AT LEAST 40,000 POUNDS OF WIPING RAGS. IT IS REPORTED THAT SUCH NEEDS DID NOT ARISE DURING THE CONTRACT PERIOD AND, THEREFORE, NO ORDER WAS REQUIRED TO BE PLACED WITH YOU.

ACCORDINGLY, THERE IS NO AUTHORITY FOR PAYMENT OF THE AMOUNT CLAIMED, AND THE SETTLEMENT OF FEBRUARY 8, 1960, WHICH DISALLOWED YOUR CLAIM, MUST BE AND IS SUSTAINED.