B-142358, APR. 5, 1960

B-142358: Apr 5, 1960

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TO HIGHWAY MOTOR PARTS COMPANY: FURTHER REFERENCE IS MADE TO YOUR LETTER DATED MARCH 10. IT APPEARS THAT YOUR BID WAS ACCEPTED BY THE ORDNANCE CORPS ON ITEM NO. 112. THAT PAYMENT WAS MADE THEREFOR. WHICH WAS FACTORY STENCILED AS CONTAINING THE QUANTITY OF 2. WOULD HAVE DISCLOSED SUCH AN EXAGGERATED DISCREPANCY OF 1. YOU STATE THAT IT IS ON THE BASIS OF MISREPRESENTATION. IN OUR SETTLEMENT YOUR ATTENTION WAS DIRECTED TO THE EXPRESS LANGUAGE SET FORTH IN ARTICLES 2 AND 8 OF THE APPLICABLE GENERAL SALE TERMS AND CONDITIONS OF THE INVITATION. ARTICLE 8 PLACED YOU ON NOTICE BEFORE THE SALE THAT NO ADJUSTMENT WOULD BE MADE FOR A VARIATION BETWEEN THE QUANTITY LISTED AND THE QUANTITY DELIVERED WHERE AWARD WAS MADE ON A "PRICE FOR THE LOT" BASIS.

B-142358, APR. 5, 1960

TO HIGHWAY MOTOR PARTS COMPANY:

FURTHER REFERENCE IS MADE TO YOUR LETTER DATED MARCH 10, 1960, IN REGARD TO OUR SETTLEMENT OF MARCH 8, 1960, DISALLOWING YOUR CLAIM FOR $324 UNDER INVITATION NO. 41-117-S-60-4.

IN RESPONSE TO THE INVITATION, ISSUED ON AUGUST 4, 1959, BY THE ORDNANCE CORPS, U.S. ARMY, RED RIVER ARSENAL, TEXARKANA, TEXAS, YOU SUBMITTED A BID OFFERING TO PURCHASE ITEM NO. 112, COVERING SENDING UNIT, ENGINE WATER TEMPERATURE, UNUSED, APPROXIMATELY 2,491 EACH, ETC., FOR A TOTAL CONSIDERATION OF $448.56 FOR THE LOT. IT APPEARS THAT YOUR BID WAS ACCEPTED BY THE ORDNANCE CORPS ON ITEM NO. 112; THAT PAYMENT WAS MADE THEREFOR; AND THAT SHIPMENT OF THE MATERIAL WENT FORWARD TO YOU. APPEARS FURTHER THAT UPON RECEIPT OF THE MATERIAL YOU DISCOVERED THAT INSTEAD OF RECEIVING THE 2,491 BULBS DESCRIBED IN THE INVITATION FOR ITEM NO. 112 YOU RECEIVED ONLY 691 BULBS. AS A RESULT, YOU CLAIM A REFUND OF $324 BASED ON YOUR APPROXIMATE UNIT BID PRICE OF $0.18 FOR THE SHORTAGE OF 1,800 BULBS IN THE SHIPMENT.

IN YOUR LETTER OF MARCH 10, 1960, YOU STATE THAT NO VISUAL INSPECTION OF THE CONTAINER, WHICH WAS FACTORY STENCILED AS CONTAINING THE QUANTITY OF 2,400 UNITS, WOULD HAVE DISCLOSED SUCH AN EXAGGERATED DISCREPANCY OF 1,800 UNITS; ALSO, THAT NO PROSPECTIVE BUYER WOULD BREAK OPEN A FACTORY SEALED CONTAINER AND HAND COUNT THE CONTENTS DURING AN INSPECTION. YOU STATE THAT IT IS ON THE BASIS OF MISREPRESENTATION, AS EVIDENCED BY THE STENCIL, THAT YOU BASE THE CLAIM.

IN OUR SETTLEMENT YOUR ATTENTION WAS DIRECTED TO THE EXPRESS LANGUAGE SET FORTH IN ARTICLES 2 AND 8 OF THE APPLICABLE GENERAL SALE TERMS AND CONDITIONS OF THE INVITATION. ARTICLE 8 PLACED YOU ON NOTICE BEFORE THE SALE THAT NO ADJUSTMENT WOULD BE MADE FOR A VARIATION BETWEEN THE QUANTITY LISTED AND THE QUANTITY DELIVERED WHERE AWARD WAS MADE ON A "PRICE FOR THE LOT" BASIS. IN ADDITION, 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 THAT THE LANGUAGE OF ARTICLE 2 WHICH SPECIFICALLY REFERS TO "QUANTITY," CONSTITUTES AN EXPRESS DISCLAIMER OF WARRANTY. THE COURTS HOLD THAT UNDER SUCH TERMS AND CONDITIONS NO WARRANTY MAY BE IMPLIED. 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 BEFORE US TO SHOW THAT BAD FAITH MAY BE ATTRIBUTED TO THE GOVERNMENT IN THE TRANSACTION. MOREOVER, YOU DID RECEIVE THE IDENTICAL PROPERTY ADVERTISED FOR SALE ALTHOUGH A SHORTAGE THEREIN APPARENTLY EXISTED. THE FACT THAT THERE WAS STENCILED ON THE EXTERIOR OF ONE OF THE CONTAINERS "2400 EA BULB" IN NO WAY MAY BE ACCEPTED AS CONSTITUTING A WARRANTY OF THAT QUANTITY. SUCH LABELING AMOUNTS TO NOTHING MORE THAN ADDITIONAL DESCRIPTIVE MATTER COMPARABLE TO THAT APPEARING ON THE INVITATION ITSELF AND THE EXPRESS DISCLAIMER OF WARRANTY IS EQUALLY APPLICABLE TO THE ONE AS TO THE OTHER.

INSOFAR AS CONCERNS YOUR CONTENTION AS TO THE IMPRACTICABILITY OF INSPECTING THE PROPERTY, THE RECORD BEFORE US INDICATES THAT IN THE FIRST INSTANCE YOU MADE NO ATTEMPT TO ASCERTAIN THE EXTENT TO WHICH AN INSPECTION WAS AVAILABLE TO YOU. FURTHER, IN THIS REGARD, ARTICLE 1 OF THE GENERAL SALE TERMS AND CONDITIONS PROVIDES, AMONG OTHERS, THAT "IN NO CASE WILL FAILURE TO INSPECT CONSTITUTE GROUNDS FOR A CLAIM OR FOR THE WITHDRAWAL OF A BID AFTER OPENING.' OUR OFFICE CONSISTENTLY HAS HELD THAT WHERE A BIDDER, WHO IS COMPLETELY APPRISED OF SUCH AN EXPRESS INSPECTION RESTRICTION IN THE INVITATION AS WELL AS HAVING FULL KNOWLEDGE OF THE DISCLAIMER OF WARRANTY CLAUSE, SUBMITS A BID, EITHER WITHOUT MAKING ANY INSPECTION OR WITHOUT MAKING AN ADEQUATE OR THOROUGH INSPECTION, EVEN THOUGH THE LATTER CIRCUMSTANCE IS DUE TO THE INSPECTION BEING IMPRACTICABLE, IT ONLY REASONABLY MAY BE CONCLUDED THAT THE BIDDER ELECTED TO ASSUME ANY RISK WHICH MIGHT EXIST BY REASON OF A VARIANCE BETWEEN THE DESCRIPTION OF THE PROPERTY IN THE INVITATION AND THE PROPERTY ACTUALLY DELIVERED. AS WAS STATED BY THE COURT IN THE CASE OF PAXTON MITCHELL COMPANY V. UNITED STATES, 172 F.SUPP. 463, IT IS INCUMBENT UPON A BIDDER TO MAKE THE SORT OF INSPECTION THAT IS EFFECTUAL. THE FURTHER CONCLUSION NECESSARILY MUST FOLLOW, OF COURSE, THAT HAD YOU NOT BEEN WILLING TO ASSUME SUCH A RISK YOU WOULD NOT HAVE SUBMITTED A BID IN THE FIRST INSTANCE.