B-142504, MAY 12, 1960

B-142504: May 12, 1960

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INC.: REFERENCE IS MADE TO YOUR LETTER OF MARCH 23. WHEREIN THERE WAS DISALLOWED YOUR CLAIM FOR AN ADJUSTMENT UNDER DEPARTMENT OF THE AIR FORCE CONTRACT NO. (41 -608/S-59-906. YOUR BID OF $125.25 EACH WAS ACCEPTED. IS PRIMARILY BASED ON YOUR CONTENTION THAT THE STARTERS WERE MISDESCRIBED IN THE INVITATION. ARTICLE 2 OF THE GENERAL SALE TERMS AND CONDITIONS OF THE INVITATION FOR BIDS CONTAINED THE FOLLOWING EXPRESS PROVISIONS: "ALL PROPERTY LISTED HEREIN IS OFFERED FOR SALE "AS IS. 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. THERE IS AN IMPLIED WARRANTY THAT THE PROPERTY WILL CORRESPOND WITH THE DESCRIPTION.

B-142504, MAY 12, 1960

TO DUKE HARRAH, INC.:

REFERENCE IS MADE TO YOUR LETTER OF MARCH 23, 1960, REQUESTING REVIEW OF OUR SETTLEMENT DATED MARCH 18, 1960, WHEREIN THERE WAS DISALLOWED YOUR CLAIM FOR AN ADJUSTMENT UNDER DEPARTMENT OF THE AIR FORCE CONTRACT NO. (41 -608/S-59-906, DATED MAY 22, 1959.

IT APPEARS THAT IN RESPONSE TO INVITATION NO. 41-608-S-59-58, ISSUED BY THE REDISTRIBUTION AND MARKETING DIVISION, CONTRACTING BRANCH, KELLY AIR FORCE BASE, TEXAS, YOU SUBMITTED A BID DATED MAY 8, 1959, OFFERING TO PURCHASE ITEM NO. 187, COVERING 7 STARTER ASSEMBLY ENGINES REFERRED TO IN THE ITEM DESCRIPTION AS "ECLIPSE 756-56C.' YOUR BID OF $125.25 EACH WAS ACCEPTED. BY LETTER OF JUNE 25, 1959, YOU ADVISED THAT YOU HAD RECEIVED ONLY TWO 756-56C STARTERS AND FIVE 756-56B STARTERS. YOU REQUESTED AN ADJUSTMENT OF $250 IN THE CONTRACT PRICE.

IT APPEARS FROM YOUR LETTER OF MARCH 23, 1960, THAT THE REQUEST FOR REVIEW OF OUR SETTLEMENT DATED MARCH 18, 1960, IS PRIMARILY BASED ON YOUR CONTENTION THAT THE STARTERS WERE MISDESCRIBED IN THE INVITATION.

ARTICLE 2 OF THE GENERAL SALE TERMS AND CONDITIONS OF THE INVITATION FOR BIDS CONTAINED THE FOLLOWING EXPRESS PROVISIONS:

"ALL PROPERTY LISTED HEREIN IS OFFERED FOR SALE "AS 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, SUCH LANGUAGE CONSTITUTES AN EXPRESS DISCLAIMER OF WARRANTY. WHILE ORDINARILY IN THE SALE OF PERSONAL PROPERTY BY DESCRIPTION, THERE IS AN IMPLIED WARRANTY THAT THE PROPERTY WILL CORRESPOND WITH THE DESCRIPTION, AN EXPRESS DISCLAIMER OF WARRANTY SUCH AS THE ABOVE-QUOTED PROVISION, EFFECTIVELY PRECLUDES ANY IMPLICATION OF A WARRANTY FROM THE DESCRIPTION OF THE PROPERTY SOLD, AS THE DISCLAIMER OF WARRANTY EXTENDS TO AND INCLUDES THE DESCRIPTION. 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. NOT ONLY THE DESCRIPTION, BUT THE "KIND" AND "CHARACTER" OF THE MATERIAL ARE EMBRACED BY THE DISCLAIMER, AND THE COURTS HAVE HELD THAT UNDER SUCH TERMS THE BIDDERS ASSUME ALL RISKS OF THE PROPERTY NOT CORRESPONDING TO THE DESCRIPTION, THE ONLY OBLIGATION OF THE GOVERNMENT BEING TO USE GOOD FAITH. THERE IS NOTHING IN THE RECORD BEFORE US TO SHOW OR EVEN INDICATE, NOR DO YOU ALLEGE, THAT BAD FAITH MAY BE ATTRIBUTED TO THE GOVERNMENT IN THE TRANSACTION. EVEN THOUGH IT IS SHOWN THAT YOU RECEIVED FIVE 756-56B STARTERS AND ONLY TWO 756-56C STARTERS, THERE IS NO SUGGESTION THAT YOU DID NOT RECEIVE THE EXACT ITEMS DISPLAYED AND INTENDED TO BE OFFERED AS ITEM 187.

IN YOUR LETTER OF JANUARY 19, 1960, TO THE KELLY AIR FORCE BASE YOU STATED "PLEASE BE ADVISED THAT THIS MATERIAL WAS GENERALLY INSPECTED FOR APPEARANCE AND RECOGNITION OF UNITS; POSSIBLY ONE OR MORE UNITS WERE INSPECTED FOR DESIGNATION AS TO TYPE.'

ARTICLE 1 OF THE GENERAL SALE TERMS AND CONDITIONS OF THE CONTRACT PROVIDES THAT "IN NO CASE WILL FAILURE TO INSPECT CONSTITUTE GROUNDS FOR A CLAIM OR FOR THE WITHDRAWAL OF A BID AFTER OPENING.' WHERE A BIDDER, WHO IS COMPLETELY APPRISED OF SUCH AN EXPRESS INSPECTION RESTRICTION IN THE INVITATION AS WELL AS OF THE DISCLAIMER OF WARRANTY CLAUSE, SUBMITS A BID, EITHER WITHOUT MAKING ANY INSPECTION OR WITHOUT MAKING AN ADEQUATE OR THOROUGH INSPECTION, IT MUST BE CONCLUDED THAT ANY RISK INVOLVED IN THE FAILURE TO MAKE ADEQUATE INSPECTION LIES UPON THE BIDDER. 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. HAD YOU NOT BEEN WILLING TO ASSUME SUCH A RISK YOU SHOULD NOT HAVE SUBMITTED A BID IN THE FIRST INSTANCE, AND UNDER THE LAW THERE IS NO AUTHORITY FOR ANY RELIEF FROM THE CONTRACT WHICH AROSE UPON THE ACCEPTANCE OF YOUR BID.