B-143848, SEP. 15, 1960

B-143848: Sep 15, 1960

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AS YOU WERE ADVISED BY THE CONTRACTING OFFICER ON JULY 27. THERE IS NO PRIVITY OF CONTRACT BETWEEN THE GOVERNMENT AND A SUBCONTRACTOR UNDER A GOVERNMENT PRIME CONTRACT. THERE IS NO LEGAL OBLIGATION ON THE PART OF THE GOVERNMENT TO REIMBURSE SUBCONTRACTORS FOR LOSSES THEY MAY INCUR IN THE PERFORMANCE OF THEIR SUBCONTRACTS. CLAIMS AGAINST THE GOVERNMENT IS LIMITED TO THOSE CASES IN WHICH THERE IS A LEGALLY ENFORCEABLE OBLIGATION AGAINST THE GOVERNMENT. SINCE WE ARE NOT AWARE OF ANY OTHER AGENCY OF THE GOVERNMENT WHICH WOULD HAVE AUTHORITY TO ALLOW AND PAY YOUR CLAIM. WE ARE UNABLE TO ADVISE YOU OF ANY SOURCE.

B-143848, SEP. 15, 1960

TO SPACE CORPORATION:

YOUR LETTER DATED AUGUST 23, 1960, TPB: 808-563/1223, REQUESTS OUR ADVICE RELATIVE TO ACTION WHICH MAY BE TAKEN BY YOUR COMPANY TO OBTAIN AN EQUITABLE PRICE ADJUSTMENT REPRESENTING INCREASED COSTS INCURRED BY YOUR COMPANY IN PERFORMING A FIXED PRICE SUBCONTRACT WITH CONVAIR DIVISION, GENERAL DYNAMICS CORPORATION, THE PRIME CONTRACTOR UNDER CONTRACT NO. AF 33 (600) 36200.

AS YOU WERE ADVISED BY THE CONTRACTING OFFICER ON JULY 27, 1960, THERE IS NO PRIVITY OF CONTRACT BETWEEN THE GOVERNMENT AND A SUBCONTRACTOR UNDER A GOVERNMENT PRIME CONTRACT. CONSEQUENTLY, THERE IS NO LEGAL OBLIGATION ON THE PART OF THE GOVERNMENT TO REIMBURSE SUBCONTRACTORS FOR LOSSES THEY MAY INCUR IN THE PERFORMANCE OF THEIR SUBCONTRACTS. THE JURISDICTION OF THIS OFFICE IN PAYING, OR DIRECTING THE PAYMENT OF, CLAIMS AGAINST THE GOVERNMENT IS LIMITED TO THOSE CASES IN WHICH THERE IS A LEGALLY ENFORCEABLE OBLIGATION AGAINST THE GOVERNMENT. SINCE NO SUCH OBLIGATION TO YOUR COMPANY EXISTS, AND SINCE WE ARE NOT AWARE OF ANY OTHER AGENCY OF THE GOVERNMENT WHICH WOULD HAVE AUTHORITY TO ALLOW AND PAY YOUR CLAIM, WE ARE UNABLE TO ADVISE YOU OF ANY SOURCE, OTHER THAN THE PRIME CONTRACTOR, FROM WHICH YOUR LOSSES MIGHT BE RECOVERABLE.