B-144071, OCT. 14, 1960

B-144071: Oct 14, 1960

Additional Materials:

Contact:

Edda Emmanuelli Perez
(202) 512-2853
EmmanuelliPerezE@gao.gov

 

Office of Public Affairs
(202) 512-4800
youngc1@gao.gov

TO THE SECRETARY OF THE NAVY: REFERENCE IS MADE TO A LETTER DATED SEPTEMBER 22. THE BID WAS ACCEPTED ON JUNE 16. RYAN ADVISED THE ASSISTANT CONTRACTING OFFICER THAT SINCE HE DISCOVERED THAT THE PROPELLER CONTAINED 15 PERCENT MANGANESE AND WAS NOT WHOLLY BRONZE. HE WAS REQUESTING THAT ITEM NO. 41 BE CANCELED FROM THE CONTRACT IN ORDER TO AVOID A REPORTED ESTIMATED LOSS OF $930. RYAN HAD STATED THAT HIS BID WAS BASED ON THE ASSUMPTION THE PROPELLER WAS BRASS. RATHER THERE IS FOR DETERMINATION THE QUESTION WHETHER THE PROPERTY SOLD WAS THAT WHICH WAS DESCRIBED IN THE SALES INVITATION. IT IS REPORTED THAT ITEM NO. 41 OF SALES INVITATION NO. SINCE THE PROPELLER WAS EXPRESSLY DESCRIBED IN THE INVITATION AS "MANGANESE BRONZE" THERE WOULD APPEAR TO BE NO BASIS FOR THE CONTENTION STATED IN MR.

B-144071, OCT. 14, 1960

TO THE SECRETARY OF THE NAVY:

REFERENCE IS MADE TO A LETTER DATED SEPTEMBER 22, 1960, WITH ENCLOSURES, FILE R11.2, FROM THE ASSISTANT CHIEF FOR PURCHASING, BUREAU OF SUPPLIES AND ACCOUNTS, REQUESTING OUR DECISION AS TO WHETHER ITEM NO. 41 MAY BE CANCELED FROM CONTRACT NO. N205-10006, IN VIEW OF THE CIRCUMSTANCES REPORTED IN THE MATTER.

IN RESPONSE TO SALES INVITATION NO. SL-147-60-205, ISSUED ON MAY 26, 1960, BY THE U.S. NAVAL STATION, NEW ORLEANS, LOUISIANA, MR. JOHN RYAN SUBMITTED A BID OFFERING TO PURCHASE, AMONG OTHERS, ITEM NO. 41, COVERING A SHIP'S PROPELLER--- ORIGINAL ACQUISITION COST $21,830--- FOR $6,145.99. IN REPLY TO A REQUEST FOR VERIFICATION, MR. RYAN AFFIRMED HIS BID PRICE FOR ITEM NO. 41 AND, THEREAFTER, THE BID WAS ACCEPTED ON JUNE 16, 1960, AS TO ITEMS NOS. 6, 8, 9, 16, 19 AND 41. BY LETTER DATED JULY 14, 1960, MR. RYAN ADVISED THE ASSISTANT CONTRACTING OFFICER THAT SINCE HE DISCOVERED THAT THE PROPELLER CONTAINED 15 PERCENT MANGANESE AND WAS NOT WHOLLY BRONZE, AS HE HAD BELIEVED, HE WAS REQUESTING THAT ITEM NO. 41 BE CANCELED FROM THE CONTRACT IN ORDER TO AVOID A REPORTED ESTIMATED LOSS OF $930. THE NEW ORLEANS NAVAL STATION ALSO ADVISED THAT MR. RYAN HAD STATED THAT HIS BID WAS BASED ON THE ASSUMPTION THE PROPELLER WAS BRASS.

THE QUESTION HERE PRESENTED DOES NOT APPEAR TO BE ONE OF AN ERROR IN BID. RATHER THERE IS FOR DETERMINATION THE QUESTION WHETHER THE PROPERTY SOLD WAS THAT WHICH WAS DESCRIBED IN THE SALES INVITATION. IN THIS REGARD, IT IS REPORTED THAT ITEM NO. 41 OF SALES INVITATION NO. SL-147-60- 205 DESCRIBED THE PROPERTY AS PROPELLER; SHIP, FOUR-BLADES, MANGANESE BRONZE, ETC. THEREFORE, SINCE THE PROPELLER WAS EXPRESSLY DESCRIBED IN THE INVITATION AS "MANGANESE BRONZE" THERE WOULD APPEAR TO BE NO BASIS FOR THE CONTENTION STATED IN MR. RYAN'S LETTER DATED JULY 14, 1960, THAT HE WAS UNAWARE THAT THE PROPELLER CONTAINED 15 PERCENT MANGANESE--- LATER SHOWN BY TEST TO BE ONLY APPROXIMATELY 5 PERCENT. FOR THE SAME REASON, THERE APPEARS NO BASIS FOR MR. RYAN'S ASSUMPTION THAT THE PROPELLER WAS A PARTICULAR KIND OF BRASS.

MOREOVER, THE NEW ORLEANS NAVAL STATION FURTHER REPORTS THAT A REPUTABLE LOCAL DEALER IN METALS TESTED A SAMPLE OF THE PROPELLER AND THE METALLIC COMPOSITION THEREOF WAS SHOWN TO BE APPROXIMATELY 60 PERCENT COPPER, 35 PERCENT ZINC, AND 5 PERCENT MANGANESE. ALSO, THE STATION ADVISED THAT THE ALLOY, FROM WHICH THE PROPELLER WAS MADE, COMPARES CLOSELY WITH "NAVY BRASS" WHICH ACTUALLY IS SIMILAR TO, AND COMPARES WITH, THE TRADE BRONZES ACCORDING TO THE STANDARDS MANUAL FOR COPPER AND COPPER BASE ALLOY MILL PRODUCTS. THUS, EVEN IF IT DEFINITELY WERE ESTABLISHED THAT THE METAL CONTENT OF THE PROPELLER DID VARY FROM THAT SHOWN IN THE DESCRIPTION ON THE INVITATION, THERE WOULD BE APPLICABLE THE PROVISIONS OF ARTICLE 2 OF THE GENERAL SALE TERMS AND CONDITIONS OF THE INVITATION. IT CONSISTENTLY HAS BEEN HELD BY THE COURTS AND OUR OFFICE THAT, IN THE ABSENCE OF BAD FAITH, SUCH AN EXPRESS DISCLAIMER OF WARRANTY, AS CONTAINED IN THE SAID ARTICLE 2, VITIATES ANY AND ALL WARRANTIES WHICH OTHERWISE MIGHT ARISE OUT OF A SALES TRANSACTION. 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 CT.CL. 151; AND I. SHAPIRO AND COMPANY V. UNITED STATES, 66 CT.CL. 424.

IT ALSO MIGHT BE STATED THAT WHILE NO ERROR IN BID, AS SUCH, APPEARS TO HAVE OCCURRED IN THE TRANSACTION, ANY MERIT WHICH OTHERWISE MIGHT HAVE BEEN FOR CONSIDERATION IN THIS REGARD WOULD BE NEGATED BY THE FACT THAT MR. RYAN'S BID WAS ACCEPTED ONLY AFTER HE WAS GIVEN THE OPPORTUNITY TO, AND DID, AFFIRM HIS BID AS TO ITEM NO. 41.

ACCORDINGLY, WE FIND NO LEGAL BASIS TO AUTHORIZE A CANCELLATION OF ITEM NO. 41 FROM CONTRACT NO. N205-10006.

OUR OFFICE HAS NO EQUITABLE AUTHORITY IN THE MATTER.