B-145385, APR. 13, 1961

B-145385: Apr 13, 1961

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H. LUCKEY COMPANY: REFERENCE IS MADE TO YOUR LETTER OF MARCH 10. BIDS WERE SOLICITED ON 259 ITEMS OF SURPLUS GOVERNMENT PROPERTY. THE TWO OTHER BIDS RECEIVED ON THIS ITEM WERE IN THE AMOUNTS OF $157 AND $3.31. AWARD WAS MADE TO YOU AS THE HIGHEST BIDDER ON ITEM NO. 97 (CONTRACT NO. (41-698/-S-61-341) AND YOU SUBSEQUENTLY COMPLETED PAYMENT OF THE AMOUNT OF YOUR BID. AFTER AWARD AND BEFORE THE PROPERTY WAS DELIVERED. YOU REQUESTED KELLY AIR FORCE BASE TO CHECK AS TO WHETHER THE WASHER ASSEMBLIES COVERED BY ITEM NO. 97 WERE NO. THE FILE INCLUDES A STATEMENT BY A COMMODITY SPECIALIST THAT "INSPECTION SHOWED CONTAINERS AND PACKAGES WERE MARKED AS ADVERTISED AND SOME OF THE WASHERS WERE CHECKED AND FOUND TO BE P/N 677.'.

B-145385, APR. 13, 1961

TO L. H. LUCKEY COMPANY:

REFERENCE IS MADE TO YOUR LETTER OF MARCH 10, 1961, REQUESTING REVIEW OF GENERAL ACCOUNTING OFFICE SETTLEMENT DATED FEBRUARY 28, 1961, WHICH DISALLOWED YOUR CLAIM FOR REFUND OF THE AMOUNT OF $678.75 PAID BY YOU FOR SURPLUS PROPERTY PURCHASED FROM THE DEPARTMENT OF THE AIR FORCE, KELLY AIR FORCE BASE, TEXAS, UNDER INVITATION NO. 41-608-S-61 11 DATED SEPTEMBER 16, 1960.

BY THE INVITATION, BIDS WERE SOLICITED ON 259 ITEMS OF SURPLUS GOVERNMENT PROPERTY, INCLUDING ITEM NO. 97 WHICH COVERED ONE LOT OF WASHER ASSEMBLIES DESCRIBED AS FOLLOWS:

TABLE

"WASHER ASSY., VALVE SPRING, P/N 0235-134677, APPLICABLE

TO MODEL R-2800 AIRCRAFT ENGINE, APPROX. 5,430 EACH.

USED APPEARS FAIR, MIN.REP.REQ.

CODE 28B EST. GROSS WT. 550 POUNDS

TOT.ACQ. COST $6,787.50 BOXED, TAILGATED 1 LOT"

IN RESPONSE TO THE INVITATION, YOU SUBMITTED A BID OF $678.75 ON ITEM NO. 97. THE TWO OTHER BIDS RECEIVED ON THIS ITEM WERE IN THE AMOUNTS OF $157 AND $3.31. ON OCTOBER 14, 1960, AWARD WAS MADE TO YOU AS THE HIGHEST BIDDER ON ITEM NO. 97 (CONTRACT NO. (41-698/-S-61-341) AND YOU SUBSEQUENTLY COMPLETED PAYMENT OF THE AMOUNT OF YOUR BID. IT APPEARS THAT YOU DID NOT INSPECT THE PROPERTY BEFORE SUBMITTING YOUR BID.

AFTER AWARD AND BEFORE THE PROPERTY WAS DELIVERED, YOU REQUESTED KELLY AIR FORCE BASE TO CHECK AS TO WHETHER THE WASHER ASSEMBLIES COVERED BY ITEM NO. 97 WERE NO. P/N 0235-134677 AS ADVERTISED. THE FILE INCLUDES A STATEMENT BY A COMMODITY SPECIALIST THAT "INSPECTION SHOWED CONTAINERS AND PACKAGES WERE MARKED AS ADVERTISED AND SOME OF THE WASHERS WERE CHECKED AND FOUND TO BE P/N 677.' HOWEVER, IN YOUR LETTER OF NOVEMBER 17, 1960, TO KELLY AIR FORCE BASE, YOU STATED THAT YOU HAD RECEIVED APPROXIMATELY 5,430 WASHERS IN CARTONS MARKED P/N 134677 BUT WHICH CONTAINED P/N 44767 WASHERS AND YOU REQUESTED REFUND OF THE AMOUNT PAID BY YOU FOR THE WASHERS COVERED BY ITEM NO. 97, STATING THAT YOU COULD NOT USE WASHERS NO. P/N 44767.

A CHECK WAS MADE BY CARSWELL AIR FORCE BASE, TEXAS, AT THE REQUEST OF KELLY AIR FORCE BASE AND IN THE RESULTING REPORT IT IS STATED:

"A. SEVEN OF THE EIGHT CONTAINERS WERE UNOPENED.

"B. OUR INVESTIGATION REVEALED THAT P/N 134677 WAS HANDWRITTEN ON THE OUTSIDE OF EACH INSIDE PACKAGE AND OUTSIDE SHIPPING CONTAINER. P/N 44769G WAS ETCHED ON EACH WASHER.

"C. TSGT SHARP OPENED TWO OF THE UNOPENED CONTAINERS AND AFTER INSPECTING THE ITEM, FOUND THAT THE SAME CONDITION EXISTED.

"D. P/N 44769G IS INTERCHANGEABLE WITH P/N 134677 BUT IS AN INFERIOR GRADE OF METAL (SOFT).'

IT THUS APPEARS THAT THERE IS NO CONCLUSIVE SHOWING THAT ALL OF THE WASHERS DELIVERED TO YOU WERE NO. P/N 44767 OR NO. P/N 44769G. HOWEVER, EVEN IF ALL THE WASHERS PROVED TO BE NO. P/N 44767 OR NO. P/N 44769G INSTEAD OF NO. P/N 134677 AS ADVERTISED, THERE APPEARS NO LEGAL BASIS FOR ALLOWANCE OF YOUR CLAIM IN VIEW OF THE FACTS OF THIS MATTER AND THE SPECIFIC PROVISIONS OF THE INVITATION FOR BIDS.

PARAGRAPHS 1 AND 2 OF GENERAL SALE TERMS AND CONDITIONS INCLUDED IN THE INVITATION PROVIDED:

"1. INSPECTION.--- BIDDERS ARE INVITED AND URGED TO INSPECT THE PROPERTY TO BE SOLD PRIOR TO SUBMITTING BIDS. PROPERTY WILL BE AVAILABLE FOR INSPECTION AT THE PLACES AND TIMES SPECIFIED IN THE INVITATION. THE GOVERNMENT WILL NOT BE OBLIGATED TO FURNISH ANY LABOR FOR SUCH PURPOSE. IN NO CASE WILL FAILURE TO INSPECT CONSTITUTE GROUNDS FOR A CLAIM OR FOR THE WITHDRAWAL OF A BID AFTER OPENING.

"2. CONDITION OF PROPERTY.--- ALL PROPERTY LISTED HEREIN IS OFFERED FOR SALE "AS IS" AND ,WHERE IS," AND WITHOUT RECOURSE AGAINST THE GOVERNMENT. IF IT IS PROVIDED HEREIN THAT THE GOVERNMENT SHALL LOAD, THEN "WHERE IS" MEANS F.O.B. CONVEYANCE AT THE POINT SPECIFIED IN THE INVITATION. THE DESCRIPTION IS BASED ON THE BEST AVAILABLE INFORMATION, BUT 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; THIS IS NOT A SALE BY SAMPLE.'

IT IS DIFFICULT TO PERCEIVE HOW CLEARER OR MORE EXPLICIT LANGUAGE COULD HAVE BEEN USED TO APPRISE ALL PROSPECTIVE BIDDERS THAT THEY WERE CONTRACTING FOR THE PURCHASE OF LISTED MATERIALS AT THEIR OWN RISK. THE COURTS HAVE HELD REPEATEDLY THAT SUCH PROVISIONS CONSTITUTE AN EXPRESS DISCLAIMER OF WARRANTY. MAGUIRE AND COMPANY V. UNITED STATES, 273 U.S. 67; LUMBRAZO V. WOODRUFF, 175 N.E. 525; W. E. HEDGER COMPANY V. UNITED STATES, 52 F.2D 31, CERTIORARI DENIED, 284 U.S. 676. SEE, ALSO, LIPSHITZ AND COHEN V. UNITED STATES, 269 U.S. 90, WHEREIN AN AGENT FOR THE GOVERNMENT LISTED FOR SALE CERTAIN ITEMS OF JUNK LOCATED AT SEVERAL FORTS, SETTING FORTH THE WEIGHTS AND KINDS OF EACH ITEM. ALTHOUGH THE QUANTITIES ACTUALLY WERE ONLY APPROXIMATELY ONE-HALF OF THOSE SHOWN IN THE ADVERTISEMENT, THE PLAINTIFFS WERE HELD NOT TO HAVE ANY CAUSE OF ACTION SINCE, AS STATED BY THE SUPREME COURT, THE MENTIONING OF THE QUANTITIES "CANNOT BE REGARDED AS IN THE NATURE OF A WARRANTY, BUT MERELY AN ESTIMATE OF THE PROBABLE AMOUNTS IN REFERENCE TO WHICH GOOD FAITH ONLY COULD BE REQUIRED OF THE PARTY MAKING IT.'

THESE CASES AND OTHERS TOO NUMEROUS TO MENTION CONCLUDE THAT, UNDER SUCH CIRCUMSTANCES, BUYERS HAVE NO RIGHT TO EXPECT, HAVE NOTICE NOT TO EXPECT, AND CONTRACT NOT TO EXPECT ANY WARRANTIES WHATEVER. IN DISPOSING OF SURPLUS MATERIALS, THE GOVERNMENT IS NOT ENGAGED IN NORMAL TRADE AND FREQUENTLY IS NOT AWARE OF THE CONDITION OR THE QUANTITY OF THE GOODS IT SELLS. THAT FACT IS MADE KNOWN TO ALL BIDDERS BY THE TERMS OF THE CONTRACT WHEREBY THE PARTIES AGREE THAT THE RISK AS TO THE CONDITION AND THE QUANTITY OF THE MATERIAL SOLD IS ASSUMED BY THE PURCHASER AS ONE OF THE ELEMENTS OF THE BARGAIN. SEE 36 COMP. GEN. 612.

NO LEGAL RESPONSIBILITY WOULD ATTACH TO THE GOVERNMENT IN THE ABSENCE OF A SHOWING OF BAD FAITH ON THE PART OF THE DISPOSAL OFFICER OR HIS AGENTS. LIPSHITZ AND COHEN V. UNITED STATES, SUPRA. THERE IS NOTHING IN THE RECORD TO ESTABLISH THAT THE CONTRACTING OFFICER OR HIS AGENTS ACTED OTHER THAN IN GOOD FAITH THROUGHOUT THE TRANSACTION.

FOR THE REASONS ABOVE SET OUT, THE SETTLEMENT OF FEBRUARY 28, 1961, DISALLOWING YOUR CLAIM, ..END :