B-148207, JUN. 4, 1962

B-148207: Jun 4, 1962

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YOUR CLAIM IS BASED ON THE FAILURE OF THE DISPOSAL ACTIVITY TO PROPERLY CARRY OUT YOUR EXPLICIT SHIPPING INSTRUCTIONS FOR ITEMS 8 AND 29. WHICH WOULD HAVE BEEN REMOVED AT YOUR PLANT FROM THE PROPERTY PURCHASED AS ITEMS 8 AND 29. WOULD ALLEGEDLY HAVE WEIGHED APPROXIMATELY 1. WITH AN ALLEGED APPROXIMATE QUANTITY OF TIN OF 35 TO 45 PERCENT WHICH COULD HAVE BEEN SOLD FOR AN ALLEGED PRICE OF $0.40 PER POUND. THE CLAIM YOU PRESENT IS NOT FOR LOSS OF PROFIT BUT FOR LOSS OF REVENUE. YOUR CLAIM FAILS TO TAKE INTO ACCOUNT YOUR OPERATING COSTS AS WELL AS THE ADDITIONAL CARRIER CHARGES WHICH YOU WOULD HAVE INCURRED IF THE GOODS HAD BEEN SHIPPED VIA YOUR PLANT AND THE NONMETALLIC SUBSTANCES REMOVED FROM THE GOODS.

B-148207, JUN. 4, 1962

AARON FERER AND SONS COMPANY:

YOUR LETTER OF FEBRUARY 9, 1962, REQUESTS REVIEW OF OUR CLAIMS DIVISION SETTLEMENT DATED JANUARY 24, 1962, WHICH DISALLOWED YOUR CLAIM FOR $400 AND $303.17, OR A TOTAL OF $703.17, WHICH REPRESENTS CERTAIN LOSSES INCURRED IN CONNECTION WITH THE PURCHASE OF ITEMS 8 AND 29 AWARDED TO YOU ON MAY 26, 1961, IN A SURPLUS SALE UNDER INVITATION NO. 14-021-S-61-26, CONTRACT NO. DA/S) 14-021-AV-629. YOUR CLAIM IS BASED ON THE FAILURE OF THE DISPOSAL ACTIVITY TO PROPERLY CARRY OUT YOUR EXPLICIT SHIPPING INSTRUCTIONS FOR ITEMS 8 AND 29.

IN THE "SPECIAL INSTRUCTIONS TO BIDDERS" THE GOVERNMENT AGREED "TO LOAD F.O.B. CARRIER AS THE PURCHASER'S SHIPPING ORDERS MAY DIRECT.' YOU DIRECTED THAT ITEMS 8 AND 29 OF YOUR PURCHASE BE LOADED SEPARATELY AND SHIPPED TO ARMCO STEEL CORPORATION IN KANSAS CITY, MISSOURI, WITH A STOPOVER FOR PARTIAL UNLOADING BY YOUR COMPANY IN OMAHA, NEBRASKA. INADVERTENTLY, AND CONTRARY TO YOUR INSTRUCTIONS, THE SELLING INSTALLATION SHIPPED ALL OF THE PURCHASED GOODS DIRECTLY TO ARMCO STEEL CORPORATION.

YOU DEMAND $400 FOR PROFITS ALLEGEDLY LOST BECAUSE THE SOLDER, WHICH WOULD HAVE BEEN REMOVED AT YOUR PLANT FROM THE PROPERTY PURCHASED AS ITEMS 8 AND 29, WOULD ALLEGEDLY HAVE WEIGHED APPROXIMATELY 1,000 POUNDS, WITH AN ALLEGED APPROXIMATE QUANTITY OF TIN OF 35 TO 45 PERCENT WHICH COULD HAVE BEEN SOLD FOR AN ALLEGED PRICE OF $0.40 PER POUND.

THE CLAIM YOU PRESENT IS NOT FOR LOSS OF PROFIT BUT FOR LOSS OF REVENUE. YOUR CLAIM FAILS TO TAKE INTO ACCOUNT YOUR OPERATING COSTS AS WELL AS THE ADDITIONAL CARRIER CHARGES WHICH YOU WOULD HAVE INCURRED IF THE GOODS HAD BEEN SHIPPED VIA YOUR PLANT AND THE NONMETALLIC SUBSTANCES REMOVED FROM THE GOODS. MOREOVER, THE AMOUNT CLAIMED IS HIGHLY SPECULATIVE AND CONJECTURAL. YOU PRESENT NO PROOF WHATEVER OF HOW MUCH SOLDER WAS CONTAINED IN ITEMS 8 AND 29, NOR OF HOW MUCH TIN WAS CONTAINED IN THE INDEFINITE AMOUNT OF SOLDER. YOU SUBMIT NO PROOF OF EITHER A MARKET OR THE MARKET PRICE FOR THE SOLDER AT THE TIME OF SALE. YOU SUBMIT NO PROOF THAT THE COST OF REMOVING THE SOLDER FROM ITEMS 8 AND 29 WAS TAKEN INTO ACCOUNT IN YOUR CLAIM FOR THE VALUE OF THE SOLDER.

OUR OFFICE HAS NO FACILITIES WITH WHICH IT MIGHT ASCERTAIN WHAT AMOUNTS WOULD BE CONSIDERED FAIR AND REASONABLE AND IN THE CIRCUMSTANCES WOULD NOT BE LEGALLY JUSTIFIED IN ALLOWING ANY PORTION OF THIS ITEM OF YOUR CLAIM.

YOU ALSO DEMAND DAMAGES FOR LOSS OF PROFITS IN THE AMOUNT OF $303.17, ON THE GROUNDS THAT ARMCO STEEL CORPORATION WOULD NOT AND DID NOT ACCEPT THE TENDERED GOODS WITHOUT A REDUCTION IN YOUR SELLING PRICE BY THAT AMOUNT. YOU SUBMIT AS PROOF OF THIS LOSS A LETTER FROM ARMCO STEEL CORPORATION DATED NOVEMBER 8, 1961, TO THE EFFECT THAT YOUR SELLING PRICE TO THAT CORPORATION WAS REDUCED $5 PER GROSS TON. YOU ALLEGE THAT IF THE SHIPMENT HAD BEEN STOPPED AT YOUR PLANT THE SOLDER WHICH REDUCED THE VALUE OF THE GOODS, SO FAR AS ARMCO STEEL CORPORATION WAS CONCERNED, COULD HAVE BEEN REMOVED AS PLANNED.

WE RECOGNIZE THAT, TAKEN BY ITSELF, THIS CLAIM ALSO REPRESENTS A LOSS OF REVENUE RATHER THAN A LOSS OF PROFIT. HOWEVER, UNLIKE THE CLAIM FOR $400, THE AMOUNT HERE LOST HAS BEEN ASCERTAINED AND ESTABLISHED WITH A FAIR DEGREE OF CERTAINTY.

FOR THE REASONS DISCUSSED ABOVE, WE WILL GIVE FAVORABLE CONSIDERATION TO THE ALLOWANCE OF $303.17 AS FULL AND FINAL SETTLEMENT OF ALL AND ANY CLAIMS AGAINST THE GOVERNMENT ARISING OUT OF THE AFOREMENTIONED TRANSACTION, IF YOU WILL ADVISE US THAT YOU ARE WILLING TO ACCEPT SETTLEMENT ON THIS BASIS.