B-150659, APR. 22, 1963

B-150659: Apr 22, 1963

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INC.: REFERENCE IS MADE TO YOUR LETTER OF JANUARY 17. UNDER THE TERMS OF THE CONTRACT YOU WERE TO DELIVER 25 AIR CONDITIONERS IN ACCORDANCE WITH THE SCHEDULE SET OUT IN THE CONTRACT. ONE UNIT WAS TO BE PRODUCED AT YOUR PLANT READY FOR GOVERNMENT INSPECTION AND TESTS. THIS UNIT WHEN ACCEPTED WAS TO BE RETAINED AT YOUR PLANT AND TO BE SHIPPED AS THE FINAL PRODUCTION UNIT. FOUR UNITS WERE TO BE DELIVERED. THE REMAINDER OF THE UNITS WERE TO BE DELIVERED AT THE RATE OF 20 UNITS EACH 30 CALENDAR-DAY PERIOD THEREAFTER UNTIL COMPLETION. OR THE BALANCE OF 20 UNITS OUT OF THE TOTAL OF 25 UNITS WAS DUE BY MAY 15. IN THE EVENT OF DELAY IN DELIVERY LIQUIDATED DAMAGES WERE TO BE ASSESSED ON THE THREE INSTALLMENTS.

B-150659, APR. 22, 1963

TO THERM-AIR MANUFACTURING COMPANY, INC.:

REFERENCE IS MADE TO YOUR LETTER OF JANUARY 17, 1963, CONCERNING THE ALLEGEDLY IMPROPER ASSESSMENT OF LIQUIDATED DAMAGES FOR DELAY IN DELIVERY OF AIR CONDITIONERS UNDER CONTRACT NO. FA-2732, DATED DECEMBER 29, 1961.

UNDER THE TERMS OF THE CONTRACT YOU WERE TO DELIVER 25 AIR CONDITIONERS IN ACCORDANCE WITH THE SCHEDULE SET OUT IN THE CONTRACT, TIME TO BE COMPUTED FROM THE EFFECTIVE DATE OF NOTICE TO PROCEED, STATED AS JANUARY 15, 1962. ONE UNIT WAS TO BE PRODUCED AT YOUR PLANT READY FOR GOVERNMENT INSPECTION AND TESTS, AND BE ACCEPTED WITHIN 60 CALENDAR DAYS FROM THE EFFECTIVE DATE OF THE NOTICE TO PROCEED OR BY MARCH 16, 1962. THIS UNIT WHEN ACCEPTED WAS TO BE RETAINED AT YOUR PLANT AND TO BE SHIPPED AS THE FINAL PRODUCTION UNIT. FOUR UNITS WERE TO BE DELIVERED, F.O.B. DESTINATION, WITHIN 90 CALENDAR DAYS FROM EFFECTIVE DATE OF NOTICE TO PROCEED OR BY APRIL 15, 1962. THE REMAINDER OF THE UNITS WERE TO BE DELIVERED AT THE RATE OF 20 UNITS EACH 30 CALENDAR-DAY PERIOD THEREAFTER UNTIL COMPLETION, OR THE BALANCE OF 20 UNITS OUT OF THE TOTAL OF 25 UNITS WAS DUE BY MAY 15, 1962. IN THE EVENT OF DELAY IN DELIVERY LIQUIDATED DAMAGES WERE TO BE ASSESSED ON THE THREE INSTALLMENTS, AS FOLLOWS: (A) FIRST UNIT, $4 PER DAY; (B) 2ND INSTALLMENT, $16 PER DAY; AND (C) ALL INSTALLMENTS THEREAFTER, $54 PER DAY. THE CONTRACT CONTAINED THE USUAL PROVISIONS IN PARAGRAPH 11 OF GENERAL PROVISIONS AS AMENDED BY PARAGRAPH 37 OF SUPPLEMENTAL GENERAL PROVISIONS EXCUSING YOU FOR DELAYS BEYOND YOUR CONTROL AND WITHOUT YOUR FAULT OR NEGLIGENCE. ALSO, THE CONTRACT CONTAINED IN PARAGRAPH 12 OF THE GENERAL PROVISIONS THE USUAL PROVISIONS FOR RESOLVING DISPUTES OF FACT. THE CONTRACTING OFFICER'S FINDING OF FACT IN CONNECTION WITH DISPUTES OF FACT WAS TO BE FINAL AND CONCLUSIVE IN THE ABSENCE OF AN APPEAL TO THE HEAD OF THE AGENCY CONCERNED WITHIN 30 DAYS FROM THE DATE OF RECEIPT OF THE ADVERSE FINDINGS OF THE CONTRACTING OFFICER.

UNDER PARAGRAPH 27 OF THE SUPPLEMENTAL GENERAL PROVISIONS OF THE CONTRACT IT WAS PROVIDED THAT:

"AWARD INCREASES: IF THE INITIAL AWARD FOR ANY ITEM IN THIS INVITATION IS FOR A QUANTITY LESS THAN THE MAXIMUM QUANTITY ON WHICH THE BIDDER HAS SUBMITTED AN OFFER, THE GOVERNMENT MAY, FOR A SIXTY (60) DAY PERIOD FROM THE EFFECTIVE DATE OF THE NOTICE TO PROCEED ON THE INITIAL AWARD, INCREASE THE AWARD UP TO A CUMULATIVE TOTAL QUANTITY NOT IN EXCESS OF THE MAXIMUM QUANTITY WHICH THE BIDDER HAS OFFERED TO SUPPLY. DELIVERY OF THE QUANTITIES ORDERED UNDER AN AWARD INCREASE SHALL BE ACCOMPLISHED AT A RATE COMPATIBLE WITH AND SEQUENTIAL TO THE DELIVERY SCHEDULE ESTABLISHED FOR THE INITIAL QUANTITY ORDERED, EXCLUDING THE PROVISION FOR ANY INITIAL OR PREPRODUCTION UNITS. ALL OTHER PROVISIONS OF THE ORIGINAL CONTRACT SHALL BE EQUALLY APPLICABLE TO THE AWARD AS INCREASED.'

DELIVERY UNDER THE INITIAL ORDER WAS COMPLETED PRIOR TO MAY 15, 1962. ALTHOUGH THE 60-DAY PERIOD FROM THE EFFECTIVE DATE OF THE NOTICE TO PROCEED ON THE INITIAL AWARD, WHICH ENDED ON MARCH 15, 1962, WAS ABOUT TO EXPIRE, YOU EXTENDED FOR AN ADDITIONAL 30 DAYS, OR UP TO APRIL 15, 1962, THE GOVERNMENT'S OPTION TO INCREASE THE QUANTITIES INVOLVED. ON APRIL 6, 1962, OR 21 DAYS AFTER THE EXPIRATION OF THE ORIGINAL OPTION PERIOD, THE GOVERNMENT ORDERED AN ADDITIONAL FOUR AIR CONDITIONERS AT THE PRICE AGREED UPON BY THE PROVISIONS OF PARAGRAPH 26 OF SUPPLEMENTAL GENERAL PROVISIONS. IT WAS CONSIDERED BY THE GOVERNMENT THAT UNDER THE PROVISIONS OF PARAGRAPH II (D) OF SPECIAL INVITATION CONDITIONS YOU WERE TO BE ALLOWED 30 CALENDAR DAYS AFTER MAY 15, 1962, FOR DELIVERY OF THE ADDITIONAL QUANTITY ORDERED, THAT DATE BEING THE CONTRACT DELIVERY DATE FOR THE LAST 20 UNITS OF THE FIRST 25 UNITS ORDERED. THUS, DELIVERY OF THE FOUR UNITS WAS DUE BY JUNE 14, 1962. HOWEVER, THERE APPEARS TO HAVE BEEN A DELAY OF 41 DAYS IN DELIVERY FOR WHICH LIQUIDATED DAMAGES IN THE AMOUNT OF $2,214 WERE ASSESSED.

UNDER DATE OF DECEMBER 17, 1962, THE CONTRACTING OFFICER FURNISHED YOU WITH HIS ADVERSE FINDING OF FACT DENYING YOUR CLAIM FOR REMISSION OF LIQUIDATED DAMAGES. IT DOES NOT APPEAR THAT YOU APPEALED THIS FINDING TO THE ADMINISTRATOR OF THE FEDERAL AVIATION AGENCY AND THEREFORE UNDER THE TERMS OF THE CONTRACT THE FINDING INSOFAR AS IT PERTAINS TO DISPUTES OF FACT MUST GENERALLY BE ACCEPTED AS FINAL AND CONCLUSIVE. HAPPEL V. UNITED STATES, 176 F.SUPP. 787; B. H. DEACON CO., INC. V. UNITED STATES, 189 F.SUPP. 146. THE MATTER CONCERNS A DISPUTE AS TO THE INTERPRETATION OF THE TERMS OF THE CONTRACT AS TO THE TIME ALLOWED FOR THE DELIVERY OF THE FOUR ADDITIONAL UNITS WHICH IS A QUESTION OF LAW. HOWEVER, WE FIND NO BASIS FOR DISAGREEING WITH THE CONTRACTING OFFICER'S INTERPRETATION OF SUCH TERMS AND AS TO WHICH YOU WERE FULLY INFORMED IN HIS LETTER OF DECEMBER 17, 1962.

UNDER THE PROVISIONS OF 41 U.S.C. 256A THE COMPTROLLER GENERAL, UPON THE RECOMMENDATION OF THE HEAD OF ANY FEDERAL AGENCY, MAY REMIT ALL, OR PART, AS HE CONSIDERS JUST AND EQUITABLE, OF ANY LIQUIDATED DAMAGES ASSESSED FOR DELAY IN PERFORMING A CONTRACT. PURSUANT TO THESE PROVISIONS IT HAS BEEN RECOMMENDED ON BEHALF OF THE ADMINISTRATOR, FEDERAL AVIATION AGENCY, THAT THE AMOUNT OF $1,134 ASSESSED AS LIQUIDATED DAMAGES BE REMITTED. VIRTUE OF THE AUTHORITY VESTED IN ME BY THE AFORESAID PROVISIONS AND IN ACCORDANCE WITH THE ADMINISTRATIVE RECOMMENDATION, I HAVE APPROVED THE REMISSION OF THE AMOUNT RECOMMENDED.