B-151620, JUN. 14, 1963

B-151620, JUN. 14, 1963

TO THE PUBLIC PRINTER, GOVERNMENT PRINTING OFFICE:

BY LETTER DATED MAY 20, 1963, WITH ENCLOSURES, YOU REQUESTED OUR DECISION AS TO WHETHER THE EASTERN LITHOGRAPHING CORP. IS LIABLE UNDER CONTRACT NO. GP-34157-A FOR THE LOSS OF GOVERNMENT FURNISHED PROPERTY RESULTING FROM A FIRE AT THE CONTRACTOR'S PLANT.

YOU ADVISE THAT THE CONTRACTOR NOTIFIED THE GOVERNMENT PRINTING OFFICE THAT ITS PLANT, LOCATED AT 1011 WEST DIAMOND STREET, PHILADELPHIA, PENNSYLVANIA, WAS COMPLETELY DESTROYED BY FIRE ON JANUARY 1, 1963, AND THAT GOVERNMENT MATERIAL FOR USE ON SEVERAL JOBS UNDER THE CONTRACT WAS LOST. IN THAT CONNECTION, IT IS STATED IN YOUR LETTER THAT:

"BEFORE THE FIRE OCCURRED IN THE PLANT OF THIS CONTRACTOR WE HAD AWARDED THEM CONTRACTS FOR A NUMBER OF PRINTING AND BINDING JOBS. IN ACCORDANCE WITH OUR USUAL PROCEDURE WE HAD FORWARDED TO THEM QUANTITIES OF PAPER STOCK, NEGATIVES AND ORIGINAL COPY, ALL OF WHICH WERE TO BE USED IN CONNECTION WITH THE PERFORMANCE OF THE JOBS. SINCE ALL OF THIS MATERIAL WAS IN THE PLANT OF EASTERN LITHOGRAPHING CORPORATION AT THE TIME OF THE FIRE, IT HAS ALL BEEN DESTROYED. UNDER A TERM CONTRACT FOR THE PRINTING AND BINDING OF AIRCRAFT SPECIFICATIONS AND PROPELLER SPECIFICATIONS WHICH BEGAN ON AUGUST 1, 1962, AND WOULD EXPIRE ON JULY 31, 1963, WE HAD FORWARDED QUANTITIES OF GOVERNMENT PRINTING OFFICE PAPER TO BE USED IN THE PRODUCTION OF THESE JOBS. AT THE TIME OF THE FIRE THERE REMAINED IN THE CONTRACTOR'S PLANT AND ON HIS INVENTORY, 123,802 SHEETS OF PROPERTY NO. 82 WHICH HAS BEEN DESTROYED BY FIRE. IN ADDITION THE NEGATIVES FOR A NUMBER OF JOBS, AS WELL AS THE ORIGINAL MANUSCRIPT COPY, WERE DESTROYED. ORDER TO COMPLETE THE JOBS WHICH HAD BEEN AWARDED TO EASTERN LITHOGRAPHING CORP., IT WILL BE NECESSARY FOR THE GOVERNMENT PRINTING OFFICE TO MAKE ARRANGEMENTS TO HAVE NEW NEGATIVES MADE ON ALL OF THE JOBS ON WHICH THE NEGATIVES WERE DESTROYED. IF AND WHEN IT IS NECESSARY TO HAVE THE NEGATIVES REMADE THERE WILL BE A COST OF APPROXIMATELY $6,500.00 INVOLVED.'

ARTICLE 5 OF THE UNITED STATES GOVERNMENT PRINTING OFFICE CONTRACT TERMS NO. 1, MADE A PART OF CONTRACT NO. GP-34157-A, PROVIDES THAT:

"UNLESS OTHERWISE SPECIFIED, THE CONTRACTOR'S LIABILITY FOR LOSS OR DAMAGE TO GOVERNMENT PROPERTY IN HIS POSSESSION FOR USE IN CONNECTION WITH THE PERFORMANCE OF THE CONTRACT SHALL BE THAT OF THE BAILEE OF A MUTUAL BENEFIT BAILMENT.'

UNDER THIS PROVISION, THE CONTRACTOR WAS REQUIRED TO USE ORDINARY CARE AND DILIGENCE IN SAFEGUARDING THE GOVERNMENT'S PROPERTY, AND HE WAS ANSWERABLE FOR LOSSES RESULTING FROM FAILURE TO EXERCISE SUCH CARE. HOWEVER, THE CONTRACTOR WAS NOT LIABLE FOR LOSSES NOT OCCASIONED BY THE WANT OF SUCH CARE OR ORDINARY NEGLIGENCE OF HIMSELF OR HIS EMPLOYEES UNLESS HE HAD VIOLATED HIS CONTRACT. 8 AM.JUR.2D, BAILMENTS SECTION 206; CLARK V. UNITED STATES, 95 U.S. 539; BOYDEN V. UNITED STATES, 13 WALL. 17. AS BAILEE, THE CONTRACTOR WAS NOT LIABLE FOR LOSSES DUE TO AN INEVITABLE ACCIDENT WHERE HE EXERCISED THE REQUIRED DEGREE OF CARE DEMANDED BY THE NATURE OF THE GOODS BAILED. THE TEST OF ORDINARY CARE IS THAT WHICH ORDINARILY PRUDENT MEN, AS A CLASS, WOULD EXERCISE IN CARING FOR THEIR OWN PROPERTY UNDER LIKE CIRCUMSTANCES. 8 AM.JUR.2D, BAILMENTS SECTIONS 207, 208. WE FIND NOTHING IN THE RECORD BEFORE US WHICH WOULD INDICATE THAT THE LOSSES RESULTED FROM NEGLIGENCE OR THAT THE CONTRACTOR OR HIS EMPLOYEES FAILED TO EXERCISE ORDINARY CARE IN SAFEGUARDING THE GOVERNMENT'S PROPERTY. RATHER, IT APPEARS THAT THE FIRE WAS AN INEVITABLE ACCIDENT IN THAT IT STARTED IN AN ADJOINING BUILDING AND SPREAD SO RAPIDLY TO HIS PLANT THAT NOTHING COULD BE DONE TO SAVE THE CONTENTS OF THE PLANT.

IN VIEW THEREOF, AND THE DETERMINATION TO TERMINATE THE CONTRACT WITHOUT LIABILITY TO THE CONTRACTOR ON ACCOUNT OF AN UNFORESEEABLE CAUSE BEYOND THE CONTROL AND WITHOUT THE FAULT OR NEGLIGENCE OF THE CONTRACTOR, WE ARE OF THE OPINION THAT THE EASTERN LITHOGRAPHING CORP. IS NOT LIABLE FOR THE LOSSES OF GOVERNMENT PROPERTY BAILED TO IT UNDER CONTRACT NO. GP-34157-A. SEE 26 COMP. DEC. 70.