B-153210, APR. 9, 1964

B-153210: Apr 9, 1964

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GENERAL SERVICES ADMINISTRATION: REFERENCE IS MADE TO LETTER OF DECEMBER 19. IT IS STATED THAT THE PRIMARY PURPOSES OF THE REVISION TO PART 1-7 ARE (1) TO PROVIDE AN EXPANDED FRAMEWORK FOR USE IN PRESCRIBING OR REFERENCING CONTRACT CLAUSES AND (2) TO INCLUDE THEREIN THOSE CLAUSES HERETOFORE SET FORTH ONLY ON PRESCRIBED CONTRACT FORMS SUCH AS STANDARD FORM 23A. WE ARE ASKED TO COMMENT SPECIFICALLY ON WHETHER WE BELIEVE SUCH CLAUSES SHOULD BE SET FORTH IN THE TEXT OF THE FPR OR WHETHER THEY SHOULD BE SET FORTH ONLY ON THE STANDARD FORM. WE ARE NOT AWARE OF THE FACTORS CONSIDERED BY YOUR AGENCY IN DETERMINING THE NEED FOR INCLUDING THE CLAUSES APPEARING IN ANY STANDARD FORM IN THE TEXT OF THE FPR.

B-153210, APR. 9, 1964

TO THE ADMINISTRATOR, GENERAL SERVICES ADMINISTRATION:

REFERENCE IS MADE TO LETTER OF DECEMBER 19, 1963, FROM THE ASSISTANT GENERAL COUNSEL, REGULATIONS AND GENERAL LAW DIVISION, REQUESTING OUR COMMENTS ON PROPOSED CHANGES TO FEDERAL PROCUREMENT REGULATIONS (FPR) PART 1-7, CONTRACT CLAUSES, AND SECTIONS 1-1.315-3, 1-8.700-2, AND 1 16.103.

IT IS STATED THAT THE PRIMARY PURPOSES OF THE REVISION TO PART 1-7 ARE (1) TO PROVIDE AN EXPANDED FRAMEWORK FOR USE IN PRESCRIBING OR REFERENCING CONTRACT CLAUSES AND (2) TO INCLUDE THEREIN THOSE CLAUSES HERETOFORE SET FORTH ONLY ON PRESCRIBED CONTRACT FORMS SUCH AS STANDARD FORM 23A, GENERAL PROVISIONS (CONSTRUCTION CONTRACT). WITH RESPECT TO THOSE CLAUSES APPEARING ON STANDARD FORM 19, INVITATION, BID, AND AWARD (CONSTRUCTION, ALTERATION OR REPAIR), WE ARE ASKED TO COMMENT SPECIFICALLY ON WHETHER WE BELIEVE SUCH CLAUSES SHOULD BE SET FORTH IN THE TEXT OF THE FPR OR WHETHER THEY SHOULD BE SET FORTH ONLY ON THE STANDARD FORM.

WE ARE NOT AWARE OF THE FACTORS CONSIDERED BY YOUR AGENCY IN DETERMINING THE NEED FOR INCLUDING THE CLAUSES APPEARING IN ANY STANDARD FORM IN THE TEXT OF THE FPR. IN GENERAL, WE ARE INCLINED TO THE VIEW THAT WHERE USE OF A STANDARD FORM IS MADE MANDATORY BY REGULATION THE REPETITION OF ANY OF THE CLAUSES OF THE FORM IN THE REGULATIONS IS NOT ONLY UNNECESSARY, BUT MAY HAVE A TENDENCY TO CREATE CONFUSION. WE WOULD THEREFORE FAVOR THE INCLUSION IN A REGULATION ONLY OF SUCH CLAUSES AS ARE NOT MANDATORY.

WHILE WE RECOGNIZE THAT CHANGES IN THE LANGUAGE OF CURRENTLY PRESCRIBED CLAUSES ARE NOT WITHIN THE SCOPE OF THE REVISION IN QUESTION, WE TAKE THIS OPPORTUNITY TO REMIND YOU OF OUR DISAPPROVAL OF THE LANGUAGE OF THE "DISPUTES" CLAUSE PRESCRIBED BY SECTION 1-7.101-12 PURPORTING TO IMPUTE FINALITY TO A DECISION THEREUNDER "UNLESS DETERMINED BY A COURT OF COMPETENT JURISDICTION" TO HAVE BEEN IMPROPER. SEE OUR LETTER TO YOUR PREDECESSOR, B-135224, DATED MARCH 28, 1958, COPY ENCLOSED. WE CANNOT ACCEPT THE VALIDITY OF THIS PROVISION IF INTERPRETED TO AFFECT THE JURISDICTION OF THIS OFFICE TO REVIEW SUCH DECISIONS, AND BELIEVE THAT ITS USE CAN HAVE NO OTHER EFFECT THAN TO ENCOURAGE CONTROVERSY.

PROVISIONS FOR PRICE ADJUSTMENT FOR SUSPENSION, DELAY, OR INTERRUPTION OF WORK REFERRED TO IN SUBPART 1-7.605-1 (PAGE 56) ARE THE SAME AS PRESCRIBED IN SUBPART 1-7.602-1 OF THE CURRENT REGULATIONS. EXCEPT FOR CERTAIN DETAIL, NOT HERE RELEVANT, THE CURRENT SUBPART IS THE SAME AS THAT WHICH WAS APPROVED BY THIS OFFICE IN LETTER OF JANUARY 6, 1949, B-135224, TO YOUR PREDECESSOR, COPY ENCLOSED. HOWEVER, WE AGAIN CALL ATTENTION TO OUR RECOMMENDATION, ACCOMPANYING APPROVAL OF THE CLAUSE, THAT "IMPLEMENTING REGULATIONS REQUIRE THE CONTRACTING OFFICER TO MAINTAIN A RECORD OF ALL NEGOTIATIONS LEADING TO THE ADJUSTMENT, INCLUDING FINANCIAL AND COST DATA ADEQUATE TO SUPPORT ANY ADJUSTMENT MADE PURSUANT TO THE CLAUSE.' ON THE BASIS OF OUR AUDIT FINDINGS IN CERTAIN AREAS WE REPEAT THAT RECOMMENDATION.

OTHER THAN AS ABOVE INDICATED WE HAVE NO COMMENTS TO OFFER ON THE PROPOSED REVISIONS, WITHOUT PREJUDICE HOWEVER, TO OUR RIGHT TO TAKE SUCH ACTION WITH RESPECT THERETO, OR TO MAKE FURTHER RECOMMENDATIONS FOR CHANGES, AS OUR AUDIT WORK MAY INDICATE.