B-153535, MAR. 11, 1964

B-153535: Mar 11, 1964

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YOU WERE AWARDED ITEM NO. 34. THE BIDDER IS INVITED. PROPERTY WILL BE AVAILABLE FOR INSPECTION AT THE PLACES AND TIMES SPECIFIED IN THE INVITATION. IN NO CASE WILL FAILURE TO INSPECT CONSTITUTE GROUNDS FOR THE WITHDRAWAL OF A BID AFTER OPENING. "2. ALL PROPERTY LISTED THEREIN IS OFFERED FOR SALE "AS IS" AND "WHERE IS.'. IF IT IS PROVIDED THEREIN THAT THE GOVERNMENT SHALL LOAD. THEN "WHERE IS" MEANS F.O.B. THE DESCRIPTION IS BASED ON THE BEST AVAILABLE INFORMATION. NO REQUEST FOR ADJUSTMENT IN PRICE OR FOR RESCISSION OF THE SALE WILL BE CONSIDERED. THIS IS NOT A SALE BY SAMPLE.'. THE COURTS HAVE HELD THAT UNDER SUCH PROVISION. BUYERS HAVE NO RIGHT TO EXPECT. HAVE NOTICE NOT TO EXPECT.

B-153535, MAR. 11, 1964

TO L. LEIBOWITS WOOL STOCK CO., INC.:

YOUR LETTER OF FEBRUARY 5, 1964, REQUESTS REVIEW OF SETTLEMENT DATED FEBRUARY 3, 1964, WHICH DISALLOWED YOUR CLAIM FOR THE AMOUNT OF $601.12, REPRESENTING THE AMOUNT PAID FOR 283 POUNDS OF OBJECTIONABLE MATERIAL (COTTON, PAPER AND SEWINGS), AND THE COST OF REMOVING SUCH MATERIAL FROM A LOT OF SCRAP MATERIAL SOLD TO YOU UNDER INVITATION NO. 11-S-64-36 ISSUED BY THE DEFENSE SURPLUS SALES OFFICE, PHILADELPHIA NAVAL BASE, PHILADELPHIA, PENNSYLVANIA.

YOU WERE AWARDED ITEM NO. 34, DESCRIBED AS 14,510 POUNDS OF SCRAP CLIPPINGS, WOOL, TROPICAL WORSTED, KHAKI, BALED, ON THE BASIS OF YOUR HIGH BID OF ?4015 PER POUND, OR $5,825.77, WHICH YOU SUBMITTED WITHOUT FIRST INSPECTING THE PROPERTY. AFTER REMOVAL OF THE PROPERTY, YOU ALLEGED MISDESCRIPTION IN THAT THE MATERIAL CONTAINED A CONSIDERABLE AMOUNT OF PAPER, SEWING AND COTTON, WHICH YOU HAD TO REMOVE AT A COST OF $487.50.

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

"1. INSPECTION. THE BIDDER IS INVITED, URGED, AND CAUTIONED TO INSPECT THE PROPERTY TO BE SOLD PRIOR TO SUBMITTING A BID. PROPERTY WILL BE AVAILABLE FOR INSPECTION AT THE PLACES AND TIMES SPECIFIED IN THE INVITATION. IN NO CASE WILL FAILURE TO INSPECT CONSTITUTE GROUNDS FOR THE WITHDRAWAL OF A BID AFTER OPENING.

"2. CONDITION AND LOCATION OF PROPERTY. UNLESS OTHERWISE SPECIFICALLY PROVIDED IN THE INVITATION, ALL PROPERTY LISTED THEREIN IS OFFERED FOR SALE "AS IS" AND "WHERE IS.' IF IT IS PROVIDED THEREIN 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. HOWEVER, THE GOVERNMENT MAKES NO WARRANTY, EXPRESS 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. EXCEPT AS PROVIDED IN CONDITIONS NO. 8 AND 10, NO REQUEST FOR ADJUSTMENT IN PRICE OR FOR RESCISSION OF THE SALE WILL BE CONSIDERED. THIS IS NOT A SALE BY SAMPLE.'

THE COURTS HAVE HELD THAT UNDER SUCH PROVISION, IN THE ABSENCE OF BAD FAITH OR FRAUD, BUYERS HAVE NO RIGHT TO EXPECT, HAVE NOTICE NOT TO EXPECT, AND CONTRACT NOT TO EXPECT ANY WARRANTIES WHATEVER, THE PURPOSE AND EFFECT OF SUCH PROVISIONS BEING TO IMPOSE ALL RISKS OF MISTAKE UPON THE BUYER. THE COURTS HAVE ALSO HELD THAT AN EXPRESS DISCLAIMER OF WARRANTY AS USED IN SURPLUS PROPERTY SALES BY THE GOVERNMENT PRECLUDES A SUIT FOR DAMAGES ON THE THEORY OF MUTUAL MISTAKE. UNITED STATES V. HATHAWAY, 242 F.2D. 897; AMERICAN SANITARY RAG CO. V. UNITED STATES, 142 CT.CL. 293. ACCORDINGLY, WHILE THE DESCRIPTION MIGHT HAVE BEEN INACCURATE, THERE IS NO EVIDENCE THAT IT WAS NOT PREPARED IN GOOD FAITH, AND, THEREFORE, NO RELIEF MAY BE GRANTED BECAUSE OF THE VARIATION BETWEEN THE DESCRIPTION AND THE PROPERTY RECEIVED.

AS TO YOUR CONTENTION THAT PROPER INSPECTION IS NOT PERMITTED UNDER THE PROCEDURE FOLLOWED BY THE DISPOSAL ACTIVITY AND THAT PROSPECTIVE BUYERS MUST THEREFORE RELY ON THE DESCRIPTION IN THE INVITATION, THE RECORD SHOWS THAT THE PROCEDURE OF BALING THE PROPERTY IS THE SAME AS THAT FOLLOWED FOR SEVERAL YEARS PAST, DURING WHICH YOU HAVE BEEN THE SUCCESSFUL BIDDER ON ITEMS SIMILAR TO ITEM NO. 34. THE RECORD ALSO SHOWS THAT IT IS IMPOSSIBLE AND HIGHLY IMPRACTICAL TO COMPLETELY ELIMINATE OTHER TYPES OF MATERIAL AND FOREIGN MATTER AND THE PERCENTAGE OF FOREIGN MATTER PER BALE IS CONSIDERED NEGLIGIBLE. IT APPEARS, THEREFORE, THAT YOUR DIFFICULTY IN THIS CASE AROSE NOT FROM THE DEFICIENCY OF THE PROCEDURE FOLLOWED BY THE DISPOSAL ACTIVITY, BUT FROM YOUR FAILURE TO INSPECT THE PROPERTY PRIOR TO SUBMITTING YOUR BID.

IN CIRCUMSTANCES SUCH AS THESE, THE COURT HELD IN PAXTON-MITCHELL COMPANY V. UNITED STATES, 172 F.SUPP. 463 (1959), THAT EVEN THOUGH ADEQUATE OR THOROUGH INSPECTION BE IMPRACTICABLE, IF NOT IMPOSSIBLE, THE BIDDER WHO FAILS TO INSPECT ASSUMES ANY LOSS WHICH MIGHT RESULT FROM A VARIANCE BETWEEN THE PROPERTY DESCRIBED IN THE INVITATION AND THE PROPERTY DELIVERED, THE BIDDER BEING REQUIRED BY THE GOVERNMENT SALES CONTRACT TO MAKE THE SORT OF INSPECTION THAT IS EFFECTUAL.