B-153866, MAY 19, 1964

B-153866: May 19, 1964

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TO CHEMICAL SERVICE CORPORATION: REFERENCE IS MADE TO YOUR LETTERS DATED MARCH 20 AND 25. AMONG OTHER DESCRIPTIVE DETAILS SET FORTH FOR ITEM NO. 12 WAS THAT IT WAS "ELBA SOLVENT. " THE TRADE NAME FOR 1 PART ETHYL LACTATE TO 2 PARTS BUTYL ACETATE AND THAT ITS CHEMICAL ANALYSIS WAS AS FOLLOWS: CHART "VOLATILE CONTENT. ITS CONDITION WAS CLEARLY DESCRIBED AS "USED.'. YOUR BID WHICH WAS THE HIGHEST BID RECEIVED WAS ACCEPTED BY THE GOVERNMENT CONTRACTING OFFICER ON AUGUST 30. YOU ALLEGED THAT AN ESSAY TEST OF A COMPOSITE SAMPLE OF ALL 104 DRUMS HAD BEEN MADE AND THAT TEST INDICATED THAT "THERE IS PRACTICALLY NO ETHYL LACTATE CONTAINED" AND "THERE IS A YIELD OF ROUGHLY 60 PERCENT SOLVENT. ALL OF WHICH IS BUTYL ACETATE.'.

B-153866, MAY 19, 1964

TO CHEMICAL SERVICE CORPORATION:

REFERENCE IS MADE TO YOUR LETTERS DATED MARCH 20 AND 25, 1964, REQUESTING REVIEW OF OUR SETTLEMENT DATED MARCH 18, 1964, DISALLOWING YOUR CLAIM FOR $2,626.04 REPRESENTING REFUND OF THE PURCHASE PRICE, STORAGE AND SHIPPING CHARGES FOR A QUANTITY OF SOLVENT PURCHASED FROM THE DEFENSE SURPLUS SALES OFFICE, FORT HOLABIRD, MARYLAND, PURSUANT TO CONTRACT NO. DSA-15-S-2206, DATED AUGUST 30, 1963.

IN RESPONSE TO SALES INVITATION NO. 15-8-64-9, ISSUED AUGUST 5, 1963, BY DEFENSE SURPLUS SALES OFFICE, BALTIMORE, MARYLAND, A SEALED BID SALE WITH INSPECTION PERIOD RUNNING FROM AUGUST 6, 1963, UNTIL TIME OF BID OPENING, YOU SUBMITTED A BID DATED AUGUST 22, 1963, ACCOMPANIED BY THE REQUIRED BID DEPOSIT IN THE FORM OF A CERTIFIED CHECK FOR $420, OFFERING TO PURCHASE ITEM 12 COVERING APPROXIMATELY 5,200 GALLONS OF ELBA SOLVENT FOR $2,091.54. AMONG OTHER DESCRIPTIVE DETAILS SET FORTH FOR ITEM NO. 12 WAS THAT IT WAS "ELBA SOLVENT," THE TRADE NAME FOR 1 PART ETHYL LACTATE TO 2 PARTS BUTYL ACETATE AND THAT ITS CHEMICAL ANALYSIS WAS AS FOLLOWS:

CHART

"VOLATILE CONTENT--- 99.07 PERCENT

0.36 PERCENT MOISTURE

98.715 BUTYL ACETATE AND ETHYL LACTATE (APPROXIMATE RATIO OF 2 PTS. BUTYL ACETATE TO 1 PT. ETHYL LACTATE)

NON-VOLATILE CONTENT--- 0.93 PERCENT

0.10 PERCENT NITROGLYCERIN

0.04 PERCENT 2-NITRODIPHENYLAMINE

0.79 PERCENT OTHER POWDER, TAPE AND FOREIGN MATTER COMPONENTS.'

THE ITEM HAD AN ESTIMATED GROSS WEIGHT INCLUDING DRUMS OF 45,280 POUNDS. ITS CONDITION WAS CLEARLY DESCRIBED AS "USED.' YOUR BID WHICH WAS THE HIGHEST BID RECEIVED WAS ACCEPTED BY THE GOVERNMENT CONTRACTING OFFICER ON AUGUST 30, 1963. BY LETTER DATED OCTOBER 29, 1963, YOU ALLEGED THAT AN ESSAY TEST OF A COMPOSITE SAMPLE OF ALL 104 DRUMS HAD BEEN MADE AND THAT TEST INDICATED THAT "THERE IS PRACTICALLY NO ETHYL LACTATE CONTAINED" AND "THERE IS A YIELD OF ROUGHLY 60 PERCENT SOLVENT, ALL OF WHICH IS BUTYL ACETATE.' THE LETTER ALSO SUGGESTS THE POSSIBILITY THAT THE WRONG PROPERTY WAS RELEASED. BY LETTER OF NOVEMBER 7, 1963, THE SALES CONTRACTING OFFICER REQUESTED THE PROPERTY DISPOSAL OFFICER, U.S. NAVAL PROPELLANT PLANT, TO FURNISH INFORMATION ON THE U.S. NAVY ANALYSIS OF THE PROPERTY AND ALSO WHETHER YOU HAD REQUESTED A SAMPLE PRIOR TO BIDDING. LETTER OF NOVEMBER 21, 1963, THE SUPPLY OFFICER, U.S. NAVAL PROPELLANT PLANT, STATED THAT A CHEMICAL EXAMINATION, NO. QCL-628-63, WAS MADE ON USED ELBA SOLVENT REPRESENTATIVE OF WHAT WAS DELIVERED AS ITEM NO. 12, INVITATION FOR BIDS NO. 15-S-64-9. THE CHEMICAL TEST INDICATED THAT THE QUANTITIES OF ETHYL LACTATE AND BUTYL ACETATE WERE APPROXIMATELY AS ADVERTISED. FURTHER RECORDS INDICATE THAT YOU DID NOT INSPECT THE PROPERTY OR REQUEST A SAMPLE OF THE PROPERTY PRIOR TO BIDDING. IN YOUR LETTER DATED DECEMBER 12, 1963, TO THIS OFFICE, SETTING FORTH YOUR CLAIM, HOWEVER, YOU REFER TO SAMPLES RECEIVED ON PRIOR OFFERINGS OF THE SAME MATERIAL, WHICH APPARENTLY CONFORMED TO THE ADVERTISED APPROXIMATE CHEMICAL COMPOSITION. FURTHER, IT IS RECORDED THAT DURING THE PROPERTY DELIVERED AS ITEM NO. 12 WAS THE SAME PROPERTY AVAILABLE DURING THE INSPECTION PERIOD. POSSIBLY YOU FAILED TO INSPECT THE PROPERTY UNDER THE PRESENT OFFERING BECAUSE THE SAMPLES RECEIVED BY YOU ON PRIOR OFFERINGS CONFORMED TO YOUR SATISFACTION.

ARTICLE 1 OF THE GENERAL SALE TERMS AND CONDITIONS INVITED, URGED AND CAUTIONED BIDDERS TO INSPECT THE PROPERTY PRIOR TO SUBMITTING A BID. ARTICLE 2 OF THE SAME GENERAL SALE TERMS AND CONDITIONS, WHICH WAS INCORPORATED AND MADE A PART OF CONTRACT NO. DSA-15-S-2206, EXPRESSLY SETS FORTH THE DETAILED CONDITIONS OF THE DISCLAIMER OF WARRANTY CLAUSE AND YOU FULLY AGREED TO THE WRITTEN TERMS THEREOF.

WHILE ORDINARILY IN THE SALE OF PERSONAL PROPERTY BY DESCRIPTION THERE IS AN IMPLIED WARRANTY THAT THE PROPERTY WILL CORRESPOND WITH THE DESCRIPTION, NO SUCH WARRANTY MAY BE IMPLIED WHERE, AS HERE, THE SALES CONTRACT CONTAINS AN EXPRESS DISCLAIMER. MOREOVER, THE GOVERNMENT IN DISPOSING OF ITS SURPLUS PROPERTY IS NOT ENGAGED IN NORMAL TRADE AND FREQUENTLY IS NOT AWARE OF THE TRUE DESCRIPTION OF THE GOODS IT SELLS. LAMBRAZO V. WOODRUFF, 175 N.E. 525; UNITED STATES V. KELLY, 112 F.SUPP. 831; I. SHAPIRO AND CO. V. UNITED STATES, 66 CT.CL. 424; AND MAGUIRE AND CO. V. UNITED STATES, 273 U.S. 67. THESE CASES AND OTHERS CONCLUDE THAT UNDER SUCH PROVISIONS, 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. ALSO, THE COURTS HAVE 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; AND AMERICAN SANITARY RAG CO. V. UNITED STATES 142 CT.CL. 293.

THERE IS NO EVIDENCE IN THE RECORD OF WILLFUL MISREPRESENTATION OR OF BAD FAITH ON THE PART OF THE GOVERNMENT. IT DOES NOT APPEAR THAT THE OFFICER IN CHARGE OF THE SALE KNEW THAT THE MATERIAL WAS NOT AS DESCRIBED. THE DESCRIPTION OF ITEM NO. 12, INVITATION FOR BIDS NO. 15 S-64-9, WAS PREPARED FROM THE BEST INFORMATION AVAILABLE. THE DESCRIPTION IN THE SALES CATALOG WAS THE SAME AS CONTAINED IN THE U.S. NAVAL PROPELLANT PLANT SURPLUS PROPERTY LISTING.

THE RULE ESTABLISHED BY THE DECISIONS OF THIS OFFICE IS THAT WHERE A BIDDER FAILS TO MAKE INSPECTION UNDER SUCH A CONTRACT OF SALE--- WHETHER SUCH FAILURE WAS DUE TO THE BIDDER'S OPINION THAT INSPECTION WAS NOT NECESSARY OR WHETHER THE INSPECTION WAS IMPRACTICAL, IF NOT IMPOSSIBLE--- THE BIDDER HAS ELECTED TO ASSUME ANY RISK WHICH MIGHT EXIST BY REASON OF A VARIANCE BETWEEN THE DESCRIPTION OF THE PROPERTY SET FORTH IN THE INVITATION AND THE PROPERTY ACTUALLY DELIVERED. THE BIDDERS' RESPONSIBILITIES IN THIS CONNECTION APPEAR TO BE CLEARLY SET FORTH IN PAXTON-MITCHELL COMPANY V. UNITED STATES, 172 F.SUPP. 463, WHERE IT WAS HELD THAT IT IS INCUMBENT UPON THE BIDDER TO MAKE THE SORT OF INSPECTION THAT IS EFFECTUAL.

THE LAW IS CLEAR THAT WHERE SURPLUS PROPERTY IS OFFERED FOR SALE BY THE GOVERNMENT ON AN "AS S" AND "WHERE IS" BASIS, WITHOUT A WARRANTY OR GUARANTY OF ANY KIND, AS IN THE INSTANT SALE, A BIDDER WHO FAILS TO TAKE ADVANTAGE OF AN OPPORTUNITY TO INSPECT CANNOT SUBSEQUENTLY RECOVER ON THE GROUNDS THAT THE MATERIALS ARE OF AN INFERIOR QUALITY OR THAT THEY ARE SOMETHING OTHER THAN WHAT HE THOUGHT HE WAS BUYING. AMERICAN SANITARY RAG CO. V. UNITED STATES, 161 F.SUPP. 414.

IN THE CIRCUMSTANCES THERE IS NO LEGAL BASIS FOR ALLOWING YOU ANY RELIEF AS TO ITEM NO. 12 ON SALES CONTRACT NO. DSA-15-S-2206 AND THE SETTLEMENT DATED MARCH 18, 1964, IS SUSTAINED.

RESPECTING YOUR REQUEST TO BE INFORMED OF THE ACTION AVAILABLE TO YOU IN THE EVENT OUR REVIEW IS UNFAVORABLE TO YOUR CLAIM, THE UNITED STATES COURT OF CLAIMS HAS JURISDICTION TO CONSIDER AND DETERMINE CONTRACT CLAIMS AGAINST THE UNITED STATES IF FILED THERE "WITHIN SIX YEARS AFTER SUCH CLAIM FIRST ACCRUES.' 28 U.S.C. 2501. ALSO, THE DISTRICT COURTS OF THE UNITED STATES HAVE CONCURRENT JURISDICTION AS TO SUCH CLAIMS UNDER $10,000. 28 U.S.C. 1346 (A) (2).