B-154371, OCT. 13, 1964

B-154371: Oct 13, 1964

Additional Materials:

Contact:

Edda Emmanuelli Perez
(202) 512-2853
EmmanuelliPerezE@gao.gov

 

Office of Public Affairs
(202) 512-4800
youngc1@gao.gov

TO TIME OIL COMPANY AND WESTOIL TERMINALS COMPANY: REFERENCE IS MADE TO YOUR LETTERS OF JUNE 1 AND AUGUST 10. WERE INEFFECTIVE. WAS RENEWED BY MODIFICATION NO. 8. THE FOLLOWING OPTION PROVISION WAS INCORPORATED IN THE CONTRACT IN LIEU OF THE ONE PREVIOUSLY CONTAINED THEREIN: "SECTION X - OPTION TO RENEW "UPON AT LEAST NINETY (90) DAYS WRITTEN NOTICE BY THE GOVERNMENT PRIOR TO THE EXPIRATION DATE OF THIS CONTRACT. THE GOVERNMENT SHALL HAVE THE OPTION TO RENEW THIS CONTRACT. (WHICH IS STATED IN THE ADMINISTRATIVE REPORT SUBMITTED TO US IN THIS MATTER TO BE AN "AFFILIATE" OF TIME OIL COMPANY) AGREED TO FURNISH BULK PETROLEUM STORAGE FACILITIES IN THE TOTAL CAPACITY OF 173. WAS RENEWED BY MODIFICATION NO. 4.

B-154371, OCT. 13, 1964

TO TIME OIL COMPANY AND WESTOIL TERMINALS COMPANY:

REFERENCE IS MADE TO YOUR LETTERS OF JUNE 1 AND AUGUST 10, 1964, CONTENDING THAT CERTAIN ACTIONS TAKEN BY THE DEFENSE PETROLEUM SUPPLY CENTER AND/OR THE DEFENSE FUEL SUPPLY CENTER, WASHINGTON, D.C., PURPORTING TO EXTEND THE PERFORMANCE PERIOD OF CONTRACT NO. DSA 6-635, DATED JUNE 1, 1962, WITH WESTOIL TERMINALS COMPANY, FOR ONE YEAR THROUGH JUNE 30, 1965, AND TO OBLIGATE TIME OIL COMPANY TO FURNISH 195,000 BARRELS OF BULK PETROLEUM STORAGE AND THE DRUM AND FILING SERVICES REFERRED TO IN A TELEGRAM FROM THE DEFENSE FUEL SUPPLY CENTER TO TIME OIL COMPANY, BY A PARTIAL ACCEPTANCE OF THE CONCERN'S PROPOSAL SUBMITTED IN RESPONSE TO REQUEST FOR PROPOSAL NO. DSA 6-64-N-283, WERE INEFFECTIVE.

BY CONTRACT NO. DSA 6-634, DATED JUNE 1, 1962, NEGOTIATED WITH THE DEFENSE PETROLEUM SUPPLY CENTER, TIME OIL COMPANY AGREED TO FURNISH BULK PETROLEUM STORAGE FACILITIES IN THE TOTAL CAPACITY OF 145,000 BARRELS, HANDLING SERVICES AND DRUM STORAGE (MAXIMUM OF 450,000 GOVERNMENT-OWNED DRUMS), AND FILLING SERVICES (5,000 DRUMS PER 24-HOUR DAY) IN THE LOS ANGELES, CALIFORNIA, HARBOR AREA DURING THE PERIOD JULY 1, 1962, THROUGH JUNE 30, 1963, AT THE UNIT PRICES STIPULATED THEREIN. THE CONTRACT, AS SUBSEQUENTLY AMENDED, WAS RENEWED BY MODIFICATION NO. 8, EFFECTIVE MAY 10, 1963, FOR THE PERIOD JULY 1, 1963, THROUGH JUNE 30, 1964, PURSUANT TO THE OPTION PROVISION CONTAINED IN THE ORIGINAL CONTRACT. BY MODIFICATION NO. 8, THE FOLLOWING OPTION PROVISION WAS INCORPORATED IN THE CONTRACT IN LIEU OF THE ONE PREVIOUSLY CONTAINED THEREIN:

"SECTION X - OPTION TO RENEW

"UPON AT LEAST NINETY (90) DAYS WRITTEN NOTICE BY THE GOVERNMENT PRIOR TO THE EXPIRATION DATE OF THIS CONTRACT, THE GOVERNMENT SHALL HAVE THE OPTION TO RENEW THIS CONTRACT, FOR ONE YEAR THROUGH 30 JUNE 1965 ON THE SAME TERMS AND CONDITIONS PROVIDED HOWEVER, THAT THE CHARGES TO BE PAID DURING ANY RENEWAL PERIOD MAY BE ADJUSTED UPWARD TO REFLECT SUPPORTABLE INCREASE IN CONTRACTOR'S LABOR RATES DIRECTLY ATTRIBUTABLE TO THE SERVICES FURNISHED HEREUNDER AND PROVIDED ANY SUCH ADJUSTMENT SHALL BE DETERMINED AT THE TIME OF RENEWAL BASED UPON ANY LABOR RATE INCREASE OCCURRING SINCE 30 JUNE 1963. WITHIN 90DAYS AFTER FINAL EXECUTION OF THIS CONTRACT, THE CONTRACTOR SHALL PROVIDE THE CONTRACTING OFFICER WITH A SCHEDULE OF LABOR RATES FOR ALL OPERATING PERSONNEL EMPLOYED IN PERFORMING SERVICES UNDER THIS CONTRACT AS OF 30 JUNE 1963.'

BY CONTRACT NO. DSA 6-635, DATED JUNE 1, 1962, NEGOTIATED WITH THE DEFENSE PETROLEUM SUPPLY CENTER, WESTOIL TERMINALS COMPANY, (WHICH IS STATED IN THE ADMINISTRATIVE REPORT SUBMITTED TO US IN THIS MATTER TO BE AN "AFFILIATE" OF TIME OIL COMPANY) AGREED TO FURNISH BULK PETROLEUM STORAGE FACILITIES IN THE TOTAL CAPACITY OF 173,286 BARRELS AND HANDLING SERVICES IN THE LOS ANGELES HARBOR AREA DURING JULY 1, 1962, THROUGH JUNE 30, 1963, AT THE UNIT PRICES STIPULATED THEREIN. THE CONTRACT, AS SUBSEQUENTLY AMENDED, WAS RENEWED BY MODIFICATION NO. 4, EFFECTIVE JULY 1, 1963, FOR THE PERIOD JULY 1, 1963, THROUGH JUNE 30, 1964, PURSUANT TO THE OPTION PROVISION CONTAINED IN THE ORIGINAL CONTRACT. BY MODIFICATION NO. 4, AN OPTION PROVISION IDENTICAL TO THAT QUOTED ABOVE WAS INCORPORATED IN THE CONTRACT IN LIEU OF THE ONE PREVIOUSLY CONTAINED THEREIN.

IT APPEARS FROM THE REPORT SUBMITTED BY THE CONTRACTING OFFICER IN CONNECTION WITH THIS MATTER (A COPY OF WHICH WAS FURNISHED TO MR. FRENCH AS YOUR ATTORNEY BY OUR LETTER OF JUNE 30, 1964), AND FROM RECORDS FURNISHED TO US IN SUPPORT THEREOF, THAT ON MARCH 16, 1964, THE DEFENSE FUEL SUPPLY CENTER (DFSC) RECEIVED FROM THE U.S. ARMY PETROLEUM CENTER A REQUIREMENT FOR FACILITIES AND SERVICES SIMILAR TO THOSE PROVIDED FOR UNDER THE ABOVE CONTRACTS, TO BE SUPPLIED DURING THE FISCAL YEAR 1965. THE REQUIREMENT WAS FOR A MAXIMUM OF 445,000 BARRELS (SUBSEQUENTLY REDUCED TO 370,000 BARRELS) OF BULK PETROLEUM STORAGE, FOR RECEIVING AND SHIPPING 55-57 GALLON DRUMS, FOR STORAGE OF 153,000 DRUMS, AND FOR FILLING DRUMS AT A MINIMUM RATE OF 27,500 PER 24-HOUR DAY. THE FACILITIES AND SERVICES WERE TO BE SUPPLIED IN EITHER THE LOS ANGELES HARBOR AREA OR THE SAN FRANCISCO HARBOR AREA.

A "MEMORANDUM FOR RECORD," "SUBJECT: CONTRACT DSA 6-635," PREPARED BY FRANCIS J. DIFABIO (A DFSC BUYER) UNDER DATE OF MARCH 17, 1964, REFERS TO THE FACT THAT UNDER THE TERMS OF THE CONTRACT THE RENEWAL OPTION WAS REQUIRED TO BE EXERCISED NOT LATER THAN APRIL 1, 1964, AND STATES:

"A TELEPHONE CALL WAS MADE TO WESTOIL TERMINALS AND I CONTACTED MR. FRENCH. I ASKED HIM FOR AN EXTENSION OF THE OPTION AND HE STATED THAT HE WOULD CHECK AND LET ME KNOW THIS WEEK. I FURTHER ASKED FOR AN EXTENSION UNTIL 1 JUNE AND HE STATED THAT HE DOUBTED THAT HE COULD GIVE ME SUCH A LENGTHY EXTENTION.'

A MEMORANDUM FOR THE RECORD PREPARED BY MR. DIFABIO UNDER DATE OF MARCH 25, 1964,"SUBJECT: TELECON WITH MR. FRENCH, THIS DATE," REFERS TO THE TELEPHONE CONVERSATION OF MARCH 17, DOCUMENTED ABOVE, AND STATES:

"MR. FRENCH CALLED 25 MARCH 1964 AND ADVISED THAT HE WAS ABLE TO REDUCE THE OPTION PERIOD BY 20 DAYS SO THAT THE OPTION MUST BE EXERCISED NOT LATER THAN 20 APRIL 1964. I ASKED HIM FOR ADDITIONAL TIME BUT HE STATED THAT HE WAS UNABLE TO GIVE ME MORE THAN 20 DAYS. MR. FRENCH STATED THAT HE REQUIRED AT LEAST 90 DAYS SO THAT IN THE EVENT WE DID NOT EXERCISE THE OPTION HE WOULD HAVE TIME TO PUT THE TANKAGE INTO OTHER USE. HE AGREED TO SEND A TELEGRAM CONFIRMING THIS EXTENSION OF TIME. MR. FRENCH ALSO ADVISED ME THAT CONTRACT DSA 6-634 WITH TIME OIL CO. ALSO CONTAINED A 90 DAY OPTION PROVISION. THIS I WAS NOT AWARE OF. A CHECK OF THE CONTRACT FILE INDICATES THAT THE CONTRACT DID CONTAIN A 90 DAY OPTION PROVISION. MR. FRENCH AGREED TO GIVE US UNTIL THE 20TH OF APRIL 1964 TO EXERCISE THE OPTION UNDER THIS CONTRACT.

"CONTRACT DSA 6-634 IS HANDLED BY CODE FT. I DISCUSSED THE ABOVE OPTION EXTENSION WITH MR. JETT AND MR. CARAWAN.'

UNDER DATE OF MARCH 25, 1964, THE FOLLOWING TELEGRAM, SIGNED "W G FRENCH TIME OIL CO," WAS SENT TO FRANCIS DIFABIO, DEFENSE FUEL SUPPLY CENTER, WASHINGTON, D.C.:

"PER YOUR REQUEST WE EXTEND YOUR OPTION ON CONTRACTS DSA 6-634 AND DSA 6- 635 TO APRIL 20TH"

REQUEST FOR PROPOSAL NO. DSA 6-64-N-283, SETTING FORTH THE TOTAL REQUIREMENTS OF THE U.S. ARMY PETROLEUM CENTER FOR FISCAL YEAR 1965, AS ABOVE ENUMERATED, WAS ISSUED BY THE DEFENSE FUEL SUPPLY CENTER ON MARCH 31, 1964, TO 103 PROSPECTIVE SUPPLIERS, THE PROPOSALS TO BE RECEIVED UNTIL THE CLOSE OF BUSINESS APRIL 16, 1964. PROSPECTIVE SUPPLIERS WERE ADVISED IN THE RFP THAT IT WAS THE GOVERNMENT'S PREFERENCE TO AWARD ONE CONTRACT FOR ALL THE SERVICES REQUIRED TO BE PERFORMED IN ONE TERMINAL SYSTEM, BUT AWARD WOULD BE MADE TO THE LOWEST "OFFERORS/S)" WHO CONFORMED TO THE AREA REQUIREMENTS (THE SERVICES AND FACILITIES TO BE FURNISHED UNDER ANY CONTRACT TO BE NEGOTIATED WERE REQUIRED TO BE MET IN EITHER THE LOS ANGELES - LONG BEACH - WILMINGTON SEAL BEACH, CALIFORNIA, AREA, OR THE SAN FRANCISCO - OAKLAND - RICHMOND, CALIFORNIA, AREA) OF THE RFP AND COULD PERFORM AT LEAST THE MINIMUM QUANTITIES OF REQUIRED SERVICES; ALSO, THEY WERE ADVISED THAT OFFERS WERE REQUESTED FOR A ONE-YEAR FIRM CONTRACT FOR THE PERIOD JULY 1, 1964, THROUGH JUNE 30, 1965, WITH THREE GOVERNMENT OPTIONS TO RENEW FOR ONE YEAR EACH AT THE SAME TERMS, CONDITIONS AND RATES AS THOSE SET FORTH FOR THE INITIAL CONTRACT PERIOD. HOWEVER, PROPOSALS RECEIVED WHICH OFFERED LOWER CHARGES AFTER THE INITIAL CONTRACT PERFORMANCES WERE TO BE EVALUATED ON THE BASIS OF THE TOTAL FOUR-YEAR PERIOD.

PARAGRAPH 1 OF THE "TERMS AND CONDITIONS OF REQUEST FOR PROPOSAL" (STANDARD FORM DD746) PROVIDED THAT THE GOVERNMENT RESERVED THE RIGHT TO MAKE AN AWARD ON ANY ITEM FOR A QUANTITY LESS THAN THE QUANTITY PROPOSED AT THE UNIT PRICE OFFERED UNLESS THE OFFEROR SPECIFIED OTHERWISE IN ITS PROPOSAL. ALSO, PARAGRAPH 25 THEREOF PROVIDED:

"25. AWARD OF A CONTRACT UNDER THIS RFP MAY BE MADE WITHOUT DISCUSSION OF PROPOSALS RECEIVED, THEREFORE PROPOSALS SHOULD BE SUBMITTED INITIALLY ON THE MOST FAVORABLE TERMS FROM A PRICE AND TECHNICAL STANDPOINT.'

BY LETTER OF APRIL 14, 1964, TIME OIL COMPANY SUBMITTED TO THE DEFENSE FUEL SUPPLY CENTER ITS PROPOSAL IN RESPONSE TO THE RFP, WHEREIN IT OFFERED TO SUPPLY 368,286 BARRELS OF BULK PETROLEUM STORAGE FACILITIES DURING THE PERIOD JULY 1, 1964, THROUGH JUNE 30, 1965, AT THE PRICE OF $0.754 PER BARREL, OR FOR A TOTAL CHARGE OF $277,687.64. A "THRUPUT"OF 370,000 BARRELS WAS OFFERED AT NO ADDITIONAL CHARGE, AS PROVIDED FOR IN THE RFP. TIME ALSO OFFERED TO PROVIDE STORAGE AND RELATED RECEIVING AND SHIPPING FACILITIES FOR STORING A MAXIMUM OF 400,000 EMPTY GOVERNMENT-FURNISHED 55- 57 GALLON DRUMS. A CHARGE OF $0.17 PER DRUM WAS OFFERED FOR RECEIVING, UNLOADING, INSPECTING AND PLACING THE DRUMS IN STORAGE. STORAGE OF 153,000 DRUMS WAS OFFERED AT NO CHARGE, BUT FOR STORAGE OF ANY QUANTITY IN EXCESS THEREOF A CHARGE OF $0.06 PER DRUM PER MONTH WAS TO BE MADE. CHARGE OF $0.17 PER DRUM WAS OFFERED FOR REMOVING FROM STORAGE AND LOADING EMPTY DRUMS INTO GOVERNMENT-FURNISHED TRANSPORTATION EQUIPMENT. CHARGES OFFERED FOR FILLING AND LOADING THE DRUMS INTO GOVERNMENT VEHICLES WERE $0.033 PER GALLON FOR ORDERS INVOLVING LESS THAN 800 DRUMS; $0.0286 PER GALLON FOR ORDERS OF 800 TO 1,999 DRUMS; $0.0253 PER GALLON FOR ORDERS OF 2,000 TO 3,999 DRUMS; $0.022 PER GALLON FOR ORDERS OF 4,000 TO 4,999 DRUMS; AND $0.01925 PER GALLON FOR ORDERS OF 5,000 OR MORE DRUMS. IN ITS PROPOSAL, TIME OFFERED A DISCOUNT OF 1/10 OF 1 PERCENT FOR PAYMENT WITHIN 20 DAYS, AS PROVIDED FOR IN THE RFP.

TWO OTHER PROPOSALS WERE RECEIVED IN RESPONSE TO THE RFP, ONE FROM A CONCERN IN THE SAN FRANCISCO, CALIFORNIA, HARBOR AREA, WHICH OFFERED TO FURNISH ONLY A SMALL PART OF THE TOTAL SERVICES REQUIRED AND WAS NOT FURTHER CONSIDERED FOR AWARD, AND THE OTHER FROM EDGINGTON OIL REFINERIES, THE FACILITIES OF WHICH ARE LOCATED IN THE LOS ANGELES HARBOR AREA.

BY TELEGRAM OF APRIL 20, 1964, THE CONTRACTING OFFICER ADVISED WESTOIL TERMINALS COMPANY OF THE PROCURING ACTIVITY'S ELECTION TO EXERCISE ITS OPTION TO RENEW CONTRACT DSA 6-635 ON THE SAME TERMS AND CONDITIONS FOR THE PERIOD JULY 1, 1964, THROUGH JUNE 30, 1965. ON THE SAME DATE, A DFSC TELEGRAM WAS SENT TO TIME OIL COMPANY ACCEPTING THE PROPOSAL WHICH IT HAD SUBMITTED IN RESPONSE TO RFP NO. DSA 6-64-N-283 TO THE EXTENT OF 195,000 BARRELS OF BULK PETROLEUM STORAGE CAPACITY SPECIFIED IN THE PROPOSAL TO BE SUPPLIED THROUGH THE USE OF TIME'S TANKS NOS. 49001, 39910, 55012, 25001 AND 25002 AT THE RATE OF $0.754 PER BARREL, AND THE TOTAL DRUM STORAGE AND FILLING SERVICES WHICH HAD BEEN OFFERED. THE TELEGRAM DREW ATTENTION TO THE FACT THAT THE REMAINDER OF THE BULK PETROLEUM STORAGE FACILITIES OFFERED IN TIME'S PROPOSAL, CONSISTING OF THE TANKS NOS. 80001 AND 93002 SPECIFIED THEREIN (OF THE AGGREGATE CAPACITY OF 173,286 BARRELS), HAD BEEN PROCURED BY RENEWAL OF CONTRACT DSA 6-635.

IN A LETTER DATED APRIL 27, 1964, SIGNED BY GRAHAM FOLK AS VICE PRESIDENT, TIME OIL COMPANY, ADVISED THE DEFENSE FUEL SUPPLY CENTER, IN EFFECT, THAT THE PROPOSAL WHICH THE COMPANY HAD SUBMITTED IN RESPONSE TO THE RFP WAS INTENDED TO BE AN ALL-OR-NONE OFFER AND THAT THE EXTENSION AUTHORIZED IN THE ABOVE-QUOTED TELEGRAM OF MARCH 25, 1964, WAS INTENDED TO "APPLY TO BOTH CONTRACTS AS A PACKAGE AND NOT JUST ONE.' ALSO, THE AUTHOR OF THE LETTER OBSERVED THAT IT WOULD BE NOTED THAT "YOU DO NOT HAVE AN EXTENSION OF THE OPTION FROM WESTOIL TERMINALS CO., " AND STATED THAT TIME HAD BEEN ADVISED BY THAT CONCERN THAT "THE EXERCISE WAS NOT TIMELY AS THEY HAVE NOT GRANTED ANY EXTENSION OF TIME TO THE GOVERNMENT.' THE LETTER CONCLUDED:

"IT WOULD THEREFORE APPEAR TO US THAT THE GOVERNMENT'S CONTRACTUAL RIGHTS OF STORAGE AND CONTAINER FILLING FACILITIES WITH TIME OIL CO. WILL END OF JUNE 30 OF THIS YEAR AND AS OF NOW WESTOIL TERMINALS CO. HAS TAKEN THE SAME POSITION AS TO THEIR STORAGE FACILITIES PROVIDED PURSUANT TO DSA 6- 635.

"WE THEREFORE SUGGEST THAT CERTAIN STEPS BE TAKEN TO CLARIFY THIS MATTER. EXACTLY WHAT PROCEDURES ARE APPLICABLE UNDER THESE CIRCUMSTANCES IS NOT CLEAR. AS THERE IS A DENIAL ON OUR PART OF THE EXISTENCE OF A CONTRACT PURSUANT TO DSA 6-64-N-283 AND THERE SEEMS TO BE NO QUESTION THAT DSA 6-634 HAS NOT BEEN RENEWED.'

IN REPLYING TO THE ABOVE LETTER BY LETTER OF MAY 6, 1964 (WHICH SHOWS THAT A COPY THEREOF WAS FURNISHED TO WESTOIL), THE CONTRACTING OFFICER, IN TAKING ISSUE WITH THE CONTENTIONS ADVANCED THEREIN, STATED:

"ACCORDING TO THE BIDDERS MAILING LIST APPLICATIONS ON FILE AT THIS CENTER, MR. W. G. FRENCH HAS BEEN REPRESENTED AS AN OFFICIAL AND AUTHORIZED REPRESENTATIVE OF WESTOIL TERMINALS CO. AND TIME OIL COMPANY. FURTHERMORE, OUR RECORDS APPLICABLE TO CONTRACT DSA 6-635 CONTAIN MANY DOCUMENTS SIGNED BY MR. FRENCH. THEREFORE, THE WIRE OF 25 MARCH 1964 DID EXTEND THE TIME IN WHICH THE GOVERNMENT COULD EXERCISE ITS OPTION TO RENEW CONTRACT DSA 6-635.' IN YOUR LETTERS OF JUNE 1, 1964, AND AUGUST 10, 1964, WHICH WERE SIGNED ON BEHALF OF TIME OIL COMPANY AND WESTOIL TERMINALS COMPANY BY W. G. FRENCH, IT IS NOT CONTENDED THAT MR. FRENCH LACKED AUTHORITY TO AGREE ON BEHALF OF WESTOIL TO AN EXTENSION OF THE TIME WITHIN WHICH THE GOVERNMENT WAS REQUIRED TO GIVE NOTICE OF ITS ELECTION TO RENEW CONTRACT DSA 6-635. THAT MR. FRENCH HAD THE APPARENT, IF NOT THE ACTUAL, AUTHORITY TO AGREE TO AN EXTENSION AND THUS TO BIND WESTOIL TERMINALS COMPANY IN THE MATTER SEEMS WELL ESTABLISHED BY THE RECORD. NOT ONLY DOES IT APPEAR FROM THE CONTRACTING OFFICER'S LETTER OF MAY 6, 1964, THAT IN THE BIDDER'S MAILING LIST APPLICATION SUBMITTED BY WESTOIL TERMINALS COMPANY TO THE CONTRACTING AGENCY MR. FRENCH WAS REPRESENTED AS AN OFFICIAL AND AUTHORIZED REPRESENTATIVE OF THE CONTRACTOR, BUT MR. FRENCH ALSO SIGNED CONTRACT DSA 6-635 ON BEHALF OF WESTOIL IN THE CAPACITY OF "CONTRACTING OFFICER," AND ON MAY 27, 1963, AND OCTOBER 2, 1963, RESPECTIVELY, HE SIGNED THE TWO SUPPLEMENTAL AGREEMENTS MADE TO THE CONTRACT ON BEHALF OF THE CONTRACTOR IN SUCH CAPACITY. IN THIS CONNECTION, SEE 3 AM.JUR. 2D, AGENCY, SECS. 73, 74.

WHILE IT IS STATED IN YOUR LETTER OF JUNE 1, 1964, THAT MR. FRENCH INFORMED THE DFSC THAT IF THE CENTER WISHED MORE TIME TO EXERCISE THE OPTIONS UNDER CONTRACTS DSA 6-634 AND DSA 6-635,"IT WOULD HAVE TO BE FOR BOTH CONTRACTS," THE RECORDS OF THE TELEPHONE CONVERSATIONS HELD BETWEEN MR. FRENCH AND THE DFSC BUYER, ON MARCH 17 AND MARCH 25, 1964, AS SET FORTH IN THE BUYER'S ABOVE-QUOTED MEMORANDUMS OF THOSE DATES, DO NOT INDICATE THAT THE CENTER WAS ADVISED OF ANY CONDITION ATTACHING TO THE EXTENSION WITH RESPECT TO CONTRACT 6-635 WHICH HAD BEEN REQUESTED. NEITHER DO WE BELIEVE THAT THE WORDING OF THE TELEGRAM OF MARCH 25 INDICATED SUCH A CONDITION. IT IS WELL ESTABLISHED THAT RECORDS OF PUBLIC OFFICERS MADE IN THE COURSE OF THE DISCHARGE OF THEIR OFFICIAL DUTIES ARE ORDINARILY ADMISSIBLE IN EVIDENCE NOT ONLY AS PROOF OF THE FACTS STATED THEREIN, BUT ALSO TO SHOW THE ABSENCE OF ENTRIES THAT IN THE USUAL COURSE SHOULD APPEAR THEREIN AND TO PROVE, BY REASON OF THE ABSENCE OF ANY ENTRY, THAT AN EVENT DID NOT TAKE PLACE OR THAT SOMETHING WAS NOT DONE. SEE OLENDER V. UNITED STATES (C.C.A 9TH CAL., 1954), 210 F.2D 795, 801, 42 ALR 2D 736; CHESAPEAKE AND DELAWARE CANAL CO. V. UNITED STATES (C.C.A. 3D, 1917), 240 F. 903, 907, AFF. 250 U.S. 123; 20 AM.JUR., EVIDENCE, SEC. 1023. MOREOVER, THE CONTRACTING OFFICER HAS STATED IN HIS REPORT THAT THE BUYER IN QUESTION "STATES THAT MR. FRENCH DID NOT CONDITION HIS OFFER TO EXTEND THE TIME IN WHICH THE GOVERNMENT COULD EXERCISE ITS OPTION UNDER CONTRACT DSA 6 635 AS INDICATED IN THE SECOND PARAGRAPH ON PAGE ONE OF SUBJECT YOUR LETTER.'

IN OUR OPINION, THE FACT THAT WESTOIL TERMINALS COMPANY WAS NOT MENTIONED IN MR. FRENCH'S ABOVE-QUOTED TELEGRAM OF MARCH 25, 1964, IS OF NO MATERIAL CONSEQUENCE. THE TELEGRAM REFERRED TO THE WESTOIL CONTRACT BY NUMBER, AND WAS SIGNED BY THE SAME PERSON WHO HAD EXECUTED THE CONTRACT. ALSO, THE TELEGRAM WAS MERELY A CONFIRMATION OF THE EXTENSIONS OF TIME WITH RESPECT TO THE EXERCISE OF THE OPTIONS UNDER BOTH CONTRACTS WHICH HAD ALREADY BEEN AGREED TO BY MR. FRENCH IN THE TELEPHONE CONVERSATION OF MARCH 25, 1964, THE RECORD OF WHICH IS SET FORTH ABOVE, AND WAS IN RESPONSE TO THE GOVERNMENT'S REQUEST FOR EXTENSION OF THE OPTION UNDER THE WESTOIL CONTRACT.

THE RECORD BEFORE US FURNISHES NO BASIS WHATSOEVER FOR THE SUGGESTION IN YOUR LETTER OF AUGUST 10, 1964, THAT, IN ACCEPTING TIME'S PROPOSAL IN PART AND SIGNIFYING THE GOVERNMENT'S ELECTION TO RENEW CONTRACT DSA 6-635, THE CONTRACTING OFFICER REALIZED THAT HE WAS "TAKING ADVANTAGE OF A TECHNICALITY OF THE FINE PRINT OF THE REQUESTED PROPOSAL, CONTRARY TO THE DESIRES OF THE BIDDER AND THAT ANY NEGOTIATION WOULD HAVE RESULTED IN A CLARIFICATION THAT THE OFFER WAS AN ALL OR NOTHING OFFER.' IN SUPPORT THEREOF, YOU STATE:

"YOU WILL NOTE THAT THE LAST SENTENCE OF OUR PROPOSAL DATED APRIL 14 REQUESTED THAT THE CONTRACTING OFFICER CONTACT THE WRITER FOR CLARIFICATION.'

TIME'S PROPOSAL DATED APRIL 14, 1964, AS DISTINGUISHED FROM ITS LETTER OF THE SAME DATE SUBMITTING THE PROPOSAL, CONTAINS NO REQUEST OF ANY KIND THAT THE CONTRACTING OFFICER CONTACT MR. FRENCH, OR TIME OIL COMPANY, IN REGARD THERETO. HOWEVER, THE LAST SENTENCE OF TIME'S LETTER SUBMITTING THE PROPOSAL IS AS FOLLOWS:

"IF THERE IS ANY QUESTION WITH REGARD TO THIS PROPOSAL, PLEASE CONTACT THE WRITER (W. G. FRENCH) FOR CLARIFICATION.'

SINCE THE CONTRACTING OFFICER APPARENTLY HAD NO QUESTIONS WITH REGARD TO THE TERMS OFFERED IN THE PROPOSAL, THERE WAS NO REASON FOR CONTACTING MR. FRENCH FOR CLARIFICATION THEREOF.

IN VIEW OF THE PROVISIONS OF PARAGRAPHS 1 AND 25 OF THE TERMS AND CONDITIONS OF RFP NO. DSA 6-64-N-283, QUOTED ABOVE, IT IS OUR OPINION THAT THE GOVERNMENT WAS FULLY WITHIN ITS RIGHTS IN MAKING THE PARTIAL AWARD THEREUNDER WITH WHICH WE ARE HERE CONCERNED. ALSO, SINCE CONTRACTS NOS. DSA 6-634 AND DSA 6-635, INCLUDING THE RENEWAL OPTIONS CONTAINED THEREIN, WERE NOT BY THEIR TERMS INTERRELATED, WE BELIEVE THE GOVERNMENT WAS EQUALLY WITHIN ITS RIGHTS IN EXERCISING THE OPTION TO RENEW CONTRACT DSA 6 -635 WITHOUT TAKING SIMILAR ACTION IN RESPECT TO CONTRACT DSA 6-634.

ACCORDINGLY, IT IS OUR CONCLUSION THAT THE ACTIONS TAKEN BY THE PROCURING ACTIVITY DID HAVE THE EFFECT OF EXTENDING THE PERFORMANCE PERIOD OF CONTRACT DSA 6-635 FOR ONE YEAR THROUGH JUNE 30, 1965, AND OF OBLIGATING TIME OIL COMPANY TO FURNISH 195,000 BARRELS OF BULK PETROLEUM STORAGE AND THE DRUM AND FILLING SERVICES REFERRED TO IN THE TELEGRAM WHICH THE DEFENSE FUEL SUPPLY CENTER ISSUED IN PARTIAL ACCEPTANCE OF THE PROPOSAL SUBMITTED IN RESPONSE TO RFP NO. DSA 6-64-N 283 AT THE UNIT PRICES STIPULATED THEREIN. WE ARE THEREFORE ADVISING THE DIRECTOR, DEFENSE SUPPLY AGENCY, TO TAKE APPROPRIATE ACTION IN ACCORD WITH THE FOREGOING.