B-154777, AUG. 5, 1964

B-154777: Aug 5, 1964

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SERVICES ADMINISTRATION: SERVICES ADMINISTRATION REFERENCE IS MADE TO THE ACTING ADMINISTRATOR'S LETTER OF JULY 20. IS ENTITLED TO ADDITIONAL COMPENSATION BY VIRTUE OF INCREASED FREIGHT CHARGES IN SHIPPING 4. WAS ISSUED OCTOBER 1. BIDS RECEIVED IN RESPONSE THERETO WERE OPENED ON OCTOBER 4. WAS MADE OCTOBER 7. ALL OF THE PALLETS HAVE BEEN DELIVERED. WHICH WAS INCLUDED IN ITS UNIT PRICE OF $6.43. WHICH WERE SHIPPED ON OCTOBER 29. WERE 63 CENTS PER UNIT AS QUOTED. THE FREIGHT CHARGES WERE $2.29 PER UNIT ON 2. WHICH AMOUNT IS STATED TO BE $6. THAT SAID RATES WERE PROPERLY FILED. REFORMATION IS PROPER ONLY WHERE THE CONTRACT DOES NOT EMBODY THE ACTUAL TERMS INTENDED BY THE PARTIES THERETO.

B-154777, AUG. 5, 1964

SERVICES ADMINISTRATION:

SERVICES ADMINISTRATION

REFERENCE IS MADE TO THE ACTING ADMINISTRATOR'S LETTER OF JULY 20, 1964, AND ENCLOSURES, REQUESTING A DETERMINATION AS TO WHETHER LONG BEACH PALLET SALES COMPANY, INC., IS ENTITLED TO ADDITIONAL COMPENSATION BY VIRTUE OF INCREASED FREIGHT CHARGES IN SHIPPING 4,000 PALLETS UNDER CONTRACT NO. GS- 09S-12546.

TELEGRAPHIC REQUEST FOR BIDS NSFY-27684-64 FOR 5 ITEMS OF PALLETS TO BE DELIVERED ON VARIOUS DATES F.O.B., GSA STORE, FORT KAM STORAGE AREA, BLDG. T-3071, HICKAM AIR FORCE BASE, HONOLULU, HAWAII, WAS ISSUED OCTOBER 1, 1963. BIDS RECEIVED IN RESPONSE THERETO WERE OPENED ON OCTOBER 4, 1963, AND AWARD OF 3 ITEMS CONSISTING OF 5,500 PALLETS AT A UNIT PRICE OF $6.43 EACH, FOR A TOTAL CONTRACT PRICE OF $35,365.00, WAS MADE OCTOBER 7, 1963, TO LONG BEACH PALLET SALES COMPANY, INC. ALL OF THE PALLETS HAVE BEEN DELIVERED.

THE RECORD INDICATES THAT IN PREPARING ITS BID LONG BEACH CONTACTED MATSON NAVIGATION COMPANY BY TELEPHONE AND OBTAINED A FREIGHT CHARGE QUOTATION OF 63 CENTS PER UNIT, WHICH WAS INCLUDED IN ITS UNIT PRICE OF $6.43. THE FREIGHT CHARGES ON THE FIRST 1,500 PALLETS, WHICH WERE SHIPPED ON OCTOBER 29, 1963, WERE 63 CENTS PER UNIT AS QUOTED. ON SHIPMENTS MADE AFTER NOVEMBER 1, 1963, THE FREIGHT CHARGES WERE $2.29 PER UNIT ON 2,000 PALLETS AND $2.35 PER UNIT ON THE REMAINING 2,000 PALLETS. ON FEBRUARY 17, 1964, AFTER THE FINAL SHIPMENT, THE CONTRACTOR REQUESTED RELIEF FROM THE CONTRACTING ACTIVITY FOR THE DIFFERENCE BETWEEN THE 63 CENT FIGURE USED IN COMPUTING THE BID AND THE ACTUAL CHARGES OF $2.29 AND $2.35, WHICH AMOUNT IS STATED TO BE $6,760.00. SUBSEQUENT INVESTIGATION OF THIS MATTER BY THE CONTRACTING OFFICER INDICATES THAT AT THE TIME OF PREPARATION OF THE BID MATSON NAVIGATION COMPANY HAD ALREADY BEEN GRANTED AN INCREASE IN FREIGHT RATES, EFFECTIVE AFTER OCTOBER 31, 1963, BY THE FEDERAL MARITIME COMMISSION, AND THAT SAID RATES WERE PROPERLY FILED, PUBLISHED AND POSTED PURSUANT TO APPLICABLE LAW AND REGULATIONS.

IN EFFECT, LONG BEACH NOW REQUESTS THAT THE CONTRACT BE REFORMED OR MODIFIED TO INCREASE THE COMPENSATION THEREIN PROVIDED FOR. HOWEVER, REFORMATION IS PROPER ONLY WHERE THE CONTRACT DOES NOT EMBODY THE ACTUAL TERMS INTENDED BY THE PARTIES THERETO, 40 COMP. GEN. 326, AS WHERE THERE IS A MUTUAL MISTAKE. IN THE INSTANT CASE, IT APPEARS THAT THE BID OF LONG BEACH PALLET SALES COMPANY, INC., WAS EXACTLY AS INTENDED AT THE TIME IT WAS SUBMITTED, ALTHOUGH IT LATER PROVED TO BE A BAD BARGAIN. NOTHING IS ALLEGED OR INDICATED IN THE RECORD THAT ACCEPTANCE OF THE BID BY THE GOVERNMENT WAS OTHER THAN IN GOOD FAITH. THEREFORE, A VALID AND BINDING CONTRACT WAS CONSUMMATED, WHICH FIXED THE RIGHTS AND LIABILITIES OF THE PARTIES THERETO. OGDEN AND DOUGHERTY V. UNITED STATES, 102 CT.CL. 249. IT IS A WELL-ESTABLISHED PRINCIPLE OF LAW THAT VALID CONTRACTS ARE TO BE ENFORCED AND PERFORMED AS WRITTEN AND THAT THE FACT THAT SUPERVENING OR UNFORESEEN EVENTS RENDER PERFORMANCE MORE BURDENSOME OR LESS PROFITABLE, OR EVEN OCCASION LOSS, IS NOT SUFFICIENT TO EXCUSE PERFORMANCE OR TO ENTITLE A CONTRACTOR TO ADDITIONAL COMPENSATION. SEE ROLIN V. UNITED STATES, 142 CT.CL. 81, AND CASES CITED. SINCE THE CONTRACT HERE INVOLVED MADE NO PROVISION FOR ANY ADJUSTMENT IN CASE OF INCREASED COSTS OF PERFORMANCE, THE STATED PRINCIPLE OF LAW CLEARLY IS FOR APPLICATION AND LONG BEACH WAS BOUND TO PERFORM THE CONTRACT IN ACCORDANCE WITH ITS TERMS AND AT THE COMPENSATION STIPULATED.

ACCORDINGLY, THERE IS NO LEGAL BASIS TO ALLOW THE ADDITIONAL COMPENSATION REQUESTED BY THE CONTRACTOR.