B-154862, SEP. 2, 1964

B-154862: Sep 2, 1964

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INC.: REFERENCE IS MADE TO YOUR LETTER OF JULY 24. YOU WERE AWARDED CONTRACT NO. THE RECORD INDICATES THAT YOU HAVE BEEN PAID THE LATTER AMOUNT FOR THE INSPECTIONS SCHEDULED IN THE CONTRACT FOR OCTOBER 1963 AND APRIL 1964. IT IS YOUR CONTENTION THAT YOU SHOULD BE PAID THIS ADDITIONAL AMOUNT BECAUSE THE REINSPECTION "WAS NOT NECESSARY AS CALLED FOR BY THE CODE (AMERICAN STANDARD PRACTICE FOR THE INSPECTION OF ELEVATORS. SINCE YOU MAKE THE POINT IN YOUR LETTER THAT OUR PRIOR CONSIDERATION OF YOUR CLAIM WAS MADE WITHOUT OBTAINING A REPORT FROM YOU OF THE FACTS INVOLVED. WHICH WAS INCORPORATED BY REFERENCE IN THE CONTRACT IN THIS CASE. THIS CLAUSE PROVIDES THAT ANY DISPUTE CONCERNING A QUESTION OF FACT ARISING UNDER THE CONTRACT WHICH IS NOT DISPOSED OF BY AGREEMENT SHALL BE DECIDED BY THE CONTRACTING OFFICER.

B-154862, SEP. 2, 1964

TO BRANDON-DIXON ELEVATOR SERVICE, INC.:

REFERENCE IS MADE TO YOUR LETTER OF JULY 24, 1964, AND ENCLOSURES, REQUESTING RECONSIDERATION OF OUR SETTLEMENT OF JULY 15, 1964, DISALLOWING YOUR CLAIM FOR $315.15 FOR REINSPECTION OF FREIGHT ELEVATOR NO. 5 AT THE VETERANS ADMINISTRATION HOSPITAL, BIRMINGHAM, ALABAMA.

ON JUNE 3, 1963, YOU WERE AWARDED CONTRACT NO. V5258P-700 FOR SEMIANNUAL ELEVATOR MAINTENANCE INSPECTION AND TEST SERVICES AT THE ABOVE HOSPITAL FOR THE PERIOD JULY 1, 1963, THROUGH JUNE 30, 1964. THE INSPECTIONS AND TESTS COVERED 5 DUMBWAITERS, 4 PASSENGER ELEVATORS AND 1 FREIGHT ELEVATOR FOR THE LUMP-SUM PRICE OF $630.15. THE RECORD INDICATES THAT YOU HAVE BEEN PAID THE LATTER AMOUNT FOR THE INSPECTIONS SCHEDULED IN THE CONTRACT FOR OCTOBER 1963 AND APRIL 1964, AND CLAIM THE ADDITIONAL AMOUNT FOR REINSPECTION OF THE FREIGHT ELEVATOR ON JUNE 1, 1964. IT IS YOUR CONTENTION THAT YOU SHOULD BE PAID THIS ADDITIONAL AMOUNT BECAUSE THE REINSPECTION "WAS NOT NECESSARY AS CALLED FOR BY THE CODE (AMERICAN STANDARD PRACTICE FOR THE INSPECTION OF ELEVATORS, INSPECTORS' MANUAL A17.2-1960) BUT BECAUSE ONE INSPECTOR LISTED 2 TO 4 BREAKS ON NOVEMBER INSPECTION AND ON THE LATER INSPECTION WE COULD NOT FIND ANY BREAKS, HE (ENGINEER OFFICER) FORCED US, BY PUTTING OUR BONDING COMPANY ON NOTICE, TO RETURN.'

SINCE YOU MAKE THE POINT IN YOUR LETTER THAT OUR PRIOR CONSIDERATION OF YOUR CLAIM WAS MADE WITHOUT OBTAINING A REPORT FROM YOU OF THE FACTS INVOLVED, WE WISH TO DIRECT YOUR ATTENTION TO THE DISPUTES CLAUSE OF THE GENERAL PROVISIONS OF STANDARD FORM 32, 1961 EDITION, WHICH WAS INCORPORATED BY REFERENCE IN THE CONTRACT IN THIS CASE. THIS CLAUSE PROVIDES THAT ANY DISPUTE CONCERNING A QUESTION OF FACT ARISING UNDER THE CONTRACT WHICH IS NOT DISPOSED OF BY AGREEMENT SHALL BE DECIDED BY THE CONTRACTING OFFICER, WHO SHALL REDUCE HIS DECISION TO WRITING AND FURNISH A COPY THEREOF TO THE CONTRACTOR. IT FURTHER PROVIDES THAT SUCH DECISION SHALL BE FINAL AND CONCLUSIVE UNLESS, WITHIN 30 DAYS FROM THE DATE OF RECEIPT BY THE CONTRACTOR, A WRITTEN APPEAL IS FILED WITH THE HEAD OF THE DEPARTMENT INVOLVED, WHOSE DECISION IS FINAL AND CONCLUSIVE UNLESS REVERSED BY A COURT OF COMPETENT JURISDICTION. IT DOES NOT APPEAR FROM THE RECORD THAT YOU AVAILED YOURSELF OF THIS PROCEDURE TO RESOLVE ANY FACTUAL DISPUTES WHICH YOU FELT RELEVANT TO A DETERMINATION OF YOUR CLAIM, AND IN THESE CIRCUMSTANCES WE WOULD ORDINARILY BE BOUND TO ACCEPT THE ADMINISTRATIVE STATEMENT.

IN ANY EVENT, WE HAVE NOW CONSIDERED THE COMPLETE CORRESPONDENCE AS FURNISHED BY YOU, AND WHILE YOU INSIST THAT THE ACTION TAKEN BY THE CONTRACTING OFFICER WAS NOT JUSTIFIED, THERE SEEMS TO BE NO SUBSTANTIAL DISPUTE AS TO THE FACTS WHICH ARE PERTINENT TO A DETERMINATION OF YOUR CLAIM.

YOUR REPORT OF INSPECTION OF THE FREIGHT ELEVATOR OF NOVEMBER 21, 1963, SHOWED 2-4 WIRES BROKEN IN THE HOISTING CABLE, WHEREAS YOUR REPORT OF THE INSPECTION OF THE SAME CABLE ON APRIL 28, 1964, STATED "NO BREAKS.' THIS REPORT WAS PREPARED FROM YOUR RECORDS BY THE ENGINEER OFFICER'S SECRETARY AND SIGNED BY JAMES P. DIXON. THE CONTRACTING OFFICER'S LETTER OF MAY 4, 1964, POINTED OUT THIS DISCREPANCY, IN ADDITION TO OTHER DEFICIENCIES IN YOUR REPORT, AND REQUESTED THAT YOU MAKE A REINSPECTION WITHIN 15 DAYS AND SUBMIT ANOTHER REPORT OR RUN THE RISK OF BEING DECLARED IN DEFAULT. WITHOUT MAKING ANY FURTHER INSPECTION YOU SUBMITTED REPORTS ON EACH OF THE ELEVATORS AND DUMBWAITERS ALONG WITH A COVER LETTER DATED MAY 14, 1964. YOU THEREIN ATTEMPTED TO EXPLAIN THE CONFLICT IN THE REPORTS WITH REGARD TO THE FREIGHT ELEVATOR BY STATING:

"* * *. IT IS POSSIBLE FOR ANYONE TO FIND TWO TO FOUR BROKEN WIRES ONE INSPECTION AND UNLESS THE EXACT SPOT BE MARKED TO MISS THEM ON THE NEXT INSPECTION. EVEN AN "ENGINEER" COULD DO THIS. HAD OUR EXPERIENCED SECRETARY BEEN PERMITTED TO CHECK THESE REPORTS THIS WOULD HAVE BEEN BROUGHT TO MY ATTENTION.'

BY LETTER OF MAY 26, 1964, THE CONTRACTING OFFICER ADVISED YOU THAT THE REPORT SUBMITTED MAY 14, 1964, WAS ACCEPTABLE AS TO ALL UNITS EXCEPT THE FREIGHT ELEVATOR, BUT THAT A REINSPECTION WOULD BE NECESSARY TO DETERMINE IF THERE HAD BEEN AN INCREASE IN THE NUMBER OF BROKEN WIRESIN THE HOIST CABLE. THEREAFTER, ON JUNE 1, 1964, YOU REINSPECTED THE CABLE IN QUESTION AND FOUND NO BREAKS. THE CONTRACTING OFFICER'S LETTER OF THAT SAME DATE STATED "WE NOW FEEL THAT YOU HAVE THOROUGHLY INSPECTED THESE CABLES AND THIS REPORT IS NOW ACCEPTABLE.'

THE QUESTION HERE INVOLVED IS WHETHER THE INSPECTION ON APRIL 28, 1964, AND REPORT THEREOF CONSTITUTED COMPLETE PERFORMANCE OF THE CONTRACT AND ENTITLED YOU TO PAYMENT THEREFOR WITHOUT FURTHER INSPECTION, OR WHETHER THE CONTRACTING OFFICER PROPERLY CONDITIONED FINAL PAYMENT UNDER THE CONTRACT UPON A REINSPECTION OF THE FREIGHT ELEVATOR. WHAT CONSTITUTES SUFFICIENT PERFORMANCE OF A CONTRACT SO AS TO ENTITLE ONE TO PAYMENT THEREFOR ORDINARILY DEPENDS ON WHETHER THERE HAS BEEN A COMPLIANCE WITH THE REQUIREMENTS OF THE PARTICULAR CONTRACT. 17A C.J.S. CONTRACTS SEC. 494/1). IN THIS REGARD, THE SPECIFICATIONS, PARAGRAPH 2, INSPECTIONS, PROVIDES THAT THE ,INSPECTION SHALL BE THOROUGH AND COVER ALL ITEMS" IN THE REPORT FORM FURNISHED BY THE VA, "AS WELL AS ... OTHER PARTS AND ASSEMBLIES ... IN ORDER TO MAKE A PROPER INSPECTION.' IN ADDITION, ACCOMPANYING EVERY CONTRACT IS A COMMON LAW DUTY TO PERFORM ITS REQUIREMENTS IN A SKILLFUL AND WORKMANLIKE MANNER. C.J.S., SUPRA.

IN THE INSTANT CASE, WHERE THE REPORTS OF INSPECTION WERE INCONSISTENT, LEAVING IT DOUBTFUL WHETHER THERE WERE BROKEN WIRES AND TO WHAT EXTENT, IT CANNOT BE SAID THAT YOUR PERFORMANCE WAS SUFFICIENT UNDER THE PROVISIONS OF THE CONTRACT OR THE DUTIES IMPOSED BY THE COMMON LAW. FURTHERMORE, YOUR EXPLANATION IN YOUR LETTER OF MAY 14, OF THE DISCREPANCY BETWEEN THE TWO REPORTS INDICATES YOUR AWARENESS THAT PREVIOUSLY REPORTED BREAKS CAN BE MISSED IN A SUBSEQUENT INSPECTION. THE CONTRACTING OFFICER ALSO FELT THAT THE BREAKS HAD BEEN MISSED IN THE INSPECTION, AND REASONABLY CONCLUDED THAT THE INSPECTION HAD NOT BEEN "THOROUGH" AND "PROPER.' THEREFORE REQUIRED THERE INSPECTION TO DETERMINE IF THERE HAD BEEN AN INCREASE IN THE NUMBER OF SUCH BREAKS. IN THIS CONNECTION, YOU WILL NOTE THAT THE INSPECTORS' MANUAL, TO WHICH YOU REFER, RECOMMENDS IN PARAGRAPH 27 THAT IT BE NOTED WHEN BROKEN WIRES BEGIN TO APPEAR, AND THAT THEY THEREAFTER BE CHECKED FREQUENTLY TO DETERMINE THE RATE OF INCREASE.

UNDER THESE CIRCUMSTANCES, THE REINSPECTION FOR WHICH YOU CLAIM ADDITIONAL COMPENSATION WAS NOTHING MORE THAN A FULFILLMENT OF YOUR OBLIGATION TO MAKE A "THOROUGH" AND "PROPER INSPECTION" IN "SKILLFUL AND WORKMANLIKE MANNER," FOR WHICH YOU ARE ENTITLED TO NOTHING MORE THAN THE CONTRACT PRICE, WHICH YOU HAVE RECEIVED.

IN VIEW OF THE FOREGOING, OUR SETTLEMENT DISALLOWING YOUR CLAIM IS SUSTAINED.