B-162643, FEB. 1, 1968

B-162643: Feb 1, 1968

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THE PROCURING AGENCY'S FAVORABLE RECOMMENDATION IS A PREREQUISITE TO ANY ACTION BY THE COMP. SUCH CLAIM WAS NOT APPEALED IN ACCORDANCE WITH THE CONTRACT AND THEREFORE THE DECISION OF THE CONTRACTING OFFICER MUST BE ACCORDED FINALITY. IT WAS REQUESTED THAT MEASURES BE TAKEN TO ASSURE IN FUTURE CASES THAT CONTRACTORS WILL NOT BE ADVISED THAT REQUESTS FOR REMISSION OF LIQUIDATED DAMAGES SHOULD BE SUBMITTED TO GAO WHERE THE DEPT. HAS FINALLY DETERMINED THAT NO FAVORABLE RECOMMENDATION WILL BE MADE. IT IS APPARENT FROM THE STATUTE AND IT HAS CONSISTENTLY BEEN OUR VIEW THAT AN AGENCY'S RECOMMENDATION FOR REMISSION IS A PREREQUISITE TO ANY ACTION BY THIS OFFICE. THE DEPARTMENT'S ADVICE THAT ITS ADVERSE DECISION CAN BE APPEALED TO THIS OFFICE WAS ERRONEOUS INSOFAR AS YOUR REQUEST WAS FOR REMISSION ON AN EQUITABLE BASIS.

B-162643, FEB. 1, 1968

CONTRACTS - DAMAGES - LIQUIDATED - REMISSION DECISION ON REQUEST OF FEDERAL CONSTRUCTION CO. FOR REMISSION OF LIQUIDATED DAMAGES ASSESSED BY AIR FORCE. A CONTRACTOR MAY NOT APPEAL THE MATTER OF THE REMISSION OF LIQUIDATED DAMAGES DIRECTLY TO THE COMPTROLLER GENERAL SINCE UNDER THE LIQUIDATED DAMAGE REMISSION AUTHORITY IN 10 U.S.C. 2313, THE PROCURING AGENCY'S FAVORABLE RECOMMENDATION IS A PREREQUISITE TO ANY ACTION BY THE COMP. GEN. FURTHER, TO THE EXTENT THAT REQUEST FOR REMISSION MAY BE CONSIDERED A CLAIM FOR PAYMENT OF DAMAGES WITHHELD, ON THE LEGAL MERITS, SUCH CLAIM WAS NOT APPEALED IN ACCORDANCE WITH THE CONTRACT AND THEREFORE THE DECISION OF THE CONTRACTING OFFICER MUST BE ACCORDED FINALITY. IN LETTER TO SECY. OF THE AIR FORCE, IT WAS REQUESTED THAT MEASURES BE TAKEN TO ASSURE IN FUTURE CASES THAT CONTRACTORS WILL NOT BE ADVISED THAT REQUESTS FOR REMISSION OF LIQUIDATED DAMAGES SHOULD BE SUBMITTED TO GAO WHERE THE DEPT. HAS FINALLY DETERMINED THAT NO FAVORABLE RECOMMENDATION WILL BE MADE.

TO KEITH, WINSTON AND REPSOLD:

WE REFER TO YOUR LETTER DATED OCTOBER 4, 1967, ON BEHALF OF FEDERAL CONSTRUCTION COMPANY, REQUESTING THE REMISSION OF LIQUIDATED DAMAGES IN THE AMOUNT OF $3,591.00, ASSESSED BY THE DEPARTMENT OF THE AIR FORCE AGAINST IT UNDER CONTRACT NO. AF 35/608/-2107. THE ENCLOSURES TO YOUR LETTER INDICATE THAT THE AIR FORCE HAS ADVISED YOU THAT YOU MAY PURSUE A REQUEST FOR REMISSION OF LIQUIDATED DAMAGES BY APPEALING THE CONTRACTING OFFICER'S ADVERSE DECISION DIRECTLY TO THIS OFFICE.

OUR AUTHORITY TO REMIT LIQUIDATED DAMAGES RESTS SOLELY UPON 10 U.S.C. 2312, WHICH PROVIDES THAT UPON THE RECOMMENDATION OF THE HEAD OF AN AGENCY THE COMPTROLLER GENERAL MAY REMIT ALL OR PART, AS HE CONSIDERS JUST AND EQUITABLE, OF ANY LIQUIDATED DAMAGES ASSESSED FOR DELAY IN PERFORMING A CONTRACT MADE BY THAT AGENCY. IT IS APPARENT FROM THE STATUTE AND IT HAS CONSISTENTLY BEEN OUR VIEW THAT AN AGENCY'S RECOMMENDATION FOR REMISSION IS A PREREQUISITE TO ANY ACTION BY THIS OFFICE. THE DEPARTMENT'S ADVICE THAT ITS ADVERSE DECISION CAN BE APPEALED TO THIS OFFICE WAS ERRONEOUS INSOFAR AS YOUR REQUEST WAS FOR REMISSION ON AN EQUITABLE BASIS.

NEVERTHELESS, UPON RECEIPT OF YOUR LETTER A COMPLETE REPORT IN THE MATTER TOGETHER WITH HIS DEPARTMENT'S VIEWS AND RECOMMENDATIONS WAS REQUESTED FROM THE SECRETARY OF THE AIR FORCE. THE REPORT DID NOT RECOMMEND REMISSION. CONSEQUENTLY, YOUR REQUEST MUST NECESSARILY BE DENIED UNLESS AND UNTIL WE RECEIVE A FAVORABLE RECOMMENDATION FROM THE DEPARTMENT OF THE AIR FORCE.

TO THE EXTENT THAT YOUR REQUEST MAY BE CONSIDERED AS A CLAIM FOR PAYMENT OF THE AMOUNT OF DAMAGES WITHHELD, ON THE LEGAL MERITS IT APPEARS THAT THE DECISION OF THE CONTRACTING OFFICER, WHICH WAS NOT APPEALED IN ACCORDANCE WITH THE PROVISIONS OF THE CONTRACT, MUST BE CONSIDERED AS FINAL.