B-163283, MAR. 13, 1969

B-163283: Mar 13, 1969

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KUNZIG: REFERENCE IS MADE TO A LETTER. THE CLAIM SETTLEMENT WAS NEGOTIATED BY PERSONNEL OF YOUR DENVER REGIONAL OFFICE. WHICH WAS RESCINDED ON JANUARY 9. BECAUSE OF THESE DELAYS AND OTHER GOVERNMENT CAUSED DISRUPTIONS OF THE WORK THE ORIGINAL COMPLETION DATE OF THE CONTRACT WAS EXTENDED FROM FEBRUARY 2. NO LIQUIDATED DAMAGES WERE ASSESSED AGAINST THE CONTRACTOR. SETTLEMENT WAS NEGOTIATED BY YOUR OFFICE ON THE BASIS OF 168 DAYS OF UNREASONABLE DELAY. SEVERAL OBJECTIONS WERE RAISED CONCERNING THE LACK OF DOCUMENTARY SUPPORT OF THE LABOR EFFICIENCY LOSS ALLEGEDLY INCURRED BY THE CONTRACTOR AS A RESULT OF THE GOVERNMENT'S UNREASONABLE DISRUPTION OF THE WORK SCHEDULE. THAT THE CONTRACTOR WAS DAMAGED BY SUCH BREACH.

B-163283, MAR. 13, 1969

TO MR. KUNZIG:

REFERENCE IS MADE TO A LETTER, DATED DECEMBER 28, 1967, WITH ENCLOSURES, FROM MR. LEO FREEMAN, ACTING ASSISTANT GENERAL COUNSEL, TRANSMITTING THE CLAIM OF THE HEGEMAN-HARRIS CO., INC., FOR DELAY DAMAGES ARISING OUT OF CONTRACT NO. GS-08B-3566/29908) FOR CONSTRUCTION OF THE COURTHOUSE AND FEDERAL OFFICE BUILDING, ALBUQUERQUE, NEW MEXICO. THE CLAIM SETTLEMENT WAS NEGOTIATED BY PERSONNEL OF YOUR DENVER REGIONAL OFFICE.

THE CLAIM INVOLVES FOUR SEPARATE ALLEGATIONS OF BREACH OF CONTRACT RESULTING FROM (1) THE ISSUANCE OF A STOP WORK ORDER ON JANUARY 4, 1964, WHICH WAS RESCINDED ON JANUARY 9, 1964; (2) THE GOVERNMENT'S FAILURE TO ISSUE PARTITION LAYOUTS FOR AN UNDULY EXTENDED PERIOD OF TIME; (3) MULTIPLE DELAYS IN MAKING CHANGES IN THE MILLWORK REQUIREMENTS; AND (4) THE ISSUANCE OF A STOP WORK ORDER ON MAY 25, 1965, PENDING THE ISSUANCE OF VARIOUS CHANGE ORDERS INVOLVING WORK ON THE FIRST FLOOR. BECAUSE OF THESE DELAYS AND OTHER GOVERNMENT CAUSED DISRUPTIONS OF THE WORK THE ORIGINAL COMPLETION DATE OF THE CONTRACT WAS EXTENDED FROM FEBRUARY 2, 1965, TO JANUARY 6, 1966 - TOTAL OF 329 DAYS, AND NO LIQUIDATED DAMAGES WERE ASSESSED AGAINST THE CONTRACTOR. SETTLEMENT WAS NEGOTIATED BY YOUR OFFICE ON THE BASIS OF 168 DAYS OF UNREASONABLE DELAY.

AFTER REVIEW BY THIS OFFICE, SEVERAL OBJECTIONS WERE RAISED CONCERNING THE LACK OF DOCUMENTARY SUPPORT OF THE LABOR EFFICIENCY LOSS ALLEGEDLY INCURRED BY THE CONTRACTOR AS A RESULT OF THE GOVERNMENT'S UNREASONABLE DISRUPTION OF THE WORK SCHEDULE, AND THE METHOD USED IN DETERMINING THE PORTION OF THE CONTRACTOR'S HOME OFFICE OVERHEAD PROPERLY ALLOCABLE TO THE SUBJECT CONTRACT DURING THE PERIOD OF UNREASONABLE GOVERNMENT DELAY. YOUR GENERAL COUNSEL FURNISHED SUPPLEMENTAL INFORMATION CONCERNING THESE MATTERS UNDER DATES OF SEPTEMBER 23, 1968, AND FEBRUARY 18, 1969. BASED UPON THE PRESENT RECORD, INCLUDING THE ADDITIONAL INFORMATION CONTAINED IN THESE SUPPLEMENTAL REPORTS, WE NOW AGREE THAT THE GOVERNMENT BREACHED THE CONTRACT; THAT THE CONTRACTOR WAS DAMAGED BY SUCH BREACH; AND THAT THE PROPOSED SETTLEMENT IS REASONABLE AND WOULD BE IN THE BEST INTEREST OF THE GOVERNMENT. ACCORDINGLY, YOU ARE AUTHORIZED TO PAY THE CONTRACTOR THE SUM OF $238,000 AS FULL AND FINAL PAYMENT OF THE CLAIM.