B-171144(2), FEB 2, 1972

B-171144(2): Feb 2, 1972

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APPROPRIATE ACTION SHOULD BE TAKEN TO INSURE THAT SUCH AMOUNT WILL BE WITHHELD FROM PAYMENT UNDER THE SETTLEMENT AGREEMENT. WE ARE ENCLOSING A COPY OF OUR DECISION OF TODAY TO THE SECRETARY OF THE NAVY CONCERNING THIS DEBT. IT IS REQUESTED THAT APPROPRIATE ACTION BE TAKEN BY YOUR DEPARTMENT TO ASSURE THAT THE APPROXIMATE SUM OF $272. 611.59 WILL BE WITHHELD FROM PAYMENT UNDER THE SETTLEMENT AGREEMENT PENDING A FINAL DETERMINATION OF THE AMOUNT DUE THE UNITED STATES UNDER THE FOUR CONTRACTS CITED ABOVE.

B-171144(2), FEB 2, 1972

CONTRACTS - SETOFF FOR LIQUIDATED DAMAGES THE INDEBTEDNESS OF THE ADMIRAL CORPORATION TO THE UNITED STATES FOR UNLIQUIDATED WORK-IN-PROGRESS PAYMENTS ON FOUR GOVERNMENT CONTRACTS HAS BEEN DETERMINED TO BE $272,611.59. APPROPRIATE ACTION SHOULD BE TAKEN TO INSURE THAT SUCH AMOUNT WILL BE WITHHELD FROM PAYMENT UNDER THE SETTLEMENT AGREEMENT.

TO MR. SECRETARY:

THE DEFENSE SUPPLY AGENCY ON MAY 5, 1970, REPORTED TO OUR OFFICE A DEBT TOTALING $724,366.45, PLUS INTEREST, AGAINST THE ADMIRAL CORPORATION, CHICAGO, ILLINOIS. THE REPORTED INDEBTEDNESS CONSISTED OF UNLIQUIDATED WORK-IN-PROGRESS PAYMENTS UNDER AIR FORCE CONTRACT NO. AF033(657)14754, ARMY CONTRACT NO. DA-28-043-AMC-00470(E) AND NAVY CONTRACT NO. N600(19)62134; AND OF AN OVERPAYMENT RESULTING FROM DECREASING THE CONTRACT PRICE OF NAVY CONTRACT NO. NOBSR-89011.

WE ARE ENCLOSING A COPY OF OUR DECISION OF TODAY TO THE SECRETARY OF THE NAVY CONCERNING THIS DEBT. THIS DECISION HAS THE EFFECT OF MODIFYING OUR LETTER TO YOU DATED SEPTEMBER 8, 1971, AS CONCERNS THE CORRECT AMOUNT OF THE DEBT OUTSTANDING. THEREFORE, IN THE ABSENCE OF ANY REQUIREMENT THAT THE SETTLEMENT AGREEMENT AMOUNT BE PAID WITHOUT SETOFF OF ANY INDEBTEDNESS OF THE ADMIRAL CORPORATION TO THE UNITED STATES, IT IS REQUESTED THAT APPROPRIATE ACTION BE TAKEN BY YOUR DEPARTMENT TO ASSURE THAT THE APPROXIMATE SUM OF $272,611.59 WILL BE WITHHELD FROM PAYMENT UNDER THE SETTLEMENT AGREEMENT PENDING A FINAL DETERMINATION OF THE AMOUNT DUE THE UNITED STATES UNDER THE FOUR CONTRACTS CITED ABOVE. WE WOULD APPRECIATE BEING KEPT ADVISED OF ANY FURTHER DEVELOPMENTS IN REGARD TO THE SETTLEMENT AGREEMENT.