B-173995, DEC 29, 1971

B-173995: Dec 29, 1971

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TO WESTINGHOUSE ELECTRIC CORPORATION: REFERENCE IS MADE TO YOUR LETTER OF AUGUST 30. PARAGRAPH 3 OF THE CONTRACT STATED: "THE MAXIMUM AMOUNT FOR WHICH THE GOVERNMENT SHALL BE LIABLE IF THIS CONTRACT IS TERMINATED IS TWENTY THOUSAND DOLLARS ($20. THIS AMOUNT WAS INCREASED TO $22. PARAGRAPH 4 OF THE CONTRACT PROVIDED FOR TERMINATION IN THE EVENT THE CONTRACT WAS NOT DEFINITIZED BY JULY 13. WESTINGHOUSE WAS REQUESTED TO SIGN THREE COPIES OF SA PZ01 AND RETURN THEM TO THE AIR FORCE. STANDARD FORM 30 WAS THE FIRST PAGE OF THE SUPPLEMENTAL AGREEMENT. THE CONTRACTING OFFICER NOTIFIED WESTINGHOUSE THAT ITS CONTRACT: " *** IS HEREBY TERMINATED FOR THE CONVENIENCE OF THE GOVERNMENT. IN ACCORDANCE WITH THE CLAUSE HEREOF ENTITLED 'TERMINATION FOR THE CONVENIENCE OF THE GOVERNMENT.' *** ' THE BASIS OF YOUR PROTEST IS THAT IN NEGOTIATING A TERMINATION SETTLEMENT.

B-173995, DEC 29, 1971

CONTRACTS - TERMINATION SETTLEMENT - DISPUTES CLAUSE NOTIFICATION OF PROPER APPEALS PROCEDURE IN CONNECTION WITH A PROTEST BY WESTINGHOUSE ELECTRIC CORPORATION CONCERNING THE AIR FORCE'S REFUSAL TO NEGOTIATE FOLLOWING A TERMINATION FOR CONVENIENCE OF A LETTER CONTRACT. SINCE THE DISPUTES CLAUSE OF THE CONTRACT PROVIDES FOR APPEAL FROM ANY DETERMINATION BY THE CONTRACTING OFFICER, THE COMP. GEN. MAY ONLY REVIEW THIS CLAIM AFTER A FINAL ADMINISTRATIVE DECISION HAS BEEN RENDERED.

TO WESTINGHOUSE ELECTRIC CORPORATION:

REFERENCE IS MADE TO YOUR LETTER OF AUGUST 30, 1971, AND SUBSEQUENT CORRESPONDENCE, PROTESTING AGAINST THE REFUSAL OF THE AIR FORCE TO NEGOTIATE A TERMINATION SETTLEMENT IN EXCESS OF $20,000 FOLLOWING THE TERMINATION FOR CONVENIENCE OF LETTER CONTRACT F30602-69-C-0355.

ON MAY 29, 1969, YOUR FIRM RECEIVED LETTER CONTRACT F30602-69-C-0355 FROM THE ROME AIR DEVELOPMENT CENTER, GRIFFISS AIR FORCE BASE, NEW YORK. PARAGRAPH 3 OF THE CONTRACT STATED: "THE MAXIMUM AMOUNT FOR WHICH THE GOVERNMENT SHALL BE LIABLE IF THIS CONTRACT IS TERMINATED IS TWENTY THOUSAND DOLLARS ($20,000.00)." BY AMENDMENT, THIS AMOUNT WAS INCREASED TO $22,000. PARAGRAPH 4 OF THE CONTRACT PROVIDED FOR TERMINATION IN THE EVENT THE CONTRACT WAS NOT DEFINITIZED BY JULY 13, 1969, OR UPON THE COMPLETION OF 50 PERCENT OF THE WORK, WHICHEVER OCCURRED FIRST.

BY LETTER OF JULY 2, 1969, THE CONTRACTING OFFICER SUBMITTED TO WESTINGHOUSE FOR EXECUTION SUPPLEMENTAL AGREEMENT PZ01 (SA PZ01) TO THE ABOVE-REFERENCED CONTRACT. THE SUPPLEMENTAL AGREEMENT INCREASED THE CONTRACT PRICE TO $95,600. WESTINGHOUSE WAS REQUESTED TO SIGN THREE COPIES OF SA PZ01 AND RETURN THEM TO THE AIR FORCE, WHEREUPON "A COMPLETELY EXECUTED COPY" WOULD BE FURNISHED WESTINGHOUSE. STANDARD FORM 30 WAS THE FIRST PAGE OF THE SUPPLEMENTAL AGREEMENT. WHILE THE CONTRACTING OFFICER'S SIGNATURE ACCOMPANIED A STATEMENT REGARDING THE SECURITY CLASSIFICATION OF THE CONTRACT IN BLOCK 12 THEREOF, HIS SIGNATURE DID NOT APPEAR IN BLOCK 17. WESTINGHOUSE RETURNED THE EXECUTED COPIES OF SA PZ01 TO THE CONTRACTING OFFICER.

IN A LETTER OF SEPTEMBER 23, 1969, THE CONTRACTING OFFICER NOTIFIED WESTINGHOUSE THAT ITS CONTRACT:

" *** IS HEREBY TERMINATED FOR THE CONVENIENCE OF THE GOVERNMENT, IN ACCORDANCE WITH THE CLAUSE HEREOF ENTITLED 'TERMINATION FOR THE CONVENIENCE OF THE GOVERNMENT.' *** '

THE BASIS OF YOUR PROTEST IS THAT IN NEGOTIATING A TERMINATION SETTLEMENT, THE AIR FORCE HAS TAKEN THE POSITION THAT SA PZ01, WHICH WAS NEVER SIGNED BY THE CONTRACTING OFFICER, DID NOT BECOME EFFECTIVE AND THAT WESTINGHOUSE'S ONLY RIGHTS LIE UNDER THE LETTER CONTRACT.

IT APPEARS THAT THE DISPUTE OVER THE AMOUNT OF THE TERMINATION SETTLEMENT TO WHICH YOUR FIRM IS ENTITLED IS FOR DETERMINATION UNDER THE "TERMINATION FOR CONVENIENCE OF THE GOVERNMENT" CLAUSE OF YOUR CONTRACT. PARAGRAPH (E) THEREOF PROVIDES FOR THE DETERMINATION BY THE CONTRACTING OFFICER OF THE AMOUNT TO BE PAID THE CONTRACTOR IN THE EVENT OF THE FAILURE OF THE CONTRACTOR AND CONTRACTING OFFICER TO AGREE ON A SETTLEMENT. PARAGRAPH (G) FURTHER PROVIDES THAT:

"THE CONTRACTOR SHALL HAVE THE RIGHT OF APPEAL, UNDER THE CLAUSE OF THIS CONTRACT ENTITLED 'DISPUTES', FROM ANY DETERMINATION MADE BY THE CONTRACTING OFFICER UNDER PARAGRAPH *** (E) ABOVE *** ."

ACCORDINGLY, WE MUST ADVISE YOU THAT THE MATTER IS INITIALLY FOR RESOLUTION BY THE AGENCY UNDER THE DISPUTES CLAUSE OF THE CONTRACT. YOU ARE UNSUCCESSFUL IN ANY CLAIM PRESENTED THROUGH THE ADMINISTRATIVE PROCESS, AND YOU BELIEVE THAT THE FINAL ADMINISTRATIVE DECISION IS ERRONEOUS IN POINT OF FACT OR LAW, THIS OFFICE MAY THEN BE REQUESTED TO REVIEW YOUR CLAIM ACCORDING TO THE STANDARDS OF THE WUNDERLICH ACT, 41 U.S.C. 321, 322.