B-177922, MAR 8, 1973

B-177922: Mar 8, 1973

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SINCE THERE IS A DISPUTE BETWEEN THE CONTRACTOR AND CONTRACTING OFFICER CONCERNING AN ADDITIONAL PAYMENT DUE FOR UNPRICED PARTS. TO DEWEY ELECTRONICS CORPORATION: RECEIPT IS ACKNOWLEDGED OF YOUR LETTER OF JANUARY 23. THAT THE ENTIRE REPLACEMENT LIST WAS ATTACHED TO THE AMENDMENT. THAT INDIVIDUAL PRICES WERE SET FORTH IN THE LIST FOR ONLY SOME OF THE PARTS. YOU MAINTAIN THAT THE LUMP-SUM PRICE COVERS ONLY PARTS FOR WHICH INDIVIDUAL PRICES WERE SET FORTH ON THE LIST. THAT A PROPER REVIEW OF THE AMENDMENT AND ATTACHMENT WOULD LEAD TO A DECISION THAT ONLY THE PRICED LINE ITEMS WERE COVERED BY THE AMENDMENT. YOU INDICATE THAT THE CONTRACTING OFFICER'S INTERPRETATION IS ERRONEOUS.

B-177922, MAR 8, 1973

CONTRACT - REFORMATION-PAYMENT DISPUTE CONCERNING THE REQUEST OF DEWEY ELECTRONICS CORPORATION THAT GAO AUTHORIZE REFORMATION OF A CONTRACT AWARDED BY THE U.S. MARINE CORPS FOR THE REPAIR AND INSPECTION OF 20 RADAR SETS. SINCE THERE IS A DISPUTE BETWEEN THE CONTRACTOR AND CONTRACTING OFFICER CONCERNING AN ADDITIONAL PAYMENT DUE FOR UNPRICED PARTS, THIS MATTER SHOULD BE RESOLVED UNDER THE DISPUTES CLAUSE OF THE CONTRACT PRIOR TO ANY CONSIDERATION OF REFORMATION BY GAO.

TO DEWEY ELECTRONICS CORPORATION:

RECEIPT IS ACKNOWLEDGED OF YOUR LETTER OF JANUARY 23, 1973, REQUESTING THAT WE AUTHORIZE THE REFORMATION OF YOUR CONTRACT NO. M00027-69-C-0204 FOR THE REPAIR AND INSPECTION OF 20 RADAR SETS.

YOU STATE THAT YOUR CONCERN PREPARED A MATERIAL REPLACEMENT LIST FOR REPAIR PARTS NEEDED UNDER THE CONTRACT; THAT YOU PURCHASED QUANTITIES OF PARTS FROM THIS LIST DURING PERFORMANCE OF THE CONTRACT; AND THAT YOU SUBSEQUENTLY NEGOTIATED A FIRM PRICE WITH THE GOVERNMENT FOR SOME OF THE PURCHASED PARTS. YOU FURTHER STATE THAT ON JANUARY 26, 1972, THE GOVERNMENT ISSUED AMENDMENT NO. A00006 TO THE CONTRACT; THAT THE ENTIRE REPLACEMENT LIST WAS ATTACHED TO THE AMENDMENT; THAT INDIVIDUAL PRICES WERE SET FORTH IN THE LIST FOR ONLY SOME OF THE PARTS; THAT THE FIRST PAGE OF THE AMENDMENT SET FORTH A LUMP-SUM PRICE OF $481,305.00, REFLECTING THE TOTAL OF THE INDIVIDUAL PRICES; AND THAT THE CONTRACTING OFFICER HAS RECENTLY DENIED YOUR CLAIM FOR ADDITIONAL COMPENSATION FOR SOME OF THE REMAINING, UNPRICED PARTS ON THE LIST AND STATED THAT THE WORDING OF THE AMENDMENT COULD MEAN THAT THE LUMP-SUM PRICE COVERED THE COMPENSATION TO BE PAID FOR ALL PARTS ON THE LIST, BOTH PRICED AND UNPRICED.

YOU MAINTAIN THAT THE LUMP-SUM PRICE COVERS ONLY PARTS FOR WHICH INDIVIDUAL PRICES WERE SET FORTH ON THE LIST; THAT THE RECORDS OF THE GOVERNMENT PERSONNEL WHO NEGOTIATED THE AMENDMENT AND YOUR COMPANY SUPPORT YOUR INTERPRETATION; THAT THE CONTRACTING OFFICER'S INTERPRETATION OF THE AMENDMENT RELIES ON LANGUAGE WHICH DOES NOT RELATE TO THE DOLLAR AMOUNTS INVOLVED HERE; THAT A PROPER REVIEW OF THE AMENDMENT AND ATTACHMENT WOULD LEAD TO A DECISION THAT ONLY THE PRICED LINE ITEMS WERE COVERED BY THE AMENDMENT; AND THAT THE GOVERNMENT SHOULD THEREFORE PAY ADDITIONAL COMPENSATION FOR THE UNPRICED PARTS ON THE LIST.

ALTHOUGH YOU REQUEST REFORMATION OF THE CONTRACT ON THE BASIS THAT THE WORDING OF THE AMENDMENT DID NOT PRECISELY REFLECT THE INTENT OF THE PARTIES WITH RESPECT TO COVERAGE OF THE UNPRICED PARTS ON THE LIST, WE NOTE THAT YOU ALSO ARGUE THAT A PROPER INTERPRETATION OF THE EXPRESS LANGUAGE OF THE AMENDMENT WOULD SUPPORT YOUR CLAIM FOR PAYMENT FOR UNPRICED PARTS ON THE LIST, AND YOU INDICATE THAT THE CONTRACTING OFFICER'S INTERPRETATION IS ERRONEOUS. ON THIS RECORD WE BELIEVE THAT A DISPUTE, ARISING UNDER THE CONTRACT, EXISTS BETWEEN YOU AND THE CONTRACTING OFFICER CONCERNING THE ADDITIONAL PAYMENT, IF ANY, OWED TO YOU FOR UNPRICED PARTS ON THE LIST; THAT THIS DISPUTE SHOULD BE RESOLVED PRIOR TO ANY CONSIDERATION OF YOUR REQUEST FOR REFORMATION BY THIS OFFICE; AND THAT THE DISPUTES CLAUSE OF YOUR CONTRACT SETS FORTH THE PROCEDURES FOR FINALLY RESOLVING THIS DISAGREEMENT.

IF AND WHEN YOU EXHAUST YOUR REMEDIES UNDER THE DISPUTES CLAUSE OF YOUR CONTRACT, AND OBTAIN A FINAL DECISION DENYING YOUR CLAIM AND YOUR INTERPRETATION OF THE LANGUAGE IN QUESTION, YOU MAY REQUEST OUR FURTHER CONSIDERATION OF YOUR REQUEST.