B-180648, MAY 17, 1974

B-180648: May 17, 1974

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SETTLEMENT CERTIFICATE PARTIALLY DISALLOWING CLAIM SUSTAINED WHEN CLAIMANT SELLER COULD NOT PRESENT SATISFACTORY EVIDENCE THAT MATERIAL WAS RECEIVED BY GOVERNMENT AS CALLED FOR UNDER TERMS OF F.O.B. REPRESENTING THE VALUE OF CERTAIN TIRES AND MATERIALS THAT WERE TO BE FURNISHED THE DEPARTMENT OF THE AIR FORCE. UNIROYAL'S CLAIM IS BASED UPON NON-PAYMENT BY THE AIR FORCE FOR ALLEGED DELIVERIES OF MATERIALS PURSUANT TO AIR FORCE CONTRACT F62562 68-C-0002. THE SETTLEMENT CERTIFICATE DENIED PAYMENT TO UNIROYAL ON THE BASIS THAT THERE WAS NO EVIDENCE TO INDICATE THAT GOODS BILLED ON A NUMBER OF UNIROYAL'S INVOICES WERE EVER ACTUALLY DELIVERED TO THE GOVERNMENT. CONTENDS THAT PROOF OF DELIVERY WAS FURNISHED FOR SIX OF THE DELIVERY ORDERS.

B-180648, MAY 17, 1974

SETTLEMENT CERTIFICATE PARTIALLY DISALLOWING CLAIM SUSTAINED WHEN CLAIMANT SELLER COULD NOT PRESENT SATISFACTORY EVIDENCE THAT MATERIAL WAS RECEIVED BY GOVERNMENT AS CALLED FOR UNDER TERMS OF F.O.B. DESTINATION CONTRACT.

TO UNIROYAL INTERNATIONAL:

BY LETTER OF JANUARY 17, 1974, UNIROYAL INTERNATIONAL (UNIROYAL), REQUESTED RECONSIDERATION OF OUR SETTLEMENT OF NOVEMBER 28, 1973, WHICH PARTIALLY DISALLOWED A CLAIM IN THE AMOUNT OF $14,830.81, REPRESENTING THE VALUE OF CERTAIN TIRES AND MATERIALS THAT WERE TO BE FURNISHED THE DEPARTMENT OF THE AIR FORCE.

UNIROYAL'S CLAIM IS BASED UPON NON-PAYMENT BY THE AIR FORCE FOR ALLEGED DELIVERIES OF MATERIALS PURSUANT TO AIR FORCE CONTRACT F62562 68-C-0002. THE SUBJECT CONTRACT APPARENTLY CALLED FOR SHIPMENTS OF VARIOUS PRODUCTS PURSUANT TO INSTRUCTION BY DELIVERY ORDERS. UNIROYAL HAS REQUESTED THIS OFFICE'S RECONSIDERATION OF ITS DISALLOWANCE OF CLAIMS UNDER SIX DELIVERY ORDERS, TOTALING $3,184.82, ISSUED PURSUANT TO THE CONTRACT.

THE SETTLEMENT CERTIFICATE DENIED PAYMENT TO UNIROYAL ON THE BASIS THAT THERE WAS NO EVIDENCE TO INDICATE THAT GOODS BILLED ON A NUMBER OF UNIROYAL'S INVOICES WERE EVER ACTUALLY DELIVERED TO THE GOVERNMENT. UNIROYAL, IN ITS REQUEST FOR RECONSIDERATION, CONTENDS THAT PROOF OF DELIVERY WAS FURNISHED FOR SIX OF THE DELIVERY ORDERS.

THE RECORD FORWARDED TO THIS OFFICE INDICATES THAT A THREE-YEAR CONCENTRATED EFFORT BY UNIROYAL AND AIR FORCE PERSONNEL TO LOCATE RECEIVING REPORTS OR CERTIFICATES OF RECEIPT HAS BEEN IN VAIN. WITHOUT PROOF OF DELIVERY, WE BELIEVE THAT THE AIR FORCE CORRECTLY DENIED PAYMENT ON THE SUBJECT INVOICES. B-128632, AUGUST 2, 1956.

THE SUBJECT CONTRACT CALLED FOR DELIVERY F.O.B. DESTINATION. THE LONG ACCEPTED ORDINARY BUSINESS SIGNIFICANCE OF THE TERM "F.O.B." IS THAT THE SELLER WILL DELIVER THE GOODS AT THE DESIGNATED POINT WITHOUT A CHARGE FOR PRIOR TRANSPORTATION SERVICE. BROOKS - SCANLON CO. V. ILLINOIS CENTRAL RAILROAD CO., 257 FED. 235 (5TH CIR. 1919). THE TERM "F.O.B. DESTINATION" HAS A BROADER MEANING THAT REQUIRES THE SELLER TO MAKE DELIVERY TO THE BUYER AT THE DESTINATION POINT BEFORE TITLE PASSES. LARRY LIGHTNER, INC. V. UNITED STATES, 213 F.2D 449 (5TH CIR. 1954). SEE ALSO 3 WILLISTON ON SALES, 4TH ED., SEC 23-1; UNIFORM COMMERCIAL CODE SEC 2-319(1)(B).

THE SIGNED DELIVERY RECEIPTS ALLEGED BY UNIROYAL TO HAVE BEEN FURNISHED FOR THE SIX ORDERS ARE IN FACT ITEMS SUCH AS PROOF OF LANDING, EVIDENCE OF TRANSHIPMENT AND EVIDENCE OF PACKING AND INSPECTION. AS NOTED ABOVE, THE SELLER DOES NOT COMPLETE HIS CONTRACTUAL OBLIGATION UNDER F.O.B. DESTINATION DELIVERY TERMS UNTIL THE MERCHANDISE REACHES THE APPROPRIATE DESTINATION.

SINCE THE RECORD DOES NOT CONTAIN ANY SATISFACTORY EVIDENCE SHOWING THAT THE MATERIAL WAS RECEIVED BY THE GOVERNMENT, UNIROYAL IS NOT ENTITLED TO PAYMENT UNDER THE SIX DELIVERY ORDERS. COMPARE B-160313, NOVEMBER 17, 1966.

THEREFORE, THE SETTLEMENT DISALLOWING THE SUBJECT CLAIM IS SUSTAINED.