B-182093, NOV 14, 1974

B-182093: Nov 14, 1974

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WHERE ACTIVITY PERSONNEL IN GOOD FAITH CATALOGUED CONDITION OF GENERATOR AS "REBUILT-FAIR" ACCORDING TO BEST POSSIBLE INFORMATION AVAILABLE AND WHERE GENERATOR WAS OFFERED FOR SALE ON AN "AS IS" AND "WHERE IS" BASIS. FACT THAT ITEM IS FOUND TO BE UNWORKABLE AFTER PURCHASE DOES NOT PERMIT RESCISSION OF CONTRACT. WAS DESCRIBED IN THE SALES LITERATURE AS "REBUILT-FAIR" AND WITH A PURCHASE VALUE OF $2. CLAIMANT DISASSEMBLED THE GENERATOR AND FOUND THAT A CONNECTING ROD WAS BROKEN. THE CRANKSHAFT WAS BEYOND REPAIR. A CYLINDER WAS BADLY SCORED CLAIMANT. IT APPEARS THAT THE GENERATOR WAS ERRONEOUSLY TURNED IN TO THE ACTIVITY FOR SALE. WHEN TURNED IN THE DIP STICK OF THE GENERATOR INDICATED THE OIL WAS CLEAN (AND THUS THE GENERATOR WAS BELIEVED TO BE OPERABLE).

B-182093, NOV 14, 1974

WHERE ACTIVITY PERSONNEL IN GOOD FAITH CATALOGUED CONDITION OF GENERATOR AS "REBUILT-FAIR" ACCORDING TO BEST POSSIBLE INFORMATION AVAILABLE AND WHERE GENERATOR WAS OFFERED FOR SALE ON AN "AS IS" AND "WHERE IS" BASIS, WITHOUT WARRANTY, FACT THAT ITEM IS FOUND TO BE UNWORKABLE AFTER PURCHASE DOES NOT PERMIT RESCISSION OF CONTRACT.

CLAIM OF MR. ROBERT PALK:

MR. ROBERT PALK, CLAIMANT, PURCHASED FOR $125.01 ITEM NO. 4 UNDER SALES INVITATION FOR BIDS NO. 60-4028, ISSUED BY THE DEFENSE PROPERTY DISPOSAL SERVICE, PEARL CITY, HAWAII. ITEM NO. 4, A GENERATOR, WAS DESCRIBED IN THE SALES LITERATURE AS "REBUILT-FAIR" AND WITH A PURCHASE VALUE OF $2,937. AFTER RECEIPT OF THE ITEM, CLAIMANT DISASSEMBLED THE GENERATOR AND FOUND THAT A CONNECTING ROD WAS BROKEN, THE CRANKSHAFT WAS BEYOND REPAIR, AND A CYLINDER WAS BADLY SCORED CLAIMANT, CONSEQUENTLY, REQUESTS THAT THE $125.01 HE PAID FOR THE GENERATOR BE REFUNDED TO HIM.

FROM THE RECORD, IT APPEARS THAT THE GENERATOR WAS ERRONEOUSLY TURNED IN TO THE ACTIVITY FOR SALE. HOWEVER, WHEN TURNED IN THE DIP STICK OF THE GENERATOR INDICATED THE OIL WAS CLEAN (AND THUS THE GENERATOR WAS BELIEVED TO BE OPERABLE), AND THE EXTERIOR OF THE GENERATOR WAS SUCH THAT THE DESCRIPTION OF ITS CONDITION IN THE SALES LITERATURE APPEARED TO BE A CORRECT STATEMENT OF THE FACTS. SINCE NO TURN-IN DOCUMENTS OR TAGS HAD BEEN RECEIVED WITH OR ON THE GENERATOR, EXCEPT THAT A "REBUILT" STICKER WAS ATTACHED TO THE ITEM, THE GENERATOR WAS, IN VIEW OF THE ABOVE- MENTIONED FACTS, CATALOGUED AS IN FAIR CONDITION. THERE IS NO INDICATION THAT PERSONNEL AT THE ACTIVITY KNEW, OR HAD ANY REASON TO KNOW, OF THE TRUE CONDITION OF THE GENERATOR. THIS WAS DISCOVERED ONLY AFTER CLAIMANT HAD DISMANTLED IT. THUS, WE CANNOT SAY THAT THERE WAS ANY BAD FAITH (OR SUCH GROSS NEGLIGENCE AS NECESSARILY TO IMPLY BAD FAITH) ON THE PART OF ACTIVITY PERSONNEL IN SO DESCRIBING THE CONDITION OF THE GENERATOR.

THE INVITATION IN ITS CONDITIONS OF SALES REFERENCED THE DISPOSAL DEPARTMENT, NAVAL SUPPLY CENTER PAMPHLET, DATED MAY 1972, AND ENTITLED SALE BY REFERENCE-INFORMATION, INSTRUCTIONS, CONDITIONS AND TERMS FOR MILITARY SURPLUS PERSONAL PROPERTY IN HAWAII, AS BEING APPLICABLE TO THE SALE. PART 2, ARTICLE 2, "CONDITION AND LOCATION OF PROPERTY, OF THAT PAMPHLET PROVIDED THE FOLLOWING:

"UNLESS OTHERWISE SPECIFICALLY PROVIDED IN THE INVITATION, ALL PROPERTY LISTED THEREIN IS OFFERED FOR SALE 'AS IS' AND 'WHERE IS.' THE DESCRIPTION OF THE PROPERTY IS BASED ON THE BEST INFORMATION AVAILABLE TO THE SALES OFFICE. HOWEVER, UNLESS OTHERWISE SPECIFICALLY PROVIDED IN THE INVITATION, THE GOVERNMENT MAKES NO WARRANTY, EXPRESS OR IMPLIED, AS TO QUANTITY, KIND, CHARACTER, QUALITY, WEIGHT, SIZE, OR DESCRIPTION OF ANY OF THE PROPERTY, OR ITS FITNESS FOR ANY USE OR PURPOSE AND EXCEPT AS PROVIDED IN CONDITIONS NO. 12 AND 14 OR OTHER SPECIAL CONDITIONS OF THE INVITATION, NO REQUEST FOR ADJUSTMENT IN PRICE OR FOR RECISSION OF THE SALE WILL BE CONSIDERED. THIS IS NOT A SALE BY SAMPLE."

NONE OF THE SPECIAL CONDITIONS OR EXCEPTIONS REFERENCED ABOVE HAS ANY BEARING ON THE PRESENT CASE. RECISSION OF A SURPLUS SALES CONTRACT CONTAINING THE ABOVE DISCLAIMER OF WARRANTY CANNOT BE GRANTED WHERE THE SALES ACTIVITY HAD NO KNOWLEDGE OF SUCH MISDESCRIPTION AND USED THE BEST INFORMATION AVAILABLE IN DESCRIBING THE PROPERTY IN THE SALES DOCUMENT. LIPSHITZ & COHEN V. UNITED STATES, 269 U.S. 90 (1925); ALLOYS AND CHEMICALS CORPORATION V. UNITED STATES, 163 CT. CL. 229 (1963); 52 COMP. GEN. 698 (1973).

CONSEQUENTLY, WE FIND NO LEGAL BASIS TO GRANT A RESCISSION OF THE CONTRACT AND A REFUND OF CLAIMANT'S PRICE ON ITEM NO. 4.