B-61137, OCTOBER 29, 1946, 26 COMP. GEN. 280

B-61137, OCTOBER 29, 1946, 26 COMP. GEN. 280

CONTRACTS - DAMAGES - LIQUIDATED - DELAYS DUE TO STRIKES UNDER A SUPPLY CONTRACT PROVIDING FOR THE ASSESSMENT OF LIQUIDATED DAMAGES IN EVENT OF THE CONTRACTOR'S DEFAULT IN MEETING ITS SHIPPING SCHEDULE, BUT CONTAINING NO PROVISION FOR EXCUSING THE CONTRACTOR FOR DELAY IN PERFORMANCE FOR ANY CAUSE, THERE IS NO LEGAL BASIS FOR GRANTING AN EXTENSION OF TIME WITHOUT THE ASSESSMENT OF LIQUIDATED DAMAGES BECAUSE OF A DELAY OCCASIONED BY THE CONTRACTOR'S INABILITY TO TRANSPORT NECESSARY MATERIAL FROM A WAREHOUSE TO ITS PLANT DUE TO A TRUCKING STRIKE--- A CAUSE NOT SHOWN TO BE ATTRIBUTABLE TO AN ACT OF GOD, THE LAW, OR THE OTHER PARTY.

COMPTROLLER GENERAL WARREN TO THE PUBLIC PRINTER, OCTOBER 29, 1946:

REFERENCE IS MADE TO YOUR LETTER OF OCTOBER 3, 1946, WITH ENCLOSURE WHEREIN YOU REQUEST DECISION AS TO WHETHER, ON THE BASIS OF THE FACTS AS OUTLINED IN A LETTER DATED SEPTEMBER 11, 1946, FROM CONSOLIDATED BUSINESS SYSTEMS, INC., THE GOVERNMENT PRINTING OFFICE IS AUTHORIZED TO EXTEND THE TIME OF PERFORMANCE OF CONTRACT NO. GP-22273, ENTERED INTO WITH THAT COMPANY. THE SAID LETTER OF SEPTEMBER 11 IS AS FOLLOWS:

THIS IS TO CONFIRM TODAY'S TELEPHONE CONVERSATION WITH MR. L. W. PANNETON TO THE EFFECT THAT WE ARE PREPARED TO PUT THE ORDER COVERED BY THE ABOVE JACKET NUMBER IN WORK AT THE PRESENT TIME, EXCEPT THAT DUE TO THE PRESENTLY PREVAILING TRUCKING STRIKE IN THE CITY OF NEW YORK, WE ARE UNABLE TO MOVE THE NECESSARY PAPER STOCK FOR THIS JOB FROM THE WAREHOUSE TO OUR PRINTING PLANT.

THIS IS A SITUATION OVER WHICH WE HAVE NO CONTROL AND MOVEMENT OF THE PAPER STOCK BY OUR OWN VEHICLE IS BEING PREVENTED BY THE STRIKING TRUCKMEN. UNDER THE CIRCUMSTANCES, IT IS DOUBTFUL WHETHER WE WILL BE ABLE TO MEET THE PROMISED DELIVERY DATE OF THIS ORDER IN WASHINGTON BY OCTOBER 4TH, ALTHOUGH WE WILL DO ALL IN OUR POWER TO EFFECT DELIVERY BY THAT DATE.

IT WAS SUGGESTED IN THE COURSE OF THE TELEPHONE CONVERSATION THAT POSSIBLY A GOVERNMENT VEHICLE MAY BE PLACED AT OUR DISPOSAL IN ORDER TO HAUL THE PAPER STOCK FROM THE WAREHOUSE TO THE PRINTING PLANT. IF SUCH AN ARRANGEMENT SHOULD BE POSSIBLE, PLEASE LET US KNOW WITHOUT DELAY.

IT WOULD BE APPRECIATED IF SOME CONFIRMATION REGARDING THE ABOVE EXPLAINED SITUATION COULD BE ISSUED TO US BY YOUR OFFICE.

UNDER THE TERMS OF THE CONTRACT, CONSOLIDATED BUSINESS SYSTEMS, INC., AGREED TO FURNISH A QUANTITY OF PRINTED FORMS DURING THE PERIOD BEGINNING JULY 1, 1946, AND ENDING DECEMBER 31, 1946. WITH RESPECT TO DELIVERIES, THE SPECIFICATIONS AND SPECIAL TERMS FOR PRINTING, ATTACHED TO THE CONTRACT, PROVIDE THAT LIQUIDATED DAMAGES OF $5 PER DAY WILL BE ASSESSED AGAINST THE CONTRACTOR IF IN DEFAULT OF THE SHIPPING SCHEDULE AGREED TO AT THE TIME THE ORDER IS PLACED. ARTICLE 17 OF UNITED STATES GOVERNMENT PRINTING OFFICE CONTRACT TERMS NO. 1, INCORPORATED BY REFERENCE IN THE SUBJECT AGREEMENT, PROVIDES AS FOLLOWS:

ARTICLE 17. LIQUIDATED DAMAGES.--- WHERE DAMAGES FOR DELAYS ARE TO BE CHARGED, THE GOVERNMENT WILL DEDUCT AS LIQUIDATED DAMAGES, AND NOT BY WAY OF PENALTY, FROM ANY PAYMENT DUE THE CONTRACTOR A PERCENTAGE OF THE VALUE OF THE UNDELIVERED WORK AT THE RATE INDICATED IN THE ORDER FOR EACH DAY OR FRACTION THEREOF FROM THE TIME DELIVERY WAS DUE TO THE ACTUAL DATE OF DELIVERY. LIQUIDATED DAMAGES WILL BE CHARGED ONLY WHEN INDICATED.

THUS, IT APPEARS THAT THE CONTRACT, AS EXECUTED, MAKES NO PROVISION FOR EXCUSING THE CONTRACTOR FOR DELAYS IN PERFORMANCE FOR ANY CAUSES. IN THIS CONNECTION, IT MAY BE POINTED OUT THAT SINCE THE CONTRACTOR APPARENTLY HAS NOT BEEN DECLARED IN DEFAULT OF ITS CONTRACT, THERE IS NOT NOW FOR CONSIDERATION ARTICLE 16 OF THE AFOREMENTIONED CONTRACT TERMS NO. 1, TO WHICH YOU HAVE REFERRED INFORMALLY, AND WHICH HAS TO DO GENERALLY WITH THE PURCHASE AGAINST THE CONTRACTOR'S ACCOUNT AND THE COLLECTION OF SUCH EXCESS COSTS AS MIGHT RESULT THEREFROM.

THE COURTS HAVE HELD CONSISTENTLY THAT IF A PARTY CHARGES HIMSELF WITH AN OBLIGATION WHICH AT THE TIME WAS POSSIBLE OF PERFORMANCE, HE MUST ABIDE BY IT UNLESS PERFORMANCE IS RENDERED IMPOSSIBLE BY AN ACT OF GOD, BY THE LAW, OR BY THE OTHER PARTY. UNFORESEEN DIFFICULTIES, HOWEVER GREAT, WILL NOT EXCUSE PERFORMANCE, UNLESS THE CONTRACT SO PROVIDES. WHERE THE PARTIES HAVE MADE NO PROVISION FOR A DISPENSATION THE TERMS OF THE CONTRACT MUST PREVAIL. 11 COMP. GEN. 112, AND COURT CASES THERE CITED. OBVIOUSLY, IN THE INSTANT CASE, THE DELAY IS NOT SHOWN TO HAVE BEEN CAUSED BY AN ACT OF GOD, THE LAW, OR BY THE GOVERNMENT. ON THE CONTRARY, THE DELAY ADMITTEDLY HAS BEEN OCCASIONED BY A TRUCKING STRIKE IN THE CITY OF NEW YORK WHICH, UNDER THE TERMS OF THE CONTRACT, CANNOT BE CLASSED AS AN EXCUSABLE CAUSE FOR REMISSION OF SUCH LIQUIDATED DAMAGES AS MAY ACCRUE. THE RIGHT HAVING VESTED IN THE UNITED STATES TO HAVE PERFORMANCE STRICTLY IN ACCORDANCE WITH THE CONTRACT TERMS, NO OFFICER OR EMPLOYEE OF THE GOVERNMENT HAS AUTHORITY TO MODIFY SUCH TERMS EXCEPT IN THE INTEREST OF THE GOVERNMENT. CHRISTIE V. UNITED STATES, 237 U.S. 234; SHIPMAN V. DISTRICT OF COLUMBIA, 18 C.1CLS. 291; BAUSCH AND LOMB OPTICAL COMPANY V. UNITED STATES, 78 C.1CLS. 584, 607.

ACCORDINGLY, IN SPECIFIC ANSWER TO THE QUESTION PRESENTED, YOU ARE ADVISED THAT THERE IS PERCEIVED NO LEGAL BASIS FOR ANY EXTENSION OF TIME IN THE PERFORMANCE OF THE CONTRACT INVOLVED WITHOUT THE ASSESSMENT OF LIQUIDATED DAMAGES AS PROVIDED FOR IN THE CONTRACT.