B-6391, OCTOBER 24, 1939, 19 COMP. GEN. 450

B-6391: Oct 24, 1939

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ADVERTISING - BIDS - QUALIFIED - LIMITATION ON LIABILITY FOR DELAYS AND DEFAULT PUBLIC CONTRACTS ARE FOR PERFORMANCE IN ACCORDANCE WITH THEIR TENOR AND PURPOSE IN THE PUBLIC INTEREST. 1939: I HAVE YOUR LETTER OF OCTOBER 4. STANDARD FORM 33 ( REVISED) HAVE HAD INSERTED THEREON THE FOLLOWING NOTICES FROM BIDDERS: "NEITHER PARTY TO THIS CONTRACT SHALL BE LIABLE IN ANY RESPECT FOR FAILURE OR DELAY IN THE FULFILLMENT OR PERFORMANCE OF THIS CONTRACT IF HINDERED OR PREVENTED. - "THAT THE CONTRACTOR SHALL NOT BE CHARGED WITH ANY EXCESS COST OCCASIONED THE GOVERNMENT BY THE PURCHASE OF MATERIALS OR SUPPLIES IN THE OPEN MARKET OR UNDER OTHER CONTRACTS WHEN THE DELAY OF THE CONTRACTOR IN MAKING DELIVERIES IS DUE TO UNFORESEEABLE CAUSES BEYOND THE CONTROL AND WITHOUT THE FAULT OR NEGLIGENCE OF THE CONTRACTOR.

B-6391, OCTOBER 24, 1939, 19 COMP. GEN. 450

ADVERTISING - BIDS - QUALIFIED - LIMITATION ON LIABILITY FOR DELAYS AND DEFAULT PUBLIC CONTRACTS ARE FOR PERFORMANCE IN ACCORDANCE WITH THEIR TENOR AND PURPOSE IN THE PUBLIC INTEREST, AND ASPIRANTS FOR GOVERNMENT BUSINESS MAY NOT BE PERMITTED TO LIMIT THEIR OWN RESPONSIBILITY OR RESTRICT THE GOVERNMENT'S REMEDIES SO UNDULY AS TO RENDER IT PRACTICALLY HELPLESS IN EVENT OF BREACH OF CONTRACT BY THE CONTRACTOR. A CONTRACT AWARDED TO A BIDDER WHO UNDULY LIMITS HIS OBLIGATION AS TO DELAYS AND DEFAULT BEYOND THE LIMITATION ON SUCH OBLIGATION IN THE GOVERNMENT'S INVITATION FOR BIDS, WOULD NOT BE THE CONTRACT OFFERED TO ALL BIDDERS, AND WOULD BE A MANIFEST INJUSTICE TO BIDDERS WILLING TO ACCEPT A CONTRACT UPON THE CONDITIONS OFFERED BY THE GOVERNMENT. STIPULATIONS BY BIDDERS RELATIVE TO EXCUSES FOR DEFAULT OR DELAY DIFFERING MATERIALLY FROM THE PROVISION RELATIVE TO EXCUSABLE DELAYS, CONDITION NO. 4, INCORPORATED IN STANDARD GOVERNMENT FORM 33, SHORT FORM CONTRACT, AND WHICH, IF ACCEPTED AS PART OF A CONTRACT, WOULD FURNISH THE CONTRACTOR IMMUNITY FROM RESPONSIBILITY OR LIABILITY TO THE GOVERNMENT FOR DEFAULT OR DELAY IN CONTRACT PERFORMANCE FROM ALMOST ANY CONCEIVABLE CAUSE, PRECLUDE ACCEPTANCE OF THEIR BIDS EVEN THOUGH OTHERWISE ACCEPTABLE.

COMPTROLLER GENERAL BROWN TO THE ADMINISTRATOR OF VETERANS' AFFAIRS, OCTOBER 24, 1939:

I HAVE YOUR LETTER OF OCTOBER 4, 1939, AS FOLLOWS:

RECENT PROPOSALS RECEIVED BY THE VETERANS' ADMINISTRATION IN RESPONSE TO INVITATIONS TO BID ISSUED ON U.S. STANDARD FORM 33 ( REVISED) HAVE HAD INSERTED THEREON THE FOLLOWING NOTICES FROM BIDDERS:

"NEITHER PARTY TO THIS CONTRACT SHALL BE LIABLE IN ANY RESPECT FOR FAILURE OR DELAY IN THE FULFILLMENT OR PERFORMANCE OF THIS CONTRACT IF HINDERED OR PREVENTED, DIRECTLY OR INDIRECTLY, BY WAR, CONDITIONS OF WAR, INADEQUATE TRANSPORTATION FACILITIES, FIRE, FLOODS, CYCLONES, OR OTHER AGENCIES OR ACTS OF GOD, OR STRIKES, LOCK-OUTS, GOVERNMENTAL INTERFERENCE, OR ANY OTHER CAUSE BEYOND THEIR REASONABLE CONTROL, WHETHER OF THE SAME KIND OR NOT.

"NEITHER PARTY TO THIS CONTRACT SHALL BE LIABLE IN ANY RESPECT FOR FAILURE OR DELAY IN THE FULFILLMENT OR PERFORMANCE OF THIS CONTRACT IF HINDERED DIRECTLY OR INDIRECTLY BY WAR, CONDITIONS OF WAR, INADEQUATE TRANSPORTATION, FIRE, FLOODS, CYCLONES, OTHER ACTS OF GOD, STRIKES, LOCK- OUTS, GOVERNMENT INTERFERENCE, OR ANY OTHER CAUSE BEYOND THEIR REASONABLE CONTROL, WHETHER OF THE SAME KIND OR NOT.'

INVITATION TO BID, U.S. STANDARD FORM 33 ( REVISED), PROVIDES UNDER CONDITION 4---

"THAT THE CONTRACTOR SHALL NOT BE CHARGED WITH ANY EXCESS COST OCCASIONED THE GOVERNMENT BY THE PURCHASE OF MATERIALS OR SUPPLIES IN THE OPEN MARKET OR UNDER OTHER CONTRACTS WHEN THE DELAY OF THE CONTRACTOR IN MAKING DELIVERIES IS DUE TO UNFORESEEABLE CAUSES BEYOND THE CONTROL AND WITHOUT THE FAULT OR NEGLIGENCE OF THE CONTRACTOR, INCLUDING, BUT NOT RESTRICTED TO, ACTS OF GOD OR OF THE PUBLIC ENEMY, ACTS OF THE GOVERNMENT, FIRES, FLOODS, EPIDEMICS, QUARANTINE RESTRICTIONS, STRIKES, FREIGHT EMBARGOES, UNUSUALLY SEVERE WEATHER, AND DELAYS OF A SUBCONTRACTOR * * * .'

INFORMATION IS, THEREFORE, REQUESTED AS TO WHETHER THE NOTICES ABOVE REFERRED TO ARE INCONSISTENT WITH THE PROVISIONS OF CONDITION 4 AND WOULD REQUIRE THE REJECTION OF PROPOSALS SO QUALIFIED.

IT IS READILY APPARENT UPON COMPARISON THAT THE TWO "NOTICES FROM BIDDERS" SET OUT IN YOUR LETTER--- DIFFERING SLIGHTLY IN PHRASEOLOGY, BUT SUBSTANTIALLY IDENTICAL IN IMPORT--- DIFFER MATERIALLY FROM THE PROVISION RELATIVE TO EXCUSABLE DELAYS, CONDITION NO. 4, INCORPORATED IN STANDARD GOVERNMENT FORM 33, SHORT-FORM CONTRACT, COMPRISING INVITATION, BID, AND ACCEPTANCE FORMS, AND GO FAR BEYOND ITS INTENT AND PURPOSE. THEIR TERMS ARE SO ALL INCLUSIVE THAT IF ACCEPTED AS PART OF A CONTRACT THEIR EFFECT WOULD BE TO FURNISH THE CONTRACTOR IMMUNITY FROM RESPONSIBILITY OR LIABILITY TO THE GOVERNMENT FOR DEFAULT OR DELAY IN CONTRACT PERFORMANCE FROM ALMOST ANY CONCEIVABLE CAUSE, NO MATTER HOW READILY FORESEEABLE OR REASONABLY TO BE ANTICIPATED AT THE TIME OF CONTRACTING, AND NO MATTER HOW REMOTE, INCIDENTAL, OR INDIRECT MIGHT BE ITS CONNECTION WITH OR EFFECT UPON PERFORMANCE OF THE CONTRACT.

PUBLIC CONTRACTS ARE FOR PERFORMANCE IN ACCORDANCE WITH THEIR TENOR AND PURPOSE IN THE PUBLIC INTEREST AND ASPIRANTS FOR GOVERNMENT BUSINESS MAY NOT BE PERMITTED TO LIMIT THEIR OWN RESPONSIBILITY OR RESTRICT THE GOVERNMENT'S REMEDIES SO UNDULY AS TO RENDER IT PRACTICALLY HELPLESS IN EVENT OF BREACH OF A CONTRACT BY THE CONTRACTOR. MOREOVER, A CONTRACT AWARDED TO A BIDDER WHO SO LIMITS HIS OBLIGATION WOULD NOT BE THE CONTRACT OFFERED TO ALL BIDDERS, AND WOULD BE A MANIFEST INJUSTICE TO BIDDERS WILLING TO ACCEPT A CONTRACT UPON THE CONDITIONS OFFERED BY THE GOVERNMENT AND TO ASSUME REASONABLE RESPONSIBILITY FOR HAZARDS UNDER GOVERNMENT CONTRACTS.

ACCORDINGLY, YOU ARE INFORMED THAT THE NOTICES FROM BIDDERS QUOTED IN YOUR LETTER RELATIVE TO EXCUSES FOR DEFAULT OR DELAY, OR STIPULATIONS SIMILAR THERETO IN ANY OTHER SUBMITTED BIDS, ARE SUCH AS TO PRECLUDE ACCEPTANCE OF THE BID EVEN THOUGH OTHERWISE ACCEPTABLE. SEE 8 COMP. GEN. 299; 13 ID. 169; 17 ID. 864; A-51799, NOVEMBER 13, 1933, TO YOU.