Reconsideration of Claim for Breach of Federal Supply Service Contract

B-192242: Jul 9, 1979

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McClane Enterprises requested reconsideration of a prior decision which denied its claim for breach of a Federal Supply Service (FSS) contract issued by the General Services Administration (GSA). The contract was a requirements-type contract for tree marking paint listed on a multiple FSS schedule. The decision ruled that since GSA made no promise or guarantee to McClane with respect to the volume of expected sales, GSA did not breach McClane's contract. GAO was concerned with the propriety of the Forest Service ordering tree marking paint from Nelson Paint Co. which was priced higher than McClane's paint. The higher priced paint was also listed on the FSS schedule; however, it contained a tracer element developed for Government use. GAO held that the Forest Service did not breach McClane's contract as the tracer element was needed. In the request for reconsideration, McClane contended that GSA accepted the paint described in its contract as satisfying any and all the needs of the Government and if GSA was aware of a special need for paint with a tracer element, it should have issued a solicitation for such a paint. GAO held that an award of a FSS award contract does not constitute acceptance of contractor's article as satisfying minimum needs of agencies ordering from the FSS schedule. GSA did not breach the FSS award where the solicitation expressly provided that no guarantee was given that any quantities would be purchased. GAO recommended that GSA determine the possibility of drafting specifications for tracer element paint and formally advertise. The prior denial was sustained.