B-163005, SEP. 30, 1968

B-163005, SEP. 30, 1968

TO M. PASHELINSKY AND SONS:

REFERENCE IS MADE TO THE LETTER OF JUNE 25, 1968, AND ENCLOSED BRIEF, REQUESTING RECONSIDERATION OF OUR DECISION, B-163005, APRIL 2, 1968, 47 COMP. GEN. -----, WHICH DENIED THE CLAIM OF M. PASHELINSKY AND SONS ARISING OUT OF ITEM NO. 7 FOR THE SALE OF "REFINED NICKEL PIGS" PURSUANT TO A SOLICITATION ISSUED BY THE GENERAL SERVICES ADMINISTRATION.

THE FACTS AND CIRCUMSTANCES ARE SET FORTH RATHER FULLY IN OUR DECISION OF APRIL 2, 1968, AND NEED NOT BE REPEATED HERE.

A NUMBER OF CONTENTIONS HAVE BEEN BROUGHT TO OUR ATTENTION IN THE REQUEST FOR RECONSIDERATION. BASICALLY IT IS URGED THAT THESE CONTENTIONS ESTABLISH THAT IN DESCRIBING THE MATERIAL UNDER ITEM NO. 7, GSA ACTED IN A MANNER WHICH AMOUNTED TO "UNINTENTIONAL BUT GROSSLY NEGLIGENT FRAUD.'

THE DESCRIPTION OF ITEM NO. 7 AS IT APPEARED IN THE SOLICITATION WASSET OUT IN FULL IN OUR DECISION OF APRIL 2, 1968. THIS DESCRIPTION BEGINS AS FOLLOWS:

"REFINED NICKEL PIGS PRODUCED BY FALCONBRIDGE NICKEL MINES LIMITED AND SOCIETE LE NICKEL, S.A. * * *".

WITH RESPECT TO THE DESCRIPTION OF ITEM NO. 7, THE FOLLOWING ARGUMENTS ARE MADE BY COUNSEL FOR PASHELINSKY:

"IN THE INSTANT MATTER, THE GSA SOLICITED BIDS FOR REFINED NICKEL PIGS AND PUBLISHED WHAT THEY CONSIDERED TO BE A REPRESENTATIVE ANALYSIS OF THE METALLIC CONTENT OF THE REFINED NICKEL PIGS. M. PASHELINSKY AND SONS RELYING, OF COURSE, ON THE PUBLISHED ANALYSIS IN THE BID AND RELYING EVEN MORE ON THE TERM -REFINED NICKEL PIG-, AS THAT TERM IS CUSTOMARILY USED IN THE TRADE, PURCHASED AS SOLICITED BY THE GSA. REFINED NICKEL (PIGS), AS DEFINED, IS NICKEL WHICH HAS HAD ITS IMPURITIES REMOVED AND HAS BEEN ELEVATED TO THE MAXIMUM STATE OF METALLIC PURITY (SEE ENGINEERING METALLURGY BY STOUGHTON AND BUTTS, P. 17).'

"* * * SINCE THE METAL M. PASHELINSKY AND SONS RECEIVED HAD COPPER CONTENT, IT COULD NOT BE -LE NICKEL- SINCE LE NICKEL, WHICH IS MINED IN NEW CALEDONIA, OCCURS IN THE FORM OF NICKEL FROM ORE, WHICH IS FREE OF COPPER. REFINED FALCONBRIDGE NICKEL IS IMPRINTED WITH THE FALCON TRADEMARK AT THEIR KRISTENSAND, NORWAY REFINERY. IF THE NICKEL M. PASHELINSKY AND SONS RECEIVED WAS FALCONBRIDGE, IT IS LIKELY THAT IT WAS FROM THE CANADIAN SMELTING FACILITIES OF FALCONBRIDGE. THIS WOULD EXPLAIN WHY THE DELIVERED NICKEL WAS POROUS, GASEOUS, OXIDIZED AND HIGH IN SLAG CONTENT - I.E. IT WAS SMELTED, UNREFINED NICKEL.'

COUNSEL FOR PASHELINSKY CONTENDS THAT GSA DOES NOT DISPUTE THAT THE INDEPENDENT ASSAY FOUND THAT THE MATERIAL SHIPPED TO PASHELINSKY CONTAINED "SLAG ADHERENCE, OXIDIZATION AND COPPER CONTENT FAR IN EXCESS OF THAT WHICH THE SAMPLE ASSAY OF GSA REPRESENTED, AND MORE IMPORTANT, FAR IN EXCESS OF THE COMMON TRADE UNDERSTANDING OF -REFINED .' IT IS URGED THAT "GSA DOES NOT DISPUTE THE FACT THAT IT FAILED TO DELIVER REFINED NICKEL PIGS * * *.'

IT IS ALSO URGED THAT PASHELINSKY IS ENTITLED TO RELIEF PURSUANT TO EQUITABLE CONSIDERATIONS.

THE CONTENTIONS IN THE REQUEST FOR RECONSIDERATION ON THE ISSUE WHETHER GSA ACTED IN GOOD FAITH IN DESCRIBING THE MATERIAL UNDER ITEM NO. 7 HAVE BEEN ANSWERED BY GSA AS FOLLOWS: "THE NAME USED TO DESCRIBE THE MATERIAL OFFERED FOR SALE UNDER ITEM 7, AND THE INFORMATION CONTAINED IN THE SOLICITATION WITH REGARD TO THE ANALYSES AND ORIGIN OF THE MATERIAL WERE OBTAINED FROM GSA RECORDS. "THE REFINED NICKEL PIGS WERE ACQUIRED BY THE PROCUREMENT DIVISION, TREASURY DEPARTMENT (THE FUNCTIONS OF THE PROCUREMENT DIVISION WERE SUBSEQUENTLY TRANSFERRED TO GSA) BY TRANSFER FROM THE RECONSTRUCTION FINANCE CORPORATION. "ENCLOSED IS A COPY OF A LETTER DATED OCTOBER 17, 1946, FROM THE RFC TO INTERNATIONAL NICKEL COMPANY, INC., AUTHORIZING THE RELEASE AND SHIPMENT OF THE REFINED NICKEL PIGS FROM HUNTINGTON, WEST VIRGINIA, TO THE PROCUREMENT DIVISION, TREASURY DEPARTMENT, C/O ARMY SERVICE FORCES DEPOT, COLUMBUS, OHIO. YOU WILL NOTE THE MATERIAL INVOLVED IN THE TRANSFER IS DESCRIBED IN THE LETTER AS REFINED NICKEL PIGS. "THIS LETTER IS THE ONLY DOCUMENT IN GSA FILES RELATING TO THE TRANSFER OF THIS MATERIAL FROM RFC. WE HAVE NO INFORMATION IN OUR FILES RELATING TO THE ACQUISITION OF THE REFINED NICKEL PIGS BY RFC. "THE MATERIAL REFERRED TO IN THE TRANSFER DOCUMENT AS NICARO REFINED NICKEL PIGS WAS SOLD BY GSA IN SEPTEMBER 1962. IN ADDITION TO THE SALES UNDER SOLICITATION NO. DMS-MET-126, A PORTION OF THE FALCONBRIDGE AND NEW CALEDONIAN REFINED NICKEL PIGS WERE SOLD IN APRIL 1966 AND MARCH 1967. "THE NEW CALEDONIAN REFINED NICKEL PIGS WERE REFERRED TO IN THE SOLICITATION AS MATERIAL PRODUCED BY THE SOCIETE LE NICKEL, S.A., SINCE THAT FIRM WAS THE ONLY FIRM PRODUCING NICKEL IN NEW CALEDONIA DURING THE YEARS WHEN RFC WAS PURCHASING METALS. "ALSO ENCLOSED IS A COPY OF THE GSA RECORDS FROM WHICH THE ANALYSES INCLUDED IN THE SOLICITATION WERE TAKEN. "SINCE THE INFORMATION USED TO DESCRIBE ITEM 7 WAS OBTAINED FROM GSA RECORDS, IT IS CLEAR THAT THERE HAS BEEN NO MISREPRESENTATION, GROSS NEGLIGENCE, OR FRAUD ON THE PART OF GSA AS ALLEGED BY COUNSEL FOR MR. PASHELINSKY. "THERE IS NO EVIDENCE THAT THE MATERIAL OFFERED UNDER ITEM 7 WAS WILLFULLY MISDESCRIBED OR THAT THE CONTRACTING OFFICER ACTED IN OTHER THAN GOOD FAITH. "WE HAVE NO INFORMATION TO SUBSTANTIATE COUNSEL'S STATEMENTS REGARDING A CUSTOMARY TRADE UNDERSTANDING OF THE TERM -REFINED NICKEL PIG.- TO THE BEST OF OUR KNOWLEDGE, THE TERM IS NOT IN COMMON USAGE IN THE NICKEL INDUSTRY. "AS INDICATED FROM THE ENCLOSED PUBLICATION OF THE NATIONAL BUREAU OF STANDARDS ON -NICKEL AND ITS ALLOYS' AT PAGE 9 (TABLE 4), REFINED NICKEL PIGS IS NOT ONE OF THE PRIMARY FORMS OF NICKEL AVAILABLE ON THE COMMERCIAL MARKET.'

WITH RESPECT TO THE STATEMENTS IN THE REQUEST FOR RECONSIDERATION THAT GSA DOES NOT DISPUTE THE INDEPENDENT ASSAY AND THAT "REFINED NICKEL PIGS" WERE NOT SHIPPED, GSA TAKES THE POSITION THAT THESE STATEMENTS ARE INCORRECT.

GSA REFERS TO THE LETTER OF MARCH 30, 1967, FROM THE CONTRACTING OFFICER TO PASHELINSKY, WHICH STATES THAT THE ANALYSES TAKEN BY PASHELINSKY WERE NOT CONSIDERED REPRESENTATIVE OF THE TOTAL SHIPPED UNDER THE CONTRACT SINCE AT THE TIME OF THE SAMPLE, 177,000 POUNDS OF THE 200,000 POUNDS SHIPPED HAD BEEN CONSUMED.

THE CONTRACTING OFFICER'S LETTER OF MARCH 30, 1967, STATES THAT EVEN IF THE ANALYSES REPORTS WERE CONSIDERED TO HAVE SOME VALIDITY, THIS DOES NOT ESTABLISH THAT GSA DID NOT SHIP "REFINED NICKEL PIGS" AND IN THIS CONNECTION THAT LETTER EXPOUNDS THAT WHILE THE ANALYSES REPORTS INDICATE A SOMEWHAT LOWER NICKEL PLUS COBOLT CONTENT, THE MATERIAL PURCHASED BY PASHELINSKY UNDER THE CIRCUMSTANCES OF THIS SALE, COULD QUITE PROPERLY BE DESCRIBED AS "REFINED NICKEL PIGS.'

GSA IN ITS MOST RECENT REPORT TO OUR OFFICE HAS ADOPTED THE POSITION OF THE CONTRACTING OFFICER WITH RESPECT TO THESE TWO ISSUES.

WE HAVE REVIEWED GSA'S RECORDS, REFERRED TO ABOVE, WHICH CONSTITUTED THE BASES FOR THE TWO ANALYSES INCLUDED IN THE SOLICITATION UNDER ITEM NO. 7, AND WE FIND THAT GSA'S CONTENTION IN THIS REGARD HAS BEEN SUBSTANTIATED. WE FIND THAT THE LETTER OF OCTOBER 17, 1946, REFERS TO BOTH THE FALCONBRIDGE MATERIAL AND THE NEW CALEDONIAN MATERIAL AS "REFINED NICKEL PIGS.'

WE HAVE CAREFULLY REVIEWED THE BRIEF SUBMITTED WITH THE LETTER OF JUNE 25, 1968, AND WE DO NOT THINK IT HAS BEEN ESTABLISHED THAT GSA FELL BELOW THE REQUISITE STANDARD OF CONDUCT AS SET FORTH IN OUR PRIOR DECISION. THIS CONNECTION THE BACKGROUND INFORMATION WHICH GSA HAS BROUGHT TO OUR ATTENTION SEEMS TO REASONABLY SUPPORT GSA'S POSITION THAT IT ACTED IN GOOD FAITH IN DESCRIBING ITEM NO. 7 IN THE INSTANT SOLICITATION.

WITH RESPECT TO GRANTING RELIEF TO PASHELINSKY ON THE BASIS OF EQUITABLE CONSIDERATIONS, SEE THE DECISION AT 42 COMP. GEN. 124, 142, WHICH INDICATES THAT YOUR CLIENT'S CLAIM CANNOT BE SUSTAINED ON THIS BASIS.

FOR THESE REASONS OUR DECISION OF APRIL 2, 1968, DENYING PASHELINSKY'S CLAIM, IS AFFIRMED.