B-154199, NOV. 3, 1964

B-154199, NOV. 3, 1964

TO AMERICAN NICKEL ALLOY MANUFACTURING CORPORATION:

YOUR LETTER OF OCTOBER 8, 1964, REQUESTS THAT WE AGAIN RECONSIDER OUR DECISION OF JUNE 8, 1964, WHICH DISALLOWED YOUR CLAIM FOR ADJUSTMENT OF THE PURCHASE PRICE OF A LOT OF SCRAP INCONEL LOCATED AT THE NAVAL AIR STATION, LAKEHURST, NEW JERSEY, AND SOLD TO YOU UNDER SALES INVITATION NO. 11-S-64-22, ISSUED BY THE DEFENSE SURPLUS SALES OFFICE, PHILADELPHIA NAVAL BASE, PHILADELPHIA, PENNSYLVANIA. THE DECISION WAS RECONSIDERED ON TWO PREVIOUS OCCASIONS AT YOUR REQUEST AND WAS REAFFIRMED BY OUR DECISIONS OF JULY 31 AND AUGUST 25, 1964.

BRIEFLY, YOU PAID $753.92 ON A LOT OF MATERIAL DESCRIBED AS APPROXIMATELY 1,500 POUNDS OF SCRAP INCONEL ON WHICH YOU HAD BID $0.50261 PER POUND. YOUR SALES CONTRACT, WHICH CONTAINED AN EXPRESS DISCLAIMER OF WARRANTY AS TO CONDITION, QUALITY, DESCRIPTION, ETC., REQUIRED YOU TO ACCEPT AT YOUR BID PRICE A QUANTITY VARIATION OF 10 PERCENT (150 POUNDS), OR A MAXIMUM OF 1,650 POUNDS.

SINCE THE SHIPMENT DELIVERED TO YOU WEIGHED 2,434 POUNDS, THE GOVERNMENT BILLED YOU FOR THE 934-POUND OVERAGE AT YOUR BID PRICE. YOU DECLINED TO PAY THE ADDITIONAL AMOUNT AND COUNTERCLAIMED FOR AN ADJUSTMENT ON 243 POUNDS OF THE BASIC QUANTITY OF 1,500 POUNDS ON THE BASIS THAT ONLY 1,257 POUNDS OF THE MATERIAL WAS INCONEL, THE REMAINING 1,177 POUNDS BEING STAINLESS STEEL OR MISCELLANEOUS SCRAP, VALUED AT $0.05 PER POUND. YOUR CLAIM WAS DENIED UNDER THE DISCLAIMER OF WARRANTY PROVISIONS OF THE SALES CONTRACT. ALSO, YOUR REQUEST TO RETURN THE EXCESS QUANTITY WAS REJECTED SINCE IT APPEARED THAT YOU HAD DISPOSED OF THE INCONEL AND WERE UNABLE TO RETURN TO THE GOVERNMENT THE EXCESS QUANTITY OF 784 POUNDS (2,434 POUNDS LESS 1,650 POUNDS) IN THE SAME FORM AS DELIVERED TO YOU--- THAT IS, IN THE SAME RELATIVE PROPORTIONS OF THE DIFFERENT METALS AS IN THE TOTAL LOT.

YOU NOW CONTEND THAT THE GOVERNMENT ERRONEOUSLY ADDED APPROXIMATELY 784 POUNDS OF MATERIAL TO THE 1,500 POUNDS OFFERED FOR SALE. THE RECORD BEFORE OUR OFFICE CONTAINS A STATEMENT FROM THE DISPOSAL ACTIVITY THAT NO MATERIAL WAS ADDED TO THE PROPERTY ORIGINALLY LISTED FOR SALE. FROM THIS, IT WOULD APPEAR THAT THE MATERIAL WHICH WAS DELIVERED TO YOU WAS THE MATERIAL ON WHICH YOUR BID WAS SUBMITTED AND ACCEPTED.

HOWEVER, UPON RECONSIDERATION OF THE VARIOUS CIRCUMSTANCES AS SHOWN BY THE RECORD, AND HAVING IN MIND THAT THE QUANTITY VARIATION CLAUSE IN YOUR SALES CONTRACT REQUIRED YOU TO ACCEPT ONLY 1,650 POUNDS OF THE MATERIAL AT YOUR BID PRICE, WE HAVE CONCLUDED THAT IT WOULD BE APPROPRIATE TO ACCEPT YOUR VALUATION OF $0.05 PER POUND FOR THE 784 POUNDS OF EXCESS MATERIAL YOU RECEIVED, AND TO ADJUST THE AMOUNT OF THE GOVERNMENT'S CLAIM AGAINST YOU TO $114.57, REPRESENTING 150 POUNDS AT $0.50261 AND 784 POUNDS AT $0.05. IN LIEU THEREOF, RETURN OF THE EXCESS 784 POUNDS OF MATERIAL TO THE GOVERNMENT AT YOUR EXPENSE MAY BE ACCEPTED UPON PAYMENT BY YOU OF THE BALANCE OF $75.37 FOR 150 POUNDS AT THE CONTRACT PRICE OF $0.50261.

PLEASE ADVISE OUR OFFICE WHETHER YOU ARE IN ACCORD WITH THIS PROPOSAL SO THAT PROPER ARRANGEMENTS MAY BE MADE WITH THE DEFENSE LOGISTICS SERVICES CENTER FOR SETTLEMENT OF THE INDEBTEDNESS AND RETURN OF THE EXCESS PROPERTY IF IT IS TO BE RETURNED.