B-154199, AUG. 25, 1964

B-154199, AUG. 25, 1964

TO AMERICAN NICKEL ALLOY MANUFACTURING CORPORATION:

REFERENCE IS MADE TO YOUR LETTER OF AUGUST 10, 1964, REQUESTING RECONSIDERATION OF OUR DECISION OF JUNE 8, 1964, REAFFIRMED BY OUR DECISION OF JULY 31, 1964, WHICH DISALLOWED YOUR CLAIM FOR ADJUSTMENT OF THE PRICE PAID BY YOU FOR SCRAP INCONEL PURCHASED UNDER SALES INVITATION NO. 11-S-64-22, ISSUED BY THE DEFENSE SURPLUS SALES OFFICE, PHILADELPHIA NAVAL BASE, PHILADELPHIA, PENNSYLVANIA.

OUR DECISION, WHICH INVOKED THE EXPRESS DISCLAIMER OF WARRANTY PROVISIONS IN YOUR SALES CONTRACT IN DENYING YOUR CLAIM, WAS BASED ON NUMEROUS COURT DECISIONS WHICH HAVE CONSISTENTLY DENIED RELIEF IN SIMILAR CIRCUMSTANCES TO PURCHASERS OF SURPLUS GOVERNMENT PROPERTY. YOU NOW URGE PAYMENT OF YOUR CLAIM ON THE BASIS OF A DECISION BY THE ARMED SERVICES BOARD OF CONTRACT APPEALS IN THE STATE METALS AND STEEL CO. CASE, A.S.B.C.A. NO. 3494 (1957), IN WHICH A PURCHASER OF INCONEL UNDER A CONTRACT CONTAINING A QUANTITY VARIATION CLAUSE WAS ALLOWED A PRICE ADJUSTMENT BECAUSE THE MATERIAL DELIVERED NOT ONLY CONTAINED STAINLESS STEEL BUT EXCEEDED THE QUANTITY WHICH THE PURCHASER WAS REQUIRED TO ACCEPT UNDER HIS CONTRACT.

WHILE AN ASBCA DECISION ON A DISPUTED QUESTION OF FACT IN A PARTICULAR CASE WOULD BE BINDING ON OUR OFFICE AS TO THE FACTS FOUND, WHERE THE CONTRACT CONTAINS A DISPUTES CLAUSE, SUCH AS PARAGRAPH 15 OF THE GENERAL SALES TERMS AND CONDITIONS OF YOUR CONTRACT, MAKING SUCH DECISION FINAL AND CONCLUSIVE, SUCH A DECISION IS NOT BINDING ON OUR OFFICE AS TO OTHER CASES PROPERLY BEFORE US FOR DECISION. ACCORDINGLY, THE STATE METALS DECISION IS NOT DETERMINATIVE OF OUR ACTION ON YOUR CLAIM.

IN ADDITION, THE ACT OF MAY 11, 1954, 68 STAT. 81, POPULARLY CALLED THE WUNDERLICH ACT, 41 U.S.C. 321-322, PROHIBITS A PROVISION IN A GOVERNMENT CONTRACT WHICH WOULD MAKE FINAL ON A QUESTION OF LAW THE DECISION OF ANY ADMINISTRATIVE OFFICIAL, REPRESENTATIVE OR BOARD. SINCE THE DETERMINATION OF THE APPLICABILITY OF THE DISCLAIMER OF WARRANTY PROVISIONS OF YOUR SALES CONTRACT INVOLVES A QUESTION OF LAW, WE ARE NOT BOUND, IN THE EXERCISE OF OUR CLAIMS SETTLEMENT AUTHORITY, BY ANY LEGAL CONCLUSIONS OF THE ADMINISTRATIVE OFFICE IN THIS OR SIMILAR CASES. WHILE SUCH VIEWS ARE GIVEN DUE CONSIDERATION, OUR OFFICE MAKES AN INDEPENDENT DETERMINATION OF THE LEGAL RIGHTS OF CLAIMANTS IN EACH CASE IN ACCORDANCE WITH OUR OWN INTERPRETATION OF PERTINENT CONTRACTUAL AND STATUTORY PROVISIONS AND OTHER LEGAL PRINCIPLES ESTABLISHED BY JUDICIAL PRECEDENTS. SEE ILLINOIS SURETY CO. V. PEELER, 240 U.S. 214, 219-220.

WE MUST ALSO REJECT YOUR CONTENTION THAT YOUR CLAIM IS SUPPORTED BY DADOURIAN EXPORT CORP. V. UNITED STATES, 291 F.2D 178, CITED IN OUR PREVIOUS DECISION. WE DO NOT READ THE EXCERPT QUOTED BY YOU AS INDICATING ENDORSEMENT BY THE COURT OF APPEALS OF THE STATE METAL AND STEEL DECISION, WHICH IT UNDERTOOK TO DISTINGUISH, AND WE BELIEVE THAT THE ACTUAL DECISION IN DADOURIAN, WHICH DENIED ANY RELIEF TO THE PURCHASER OF MATERIAL DESCRIBED AS NETS MADE OF MANILA ROPE, BUT SOME OF WHICH WERE NOT MANILA ROPE, SUPPORTS OUR DECISION.

IN VIEW OF THE FOREGOING, WE MUST ADHERE TO OUR CONCLUSION THAT THERE IS NO LEGAL BASIS FOR PAYMENT OF YOUR CLAIM. ACCORDINGLY, OUR DECISIONS OF JUNE 8 AND JULY 31, 1964, ARE AFFIRMED.