B-121198, MAR. 1, 1956

B-121198: Mar 1, 1956

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LTD.: REFERENCE IS MADE TO A LETTER DATED FEBRUARY 1. - DURING WHICH TIME IT WAS ADMITTED THAT THE ROOMS WERE FULLY OCCUPIED. IT IS UNDERSTOOD THAT THE LOSS CLAIMED WAS FIXED IN THE AMOUNT OF THE DIFFERENCE BETWEEN SUCH REVENUES ACTUALLY REALIZED DURING THE PERIOD INVOLVED AND THE NORMALLY ANTICIPATED REVENUES FOR THE NUMBER OF GUEST RESERVATIONS CANCELLED IN ORDER TO ACCOMMODATE THE EXPECTED NEEDS OF THE CONFERENCE. THE LOSS WAS THEN ALLOCATED AMONG THE PARTICIPATING POWERS. WHILE IT IS REPORTED THAT THE OTHER GOVERNMENTS HAVE PAID THEIR SHARES OF THE LOSSES CLAIMED IN ACCORDANCE WITH THAT APPORTIONMENT. WHICH WAS THE SOLE REPRESENTATIVE OF THE UNITED STATES IN CONNECTION WITH THE ARRANGEMENTS FOR THE CONFERENCE.

B-121198, MAR. 1, 1956

TO BERMUDA DEVELOPMENT COMPANY, LTD.:

REFERENCE IS MADE TO A LETTER DATED FEBRUARY 1, 1956, FROM YOUR COUNSEL, REQUESTING FURTHER REVIEW OF THE PREVIOUS ACTION TAKEN BY OUR OFFICE ON YOUR CLAIM FOR COMPENSATION FOR LOSS OF REVENUES RESULTING FROM CANCELLATION OF THE PROPOSED THREE-POWER CONFERENCE SCHEDULES TO BE HELD IN BERMUDA IN JUNE 1953.

PAYMENT HAS BEEN MADE IN FULL OF ALL ROOMS RESERVED BY THE UNITED STATES FOR THE ENTIRE PERIOD OF THE RESERVATIONS, EXCEPT FOR A FEW DAYS--- JULY 5 THROUGH 7--- DURING WHICH TIME IT WAS ADMITTED THAT THE ROOMS WERE FULLY OCCUPIED. THIS DISALLOWED PORTION OF THE CLAIM REPRESENTS A PROPORTIONATE PART OF ANTICIPATED PROFITS ON INCIDENTAL BUSINESS SUCH AS BAR AND INCIDENTAL REVENUES, PLUS A DIFFERENCE BETWEEN THE CLAIM FOR LOSS OF ROOM RESERVATIONS AND THE AMOUNT PAID THEREFOR. IT IS UNDERSTOOD THAT THE LOSS CLAIMED WAS FIXED IN THE AMOUNT OF THE DIFFERENCE BETWEEN SUCH REVENUES ACTUALLY REALIZED DURING THE PERIOD INVOLVED AND THE NORMALLY ANTICIPATED REVENUES FOR THE NUMBER OF GUEST RESERVATIONS CANCELLED IN ORDER TO ACCOMMODATE THE EXPECTED NEEDS OF THE CONFERENCE. THE LOSS WAS THEN ALLOCATED AMONG THE PARTICIPATING POWERS--- THE UNITED STATES, GREAT BRITAIN, AND FRANCE--- AND THE GOVERNMENT OF BERMUDA, IN PROPORTION TO THEIR RESPECTIVE ROOM OCCUPANCIES IN DECEMBER 1953. WHILE IT IS REPORTED THAT THE OTHER GOVERNMENTS HAVE PAID THEIR SHARES OF THE LOSSES CLAIMED IN ACCORDANCE WITH THAT APPORTIONMENT, THE REPORTS OF THE DEPARTMENT OF STATE, WHICH WAS THE SOLE REPRESENTATIVE OF THE UNITED STATES IN CONNECTION WITH THE ARRANGEMENTS FOR THE CONFERENCE, FAIL TO SHOW THAT IT DID AT ANY TIME AGREE TO THE PROPOSAL FOR REIMBURSEMENT OR ACKNOWLEDGE ANY LIABILITY ON THE PART OF THIS GOVERNMENT FOR ANY PART OF THE LOSSES CLAIMED.

IN THESE CIRCUMSTANCES, WE SEE NO BASIS FOR THE CLAIM EXCEPT AS ONE FOR CONSEQUENTIAL DAMAGES FOR BREACH OF CONTRACT. IN THIS ASPECT, WE CANNOT VIEW THE RESERVATION OF ROOMS BY THE UNITED STATES AS CREATING ANY LEGAL DUTY ON ITS PART TO THE HOTEL TO HOLD A CONFERENCE, BUT MERELY TO PAY FOR THE ROOMS RESERVED. THIS DUTY HAS BEEN DISCHARGED BY THE PAYMENT MADE.

ACCORDINGLY, WE FIND NO LEGAL BASIS FOR PAYMENT OF THE CLAIM IN QUESTION, AND WE HAVE NOT BEEN REFERRED TO ANY LEGAL AUTHORITY IN ITS SUPPORT. SINCE WE HAVE NO POWER TO ALLOW CLAIMS EXCEPT UPON STRICTLY LEGAL GROUNDS, PAYMENT OF THE AMOUNT CLAIMED MUST AGAIN BE DENIED.