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B-124462, OCT. 21, 1955

B-124462 Oct 21, 1955
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LITVIN AND SON: REFERENCE IS MADE TO LETTERS OF JULY 27 AND AUGUST 24. 148.31 TWO HEARINGS WERE ACCORDED YOU AND YOUR ATTORNEY BY THE ORDNANCE CONTRACT ADJUSTMENT BOARD. ACCOMPLISH THAT PURPOSE SEVERAL MEETINGS WERE HELD BY YOU AND THE GOVERNMENT REPRESENTATIVES DURING WHICH TIME THE WORK SITE WAS INSPECTED. THAT YOU AND YOUR REPRESENTATIVES WERE ACCORDED THE OPPORTUNITY OF A COMPLETE PRESENTATION OF YOUR ALLEGATIONS. IT WAS DETERMINED BY THE ARSENAL PERSONNEL RESPONSIBLE FOR THE ADMINISTRATION OF THE CONTRACT. YOUR CONTENTION IS IN DIRECT CONFLICT WITH THAT CONCLUSION. THIS OFFICE WAS NOT A PARTY TO THE CONSUMMATION OF THE INSTANT AGREEMENT AND THEREFORE MUST RELY UPON THE FACTS REPORTED BY THE ADMINISTRATIVE OFFICERS AND UPON THE INFORMATION FURNISHED BY YOU.

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B-124462, OCT. 21, 1955

TO K. LITVIN AND SON:

REFERENCE IS MADE TO LETTERS OF JULY 27 AND AUGUST 24, 1955, FROM YOUR ATTORNEY, REQUESTING FURTHER CONSIDERATION OF YOUR CLAIM FOR AN ADDITIONAL AMOUNT ALLEGED TO BE DUE UNDER CONTRACT NO. DA-36-038-ORD 11684, DATED AUGUST 18, 1952.

AN EXAMINATION OF THE RECORD DISCLOSES THAT UNDER DATE OF JANUARY 12, 1954, YOU PRESENTED TO THE CONTRACTING OFFICER A CLAIM FOR LABOR AND MATERIALS FURNISHED, ALLEGEDLY IN EXCESS OF THE CONTRACT REQUIREMENTS, IN THE SUM OF $49,148.31. FOLLOWING AN ADVERSE FINDING BY THE ADMINISTRATIVE OFFICE AS TO CERTAIN ITEMS OF YOUR CLAIM, YOU SUBMITTED A CLAIM TO THE GENERAL ACCOUNTING OFFICE FOR $81,050.91. ON PAGE 7 OF LETTER DATED AUGUST 24, 1955, YOUR ATTORNEY NOW SUGGESTS A COMPROMISE SETTLEMENT IN AN UNSTATED AMOUNT BASED UPON THE ACTUAL COSTS OF THE ITEMS INVOLVED, PLUS OVERHEAD.

YOUR INITIAL CLAIM, FILED UNDER THE PROVISIONS OF TITLE II OF THE FIRST WAR POWERS ACT, COVERED THE FOLLOWING ITEMS AND RESPECTIVE AMOUNTS.

TABLE.

SUPPLYING AND INSTALLING METER PANEL $2,831.76

FURNISHING AND INSTALLING TWO LARGE

HEATING AND VENTILATING UNITS IN SPRAY ROOM 19,878.97

FURNISHING AND INSTALLING THREE LARGE HEATING

UNITS AS PART OF VENTILATING SYSTEM 21,273.52

SUPPLYING AND INSTALLING SAFETY FEATURES TO

ELECTRICAL POWER INSTALLMENT IN

PAINT-SPRAY ROOM 5,164.06

TOTAL $49,148.31

TWO HEARINGS WERE ACCORDED YOU AND YOUR ATTORNEY BY THE ORDNANCE CONTRACT ADJUSTMENT BOARD. PRIOR TO THESE HEARINGS THE COMMANDING OFFICER APPOINTED A COMMITTEE OF FIVE OFFICIALS OF THE FRANKFORD ARSENAL TO MEET WITH YOU AND YOUR COUNSEL FOR THE PURPOSE OF DEVELOPING ALL OF THE FACTS HAVING ANY BEARING ON THE CONTENTIONS GIVING RISE TO YOUR CLAIM. ACCOMPLISH THAT PURPOSE SEVERAL MEETINGS WERE HELD BY YOU AND THE GOVERNMENT REPRESENTATIVES DURING WHICH TIME THE WORK SITE WAS INSPECTED. THE RECORD INDICATES THAT EVERY CONTENTION OF A MATERIAL FACT WHICH HAD BEEN MADE ON YOUR BEHALF HAD CONSIDERATION IN THE PROCEEDINGS, AND THAT YOU AND YOUR REPRESENTATIVES WERE ACCORDED THE OPPORTUNITY OF A COMPLETE PRESENTATION OF YOUR ALLEGATIONS. UPON A THOROUGH CONSIDERATION OF ALL THE FACTS, THE BOARD AWARDED YOU A TOTAL OF $27,882.96, REPRESENTING MATERIALS FURNISHED AND SERVICES RENDERED IN EXCESS OF THE CONTRACT REQUIREMENTS. IT WAS DETERMINED BY THE ARSENAL PERSONNEL RESPONSIBLE FOR THE ADMINISTRATION OF THE CONTRACT, AS PREVIOUSLY AGREED UPON BY THE PARTIES DURING THE NEGOTIATIONS CONDUCTED PRIOR TO THE EXECUTION OF THE CONTRACT. YOUR CONTENTION IS IN DIRECT CONFLICT WITH THAT CONCLUSION.

OF COURSE, THIS OFFICE WAS NOT A PARTY TO THE CONSUMMATION OF THE INSTANT AGREEMENT AND THEREFORE MUST RELY UPON THE FACTS REPORTED BY THE ADMINISTRATIVE OFFICERS AND UPON THE INFORMATION FURNISHED BY YOU. WHERE, AS HERE, THERE IS INVOLVED DISPUTED QUESTIONS OF FACT, IT HAS BEEN THE UNIFORM RULE OF THE ACCOUNTING OFFICERS OF THE GOVERNMENT TO ACCEPT THE ADMINISTRATIVE REPORT IN THE ABSENCE OF SUFFICIENT EVIDENCE TO OVERCOME THE CORRECTNESS OF SUCH REPORT. WHERE THERE EXISTS AN ELEMENT OF DOUBT AS TO THE CORRECTNESS OF A CLAIM, THE REFUSAL OF THE ACCOUNTING OFFICERS TO CERTIFY SUCH CLAIM FOR PAYMENT IS SUPPORTED BY THE COURTS. LONGWILL V. UNITED STATES, 17 C.CLS. 288; CHARLES V. UNITED STATES, 19 C.CLS. 316. IT WAS THE DOUBT CREATED BY THE ADVERSE STATEMENTS IN THE RECORD, AMONG OTHER REASONS, RATHER THAN ANY DECISION BY A GOVERNMENT OFFICER AS SUGGESTED IN YOUR ATTORNEY'S LETTER OF JULY 27, 1955, WHICH FORMED THE BASIS FOR THE STATEMENT IN OUR DECISION OF AUGUST 2, 1955, THAT THE RECORD AFFORDS NO LEGAL BASIS FOR THE ALLOWANCE OF YOUR ENTIRE CLAIM.

WITH RESPECT TO THE MATTER OF DISPUTES ARISING UNDER THE CONTRACT, PARAGRAPH 6 OF THE CONTRACT PROVIDED THAT ANY DISPUTE CONCERNING A QUESTION OF FACT SHOULD BE DECIDED BY THE CONTRACTING OFFICER, SUBJECT TO APPEAL BY THE CONTRACTOR TO THE HEAD OF THE AGENCY CONCERNED OR HIS DULY AUTHORIZED REPRESENTATIVE, WHOSE DECISION WAS TO BE FINAL AND CONCLUSIVE. THAT PROVISION, GENERALLY MADE A PART OF THE STANDARD FORM GOVERNMENT CONSTRUCTION CONTRACT, HAS BEEN CONSIDERED MANY TIMES BY THE COURTS. TO THE FINALITY REQUIRED TO BE ACCORDED ADMINISTRATIVE FINDINGS OF FACT MADE PURSUANT THERETO, SEE UNITED STATES V. MOORMAN, 338 U.S. 457, AND THE CASES CITED THEREIN. ALSO, SEE UNITED STATES V. WUNDERLICH, 342 U.S. 98.

NOTWITHSTANDING THE FOREGOING CONSIDERATION GIVEN YOUR CLAIM, YOUR ATTORNEY NOW REQUESTS THAT THE CLAIM BE CONSIDERED ONA QUANTUM MERUIT BASIS, AND THAT PAYMENT BE MADE FOR THE ACTUAL AMOUNT EXPENDED BY YOU IN THE PERFORMANCE OF THE CONTRACT, PLUS OVERHEAD EXPENSES. BECAUSE OF THE ALLEGED AMBIGUITIES IN THE CONTRACT TERMS, YOUR COUNSEL CONTENDS THAT THE AGREEMENT SHOULD BE TREATED AS BEING VOID AB INITIO. THAT CONTENTION IS NOT TENABLE. IT HAS BEEN HELD REPEATEDLY THAT WHERE AN EXPRESS CONTRACT HAS BEEN PERFORMED, NO RECOVERY MAY BE HAD ON A QUANTUM MERUIT BASIS. HERE THE EXECUTED CONTRACT WAS CONSIDERED BY THE PARTIES DURING PERFORMANCE AND UPON COMPLETION OF THE WORK AS BEING VALID AND BINDING. IF, AT ANY TIME DURING THE NEGOTIATIONS OF THE BASIC CONTRACT, YOU HAD REASON TO BELIEVE THAT A MISTAKE HAD BEEN MADE EITHER BY THE CONTRACTING OFFICER OR BY YOU SO THAT THE CONTRACT DID NOT IN FACT EXPRESS YOUR AGREEMENT IN THE MATTER, YOU HAD A RIGHT TO RESCIND SUCH INSTRUMENT. BUT, THERE IS NO LEGAL BASIS FOR A PARTY TO CONTRACT, PERFORM, COLLECT THE FULL CONTRACT PRICE, AND THEN REPUDIATE THE CONTRACT AND RECOVER AS IF THERE HAD BEEN NONE. BOARD OF TRUSTEES, ETC. V. O. D. WILSON, CO., 133 F.2D 399. UNDER THE CIRCUMSTANCES IT MUST BE APPARENT THAT THERE IS NO LEGAL BASIS UPON WHICH THE INSTANT CONTRACT MAY BE REVOKED, AND THEREFORE THIS OFFICE IS WITHOUT AUTHORITY TO CONSIDER YOUR CLAIM ON A QUANTUM MERUIT BASIS, IN COMPLETE DISREGARD OF THE SAID AGREEMENT. IT IS REGRETTED THAT A LOSS HAS BEEN SUSTAINED IN THE PERFORMANCE OF THE CONTRACT; HOWEVER, SUCH FACT CREATES NO LEGAL BASIS FOR THE PAYMENT OF ANY AMOUNT IN EXCESS OF THE CONTRACT PRICE, AS AMENDED, PLUS THE SUMS AWARDED FOR VALUE OF THE EXTRA WORK PERFORMED.

ACCORDINGLY, OUR DECISION OF AUGUST 2, 1955, MUST BE AFFIRMED AND SETTLEMENT FOR THE AMOUNT ADMINISTRATIVELY FOUND DUE WILL BE ISSUED IN DUE COURSE, WITH APPROPRIATE SET-OFF TO LIQUIDATE ..END :

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