B-124293, MAR. 21, 1956

B-124293, MAR. 21, 1956

TO THE HONORABLE SECRETARY OF THE INTERIOR:

REFERENCE IS MADE TO LETTER DATED JULY 12, 1955, OF THE BONNEVILLE POWER ADMINISTRATION, TRANSMITTING TO OUR CLAIMS DIVISION FOR PROPER DISPOSITION UNITED STATES TREASURER'S CHECK NO. 15,640,901, DATED JULY 5, 1955, FOR $10,445.40, DRAWN TO THE ORDER OF THE FIRST NATIONAL BANK OF MCMINNVILLE OR THE TREASURER OF THE UNITED STATES, REPRESENTING PAYMENT FOR WORK PERFORMED BY PAUL C. HELMICK COMPANY UNDER THE ADMINISTRATION'S CONTRACT NO. 14-03-001-10444, DATED AUGUST 10, 1953. RELATIVE TO THE CHECK AND A CLAIM OF THE COMPANY AGAINST THE GOVERNMENT FOR $7,945,24, THE LETTER STATED:

"DURING THE COURSE OF THE CONTRACTOR'S WORK UNDER THE ABOVE MENTIONED CONTRACT, A FOREST FIRE STARTED IN THE AREA OF HIS OPERATIONS, AND IT IS THE POSITION OF THE FOREST SERVICE THAT THE PAUL C. HELMICK COMPANY IS INDEBTED TO THE UNITED STATES IN THE AMOUNT OF $10,445.40 FOR SUPPRESSION COSTS INCURRED BY THE FOREST SERVICE IN CONNECTION WITH THAT FIRE. THE CONTRACTOR HAS DENIED RESPONSIBILITY FOR THE FIRE AND HAS REFUSED PAYMENT OF THE FOREST SERVICE'S CLAIM. THAT AGENCY HAS, THEREFORE, REQUESTED THE BONNEVILLE POWER ADMINISTRATION TO WITHHOLD FROM THE AMOUNTS DUE THE CONTRACTOR SUFFICIENT FUNDS TO COVER THE GOVERNMENT'S CLAIM. (SEE COPY OF FOREST SERVICE LETTER OF FEBRUARY 16, 1955, ATTACHED). IT IS IN ACCORDANCE WITH THAT REQUEST AND UNDER THE PROVISIONS OF COMPTROLLER GENERAL LETTER B-97385, DATED MAY 18, 1954, THAT THE ENCLOSED CHECK IS FORWARDED TO YOUR OFFICE FOR FURTHER HANDLING.

"THE CLAIM OF THE FOREST SERVICE IS PREDICATED ON THE OBLIGATIONS IMPOSED BY IT ON THE BONNEVILLE POWER ADMINISTRATION IN A SPECIAL USE PERMIT TO ALLOW CLEARING OPERATIONS ON A TRANSMISSION LINE RIGHT-OF-WAY TRAVERSING NATIONAL FOREST LANDS. THESE OBLIGATIONS WERE, IN TURN, MADE A PART OF THE SPECIFICATIONS FOR THE CLEARING CONTRACT, AND THE PERTINENT PROVISIONS ARE AS FOLLOWS:

"601. GENERAL. A. THESE REQUIREMENTS ARE TAKEN FROM THE SPECIAL USE PERMIT GRANTED THE BONNEVILLE POWER ADMINISTRATION BY THE UNITED STATES FOREST SERVICE. THE CONTRACTOR SHALL CONDUCT HIS OPERATIONS IN STRICT ACCORDANCE WITH THE REQUIREMENTS STATED IN THIS SECTION.'

"603. FIRE. A. THE CONTRACTOR SHALL DO EVERYTHING REASONABLE WITHIN HIS POWER AND SHALL REQUIRE HIS EMPLOYEES TO DO EVERYTHING REASONABLY WITHIN THEIR POWER, BOTH INDEPENDENTLY AND UPON REQUEST OF OFFICERS OF THE FOREST SERVICE, TO PREVENT AND SUPPRESS FIRES ON OR NEAR ANY LANDS TO BE OCCUPIED UNDER THIS PERMIT. THE CONTRACTOR SHALL PAY THE UNITED STATES FOREST SERVICE, OR OTHER DULY AUTHORIZED PROTECTIVE AGENCY, THE SUPPRESSION COSTS AND DAMAGES RESULTING FROM ANY FIRES CAUSED BY HIS OPERATIONS.

"B. AT ALL TIMES WHEN BURNING IS IN PROGRESS THE CONTRACTOR SHALL HAVE ON THE PROJECT A SUFFICIENT NUMBER OF MEN TO KEEP THE FIRES UNDER CONTROL. THE SIZE OF THE CREWS AND THEIR PERSONNEL SHALL BE SUBJECT TO THE APPROVAL OF THE CONTRACTING OFFICER.'

"THE LAST SENTENCE IN PARAGRAPH 603A IMPOSES A LIABILITY ON THE CONTRACTOR FOR SUPPRESSION COSTS AND DAMAGES BY FIRES CAUSED BY HIS OPERATIONS, AND IT APPEARS THAT THE ELEMENT OF NEGLIGENCE IS NOT NECESSARY IN DETERMINING LIABILITY.

"THE CONTRACTOR, ON THE OTHER HAND, HAS SUBMITTED A CLAIM IN THE AMOUNT OF $7,945.24 FOR COSTS INCURRED IN SUPPRESSING THE FIRE AND CONTENDS THAT THE BONNEVILLE POWER ADMINISTRATION IS LIABLE FOR PAYMENT OF THIS AMOUNT AS AN EXTRA WORK ITEM UNDER THE CONTRACT. THE OFFICE OF THE REGIONAL SOLICITOR FOR THE DEPARTMENT OF THE INTERIOR HAS ADOPTED THE POSITION THAT THERE IS NO LANGUAGE IN THE CONTRACT AUTHORIZING EXPENDITURE OF ITS APPROPRIATIONS FOR THIS PURPOSE AND THAT THE BONNEVILLE POWER ADMINISTRATION MERELY ACTED AS A MEDIUM FOR TRANSMITTING FIRE FIGHTING ORDERS FROM THE FOREST SERVICE. THIS CLAIM HAS BEEN ASSERTED, WITH OTHERS, WHICH CONSTITUTE AN APPEAL FROM A FINDINGS OF FACT BY THE CONTRACTING OFFICER. THE APPEAL IS NOW BEFORE THE DEPARTMENT OF THE INTERIOR BOARD OF CONTRACT APPEALS. SINCE THE CONTRACTOR'S CLAIM FOR REIMBURSEMENT ARISES FROM THE SAME FIRE WHICH CONSTITUTED THE BASIS OF THE FOREST SERVICE'S CLAIM, IT APPEARS THAT BOTH MATTERS SHOULD BE RESOLVED IN THE DECISION REACHED BY YOUR OFFICE.'

IN ACCORDANCE WITH OUR REQUEST, THE ADMINISTRATION, BY LETTER OF SEPTEMBER 23, 1955, FURNISHED US WITH A COPY OF THE FINDINGS OF FACT OF THE CONTRACTING OFFICER, DATED APRIL 15, 1955, REFERRED TO IN THE ABOVE- QUOTED LETTER, TOGETHER WITH OTHER PAPERS RELATING TO THE CONTRACTOR'S APPEAL, AND ADVISED THAT A HEARING BEFORE THE BOARD OF CONTRACT APPEALS OF THE INTERIOR DEPARTMENT IN CONNECTION WITH THE APPEAL, TO BE HELD IN SEATTLE, WASHINGTON, HAD BEEN SCHEDULED FOR OCTOBER 3, 1955. ACCORDING TO A LETTER DATED FEBRUARY 13, 1956, FROM LYCETTE, DIAMOND AND SYLVESTER, ATTORNEYS FOR THE CONTRACTOR, THE HEARINGS BEFORE THE BOARD WERE CONCLUDED LAST OCTOBER, BUT DUE TO THE FACT THAT THE GOVERNMENT HAD REQUESTED DELAY IN ORDER TO SUBMIT A POST HEARING BRIEF, WHICH THE ATTORNEYS HAD JUST RECEIVED, A DECISION HAD NOT YET BEEN RENDERED. THE ATTORNEYS COMPLAIN IN THE LETTER THAT, AT THE HEARING, THE GOVERNMENT TOOK THE POSITION THAT THE MATTER OF THE AMOUNT WITHHELD TO COVER THE FOREST SERVICE CLAIM WAS NOT BEFORE THE BOARD AND DECLINED TO INTRODUCE ANY EVIDENCE BEARING THEREON. AS EVIDENCE OF THE POSITION TAKEN BY THE BOARD, THE ATTORNEYS QUOTE THAT PART OF THE POST-HEARING BRIEF OF GOVERNMENT IN THE APPEAL OF PAUL C. HELMICK COMPANY, ETC., DATED JANUARY 25, 1956, WHICH READS AS FOLLOWS:

"WE FEEL THAT OUR CONTINUING OBJECTION TO THE ADMISSION OF ANY TESTIMONY CONCERNING THE NASON RIDGE FIRE ON THE GROUND THAT THIS ISSUE WAS NOT PROPERLY BEFORE THE BOARD WAS WELL TAKEN. UPON BEING NOTIFIED BY THE FOREST SERVICE THAT IT HAD A CLAIM AGAINST THE APPELLANT FOR FIRE SUPPRESSION COSTS AND DAMAGE TO NATIONAL FOREST LAND IN THE AMOUNT OF $10,445, THE BONNEVILLE POWER ADMINISTRATION TRANSMITTED THIS SUM TO THE COMPTROLLER GENERAL FOR SETTLEMENT PURSUANT TO POLICY ANNOUNCED IN B- 97385, DATED MAY 18, 1954.

"ALL FUNDS WITHHELD BY THE GOVERNMENT IN CONNECTION WITH THIS CONTRACT HAVE BEEN RELEASED TO THE APPELLANT EXCEPT THE MONEY TRANSMITTED TO THE COMPTROLLER GENERAL TO SATISFY THE FOREST SERVICE CLAIM.'

THE ATTORNEYS CONTEND THAT THE CONTRACTOR IS ENTITLED TO "SOME FORUM" FOR THE DETERMINATION OF THE ISSUE WITH REFERENCE TO THE AMOUNT WITHHELD.

IT IS APPARENT FROM THE PROVISIONS OF PARAGRAPH 603A OF THE CONTRACT SPECIFICATIONS, QUOTED IN THE ABOVE LETTER, THAT THE CONTRACTOR MUST BE HELD LIABLE TO THE GOVERNMENT UNDER THE CONTRACT FOR THE SUPPRESSION COSTS AND DAMAGE RESULTING FROM ANY FIRES CAUSED BY HIS OPERATIONS. IN THE PRESENT INSTANCE, THE CONTRACTOR HAS DENIED THAT THE FIRE RESULTED FROM HIS CONTRACT OPERATIONS AND IT SEEMS CLEAR THAT THE CONTRACTOR IS ENTITLED TO HAVE THE ISSUE OF HIS RESPONSIBILITY FOR THE FIRE DECIDED BY THE CONTRACTING OFFICER PURSUANT TO THE PROVISIONS OF ARTICLE 15, RELATING TO DISPUTED QUESTIONS OF FACT ARISING UNDER THE CONTRACT, AND TO BE ACCORDED HIS RIGHT OF APPEAL TO THE HEAD OF THE DEPARTMENT FROM ANY DECISION ADVERSE TO HIM ON ISSUE, AS PROVIDED FOR THEREIN. THE CONTRACTOR HAS SIMILAR RIGHTS UNDER THE DISPUTES CLAUSE IN RESPECT TO DETERMINING THE AMOUNT OF SUPPRESSION COSTS AND DAMAGES WHICH THE GOVERNMENT INCURRED AND SUSTAINED AS A RESULT OF THE FIRE.

IN THE REFERRED TO FINDINGS OF FACT MADE BY THE CONTRACTING OFFICER, THAT OFFICIAL FAILED TO DECIDE THE FACTUAL ISSUES INVOLVED. HIS DECISION AMOUNTED TO NO MORE THAN A DISCLAIMER OF JURISDICTION. SEE PHOENIX BRIDGE COMPANY V. UNITED STATES, 85 C.CLS. 603, 629; THOMAS EARLE AND SONS, INC. V. UNITED STATES, 100 C.CLS. 494, 504; ARCHIBALD E. LIVINGSTON V. UNITED STATES, 101 C.CLS. 625, 638. ACCORDINGLY, THE MATTER IS HEREBY REFERRED TO YOU WITH A REQUEST THAT THE CONTRACTOR BE ACCORDED HIS RIGHTS UNDER THE DISPUTES CLAUSE.

ENCLOSED IS THE FOREST SERVICE'S DUPLICATE FILE OF THE CASE, WHICH CONTAINS CERTIFIED COPIES OF STATEMENTS MADE BY PARTIES PRESENT AT THE TIME OF THE FIRE BEARING UPON THE QUESTION OF THE CONTRACTOR'S RESPONSIBILITY THEREFOR, AS WELL AS A DETAIL OF THE COSTS AND DAMAGES ALLEGED BY THE FOREST SERVICE TO HAVE BEEN INCURRED AND SUSTAINED AS A RESULT OF THE FIRE. ALSO ENCLOSED IS A LETTER DATED JULY 13, 1955, ADDRESSED TO US BY THE CONTRACTOR'S ATTORNEYS, WITH ATTACHMENTS REFERRED TO THEREIN, WHICH INCLUDE COPIES OF STATEMENTS BEARING UPON THE FIRST ISSUE OBTAINED FROM THE CREW OF THE PAUL C. HELMICK COMPANY BY THE CONTRACTOR'S INSURANCE CARRIER. THESE PAPERS ARE TRANSMITTED IN ORDER THAT THE DECIDING OFFICIALS OF YOUR DEPARTMENT MAY HAVE THEM FOR EVALUATION ALONG WITH SUCH OTHER EVIDENCE AS YOU MAY HAVE, OR DEVELOP, IN REACHING A DECISION IN THE CASE. IT IS REQUESTED THAT THEY BE RETURNED WHEN THE MATTER HAS BEEN CONCLUDED.

FURTHER ACTION BY US WILL BE IN ABEYANCE PENDING THE RECEIPT OF A REPORT FROM YOU AS TO THE FINAL ACTION TAKEN BY YOUR DEPARTMENT.

A COPY OF THIS LETTER IS BEING TRANSMITTED TO THE CONTRACTOR'S ATTORNEYS.