B-127961, NOV. 2, 1956

B-127961, NOV. 2, 1956

TO MR. JACKSON A. CARGILL, ATTORNEY AT LAW:

FURTHER REFERENCE IS MADE TO YOUR CLAIM AS TRUSTEE IN BANKRUPTCY OF MORGAN-RHEIN, INCORPORATED, FOR $7,792.45 UNDER CONTRACT NO. AF 33/604/7508, DATED JUNE 29, 1953.

MORGAN-RHEIN, INCORPORATED, ENTERED INTO A FIXED PRICE SUPPLY CONTRACT WITH THE DEPARTMENT OF THE AIR FORCE ON JUNE 29, 1953, AND WAS ADJUDGED A BANKRUPT IN DECEMBER 1955. THE AERO ELECTRONICS COMPANY, WHO ALSO HAS FILED A CLAIM FOR PAYMENT TO BE MADE DIRECT TO IT OF THE $7,792.45, WAS A SUBCONTRACTOR OF MORGAN-RHEIN, INCORPORATED, UNDER THAT CONTRACT WHICH WAS TERMINATED EFFECTIVE JUNE 1, 1954. BY SUPPLEMENTAL AGREEMENT NO. 1, DATED JANUARY 28, 1955, THE TERMINATION CLAIM OF MORGAN-RHEIN, INCORPORATED, WAS SETTLED EXCEPT FOR AN EXCLUDED CLAIM OF THE AERO ELECTRONICS COMPANY. SUBSEQUENTLY, THE GOVERNMENT AND MORGAN-RHEIN, INCORPORATED, AGREED ON NOVEMBER 8, 1955- - SUPPLEMENTAL AGREEMENT NO. 3--- TO A SETTLEMENT OF THE SAID EXCLUDED CLAIM OF THE SUBCONTRACTOR IN THE AMOUNT OF $7,792.45, WHICH CLAIM RESULTED FROM CERTAIN PURCHASE ORDERS ISSUED TO THE AERO ELECTRONICS COMPANY IN NOVEMBER 1953.

BY LETTERS DATED AUGUST 8, 1956, AND SEPTEMBER 20, 1956, YOUR COMMENTS WERE REQUESTED BY OUR OFFICE REGARDING CERTAIN ASPECTS OF THE INVOLVED CLAIM AND AS TO WHY PAYMENT OF THE AMOUNT DUE THE SUBCONTRACTOR SHOULD NOT BE MADE DIRECT TO IT. SINCE NO REPLY HAS BEEN RECEIVED TO DATE, YOUR CLAIM, AS TRUSTEE IN BANKRUPTCY OF MORGAN RHEIN, INCORPORATED, WILL BE DISPOSED OF HERE ON THE BASIS OF THE PRESENT RECORD.

THE RECORD STRONGLY INDICATES THAT AT LEAST SOME PART OF THE AMOUNT OF $7,792.45 CLAIMED BY YOU COMPRISES AMOUNTS FOR SUPPLIES WHICH THE GOVERNMENT AUTHORIZED AND DIRECTED THE AERO ELECTRONICS COMPANY, AFTER TERMINATION OF THE CONTRACT, TO TRANSFER BOTH THE TITLE AND PROPERTY DIRECT TO IT. IT ALSO INDICATES THAT THE AMOUNT CLAIMED INCLUDES SOME CLAIMS WHICH THE AERO ELECTRONICS COMPANY HAD AGAINST MORGAN-RHEIN, INCORPORATED, FOR WORK PERFORMED AND SUPPLIES DELIVERED TO THE PRIME CONTRACTOR PRIOR TO THE CONTRACT TERMINATION DATE. IN VIEW OF THIS, AND SINCE IT HAS BEEN ALLEGED THAT THE AMOUNT FOUND DUE UNDER SUPPLEMENTAL AGREEMENT NO. 3 WAS MUTUALLY DETERMINED BETWEEN MORGAN RHEIN, INCORPORATED AND THE GOVERNMENT WITHOUT CONSULTING THE AERO ELECTRONICS COMPANY, IT IS NOT POSSIBLE TO DETERMINE WITH ANY REASONABLE DEGREE OF CERTAINTY THE AMOUNT OF PAYMENT, IF ANY, THAT SHOULD BE MADE TO YOU AND AS TO WHICH THE AERO ELECTRONICS COMPANY COULD NOT ESTABLISH ITS CLAIM FOR PAYMENT IN A JUDICIAL DETERMINATION OF THE MATTER.

ACCORDINGLY, IN VIEW OF THE FOREGOING AND IN THE ABSENCE OF A MUTUALLY SATISFACTORY ARRANGEMENT BETWEEN THE ADVERSE CLAIMANTS IN THIS MATTER OR A PROPER JUDICIAL DETERMINATION ESTABLISHING THE RESPECTIVE RIGHTS OF THE CLAIMANTS, OUR OFFICE WOULD NOT BE JUSTIFIED AT THIS TIME IN MAKING PAYMENT OF THE AMOUNT OF $7,792.45 TO YOU AS TRUSTEE IN BANKRUPTCY OF MORGAN-RHEIN, INCORPORATED.