B-131918, JUL. 22, 1957

B-131918, JUL. 22, 1957

TO HONORABLE LEWIS L. STRAUSS, CHAIRMAN, UNITED STATES ATOMIC ENERGY COMMISSION:

REFERENCE IS MADE TO LETTER DATED MAY 20, 1957, FROM THE DEPUTY GENERAL MANAGER REQUESTING AUTHORITY TO REFORM CONTRACT NO. AT/15-1/ 118 WITH THE MALAN CONSTRUCTION COMPANY TO CORRECT AN ALLEGED MUTUAL MISTAKE IN CONNECTION WITH THE PRICE STATED FOR CERTAIN CHANGES IN THE CONTRACT WORK.

BRIEFLY STATED, IT APPEARS THAT MALAN WAS ASKED TO QUOTE A PRICE FOR ADDITIONAL WORK REQUIRED BY REASON OF REVISIONS IN 15 CONTRACT DRAWINGS, THE WORK TO BE PERFORMED BY A PIPING SUBCONTRACTOR AND A SHEET METAL SUBCONTRACTOR. THE CONTRACTOR AND AEC RESIDENT ENGINEER AGREED ON A PRICE OF $971.27 FOR THE WORK COVERED BY TWO OF THE REVISED DRAWINGS, AND THE CONTRACTOR INADVERTENTLY QUOTED THIS PRICE FOR WORK COVERED BY ALL 15 REVISED DRAWINGS. A NUMBER OF OTHER CHANGES IN THE CONTRACT WORK WERE MADE AT THE SAME TIME, AND NEITHER THE CONTRACTOR NOR THE COMMISSION NOTICED THE INADEQUACY OF THE PRICE QUOTED FOR THIS PARTICULAR WORK. THE GOVERNMENT ESTIMATE OF THE COST OF SUCH WORK WAS OVER $19,000. THE CONTRACTOR HAS COMPLETED ALL THE WORK, HAS BEEN PAID ONLY $971.27 THEREFOR, AND REQUESTS PAYMENT OF AN ADDITIONAL $19,850.32 FOR THE WORK COVERED BY THE 13 REVISED DRAWINGS OVERLOOKED IN HIS QUOTATION. THE ADDITIONAL AMOUNT REQUESTED HAS BEEN RECOMMENDED FOR PAYMENT BY THE CONTRACTING OFFICER.

THE EVIDENCE PRESENTED SHOWS CLEARLY THAT THE MISTAKE ALLEGED WAS MADE BY THE CONTRACTOR, AND THAT THE GOVERNMENT SHOULD HAVE KNOWN THE MISTAKE HAD BEEN MADE. UNDER THE CIRCUMSTANCES, IF IT BE ADMINISTRATIVELY DETERMINED THAT THE AMOUNT CLAIMED REPRESENTS THE REASONABLE VALUE OF THE WORK INVOLVED, PAYMENT THEREFOR TO THE CONTRACTOR IS AUTHORIZED. SINCE THE WORK HAS BEEN COMPLETED AND ACCEPTED, REFORMATION OF THE CONTRACT IS UNNECESSARY. REFERENCE TO THIS DECISION SHOULD BE MADE ON THE PAYMENT VOUCHER.