B-145320, JUL. 5, 1961

B-145320, JUL. 5, 1961

TO WESTERN NON-FERROUS METALS CORPORATION:

REFERENCE IS MADE TO A LETTER DATED JUNE 13, 1961, IN YOUR BEHALF, FROM KAROL A. KORNGOLD, ATTORNEY AT LAW, REQUESTING RECONSIDERATION OF OUR DECISION DATED MAY 18, 1961, SUSTAINING OUR SETTLEMENT OF FEBRUARY 9, 1961, DISALLOWING YOUR CLAIM FOR A REFUND OF THE $5,000 BID DEPOSIT IN CONNECTION WITH DEPARTMENT OF THE AIR FORCE CONTRACT NO. AF 23/606/ S-149, DATED JUNE 14, 1960.

IN MR. KORNGOLD'S REQUEST FOR RECONSIDERATION, HE REFERS TO CERTAIN MORAL ASPECTS ATTENDING THE CLAIM WHICH HE BELIEVES THE GOVERNMENT OWES A DUTY TO HONOR. MORE SPECIFICALLY, MR. KORNGOLD CONTENDS THAT IN SUBMITTING YOUR BID UNDER INVITATION NO. 23-606-S-60-4, YOU HAD THE RIGHT TO, AND DID, RELY ON THE WEIGHTS SHOWN FOR SOME IDENTICAL TANKS ADVERTISED ON A SIMILAR INVITATION FOR BIDS NO. 03-602-S-60-5 ISSUED BY THE LITTLE ROCK AIR FORCE BASE. MR. KORNGOLD ALSO REFERS TO THAT PART OF THE CASE OF W. E. HEDGER COMPANY V. UNITED STATES, 52 F.2D 31, IN SUPPORT OF HIS REQUEST FOR RELIEF WHEREIN THE COURT, BY WAY OF DICTA, REFERRED TO THE "MUTUAL MISTAKE" PRINCIPLE AS THE BASIS FOR RESCINDING A CONTRACT.

THE FACTS PERTAINING TO THIS CLAIM WERE SET FORTH IN DETAIL IN OUR DECISION TO YOU DATED MAY 18, 1961, AND THERE WOULD APPEAR TO BE NO NEED TO REPEAT SUCH FACTS HERE.

WITH RESPECT TO MR. KORNGOLD'S REFERENCE TO THE MORAL ASPECTS OF THE CLAIM, YOU ARE ADVISED THAT EVEN IF THE RECORD BEFORE US SHOWED THE EXISTENCE OF SOME FACTS WHICH OTHERWISE MIGHT APPEAR TO CONTAIN ELEMENTS WORTHY OF EQUITABLE CONSIDERATION, SUCH FACTS MAY NOT BE RECOGNIZED ON THAT BASIS SINCE THE GENERAL ACCOUNTING OFFICE IS AUTHORIZED TO SETTLE CLAIMS ONLY IN STRICT ACCORDANCE WITH THE LEGAL PRINCIPLES APPLICABLE THERETO AND HAS NO AUTHORITY OR JURISDICTION TO ALLOW CLAIMS BASED SOLELY ON MORAL GROUNDS.

MOREOVER, WE SEE NO SIGNIFICANCE TO THE FACT THAT YOU ALLEGEDLY RELIED UPON THE WEIGHT SHOWN FOR IDENTICAL FUEL TANKS THAT WERE ADVERTISED UNDER INVITATION NO. 03-602-S-60-5 ISSUED ABOUT THE SAME TIME BY THE LITTLE ROCK AIR FORCE BASE. INVITATION NO. 03-602-S-60-5, REFERRED TO BY MR. KORNGOLD, NOT ONLY WAS ENTIRELY UNRELATED TO THE SUBJECT INVITATION BUT WAS INITIATED BY ANOTHER GOVERNMENT AIR FORCE BASE. UNDER SUCH CIRCUMSTANCES, EVEN IF THE LATTER INVITATION COVERED TANKS SIMILAR TO THOSE HERE INVOLVED, THE PROCUREMENT OFFICE OF THE WHITEMAN AIR FORCE BASE MAY NOT LEGALLY BE HELD CHARGEABLE WITH ANY VARIANCE THAT MIGHT HAVE RESULTED BETWEEN WEIGHT OF THE TANKS, AS SHOWN ON THE SUBJECT INVITATION, AND THE ACTUAL WEIGHT, IF INVITATION NO. 23-606-S-60-4 WAS ISSUED BY THE WHITEMAN AIR FORCE BASE IN GOOD FAITH AND THE DESCRIPTIVE INFORMATION, INCLUDING WEIGHT, WAS BASED ON THE BEST AND MOST ACCESSIBLE RECORDS OF THE PROPERTY TO BE SOLD.

LIKEWISE, THERE MAY NOT BE APPLIED THE "MUTUAL MISTAKE" PRINCIPLE TO A TRANSACTION OF THIS KIND WHICH IS COVERED BY A CONTRACT CONTAINING AN EXPRESS DISCLAIMER OF WARRANTY. TO RECOGNIZE THE ,MUTUAL MISTAKE" PRINCIPLE IN THIS CASE WOULD RESULT IN A PREFERENCE BEING GIVEN TO THE APPLICATION OF A GENERAL PRINCIPLE OF LAW OVER A SPECIFIC PROVISION OF THE CONTRACT, NAMELY THE ,DISCLAIMER OF WARRANTY" CLAUSE, WHICH PREVIOUSLY HAD BEEN AGREED TO BY THE PARTIES AS BEING CONTROLLING IN THE EVENT THAT ANY WEIGHT OR OTHER DISCREPANCIES OCCURRED. IN THIS REGARD, IT SHOULD BE NOTED THAT WHILE IN EACH OF THE COURT CASES CITED IN OUR DECISION DATED MAY 18, 1961, TO YOU, AS WELL AS IN PRACTICALLY ALL OTHER SURPLUS SALE CASES OF THIS KIND, A BILATERAL MISTAKE OF SOME NATURE UNDOUBTEDLY WAS MADE, IN NO INSTANCE DID THE COURTS CONSIDER IN ANY OF THOSE CASES, THE "MUTUAL MISTAKE" PRINCIPLE AS BEING CONTROLLING.

IN VIEW OF THE FOREGOING, WE HAVE NO ALTERNATIVE BUT TO AFFIRM OUR DECISION OF MAY 18, 1961.