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B-148553, APR. 17, 1962

B-148553 Apr 17, 1962
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THIS SALE WAS CONDUCTED ON JUNE 29. YOU WERE AWARDED ITEM NO. 75. WHICH WAS DESCRIBED IN THE INVITATION AS FOLLOWS: "BEARING. SEAL CLOSURE BEARING WERE THE ONLY BEARINGS VISIBLY DISPLAYED AND THE 22 CARTONS IN WHICH THE REST OF THE BEARINGS WERE CONTAINED WERE ALL MARKED WITH THE SAME FEDERAL STOCK NUMBER. INDICATING THAT THEY CONTAINED THE SAME TYPE OF BEARINGS AS WERE ON VISIBLE DISPLAY. YOU DID NOT OPEN THE 22 CARTONS OR THE PACKAGES INSIDE THE CARTONS IN WHICH THE BEARINGS WERE PACKED. AFTER YOU HAD PAID FOR THE ITEM AND REMOVED IT FROM THE DEPOT YOU DISCOVERED THAT APPROXIMATELY 60 PERCENT OF THE BEARINGS WERE NOT OF THE SEAL CLOSURE TYPE. WERE OPEN BEARINGS. ONE BASIS UPON WHICH YOU NOW REQUEST RELIEF IS THAT SINCE THE ITEM PURCHASED WAS IN FACT MISDESCRIBED.

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B-148553, APR. 17, 1962

TO BEARINGS AND MOTIVE SPECIALTIES COMPANY, INC.:

YOUR LETTER OF MARCH 23, 1962, REQUESTED REVIEW OF OUR CLAIMS DIVISION SETTLEMENT DATED MARCH 8, 1962, WHICH DISALLOWED YOUR CLAIM FOR ADJUSTMENT OR REFUND OF A PART OF THE PURCHASE PRICE FOR ITEM NO. 75, SPOT BID SALE NO. 11-052-S-61-31.

THIS SALE WAS CONDUCTED ON JUNE 29, 1961, BY THE DEFENSE SURPLUS SALES OFFICE AT THE GRANITE CITY ENGINEER DEPOT, GRANITE CITY, ILLINOIS. AS THE HIGH BIDDER, YOU WERE AWARDED ITEM NO. 75, WHICH WAS DESCRIBED IN THE INVITATION AS FOLLOWS:

"BEARING, BALL, ANNULAR, GROUND; SINGLE ROW, RADIAL; NON-LOADING GROOVE; SELF CONTAINED; BOTH RINGS FLUSH; 8 MM BORE DIA, 22 MM OD, 7 MM W O/A; 2 SEAL CLOSURE; RETAINER TYPE; ABEC-1 TOL; STD INTERNAL FIT; GENERAL PURPOSE LUBRICANT; NEW DEPARTMENT NO. 38. UNUSED, GOOD, PACKED. UNIT COST $0.77. TOTAL COST $7,063.21. EST WT 300 LBS. (3110-107-7572) (* C NSF)"

PRIOR TO SUBMITTING YOUR BID YOU WENT TO THE DEPOT TO INSPECT THE ITEM. SEAL CLOSURE BEARING WERE THE ONLY BEARINGS VISIBLY DISPLAYED AND THE 22 CARTONS IN WHICH THE REST OF THE BEARINGS WERE CONTAINED WERE ALL MARKED WITH THE SAME FEDERAL STOCK NUMBER, INDICATING THAT THEY CONTAINED THE SAME TYPE OF BEARINGS AS WERE ON VISIBLE DISPLAY. YOU DID NOT OPEN THE 22 CARTONS OR THE PACKAGES INSIDE THE CARTONS IN WHICH THE BEARINGS WERE PACKED. AFTER YOU HAD PAID FOR THE ITEM AND REMOVED IT FROM THE DEPOT YOU DISCOVERED THAT APPROXIMATELY 60 PERCENT OF THE BEARINGS WERE NOT OF THE SEAL CLOSURE TYPE, BUT WERE OPEN BEARINGS, WHICH YOU ALLEGE TO BE OF MUCH LESS VALUE.

ONE BASIS UPON WHICH YOU NOW REQUEST RELIEF IS THAT SINCE THE ITEM PURCHASED WAS IN FACT MISDESCRIBED, AND INSPECTION OF THE ITEM PRIOR TO SUBMITTING A BID WAS IMPRACTICABLE OR IMPOSSIBLE, THE DISCLAIMER OF WARRANTY SHOULD NOT APPLY. IN OUR DECISION B-130735, JUNE 1, 1959, WE SUSTAINED OUR CLAIMS DIVISION SETTLEMENT DISALLOWING A CLAIM FOR PARTIAL REFUND OF AN AMOUNT PAID FOR CERTAIN WEBB CASES AT A SURPLUS SALE. THE FACTS OF THAT CASE ARE SIMILAR TO THE INSTANT CASE, IN THAT THE 2,976 WEBB CASES, WHICH WERE PARTLY MISREPRESENTED, WERE CONTAINED IN WOODEN BOXES, AND THE CLAIMANT ARGUED THAT IT WAS IMPOSSIBLE OR IMPRACTICABLE FOR HIM TO INSPECT ALL OF THE WEBB CASES. IN HOLDING AGAINST THE CLAIMANT, WE MADE THE FOLLOWING STATEMENTS:

"UNDER ARTICLE 2 OF THE GENERAL SALE TERMS AND CONDITIONS OF THE SALE, WHICH YOU AGREED TO WHEN YOU SUBMITTED YOUR BID ON ITEM NO. 35 ON THE SPOT BID CARD, ALL PROPERTY WAS OFFERED FOR SALE "AS IS" AND "WHERE IS," WITHOUT EXPRESS OR IMPLIED GUARANTY OR WARRANTY OF ANY KIND, INCLUDING THE CONDITION AND DESCRIPTION OF THE PROPERTY, AND IT WAS ALSO STATED IN THAT ARTICLE THAT "THIS IS NOT A SALE BY SAMPLE.'

"IT IS EVIDENT, THEREFORE, THAT YOU HAD ACTUAL NOTICE OF THE FACT THAT THIS WAS NOT A SALE BY SAMPLE AND THAT THE GOVERNMENT'S DESCRIPTION OF THE PROPERTY BEING SOLD UNDER ITEM NO. 35 WAS NOTHING MORE THAN A MERE STATEMENT OF OPINION. MOREOVER, WHILE THE DESCRIPTION OF THE PROPERTY IN QUESTION MAY NOT HAVE BEEN ENTIRELY ACCURATE, YOU DO NOT ALLEGE AND THERE IS NOTHING IN THE RECORD TO INDICATE THAT IT WAS INTENTIONALLY MISDESCRIBED IN THE INVITATION TO BID, OR THAT THE GOVERNMENT AGENTS ACTED OTHER THAN IN GOOD FAITH THROUGHOUT THE SALES TRANSACTION. THE FACTS IN THIS CASE ARE SIMILAR TO THOSE CONSIDERED IN TRIAD CORPORATION V. UNITED STATES, 63 C.CLS. 141, WHEREIN THE COURT REJECTED THE PLAINTIFF'S CLAIM ON THE BASIS THAT A CERTAIN NUMBER OF SURPLUS SADDLES DESCRIBED AS UNUSED WERE LATER FOUND TO HAVE BEEN USED AND RECONDITIONED. SEE ALSO PAXTON- MITCHELL COMPANY V. UNITED STATES, U.S.C.CLS. NO. 109-58, APRIL 8, 1959. IN THE CIRCUMSTANCES, THEREFORE, YOU ARE NOT ENTITLED TO AN ADJUSTMENT IN THE SALES PRICE ON THE BASIS OF MISDESCRIPTION OF THE PROPERTY.

"WE REALIZE THAT THE RESULTS IN SUCH CASES MAY SOMETIMES SEEM HARSH, BUT THE GOVERNMENT HAS USED THE PLAINEST AND CLEAREST LANGUAGE POSSIBLE TO ADVISE PROSPECTIVE BIDDERS THAT IN THESE SURPLUS SALES THE PRINCIPLE OF CAVEAT EMPTOR WILL APPLY RIGIDLY. YOUR CONTENTION THAT IT WAS IMPRACTICABLE, IF NOT IMPOSSIBLE, TO MAKE A COMPLETE INSPECTION, PRIOR TO SUBMITTING YOUR BID, OF ALL THE PROPERTY IN ITEM NO. 35 IN NO WAY MAY BE ACCEPTED AS AFFECTING OUR CONCLUSION THAT YOU ARE NOT ENTITLED TO RELIEF BECAUSE THE MATERIAL PURCHASED AND ACTUALLY DELIVERED TO YOU VARIED FROM THE DESCRIPTION OF THE PROPERTY IN THE BID INVITATION. IF YOU WERE NOT WILLING TO ASSUME THE RISK OF SUCH VARIANCE, YOU SHOULD NOT HAVE SUBMITTED A BID ON THE PROPERTY WITHOUT THE BENEFIT OF A COMPLETE INSPECTION THEREOF. IT MUST, THEREFORE, BE PRESUMED THAT YOU ASSUMED SUCH RISK WHEN YOU SUBMITTED YOUR BID.'

WE BELIEVE THAT THE RATIONALE OF THAT DECISION IS EQUALLY APPLICABLE TO THE FACTS OF YOUR CLAIM. IT SHOULD BE NOTED THAT THIS DECISION IS CONSISTENT WITH RECENT COURT CASES ON THE SAME SUBJECT. THE COURTS HAVE CONSISTENTLY GIVEN CONSIDERABLE WEIGHT TO THE DISCLAIMER OF WARRANTY CLAUSE, AND HAVE STRICTLY APPLIED THE PRINCIPLE OF CAVEAT EMPTOR. PAXTON-MITCHELL COMPANY V. UNITED STATES, 172 F.SUPP. 463 (1959), CITED IN OUR ABOVE QUOTED DECISION, THE COURT STATED THAT THE BUYER WAS REQUIRED TO MAKE AN EFFECTUAL INSPECTION, ALTHOUGH THE VARIANCE BETWEEN THE ITEM AND ITS DESCRIPTION IN THE IFB COULD NOT BE DETECTED BY THE NAKED EYE. THE COURT OBSERVED THAT MALLEABLE IRON COULD BE DISTINGUISHED FROM STEEL BY MICROSCOPIC INSPECTION OR CHEMICAL ANALYSIS, AND THAT THIS WAS THE SORT OF INSPECTION THAT SHOULD HAVE BEEN MADE PRIOR TO SUBMITTING A BID.

YOU ALSO IMPLY THAT THE MISDESCRIPTION OF THE BEARINGS AS SEAL CLOSURE RATHER THAN OPEN TYPE GOES TO THE EXISTENCE OR IDENTITY OF THE CONTRACT. IN REGARD TO THIS ARGUMENT, YOUR ATTENTION IS DIRECTED TO DADOURIAN EXPORT CORPORATION V. UNITED STATES, 291 F.2D 178, 183 (1961). IN WHICH THE COURT SAID:

"THE MAIN GROUND ON WHICH APPELLANT ASSERTS ITS RIGHT TO RESCIND AND TO HAVE ITS DEPOSIT RETURNED IS THAT THERE WAS A MUTUAL MISTAKE OF FACT GOING TO THE EXISTENCE OR THE IDENTITY OF THE SUBJECT MATTER OF THE CONTRACT. THE ARGUMENT RUNS THAT BOTH APPELLANT AND THE GOVERNMENT INTENDED TO BUY AND SELL CARGO NETS MADE OF MANILA ROPE AND WHAT WAS TENDERED WERE SAVE ALL NETS AT LEAST SOME OF WHICH WERE NOT MADE OF MANILA ROPE. INSOFAR AS THE NETS WERE SAVE ALL NETS RATHER THAN CARGO NETS WE ARE NOT IMPRESSED, BECAUSE WE DO NOT BELIEVE THAT THIS WENT TO THE ESSENCE OF THE BARGAIN BETWEEN APPELLANT AND THE GOVERNMENT. WHILE APPELLANT HERE AND IN THE DISTRICT COURT HAS MADE MUCH OF THE FACT THAT THE NETS WERE SAVE ALL NETS RATHER THAN CARGO NETS, IT OBJECTED TO DELIVERY ONLY BECAUSE SOME OF THE NETS WERE NOT MANILA, AND THIS OBJECTION IN TURN WAS BASED ON THE ALLEGED FACT THAT THE NETS HAD BEEN RESOLD AND REPRESENTED AS MANILA NETS. NOR DO WE THINK THE FACT THAT NOT ALL OF THE NETS WERE MANILA GOES TO THE IDENTITY OR THE EXISTENCE OF THE SUBJECT MATTER OF THE CONTRACT. BELIEVE THE SUBJECT MATTER OF THE CONTRACT WAS NETS OR NETS USED IN SHIPPING. THE WORD MANILA WAS MERELY DESCRIPTIVE. APPELLANT HAD NO RIGHT TO RELY ON SUCH DESCRIPTIVE LANGUAGE, BECAUSE ARTICLE 2 OF THE GENERAL SALE TERMS AND CONDITIONS EXPRESSLY DISCLAIMED ANY "GUARANTY, WARRANTY, OR REPRESENTATION, EXPRESS OR IMPLIED, AS TO QUANTITY, KIND, CHARACTER, QUALITY, WEIGHT, SIZE OR DESCRIPTION.' * * *"

AGAIN, THE REASONING OF A RECENT COURT CASE IS APPLICABLE TO THE FACTS YOU PRESENT. THE SUBJECT MATTER OF THE CONTRACT WAS BEARINGS OR BALL BEARINGS. THE WORDS "2 SEAL CLOSURE," AS WELL AS THE WORDS "ANNULAR," "GROUND," "SINGLE ROW," ETC., ARE MERELY DESCRIPTIVE. THE RIGHT TO RELY ON SUCH DESCRIPTION IS DISCLAIMED IN ARTICLE 2 OF THE GENERAL SALE TERMS AND CONDITIONS.

IN VIEW OF THE FOREGOING, THERE IS NO LEGAL BASIS FOR AUTHORIZING AN ADJUSTMENT OR REFUND OF ANY PART OF THE PURCHASE PRICE.

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