B-158332, JUN. 7, 1966

B-158332, JUN. 7, 1966

TO THE SECRETARY OF THE NAVY:

BY LETTER DATED JANUARY 6, 1966, H. W. STANFIELD CONSTRUCTION CORP. AND S. L. HAEHN, INC., JOINT VENTURERS, REQUESTED REVIEW BY OUR OFFICE OF THE DECISION RENDERED BY THE ARMED SERVICES BOARD OF CONTRACT APPEALS UNDER DATE OF DECEMBER 8, 1965, ON ITS APPEAL ASBCA NO. 10546, FROM A DENIAL BY THE CONTRACTING OFFICER OF A CLAIM FOR EXTRA COMPENSATION UNDER CONTRACT NO. NBY 50025 WITH THE SOUTHWEST DIVISION, BUREAU OF YARDS AND DOCKS, FOR CONSTRUCTION OF A TACTICAL COMBAT DIRECTION ANNEX BUILDING AT SAN DIEGO.

CONSIDERING THE REQUEST AS A PRESENTATION BY THE CONTRACTOR OF ITS CLAIM FOR SETTLEMENT BY OUR OFFICE, WE HAVE REVIEWED THE ASBCA DECISION REFERRED TO AND THE RECORD BEFORE THE BOARD AS FURNISHED TO US BY THE CHAIRMAN THEREOF, AND ENCLOSE HEREWITH A COPY OF OUR DECISION OF THIS DATE TO THE CLAIMANTS DENYING THE CLAIM.

HOWEVER, WHILE WE CONCUR IN THE CONCLUSION OF THE BOARD THAT THE CLAIM MUST BE DENIED, WE FEEL THAT THE RECORD RAISES A SERIOUS QUESTION AS TO THE ADEQUACY OF THE PROCEDURES ESTABLISHED IN YOUR DEPARTMENT FOR IMPLEMENTATION OF THE DEFENSE STANDARDIZATION PROGRAM PURSUANT TO DOD DIRECTIVE 4120.3.

THE CLAIM ASSERTED IS FOR EXTRA COST ALLEGED TO HAVE BEEN INCURRED IN FURNISHING A PARTICULAR PROPRIETARY BRAND OF COMPRESSOR FOR THE AIR CONDITIONING SYSTEM FOR THE BUILDING. THE CONTRACT SPECIFICATIONS INCORPORATED BY REFERENCE A STANDARD MILITARY SPECIFICATION, MIL-C 21976, FOR THE CHILLER UNIT, INCLUDING COMPRESSOR; IN ADDITION, PARAGRAPH 29.9.2 OF THE CONTRACT SPECIFICATIONS PROVIDED THAT "COMPRESSOR SHALL BE OF THE HERMETIC CENTRIFUGAL TYPE WITH ALUMINUM ALLOY IMPELLERS MOUNTED ON THE MOTOR SHAFT," AND 29.9.3 SPECIFIED A TYPE OF DRIVE MOTOR OF WHICH THE MAXIMUM SPEED IS 3600 R.P.M.

THE BOARD SPECIFICALLY FOUND THAT THE ADDED REQUIREMENTS COULD BE MET ONLY BY THE COMPRESSOR UNIT OF A SINGLE MANUFACTURER.

WE HAVE EXAMINED SPECIFICATION NO. MIL-C-21976, AND FIND THAT IT COVERS "PACKAGED LIQUID CHILLER UNITS CONSISTING ESSENTIALLY OF A CENTRIFUGAL COMPRESSOR, ELECTRIC MOTOR, REFRIGERANT CONDENSER, CHILLER (COOLER, EVAPORATOR), ACCESSORIES AND THE INTERCONNECTING PIPING NECESSARY TO COMPLETE A REFRIGERANT CIRCUIT," IN CAPACITIES FROM 50 TO 600 TONS, TO BE USED IN SUPPLYING CHILLED LIQUID FOR REFRIGERATION AND AIR-CONDITIONING SYSTEMS. DETAILED REQUIREMENTS ARE SET FORTH FOR EACH OF THE SEVERAL ITEMS INCLUDED AND FOR SAMPLING, INSPECTION AND TESTING. THE SPECIFICATION CONTAINS NO PROVISION FOR DEPARTURES FROM ITS REQUIREMENTS; IT DOES, IN PART 6.2, SPECIFICALLY PRESCRIBE IN DETAIL THE DATA TO BE USED IN PROCUREMENT DOCUMENTS, AND EVEN THIS DIRECTION CONTAINS NO GENERAL PROVISION AUTHORIZING OTHER OR ADDITIONAL REQUIREMENTS.

AS INDICATED IN THE DECISION OF THIS OFFICE TO YOU DATED JULY 23, 1964, B -153404, IT IS OUR VIEW THAT THE PROMULGATION OF A STANDARD FEDERAL OR MILITARY SPECIFICATION CONSTITUTES A DELIBERATE DETERMINATION AT THE HIGHEST LEVEL OF COMPETENCE THAT SUPPLIES CONFORMING THERETO WILL ADEQUATELY MEET AT LEAST THE NORMAL AND USUAL REQUIREMENTS OF THE GOVERNMENT FOR ARTICLES OF THE KIND COVERED THEREBY. SECTION 1202 OF THE ARMED SERVICES PROCUREMENT REGULATION MAKES THE USE OF SUCH STANDARD SPECIFICATIONS MANDATORY UPON THE MILITARY DEPARTMENTS, EXCEPT IN THE CIRCUMSTANCES SPECIFICALLY STATED IN THE REGULATION. IN THE LIGHT OF THIS BACKGROUND WE ARE DISTURBED BY THE FINDING OF THE ASBCA IN THE SUBJECT CASE THAT THE MILITARY SPECIFICATION CITED IN THE PROCUREMENT WAS SO MODIFIED AS TO MAKE IT FOR ALL INTENTS AND PURPOSES A RESTRICTIVE SPECIFICATION OF AN ARTICLE PROPRIETARY TO A SINGLE MANUFACTURER, AND THE FURTHER STATEMENT BY THE BOARD THAT "THE RECORD INDICATES THAT THE MANUFACTURER RAISES ITS LIST PRICE TO APPELLANT'S SUBCONTRACTOR, INFERRING THAT IT HAD PARTICIPATED IN PREPARATION OF THE SPECIFICATION, AND INTENDED TO PREVENT BIDDING BY OTHER MANUFACTURERS WHO DID NOT USE ITS METHOD OF MANUFACTURE.'

SINCE THE RECORD BEFORE THIS OFFICE CONTAINS NO INDICATION OF THE JUSTIFICATION OR AUTHORIZATION FOR THE DEPARTURE FROM THE STANDARDIZED SPECIFICATION REFERRED TO, IT IS REQUESTED THAT WE BE FURNISHED A STATEMENT WITH RESPECT THERETO, TOGETHER WITH A COPY OF, OR REFERENCE TO, THE PROCEDURE ESTABLISHED BY YOUR DEPARTMENT, OR BY THE BUREAU OF YARDS AND DOCKS OR ITS SUCCESSOR, FOR THE AUTHORIZATION OF SUCH DEVIATIONS AND ADVICE AS TO WHETHER SUCH PROCEDURES WERE FOLLOWED IN THE INSTANT CASE.