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TUMARKIN: REFERENCE IS MADE TO YOUR LETTER OF JUNE 15. THE PRIME CONTRACT WAS CANCELED BY THE DEPARTMENT OF THE ARMY AND THE EXTENT OF THE GOVERNMENT'S LIABILITY. IT IS WELL SETTLED THAT CONTRACTS TO PERFORM WORK OR TO FURNISH SUPPLIES TO CONTRACTORS ENGAGED IN THE PERFORMANCE OF CONTRACTS WITH THE GOVERNMENT DO NOT RESULT IN PRIVITY OF CONTRACT BETWEEN THE SUBCONTRACTORS AND THE UNITED STATES.

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B-123582, MAR. 16, 1956

TO MR. ALLAN L. TUMARKIN:

REFERENCE IS MADE TO YOUR LETTER OF JUNE 15, 1955, ENCLOSING A COPY OF YOUR LETTER OF THE SAME DATE TO THE PHILADELPHIA ORDNANCE DISTRICT, ON BEHALF OF THE MANALPAN MACHINE AND WELDING WORKS, A SUBCONTRACTOR OF THE ACME COPPERSMITHING AND MACHINE COMPANY, A PRIME CONTRACTOR UNDER THE DEPARTMENT OF THE ARMY CONTRACT NO. DA-36-034- ORD-1213/R).

THE PRIME CONTRACT WAS CANCELED BY THE DEPARTMENT OF THE ARMY AND THE EXTENT OF THE GOVERNMENT'S LIABILITY, IF ANY, IN THE MATTER HAS NOT YET BEEN DETERMINED. HOWEVER, IT WOULD APPEAR THAT NEITHER OUR OFFICE NOR THE DEPARTMENT OF THE ARMY WOULD BE WARRANTED IN WITHHOLDING SUCH AMOUNTS AS MAY BE FOUND DUE THE ACME COPPERSMITHING AND MACHINE COMPANY SOLELY BECAUSE OF ITS FAILURE TO MEET ITS SUBCONTRACT OBLIGATIONS. IT IS WELL SETTLED THAT CONTRACTS TO PERFORM WORK OR TO FURNISH SUPPLIES TO CONTRACTORS ENGAGED IN THE PERFORMANCE OF CONTRACTS WITH THE GOVERNMENT DO NOT RESULT IN PRIVITY OF CONTRACT BETWEEN THE SUBCONTRACTORS AND THE UNITED STATES. SEE UNITED STATES V. MUNSEY TRUST COMPANY, 332 U.S. 241.

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