B-125761, NOV. 3, 1955

B-125761, NOV. 3, 1955

TO THE HONORABLE SECRETARY OF THE NAVY:

REFERENCE IS MADE TO A LETTER DATED OCTOBER 10, 1955, WITH ENCLOSURES, FROM THE ASSISTANT SECRETARY OF THE NAVY, RELATIVE TO AN ERROR ALLEGED BY THE NORTHWESTERN AUTO PARTS COMPANY TO HAVE BEEN MADE IN ITS BID DATED AUGUST 2, 1955, ON WHICH CONTRACT NO. N665S-24831 DATED AUGUST 10, 1955, IS BASED.

BY INVITATION NO. B-19-56 DATED JULY 15, 1955, THE UNITED STATES NAVAL SUPPLY DEPOT CLEAR FIELD, OGDEN, UTAH, REQUESTED BIDS FOR THE SALE OF TRUCK, AUTOMOTIVE PARTS AND MACHINERY. IN RESPONSE TO THE INVITATION THE NORTHWESTERN AUTO PARTS COMPANY SUBMITTED A BID OFFERING TO PURCHASE, AMONG OTHERS, ITEM 28 COVERING 144 CYLINDER HEADS WITH VALVES IN AN UNUSED, FAIR CONDITION FOR $16.60 EACH OR A TOTAL OF $2,390.40. UPON ACCEPTANCE OF THE BID, THE COMPANY PAID THE CONTRACT CONSIDERATION AND RECEIVED DELIVERY OF THE MATERIAL. THEREAFTER, BY LETTER DATED AUGUST 31, 1955, THE COMPANY ACKNOWLEDGED RECEIPT OF THE MATERIAL AND ALLEGED THAT THE MATERIAL WAS FOUND NOT TO BE ACCORDING TO THE DESCRIPTION IN THE INVITATION IN THAT INSTEAD OF CYLINDER HEADS WITH VALVES IN UNUSED CONDITION IT RECEIVED USED CYLINDER HEADS WITHOUT ANY VALVES AND REQUESTED THAT A LETTER OF AUTHORIZATION FROM THE SUPPLY DEPOT BE FURNISHED IN ORDER TO SHIP THE MATERIAL BACK. BY LETTER DATED SEPTEMBER 2, 1955, THE CONTRACTING OFFICER INFORMED THE CONTRACTOR WITH REGARD TO ITEM 28 OF THE INVITATION THAT A CORRECTED DESCRIPTION WAS FORWARDED TO ALL BIDDERS ON OR ABOUT JULY 26, 1955, AND THAT THE RECORDS INDICATED THAT THE COMPANY WAS ON THE BIDDERS LIST AT THIS TIME AND WAS MAILED A COPY OF THE AMENDMENT. THE CONTRACTING OFFICER FURTHER STATED THAT HE COULD NOT AUTHORIZE SHIPMENT OF THE MATERIAL BACK TO THE HOLDING ACTIVITY. THE COMPANY BY LETTER DATED SEPTEMBER 6, 1955, STATED THAT IT HAD NOT RECEIVED THE AMENDMENT AND SINCE IT HAD RECENTLY PURCHASED CYLINDER HEADS WITHOUT VALVES AT A COST OF $3.67 EACH, SUBMITTED A CLAIM IN THE AMOUNT OF $13 EACH FOR THE 144 CYLINDER HEADS RECEIVED.

THERE WAS NOTHING ON THE FACE OF THE BID SUBMITTED BY THE COMPANY TO INDICATE THAT THE BID OF $16.60 EACH FOR ITEM 28 WAS NOT AS INTENDED. THE CONTRACTING OFFICER REPORTS THAT THE COMPANY WAS ON THE BIDDERS LIST AND SHOULD HAVE RECEIVED THE AMENDMENT TO THE INVITATION AND THAT IT WAS REASONABLY APPARENT THAT THE BIDDER DID NOT INSPECT THE PROPERTY PRIOR TO SUBMISSION OF THE BID SINCE AN INSPECTION WOULD HAVE REVEALED THE ACTUAL CONDITION OR COMPLETENESS OF CYLINDER HEADS ON ITEM 28. ALTHOUGH THE BID WAS HIGHER THAN THE SEVEN OTHER BIDS ON ITEM 28 WHICH RANGED FROM $6.13 TO $1.48, SUCH DIFFERENCE WOULD NOT NECESSARILY INDICATE AN ERROR SINCE A WIDE RANGE IN THE PRICES BID ON USED PROPERTY IS NOT UNUSUAL.

ORDINARILY IN THE SALE OF PERSONAL PROPERTY BY DESCRIPTION THERE IS AN IMPLIED WARRANTY THAT THE PROPERTY WILL CORRESPOND WITH THE DESCRIPTION. WHERE THERE IS AN EXPRESS DISCLAIMER OF WARRANTY, HOWEVER, NO SUCH WARRANTY MAY BE IMPLIED FROM THE DESCRIPTION OF THE PROPERTY SOLD, AS THE DISCLAIMER EXTENDS TO AND INCLUDES THE DESCRIPTION. SEE LUMBRAZO V. WOODRUFF, 175 N.E. 525; W. E. HEDGER COMPANY V. UNITED STATES, 52 F.2D 31, CERTIORARI DENIED 284 U.S. 676; TRIAD CORPORATION V. UNITED STATES, 63 C.CLS. 151; AND I. SHAPIRO AND COMPANY V. UNITED STATES, 66 C.CLS. 424. IN THE PRESENT CASE, PARAGRAPHS 1 AND 2 OF THE GENERAL SALE TERMS AND CONDITIONS URGED PROSPECTIVE BIDDERS TO INSPECT THE PROPERTY PRIOR TO SUBMITTING BIDS AND, STATING THAT THE DESCRIPTION WAS BASED ON THE BEST AVAILABLE INFORMATION, ADVISED PROSPECTIVE BIDDERS THAT THE PROPERTY WAS OFFERED FOR SALE "AS IS" AND "WHERE IS; " THAT THE GOVERNMENT MADE NO GUARANTY, WARRANTY, OR REPRESENTATION AS TO QUALITY OR DESCRIPTION OF THE PROPERTY OR AS TO ITS FITNESS FOR ANY USE OR PURPOSE, AND THAT "NO CLAIM WILL BE CONSIDERED FOR ALLOWANCE OR ADJUSTMENT OR FOR RESCISSION OF THE SALE BASED UPON FAILURE OF THE PROPERTY TO CORRESPOND WITH THE STANDARD ECTED.' THUS, THE DISCLAIMER WAS SPECIFIC AS TO THE DESCRIPTION OF THE PROPERTY.

MOREOVER, THE RECORD INDICATES THAT NO INSPECTION OF THE PROPERTY WAS MADE BY THE COMPANY PRIOR TO THE SUBMISSION OF ITS BID. IN THIS CONNECTION, THE LAW IS CLEAR THAT WHERE PROPERTY OF THE CHARACTER HERE INVOLVED IS OFFERED FOR SALE BY THE GOVERNMENT ON AN "AS IS" BASIS WITHOUT WARRANTY OR GUARANTY OF ANY KIND, A BIDDER WHO FAILS TO TAKE ADVANTAGE OF THE OPPORTUNITY TO INSPECT CANNOT SUBSEQUENTLY RECOVER ON THE GROUND THAT THE QUALITY OF THE PROPERTY IS INFERIOR TO THAT EXPECTED. 30 COMP. GEN. 188, AND COURT CASES CITED IN THAT DECISION.

ACCORDINGLY, THERE IS NO LEGAL BASIS FOR AUTHORIZING ANY ADJUSTMENT IN THE PRICE FIXED IN THE CONTRACT FOR THE MATERIAL INVOLVED.