BOARD OF CONTRACT APPEALS
U.S. GOVERNMENT PRINTING OFFICE
WASHINGTON, DC 20401
In the Matter of )
)
the Appeal of )
)
PROFESSIONAL PRINTING OF )
KANSAS, INC. ) Docket No. GPO BCA 28-93
Jacket No. 774-586 )
Purchase Order M-2450 )
For the Appellant: Professional Printing of Kansas, Inc.,
Emporia, Kansas, by Frederic G. Antoun, Jr., Esq., Attorney at
Law, Chambersburg, Pennsylvania.
For the Government: Kerry L. Miller, Esq., Associate General
Counsel, U.S. Government Printing Office.
Before FOSS, Administrative Judge.
DECISION AND ORDER
I. STATEMENT OF THE CASE
By Notice of Appeal, dated October 15, 1993,1 Professional
Printing of Kansas, Inc. (Appellant or Contractor), 315
Constitution, Emporia, Kansas 66801, filed a timely appeal of the
final decision of Contracting Officer Raymond Macdonald, dated
July 21, 1993, of the U.S. Government Printing Office's
(Respondent or GPO or Government), Denver Regional Printing &
Procurement Office (DRPPO), Denver Federal Center, Building 53,
Room D-1010, Denver, Colorado 80225-0347, denying the Appellant's
equitable adjustment claim of $5,661.59 for additional work
performed under its contract identified as Jacket No. 774-586,
Purchase Order M-2450, and assessing a 5% price reduction in the
contract price (R4 File, Tabs A, B, and F).2 See Board Rules,
Rules 1(a) and 2. For the following reasons, the Contracting
Officer's final decision is hereby AFFIRMED, in part, and
REVERSED, in part, and the appeal is ALLOWED to the extent
indicated.
II. BACKGROUND
1. On November 12, 1992, the Respondent awarded the Appellant
a contract for the production of 2,000,000 blank forms (plus or
minus 1%) entitled "1099 Paper w/2 Micro-perfs," which had been
requisitioned by the Defense Printing Service (DPS) for the
Defense Finance and Accounting Service (DFAS or customer-agency)
(R4 File, Tab B).3 The estimated purchase price of the contract
was $17,821.00, and the forms were to be delivered to the DFAS
facility at Lowry Air Force Base, Denver, Colorado, by December
1, 1992.4 Id.
2. Among other provisions, the contract specifications stated:
GPO Contract Terms (GPO Pub. 310.2), in effect on date of this
order, applies.5
DESCRIPTION: Blank forms.
PERFORATIONS: Perforate across the full 8-1/2" dimension with two
micro-perforations located 3-11/16" from top and bottom edge.
NOTE: Stock used must be suitable for use on a Xerox 4050 or 4090
printer, and will process on a Bell and Howell Mail Starr 500 or
Pitney Bowes table top folder.
PAPER-COLOR AND KIND: White, High Quality Xerographic [C]opier,
Laser Printer. JCP Code No.: O-61. Basis-500 sheets: 17" X 22"
(size) and 20-24 pounds (weight).6
PACKING: Pack suitable per shipping container. Pallets required.
Include on all labels: Stock No. 1099 Paper.7
* * * * * * * * * *
Id. [Emphasis added.] Furthermore, the following provisions of
GPO Contract Terms, which the contract incorporates by reference,
are relevant to this dispute:
Supplemental Specifications
2. Packing.
The method of packing indicated in the specifications must be
accomplished in accordance with the following interpretations.
The method and manner of packaging for preservation and required
storage and/or transportation shall be in accordance with either
the National Motor Freight Classification (NMFC) or the Uniform
Freight Classification (UFC) tariff. The material used in
packing must be of such quality as to insure arrival of the
printed matter at its destination in a satisfactory and usable
condition. Each packing unit must be uniform in size and
quantity contained therein. Unless otherwise indicated, each
shipping container must not exceed 45 pounds when fully packed.
Quantities which fill less than one-half a shipping container may
be wrapped in shipping bundles.
* * * * * * * * * *
(c) Shrink-film wrapping. Wrap in packages not to exceed 10
inches in height or in quantities as ordered. Place a piece of
lightweight chipboard or newsboard, cut to the same size as the
printed work, on the bottom of the printed work, and wrap with
heat-shrink film of suitable thickness and quality. The label
may be placed inside the wrap, on the top or on the end.
(d) Boxing. Solid pack in suitable paperboard boxes, which have
closely fitted sides and ends. Tops and bottoms must be securely
fastened.
* * * * * * * * * *
(j) Shipping containers. Only new corrugated or solid fiberboard
containers may be used. Containers must be made in accordance
with Federal Specification PPP-B-636 and any amendments thereto.
Unless otherwise provided in the specifications, bursting
strength shall be 275 pounds per square inch minimum. Containers
must be packed solidly (top and sides) with the material laid
flat on the bottom of the containers (never stand on end); top
and bottom pads of corrugated fiberboard shall be used and be in
solid contact with the top and bottom of the container. In the
event the material does not fit snugly on the top or sides, open-
cell pads or thicknesses of corrugated board must be added. Top
and bottom flaps must be closed and fastened firmly with water-
resistant adhesive. Adhesive must be applied over not less than
50 percent of the area of contact between the inner and outer
flaps. The bottom flaps may be stapled instead of sealed,
provided this is done before the container is packed.
At the contractor's option, containers may be sealed with tape
which must completely cover the butted edges of the flaps and
extend at least 2 inches on the ends of the containers. . . .
Noncompliance with the packaging specifications may be cause for
the Government to reject the shipment, at destination, and return
it to the contractor at his expense. After giving notice of the
deficiency and affording the contractor an opportunity and a
reasonable time to correct, the Government may, at its option
repackage in accordance with the specifications and charge all
costs to the contractor.
* * * * * * * * * *
Contract Clauses
* * * * * * * * * *
4. Changes.
(a) The Contracting Officer may at any time, by written order,
and without notice to the sureties, if any, make changes within
the general scope of this contract, in any one or more of the
following:
* * * * * * * * * *
(2) Method of shipment or packing.
* * * * * * * * * *
(b) If any such change causes an increase or decrease in the cost
of, or the time required for, performance of any part of the
work, whether or not changed by the order, the Contracting
Officer shall make an equitable adjustment in the contract price,
the delivery price, or both, and shall modify the contract.
* * * * * * * * * *
14. Inspection and Tests.
* * * * * * * * * *
(f) The Government has the right either to reject or to require
correction of nonconforming supplies. Supplies are nonconforming
when they are defective in material or workmanship or are
otherwise not in conformity with requirements. The Government
may reject nonconforming supplies with or without disposition
instructions.
* * * * * * * * * *
(j) The Government shall accept or reject supplies as promptly as
practicable after delivery, unless otherwise provided.
Government failure to inspect and accept or reject the supplies
shall not relieve the contractor from responsibility, nor impose
liability on the Government, for nonconforming supplies.
(k) Inspections and tests by the Government do not relieve the
contractor or responsibility for defects or other failures to
meet requirements discovered before acceptance. Acceptance shall
be conclusive, except for latent defects, fraud, gross mistakes
amounting to fraud, or as otherwise provided.
15. Warranty.
Definitions. "Acceptance," as used in this article means the act
of an authorized representative of the Government by which the
Government assumes for itself, or as an agency of another, owner-
ship of existing supplies, or approves specific services as
partial or complete performance.
"Correction," as used in this article, means the elimination of a
defect.
"Supplies," as used in this article means the end item furnished
by the contractor and related services. The word does not
include "data."
(a) Contractor's obligations. (1) Notwithstanding inspection and
acceptance by the Government of supplies furnished or any
condition concerning the conclusiveness thereof, the contractor
warrants that for 120 days from the date of the check tendered as
final payment-
(i) All supplies furnished will be free from defects in material
or workmanship and will conform to all requirements; and
(ii) The preservation, packaging, packing, and marking, and the
preparation for, and shipment of such supplies will conform with
requirements.
* * * * * * * * * *
(b) Remedies available to the Government. (1) The Contracting
Officer or his/her authorized representative shall give written
notice to the contractor of any breach of warranties in paragraph
(a)(1) above within 120 days, unless otherwise specified, from
the date of the check tendered as final payment.
(2) With a reasonable time after the notice, the Contracting
Officer may either-
(i) Require, by written notice, the prompt correction or
replacement of any supplies or parts thereof (including
preservation, packaging, and marking) that do not conform within
the meaning of paragraph (a)(1) above; or
(ii) Retain such supplies and reduce the contract price by an
amount equitable under the circumstances.
* * * * * * * * * *
See GPO Contract Terms, Supplemental Specifications, �� 2;
Contract Clauses, �� 4, 14, 15. [Emphasis added.] Although the
Respondent made GPO Contract Terms part of the contract, it did
not incorporate its "Quality Assurance Through Attributes
Program" (QATAP) in the agreement;8 i.e., the box next to the
statement "Quality Assurance Through Attributes Program (GPO Pub.
310.1) in effect on date of this order, applies. Level ___," was
not checked.
2. As indicated above, although the specifications called for
white copier paper equal to JCP Code No. O-61, it also allowed
the Appellant to choose between 20 and 24 pound basis weight
stock (R4 File, Tab B). The Contractor selected 20 pound paper
to produce the forms (R4 File, Tab D). Once the job was finished,
the Appellant Contractor placed the completed order in cartons
and shipped the boxes to DFAS. It is undisputed that the forms
were timely delivered to the customer-agency on December 1, 1992,
as required by the specifications (R4 File, Tab B).
3. On March 29, 1993, nearly four months after delivery, the
DPS notified the DRPPO that the paper furnished by the Appellant
was jamming on the Bell & Howell inserter, and asked GPO to test
the stock to ensure that it was at least 20 pound paper (R4 File,
Tab C, Louie Memorandum).9 See Boortz Declaration, � 4; Williams
Letter.
4. On April 6, 1993, Compliance Officer Boortz telephoned
the Contractor and informed it that the DFAS was reporting
paper jams on its Bell & Howell equipment (App. Exh. No. 5).
The Appellant immediately discussed the matter with its
attorney, Frederic G. Antoun, Jr.,10 who thought that a
mechanical adjustment would fix the problem. However, when
the Contractor called Boortz back, it was told that the
customer-agency had determined that the paper was the cause
of the jamming. Id.
5. Before taking any further steps, the Compliance Officer sent
samples of the paper to the Respondent's QCTD for testing (R4
File, Tab D). See Boortz Declaration, � 5. On April 16, 1993,
the QCTD issued its report which showed that the paper stock: (a)
had a basis weight of 20.1 pounds and met the specifications in
that regard;but (b) fail to meet the standards for porosity and
stiffness (R4 File, Tab D, Miscellaneous Materials Test Report
No. 266643, Quality Control and Technical Department, dated April
16, 1993) (QCTD Report)).11 GPO's inspector also stated:
JCP Specification not applicable.
*JCP O-61 is written for 24 lb. paper only. Sample is 20 lb.
Test results are compatible with what 20 lb. O-61 might be,
except for smoothness (too rough).
Paper which is too porous and too limp could result in
runnability problems, as explained by Bell & Howell.
Id. [Emphasis added]. See also Boortz Declaration, � 5; Subt
Declaration, � 3; App. Exh. No. 1. Boortz advised the Contractor
of the test results. See Boortz Declaration, � 5.
6. On or about April 19, 1993, representatives of the parties
attended a test of the paper stock at Lowry Air Force Base, in
which forms continued to feed improperly into the Bell & Howell
inserter and jam the machine. See Boortz Declaration, � 6;
Macdonald Declaration, � 4; Williams Letter; App. Exh. No. 1.
Antoun, who participated in the test on behalf of the Appellant,
noted that the paper was curling, which he thought was caused
either by moisture or from the stock being stored for an
extensive period without shrink-wrapping. See App. Exh. Nos. 1
and 3. See also Williams Letter. Therefore, he suggested that
one pallet of blank forms (100,000-150,000 copies) be returned to
the Contractor for shrink-wrapping to see if that would solve the
problem. See Boortz Declaration, �� 6, 7; Macdonald Declaration,
� 4; Williams Letter; App. Exh. No. 1.
7. As arranged, the Appellant repacked a "test" quantity of
blank forms (148,000 sheets) with shrink-wrap and shipped them
back to the DFAS on April 28, 1993 (R4 File, Tab E). See also
App. Exh. No. 2. The shrink-wrapped paper did not jam in the
Bell & Howell inserter. Therefore, the remaining blank forms
(1,440,000 sheets) were returned to the Contractor for shrink-
wrapping, which was completed on June 30, 1993 (R4 File, Tab E).
See also App. Exh. No. 2. The parties agree that after the stock
was shrink-wrapped, there were no further running problems. See
Boortz Declaration, � 7; Macdonald Declaration, � 4; Williams
Letter.
8. While it was still in the process of shrink-wrapping the
last batch of forms, the Appellant raised the matter of payment
for the repacking operation with the Contracting Officer, and was
told that no extra compensation was warranted since, as far as
GPO was concerned the Contractor was simply correcting its own
performance failure. See Boortz Declaration, � 8; Macdonald
Declaration, � 5. In addition, the Appellant was advised that
the Respondent intended to reduce the contract price by 5%
because its paper stock did not meet specifications.12 The
Appellant's contrary position was conveyed to Boortz in a letter
dated June 16, 1993, from Antoun, who said:
As I indicated in our telephone conversation, Professional
Printing does not agree that the product produced under the above
Jacket should have been shrink-wrapped with chipboard. The
specifications only indicate that the stock is to be packed
"suitable" in a shipping container. No individual boxes are
required, no wrapping was required, and no particular number of
units per carton were required.
Since the product being produced is paper to be used on laser
printers, and since laser paper (or any paper) tends to pick up
moisture, the agency should have known that if it was going to
store the material for a long period of time, it would need to be
wrapped. Professional, on the other hand, had no way of knowing
that the material was to be stored over a period of a year or
more, and used only a rate of 50,000 or so per month, as opposed
to being used all on one job.
You will recall that as I observed the test run, I determined
that the problem with the job was either that it had picked up
moisture and thus, curled, or that, due to the length of time it
was stored it began to lift up in the center or curl due to the
fact that it wasn't shrink-wrapped for long term or permanent
storage. To solve that problem we picked up several boxes, and
took them back to Professional Printing, and shrink-wrapped them
with chipboard, to keep the product flat and moisture free during
long term storage. That product was shipped back, and the agency
used it without difficulty. Your office has now requested that
the contractor pick up the entire order, shrink-wrap it with
chipboard, repackage it, and reship it to the agency. While I
agree that this is the exact solution required to give the agency
a product which will work well, and have instructed Professional
Printing to follow your directions regarding the repackaging, we
have not agreed to accomplish this task at no additional charge
to the government.
Our position was, and still remains that the specifications did
not require the appropriate packaging, and thus the contractor
can not be held liable for the cost of appropriate packaging
after the job is produced.
Professional will follow your instructions, and after shrink-
wrapping with chipboard, repackaging and shipping is completed,
will submit a request for additional payment (contract
modification) to your office.
With regard to the proposed price reduction of 5% for the failure
to meet specifications, Professional's position which I have
already related to you by telephone, is that no price reduction
is in order. First, I understand that test results indicate that
there is a minor variation in smoothness on the tested stock. I
do not believe that variation is uniform throughout the 2 million
pieces, but even if it is, a smoothness variation of this minor
and [sic] nature should not warrant any price reduction.
Secondly, you have indicated that the stock does not meet the
suggested stiffness proposed by the manufacturer (Bell and
Howell) for use in it's [sic] equipment. Meeting those
requirements was not mandated by the specifications. Rather, the
specifications required the stock to meeting a specific JCP code-
and to "be suitable" for use on specific equipment. Properly
packaged, the stock will function now and in the future on the
listed equipment. As a result, we do not believe any price
reduction is in order.
See App. Exh. No. 3.
9. Thereafter, on July 12, 1993, the Appellant submitted a
$5,661.59 bill to cover the cost of repacking the blank forms
(R4 File, Tab E).13 See also Boortz Declaration, � 8; App. Exh.
No. 2. Accompanying the claim was a letter from Antoun, who
wrote, in pertinent part:
I am sure you will recall from prior conversations and
correspondence that Professional agreed, in order to create a
usable product for the agency, that they would repack the job by
chip boarding and shrink-wrapping, and reship it to Lowry Air
Force Base.
Your office's determination was that the pickup, shrink-wrapping,
repackaging, and redelivery of the forms needed to be
accomplished at no additional cost to the government; on the
other hand, Professional Printing did not believe they should
bear the cost of performing these functions, as they were not
required by the specifications, and did not agree to do so at no
additional cost to the government.
* * * * * * * * * *
With regard to the argument that the forms do not meet Bell &
Howell's desired stiffness standards, the specifications did not
require the forms to meet any particular suggestions of the
manufacturer for stock. Rather, the specifications simply
indicated that the stock must be suitable for use on the named
Xerox printers and the Bell & Howell Mail Star [sic] 500 or
Pitney Bows [sic] Tabletop Folder. We have tested the forms on
both folding machines, and they work fine, when properly
protected from moisture and climate variations by shrink-
wrapping. The agency has performed the same tests, with the
sample batch that was wrapped appropriately (not according to
specs), and they likewise reported have no problems with the
stock. . . . .
As a result of doing the repacking, some new information has come
to light. When the agency provided Professional's trucker with
the boxes to be repacked, they inadvertently included 20 boxes
from a previous job. That job was Jacket 675-993. It was the
same job which the agency advised us during our test run at Lowry
that they had used without difficulty, in order to establish that
it was Professional's product, not the machinery, which was
causing the problem. When Professional received these 20 boxes
back, they opened several in order to determine if they too were
sent back because they required shrink-wrapping. While doing so,
they discovered that they had in fact produced Jacket 675-993.
The major difference between the two Jackets is that 675-993
required the product to be shrink-wrapped in units of 500.14
This of course prevented it from curling due to moisture
absorption or climate changes. As agreed by the Bell & Howell
technician during our on-site review of the product, it was the
curling that caused the problem with the feeding of the forms
through the equipment.
In light of the above, and all of the facts surrounding this
matter, Professional is requesting a Contract Modification to
compensate them for the pickup, shrink-wrapping, repackaging, and
reshipment of the 148,000 sheets (the test) and 1,440,000 sheets
completed and shipped on June 30, 1993 (the reason for the
difference between the amount Professional repackaged and the
contract amount appears to be the quantity that the agency had
already utilized). . . .
Id.
10. By letter dated July 21, 1993, the Contracting Officer
issued his final decision rejecting the Appellant's equitable
adjustment claim, stating, in pertinent part:
. . . [T]he Government has a right to complete compliance to the
specifications. As you have acknowledged, Professional Printing
has not done this since the paper does not meet the
specifications.
You also have acknowledged, the paper is outside the recommended
guidelines that Bell and Howell has for stiffness which could
very well cause a problem running the paper.
We have allowed Professional Printing to repack the paper to
mitigate their damages and this also allowed the Government to
use the paper.
Allowing Professional Printing to do this was at your request
during the on-site inspection.
* * * * * * * * * *
I could have rejected the entire shipment and told you to replace
it with paper that is in compliance to the specifications.
Instead you were allowed to repack the stock to minimize your
costs.
See R4 File, Tab F. In addition to denying the claim, Macdonald
informed the Contractor that the Respondent was taking a discount
of 5% on the contract price-"the smallest discount under the
guidelines of GPO Contract Terms, GPO Pub. 310.1"-for accepting
paper stock "which is not in complete compliance with the
specifications."15 Id. See also Boortz Declaration, � 8.
11. Thereafter, on August 15, 1993, the Contracting Officer
issued Contract Modification No. 1, reducing the contract price
by 5% "[a]s compensation for accepting the defective product,"
because "[a]n inspection of [paper] samples supplied from this
order revealed that the product failed to meet the specifications
. . ." (R4 File, Tab F).
12. The Appellant timely appealed the Contracting Officer's
final decision to the Board.
III. ISSUES PRESENTED
Two issues are involved in this appeal:
1. Did the language in the "PACKING" specification, which told
the Appellant to "[p]ack suitable per shipping container," also
require the Contractor to shrink-wrap the original shipment of
blank forms? Stated otherwise, could the Appellant reasonably
assume from the fact that the "SHRINK FILM PACK" box on the
Purchase Order was not checked that shrink-wrapping was not
required, thus entitling the Contractor to an equitable
adjustment for performing that additional work?
2. Was it proper for the Contracting Officer to take a 5%
reduction in the order price on the ground that the paper stock
used for the blank forms did not meet the contract's
specifications for JCP O-61 paper?16
IV. POSITIONS OF THE PARTIES
a. Appellant
The Appellant advances three reasons why the Contracting
Officer's final decision denying its equitable adjustment claim
and taking a reduction of the contract price should be reversed.
First, the Contractor says that the blank forms it produced for
the DFAS conformed to the contract specifications in all
respects. See Appellant's Brief, dated June 20, 1994, at 3 (App.
Brf.); RPTC, at 4. In that regard, the Appellant relies on the
QCTD Report to show that it furnished "White, High Quality
Xerographic Copier, Laser Printer" stock, with a basis weight of
20 pounds, as required by the contract (R4 File, Tab D). See
App. Brf., at 3. The Contractor maintains that the note in the
QCTD Report stating that the JCP O-61 specifications apply only
to 24 pound paper, and not 20 pound stock-which it calls a
Government admission against interest-is dispositive of the issue
regarding whether or not it supplied paper in accordance with the
specifications; i.e., the Appellant's stock met all measurable
requirements, and even if the paper was "too rough" (the only
defect found by the GPO inspector, based on her estimation of JCP
O-61 standards for 20 pound stock), that deficiency did not
affect the use of the product on the Bell & Howell equipment.
Id. Therefore, the Contractor submits that the "irrefutable
facts" show that its paper met all of the contract's "design
specifications," and, when properly shrink-wrapped for extended
storage, all of the "performance specifications," as well. See
App. Brf., at 4.
The Appellant's second contention in support of its equitable
adjustment claim is that shrink-wrapping was not required by the
contract specifications, and thus repacking with shrink-wrap
constituted additional compensable work. Id.; RPTC, at 5. The
crux of the Contractor's argument is that when the Respondent
issued the Purchase Order with instructions to "pack suitable per
shipping container," but without checking the "SHRINK FILM PACK"
box, it authorized the method of packaging used to ship the blank
forms.17 See App. Brf., at 5; RPTC, at 5. In the Appellant's
view, the plain meaning of the phrase "pack suitable per shipping
container," when examined against the "Packing" language in GPO
Contract Terms, refers to the number of forms to be packed in the
carton used for shipping, and has nothing to do with how the
forms will be packaged within the box itself. See App. Brf., at
5 (citing GPO Contract Terms, Supplemental Specifications, � 2).
Furthermore, the Contractor says that nothing in the relevant
supplement specification requires shrink-wrapping. Id. Instead,
the Appellant believes that the Respondent made a mistake when it
drafted the contract specifications, and it is seeking to rectify
its error by a novel interpretation of clear contract language
which would shift responsibility for correcting the resulting
problem to the Contractor.18 See App. Brf., at 4-5. The
Appellant does not dispute the efficacy of shrink-wrapping the
forms for extended storage, but it asserts that an unvoiced need
for this sort of packaging cannot trump the express words of the
contract itself, which do not require shrink-wrapping.19 See
App. Brf., at 5.
Finally, the Contractor states that the Respondent is not
entitled to take a 5% price reduction in the contract price
because there was nothing wrong with the paper stock it used for
performance. See App. Brf., at 5; RPTC, at 4-5. In that regard,
the Appellant says that GPO assessed the discount for a failure
to meet Bell & Howell's paper specifications. See App. Brf., at
4. However, the Contractor objects to the Government's use of
Bell & Howell's requirements on the ground that they are not
incorporated in the contract, and besides it was only asked to
produce a form which would run on the manufacturer's equipment.20
Id. Furthermore, the Appellant contends that GPO's own test
results cannot be used as the basis for finding the stock
defective, because the QCTD Report admits that JCP O-61 standards
do not apply to 20 pound paper. See App. Brf., at 5-6.
Moreover, the Contractor alleges that the report's conclusion
that the paper was rejectable because it was "too rough" is not
sustainable, because it is based on JCP O-61 criteria for 20
pound paper which was fabricated by the inspector for the express
purpose of measuring and analyzing the disputed stock; i.e., the
standards are post-award and not referenced in the agreement.
See App. Brf., at 5. Therefore, the Appellant asserts that since
it was only required to manufacture the blank forms on paper
which was "White, High Quality Xerographic Copier, Laser Printer"
stock, with a basis weight of 20 pounds (R4 File, Tab B), and the
QCTD Report says that its product satisfied those standards, the
Contracting Officer's action rejecting the forms and taking a
price reduction was unjustified.
Accordingly, for these reasons, the Contractor submits that: (1)
it is entitled to extra compensation in the amount of $5,661.59,
for the additional labor, materials, and freight costs it
incurred in repacking and redelivering the blank forms to DFAS;
and (2) the Respondent's reduction in the contract price should
be set aside. See App. Brf., at. 6; RPTC, at 5.
B. Respondent
Like the Appellant, the Respondent also supports its position in
this case-that the Contracting Officer's decision denying the
equitable adjustment claim and assessing a 5% discount in the
contract price was correct-with three arguments. First, relying
on "black letter" law which holds that the Government is entitled
to strictly enforce compliance with its specifications,21 GPO
maintains that the Contractor is not entitled to recover the
costs it sustained in repacking the blank forms so that they
would run on the Bell & Howell machinery. See Res. Brf., at 3
(citing American Electric Contracting Corp. v. United States, 579
F.2d 602 (Ct. Cl. 1978); Red Circle Corp. v. United States, 185
Ct. Cl. 1 (1968); Jefferson Construction Co. v. United States,
151 Ct. Cl. 75 (1960); International Lithographing, GPO BCA 1-88
(December 29, 1989), 1989 WL 384986; Rose Printing Co., GPO BCA
2-87 (June 9, 1989), 1989 WL 384981; Fry Communications, Inc.,
GPO BCA 1-87 (June 1, 1989), 1989 WL 384980; Mid-America Business
Forms Corp., GPO BCA 8-87 (December 30, 1988), 1988 WL 363330;
Dependable Printing Co., Inc., GPO BCA 5-84 (September 12, 1985),
1985 WL 154847); RPTC, at 4. The Respondent says that strict
compliance is enforced in one of two ways: (1) outright rejection
and reproduction of the defective product; or, (2) accepting the
nonconforming supplies at a reduced price, if that is in the
Government's best interest. See Res. Brf., at 3-4. Which remedy
is in invoked is totally at the procuring agency's option. See
Res. Brf., at 4 (citing Famous Model Co., Inc., ASBCA No. 12526,
68-1 BCA � 6902; Cherry Meat Packers, Inc., ASBCA No. 8974, 1963
BCA � 3937). GPO alleges that since there is no question that
the blank forms did not function as specified, the Contracting
Officer properly exercised his authority and elected to have the
Appellant fix the defect by repacking the forms. See Res. Brf.,
at 4 (citing Boortz Declaration, � 7; Macdonald Declaration, �
4); RPTC, at 3-4. However, because the jamming problem was a
clear performance failure on the part of the Appellant, GPO
expected the Contractor to bear all of the correction costs. See
Res. Brf., at 4 (citing Macdonald Declaration, � 5); RPTC, at 6.
Second, GPO asserts that there are two relevant specifications in
this dispute, namely, the forms must be: (1) usable on the Xerox
4050 or 4090 printer, the Bell & Howell Mail Starr 500 inserter,
and the Pitney Bowes tabletop folder; and (2) packed "suitable"
for shipment. See Res. Brf., at 4; RPTC, at 5. The Respondent
states that the plain language of these contract terms shows that
they are "performance specifications," which, by definition, gave
the Appellant total control over all aspects of the manufacturing
and delivery process, and made it solely responsible for seeing
that the Government received a product which met all performance
requirements. See Res. Brf., at 4. Consequently, the
Contractor's claim that the specifications are defective because
the "SHRINK FILM PACK" box was not checked, is simply contrary to
law. See Res. Brf., at 5 (citing J. L. Simmons Co., Inc. v.
United States, 188 Ct. Cl. 684, 412 F.2d 1360 (1969); Frank
Briscoe Co., Inc. and Huber, Hunt & Nichols, Inc. (Joint
Venture),GSBCA No. 3568, 73-2 BCA � 10,204; Blake Construction
Co., Inc., GSBCA No. 3590, 73-1 BCA � 9819; Red-Samm Mining Co.,
Inc. (Joint Venture), ASBCA No. 17324, 73-1 BCA � 9811; Allied
Contractors, Inc., ASBCA No. 5254, 60-2 BCA � 2749). In other
words, regardless of the technical cause of the performance
failure-e.g., moisture absorption, insufficient stiffness of
paper, curling of paper, or some unknown reason-once it was
apparent that the paper would not run on the specified machinery,
curing the problem was the Appellant's responsibility, and it
chose a method (repacking with shrink-wrap) which proved
successful.22 See Res. Brf., at 5; RPTC, at 5-6.
Finally, the Government contends that it was entitled to take a
5% discount, or a $891.05 reduction in the contract price, for
accepting forms produced on nonconforming paper.23 See Res.
Brf., at 6; RPTC, at 4. GPO says that the discount was proper
because the stock failed to meet JCP O-61 specifications for
smoothness-a physical characteristic which is unaffected by the
weight of the paper.24 See Res. Brf., at 6 (citing Subt
Declaration, � 4).
Accordingly, for these reasons, the Respondent submits that the
appeal should be denied in its entirety because the Appellant has
failed to prove that it is legally entitled to an equitable
adjustment for correcting the defective forms, while the
Government has shown that its 5% discount was justified. See
Res. Brf., at. 6; RPTC, at 4.
V. DECISION
This appeal leaves the Board with a feeling of deja vu. Not long
ago, the Board issued an opinion in another dispute involving
these same parties in which it reversed a GPO contracting
officer's denial of the Appellant's equitable adjustment claim
for reprinting forms which had been rejected for quality defects
on the ground, inter alia, that the real reason why the original
forms would not function properly could be traced to the
Government's inadequate or defective design, and not to any
production deficiency on the Contractor's part; thus, under the
doctrine of "implied warranty of specifications," the Government
bore the responsibility for nonperformance. See Professional
Printing of Kansas, Inc., GPO BCA 02-93 (May 19, 1995), slip op.
at 62, 1995 WL 488488 (citing Colorgraphics Corp., GPO BCA 16-87
(March 31, 1989), slip op. at 22-24, 1989 WL 384970) (hereinafter
Professional Printing I).25 Now, the parties, once again, have
presented the Board with a controversy in which the Respondent
says essentially, "I ordered forms which were to run a certain
way, and the Appellant has delivered a product which does not
work," and the Contractor replies in effect, "well, I followed
the Government's specifications, and delivered what the contract
asked for, so if the forms failed to run properly, the fault must
be in the specifications."26 In so many words, this case, too,
is about whether the doctrine of "implied warranty of
specifications" has shifted the normal risk of nonperformance
from the Contractor to the Government.27
In Professional Printing I, the Board observed that it is well-
established that when the Government requires a contractor to
follow detailed plans and specifications, it impliedly warrants
that if the specifications are followed the result will be
adequate and acceptable. See Professional Printing I, supra,
slip op. at 55 (citing United States v. Spearin, 248 U.S. 132, 39
S.Ct. 59, 63 L.Ed. 166 (1918); Blake Construction Co. v. United
States, 987 F.2d 743 (Fed. Cir. 1993); Hol-Gar Manufacturing
Corp. v. United States, 175 Ct. Cl. 518, 360 F.2d 634 (1966);
D.E.W., Inc., ASBCA No. 35896, 94-3 BCA � 27,182; Santa Fe
Engineers, Inc., ASBCA No. 45228, 93-2 BCA � 25,555). However,
if the specifications are defective and the warranty is breached,
the contractor is entitled to compensation equal to the amount
expended in trying to comply with the defective specifications.
See Hol-Gar Manufacturing Corp. v. United States, supra, 360 F.2d
at 638. The rationale for the rule is that:
The Government's implied warranty of the adequacy of its
specifications is based on its responsibility for the
specifications rather than any presumed "superior
knowledge" in the sense of greater expertise. When one
of the parties to a contract undertakes to prepare the
specifications, that party is responsible for the
correctness, adequacy and feasibility of the
specifications, and the other party is under no
obligation to check and verify the work product of the
party who assumed responsibility for the preparation of
the specifications, even though he may be as much or
more of an expert than the party who prepared the
specifications. Courts have held many times that a
bidder need not verify the correctness and adequacy of
Government specifications prior to bidding. Ithaca Gun
Co. v. United States, 176 Ct. Cl. 477 (1966); Harvey-
Whipple, Inc. v. United States, 169 Ct. Cl. 689 (1965).
See Professional Printing I, supra, slip op. at 55; Colorgraphics
Corp., supra, slip op. at 22 (quoting Consolidated Diesel
Electric Corp., ASBCA No. 10496, 67-2 BCA � 6669, at
30,951-52).28 A contractor seeking to avail itself of this
"implied warranty" principle has the burden of showing that the
Government's specifications were somehow defective and that they
were the cause of the problems it experienced.29 See
Professional Printing I, supra, slip op. at 56; Printing
Unlimited, GPO BCA 21-90 (November 30, 1993), slip op. at 17,
1993 WL 516844; Editors Press Incorporated, GPO BCA 3-90
(September 4, 1991), slip op. at 12-13, 1991 WL 439271. Accord
Wornick Family Foods Co; ASBCA Nos. 41317, 41318, 41319, 94-2 BCA
� 26,808; Bradley Construction, Inc., ASBCA No. 39733, 91-2 BCA �
23,974; AGH Industries, Inc., ASBCA Nos. 258, 26535, 85-1 BCA �
17,784.
Furthermore, as the Board noted in Professional Printing I,
Government contracts like the one in dispute often contain both
"performance" and "design" specifications. See Professional
Printing I, supra, slip op. at 56 (citing Wornick Family Foods
Co., supra; 94-2 BCA at 133,339; Falcon Jet Corp., DOT CAB No.
78-32, 82-1 BCA � 15,477, at 76,691). There is a clear
distinction in the law between these two types of specifications
in determining the respective rights and obligations of the
parties to a Government contract. Therefore, the starting point
of the Board's analysis cases like this, where the doctrine of
"implied warranty of specifications" is at issue, is a
determination of the type of specification involved. See
Professional Printing I, supra, slip op. at 56 (citing Aleutian
Constructors v. United States, 24 Cl. Ct. 372 (1992)).
Generally, design specifications explicitly state how the
contract is to be performed and permit no deviations, while
performance specifications focus on the results to be obtained,
and leave it to the contractor to determine how to achieve that
objective. See Professional Printing I, supra, slip op. at 57
(citing Neal & Co. v. United States, 19 Cl. Ct. 463, 468 (1990),
aff'd, 945 F.2d 385 (Fed. Cir. 1991); Stuyvesant Dredging Co. v.
United States, 834 F.2d 1576, 1582 (Fed. Cir. 1987);
J.L. Simmons Co., Inc. v. United States, supra, 188 Ct. Cl. at
684, 412 F.2d at 1360). As the Board has explained:
[There are] DESIGN specifications which set forth precise
measurements, tolerances, materials, in process and finished
product tests, quality control, inspection requirement, and other
specific information. Under this type specification, the
Government is responsible for design and related omissions,
errors, and deficiencies in the specifications and drawings.
PERFORMANCE specifications set forth operational characteristics
desired for the item. In such specifications, design,
measurements and other specific details are not stated or
considered important so long as the performance requirement is
met. Where an item is purchased by a performance specification,
the contractor accepts general responsibility for design,
engineering, and achievement of the stated performance
requirements. The contractor has general discretion and election
as to detail but the work is subject to the Government's reserved
right of final inspection and approval or rejection.
See Professional Printing I, supra, slip op. at 57; Colorgraphics
Corp., supra, slip op. at 23 (quoting Monitor Plastics Co., ASBCA
No. 14447, 72-2 � 9,626 (1972)). [Original emphasis.] See also
Big Chief Drilling Co. v. United States, 26 Cl. Ct. 1276, 1294
(1992) ("Design specifications set forth in detail the materials
to be employed and the manner in which the work is to be
performed, and the contractor is 'required to follow them as one
would a road map.' [Citation omitted.] Whereas, performance
specifications simply set forth an objective or end result to be
achieved, and the contractor may select the means of
accomplishing the task. [Citation omitted.]"). This distinction
is important because, while the Government is entitled to
performance in strict compliance with design specifications,
performance specifications are not as rigidly enforced since the
contractor is expected to exercise his ingenuity and select the
means for achieving the standard of performance required. See
Professional Printing I, supra, slip op. at 58 (citing Carmon
Construction, Inc., GSBCA No. 11227, 92-2 BCA � 25,001, at
124,615; Falcon Jet Corporation, supra, 82-1 BCA at 76,691-92).
Accord J.L. Simmons Co., Inc. v. United States; supra; Centre
Manufacturing Co. v. United States, 183 Ct. Cl. 115, 392 F.2d 229
(1968); J.D. Hedin Construction Co. v. United States, 171 Ct. Cl.
70, 347 F.2d 235 (1965); R&M Mechanical Contractors, Inc., DOT
CAB No. 75-51, 76-2 BCA � 12,084; Santa Fe Engineers, Inc., ASBCA
No. 22950, 79-2 BCA � 14,084.
Three specifications-the contract requirements for "PAPER" and
"PACKING," and the "DESCRIPTION NOTE"-are involved in this case.
In that regard, the "PACKING" specification is clearly central to
the first question presented in this appeal, while the "PAPER"
requirement goes to the heart of the second issue. The
"DESCRIPTION NOTE," on the other hand, overlaps both issues.
When the Board considers these specifications in light of the
applicable law, it draws the following conclusions:
A. The "PACKING" specification, as supplemented by GPO Contract
Terms, is a mixture of design and performance elements. However,
the relevant language is clearly performance in nature, making
the Appellant totally responsible for ensuring that the order of
blank forms was "suitably" packed not only for transportation,
but for "preservation" and "required storage," as well. The
decision to use shrink-wrap or some other packing material for
that purpose rested with the Contractor. Accordingly, the post-
delivery shrink-wrapping of the forms in this case was not a
"constructive change" in the contract, and the Appellant is not
entitled to an equitable adjustment for performing that
additional work.
The dispute involving the "PACKING" specification concerns the
meaning of one word-"suitable"-in the contractual requirement
"[p]ack suitable per shipping container," the terms relating to
palletizing and labeling apparently having been performed
satisfactorily (R4 File, Tab B). See GPO Contract Terms,
Supplemental Specifications, �� 3, 7. More to the point, the
parties are divided over whether "suitable" packing excluded the
requirement for shrink-wrapping the ordered forms before placing
them in the shipping containers, especially since the
specification's "SHRINK FILM PACK" box was not checked, as the
Appellant claims, see App. Brf., at 4-5; RPTC, at 5, or whether
the provision for "suitable" packing was a "performance"
requirement, which even without that box being checked,
nonetheless obligated the Contractor to shrink-wrap the forms to
ensure their subsequent usability by the DFAS, as the Respondent
alleges, see Res. Brf., at 4-5; RPTC, at 5-6. Clearly, if the
Appellant is correct, then its after-delivery shrink-wrapping of
the forms is a compensable "change," within the meaning of the
"Changes" clause. See GPO Contract Terms, Contract Clauses, �
4(a)(2). However, if GPO is right, then the Contractor failed to
provide "suitable" packing for the original shipment, and the
subsequent shrink-wrapping of the forms merely rectified the
Appellant's previous poor performance, for which the Government
could not be charged. Id., �� 14(f), 15(b)(2)(i). In the
Board's view, the Government has the better argument.
As near as the Board can determine from its own research, the
question concerning the "PACKING" specification presents a
matter of first impression. On the other hand, even though the
Board is in uncharted waters, settled principles of contract
interpretation provide the "philosophical compass for navigating
a way through the shoals of this . . . dispute." See Custom
Printing Co., supra, slip op. at 29; Banta Co., GPO BCA 03-91
(November 15, 1993), slip op. at 25, 1993 WL 526843. Suffice it
to say that the Appellant's allegation during the prehearing
conference that the "PACKING" specification is ambiguous,30 see
RPTC, at 5, triggers a family of special interpretive rules which
the Board will apply to the "four corners" of the parties'
agreement to determine which of the two conflicting meanings is
correct, or whether both readings may be reasonably derived from
the contract terms.31 See Custom Printing Co., supra, slip op.
at 29; MPE Business Forms, Inc., supra, slip op. at 42; The
George Marr Co., GPO BCA 31-94 (April 23, 1996), slip op. at
40-41, 1996 WL 273662; Professional Printing I, supra, slip op.
at 47; Web Business Forms, Inc., GPO BCA 16-89 (September 30,
1994) slip op. at 17, 1994 WL 837423; Universal Printing Co.,
supra, slip op. at 26, n. 27; RD Printing Associates, Inc., GPO
BCA 2-92 (December 16, 1992), slip op. at 9, 13, ns. 9 and 15,
1992 WL 516088; R.C. Swanson Printing and Typesetting Co., supra,
slip op. at 41; General Business Forms, Inc., GPO BCA 2-84
(December 3, 1985), slip op. at 16, 1985 WL 154846. Those
"ambiguity" principles have been set forth at length in numerous
past cases, including the parties' previous dispute, see
Professional Printing I, supra, slip op. at 47-48, and are well-
known.32 However, the rules governing ambiguous contract
language only apply if the meaning of the disputed terms are not
susceptible to interpretation through the usual rules of contract
construction, the most basic of which is that the document should
be interpreted as a whole. See Custom Printing Co., supra, slip
op. at 32; MPE Business Forms, Inc., supra, slip op. at 45; The
George Marr Co., supra, slip op. at 43; Professional Printing I,
supra, slip op. at 49; Webb Business Forms, Inc., supra, slip op.
at 19-20; McDonald & Eudy Printers, Inc., supra, slip op. at 16;
R.C. Swanson Printing and Typesetting Co., supra, slip op. at 42;
General Business Forms, Inc., supra, slip op. at 16. See also
Hol-Gar Manufacturing Corp. v. United States, 169 Ct. Cl. 384,
388, 351 F.2d 972, 975 (1965). Hence, all provisions of a
contract should be given effect and no provision is to be
rendered meaningless. See Custom Printing Co., supra, slip op.
at 33; MPE Business Forms, Inc., supra, slip op. at 45; The
George Marr Co., supra, slip op. at 43-44; Professional Printing
I, supra, slip op. at 49-50; Webb Business Forms, Inc., supra,
slip op. at 20; General Business Forms, Inc., supra, slip op. at
16 (citing Raytheon Co. v. United States, 2 Cl. Ct. 763 (1983)).
See also Fortec Constructors v. United States, 760 F.2d 1288,
1292 (Fed. Cir. 1985); Pacificorp Capital, Inc. v. United States,
25 Cl. Ct. 707, 716 (1992), aff'd 988 F.2d 130 (Fed. Cir. 1993);
Avedon Corp. v. United States, 15 Cl. Ct. 771, 776 (1988); United
States v. Johnson Controls, Inc., 713 F.2d 1541, 1555 (Fed. Cir.
1983); Martin Lane Co. v. United States, 193 Ct. Cl. 203, 215,
432 F.2d 1013, 1019 (1970). In other words, a contract should be
interpreted in a manner which gives meaning to all of its parts
and in such a fashion that the provisions do not conflict with
each other, if this is reasonably possible. See Custom Printing
Co., supra, slip op. at 33; MPE Business Forms, Inc., supra, slip
op. at 46; The George Marr Co., supra, slip op. at 44;
Professional Printing I, supra, slip op. at 50; Webb Business
Forms, Inc., supra, slip op. at 20. Accord Granite Construction
Co. v. United States, 962 F.2d 998 (Fed. Cir. 1992); B. D. Click
Co. v. United States, 614 F.2d 748 (Ct. Cl. 1980). That is, an
interpretation which gives a reasonable meaning to all parts of a
contract will be preferred to one which leaves a portion of it
"useless, inexplicable, inoperative, void, insignificant,
meaningless, superfluous, or achieves a weird and whimsical
result." See Custom Printing Co., supra, slip op. at 33; MPE
Business Forms, Inc., supra, slip op. at 46; The George Marr Co.,
supra, slip op. at 44-45 (citing Gould, Inc. v. United States,
935 F.2d 1271, 1274 (Fed. Cir. 1991), quoting Arizona v. United
States, 216 Ct. Cl. 221, 235-36, 575 F.2d 855, 863 (1978));
Professional Printing I, supra, slip op. at 50-51. See also ITT
Arctic Service, Inc. v. United States, 207 Ct. Cl. 743, 524 F.2d
680, 684 (1975) (contract interpretation should be "without
twisted or strained out of context [and without] regard to the
subjective unexpressed intent of one of the parties. . ."). An
interpretation that effectively deletes a major portion of the
contract cannot and will not be sanctioned.33 See Avedon Corp.
v. United States, supra, 15 Cl. Ct. at 776 (citing W.G. Cornell
Co. v. United States, 179 Ct. Cl. 651, 666-67, 376 F.2d 299, 309
(1967)).
As indicated above, because the Respondent relies on the "strict
compliance" rule, the Board's analysis begins with an
identification of the kind of requirement-"design" or
"performance"-at issue. At first blush, the Purchase Order's
"PACKING" language, to the extent that it is in controversy,
looks deceptively simple; i.e., "[p]ack suitable per shipping
container" (R4 File, Tab B). However, when the packing
specifications contained in GPO Contract Terms are also
considered, the contract's overall packing requirements are
extremely detailed. See GPO Contract Terms, Supplemental
Specifications, � 2. Furthermore, it is also clear that when the
provisions are viewed in the aggregate, the packing specification
is composed of both design requirements (e.g., that each packing
unit be of a uniform size and quantity; each shipping container
not exceed 45 pounds when fully packed, unless otherwise
indicated; only new corrugated or solid fiberboard containers
conforming to Federal Specification PPP-B-636 and any amendments,
may be used; containers shall have a bursting strength of 275
pounds per square inch minimum, etc.) and performance elements
(e.g., allowing the contractor to choose packaging which conforms
to either the National Motor Freight Classification (NMFC) or the
Uniform Freight Classification (UFC) tariff; to select packing
material "of such quality as to insure arrival of the printed
matter at its destination in a satisfactory and usable
condition;" to seal containers with tape, provided that the
butted edges of the flaps are completely covered and extend at
least 2 inches on the ends of the containers, etc.). Id.
Indeed, the Purchase Order's "[p]ack suitable per shipping
container" appears to be nothing more than a paraphrase of the
supplemental specification's "[s]olid pack in suitable paperboard
boxes," and that language is clearly performance in nature. Id.,
� 2 (d) (Boxing) However, despite the aforementioned design
elements, the Board is persuaded that the contract's packing
specification is, by and large, a performance requirement in
which operational goals predominate over precise measurements,
tolerances, and materials. Cf. Custom Printing Co., supra, slip
op. at 37-38 (specification predominantly design in nature);
Professional Printing I, supra, slip op. at 59 (same) (citing
Neal & Co. v. United States, supra, 19 Cl. Ct. at 468; Falcon Jet
Corp., supra, 82-1 BCA at 76,691). Consequently, except for the
need to meet certain design characteristics with respect to
packing materials, the Appellant had full discretion, and was
totally responsible, for planning and achieving the stated
performance objectives for packing. Id. Accord Big Chief
Drilling Co. v. United States, 26 Cl. Ct. 1276, 1294 (1992).
Thus, the dispute over the "PACKING" specification boils down to
two questions: (1) what were the performance objectives which the
Appellant was expected to accomplish; and (2) was its method of
packing "suitable" for that purpose?34 The Contractor has the
burden of proof on the "suitability" issue. See Braceland
Brothers, supra, slip op. at 26; a & E Copy Center, supra, slip
op. at 22, 1996 WL 812881; Web Business Forms, Inc., supra, slip
op. at 13-14; Printing Unlimited, supra, slip op. at 18. Accord
Clean Sweep Janitorial and Law Service, ASBCA Nos. 35442, 35568,
91-3 BCA � 24,089 (landscaping services contractor did not prove
willow oak trees called for in the contract were unsuitable for
planting).
The first inquiry essentially involves determining what packing
costs the Contractor was required to incur under the contract.
See Unicom Systems, Inc., ASBCA No. 29468, 84-3 BCA � 17,675, at
88,162. In that regard, the Appellant reads the contract as
requiring nothing more than packing the forms in shipping
containers which were strong enough to ensure that the boxes
would arrive at the DFAS without loss or damage to the contents.
No one disputes that the Appellant used shipping containers which
adequately protected the forms on their way to the customer-
agency, and there is no suggestion in the record of any loss or
damage to the forms in transit. Since the Appellant apparently
believes that the scope of its packing responsibilities began in
its shipping room and ended at the DFAS' receiving dock, it
contends that it did all it was required to do under the
contract, and that its boxes met the contractual test of
"suitability." However, the Contractor's view of its
responsibilities is too narrow, and it completely misapprehends
the performance nature of the packing specification in toto.
The performance objectives of the contractual packing
requirements are clearly spelled out in the first three sentences
of the supplemental specification:
The method of packing indicated in the specifications must be
accomplished in accordance with the following interpretations.
The method and manner of packaging for preservation and required
storage and/or transportation shall be in accordance with either
the National Motor Freight Classification (NMFC) or the Uniform
Freight Classification (UFC) tariff. The material used in
packing must be of such quality as to insure arrival of the
printed matter at its destination in a satisfactory and usable
condition. . . . .
See GPO Contract Terms, Supplemental Specifications, � 2.
[Emphasis added.] From the above, it can be seen that "suitable"
packing under the contract is not simply confined to protecting
the supplies for shipment, but also extends to taking whatever
steps are necessary for their preservation and required storage,
based on the realistic assumption that delivered supplies might
not be used immediately. Only packing which accomplished all
three aims-transportation, preservation, and storage-can be
considered "suitable" under the contract. Thus, under the
specification, the Respondent expected the Appellant to consider
not only the method of packing before the forms were handed over
to its freight agent for delivery to DFAS, but also any
additional protection which might be needed for preservation and
required storage.
The Appellant frankly admits that "shrink-wrapping the product
may be necessary to cause it to function at maximum efficiency if
stored in a non-climate controlled facility over an extended
period of time," and concedes that by shrink-wrapping the forms
in this case the performance problems on the Bell & Howell
inserter were resolved. See App. Brf., at 5. Its reason for not
shrink-wrapping the original shipment of forms was that the
"PACKING" specification's "SHRINK FILM PACK" box was not checked.
However, the Armed Services Board of Contract Appeals (ASBCA) has
held that in a contract based on a performance specification, the
contractor's expertise is central to the bargain. See Fairfield
Machine Co., Inc., ASBCA No. 22704, 85-2 BCA � 17,969. Thus, in
that case the ASBCA reasoned, in pertinent part:
Appellant's second basis for claiming the second 10-ring test to
be a constructive change is not as readily disposed of. The
Arsenal insisted that the machine demonstrate "an acceptable
degree of reliability" by completing a 10-ring test "without
interruption caused by machine breakdown." [Finding omitted.]
That requirement is not set forth in the specifications nor does
the contract explicitly prescribe the level of reliability to be
attained and demonstrated by the machine.
The absence of an explicit provision does not necessarily
preclude the existence of a contractual requirement relating to
reliability of operation. Where, as here, the Government enters
into a contract for supplies on the basis of a performance
specification, the know-how of the contractor is a critical
element of the transaction. The contractor, in those
circumstances, is expected to apply its knowledge and experience
to producing a product that will not only render the performance
called for but also will operate with the degree of reliability
and dependability generally expected of such equipment. C.L.M.
Sales Co., DOT CAB No. 77-32, 79-1 BCA � 13,852. The
specification told appellant that the machine to be procured
would replace existing equipment performing a described function.
Appellant actually observed the existing equipment in operation
and noted the surrounding operations and circumstances. With
that knowledge and its accumulated know-how in design and
construction of special machines, it was obliged to construct and
deliver a machine that not only met the specified performance
requirements but operated at a level of reliability appropriate
for the breech ring manufacturing process in which it would be
utilized.
Id., 85-2 BCA at 90,084. [Emphasis added.] See also
Intercontinental Manufacturing Co., Inc. v. United States, 4 Cl.
Ct. 591, 599-600 (1984) (". . . [W]ith an end-product
specification such as is here involved, . . . it is incumbent
upon the aggrieved contractor to explain why, . . . it would have
been beyond its properly expected skills and abilities to have
foreseen the manufacturing problems that were encountered and the
solutions they demanded. . . . One who is in the business of
understanding and applying the machining techniques and skills
necessary to translate a drawing design into a fabricated end
product must be held to be aware of the limiting characteristics
of those common materials he may be called upon to work with. To
have it any other way would oblige every buyer to become his own
expert-hardly a plausible idea.").
Measured against these principles, the Appellant's claim that the
contract only required it to place nonshrink-wrapped forms in
shipping cartons because that the Government's failed to mark the
"SHRINK FILM PACK" box on the Purchase Order, is without merit.
This is not a situation where the parties discussed the packaging
arrangements prior to award and the Government later changed its
mind and asked for something else. See Unicom Systems, Inc.,
supra.35 Here, the express terms of the contract also required
the Appellant to incorporate the preservation and storage of the
blank forms into its packing plans. See GPO Contract Terms,
Supplemental Specifications, � 2. The Contractor, after all, was
working under a performance requirement, and had full discretion
with respect to the materials and means for achieving the packing
specification's stated ends. Thus, if the Appellant thought
shrink-wrapping was the best method for preserving and protecting
the forms, then it was expected to perform that task as part of
the contract, in accordance, of course, with the "shrink-film
wrapping" clause of the supplement specification. Id., � 2(c).
No special direction from the Respondent was necessary. In the
Board's opinion, any other interpretation of the packing
specification here carries the distinct risk of elevating
substandard performance into a contractual norm. See
Intercontinental Manufacturing Co., Inc. v. United States, supra,
4 Cl. Ct. at 599. Accordingly, the Board finds that the limited
meaning given to the "PACKING" specification by the Contractor
effectively reads the supplemental requirements of GPO Contract
Terms out of the agreement, and hence is unreasonable. On the
other hand, the Government's interpretation of the "PACKING"
specification, because it focuses on the performance nature of
that requirement, encompasses all of its goals-transportation,
preservation, and storage-and is the only reasonable
interpretation of the contract. As the Board has stated on
numerous occasion, when a contract admits to only one
construction, it is not ambiguous.36 See e.g., The George Marr
Co., supra, slip op. at 55; Professional Printing I, supra, slip
op. at 54; Webb Business Forms, Inc., supra, slip op. at 21; R.C.
Swanson Printing and Typesetting Co., supra, slip op. at 48.
Accord Falcon Jet Corp., supra, 82-1 BCA at 76,693 (citing Martin
Lane Co. v. United States, supra; General Dynamics Corp., DOT CAB
76-29, 79-1 BCA � 13,858).
In light of the Board's holding with regard to the performance
requirements of the "PACKING" specification, the question
concerning whether the Appellant "suitably" packed the forms is
easily disposed of. The record leaves no doubt that the
Contracting Officer's primary interest in how the blank forms
were packed was in ensuring that they were usable on the
equipment specified after delivery. See Macdonald Declaration, �
4. Indeed, the supplemental packing specification expressly
requires that ordered supplies be received "in a satisfactory and
usable condition." See GPO Contract Terms, Supplemental
Specifications, � 2 . Furthermore, it is undisputed that when
the forms were used after a period of storage they failed to
operate properly on the Bell & Howell inserter, as required by
the contract (R4 File, Tab B). The record evidence is conclusive
that the reason the forms jammed on the inserter was that they
were not properly protected for "required storage." Moreover,
there is nothing in the record to indicate that the forms failed
for reasons attributable to the Respondent and/or DFAS. See B&L
Construction Co., Inc., ENG BCA No. 5708, 91-2 BCA � 23,840, at
119,475 (citing Robert McMullin & Son, Inc., ASBCA No. 21455,
77-1 BCA � 12,456). Since the "PACKING" specification made the
Appellant responsible for packing the blank forms with their
preservation and storage in mind, and gave the Contractor full
discretion to choose whatever materials were appropriate to
achieve those ends, the product's failure to run on the Bell &
Howell inserter must be laid at its doorstep. See Bradley
Construction, Inc., ASBCA No. 39733, 91-2 BCA � 23,974; AGH
Industries, Inc., supra. Indeed, the Government had a right to
expect that the Appellant, who had produced these and similar
forms in the past, would use its expertise in packing them, and
to put it bluntly, the Contractor did not do so. In a sense,
this dispute is similar to the situation facing the ASBCA in
Service Engineering Co., where the contractor maintained that
stanchions and other supports not shown in the contract's
Guidance Plan constituted changed work. The contract, however,
made the contractor responsible for omitted details necessary to
fulfill the intent of the specification. The ASBCA found the
contractor responsible for the omitted stanchions and supports,
stating, in pertinent part:
SECO was an experienced contractor, having overhauled a number of
Navy vessels. [Finding omitted.] It had experienced estimators.
[Finding omitted.] We simply cannot accept the notion that SECO
could have been so naive as to believe that what was shown in the
Guidance Plans constituted the total scope of its work,
particularly in view of the above-cited specification provision.
See Service Engineering Co., ASBCA No. 40272, 92-3 BCA � 25,106,
at 125,183. See also Northwest Marine, Inc., ASBCA No. 43502,
94-1 BCA � 2,521, at 131,999 (". . . [W]e cannot conclude that a
contractor as experienced as appellant was misled into believing
it was not responsible for foundation materials, particularly in
light of the several bid, contract, and Master Agreement
statements . . . making appellant responsible for all but
Government-furnished materials."). Therefore, under these
circumstances, it cannot be said that the Respondent breached its
implied warranty that its specifications were adequate, id., at
131,998 (citing Natus Corp. v. United States, 371 F.2d 450, 458
(Ct. Cl. 1967), or that the Contractor "suitably" packed the
blank forms-the product's failure to run properly on the Bell &
Howell inserter is proof enough of that fact, see Fairfield
Machine Co., Inc., supra, 85-2 BCA at 90,085. Under the
"PACKING" specification's supplemental provisions, as well as the
"Warranty" clause, the Contracting Officer was expressly
authorized to direct the Appellant to correct the problem at its
own expense. See GPO Contract Terms, Supplemental
Specifications, � 2; Contract Clauses, �� 15(a)(1)(ii(b))(2), (b)
(2)(i). Accordingly, the Appellant is not entitled to an
equitable adjustment for performing the necessary additional
work. See Northwest Marine, Inc., supra; Service Engineering
Co., supra; Bradley Construction, Inc., supra. Rather, liability
for the cost of bringing the forms into conformance with the
requirements of this fixed-price contract is the Contractor's
alone. See New South Press, supra; Web Business Forms, Inc.,
supra. Accord B&L Construction Co., Inc., supra; Kilgore Corp.,
supra; DK's Precision Machining and Manufacturing, supra; Chevron
U.S.A., Inc., supra.
B. The Purchase Order's "PAPER" specification allowed the
Appellant to use 20 pound stock for the blank forms. Therefore,
the JCP O-61 standards for smoothness are inapplicable, and the
determination that the paper was nonconforming is without
contractual support. Furthermore, and the doctrine of "implied
warranty of specifications" shifted the risk of any performance
problems which might have been due to the roughness of the paper
to the Respondent. Moreover, under the agreement's "Warranty"
clause, the Contracting Officer had the option of directing the
Appellant to correct the performance problem with the paper, or
taking a discount in the contract price, but he could not do
both. Accordingly, there is no legal basis for imposing a 5%
reduction in the contract price under the circumstances of this
case.
Although the Respondent has prevailed on the "PACKING"
specification question, a different result is warranted on
the issue of whether it was entitled to take a 5% discount,
totalling $891.05, in the contract price on the ground that
the paper stock failed to meet JCP O-61 standards for
smoothness. See Res. Brf., at 6; RPTC, at 4. The Appellant
claims that its paper fully satisfied the contract's the
paper requirements, and besides the standards used to
disqualify its stock were formulated "out of whole cloth" in
the QCTD laboratory. See App. Brf., at 5-6; RPTC, at 4-5.
In the Board's view, the Contractor has the better argument.
There are two specifications in the contract relating to the
paper stock-one "design" and the other "performance." The
"design" specification sets forth four paper characteristics;
i.e., the stock must: (1) be white, high quality xerographic
copier, laser printer paper; (2) conform to JCP Code No. O-61;
(3) have a sheet size of 17" x 22"; and (4) have a basis weight
(500 sheets) of 20 or 24 pounds (R4 File, Tab B). Meanwhile, the
"performance" requirement says that the paper "must be suitable
for use on a Xerox 4050 or 4090 printer, and will process on a
Bell and Howell Mail Starr 500 or Pitney Bowes table top folder."
It is unclear whether the Respondent's position on the "discount"
issue makes a connection between the two, i.e., the roughness of
the paper caused the jamming problems on the Bell & Howell
inserter, or whether its 5% reduction in the contract price is
based solely on the technical inadequacy of the stock with
respect to smoothness, as determined by QCTD (R4 File, Tab D).
Stated otherwise, given the time which passed between delivery of
the forms and their use by the DFAS, the Board cannot tell from
this record whether the Government's claim relies on the "latent
defects' provision of the "Inspection and Tests" clause, see GPO
Contract Terms, Contract Clauses, � 14(k) ("Acceptance shall be
conclusive, except for latent defects . . ."), or the warranty
protections of the "Warranty" clause which override the
conclusiveness of acceptance, id., � 15(a)(1)(i)
("Notwithstanding inspection and acceptance by the Government of
supplies furnished or any condition concerning the conclusiveness
thereof, the contractor warrants that for 120 days from the date
of the check tendered as final payment-(i) All supplies furnished
will be free from defects in material or workmanship and will
conform to all requirements; . . .").37 However, in either case
GPO's discount claim cannot be sustained.
In the first place, it is undisputed that but for Respondent's
contention that the stock failed to measure up to the smoothness
standards of JCP O-61, the Appellant's paper conformed to every
other aspect of Purchase Order's "PAPER" specification; i.e., it
was correct as to color (white), kind (high quality xerographic
copier, laser printer paper), size (17" x 22"), and basis weight
(20 pounds). Furthermore, GPO cannot escape the legal
ramifications of its own test report which states that JCP O-61
specifications did not apply because they were written for 24
pound stock only, and thus the finding that Contractor's paper
was too rough was based on the analyst's estimation of "what 20
lb. O-61 might be" (R4 File, Tab D, QCTD Report). While the
Government alleges that the smoothness of paper is a quality
unaffected by its basis weight,38 the fact remains the stock in
this case was not measured against JCP O-61 specifications, as
written, but rather by some ad hoc standard formulated in the
laboratory for the express purpose of testing the 20 pound paper.
That "smoothness" is an important paper quality for printing
cannot be denied. See POCKET PAL: A Graphic Arts Production
Handbook, at 166 (14th ed. 1989) (POCKET PAL).39 So is
"runnability" for that matter. Id., at 164.40 However, there is
no indication in the record that the Appellant's paper failed to
run satisfactorily on either of the Xerox printers specified in
the contract, or even the Pitney Bowes table top folder, but
rather the jamming occurred afterwards when the forms were
processed through the Bell & Howell inserter. Furthermore, the
Respondent has not offered any evidence which would tend to show
that the roughness of the paper was responsible for the
runnability problems on that machine, while there is ample proof
in the record that the jamming was caused by the paper curling
either from ambient moisture or an extensive period of storage
without shrink-wrapping. See App. Exh. Nos. 1 and 3; Williams
Letter. Consequently, the GPO's insistence on stock which meets
the smoothness standards of JCP O-61 would appear to have no
better purpose than to simply enforce those paper specifications
for their own sake.
No one questions the Government's right to require complete or
perfect performance in its specifications. See Custom Printing
Co., Inc., supra, slip op. at 79; Professional Printing I,
supra, slip op. at 64; McDonald & Eudy Printers, Inc., supra,
slip op. at 19-20; Shepard Printing, supra, slip op. at 19-20;
Stephenson, Inc., supra, slip op. at 20-21; Copigraph, Inc., GPO
BCA 20-86 (May 25, 1989), slip op. at 2, 1989 WL 385174. Accord
Thermal Electronic, Inc. v. United States, 25 Cl. Ct. 671, 673
(1992). On the other hand, the law is also clear that before the
Government can reject a contractor's product, either as a prelude
to default or some lesser action, it must first establish
specific, quantifiable, objective, and firm criteria indicating
the level of quality which the product is expected to meet.41
See Custom Printing Co., Inc., supra, slip op. at 70;
Professional Printing I, supra, slip op. at 68 (citing Wornick
Family Foods Co., supra; Shirley Contracting Corp. and ATEC
Contracting Corp., ENGBCA No. 4650, 85-3 BCA � 18,214; John L.
Hall dba Taiga Resource Consultants, AGBCA No. 92-217-1, 93-3 BCA
� 26,212; Chandler-Wilbert Vault Co., VACAB No. 1444, 80-2 BCA �
14,682; Mid-American Engineering and Manufacturing, supra). See
also Elgin Business Forms, GPOCAB 10-84 (October 19, 1984), slip
op. at 5-8, 1984 WL 148108; Electronic Composition, Inc.,
(GPOCAB, December 22, 1978), slip op. at 34, 1978 WL 22339
(citing Elgin National Watch Co., ASBCA Nos. 10421, 10589, 10698,
10730, 11721, 67-2 BCA � 6400; ITT Arctic Services, Inc. v.
United States, supra).42 Usually, such standards are spelled out
in the parties' contract. However, where the contract fails to
establish acceptance criteria, the standard against which
contract work is measured is the standard customary within the
industry. See Total Reproductions, Inc., GPO BCA 16-88 (February
2, 1990), slip op. at 17, 1990 WL 454979. Accord WRB Corp. v.
United States, 183 Ct. Cl. 409, 445 (1968); Max J. Kuney Co.,DOT
BCA No. 2759, 94-3 BCA � 27,245, at 135,751; D.E.W., Inc., ASBCA
No. 37232, 93-1 BCA � 25,444, at 126, 712. The parties have
traveled this road before. In Professional Printing I, as in
this case, the Respondent rejected a shipment of forms because
they did not function properly on the customer-agency's
equipment. The forms in question were prescription forms
containing two main security features; i.e., sequential numbering
and a "Void" pantograph which was supposed to appear when the
form was reproduced on a copy machine. Although the Appellant
tested the copying quality of the first installment of forms
prior to shipment with satisfactory results, the customer-agency
(the U.S. Department of Veterans Affairs) complained that the
"Void" pantograph would not reproduce on its copiers. When GPO's
test of the forms also failed to produce the "Void" pantograph,
the Contracting Officer rejected the shipment and required the
Contractor to reprint to order with a changed "drop out" pattern.
After it had complied with the reprint request, the Appellant
filed an equitable adjustment claim, which the Contracting
Officer denied. However, the Board found that the Contractor was
entitled to extra compensation for two reasons: (a) the
operational failure stemmed from a defective Government design,
not any performance problem, and thus, the doctrine of "implied
warranty of specifications" applied, see Professional Printing I,
supra, slip op. at 62; and (b) the evaluation standards used by
the Contracting Officer in reaching his conclusion that the forms
were defective was not disclosed in the record-"a fatal defect,"
id., slip op. at 80-81. In the latter regard, the Board relied
heavily on the ad hoc panel's decision in Elgin Business Forms,
for its conclusion that in the absence of such testing or
measurement criteria in the specifications, elsewhere in the
contract, or in GPO's quality assurance regulations, the basis
for rejection could not be established.43 Id., slip op. at
71-73 (citing Elgin Business Forms supra, slip op. at 5-6).
Accord Wornick Family Foods Co., supra; Shirley Contracting Corp.
and ATEC Contracting Corp., supra; Chandler-Wilbert Vault Co.,
supra; Mid-American Engineering and Manufacturing, supra. See
also Custom Printing Co., supra, slip op. at 74-75; Electronic
Composition, supra, slip op. at 34.
As an analytical matter, the Board sees no distinction between
the parties' former dispute and this one. In the Board's
opinion, no logical difference exists between the total absence
of clear and objective evaluation standards in the previous case,
and the attempt to apply nonapplicable paper specifications in
this one. In each situation there is a measurement void, which
the Respondent tried to fill with an ad hoc solution based on the
subjective viewpoint of the Contracting Officer and/or the
Government inspector (usually both). However, as the prior
controversy makes clear, the Board has consistently required that
before GPO imposes its subjective judgment on otherwise
unsuspecting contractors, the specifications must alerted them to
the standards they will be expected to meet. See Custom Printing
Co., supra, slip op. at 79; Professional Printing I, supra, slip
op. at 75. See also RD Printing Associates, Inc., supra, slip
op. at 23-24. In this case, that simply means the Respondent
cannot unilaterally apply the JCP O-61 paper specification, or
any portion of it, to 20 pound stock, because that amounts to an
impermissible rewriting of the contract. See Unicom Systems,
Inc., supra, 84-3 BCA at 88,163.
Secondly, if GPO is contending that the roughness of the
Appellant's paper somehow caused the jamming problems on the
Bell & Howell inserter, then its argument is undermined by the
contract specifications themselves. In that regard, the Purchase
Order's "PAPER" specification gave the Appellant the option of
using either 20 or 24 pound stock (R4 File, Tab B). The
Appellant selected 20 pound paper for the forms, and thus
satisfied the specification to that extent (R4 File, Tab D). The
contract also said that whichever basis weight was used, the
paper had to satisfy JCP O-61 standards ("PAPER" specification),
and run on certain specified machinery, including the Bell &
Howell inserter ("DESCRIPTION NOTE"). However, as indicated
above, that the JCP O-61 paper specifications do not apply to 20
pound stock, and, of course, the paper did not operate on the
Bell & Howell equipment. Consequently, the issue boils down to
whether the risk of nonperformance can be shifted to the
Government even where, as here, a performance specification
("DESCRIPTION NOTE") is involved? Applying accepted principles
of law to the facts in this case, the answer to that question is
"Yes."
It is well-settled that the "implied warranty of specifications"
extends to all contract alternatives as a "special application"
thereof. See Bart Associates, Inc., supra, 96-2 BCA at
142,235-4; Wornick Family Foods Co., supra, 94-2 BCA at 133,339.
See generally, John Cibinic, Jr. & Ralph C. Nash, Jr.,
Administration of Government Contracts 283-84 (3d ed. 1995) (and
cases cited therein) (hereinafter Cibinic & Nash). The rule is
that when the Government provides for two alternative methods of
performance, a contractor has a right to assume that either
method is feasible, and that either method will achieve the
desired result without further investigation into its
acceptability, regardless of whether a "design" or "performance"
specification is involved. See Bart Associates, Inc., supra,
96-2 BCA at 142,235-4 (citing Neal & Co., Inc. v. United States,
supra; Harrison Wester/Franki-Denys, Inc., ENGBCA No. 5523, 92-1
BCA � 24,582; S & M-Traylor Brothers, ENGBCA No. 3852, 78-2 BCA �
13,495; Southern Paving Corp., AGBCA No. 74-103, 77-2 BCA �
12,813; Detweiler Brothers, Inc., ASBCA No. 17897, 74-2 BCA �
10,858). See generally Cibinic & Nash, at 283. Thus, in a
recent case, the Department of Energy Board of Contract Appeals
(EBCA) decided that a power line contractor who was allowed to
choose between polymer and porcelain insulators was not liable
for using polymer insulators which subsequently failed, and
dismissed the agency's argument that the performance-nature of
the specifications allocated the risk of failure to the
contractor, with the following reasoning:
In the Board's view, however, determination of the issue before
us rests on broader considerations than the narrow focus of
Appellant and Respondent, on the nature of the specifications.
Thus, whether design, performance, or mixed is neither conclusive
nor determinative. [Footnote omitted.] Instead, . . . the extent
of any Government implied warranty does not turn alone in some
purely mechanical fashion on whether various elements that may
characterize a specification as design, performance, or mixed are
present or absent.
Specifications do not stand alone but must be considered in the
context of all the accompanying circumstances. Johnson
Electronics, Inc., 65-1 BCA � 4628 (ASBCA 1964), at 22,106;
Whittaker Corporation, [Power Sources Division, 79-1 BCA � 13,805
(ASBCA), at 67,696.] . . .
Accordingly, the particular facts of a case govern whether
reliance on specification-type alone and the absence or presence
of various details therein are appropriate as a risk allocation
device. The surrounding circumstances here must be considered to
see if the parties start on an equal footing or if, by reason of
such circumstances, the risk has been shifted, making the author
of the specifications the "root cause" of problems that Bart
could not reasonably foresee. See Greenbriar Indus., Inc., 81-1
BCA � 14,982, at 74,135 (ASBCA) recons. denied, 81-1 BCA �
15,057.
See Bart Associates, Inc., supra, 96-2 BCA at 142,235-3. The
EBCA added that:
By offering equivalent alternative methods of performance, any
distinction in assumption of risk between design and performance-
type specifications was subsumed, and Respondent changed the risk
factor in favor of the Appellant. Cf., Johnson Electronics,
supra. Even if the specifications were performance type, the
assumption of risk that Respondent sought to impose upon
Appellant thereby no longer applied. See S & M-Traylor Bros., at
66,054. Thus, even if as Respondent contends, Division 6 of the
specifications set forth operational characteristics, objectives
and standards to be met, they were adequate for porcelain
insulation and inadequate for polymer insulators. Respondent is
hoist on its own petard.
Id., at 142,235-4.44 See also S & M-Traylor Brothers, supra,
78-2 BCA at 66,054 ("[The "assumption of risk" doctrine] has no
place in the case of an owner-generated design, where the
contractor's only discretion is to choose between two specified
procedures. Nor do we agree that a clause which, on its face,
appears to enlarge the contractor's range of alternatives, can be
construed as a warning that the specified alternative may be
infeasible. The rule is exactly the opposite; by providing two
methods of performance the contract implies that either will
achieve the desired result."). See generally Cibinic & Nash, at
283-84.
In the Board's view, the EBCA's statement of the law in Bart
Associates, Inc., is equally applicable to this case. Thus, even
though the Purchase Order's "DESCRIPTION NOTE" is technically a
performance specification, because the "PAPER" requirement
allowed a choice between 20 or 24 pound stock, the Appellant
could assume, without further investigation, that usable blank
forms would result from the lesser weight paper. Furthermore,
the legal effect of providing for equivalent alternative methods
of performance in the contract was to eliminate the normal risks
which the Contractor would have shouldered under a performance-
type specification, and shift that burden to the Respondent.
Therefore, the Appellant is entitled to the benefit of the
"implied warranty of specifications" on the paper issue. See
Bart Associates, Inc., supra, 96-2 BCA at 142,235-4; Wornick
Family Foods Co., supra, 94-2 BCA at 133,339; S & M-Traylor
Brothers, supra, 78-2 BCA at 66,054.
Finally, given the fact that nearly four months passed between
delivery of the forms to DFAS and their ultimate use by the
customer-agency, it is clear that the Contracting Officer handled
the jamming problem as a warranty matter.45 The "Warranty"
clause provides the Government with two possible remedies for
contractor breaches of warranty-directing the contractor to
correct or replace the defective supplies, or retaining the
supplies at an appropriate discount in the contract price. See
GPO Contract Terms, Contract Clauses, �� 15(b)(2)(i), (ii). The
plain meaning of the remedy provision, which is expressed in the
disjunctive, is that a Contracting Officer may do one or the
other, but not both. However, in this case the Contracting
Officer invoked both remedies-he ordered the Appellant to fix the
jamming problem at its own expense, and he reduced the contract
price by 5% "[a]s compensation for accepting the defective
product," as determined by the QCTD Report (R4 File, Tab F). The
Board has already stated its reasons for rejecting the test
results in the QCTD Report as the basis for finding that the 20
pound stock used by the Appellant failed to meet JCP O-61 paper
standards. Furthermore, the simple answer to the Respondent's
contention that its 5% discount tracks the guidelines in QATAP,
see R4 File, Tab F; Boortz Declaration, � 8, and indeed, could
have been even larger under that regulation, see Res. Brf., at 6,
n. 1, is that QATAP is not part of this contract; i.e., as the
Board has pointed out above, the QATAP box on the Purchase Order
is not checked. In the Board's view, once the Contracting
Officer allowed the forms to be shrink-wrapped, which the parties
agree corrected the jamming problem, he effectively made an
election of remedy under the "Warranty" clause, and foreclosed
the Government's right to take a discount as the price for
accepting the product. Imposition of a 5% discount under these
circumstances amount to contractual "double jeopardy."46
Accordingly, reducing the contract price in this case was an
erroreous act, and the Respondent owes the Contractor a $891.05
refund.
ORDER
Considering the record as a whole, the Board finds and concludes
that: (1) under the relevant provisions of the "PACKING"
specification, as supplemented by GPO Contract Terms, "suitable"
packing encompassed "transportation," "preservation" and
"required storage;" (2) the pertinent parts of the specification
are clearly performance in nature, making the Appellant totally
responsible for accomplishing the contractual objectives; and (3)
thus, the Contractor is not entitled to an equitable adjustment
for its post-delivery shrink-wrapping of the forms in this case.
THEREFORE, and the Contracting Officer's final decision rejecting
its claim in the amount of $5,661.59 is hereby AFFIRMED, and that
portion of the appeal is DENIED.
FURTHERMORE, the Board also finds and concludes that: (1) because
the "PAPER" specification authorized the use of 20 pound stock
for the blank forms, JCP O-61 is inapplicable, and there are no
standards in the agreement for determining that the paper was
nonconforming; (2) the contractual option which allowed the
Contractor to select either 20 or 24 pound paper also shifted the
risk of any performance problems because of roughness to the
Respondent under the doctrine of "implied warranty of
specifications;" (3) the "Warranty" clause gave the Contracting
Officer the right to either direct the Appellant to correct the
performance problem with the paper, or take a discount in the
contract price, but he could not do both; and (4) thus, the
Government's 5% reduction in the contract price has no legal
basis. ACCORDINGLY, to this extent the Contracting Officer's
final decision is REVERSED, the appeal is ALLOWED, and the
Respondent is directed to refund $891.05 to the Contractor.
It is so Ordered.
September 16, 1997 STUART M. FOSS
Administrative Judge
_______________
1 With the Appellant's Notice of Appeal was another document
entitled "Election to Proceed Under Small Claims Procedure." The
Small Claims (Expedited) Procedure requires a Board decision,
wherever possible, within 120 days after the Board receives
written notice of the appellant's election. See GPO Instruction
110.12, Subject: Board of Contract Appeals Rules of Practice and
Procedure, dated September 17, 1984, Rule 12.1(a) (Board Rules).
However, during the conference, the Appellant withdrew its
request for processing the appeal as a small claims matter. See
Report of Prehearing Telephone Conference, dated May 6, 1994, at
2, n. 1 (hereinafter RPTC).
2 The Contracting Officer's appeal file was assembled pursuant to
Rule 4 of the Board's Rules of Practice and Procedure, and
delivered to the Board on November 8, 1993. See Board Rules,
Rule 4(a). It will be referred to hereafter as the R4 File, with
an appropriate tab letter also indicated. The R4 File contains
six (6) documents, identified as Tabs A-F. Furthermore, based on
the discussions at the prehearing conference held on April 26,
1994, the Board asked the parties to supply certain additional
information. See RPTC, at 6-7. Thereafter, by letter dated May
24, 1994, the Appellant sent the following documents to the
Board: (a) Counsel for the Appellant's file notes (hereinafter
App. Exh. No. 1); (b) a copy of Counsel's letter to Steve Boortz,
the DRPPO's Compliance Officer, dated July 12, 1993, including
the Appellant's itemized costs for repacking the forms
(hereinafter App. Exh. No. 2) (same as R4 File, Tab E); (c) a
copy of Counsel's letter to Boortz, dated June 16, 1993
(hereinafter App. Exh. No. 3); (d) a copy of a letter from the
Appellant to its Counsel, dated June 29, 1993, and signed by Jan
W. Gallagher (hereinafter App. Exh. No. 4); and (e) a verified
transcription of Gallagher's file notes concerning his telephone
conversation with Boortz on April 6, 1993 (hereinafter App. Exh.
No. 5). As for the Respondent, by Notice of Filing, dated May
23, 1994, GPO furnished the Board with: (a) a declaration from
Contracting Officer Macdonald (hereinafter Macdonald
Declaration); (b) a declaration from Compliance Officer Boortz
(Boortz Declaration); and (c) a letter, dated May 20, 1994, from
Wanda Williams, Chief, Administration Services Branch,
Directorate of Support Services at the customer-agency, to
Contracting Officer Macdonald (hereinafter Williams Letter).
Subsequently, with their briefs both parties submitted further
documentation: (a) the Appellant provided a copy of Jacket No.
675-993, Purchase Order M-7447, dated August 4, 1992 (hereinafter
App. Exh. No. 6); and (b) the Respondent furnished a declaration
from Sylvia S. Y. Subt, Chief, Paper and Physical Testing
Division, Quality Control and Technical Department at GPO
(hereinafter Subt Declaration).
3 When the contract was awarded, the name of the Appellant was
"Professional Printing Center." See R4 File, Tab B. However,
its name was changed to "Professional Printing of Kansas, Inc."
by the time of the appeal. See R4 File, Tab A. In such cases,
GPO's printing procurement regulation requires that the parties
execute a simple change of name agreement. See Printing
Procurement Regulation, GPO Publication 305.3 (Rev. 10-90), Chap.
XII, Sec. 3, � 3 (PPR). The Board assumes that such an agreement
is on file with the DRPPO. In any event, the Board's
jurisdiction is certain because, despite the name change, there
is no doubt but that the appeal was filed by the same entity with
which the Government had contracted. See Plum Run, Inc. d/b/a
Plum Run Corp., ASBCA Nos. 46091, 49203, 49207, 97-1 BCA �
28,770; Adelaide Blomfield Management Co., GSBCA No. 13125, 95-2
BCA � 27,865.
4 Whether or not the Contractor had produced the previous order
of such forms is disputed in the record. Compare Williams Letter
(a different contractor) with R4 File, Tab C (Memorandum from Jo
Ann Schitzer, Chief, Contractual Services Section, Directorate of
Support Services (DFAS), to John Louie, Printing Specialist,
Defense Printing Service, Detachment Branch Office, Denver (March
1993 date illegible) (Schitzer Memorandum), and App. Exh. No. 6.
In the Board's judgment, however, it is unnecessary to resolve
that question in this decision. First, the two agreements are
sufficiently different with respect to their paper and packing
specifications so that the previous contract is irrelevant to the
issues in this case; e.g., the previous contract does not contain
a note requiring the paper ordered to run on any particular brand
name equipment. See notes 6 and 7 infra. Besides, the parties'
"prior course of dealings" is not involved in this appeal. Cf.
Custom Printing Co., GPO BCA 28-94 (March 12, 1997), slip op. at
49-51, 1997 WL _____; Swanson Printing Co., GPO BCA 27-94 and
27A-94 (November 18, 1996), slip op. at 29-30, 1996 GPO LEXIS 38;
Olympic Graphic Systems, GPO BCA 1-92 (September 13, 1996), slip
op. at 32, 1996 WL 812957; MPE Business Forms, Inc., GPO BCA
10-95 (August 16, 1996), slip op. at 59, 1996 GPOBCA LEXIS 31;
Publishers Choice Book Manufacturing Co., GPO BCA 4-84 (August
18, 1986), slip op. at 10-11, 1986 WL 181457.
5 See GPO Contract Terms, Solicitation Provisions, Supplemental
Specifications, and Contract Clauses, GPO Publication 310.2,
Effective December 1, 1987 (Rev. 9-88) (GPO Contract Terms).
6 This paper specification was a change from the previous order
for these blank forms. In that regard, Jacket No. 675-993,
Purchase Order M-7447, signed by Contracting Officer Macdonald,
and issued on August 4, 1992, provides: "PAPER-COLOR AND KIND:
White writing. JCP Code No.: D-10. Basis-500 sheets: 17" X 22"
(size) and 20 pounds." See App. Exh. No. 6.
7 The following five check boxes under "Packing" were left blank:
(a) "Wrap;" (b) "Shrink Film Pack;" (c) "Box; (d) "Suitable;" and
(e) "in units of ___." See R4 File, Tab B. By contrast, the
previous contract, while also specifying "suitable" packing per
shipping container and requiring pallets, additionally provides
"Shrink Film Pack . . . in units of 500." See App. Exh. Nos. 4
and 6.
8 GPO Contract Terms, Quality Assurance Through Attributes
Program for Printing and Binding, GPO Publication 310.1,
Effective May 1979 (Revised November 1989).
9 The DPS contacted the DRPPO because of a complaint by the DFAS
(R4 File, Tab C, Schitzer Memorandum). In that regard, the
customer-agency told the DPS that because it had experienced
major running problems with the last batch of paper from the
previous order, it had asked Bell & Howell to test the stock.
Bell & Howell's report indicated that the paper had a basis
weight of 18 pounds, which would have made it nonconforming (R4
File, Tab D, Bell & Howell Internal Memorandum, dated March 12,
1993 (Bell & Howell Memorandum). See also R4 File, Tab C
(Memorandum from John Louie, Printing Specialist, Defense
Printing Service, Detachment Branch Officer, Denver to Manger,
DRPPO, dated March 29, 1993). Since the DFAS believed that the
new paper had been supplied by the same contractor-the Appellan-
it asked the DPS to have the paper retested to ensure that it was
20 pounds (R4 File, Tab C, Schitzer Memorandum). It should be
noted that Bell & Howell also found the paper substandard with
respect to porosity and stiffness, and suggested that 20 pound
paper would eliminate those defects (R4 File, Tab D, Bell &
Howell Memorandum).
10 It is obvious that the initials "FGA" in App. Exh. No. 5 stand
for "Frederic (Fred) G. Antoun."
11 There is no explanation in the record for the 2 pound weight
difference between the Government's tests and Bell & Howell's.
See note 9 supra. On the other hand, the weight of the paper per
se was not the problem according to GPO's inspectors, instead
porosity and thickness or stiffness (or rather the lack of those
qualities) was (R4 File, Tab D). See also Subt Declaration, � 4
("As the basis weight of paper increases and decreases, it has a
direct effect on some technical qualities such as thickness and
stiffness. However, the slight difference between 20 lb. and 24
lb. basis weight would have no effect on other qualities such as
porosity and smoothness."). Furthermore, the record indicates
that porosity and smoothness are paper characteristics which are
not dependent on the weight of the stock. Id., � 4. Thus, even
if a contract requires paper that meets JCP O-61 standards, as
here, the stock should be as smooth at 20 pounds as at 24 pounds.
Id., � 5.
12 According to Boortz, the Appellant was asked to "suggest an
appropriate equitable price reduction" for the Government's
acceptance of its nonconforming product. See Boortz Declaration,
� 7.
13 The breakdown of the Contractor's claim is as follows: (a) for
the April 28, 1993, first "test" repack (148,000 sheets),
Labor-$262.12; Materials-$48.10; Freight-$614.16, for a total of
$924.38; and (b) for the June 30, 1993, second repack (1,440,000
sheets), Labor-$2,579.41; Materials-$457.80; Freight-$1,700.00,
for a total of $4,737.21, giving a grand total of $5,661.59. See
R4 File, Tab E; App. Exh. No. 2.
14 See note 7 supra.
15 Apart from the merits of the claim, the final decision letter
also addressed a procedural matter raised by the Appellant,
namely whether GPO had waived its right to insist on correction
of the paper problem at no cost to the Government by waiting too
long to use the forms; i.e., whether the warranty period had
expired? See App. Exh. No. 5. In that regard, the contract's
"Warranty" clause establishes a 120-day warranty period beginning
from the date the final payment check is tendered. See GPO
Contract Terms, Contract Clauses, � 15(a). As mentioned
previously, the Contractor delivered the forms, as required, on
December 1, 1992 (R4 File, Tab B). There is nothing in the
record to indicate either when the Appellant submitted its
payment voucher or when the Respondent paid it. However, it is
safe to say, based on the Board's experience in other cases, that
DPS' complaint of March 29, 1993 (R4 File, Tab C), and the
DRPPO's call to the Contractor regarding that complaint on April
6, 1993 (App. No. 5), occurred within the contract warranty
period. Indeed, even if the Respondent had tendered final
payment the day after delivery-a highly unlikely scenario-the
warranty period would have lasted until March 31, 1993. The
Appellant has not challenged the Contracting Officer's finding
that the Government timely asserted its rights under the
"Warranty" clause, and this record provides the Board with no
reason to find otherwise.
16 At the prehearing conference on April 26, 1994, the Board
identified the following three issues: (a) did the blank forms
supplied by the Appellant conform in all respects to the contract
specifications, and if not, was the 5[%] price reduction imposed
by the Contracting Officer an appropriate exercise of his
discretion; (b) was the "Packing" clause ambiguous, or, stated
otherwise, should the Contractor have reasonably assumed that
shrink wrapping was included in the instruction to "pack suitable
per shipping container," even though the "Shrink Film Pack" box
was not checked; and (c) is the Appellant entitled to additional
compensation for repacking the blank forms with shrink wrap,
either as a "constructive change" or under the theory of quantum
meruit, and if so, what should be the amount of equitable relief?
See RPTC, at 6. Those questions are subsumed in the two issues
set forth above.
17 The Appellant also points to a prior contract-Purchase Order
M-7447, Jacket No. 675-993-in which GPO ordered the forms shrink-
wrapped by checking the appropriate boxes, as proof that the
Government's failure to do so in this case meant that shrink-
wrapping was not required here. See App. Brf., at 4 (citing App.
Exh. No. 6) . However, the Board has already indicated that the
previous agreement is irrelevant to this dispute. See note 4
supra.
18 The Contractor also alleges that some unidentified employee of
the DRPPO has said that "all future requisitions of this order
will require shrink-wrapping," as evidence that the Government
knows it made a drafting error. See App. Brf., at 4. Such a
statement is clearly hearsay, which is defined as "a statement
made by the out-of-court declarant which is offered into evidence
to prove the truth of the matter asserted." See Asa L. Shipman's
Sons, Ltd., GPO BCA 06-95 (August 29, 1995), slip op. at 12, n.
16, 1995 WL 818784 (citing Taylor Air Systems, Inc., ASBCA No.
25526, 84-1 BCA � 17,141, at 85,396; FED. R. EVID. 801),
reconsid. denied, 1996 WL _____ (February 13, 1996). Generally,
credible hearsay is admissible in administrative proceedings,
including those of the Board. See Vanier Graphics, GPO BCA 12-92
(May 17, 1994), slip op. at 36, n. 29, 1994 WL 275102 (hearsay
evidence is admissible in administrative proceedings provided it
is relevant and material, and otherwise reliable, adequate,
probative, and fundamentally fair. [Citations omitted.]). Accord
Southwest Marine, Inc., DOTBCA No. 161, 93-3 BCA � 226,168; Rocky
Mountain Trading Co., GSBCA No. 8671-P, 87-1 BCA � 19,406;
Johnson & Son Erector Co., ASBCA No. 23689, 86-2 BCA � 18,931;
Hof Construction, Inc., GSBCA No. 7012, 84-1 BCA � 17,009.
However, setting aside the fact that the employee who spoke is
unknown, the statement is the "rankest sort of hearsay," more in
the nature of a prediction or speculation, and therefore,
entitled to no credence whatsoever. See Asa L. Shipman's Sons,
Ltd., supra, slip op. at 12, n. 16 (citing Amdahl Corp. v.
Department of Health and Human Services, GSBCA No. 11998-P, 93-2
BCA � 25,612, at 127,488).
19 During the prehearing conference, Antoun stated his belief
that the "PACKING" specification was left ambiguous on purpose,
because the precise type of "suitable"packing depended upon
several unknown factors, including whether the blank forms were
to be used immediately, or were to be kept in storage for an
indefinite time, perhaps even beyond the 120-day warranty period.
See RPTC, at 5. The thrust of his contention was that the DRPPO
intentionally used fuzzy language as an "insurance policy" just
in case extended storage of the paper caused changes affecting
its running properties. Antoun's claim is not only pure
speculation, but his assertion is tantamount to an accusation
that the Government was guilty of bad faith in drafting its
specifications. See Hurt's Printing Co., Inc., GPO BCA 27-92
(January 21, 1994), slip op. at 11, n. 15, 1994 WL 275098
(allegation that the Government purposely wrote the
specifications to give the previous contractor unfair advantage
in the bidding process). As the Board has said on numerous
occasions, an allegation of bad faith must be established by
"well-nigh irrefragable proof" because there is a strong
presumption that Government officials properly and honestly carry
out their functions. See e.g., Rose Printing, Inc., GPO BCA
32-95 (December 16, 1996) slip op. at 25, 1996 GPOBCA LEXIS 34;
Big Red Enterprises, GPO BCA 07-93 (August 10, 1996), slip op. at
36-37, 1996 GPOBCA LEXIS 26; MPE Business Forms, Inc., supra,
slip op. at 27-28, n. 34; New South Press & Assoc., Inc., GPO BCA
14-92 (January 31, 1996), slip op. at 36, 1996 WL 112555; Asa L.
Shipman's Sons, Ltd., supra, slip op. at 12, n. 16; Universal
Printing Co., GPO BCA 9-90 (June 22, 1994), slip op. at 24, n.
24, 1994 WL 377586; Hurt's Printing Co., Inc., supra, slip op. at
11, n. 15; B. P. Printing and Office Supplies, GPO BCA 14-91
(August 10, 1992), slip op. at 16, 1992 WL 382917; Stephenson,
Inc., GPO BCA 2-88 (December 20, 1991), slip op. at 54, 1991 WL
439274; The Standard Register Co., GPO BCA 4-86 (October 28,
1987), slip op. at 12-13, 1987 WL 228972. Accord Claude R. Smith
v. United States, 34 Fed. Cl. 313, 321-22 (1995); Brill Brothers,
Inc., ASBCA No. 42573, 94-1 BCA � 26,352; Karpak Data and Design,
IBCA No. 2944, 93-1 BCA � 25,360; Local Contractors, Inc., ASBCA
No. 37108, 92-1 BCA � 24,491. "Irrefragable" proof simply means
evidence which is incapable of being refuted; i.e., indisputable
evidence. See Rose Printing, Inc., supra, slip op. at 25, n. 26;
Stephenson, Inc., supra, slip op. at 54 (citing WEBSTER'S NEW
WORLD DICTIONARY 714 (3d coll. ed. 1988)). The key to such
evidence is a showing of specific intent on the part of the
Government to injure the contractor. See Rose Printing, Inc.,
supra, slip op. at 26; Big Red Enterprises, supra, slip op. at
37; MPE Business Forms, Inc., supra, slip op. at 27-28, n. 34;
New South Press & Assoc., Inc., supra, slip op. at 36, n. 52;
Stephenson, Inc., supra, slip op. at 54. Accord Claude R. Smith
v. United States, supra, 34 Fed. Cl. at 322; Kalvar Corp. v.
United States, 211 Ct. Cl. 192, 199, 543 F.2d 1298, 1302 (1976),
cert. denied, 434 U.S. 830, 98 S.Ct. 112, 54 L.Ed.2d. 89. In the
Board's view, no such "irrefragable proof" of the Respondent's
bad faith exists in this record. Certainly, there is absolutely
no evidence which would show that GPO by itself, or in concert
with the DFAS, specifically set out to harm the Appellant. See
e.g., Rose Printing, Inc., supra, slip op. at 26; Big Red
Enterprises, supra, slip op. at 37; Asa L. Shipman's Sons, Ltd.,
supra, slip op. at 12, n. 16; Hurt's Printing Co., Inc., supra,
slip op. at 11, n. 15; Stephenson, Inc., supra, slip op. at 57.
20 The Appellant notes that nothing in the record indicates that
the forms were defective when delivered, but rather the evidence
shows that the product shipped to the DFAS only failed to run on
the Bell & Howell inserter after it had been stored for four
months. See App. Brf., at 4. However, it is also true that DFAS
made no attempt to use the forms in question when the order was
delivered, because it was still using forms from the previous
order (R4 File, Tab C, Schitzer Memorandum). Indeed, the trigger
for this dispute was the failure of the last batch of forms from
the previous order to work on the Bell & Howell equipment, which
prompted the customer agency's request to have the forms in
question tested to ensure that the paper was the correct weight.
Id.
21 The Respondent notes that a major purpose of this rule is to
ensure that the integrity of the bidding system will not be
compromised. See Respondent's Brief, dated June 22, 1994, at 3
(citing Ideal Restaurant Supply Co., VACAB No. 570, 67-1 BCA �
6237) (Res. Brf.).
22 See also Macdonald Declaration, � 7 ("From the Government's
standpoint, the cause of the problem is immaterial, as it is the
contractor's obligations to provide a product which will run on
the equipment specified in the contract.").
23 GPO notes that it could have taken a maximum reduction of
23.4% under QATAP. See Res. Brf., at 6, n.1.
24 Accordingly to the Government, the smoothness requirements for
JCP O-61 paper is 100 units. The Appellant's paper had an
average smoothness of 137.5 units. See Res. Brf., at 6.
25 The forms in dispute, which were to be shipped in two
installments, were prescription forms containing two main
security features; i.e., sequential numbering and a "Void"
pantograph which was supposed to appear when the form was
reproduced on a copy machine. Although the contractor tested the
copying quality of the first installment of forms prior to
shipment with satisfactory results, the customer-agency
complained that the "Void" pantograph would not reproduce on its
copiers. When GPO's test of the forms also failed to produce the
"Void" pantograph, the contracting officer rejected the shipment
and required the contractor to reprint to order with a changed
"drop out" pattern. After it had complied with the reprint
request, the contractor sought an equitable adjustment for the
first shipment.
26 It should be noted that one way in which this appeal differs
from the parties' former dispute is that here the contract
specified the types of equipment which the forms were to be used
on, while in the other case GPO had failed to identify which
brands of photocopiers would be used to reproduce the forms in
question. See Professional Printing I, supra, slip op. at 75.
27 In effect, the doctrine of "implied warranty of
specifications" modifies two other black letter principles. The
first, which the Respondent relies on, is that the Government is
entitled to strict compliance with its specifications. See e.g.,
Sterling Printing, Inc., GPO BCA 20-89 (March 28, 1994), slip op.
at 26, 1994 WL 275104, reconsid. denied, 1994 WL 377592 (July 5,
1994); Shepard Printing, GPO BCA 23-92 (April 29, 1993), slip op.
at 19, 1993 WL 526848; International Lithographing, supra, slip
op. at 20; Rose Printing Co., supra, slip op. at 6; Fry
Communications, Inc., supra, slip op. at 5; Mid-America Business
Forms Corp., supra, slip op. at 18; Dependable Printing Co.,
Inc., supra, slip op. at 23-24. See also Mega Construction Co.,
Inc. v. United States, 25 Cl. Ct. 735, 741; Wholesale Tire and
Supply Co., Ltd., ASBCA No. 42502, 92-2 BCA � 24,960. The second
is that a contractor who enters a firm fixed-price contract with
the Government, bears the risk of increased performance costs,
absent facts or a clause allowing otherwise. See e.g., New South
Press, GPO BCA 45-92 (November 4, 1994), slip op. at 14, 1994 WL
837425; Web Business Forms, Inc., GPO BCA 16-89 (September 30,
1994), slip op. at 23, 1994 WL 837423. Accord Kilgore Corp.,
ASBCA No. 31899, 90-3 BCA � 23,226, at 116,560-61; DK's Precision
Machining and Manufacturing, ASBCA No. 39616, 90-2 BCA � 22,830;
Chevron U.S.A., Inc., ASBCA No. 32323, 90-1 BCA � 22,602; Nedlog
Co., ASBCA No. 26034, 82-1 BCA � 15,519. It should be noted that
at one time the "strict compliance" rule was considered absolute
in supply contracts. See Cherry Meat Packers, Inc., supra;
Melrose Packaging Corp., ASBCA No. 9045, 1963 BCA � 3769).
However, in 1966 the Court of Claims created a limited exception
to this principle for situations where a contractor timely
shipped nonconforming goods which deviated from the
specifications in only minor respects. The so-called
"substantial compliance" rule affords defaulting contractors a
reasonable opportunity to correct minor defects in shipments to
the Government. See Radiation Technology, Inc. v. United States,
177 Ct. Cl. 227, 366 F.2d 1003, 1005-06 (1966). The Radiation
Technology doctrine is clearly an encroachment on the
Government's right to terminate. However, it is also apparent
that the rule merely stays that right for a reasonable period,
and does not affect the Government's right to insist on totally
conforming goods; i.e., the doctrine concerns time, not the
supplies themselves. See Shepard Printing, supra, slip op. at
20, n. 25; Stephenson, Inc., supra, slip op. at 50-51, n. 54.
28 The Board has also observed that specifications serve the
purpose of eliciting and defining the essential qualities
necessary in the procured product, and that the Government has a
right to get exactly what it asked for in the solicitation. See
Automated Datatron, Inc., GPO BCA 25-87 and 26-87 (April 12,
1989), slip op. at 3, 1989 WL 384974 (citing Nichols & Co. v.
United States, 156 Ct. Cl. 358 (1962), cert. denied, 371 U.S. 959
(1963); Rohr Industries, Inc., ENG BCA No. 4058, 82-1 BCA �
15,732).
29 By contrast, where the Government insists on strict
enforcement of the specifications, it must prove that the product
does not meet the requirements of the contract; i.e., it bears
the initial "burden of persuasion" of showing that the rejected
work does, in fact, deviate from the specifications. See Custom
Printing Co., supra, slip op. 72, n. 63; Professional Printing I,
supra, slip op. at 64; McDonald & Eudy Printers, Inc., GPO BCA
06-91 (May 6, 1994), slip op. at 23-24, 1994 WL 377581;
International Lithographing, supra, slip op. at 20; Stabbe Senter
Press, GPO BCA 13-85 and 19-85 (May 12, 1989), slip op. at 49,
1989 WL 384977; Mid-America Business Forms Corp., supra, slip op.
at 18-19. Accord ABM/Ansley Business Materials, GSBCA No. 9367,
93-1 BCA � 25,246; Goal Chemical Sealants Corp., GSBCA Nos. 8627,
8628, 88-3 BCA � 21,083; Churchill Chemical Corp., GSBCA Nos.
4321, 4322, 4346, 4353, 77-1 BCA � 12,318, at 59,5000, aff'd,
Churchill Chemical Corp. v. United States, 221 Ct. Cl. 284, 602
F.2d 358 (1979); Ramar Co., ASBCA No. 16060, 72-2 BCA � 9644;
Pams Products, Inc., ASBCA No. 15847, 72-1 BCA � 9401; Hardeman-
Monier-Hutcherson, ASBCA No. 11785, 67-1 BCA � 6210. The
Government usually meets this burden by advising the contractor
of the results of the inspection it has conducted. See
Professional Printing I, supra, slip op. at 65; McDonald & Eudy
Printers, Inc., supra, slip op. at 24; Stabbe Senter Press,
supra, slip op. at 49. The burden then shifts to the contractor
to prove the Government's findings are invalid for one reason or
another. See Professional Printing I, supra, slip op. at 65;
McDonald & Eudy Printers, Inc., supra, slip op. at 24; Stabbe
Senter Press, supra, slip op. at 49; International Lithographing,
supra, slip op. at 21. Accord Nuclear Research Corp. v. United
States, 814 F.2d 647, 650 (Fed. Cir. 1987); Riverport Industries,
Inc., ASBCA Nos. 28089, 28090, 28091, 29577, 86-2 BCA � 18,835,
reconsid. den., 86-3 BCA � 19,050; Continental Chemical Corp.,,
GSBCA No. 4483, 76-2 BCA � 11,948; Shamrock Industrial
Maintenance, DOT CAB No. 72-11, 72-2 BCA � 9482; C.W. Roen
Construction Co., DOT CAB No. 75-43, 76-2 BCA � 12,215.
Otherwise, the presumption that the Government's tests are
conducted correctly will prevail. See Professional Printing I,
supra, slip op. at 66. Accord Astro Science Corp. v. United
States, 200 Ct. Cl. 354, 471 F.2d 624 (1973); Integrated Systems
Group, Inc., GSBCA No. 11602-P, 92-1 BCA � 24,762; Donald R.
Stewart & Associates, AGBCA Nos. 84-226-1, 84-227-1, 84-228-1,
84-239-1, 84-240-1, 84-241-1, 85-168-1, 89-222-1, 89-223-1,
89-224-1, 89-225-1, 92-1 BCA � 24,705; Goal Chemical Sealants
Corp., supra; Horn Waterproofing Corp., DOT CAB No. 73-24, 74-2
BCA � 10,933. On the other hand, if the contractor comes forward
with evidence that casts doubt on the Government's test results,
or somehow dilutes or neutralizes their impact, and the
Government presents no additional evidence in support of its
findings, then the so-called "validity" issue will be decided
against it. See Professional Printing I, supra, slip op. at
79-80 (citing Unlimited Supply Co., Inc., GSBCA No. 12371, 94-3
BCA � 27,170, at 135,393; Praoil, S.r.L., ASBCA Nos. 41499,
44369, 94-2 BCA � 26,840; Air-O-Plastik Corp., GSBCA 4802, 4870,
4925, 4965, 81-2 BCA � 15,338; Communications, Ltd., ASBCA Nos.
23261, 80-1 BCA � 14,368). Simply stated, the rule is: "[W]here
there is proof of differing tests results and no additional
evidence is presented, the issue of conformity with specification
must be decided against the party having the burden of proof."
See Praoil, S.r.L., supra, 94-2 BCA at 133,502 (citing Lisbon
Contractors v. United States, 828 F.2d 759, 764-65 (Fed. Cir.
1987); Universal Steel Strapping Co., ASBCA No. 13686, 69-2 BCA �
7799 at 36,212).
30 See note 19 supra.
31 The United States Claims Court has observed that: "[a] mere
dispute over the terms does not constitute an ambiguity, and an
interpretation which is merely possible is not necessarily
reasonable." See Ceccanti, Inc. v. United States, supra, 6 Cl.
Ct. at 528. An ambiguity must have two or more reasonable
interpretations and the intent of the parties must not be
determinable by the normal rules of interpretation. See McDonald
& Eudy Printers, Inc., GPO BCA 25-92 (April 11, 1994), slip op.
at 14, n. 12, 1994 WL 275093; R.C. Swanson Printing and
Typesetting Co., GPO BCA 31-90 (February 6, 1992), slip op. at
42, 1992 WL 487874, aff'd, Civil Action No. 92-128C (Cl. Ct.
October 2, 1992). See also International Business Investments,
Inc. v. United States, 17 Cl. Ct. 122 (1989), aff'd, 895 F.2d
1421 (Fed. Cir. 1990) (contract terms are not rendered ambiguous
by the mere fact that the parties disagree as to their meaning;
there must be reasonable uncertainty of meaning); Perry & Wallis,
Inc. v. United States, supra, 192 Ct. Cl. at 315, 427 F.2d at 725
(quoting Bishop Engineering Co. v. United States, 180 Ct. Cl.
411, 416 (1967)). Furthermore, a contractor claiming an
ambiguity in drafting does not have to prove its interpretation
is more reasonable than the Government-the test is whether or not
the contractor's interpretation standing alone is reasonable.
See George Bennett v. United States, 178 Ct. Cl. 61, 371 F.2d
859, 861 (1967) ("To prevail . . . it is not essential that [the
contractor] demonstrate his position to be the only justifiable
or reasonable one. a specification susceptible to more than one
interpretation, found to be consistent with the contract's
language and the parties' objectively ascertainable intentions
becomes convincing proof of an ambiguity; the burden of that
ambiguity falls solely upon the party who drew the
specification." Citing Peter Kiewit Sons' Co., 109 Ct. Cl. 390,
74 F.Supp. 165 (1947)).
32 The seven key rules are: (a) two different interpretations of
the same contract language raise the possibility that the
specifications may be ambiguous; (b) contractual language is
ambiguous if it will sustain more than one reasonable
interpretation; (c) the courts and contract appeals boards place
themselves in the shoes of a reasonably prudent contractor in
analyzing disputed contract language, and give the words that
meaning which a reasonably intelligent contractor acquainted with
the circumstances surrounding the contract would ascribe to them;
(d) a dispute over contract language is not resolved simply by a
determination that an ambiguity exists-it is also necessary to
decide whether the ambiguity is latent or patent; (e) a latent
ambiguity exists where the disputed language, without more,
admits of two different reasonable interpretations; (f) if the
ambiguity is latent, the doctrine of contra proferentem applies
and the disputed language will be construed against the drafter,
provided the non-drafter can show that he/she relied on the
alternative reasonable interpretation in submitting his/her bid;
(g) a patent ambiguity exists if the contract language contains a
gross discrepancy, an obvious error in drafting, or a glaring
gap, as seen through the eyes of a "reasonable man" on an ad hoc
basis; and (h) if the ambiguity is patent, the contractor has an
affirmative obligation to ask the contracting officer to clarify
the true meaning of the contract language before submitting its
bid. See Fry Communications, Inc./InfoConversion Joint Venture
v. United States, 22 Cl. Ct. 497, 503-04, 510 (1991); Custom
Printing Co., supra, slip op. at 30-32; MPE Business Forms, Inc.,
supra, slip op. at 42-45; The George Marr Co., supra, slip op. at
41-43; Professional Printing I, supra, slip op. at 47-49; Webb
Business Forms, Inc., supra, slip op. at 17-19; McDonald & Eudy
Printers, Inc., supra, slip op. at 13-14; R.C. Swanson Printing
and Typesetting Co., supra, slip op. at 41, n. 22; General
Business Forms, Inc., supra, slip op. at 16-18. See also Fruin-
Colon Corp. v. United States, 912 F.2d 1426, 1430 (Fed. Cir.
1990); Lear Siegler Management Services Corp. v. United States,
867 F.2d 600, 603 (Fed. Cir. 1989); Edward R. Marden Corp. v.
United States, 803 F.2d 701, 705 (Fed. Cir. 1986); Neal & Co. v.
United States, supra, 19 Cl. Ct. at 471. (1990); Salem
Engineering and Construction Corp. v. United States, 2 Cl. Ct.
803, 806 (1983); Enrico Roman, Inc. v. United States, 2 Cl. Ct.
104, 106 (1983); Newsom v. United States, 230 Ct. Cl. 301, 303,
676 F.2d 647 (1982); S.O.G. of Arkansas v. United States, 212 Ct.
Cl. 125, 546 F.2d 367 (1976); William F. Klingensmith, Inc. v.
United States, 205 Ct. Cl. 651, 657 (1974); Norcoast
Constructors, Inc. v. United States, 196 Ct. Cl. 1, 9, 448 F.2d
1400, 1404 (1971); Firestone Tire and Rubber Co. v. United
States, 195 Ct. Cl. 21, 30, 444 F.2d 547, 551 (1971); Sun
Shipbuilding & Drydock Co. v. United States, 183 Ct. Cl. 358, 372
(1968); Max Drill, Inc. v. United States, 192 Ct. Cl. 608, 626,
427 F.2d 1233 (1967); WPC Enterprises, Inc. v. United States, 163
Ct. Cl. 1, 6, 323 F.2d 874 (1963).
33 The purpose of any rule of contract interpretation is to carry
out the intent of the parties. See Hegeman-Harris & Co., 194 Ct.
Cl. 574, 440 F.2d 1009 (1971). The test for ascertaining intent
is an objective one; i.e., the question is what would a
reasonable contractor have understood, not what did the drafter
subjectively intend. See Corbetta Construction Co. v. United
States, 198 Ct. Cl. 712, 461 F.2d 1330 (1972). See also Salem
Engineering and Construction Corp. v. United States, supra, 2 Cl.
Ct. at 806. The provisions of the contract itself should provide
the evidence of the objective intent of the parties.
34 The dictionary defines "suitable" as something "that suits a
given purpose, occasion, condition, propriety, etc., fitting,
appropriate, apt." See WEBSTER'S NEW WORLD DICTIONARY 1339 (3d
coll. ed. 1988). This is essential the same meaning of the word
applied by the Board when dealing with questions concerning the
suitability of Government-furnished material; i.e., was the
material appropriate for use in producing the end items called
for in the contract. See e.g., Braceland Brothers, Inc., GPO BCA
01-93 (August 8, 1997), slip op. at 26, 1997 WL _____; A & E Copy
Center, GPO BCA 38-92 (September 25, 1996), slip op. at 22, 1996
WL 812881; Web Business Forms, GPO BCA 31-89 (July 22, 1994),
slip op. at 13-14, 1995 WL 488523; Printing Unlimited, GPO BCA
21-90 (November 30, 1993), slip op. at 18, 1993 WL 516844.
35 Unicom Systems, Inc. involved a contract calling for standard
packaging of procured items which required cushioning of items
shipped but did not require separate packaging of individual
components. After award, the Government issued a unilateral
modification requiring packaging of individual components, which
was a costlier method, and argued that no price adjustment was
required because the parties had allegedly agreed to individual
packaging. However, the ASBCA held that the contract provision
was clear and unambiguous, and was not the result of a mutual
mistake so as to permit reformation. See Unicom Systems, Inc.,
supra, 84-3 BCA at 88,163. Furthermore, applying the "parol
evidence" rule, the ASBCA determined that since the contractor
had not made any misrepresentation to induce the Government's
assent to the disputed contract provision, the specification
discharged any prior alleged agreement with respect to the more
expensive method of packaging because it was intended as a
complete and exclusive statement of the parties' agreement. Id.,
84-3 BCA at 88,162-63. In rejecting the Government's argument
predicated on the "strict compliance" doctrine, the ASBCA
explained, in pertinent part, that: "Although Unicom questioned
the suitability of commercial packaging for the eventual overseas
shipments indicated by the solicitation documents and, therefore,
initially proposed to "over-pack" the system, the contract as
awarded required only commercial packaging in accordance with
MIL-STD-1188A and made no provision for extra protection of the
system or its associated components in contemplation of shipment
to the ultimate overseas destination. . . . To now allow the
Government to require a more expensive method of packaging at no
extra cost would deprive appellant of the benefit of its bargain
and leave appellant in a less favorable position than if the
contract had not been changed. Cf. N.G. Adair, Inc., ASBCA No.
25961, 83-2 BCA � 16,887 (advertised contract)." Id., 84-3 BCA
at 88,163.
36 Indeed, even if the Board had found that the "PACKING"
specification was ambiguous, it also would have concluded that
the ambiguity was patent, not latent, which would have required
the Appellant to seek a clarification from the Contacting
Officer. See Fry Communications, Inc./InfoConversion Joint
Venture v. United States, supra, 22 Cl. Ct. at 504, 510 (1991);
MPE Business Forms, Inc., supra, slip op. at 64-65; The George
Marr Co., supra, slip op. at 42-43, n. 34; Professional Printing
I, supra, slip op. at 48-49, n. 65; Webb Business Forms, Inc.,
supra, slip op. at 19; General Business Forms, Inc., supra, slip
op. at 17. Accord Enrico Roman, Inc. v. United States, supra, 2
Cl. Ct. at 106; Newsom v. United States, supra, 230 Ct. Cl. at
303; S.O.G. of Arkansas v. United States, supra, 212 Ct. Cl. at
131; Max Drill, Inc. v. United States, supra, 192 Ct. Cl. at 626;
WPC Enterprises, Inc. v. United States, supra, 163 Ct. Cl. at 6.
37 These two contract mechanisms, essentially operate
independently of each other, and neither reduces any rights under
the other by which GPO can avoid the finality of acceptance. The
Respondent's burden of proof differs depending on whether it
seeks to recover under the "Warranty" clause or for alleged
latent defects under the "Inspections and Tests" clause. Under
the "Warranty" clause, the Government must establish by a
preponderance of the evidence that: (a) the defective material,
workmanship, or nonconformance with the specifications was the
most probable cause of the insulator failures when considered
with any other possible clauses; and (b) it did not cause or
contribute to the failures or the defects. See ABM/Ansley
Business Materials, supra, 93-1 BCA at 125,748; Joseph Penner,
GSBCA No. 4647, 80-2 BCA � 14,604, at 72,019. It is not
necessary for GPO to show precisely what acts or omissions by the
Appellant caused the defects. On the other hand, a "latent
defect" claim is much broader and can cover defects that arose
both in the warranty period and afterward (post-warranty).
However, to sustain such a claim, the Respondent must prove a
definite nexus between the defect and the product failure; i.e.,
it is not enough for the Government simply to allege an array of
possible defects or even to establish the existence of a defect
in the hope that something will stick. Merely because post-
acceptance failures occurred does not mean that defects existed
at the time of acceptance. See ABM/Ansley Business Materials,
supra, 93-1 BCA at 125,749-50. In other words, an item that
fails to function cannot be said to be ipso facto latently
defective-proof of the defect that caused the failure must be
direct and not left to inference. Failure alone is not proof of
a nonconformity or defect, much less a latent defect. See Bart
Associates, Inc., EBCA Nos. C-9211144, C-9312163, 96-2 BCA �
28,479, at 142,235.
38 While the Government's argument is clear enough, its record
evidence on this issue somewhat confusing. Thus, the GPO analyst
who performed the paper test admittedly based her roughness
findings for 20 pound paper on a standard derived from the JCP
O-61 specification (R4 File, Tab D, QCTD Report). On the other
hand, the subsequent declaration of the Chief, Paper and Physical
Testing Division, QCTD, implies that JCP O-61 itself could still
be used to evaluate the smoothness of 20 pound paper. See note
11 supra (Subt Declaration, � 4). However, the Board notes that
while Subt is critical of the extrapolation technique employed by
the analyst, calling it "misleading," id., the record shows that
on April 16, 1993, she endorsed the test report ( (R4 File, Tab
D, QCTD Report).
39 In printing, smoothness is more important for letterpress and
gravure but has little effect on offset, and the major impact of
this paper quality is that as smoothness decreases, solids and
halftones get sandy and rough in appearance. See POCKET PAL, at
166.
40 Runnability means nothing more than "the ability to get the
paper through the press." See POCKET PAL, at 164. It is
interesting to note that one factor which can affect runnability
is the equilibrium moisture content or RH in the pressroom. Id.
Depending on whether the moisture content is too high or too low,
paper can develop wavy edges, or tight edges, either of which can
cause wrinkles and/or misregister in printing, especially in
offset. Id.
41 This is not to say that a subjective evaluation is suspect per
se. The law also recognizes that there is always an element of
subjectivity in the appraisal of any product, and boards of
contract appeals will sustain the subjective findings of an
inspector or contracting officer as long as the test method used
is reasonable. See Interstate Reforesters, Dale Whitley, AGBCA
No. 87-374-3, 89-1 BCA � 21,375. In that regard, any test which
conforms to generally accepted industry practice is usually
considered reasonable. See M.J.W. Enterprises, ENGBCA No. 5813,
93-1 BCA � 25,405; DiCecco, Inc., ASBCA No. 11994, 69-2 BCA �
7821. Furthermore, the law allows the application of subjective
standards to enforce contract specifications expressing a
requirement in absolute or imprecise language because such terms
are not suited for application of the strict compliance doctrine-
absolute requirements especially cannot be literally attained.
See Mid-American Engineering and Manufacturing, ASBCA No. 20939,
78-1 BCA � 12,870; Canon Construction, Inc., GSBCA No. 11227,
92-2 BCA � 25,001; Bonny Products, Inc., GSBCA No. 4577, 76-2 BCA
� 12,158; Dirigo Compass & Instrument Co., ASBCA No. 9162, 65-2
BCA � 4938. Moreover, Board precedent recognizes that just
because a judgment is subjective it is not necessarily it
invalid, since the qualifications of the person making the
evaluation is relevant and must always be taken into
consideration. See Fry Communications, Inc., GPO BCA 22-84
(February 20, 1986), slip op. at 17-18, 1986 WL 181462. Accord
Interstate Reforesters, Dale Whitley, supra. Where a contractor
challenges the results of an inspection on the ground that the
test was subjective, the main focus of the Board's inquiry is on
whether or not the evaluator applied the appropriate or correct
standards, not whether his judgment was right or wrong. See Fry
Communications, Inc., supra, slip op. at 18-20.
42 The Board was created by the Public Printer in 1984. See GPO
Instruction 110.10C, Subject: Establishment of the Board of
Contract Appeals, dated September 17, 1984. Before then, ad hoc
panels considered disputes between contractors and GPO. Elgin
Business Forms and Electronic Composition, Inc. are ad hoc panel
cases. The Board cites the decisions of these ad hoc boards as
GPOCAB. While the Board is not bound by ad hoc panel rulings,
its policy is to follow them where applicable and appropriate.
See e.g. Custom Printing Co., supra, slip op. at 24, n. 38; Big
Red Enterprises, supra, slip op. at 22, n. 22; The George Marr
Co., supra, slip op. at 50, n. 40; New South Press & Assoc.,
Inc., supra, slip op. at 32, n. 45; Shepard Printing, supra, slip
op. at 14, n. 19; Stephenson, Inc., supra, slip op. at 18, n. 20;
Chavis and Chavis Printing, GPO BCA 20-90 (February 6, 1991),
slip op. at 9, n. 9, 1991 WL 439270.
43 The regulatory foundation for the Board's reasoning was the
PPR, which it said establishes the basic framework for the
inspection and testing of procured products. See Professional
Printing I, supra, slip op. at 66. In that regard, the Board
said that: "[ a]part from providing the foundation for QATAP, and
establishing the program as an integral part of most procurement
contacts, the PPR also states that such inspection and testing
'shall be performed in accordance with article 14 'Inspection and
Tests' of Contract Clauses in GPO Contract Terms (Pub. 310.2).'
[Footnote omitted.] See, PPR, Chap. XIII, Sec. 1, �� 3(a),(b),
4(c)(2),(g). Furthermore, the PPR, inter alia: (1) provides
guidance for gathering inspection samples; (2) sets forth basic
inspection procedures; (3) makes special provisions for the
inspection of departmental random copies (blue label copies); and
(4) requires that appropriate records and documentation of all
quality assurance actions be maintained. See, PPR, Chap. XIII,
Sec. 1, �� 4(g)(1)-(4), h." See Professional Printing I, supra,
slip op. at 66-67. As the Board read the PPR, the various QATAP
manuals incorporated by reference therein, and the "Inspections
and Tests" article of GPO Contract Terms, it was clear that: ". .
. the proper inspection and testing of procured products
consists of three things: (1) a sample which is randomly selected
and adequate enough to be representative of the lot; (2) the use
of proper testing procedures and techniques; and (3) the presence
of objective standards by which to measure the procured product.
[Citations omitted.] . . . [a] contracting officer who shows that
he has adhered to the testing and inspection requirements of the
contract is entitled to have his determination of product quality
upheld. [Citation omitted.]" See Professional Printing I, supra,
slip op. at 67. [Emphasis added.]
44 The EBCA observed that the contract only required that the
polymer insulators be equal to the porcelain insulators in terms
of mechanical strength and electrical characteristics. In fact,
the Government's tests showed that the polymer insulators were
indeed equal to the porcelain insulators in those properties.
Therefore, the EBCA stated that since the polymer insulators were
equal, the contractor "had every right to assume that use of
polymer insulators as specified would achieve the desired
result." See Bart Associates, Inc., supra, 96-2 BCA at
142,235-4.
45 See note 15 supra.
46 Even though the Contracting Officer improperly applied the
remedy provisions of the "Warranty" clause in this case, the
Board finds no basis for holding that he also abused his
discretion. He clearly misread the "Warranty" clause, but his
action, while erroneous, cannot be said to be so unreasonable as
to warrant an abuse of discretion finding. See Questar Printing,
Inc., GPO BCA 19-94 (June 12, 1997), slip op. at 73-74, n. 76,
1997 WL _____ (misapplication of the procedural requirements of
the "Default" clause). Moreover, the Board cannot emphasize too
strongly that an abuse of discretion finding is not to be taken
as a personal criticism of the contracting officer. As the Board
pointed out in Questar Printing, Inc., "[w]hile it is customary
to speak in terms of a contracting officer's abuse of discretion,
in reality the abuse of discretion is committed by the
contracting agency because the authority to terminate is vested
in 'the Government,' rather than the 'Contracting Officer,' per
se." Id. (citing PLB Grain Storage Corp., AGBCA Nos. 89-152-1,
89-153-1, 89-154-1, 91-205-1, 92-1 BCA � 24,731; Sol O.
Schlesinger, dba Ideal Uniform Cap Co. v. United States, 182 Ct.
Cl. 571, 390 F.2d 702 (1968)).