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no basis exists for reforming the provisions of the contract relating to import duty on the basis of mistake so as to give the contractor the benefit of the savings which were involved. It is well settled that where a contract expresses the true agreement of the parties— and in this respect the correctness of the provisions of the instant contract relating to import duty have not been questioned-it cannot be reformed because one or both of the parties were mistaken as to its legal import or effect. See Tokio Marine & Fire Ins. Co. v. National Union Fire Ins. Co., C.C.A.N.Y., 91 F. 2d 964; Shell Petroleum Corporation v. Corn, C.C.A. Kans., 54 F. 2d 766; Godwin v. Orgain, D.C. Ala., 160 F. Supp. 757. Furthermore, it is not enough to justify reformation that a court may be satisfied that the parties would have come to a certain agreement had they been aware of the actual facts. See 26 Comp. Gen. 654, 657, citing court cases.

Therefore, in the absence of any basis for reformation of the contract, the terms of the contract as written govern the rights and obligations of the parties. Under the above-quoted provisions of clause 10(e) of Standard Form 32, it was agreed that if the contractor should be relieved from the payment or the burden of any import duty included in the contract price, the contract price was to be correspondingly decreased or the amount of such relief paid over to the Government. In view thereof, and of the provisions made in the Bidding Schedule for the recoupment by the Government of any part of the amount shown to have been included in the contract price for import duty which the contractor was not required to pay, there would appear to be no question as to the Government's right to deduct the sum of $3,303 here involved from the contract price of the equipment notwithstanding the fact that the savings with respect to import duty resulted from the contractor's furnishing equipment of domestic manufacture under the contract. The savings were nevertheless realized by the contractor and are by the terms of the contract due the Government. See United States v. Kansas Flour Corporation, 314 U.S. 212.

In conclusion, it seems pertinent to observe that the authorization to substitute Westinghouse circuit breakers of domestic manufacture for the equipment of Italian manufacture specified to be furnished under the contract was granted at the request of the contractor to enable it to furnish circuit breakers which met the requirements of the specifications, which it had not, up until that time, been unable to do. Since the contractor was already bound to do this under the contract, or become liable for excess costs and further liquidated damages thereunder, there would be no consideration moving to the Government for relinquishment of its right to the savings with respect to import duty.

Accordingly, Bureau Voucher No. 3893–59, together with supporting papers, is returned herewith and you are advised that payment thereon is not authorized.

[B-138800]

Contracts-Commissary Store Sales-Transportation Costs The purpose of the commissary stores provision in section 613, Department of Defense Approprition Act, 1960, being to require the fixing of commissary prices to cover a substantial part of the costs of operation of the commissary store system, the statute should be regarded as remedial in nature and liberally construed and the exception as to transportation should be strictly construed, so that, in the absence of any indication in the legislative history that the phrase "excluding all transportation outside the United States" means transportation outside the boundaries of any state, the usual meaning-transportation to a place without the United States-should prevail; therefore, the prohibition must be regarded as requiring the inclusion of the cost of transportation in the United States in the sale prices of commissary stores.

To the Secretary of the Army, November 18, 1959:

Reference is made to your letter of October 1, 1959, requesting reconsideration of the interpretation expressed in our letter of August 11, 1959, to Senator E. L. Bartlett, of section 613 of the Department of Defense Appropriation Act, 1960 (P.L. 86–166), 73 Stat. 380, which in effect requires the sale prices of commissary stores to include the cost of commercial transportation in the United States.

In the letter referred to, we quoted from the report of the House Committee on Appropriations the statement of the committee with respect to the proposal, contained in the budget submission, for a modification of the language of the section "which would have had the effect of excluding the cost of commercial transportation to and in Alaska ***" We construed the refusal of the committee and the Congress to adopt the proposed modification as indicative of an intent that the cost of transportation of commissary supplies "to and in Alaska" should be included in commissary prices.

It is your contention that, so far as concerns commissary supplies sold in Alaska, the section in question requires that there be included in sale prices only so much of the transportation cost as is applicable to movement of the supplies between points entirely within the boundaries of Alaska, or other states, and that the phrase "excluding all transportation outside the United States" means that transportation costs covering any part of the carriage which occurs outside the boundaries of any state may be excluded from commissary sale prices. We are unable to agree either that your interpretation is so clear on the face of the statutory language, taken in its ordinary meaning, as to make it unnecessary to resort to the legislative history, or that the legislative background supports your contention.

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According to Webster's new International Dictionary, 1951 ed., the preposition "outside" means "On or to the outside or exterior of; without or beyond the limits of." In Union Fisherman's Cooperative Packing Co. v. Shoemaker, 98 Ore. 659, 193 P. 476, 480, it is said that the ordinary meaning of "outside" is "to the exterior of, without, outward from." While not necessarily inconsistent with the interpretation proposed by you, both those definitions tend rather more strongly to support the view that "transportation outside the United States" connotes carriage away from, or to a point beyond or without the United States. This construction is also favored by the normal and customary usage of "transportation" as meaning movement or carriage from one place to another. See Republic Oil Refining Co. v. Grauzer, 98 F. Supp. 921, 933; Dixie Oil Co. v. United States, 24 F.2d 804; Gloucester Ferry Co. v. Pennsylvania, 114 U.S. 196. Thus, the more natural understanding of the phrase "transportation outside the United States" would be that it was intended to encompass carriage from one place to another without the United States.

As a practical matter, this interpretation avoids certain administrative problems which might be presented under your department's view. In his statement before the Senate Appropriations Subcommittee considering the current appropriation law, the representative of the Defense Department-apparently adopting the interpretation which you now urge-argued that the effect of section 613 would be merely to necessitate an increase in the cost-of-living allowances to military personnel in Alaska, and that "all the bookkeeping to (1) determine the cost of transportation to the border of the United States (before Alaska became a State); (2) exclude the part until you get to the border of Alaska; and (3) pick up the cost of transportation within Alaska, is just a lot of bookkeeping and does not save the Government a nickel." (p. 1620, Hearings before the Subcommittee of the Committee on Appropriations, United States Senate, 86th Congress, H.R. 7454.) Under your interpretation, we envisage the possibility of an even greater administrative problem in the event of the promulgation of through rates for transportation between points in Alaska and interior points in other States (which appears to be a definite possibility in view of the pendency in the Congress of proposed legislation to confer jurisdiction upon the Interstate Commerce Commission over transportation between Alaska and the other states), since it would then be necessary not only to do the accounting but also to determine how much of the through rate could be excluded. Further difficulties of the same kind would be presented if domestic packers or other suppliers of commissary items should offer freight equalization or other pricing systems to equalize, wholly or in part, prices in Alaska with those in other areas of the United States.

While it may be that if the question under consideration had been specifically brought to the attention of the cognizant congressional committees other language would have been used to clarify the intent of the Congress, we believe that the legislative record, to the extent that it may be resorted to, tends to show that the committee rejected the proposed modification of the prior law because it felt that the customers of commissary stores in Alaska, while in receipt of pay differentials based upon higher living costs, should not also have the duplicate benefit of subsidized transportation costs to keep prices down.

Further tracing the legislative history of the language of section 613 of the current act, we find that it was first enacted as section 628 of the Defense Appropriation Act, 1952 (P.L. 179, 82d Congress), 65 Stat. 449, over strenuous objections from the military departments to the inclusion of any transportation or overhead costs in commissary prices, and has been carried in each annual act since. Statements before the congressional committees in connection with the matter at that time show that the arguments against the provision were in large part identical with those now urged against our interpretation of the exception-for example, that the pricing of commissary supplies to cover costs in addition to the bare cost of items sold would in effect amount to a pay cut; that military pay had been fixed with reference to the established pricing structure of commissary stores; and that administrative expense would be increased. See House Subcommittee hearings, Part 1, pp. 148 et seq.; Senate Subcommittee hearings, pp. 1234-6; 1606-15; 1843-9. The provision was nevertheless adopted.

Looking to the purpose of the enactment, which was to require the fixing of commissary prices adequate to cover at least a substantial part of the costs of operations of the commissary store system, we believe that it should be regarded as remedial in nature and, therefore, is to be liberally construed, and that the exception as to transportation outside the United States should be applied strictly. References in the hearings and committee reports clearly show that the exception intended was as to overseas transportation, and we believe that the accepted connotation of that expression-particularily in time of war, as in 1952—is that it is synonymous with transportation to foreign areas, and does not refer to transportation between States of the Union.

For the reasons stated, we believe it necessary to adhere to the interpretation indicated in the letter of August 11, 1959, to which you refer, until such time as there is a clearer manifestation of congressional intent.

[B-141144]

Appropriations-River and Harbor Funds-Improvement of Access Road to Project

In the absence of any indication in a Senate document detailing plans for a river improvement project that construction of access roads outside the project or the improvement of a similarly situated State public road was contemplated, the use of a public works appropriation which is available solely for "projects authorized by law" for necessary improvements to a state public road used for access to the project by Government personnel would be in contravention of the prohibitory statutes-sections 3678, 3679 and 3733 of the Revised Statutes, 31 U.S.C. 628, id. 665, and 41 U.S.C. 12-which require appropriations to be applied solely to the objects for which they are made, preclude execution of contracts in advance of appropriation without authorization and prohibit contracts for public improvements unless funds are specifically appropriated therefor. To the Secretary of the Army, November 18, 1959:

By letter dated October 28, 1959, the Assistant Secretary of the Army (Manpower, Personnel and Reserve Forces) submitted for our consideration a proposed contract with the State Road Commission of West Virginia requiring the use of Federal funds for the improvement of West Virginia Secondary Route 40/5 which is used for access to the Hildebrand Lock and Dam, Monongahela River, West Virginia, by Government personnel in the operation and maintenance of the project.

The letter states that the existing State Secondary Route 40/5 is approximately 0.85 miles in length and dead ends at Monongahela River near the Hildebrand lock site; the road serves only four residences, two of which are located at its terminus near the river; the remaining two are located near the beginning of the road at its connection with State Route 40; the road has steep grades and is generally in poor condition; the travel surface consists of earth and stone and ranges from 12 to 20 feet in width; this surface is pitted in areas; and the lack of shoulders causes surface damage to erode the travel area. The letter further states that deep ditches have formed along the edge of the travel area due to the lack of drainage facilities; several springs within the travel portion add to existing road deficiencies; and the combination of these deficiences creates hazardous travel conditions at all times particularly in winter seasons when the roadway is frozen. It appears that since State Secondary Route 40/5 is a deadend road and serves only two residences at its terminus near the river, the State Road Commission does not feel obligated to furnish and maintain any better road than that which exists.

The letter further states that according to the terms of the proposed contract the State would improve the existing road in order to provide necessary and convenient all-weather access for use of Government personnel in operation and maintenance of the Hildebrand Lock and Dam; the improvement would consist of alleviating

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