Gorn Corporation v. United States

• Decision Date: 17 April 1970
• Docket Number: No. 326-68.,326-68.
• Citation: 191 Ct. Cl. 560,424 F.2d 588
• Parties: GORN CORPORATION v. The UNITED STATES.
• Court: U.S. Claims Court

191 Ct. Cl. 560, 424 F.2d 588 (1970)

GORN CORPORATION v. The UNITED STATES.

No. 326-68.

United States Court of Claims.

April 17, 1970.

Andrew J. Simons, Washington, D. C., attorney of record, for plaintiff. Walston S. Brown and Willkie Farr & Gallagher, New York City, of counsel.

Russell W. Koskinen, Washington, D. C., with whom was Asst. Atty. Gen. William D. Ruckelshaus, for defendant.

Before COWEN, Chief Judge, and LARAMORE, DURFEE, DAVIS, COLLINS, SKELTON and NICHOLS, Judges.

ON PLAINTIFF'S MOTION AND DEFENDANT'S CROSS-MOTION FOR SUMMARY JUDGMENT

SKELTON, Judge.

This case arises out of an appeal by plaintiff, the Gorn Corporation, from a decision of the Armed Services Board of Contract Appeals (ASBCA) (ASBCA numbers 11643 and 11859, 67-1 BCA Para. 6327). Relief is sought by plaintiff under the terms of the Wunderlich Act, 41 U.S.C. §§ 321, 322 (1964). In Count I of its petition, plaintiff seeks the amount ($10,995.11) defendant has withheld in accordance with the ASBCA decision from amounts due to plaintiff on other contracts. In Count II, plaintiff seeks recovery for lost profits and for costs of labor, materials, tooling and other items caused by the wrongful termination of the contracts in the instant case. The case is now before the court on cross-motions for summary judgment. We have concluded that judgment should be entered for the plaintiff.

Defendant, through its agent the Defense Electronics Supply Center, let two contracts for the furnishing of radio frequency switches to Coaxial Components Corporation, then a wholly owned subsidiary of Gorn Electric Company Inc.¹ Contract DSA 9-19124 was executed April 14, 1965, and contract DSA 9-19336 was signed May 3, 1965. Plaintiff contends the specifications called for switches with a voltage capacity of 28 volts direct current ("28 VDC"); defendant contends the specifications called for a voltage capacity of 115 volts alternating current ("115 VAC"). Plaintiff tendered four 28 VDC switches, and the contracting officer rejected them and terminated the contract for default. By stipulation, the only matter before the ASBCA on appeal from the default termination was whether the contracts and specifications called for 28 VDC switches or 115 VAC switches. On April 28, 1967, the ASBCA found that the contracts called for 115 VAC switches, and denied plaintiff's appeal. This decision was reaffirmed on August 17, 1967. Since the ruling of the ASBCA involved questions of law, its decision is not entitled to finality under the Wunderlich Act, 41 U.S.C. § 322 (1964), Maxwell Dynamometer Co. v. United States, 386 F.2d 855, 181 Ct.Cl. 607 (1967), and we are not bound by it.

On December 14, 1964, defendant requested proposals for the supplying of 136 switches. The switches were described as:

XXXX-XXX-XXXX Switch, Radio Frequency General Communications P/N 2HNRP1-14 FXR Division P/N XXX-XXXXX

The request for proposals further advised bidders that:

The Government does not possess drawings, specifications or purchase data which fully describe the items called for herein. Therefore, proposals/quotations are solicited only from the cited manufacturers or suppliers who have previously furnished the item to the cited manufacturers or those who possess data which fully describes the specified product and can furnish the same in support of their proposals/quotation.

Offerors must supply complete data if alternate proposal is to be evaluated; data must be supplied with proposal. Emphasis supplied.

In this description, the first line "XXXX-XXX-XXXX" is a Federal Stock Number. The third line "General Communications P/N 2HNRP1-14" indicates the part number of a switch manufactured by General Communications Company. Apparently some time after January 1962, the numbering system was changed, and the fourth line reflects the new part number.

Using the above description as a guideline, plaintiff first issued a proposal to provide a switch identified as P/N RO2-2-15-A-1. The government rejected this proposal. Plaintiff then submitted an amended proposal for a switch identified as P/N RO2-2-15A3H accompanied by a drawing of this switch. This second switch was clearly identified in large bold letters in the drawing (plaintiff's exhibit C, shown below) as a "Coaxial Relay, 28 VDC Type RO2 Rotary Switch." Emphasis supplied.

In addition, the drawing does not contain a rectifier, which would be needed on a switch using alternating current. This proposal was accepted by the government, and the contracts were awarded. The contract language called for switches identified as:

XXXX-XXX-XXXX — Switch, Radio Frequency, Coaxial Components Corp. P/N RO2-2-15A3H with electrical specifications as outlined in General Communications dwg/part No. 2HNRP1-14.

Thus, the contracts identified the switches by plaintiff's part number, which clearly called for a 28 VDC switch. Defendant contends that not only did the specifications call for 115 VAC switches, as found by the ASBCA, but also that plaintiff's assurance in his proposal that "The Electrical Specifications for the proposed Coaxial Components Corp. P/N RO2-2-15A3H, are in accordance with the Electrical Specifications of the required FXR Division P/N XXX-XXXXX and General Communication P/N 2HNRP1-14," removed from the defendant the burden of checking to see if plaintiff's drawings met the specifications.

The crucial issue now is whether plaintiff reasonably complied with the terms of the specifications and contracts by building the 28 VDC switches. This question turns on the government's description of the desired switches in its request for proposals, and whether this description put plaintiff on notice that only 115 VAC switches would be acceptable. We hold that plaintiff did reasonably comply with the terms of the specifications and contracts.

The first line of the government's description is the Federal Stock Number. This does not tell a prospective bidder the voltage requirements of the switches, and defendant does not allege to the contrary. The second line, "Switch Radio Frequency," likewise does not contain any voltage information.

Line 3 contains the General Communications part number, 2HNRP1-14. Defendant alleges that this number contains the clue which will unlock the mystery of the type of voltage and current required. Actually, this alleged "clue" would require a bank of computers to cross-check a long list of catalog references and tables to determine its meaning. "2HNRP1-14" was a model designation in the manufacturer's catalog. The corresponding table in the catalog stated that the switch could come in a variety of voltages, including 28 VDC and 115 VAC. It was in reliance on this statement that plaintiff submitted its clearly worded proposal to furnish 28 VDC switches. But, says defendant, this reference to the catalog is not enough. First off, model No. 2HNRP1-14 was changed to 2HN90R28DL in June 1964. (Defendant ignores plaintiff's statement that it had no knowledge of this change, nor could it have had any such knowledge, since this new number was not used or referred to in the bidding documents, but was used for the first time in connection with reprocurement after plaintiff's contract had been terminated.) Defendant then says...