MARCH 3, 1924, 3 COMP. GEN. 577

MARCH 3, 1924, 3 COMP. GEN. 577

CONTRACTS - TITLE - LOSS OR DAMAGE IN TRANSIT UNDER A CONTRACT FOR SWITCHBOARDS TO BE DELIVERED F.O.B. AND INSPECTED AT PLANT OF CONTRACTOR, AND FORWARDED ON A GOVERNMENT BILL OF LADING, UPON DELIVERY TO THE CARRIER THE TITLE PASSES TO THE GOVERNMENT AND THE CONTRACTOR IS NOT LIABLE FOR DAMAGES IN TRANSIT.

DECISION BY COMPTROLLER GENERAL MCCARL, MARCH 3, 1924:

THE A. G. MANUFACTURING CO., OF SEATTLE, WASH., HAS REQUESTED REVIEW OF SETTLEMENT M-1100-W, THIS OFFICE, DATED SEPTEMBER 4, 1923, CHARGING IT FOR DAMAGES TO A SWITCHBOARD WHICH WAS FURNISHED TO THE UNITED STATES UNDER PURCHASE ORDER 41318, APRIL 23, 1921.

THE A. G. MANUFACTURING CO., PURSUANT TO ADVERTISEMENT NO. 57, DATED JANUARY 29, 1921, BY THE WAR DEPARTMENT, AND PROPOSAL NO. 57, DATED FEBRUARY 3, 1921, AND PURCHASE ORDER 41318 DATED APRIL 23, 1921, AGREED TO DELIVER NOT LATER THAN 75 DAYS AFTER RECEIPT OF NOTICE OF APPROVAL OF THE CONTRACT, F.O.B. SEATTLE, WASH., PACKED FOR DOMESTIC SHIPMENT, SUBJECT TO INSPECTION AT PLANT OF CONTRACTOR AT SEATTLE, TWO SWITCHBOARDS, NOS. 463 AND 464, SAID SWITCHBOARDS TO BE SHIPPED ON GOVERNMENT BILL OF LADING TO THE UNITED STATES ENGINEER FIELD OFFICE, FORT DU PONT, DELAWARE CITY, DEL.

ON RECEIPT OF THE SWITCHBOARDS FROM THE CARRIER IT WAS FOUND THAT BOARD NO. 464 WAS IN A BROKEN AND UNSERVICEABLE CONDITION, AND A MEMORANDUM TO THIS EFFECT WAS INDORSED ON THE ORIGINAL BILL OF LADING; WHEREUPON THE WAR DEPARTMENT HAD THE WESTINGHOUSE CO. REPAIR THE SAME AT A COST OF $132.64 AND ACCORDINGLY MADE A DEMAND UPON THE CONTRACTOR FOR THE AMOUNT UPON THE THEORY THAT THE CONTRACTOR HAD GUARANTEED TO DELIVER SAID SWITCHBOARD TO THE UNITED STATES AT DESTINATION IN GOOD ORDER. THE CONTRACTOR DECLINED PAYMENT ON THE GROUND THAT DELIVERY WAS MADE F.O.B. SHIPPING POINT, IN ACCORDANCE WITH THE CONTRACT, AND THAT THIS CONSTITUTED A DELIVERY TO THE UNITED STATES, AND IF THERE WAS ANY DAMAGE IT WAS DUE TO THE NEGLIGENCE OF THE CARRIER.

THE QUESTION INVOLVED IS WHETHER DELIVERY TO THE CARRIER IN THIS CASE CONSTITUTED DELIVERY TO THE GOVERNMENT SO AS TO RELIEVE THE CONTRACTOR FROM RISK OF DAMAGE IN TRANSIT.

SECTION 17 OF THE ADVERTISEMENT NO. 57 PROVIDES:

PAYMENT.--- PAYMENT WILL BE MADE FOR THE ARTICLES AFTER THEY HAVE BEEN INSPECTED, ACCEPTED, AND DELIVERED PROPERLY PACKED FOR SHIPMENT F.O.B. CARS (OR BOAT) AT THE PLACE STATED IN THE PROPOSAL * * *.

THE PART OF THE PROPOSAL WHICH IS MATERIAL TO THIS CASE PROVIDES:

IN ACCORDANCE WITH YOUR ADVERTISEMENT NO. 57 DATED JANUARY 29, 1921, INVITING PROPOSALS FOR TWO SWITCHBOARDS * * * AND SUBJECT TO ALL CONDITIONS AND REQUIREMENTS THEREOF AND OF YOUR SPECIFICATIONS IN CONNECTION THEREWITH, COPIES OF BOTH OF WHICH ARE HERETO ATTACHED, AND SO FAR AS THEY RELATE TO THIS PROPOSAL ARE MADE A PART OF IT, WE (OR I) PROPOSE TO FURNISH F.O.B. CARS (OR BOAT) AT (PLACE OF MFR.) WITHIN 75 CALENDAR DAYS AFTER RECEIPT OF NOTIFICATION OF APPROVAL OF THE CONTRACT THE FOLLOWING MATERIAL:

SWITCHBOARD NO. 463, OF TWO PANELS.

SWITCHBOARD NO. 464, OF ONE PANEL.

PURCHASE ORDER 41318 PROVIDES:

PLEASE DELIVER THE FOLLOWING NOT LATER THAN 75 DAYS AFTER RECEIPT OF NOTIFICATION THAT CONTRACT HAS BEEN APPROVED, F.O.B. SEATTLE, WASH. PACKED FOR DOMESTIC SHIPMENT. INSPECTION AT A. G. MFG. CO., SEATTLE, WASH. * * * SWITHCBOARD NO. 463 CONSISTING OF TWO FEEDER PANELS * * *; SWITCHBOARD NO. 464 CONSISTING OF ONE FEEDER PANEL.

SECTION 35 OF THE ADVERTISEMENT PROVIDES:

BOXING.--- THE PANEL AND OTHER MATERIAL SHALL BE CAREFULLY BOXED (NOT CRATED) IN NEW BOXES AND CARE MUST BE EXERCISED IN PACKING TO GUARD AGAINST BREAKAGE OF THE MARBLE, DAMAGE TO APPLIANCES, AND THE LOSS OF SMALL PARTS IN TRANSIT. THE METHOD OF PACKING WILL BE LEFT TO THE MANUFACTURER WITH THE UNDERSTANDING THAT THE PANEL AND APPLIANCES IF RECEIVED BROKEN OR DAMAGED SHALL BE REPLACED IF IT IS CLEARLY EVIDENT THAT THE DAMAGE OR LOSS WAS DUE TO THE FAILURE OF THE MANUFACTURER TO PROPERLY SECURE AND PROTECT THE PANEL OR APPLIANCES IN THE BOX, OR TO THE INADEQUATE OR POOR CONSTRUCTION OF THE BOXES. DELIVERY OF THE NEW PANEL OR APPLIANCES AT THE FACTORY OF THE MANUFACTURER PACKED FOR SHIPMENT, THE PANEL BEING DRILLED FOR MOUNTING APPLIANCES THEREON, WILL BE CONSIDERED AS COMPLYING WITH THE INTENT OF THIS REQUIREMENT.

THE GOVERNMENT BILL OF LADING DATED JULY 3, 1921, ACKNOWLEDGES RECEIPT OF THE ARTICLES IN GOOD CONDITION TO BE FORWARDED TO FORT DU PONT, DELAWARE CITY. WHEN THE SWITCHBOARD REACHED ITS DESTINATION IT WAS FOUND TO BE BROKEN AND UNSERVICEABLE AND A NOTATION WAS MADE ON THE BILL OF LADING TO THIS EFFECT.

THE QUESTION AS TO WHETHER THE SWITCHBOARD WAS PACKED IN ACCORDANCE WITH THE TERMS OF THE CONTRACT IS THE MATERIAL ISSUE FOR DETERMINATION. AFFIDAVIT FROM THE GOVERNMENT ELECTRICIAN EXECUTED DECEMBER 8, 1921, STATES THAT IN HIS OPINION THE BOXES WERE SUFFICIENTLY STRONG AND THE MATERIAL USED WAS SUFFICIENTLY STRONG TO WITHSTAND ORDINARY HANDLING AND FREIGHTING. THE DISTRICT ENGINEER, SEATTLE, WHO INSPECTED THE SWITCHBOARDS AND SUPERVISED THE PACKING AND SHIPMENT OF SAME, STATES THAT THE BOARDS WERE PACKED WITH SPECIAL CARE. IT IS ALSO IN EVIDENCE THAT THE BOARDS WERE PACKED BY A MAN OF 10 YEARS' EXPERIENCE AND THAT DURING HIS 10 YEARS' EXPERIENCE THIS WAS THE FIRST SWITCHBOARD TO BE BROKEN WHEN PACKED AS THIS BOARD WAS PACKED. THE BOX WAS CONSTRUCTED OF 2-INCH LUMBER INSTEAD OF THE CUSTOMARY 1-INCH MATERIAL AND UNUSUAL CARE WAS TAKEN IN PACKING OWING TO THE LONG DISTANCE TO THE POINT OF DESTINATION.

THE FACTS APPEARING DO NOT INDICATE THAT THE CONTRACTOR WAS IN ANY WAY RESPONSIBLE FOR THE DAMAGED CONDITION OF THE GOODS, AND THERE IS A PRESUMPTION THAT THE DAMAGE WAS DUE TO ROUGH HANDLING BY THE CARRIER IN TRANSIT. IT IS TO BE NOTED THAT BOTH THE PROPOSAL AND THE PURCHASE ORDER ARE IN ACCORD WITH SECTION 17 OF THE ADVERTISEMENT ON THE QUESTION OF DELIVERY. CONSIDERING THE PROVISIONS OF THE CONTRACT AND THE FACTS PRESENTED IT MUST BE HELD THAT DELIVERY TO THE CARRIER CONSTITUTED DELIVERY TO THE UNITED STATES AND THAT ANY CLAIM FOR DAMAGES SHOULD HAVE BEEN MADE AGAINST THE CARRIER.

WHERE IT APPEARS FROM INSPECTION AND THE BILL OF LADING THAT GOODS ARE RECEIVED FROM THE VENDOR IN GOOD CONDITION BY THE CARRIER AT SHIPPING POINT UPON INSTRUCTIONS FROM THE UNITED STATES, AS BETWEEN THE PARTIES TO THE CONTRACT THE GOVERNMENT MUST BE TAKEN TO HAVE ASSUMED THE RISK OF DAMAGE ARISING FROM THE CARRIAGE. SEE 12 WALL., 262; 207 U.S., 229; 8 COMP. DEC., 731; 15 ID., 167.

IN THIS CASE THE CARRIER BECAME THE AGENT OF THE UNITED STATES ON RECEIPT OF THE GOODS AT POINT OF SHIPMENT ACCORDING TO THE TERMS OF THE CONTRACT AND BILL OF LADING. DELIVERY OF THE SWITCHBOARDS AT SEATTLE WAS DELIVERY TO THE UNITED STATES AND THE UNITED STATES THEREUPON BECAME LIABLE TO THE CONTRACTOR FOR THE PURCHASE PRICE.

UPON REVIEW, A DIFFERENCE OF $132.64 IS CERTIFIED TO REMOVE THE CHARGE RAISED AGAINST THE CONTRACTOR.