B-156948, JUL. 19, 1965

B-156948, JUL. 19, 1965

TO ADMINISTRATOR, GENERAL SERVICES ADMINISTRATION:

REFERENCE IS MADE TO A LETTER DATED JUNE 4, 1965, WITH ENCLOSURES, FROM YOUR GENERAL COUNSEL, CONCERNING THE REQUEST OF MARKOWITZ BROS., INC., HEREINAFTER REFERRED TO AS MARKOWITZ, FOR PAYMENT OF AN ADDITIONAL $5,365.20 UNDER CONTRACT NO. GS-03B-11665 AS A RESULT OF AN ALLEGED ERROR IN CONNECTION WITH CHANGE ORDER NO. 16 TO SAID CONTRACT.

THE RECORD INDICATES THAT ON JUNE 26, 1963, A CONTRACT FOR THE INSTALLATION OF AIR CONDITIONING IN THE INTERNAL REVENUE BUILDING, WASHINGTON, D.C., PROJECT NO. 1269, WAS AWARDED TO MARKOWITZ ON THE BASIS OF ITS BASE BID NO. 1 AND ALTERNATE BID NO. 3-A. THE TOTAL CONTRACT PRICE FOR THE WORK WAS $3,485,000.

SECTION 10-01C OF THE SPECIFICATIONS, EXTENT OF WORK, INTERIOR PAINTING, ETC., PROVIDED THAT:

"THE WORK HEREUNDER INCLUDES THE PAINTING OF SURFACES OF AREAS WHERE NEW WORK IS INSTALLED UNDER THE BASE BIDS AND THE ALTERNATE BIDS. THE DIVISION LINE OF THE WORK UNDER BIDS IS INDICATED ON THE DRAWINGS.'

SECTION 10-01 F.1. (E) OF THE SPECIFICATION, SCHEDULE FOR INTERIOR PAINTING, PROVIDED FOR REPAIR, CLEANING, AND PAINTING OF SURFACES IN THE ENTIRE ATTIC.

IT IS REPORTED THAT IN FEBRUARY 1964, AFTER WORK HAD COMMENCED, MARKOWITZ WAS VERBALLY REQUESTED TO PREPARE AND SUBMIT A PROPOSAL FOR A CONTRACT CHANGE ORDER, SUBSTITUTING FIRE RETARDANT PAINT IN PLACE OF THE PAINT SPECIFIED FOR USE IN THE ATTIC. BY LETTER DATED MARCH 11, 1964, MARKOWITZ SUBMITTED A PROPOSAL FOR PAINTING "STEEL BEAMS, COLUMNS AND CEILING OF THE ATTIC" WITH FIRE RETARDANT PAINT IN THE AMOUNT OF $9,477.10. ON MARCH 27, 1964, MARKOWITZ'S PROPOSAL WAS ACCEPTED AS CHANGE ORDER NO. 16 ON THE BASIS OF A PRICE TO BE DETERMINED LATER BUT NOT TO EXCEED $9,477.10.

THE RECORD INDICATES THAT SHORTLY AFTER THE WORK COVERED BY CHANGE ORDER 16 COMMENCED, IT WAS NOTED THAT CERTAIN AREAS OF THE ATTIC WERE NOT BEING PAINTED; AND THAT WHEN THE CONTRACT PROVISIONS WERE BROUGHT TO THE ATTENTION OF MARKOWITZ, IT ADVISED THAT AN ERROR HAD BEEN MADE IN THE ORIGINAL BID PRICE AND THAT THE SAME ERROR HAD BEEN MADE IN THE PREPARATION OF THE CHANGE ORDER PROPOSAL. IN A LETTER DATED MAY 13, 1964, MARKOWITZ EXPLAINED THAT THE ORIGINAL BID HAD BEEN PREPARED ON THE INTERPRETATION OF THE SPECIFICATIONS FOR PAINTING THE ATTIC IN AREAS ONLY WHERE NEW EQUIPMENT WAS TO BE INSTALLED RATHER THAN ON THE BASIS OF PAINTING THE ENTIRE ATTIC. MARKOWITZ REQUESTED THAT IT BE PERMITTED TO SUBMIT A CORRECTED CHANGE ORDER PROPOSAL IN THE AMOUNT OF $14,842.30.

BY LETTER DATED OCTOBER 7, 1964, MARKOWITZ SUBMITTED A SIGNED STATEMENT FROM ITS PAINTING SUBCONTRACTOR EXPLAINING HOW THE MISUNDERSTANDING OF THE SPECIFICATIONS HAD ARISEN AND THE SUBCONTRACTOR'S ORIGINAL ESTIMATE SHEET FOR ATTIC PAINTING. IN A STATEMENT DATED SEPTEMBER 25, 1964, THE SUBCONTRACTOR STATED THAT WHEN IT PREPARED THE ORIGINAL ESTIMATE SHEET, IT WAS NOTED THAT DRAWINGS NOS. 27-386 THROUGH 27-390 INDICATED THAT LARGE PORTIONS OF THE ATTIC WERE INCLUDED UNDER THE ALTERNATE BID AND THAT, THEREFORE, THE ESTIMATE WAS BASED ON PAINTING ONLY PORTIONS OF THE ATTIC INCLUDED IN THE BASE BID. IN THAT CONNECTION, IT IS NOTED FROM THE DRAWINGS SUBMITTED HERE THAT DRAWINGS NOS. 27-378, 27-386, 27-387 AND 27- 388 CONTAIN THE FOLLOWING LEGEND:

"ALL WORK EXCEPT THAT INDICATED AS UNDER ALTERNATE BID SHALL BE INCLUDED UNDER BASE BID.'

AN EXAMINATION OF THE SUBCONTRACTOR'S WORKSHEET INDICATES AN ESTIMATE OF 600 GALLONS OF PAINT AT A TOTAL COST OF $8,712. IT IS REPORTED THAT SUBSEQUENT TO THE ACCEPTANCE OF MARKOWITZ'S CHANGE ORDER PROPOSAL WHICH WAS IN THE AMOUNT OF $9,477.10, THE GENERAL SERVICES ADMINISTRATION PREPARED A COST ESTIMATE FOR THE PURPOSE OF EVALUATING MARKOWITZ'S PROPOSED PRICE AND THAT THE ESTIMATE INDICATES THAT THE DIFFERENCE IN COST BETWEEN PAINTING THE ENTIRE ATTIC WITH FLAT PAINT AND PAINTING IT WITH FIRE RETARDANT PAINT WOULD BE $18,523, WHICH IS BASED ON USING 1,200 GALLONS OF PAINT.

IN THE PRESENT CASE MARKOWITZ IS NOT SEEKING RELIEF ON ACCOUNT OF THE ERROR MADE IN ITS ORIGINAL BID BUT ONLY AS TO THE ERROR MADE IN ITS CHANGE ORDER PROPOSAL. IT IS APPARENT FROM THE RECORD THAT IT WAS THE GOVERNMENT'S INTENT TO REIMBURSE MARKOWITZ FOR THE DIFFERENCE IN COST BETWEEN THE FLAT PAINT ORIGINALLY REQUIRED BY THE SPECIFICATIONS AND THE FIRE RETARDANT PAINT REQUIRED BY CHANGE ORDER NO. 16. IN HIS LETTER THE GENERAL COUNSEL STATES THAT IT IS HIS OPINION THAT HAD THERE BEEN TIME, BEFORE ACCEPTANCE OF MARKOWITZ'S CHANGE ORDER PROPOSAL, FOR THE GENERAL SERVICES ADMINISTRATION TO PREPARE THE COST ESTIMATE WHICH WAS LATER PREPARED, THE CONTRACTING OFFICE WOULD HAVE QUESTIONED THE DIFFERENCE BETWEEN THE AMOUNTS STATED IN MARKOWITZ'S CHANGE ORDER PROPOSAL AND THE GOVERNMENT ESTIMATE AND THAT IT WOULD HAVE REQUESTED MARKOWITZ TO VERIFY ITS CHANGE ORDER PROPOSAL.

UNDER THE CIRCUMSTANCES, AND SINCE YOUR GENERAL COUNSEL'S LETTER ADVISES THAT THE PRICE OF $14,842.30 REQUESTED BY MARKOWITZ IS CONSIDERED REASONABLE FOR THE WORK INVOLVED, WE SEE NO OBJECTION TO THE AMENDMENT OF CHANGE ORDER NO. 16 TO PROVIDE FOR A PRICE OF $14,842.30 FOR THE WORK COVERED BY THAT ORDER. A REFERENCE TO THIS DECISION SHOULD BE MADE ON THE AMENDMENT TO THE CHANGE ORDER.

THE DOCUMENTS SUBMITTED WITH THE GENERAL COUNSEL'S LETTER ARE RETURNED, AS REQUESTED.