October 6, 1978

CONTRACT APPEALS BOARD
U. S. GOVERNMENT PRINTING OFFICE
CONTRACT APPEAL OF PIKES PEAK LITHOGRAPHING COMPANY - C.A. 77-7

Findings of Fact

Pikes Peak Lithographing Company (appellant) has appealed a
decision by the contracting officer, Mr. James L. Odlin, that it
reprint an order of maps at its own expense and seeks an
equitable adjustment to cover the cost of this work.1

On August 12, 1976, the Government Printing Office (GPO) awarded
appellant Jacket No. 697-606 for the printing of the Custer
National Forest Visitor's Map, at the price of $7,725 (Govt. Ex.
1).  The maps were to be printed in accordance with detailed
specifications which had been issued to all bidders.  Offset
presswork was required, with black ink only and a 4-color
process.  Specifications, Jacket No. 697-606, at 1 of 6, 3 of 6
(Govt. Ex. 2).  The specifications emphasized that the colors had
to register properly with the black plate, Specifications at 1 of
6, 5 of 6, and gave detailed instructions regarding the strengths
of the various colors, Specifications, at 5 of 6.  They required
that "[t]he final maps [were to] be first-class prints in every
particular."  Specifications, at 5 of 6.

The specifications also instructed the contractor to "[n]otify
the Government Printing Office 48 hours in advance of press time
so that inspection may be made, if disired [sic], by a
representative of the Government."  Specifications, at 6 of 6.
In accordance with this provision, on October 20, 1976, two
Government representatives visited appellant's plant at Colorado
Springs, Colorado.  The representatives, Mr. Lawrence V. Janes
and Mr. Wolfgang Buttenmiller, were both employed by the United
States Department of Agriculture Forest Service, the agency which
had requisitioned the maps.  Mr. Janes and Mr. Buttenmiller
conferred with Scott L. McLeod, appellant's vice president, and
Charles E. Slusser, the company's preparation foreman.

Because of the crucial importance of what transpired at this
inspection, we quote at length from the statements which have
been filed by the individuals involved.

Mr. Scott McLeod's recollection of the incident is contained in
an affidavit dated September 26, 1977.  He states, in pertinent
part:

"5.  In mid-October, 1976, press proofs were run of the Maps
using the standard procedure Pikes Peak has employed on its two-
color presses for all of its government printing jobs involving
four-color maps with red/black road designations.  This normal
procedure is to run the red/ black ink colors first and the
blue/yellow ink colors second.  This procedure insures proper
alignment of the red and black on the roads.

"6.  On October 20, 1976, Mr. Lawrence V. Janes and Mr. Wolfgang
Buttenmiller from the United States Forest Service appeared at
Pikes Peak to inspect the press proofs. . . The two main concerns
expressed by Mr. Janes when he inspected the press proofs were
first, to fit more exactly the red and yellow registration on the
lettering and second, to maintain a very strong yellow color in
the yellow areas.  These instructions are indicated in several of
his notations on the press proofs.  Mr. Janes was aware that
Pikes Peak uses a two-color press and was told that it would be
necessary to use a different printing order to comply with his
instructions.  Specifically, Mr. Janes was told that the color
combinations on the runs would have to be changed to a red/yellow
run and then a blue/black run.  Anyone familiar with the two-
color mechanical printing process used by Pikes Peak would know
that such a change in the printing order would cause inevitable
misalignment of the red and black due to differential stretch of
the paper.  I also believe that anyone familiar with the
mechanical printing process would know that the very strong
yellow requested by Mr. Janes would overload the yellow ink and
cause scumming.  The overloading of yellow ink was responsible
for the variation in the green colors of the Maps.  Mr. Janes was
advised that the final run of the maps would begin the next day,
October 21, 1976 and was told that he could stay and inspect the
Maps coming off the final run.  I felt this inspection was most
advisable due to the variation in our standard procedures which
Mr. Janes had instructed Pikes Peak to use.  At no time did I, or
anyone else employed by Pikes Peak, advise Mr. Janes that there
would be 'no problems' with printing the Maps per his
instructions, since those instructions were contrary to Pikes
Peak's standard procedure developed in over 30 years of printing
maps, and Mr. Janes was informed of this.

"7.  The final run of Maps were [sic] shipped to the Forest
Service on November 1 and 5, 1976."  Affidavit of Scott L. McLeod
at 1-2.

Mr. Charles E. Slusser's affidavit corroborates Mr. McLeod on all
particulars.2

Messrs. Janes and Buttenmiller submitted affidavits to the Board
in response to those submitted by appellant's witnesses.  Mr.
Janes, in an affidavit dated April 17, 1978, gives his version of
the inspection at appellant's plant:

"Paragraph 6.  Mr. Wolfgang Buttenmiller and I inspected the
Custer-Beartooth 1/2-inch map pressproofs at the office of the
Pikes Peak Lithographers in Colorado Springs.  In looking over
the pressproofs, I noticed that the colors (mainly, the green and
yellow) had light and dark areas--as Scott McLeod stated,
'strong' yellow.  This was what we wanted to eliminate, so I
picked some areas that were in between in density and asked that
they hold to this shade throughout the map.  Also, the red was
out of the black road casing.  Scott McLeod states in the
Affidavit that in asking for better registration, they had to
change the color printing order.  I stated verbally and on the
pressproofs that the black and red plates were out of
registration.  I wasn't concerned about the methods they used,
all I wanted was for the job to be done correctly.  My job is to
inspect the maps for conformance with the required
specifications.

"I felt that since I had indicated on the pressproofs my
recommendations, there was no need for me to stay for the final
run.  Scott McLeod had stated that the company had been in
business for about 30 years; and since he had also indicated that
he anticipated no problems in making the corrections, I had no
reason to believe otherwise.  Again I state, Scott McLeod said
that he anticipated no problems in the printing."  Affidavit of
Lawrence V. Janes at 1-2.

Mr. Buttenmiller's affidavit essentially confirms Mr. Janes'
statement.

Mr. Janes had also discussed the inspection tour in a prior
memorandum, dated December 7, 1976 (Govt. Ex. 7).  He makes one
point there that is not reflected in his affidavit:

"I took along the color proofs that we had made up for a
comparison.  Our color proofs reflected perfect registration of
all plates.  In reviewing their press proofs, I noted that the
registration wasn't too bad, and we could live with them as they
were; however, I noted a few corrections that could be made that
would make the registration better."

The maps were shipped by appellant and received at the Forest
Service's warehouse in Missoula, Montana, on November 10, 1976.
On November 11, 1976, a Forest Service printing specialist
notified the GPO Regional Printing Procurement Office in Seattle,
Washington, that there were problems with the finished maps which
could not be overlooked.  (Govt. Ex. 5.) James 0. Odlin, Manager
of the Seattle office, was the contracting officer in charge of
the administration of this jacket.

On November 15, 1976, the Forest Service, pursuant to a request
by the GPO, submitted randomly selected samples of the maps to
the contracting officer.  In an accompanying letter, K. L. Winn,
the Forest Service's Director of Administrative Services at
Missoula, stated that the samples were a fair representation of
the shipment as a whole.  He went on to state:

"The most conspicuous problem was the lack of registration with
red (roads, highways, trail numbers, and road and highway
numbers).  This color never seems to fall into registration close
enough to be acceptable.  There were many other problems which
occurred all too frequently throughout the map.  The colors were
inconsistent, some have bled through, the red is so light in
areas that it is very hard to distinguish road and trail numbers.

   . . .

"We have press proofs copies from the contractor which were
acceptable with a few minor adjustments for better registration
that were to be made.  The contractor agreed to make these
adjustments at that time.  Upon receiving the finished product,
we found they were much worse than the unadjusted press proofs.

"Because of the unacceptability of these maps, we recommend that
they be rejected."  Letter from K. L. Winn to James Odlin,
November 15, 1976 (Govt. Ex. 5).3

Mr. Odlin subsequently called Mr. McLeod concerning these
problems.  At Mr. McLeod's request, Mr. Odlin forwarded samples
of the job.  (Govt. Ex. 18.) On November 24, 1976, Mr. Odlin
again talked with Mr. McLeod, who stated that he did not feel the
quality of the job warranted rejection.  He indicated, however,
that appellant might consider a reduction in price.  (Govt. Ex.
18.)

On December 1, 1976, Mr. Winn once more wrote to Mr. Odlin
concerning what was to be done with the maps.  Mr. Winn objected
vehemently to a reduction in payment to appellant rather than
total rejection of the job:

"The maps are out of register to the extent that public
repercussions can be easily contemplated.  The public has the
right to depend on the accuracy of these maps.  We could be faced
with more than just embarrassment should there be injuries as the
result of public reliance on map information which is totally
inaccurate.

"Again, we strongly object to any degree of acceptance and as the
using agency, recommend the job be rejected.  Adequate maps,
fully meeting specifications, are still urgently needed.  1e hope
you can arrange for printing and delivery at an early date."
Letter from K. L. Winn to James Odlin, December 1, 1976 (Govt.
Ex. 6).

On December 8, 1976, Forest Service representatives visited the
GPO Seattle office for an inspection of random samples of the
maps.  Mr. Odlin reported finding "a very erratic registration on
the red run and a great variation in the yellow run.  Also in the
samples there was some offset and scumming involved."  Memorandum
from James L. Odlin to Contract review Board, March 2, 1977
(Govt. Ex. 18).

This inspection prompted Mr. Odlin to write to appellant on
December 10, 1976, detailing these findings.  He concluded:

"We regret that under the circumstances we have no alternative
but to reject the entire shipment and to request that the maps be
reprinted at no further cost to the Government.  The negatives,
samples, and any other materials required will be returned to you
as soon as we hear from you.  As the Agency is badly in need of
these maps, we would appreciate the earliest possible delivery
date that you could manage."  Letter from James L. Odlin to Pikes
Peak Lithographing Company, December 10, 1976 (Govt. Ex. 8).

On December 15, 1976, Mr. McLeod and Mr. Odlin spoke on the
telephone about the maps.  The only account in the record of this
conversation is found in the contracting officer's memorandum to
the Contract Review Board on March 2, 1977 (Govt. Ex. 18):

"December 15th Mr. McCloud [sic] called to say that he was
surprised that we would reject the job even though he admitted
that the quality was not the best.  He stated that they had never
had any complaints before and that the maps were acceptable by
commercial standards.  I asked him how he could account for the
wide variations in the yellow run.  He stated that the forest
service representitive [sic] (See letter dated December 7, 1976)
had requested that the yellow run be stronger in order to
maintain the green forest areas.  He further stated that in order
to do this it was necessary to 'load' the ink on to keep it dark
and that it was hard to hold the color which accounted for the
faded out yellows.  I couldn't quite get their reasoning there
over using a stronger yellow ink to begin with.  I also asked him
about the high percentage of bad sheets (i.e., scum, offset, bad
register, etc.) and he stated that when the folder operator saw
that they were going to run short he used the press set-up sheets
to fill out the order.

"I asked him if this was a usual practice and he said that he
didn't believe so but that in this case they didn't feel that the
sheets were all that bad.  Apparently these marginal quality maps
are dispersed throughout the shipment.  He asked if the Forest
Service could not sort through these maps and I replied that they
did not have the personnel nor the space to do so and that it was
not their (Forest Service) responsibility to sort through the
maps.  I suggested that Pikes Peak arrange with the Forest
Service for a competent person to be sent from Pikes Peak to go
through and salvage what could be and then rerun the balance.
The alternative was to rerun the entire job for delivery at the
earliest possible date.  Mr. McCloud [sic] said he could discuss
it and send me a letter."

Mr. McLeod's response was sent to Mr. Odlin on December 25, 1976.
After noting that this rejection was the first of a Government
contract in appellant's 28-year history, Mr. McLeod stated that
appellant's position was that it had followed Forest Service's
instructions made at the time of inspection, that a press
inspection would have avoided these difficulties, and that the
maps which had been produced and shipped were "commercially
acceptable".  Letter from Scott R. McLeod to James L. Odlin,
December 25, 1976 at 2 (Govt. Ex. 9).  He concluded by stating
that appellant would not be responsible for reprinting the maps
without payment for work already done.

The receipt of this letter on December 28, 1976, prompted the
contracting officer to contact the Forest Service to ask whether
it was certain that the unacceptable maps were not just a small
percentage of the whole shipment.  (Govt. Ex. 18.) The Forest
Service complied with this request by conducting another
inspection of a "1+ percent sampling taken from each of the 56
boxes of maps."  Letter from K. L. Winn to James Odlin, January
10, 1977 (Govt. Ex. 10).  This inspection confirmed the Forest
Service's opinion of problems with the registration and color on
the maps.  The inspected samples of the maps were forwarded to
the contracting officer (Govt. Ex. 10).  These were received by
the contracting officer on January 19, 1977.  A review by the
contracting officer confirmed the Forest Service's opinion of the
problems with both registration and color.  (Govt. Ex. 18.)

On February 10, 1977, appellant was sent a show cause notice
stating that the maps received on Jacket 697-606 were "totally
unacceptable to the Government because of lack register of the
road fills, consistency in color on the yellow and the red,
scumming, and some offsetting."  Letter from John Tipton, Acting
Manager, GPO Regional Printing Procurement Office to Appellant,
February 10, 1977 (Govt. Ex. 11).  The letter threatened default
if appellant did not notify the GPO within 10 days of receipt of
the notice proposing a schedule for shipping an acceptable
product.  The contracting officer notified the Forest Service of
this action.  (Govt. Ex. 12.)

Appellant responded to the show cause notice through counsel on
February 23, 1977, in the form of an appeal to the Public Printer
(Govt. Ex. 20).  At the same time, by letter to the contracting
officer, appellant agreed to proceed with performance in
accordance with Article 29 of GPO Contract Terms No. 1, an
integral part of this contract.  (Govt. Ex. 17.) The contracting
officer responded by letter of March 16, 1977, confirming that
appellant would proceed as ordered and supplying details
concerning the reprinting.  He reiterated that appellant, in lieu
of reprinting all the maps, had an alternative:

"[A]t your option you may sort the maps you originally shipped,
pick out the defective copies, and reprint the required amount to
complete the total quantity."
Letter from James Odlin to Scott McLeod, March 16, 1977
(Govt. Ex. 14).

Mr. Odlin also called Mr. McLeod on the telephone on March 25,
1977, requesting that appellant respond in writing whether they
would reprint the maps or not.  (Govt. Ex. 16.) Appellant was
further informed that it would be held in default if it were not
to reprint, but that an appeal under the "Disputes" clause was
open to it.  (Govt. Ex. 16.)

Appellant responded to both the March 16, 1977 letter and the
March 29, 1977 telephone conversation through counsel by letter
of March 30, 1977.  (Govt. Ex. 21.) Appellant reiterated its
position that the maps were acceptable and that any defects had
been caused by the instructions of the Forest Service
representatives, but agreed to undertake the reprinting sought by
the contracting officer.  Appellant further advised that Mr.
McLeod would meet with Forest Service officials to inspect the
maps and determine whether any of those already shipped could be
used, which would reduce the quantity that had to be reprinted.
(Govt. Ex. 21.)

On April 1, 1977, Mr. McLeod went to Missoula, Montana, to meet
with Forest Service representatives and to inspect the maps.  Mr.
McLeod selected what he believed to be a representative sample of
the entire shipment of the maps, from the various cartons stored
at the warehouse.  Affidavit of Scott McLeod at 3.4 Mr. McLeod
asserted to the Forest Service employees that at least 80 percent
of the maps were acceptable (Govt. Ex. 22).  While no one from
the Forest Service participated in Mr. McLeod's selection
process, the Forest Service apparently maintained its position
that the entire job was unacceptable.  (Govt. Exs. 23 and 26.)
However, the contracting officer later noted that the Forest
Service had confirmed "30% not usable".  Memorandum from
Contracting Officer to Contract Review Board, March 2, 1977, at 2
(Govt. Ex. 18).5

Appellant subsequently reran the entire order of maps which were
found to be acceptable by the Forest Service.  Affidavit of Scott
McLeod at page 3-4; Letter from James L. Hamilton, Acting
Director, Administrative Services, Forest Service to Contracting
Officer, July 27, 1977 (Govt. Ex. 29.)
Further findings of fact are made in the course of the decision.
Decision
Constructive Change Argument

Appellant makes several arguments in support of its position.
While not acknowledging that the maps produced were defective, or
defective in sufficient quantity to require rejection, appellant
contends that any defects in the map were caused by its
compliance with the instructions of the Government
representatives during the October 1976 inspection.  Appellants
and the Government agree that the problems found by the
Government representatives were in the registration and the lack
of consistency of the colors.  However, this is all they agree
on.

Appellant's position, as evidenced by the affidavits of Messrs.
McLeod and Slusser, quoted previously, is that when the
Government representatives instructed appellant to improve the
registration and color, they were told that this would
necessitate changing the printing order on the run which "would
cause . . . inevitable misalignment of the red and black due to
differential stretch of the paper."  Affidavit of Scott McLeod at
2.  They were also warned, the contractor alleges, that the
increased strength of yellow "requested by Mr. Janes would
overload yellow ink and cause scumming."  Id.

The contractor concludes that these problems were responsible for
the variation in the colors in the final maps.  The affidavits
submitted indicate not only that the Government representatives
were clearly informed of these problems, but that anybody
familiar with the printing process used by Pikes Peak, presumably
including Government technical inspectors, should have been aware
of them without having to be told.

Mr. Janes, in his affidavit, denies that he ordered appellant to
use any particular method to achieve the desired result:

"I wasn't concerned about the methods they used, all I wanted was
for the job to be done correctly.  My job is to inspect the maps
for conformance with the required specifications."  Affidavit of
Lawrence V. Janes at 1.

Mr. Janes emphasizes that Mr. McLeod "indicated that he
anticipated no problems in making the corrections . . . ."
Affidavit of Lawrence V. Janes at 2.  Mr. Buttenmiller
corroborates this impression.  Affidavit of Wolfgang Buttenmiller
at 2.

Both sides agree that the finished products were inferior to the
press proofs inspected in October.  Furthermore, it is
appellant's contention, essentially uncontradicted, that the
eventual reprint of the maps, found acceptable by the Government,
was done in the manner originally intended without the
improvements ordered by Mr. Janes and Mr. Buttenmiller.6

Without using the term (and without citing cases on this point),
appellant essentially is arguing that any defects in the original
shipment of maps were due to a constructive change ordered by the
Government representatives during the inspection, which requires
an equitable adjustment to cover the additional costs incurred by
the contractor.

The constructive change doctrine is easily defined:

"[W]here . . . the contracting officer, without issuing a formal
change order, requires the contractor to perform work or to
utilize materials which the contractor regards as being beyond
the requirements of the pertinent specifications or drawings, the
contractor may elect to treat the contracting officer's directive
as a constructive change order and prosecute a claim for an
equitable adjustment under the 'changes' provision of the
contract."  Ets-Hokin Corporation v. United States, 190 Ct. Cl.
668, 674-75, 420 F.2d 716, 720 (1970) (citation of numerous
authorities omitted).

The legal basis for a constructive change under this contract
should be mentioned.  While the operative clauses in GPO Contract
Terms No. 1 are somewhat at variance with the standard clause,
See 41 CFR  1-7.102-2 (1976), we think that the same concept
applies.  Though Article 2 on its face limits changes to those
made with advance written authorization by the contracting
officer, the courts have not permitted the requirement of a
writing in such clauses to lead to unjust results.7  It is true
that Article 2 is perhaps more emphatic in its insistence on a
writing than its FPR counterpart.  However, Article 24 of Terms
No. 1 clearly indicates that the contract contemplates
constructive changes as well.  It provides that variations from
the specifications not meeting the definition of change orders
may be submitted as claims by the contractor.  While the article
indicates that such a claim should be processed through the
General Accounting Office,8 we see no reason why one cannot be
treated as a dispute by the contractor and the Government and
thus be decided by the Board.  See generally General Dynamics
Corporation v. United States, 558 F.2d 985 (Ct. Cl. 1977).

We must also consider whether the Government's representatives
were authorized to make what amounted to contractual changes,
since the contracting officer was not involved in the
transaction.  A recent statement by the Court of Claims, in a
somewhat different context, sheds light on this issue:

"To be taken into account the oral assurances by federal
personnel on which [a private individual] relies must not have
been spoken beyond the authority of those who spoke them.  See
Richards & Associates v. United States, 177 Ct. Cl. 1037, 1051
(1966).  But this authority need not be express; it may be
implied from the scope of the work delegated to the official or
employee, as well as the level and nature of his activities.
See, e.g., Centre Mfg. Co. v. United States, 392 F.2d 229, 236,
183 Ct. Cl. 115, 127-28 (1968) (plurality opinion)."

Julius Goldman's Egg City v. United States. 556 F.2d 1096, 1103
(Ct. Cl. 1977).  We believe that these technical representatives
had at least implied authority to make representations concerning
technical issues.  It is not uncommon for a technical
representative to bind the Government by statements to
contractors concerning matters within their area of expertise.
E.g., Max Drill, Inc. v. United States, 192 Ct. Cl. 608, 427 F.2d
1233 (1970); Martin Glisson, ASBCA 15748, 17549, 71-2 BCA  9017
(1971); See generally Newman, Constructive Changes, 9 Nat. Cont.
Mgt. J. 44, 55-56, reprinted at 13 Y.P.A. 1137, 150-51 (1976).
Under these circumstances, at least, under these operative
contract terms, the Forest Service's inspectors had authority to
bind the contracting officer by their representations on
technical matters.

Mr. Janes' December 7 memorandum does indicate that the press
proofs, at least as far as the registration was concerned (the
memorandum is less clear with respect to color density), met the
contract specifications.  Requiring a higher level of workmanship
than that called for by the specifications is clearly a
constructive change.  See, e.g., Ets-Hokin v. United States,
supra.

It does not, however, follow that appellant is entitled to the
equitable adjustment it is seeking for the cost of rerunning all
of the maps.  An equitable adjustment is allowed only for costs
incurred due to the contractual change.

Appellant here incurred the costs of changing the proofs to
accommodate Mr. Janes' instructions, certainly.  The instructions
were not, however, the proximate cause of the map defects.  These
resulted, as Mr. McLeod indicates, from problems with the
printing process.

The responsibility for the mechanical defects would be the
contractor's, unless the Government representatives were fully
advised of the potential impact of their directions.  To decide
this, we must first decide what exactly transpired at the
inspection.

The issue boils down to a test of credibility.  At the outset, we
note that the contractor seeking an equitable adjustment has the
burden of persuasion and must prove its claim by a preponderance
of the evidence.  E.g., Mann Construction Co., Inc., supra at
55,829; EG & G, Inc., ASBCA 14051, 71-1 BCA  8867 (1971) at
41,219.

Neither side requested a hearing in this matter, so that the
Board is forced to resolve the conflict in testimony only by an
evaluation of the record.  Careful examination of the record has
been sufficient to convince us that appellant has not met its
burden and that we are constrained to resolve this issue in favor
of the Government.  The position of neither party is inherently
incredible.  It is significant, however, that though appellant's
representatives allegedly protested vehemently when they received
the instructions in question, they never bothered to contact the
contracting officer about the situation.  In this context, we
note that appellant admits to having substantial Government
procurement experience, Affidavit of Scott L. McLeod at 1, and
thus would have every reason to know of this recourse.  No reason
is advanced why such notice was impossible or impractical.  There
were still approximately 10 days before the requested delivery
date for this jacket, Printing and Binding Requisition, Jacket
No. 697-606, June 28, 1976 (Govt. Ex. 4); appellant was therefore
not pressed for time.  Surely appellant had the obligation to
take this dispute immediately to a higher level if it knew that
the quality of the job was at stake.

Even without this reasoning, there is no basis for the Board to
find that appellant's version of what transpired at the
inspection is more probable than the Government's.  We believe
that the evidence presented, therefore, gives us only a choice
between two relative possibilities.  In such a case, it appears
that the party with the burden of proof fails to sustain it.  See
Mann Construction Co., Inc., supra at 55,830; Conco Engineering
Works, Inc., ASBCA 12997, 13655, 71-1 BCA  8823 (1971) (on
motion for reconsideration) at 41,019.

We therefore find that the Government representatives ordered
certain changes to be made to improve the registration and color
density, but did not specify a particular method in which to
accomplish this.  We further find that appellant's agents assured
the Government representatives that no problems were presented in
these orders, or at least did not voice concern that there might
be any.  Having made this determination, we must also find no
negligence on the part of the Government representatives in
failing to stay for the press run, since they were under the
impression, due to the representations or lack of representations
by Mr. McLeod, that no problems were anticipated.

We hold that a constructive change was ordered in the contract
during the October inspection, but that appellant is only
entitled to an equitable adjustment for costs incurred, if any,
in accommodating the instructions of the Government
representatives.  Appellant is not entitled to an equitable
adjustment for the costs

of reprinting the maps, as we hold that the reprinting was
necessitated by errors for which appellant is responsible.

Substantial Performance

Appellant next argues that all of the maps, or at least a
substantial majority of them, complied with the contract
requirements.

As to the first point, appellant has not made a sufficient
showing to convince us that all the maps produced under the
jacket met the specifications.  In support of its position,
appellant puts forth the affidavit of Mr. McLeod, asserting this
to be fact and submits what it maintains is a representative
sample of the maps.  Mr. McLeod's assertions can not overcome the
contrary view of both the GPO and Forest Service employees who
also conducted inspections of the maps.  Furthermore, the Board
does not have the capacity to evaluate these maps from the
standpoint of whether they met the contract specifications
without the aid of expert testimony.  To the extent we have
examined these maps, there appear to be problems at least with
the registration that could well call for their rejection.

We must then deal with appellant's substantial performance
argument.  This is based on the Government's early suggestion
that the job should be accepted with a 15 to 20 percent reduction
in payment, from which it is inferred that the Government had
found 80 to 85 percent of the maps conforming (Govt. Ex. 6).  It
is also supported by the contracting officer's, indication that
the Forest Service had found that only 30 percent of the maps
were not "usable".  While we do not think this paints as clear a
picture as appellant suggests, See Appellant's Memorandum at 5-6,
we do think this evidence indicates that a number of the maps did
conform to the specifications.

To analyze this situation, we start off with the proposition that
"the Government is entitled to strict compliance with contract
plans and specifications simply as a usual contract right."
Polyphase Contracting Corporation, ASBCA 11787, 68-1 BCA  6759
(1968) at 31,259 (citing numerous authorities).

Appellant contends, however, that Board decisions have held that
the Government is not permitted to terminate or default if the
contractor "has substantially performed the contract in
accordance with the specifications."  Appellant's Memorandum at
4.  While this may be true, the cases cited by appellant involved
facts very different from those present here.  In Conway Electric
Company, ASBCA 4570, 60-2 BCA  2782 (1960), the Board does
mention in its opinion that in spite of defects in the product,
the contractor had substantially complied with the contract.
However, the errors there were mostly of a cosmetic nature or
were such that they could be corrected easily.  More important,
the Board stressed that "it is impossible to say whether errors
later found in [the work] were those of appellant or the
Government."  60-2 BCA  2782 at 14,269.  In the present case, we
have already held that the errors were the responsibility of the
contractor rather than Government.  In Miller's Ambulance
Service, VACAB 548, 67-1 BCA  6274 (1967), the Board found that
there had been seven failures to deliver ambulance service out of
over 400 requests for service.  Not only is the approximately 99
percent success rate much higher than that inferred here, but
also that case stressed that it was dealing with a service rather
than a supply contract:

"It should . . . be borne in mind that this is a contract for
continuing services, possibly several in a day.  This is opposed
to a construction or material contract wherein the contract
requirements are specific, definite, and certain."  67-1 BCA 
6274 at 29,037.

Appellant's third cited case, Shreveport Laundries, Inc., ASBCA
3037, 56-2 BCA  1008 (1956). also involved a service contract
and a higher success rate than the one we are postulating here.

It is also important to note that the doctrine of substantial
performance, as enunciated by the Court of Claims in Radiation
Technology, Inc. v. United States, 177 Ct. Cl. 227, 366 F.2d 1003
(1966), does not require the Government to accept goods not
conforming to contract specifications.  Rather, the doctrine
provides that a "contractor is entitled to a reasonable period in
which to cure a non-conformity provided that the supplies shipped
are in substantial conformity with contract specifications."
Radiation Technology, Inc. v. United States, 177 Ct. Cl. 227,
232, 366 F.2d 1003, 1006 (1966); See also Kessel Kitchen
Equipment Co.. Inc., ASBCA 21080, 77-2 BCA  12,565 (1977).  Even
if we held that Pikes Peak had shipped supplies in substantial
conformity with the contract, the record reveals that it was
granted a reasonable period in which to cure the non-conforming
product but failed to take advantage of this.  In his letter of
March 16, 1977, the contracting officer informed appellant that
it would be required to reprint the maps, "or at your option you
may sort the maps you originally shipped, pick out the defective
copies, and reprint the required amount to complete the total
quantity."  (Govt. Ex. 14.) This offer was repeated in Mr.
Odlin's letter of May 2, 1977 (Govt. Ex. 27).  Appellant
apparently did not take advantage of this but contended that it
had supplied an acceptable product, and reran the entire
shipment.

We hold that appellant did not provide an acceptable product even
though given an opportunity to cure defects in its original
shipment of maps and is not entitled to an equitable adjustment
on this basis.

Waiver of Notice

Appellant makes several other related arguments which we can
dispose of briefly.

First, appellant argues that the Government's intent, as
evidenced by the conduct of its inspectors, was "that it was
willing to accept the maps despite the problems about which it
had been warned."  Appellant's Memorandum at 9.  We reject any
notion that the GPO was estopped from rejecting the maps on this
basis, since we have found that it had not been warned of the
possible problems in making the necessary corrections.  Nor did
it indicate at any time that the maps met the contract terms.

Appellant also contends that the Government unreasonably delayed
its inspection and eventual rejection of the maps and should be
found liable on that basis.9  While we agree with appellant's
statement of the law, there is no showing that the Government
unreasonably delayed on either count in this case.  The maps were
shipped in early November and received by the Forest Service on
November 10, 1976.  Mr. McLeod was notified by Mr. Odlin that
there were problems with the maps and that rejection was a
possibility by November 24, 1976, if not earlier.  After
consulting with the Forest Service and conducting his own
inspection of random samples of the maps, Mr. Odlin wrote to
appellant on December 10, 1976, stating that the entire shipment
would be rejected.

Thus, the initial time lapse between the receipt of the job and
the first written notification of rejection was a period of
approximately 5 weeks.  The subsequent delay was caused by
further inspection at appellant's request, and by negotiation
between the parties concerning how to deal with the situation.
We cannot hold that the 5-week delay was inherently unreasonable,
especially in light of the fact that two different Government
agencies at different locations were involved and that appellant
was informally notified as soon as it became apparent that the
maps were defective.

An examination of the cases cited by appellant shows them to be
inapposite.  For example, in 42nd Street Fotoshop, Inc. v. United
States, 137 F. Supp. 313 (S.D.N.Y. 1955), which appellant
primarily relies on, the contractor delivered the goods to the
Government on February 1, 1950.  While a Government
representative indicated possible problems with samples of the
goods shortly thereafter, appellant was not notified of their
rejection until June.  There had been no negotiation, indeed no
contact between the contracting officer and appellant between the
delivery in February and June when appellant requested payment.
Under these circumstances, the court held that a delay in
notification of rejection of more than 5 months was unreasonable.
Moreover, the Government had not even bothered to forward the
materials to an expert until several months past delivery.  This
is simply not comparable with the case we have here, where the
inspection process began immediately and the contractor was kept
notified of exactly what was happening.

It is also obvious that the Government never led appellant to
believe that the product was acceptable, and thus did not waive
its right to reject after inspection.  See, e.g., Midwest
Engineering & Construction Co., ASBCA 5390, 1962 BCA  3460; Nash
& Cibinic Federal Procurement Law (2nd ed. 1969) at 671-672
(collecting cases).10

Conclusion

In light of the foregoing, we hold that appellant is not entitled
to an equitable adjustment for the reprinting of maps on Jacket
No. 697-606.  Appellant is entitled to an equitable adjustment
for any costs incurred in making the changes indicated by the
Government on the press proofs.  The appeal is sustained to this
extent, and in all other respects denied.11



VINCENT T. McCARTHY
Chairman, Contract Appeals Board


SAMUEL SOOPPER
Member, Contract Appeals Board


JAY E. EISEN
Member, Contract Appeals Board

_______________

    1The record reveals that there was technically no final
    decision by the contracting officer.  The positions of the
    parties are fully crystallized, however, and no purpose would
    be served in sending the case back to the contracting officer
    for a formality.  E.g., Conrad, Inc., ASBCA 14239 70-1 BCA
    8116 (1970).

    2Mr. Slusser also states that "problems with fit were
    inevitable, since the negatives supplied by the Government
    were imperfect and failed to exactly align."  Affidavit of
    Charles E. Slusser at 2.  Appellant does not develop the
    point beyond this mere allegation, and we thus do not find it
    material to the appeal.

    3Mr. Winn also alludes to problems with the paper stock used
    and the packaging of the maps for shipment.  These
    allegations were not given as reasons for rejection of the
    maps and are thus not relevant to the appeal.

    4The maps pulled by Mr. McLeod were subsequently submitted to
    the Board in support of this appeal.

    5The notation is dated March 8, and is apparently made by the
    contracting officer's assistant.  The Forest Service
    continued to maintain, however, that 100% of the maps
    actually inspected were unusable.  (Govt. Ex. 15.)

    6Mr. Janes alleges that the second, satisfactory run of the
    maps was done on a different press than the first run.  This
    statement is not substantiated in the record and we disregard
    it.

    7Without extensive historical discussion, we note that the
    current FPR clause clearly contemplates equitable adjustments
    for constructive changes.  Even under the prior clause,
    however, when there was no such explicit language, equitable
    adjustments were granted under like circumstances.  See
    generally Nash & Cibinic Federal Procurement Law, 521, 534-40
    (2nd. Ed. 1969).

    8We suspect that this clause is not of recent vintage since
    it fails to take into account the diminished role of the
    General Accounting Office in the area of contract
    interpretation caused by the Supreme Court's ruling in S & E
    Contractors, Inc. v. United States, 406 U.S. 1 (1972).  For
    the Comptroller General's view of this role, See 56 Comp.
    Gen. 340, 342-43 (1977).

    9Appellant discusses the delay of notice in terms of breach
    of contract, which is of course beyond our jurisdiction,
    United States v. Utah Construction and Mining Co., 384 U.S.
    394 (1966).  However, we believe that this matter is
    essentially a dispute arising under Article 13 of U.S. GPO
    Contract Terms No. 1 and cognizable by the Board on that
    basis.

    10Of course, since we have held that the Government
    representatives were not negligent in failing to inspect the
    press run, no waiver can be found from this action.

    11We note that there is mention in the appeal file of
    possible assessment of liquidated damages against appellant.
    We need not decide the issue at this time.  Appellant is not
    foreclosed from appealing from any such future assessment.