Contract Appeals Board
Office of General Counsel
U.S. Government Printing Office
Appeal of Keuffel & Esser Company

This is an appeal filed on August 7, 1975, by Keuffel & Esser
Company, 20 Whippany Road, Morristown, New Jersey 07960, herein
also referred to as the contractor, under the "Disputes" clause
of the contract, Government Printing Office Program 588-S,
Article 29, U.S. Government Printing Office Contract Terms No. 1,
Rev. July 15, 1970. The Office of the General Counsel is the
Public Printer's duly authorized representative for the
determination of appeals under the "Disputes" clause.

I. Findings of Fact

A.    This case arises out of a contract entered into by the
appellant, Keuffel & Esser Company, and the U.S. Government
Printing Office, herein referred to as the GPO, for the printing
requisitioned from the GPO by the Department of the Navy.

B.    This is a requirements type contract for the services
indicated in the specifications, including the schedule, for the
period stated therein, namely beginning April 1, 1974 and ending
May 31, 1975. The specifications cover the production of
technical manuals for the support of ships. The requirements
include coldtype composition, making negatives, negative storage
and maintenance, offset printing, binding, packing and mailing.

C.    The specifications required the Government through the
ordering agency, the U.S. Navy, to furnish to the contractor for
each order, depending on its requirements, certain material
specified, camera copy, offset negatives, and preprinted ring
binders used on previous orders which the contractor is to clean
up and use when so ordered. In addition, the agreement provided
that the contractor, at the inception of the term contract, must
pickup at a Washington, D.C. location approximately 1,000 pieces
of original artwork for use in illustrations and approximately
25,000 negatives of previously printed Ship Information Books.

D.    Concerning the return of material furnished, the
specifications provide as follows:

"Unless otherwise instructed on individual print orders, all
artwork, reproduction copy for illustrations and fold-ins, and/or
negatives furnished by the Government

must be stored by contractor in his plant and their location
entered in his file. Any furnished material ordered returned is
to be delivered by contractor to:

Navy Publications and Printing Service Office
Systems Command Publication Support Division
Ship Construction and Conversion Publications
  Branch (Code 0742)
Building 157 - 3rd Floor
Washington Navy Yard
Washington, D.C. 20093

"At the termination of this contract, if the contractor is not
the successful bidder for the succeeding contract, he must
prepare for transfer to the new contractor all negatives and
artwork stored in his plant. All such materials must be packaged
in printing sequence, with proper identification markings on
outside of each package. Refer to 'Transfer Procedure' on page

E. Concerning the used ring binders, the specifications provides
in material part the following:

"Multiple Ring Binders: Occasionally a supply of previously used
multiple ring binders, emptied of their contents, will be
supplied by the ordering agency to the contractor for use on this
program. Contractor must receive and store these binders, and
clean and prepare them for reuse when so indicated on individual
print order. The cost of such renovation is to be charged on
individual print orders for the quantity used on that order."
(Emphasis added.)

F. The contractor, Keuffel & Esser Company, was not the
successful bidder for the following year beginning, June l, 1975.
A meeting was convened on April 9, 1975, at the contractor's
Arlington, Virginia office, for the purpose of specifically
aligning the transfer of all Government furnished materials,
including negatives, artwork and binders then in possession of
the contractor. Personnel attending the meeting, included
representatives of the Navy Printing and Publications Service
Management Office, Defense Printing Service, herein referred to
as NPPSMO and DPS, respectively, and the contractor.

G. The contractor, by letter on June 11, 1975, requested full
payment for services performed in preparing the transfer of all
Government furnished materials, including the used multiple ring
binders, pursuant to "specific verbal instructions of the

Government personnel present" at the meeting. The contractor in
his appeal alleges that the used binders were withdrawn from
storage for purposes of reissue, and packed for shipment on skids
with polyethylene skid jackets. In addition, the contractor
states, concurrently with this operation and subsequently as work
in progress was finished, camera copies, artwork and negatives
were packaged for shipment to various shipyards and/or other
designated locations.

H. The contractor prepared and submitted the appropriate billing
form, Code 0742, pursuant to the established procedure for
claiming payment for services performed under GPO Printing
Program 588-S. This was submitted to NPPSMO on June 11, 1975. The
total estimate for all services rendered in connection with the
transition procedure amounted to $57,091.35. The NPPSMO concurred
in approving, certain items as within the contract, but rejected
the claims for payment of the balance, which is the basis of this
appeal. The estimated billing was submitted to the Contracting
Officer, Printing Procurement Division.

The disputed charges based on schedule of prices as invoiced by
the contractor are outlined as follows:

V.f(l)   Clean up GFM and issue      $31,647.50

VI.d(l)   Wrapping or packing
10-20 lbs. each non-classified   508.00

VI.e(l)    Packing 20-40 lbs. container
non-classified   618.00

I.    The final decision of the Contracting Officer disallowing
the $32,773.50 claimed was made on July 8, 1975. The appellant
made a timely appeal under the "Disputes" clause of the contract
on August 8, 1975.

II. Opinion

The initial immediate question in this appeal is the validity of
the appellant's claim for additional compensation based on its
understanding that payment would be made for services performed
to implement the transfer of Government furnished materials based
on the alleged verbal representations by Government personnel
present at the meeting convened at the Arlington, Virginia
premises of the contractor on April 9, 1975. The Government
employee or employees said to have made the representation are
not designated by the appellant in his appeal, either by name or
official title. There is also the question as to whether the
Government employee and/or employees alleged to

have issued "the specific verbal instructions" at the meeting to
the officials representing the contractor had the authority to
bind the Government. The list of Government employees named by
the appellant in his appeal as being present at the meeting does
not reflect the attendance of the GPO contracting officer.

A memorandum for the record prepared by Mr. M. Malinis, Branch
Head, NPPSMO, dated April 11, 1975, an attendee of the April 9,
1975 meeting, summarizes the transactions that took place at that
conference. The memorandum acknowledges that the costs of used
binders received and stored was $1.00 per binder. This memorandum
contains no mention that the contractor was authorized to "clean
up GFM and issue". Likewise, there is no reference in the
memorandum to the charges submitted by the contractor for
services performed (as listed in the line items) in packing for

The written contract between the parties provides, under the
subject of authorization for additional performance, the

"When so directed, the contractor will work in conjunction with
representatives of the agency, other than the Government Printing
Office named above, in matters relating to proofs, arranging
details of schedule, etc., provided that any instructions
received or arrangements made do not conflict with or tend to
alter or amend the terms of this contract in any particular. The
contractor is therefore cautioned not to perform any work not
provided for in the specifications without previous authorization
in writing from the Government Printing Office." (Emphasis

United States Government Contract Terms No. 1, GPO Form 198, is
an integral part of the contract and provides in pertinent part
in Article 2 the following:

"Modification of purchase order.-. . . No change can be made by
the contractor in any provision, term, quantity, cost, or
operation under any order except on written authorization from
the contracting officer. No oral statement of any Person shall be
allowed in any manner or degree to modify or otherwise affect the
terms, conditions, or specifications of the contract . . . .
There shall be no deviations from requirements of these printed
terms of the contract unless specifically set forth in the
invitation to bid or specification." (Emphasis added.)

The line charges in the amount of $31,647.50 listed under "V.f(l)
Clean up GFM and issue" in connection with used multiple ring
binders was not accomplished in compliance with the terms of the

which clearly expresses that the contractor will clean and
prepare them for reissue when "so indicated on individual print
orders." (Emphasis added.) A print order is an individual
memorandum order for each job placed with the contractor. The
print order, when issued, will indicate the quantity to be
produced and any other information pertinent to the particular
issue. No print order was issued by the contracting officer to
renovate for issuance the used binders.

Likewise the line charges of $508.00 for V.d(l) Wrapping or
packing 10-20 lbs. each non-classified and $618.00 for VI.e(l)
Packing 20-40 lbs. container non-classified relate to the
schedules of prices to be paid in packing for mailing and include
the cost of draft envelopes, cushioned shipping bags, shipping
containers, all necessary packing and wrapping material,
attaching a return receipt, and labeling or marking in accordance
with the specifications. It is apparent that the prices quoted
for these items are to properly secure completed print orders for
delivery. The items were already stored in cartons and were ready
for transfer to the new contractor. Under the transfer procedure
specified in the contract, this was an obligation of the
appellant in accordance with the terms of the contract.

Evidence is lacking to support the contention of the appellant
that representations were made to appellant on April 9, 1975, by
Government personnel to so amend the contract itself by "specific
verbal instructions." In any event, in view of legal principles
set forth by the courts, it is unnecessary to resolve any alleged
conflict of evidence.

The contractor alleged that the performance of the services was
based on an oral statement of someone in attendance at the
meeting. There was no contracting officer at the meeting. Even if
the oral statement was made as alleged, it was not made by anyone
clothed with authority. Nor was the action ratified by the
contracting officer in any way. The operative principle has been
stated as follows by the Supreme Court in Federal Crop Insurance
Corporation v. Merrill, 332 U.S. 380 at page 384:

"Whatever the form in which the Government functions, any one
entering into an arrangement with the Government takes the risk
of having accurately ascertained that he who purports to act for
the Government stays within the bounds of his authority."

Although NPPSMO personnel may have been the authorized
representative of the contracting officer for certain stated
limited purposes under the contract such as matters relating to
proofs, and arranging


details of schedule, there is no indication either in the
contract or elsewhere of any authority of NPPSMO personnel,
without written approval of the contracting officer, to so amend
the contract by any verbal instruction. An express caveat is
provided in the contract cautioning the contractor not to perform
any work not provided for in the specifications without previous
authorization in writing from the GPO. The contractor,
experienced in contracting with the GPO, was bound to take notice
of NPPSMO personnel's limited authority, and the GPO is not bound
by their verbal acts and/or instructions with respect to the
claims herein. Moreover, even if it was a written statement of
the NPPSMO it could not modify the contract since only the
contracting officer could modify it. (See Chalker and Lund Co. v.
United States, 123 Ct. C1. 381; Kelly v. United States, 116 Ct.
C1. 811; James A. Parker, AGBCA No. 286 (1970), 70-2 BCA 8569.)

It is therefore concluded for the reasons stated herein that the
finding of the contracting officer should be sustained.

II. Decision

In view of the foregoing the appeal is denied.

Vincent T. McCarthy
Chairman, Contract Appeals Board

Jay E. Eisen
Member, Contract Appeals Board

Robert M. Diamond
Member, Contract Appeals Board
Panel 75-8

December 11, 1975