U. S. Government Printing Office Contract Appeals Board Vincent T. McCarthy, Chairman Lawrence W. Kennelly, Member Drew Spalding, Member Panel 76-18 Appeal of Dynamite Graphics Purchase Order Number 50826 August 31, 1979 Summary This appeal is taken by Dynamite Graphics (hereinafter appellant), 2705 Ross Road, Chevy Chase, Maryland 20015, pursuant to the Disputes clause, Article 29, U.S. Government Printing Office Contract Terms No. 1 (revised July 25, 1970), to a decision of the contracting officer assessing liquidated damages for late delivery. The contract at issue required the screen process printing of 8,000 posters to be used outdoors by the Department of Agriculture. It also required the printing to be done with inks which resisted fading under adverse weather conditions. To comply with this standard, after award, the appellant found it was required to use an ink that took a considerably longer drying period than the ink it had originally intended to use. Appellant maintains this delayed the delivery of the posters for nearly nine months after the original delivery date. The contracting officer thereafter assessed the maximum in liquidated damages (50% of the bid price), as permitted by the contract. Appellant appealed this decision in a timely letter to the Public Printer. Thereafter, it submitted a number of supporting documents and appeared at a formal hearing before this Contract Appeals Board. In addition, through counsel, Robert N. Stokes, Jr., Esq., appellant has argued variously that (1) the contract specifications were defective and impossible of performance, (2) the Government possessed superior knowledge regarding the contract specifications which it failed to disclose, thereby preventing the contractor from performing the work properly, and (3) the liquidated damages provision is unenforceable because it amounted to a penalty. The Government responded by asserting that the contract term prescribing the use of fade resistant inks was widely used in the printing industry, and that the appellant knew that it was not certain of what the term meant and bid on the contract nevertheless. Therefore it must be held to the original delivery date required by the specifications. The Government also argued that the assessment of liquidated damages is perfectly proper in this instance, in view of the delayed delivery date. Based on the evidence contained in the appeal file, the testimony adduced at a hearing held before the Board on September 25-26, 1978, and the pre-hearing and post-hearing filings of counsel for the Government and appellant, our decision is that the appeal of Dynamite Graphics should be denied in its entirety. Findings of Fact In January 1975, the Government Printing Office (GPO) placed the appellant on its bid list for silk screen printing requirements after the appellant had filled out and submitted a questionnaire for the Printing Procurement Department of the GPO. In the questionnaire, appellant listed the equipment it possessed and indicated the type of work it wanted to perform. Silk screen posters were among the manufacturing specialties appellant indicated it could produce. Invitations for bids for the silk screen printing of 8,000 posters entitled "No Fireworks" were mailed to 20 contractors on June 19, 1975. Five bids were opened on July 3, 1975, and the appellant supplied the low bid of $3,689.50. The four higher bids were between $5,440 and $6,600. Because of the wide variance between the appellant's bid and the next low bidder, the contracting officer, through his representative, requested appellant to review the specifications and confirm its bid (TR II, p. 80-81). Appellant responded to this request by letter dated July 8, 1975, signed by Mr. William T. Whipple and Nevet Sydell, co-owners of the appellant company,which confirmed their bid price (AF, Item C, Exh. B). The contract was awarded to appellant on that same date, via Purchase Order No. 50826 and required final delivery on or before August 11, 1975. The contract specifications required screen process printing in two colors (black and red) of posters on weatherproofed blanks. The stock to be used was prescribed as "white 5- to 10-ply (.021" to .036" thick) weatherproofed blanks, similar to All Weather Paper Company's H2OPruf Outdoor Board, or at contractor's option white 5- 10-ply (.021" to .036" thick) C-l-S blanks and weatherproofed after printing" (Appeal File (AF) C-l, p. 1). The other contract terms in issue are as follows: "Subject matter: All line work including a 40% tone area, printing in two colors. Approx. ink coverage 10% red, 5% black. Use FADE and WEATHER RESISTANT INKS. Iron oxide (for the red) pigments are suitable for this purpose. The inks must not show any deliterous [sic] effect that will render the posters illegible when exposed to strong sunlight, heat, or humid conditions, and will not show any appreciable change in color after exposure in an Atlas Fadeometer for 160 standard fading hours or its equivalent. WEATHERPROOFING: Poster (unless weatherproofed blanks are used) must be weatherproofed on the face, back, and edges. These posters will be displayed in outside wooded areas for a minimum period of 60 days. The paper must be as white as possible to allow for discoloration because of the weatherproofing process. The weatherproofing material must not deteriorate the printing inks." (AF, C-1, p. 1) (Emphasis added) Mr. Whipple testified that prior to bidding he did not understand the requirement regarding the use of fade and weather resistant inks. Particularly, he was unclear of what was required by an ink that will not show any appreciable change in color after exposure in an Atlas Fadeometer for 160 standard fading hours or its equivalent" (TR. I, p. 25-26). As a consequence of this uncertainty, Mr. Whipple contended that he made inquiry of GPO personnel in order to get more information regarding the requirement (TR. I, p. 36-38). Although he did not receive a satisfactory answer to his inquiries at that time, he bid for the job on or about July 3, 1975. He explained that although he was not certain as to to the meaning of the specification regarding the fade resistance of the inks to be used, he did understand the requirement in the "Weatherproofing" paragraph (quoted above) which required the poster to be able to be displayed in an outside area for a minimum period of 60 days. At the time he submitted his bid, he simply assumed that the durability of the ink would be sufficient if it lasted the same amount of time as the paper was required to last, i.e., 60 days (TR.I, p. 128-9). Shortly after award, the appellant again became concerned about the ink durability requirement and sought information from other private ink suppliers with expertise on the subject. As a result of these inquiries, appellant decided to use a gloss poster ink with a hardening agent and binding varnish (TR. I, p. 76). This amounted to a change from the ink that the appellant had anticipated using, namely a flat poster screen ink with hardener, which had a much shorter drying time. While at this time the appellant still did not know precisely what 160 standard fading hours meant, it decided it would be sufficient if the ink used could last 160 days (TR. I, p. 134; AF, Item C. Exh. 10). Shipment of the posters was not made on August 11, 1975. On August 26, 1975, the GPO contacted appellant regarding the delay, and appellant informed the GPO that equipment breakdown had caused a delay in delivery (AF, Item C, Exh. 8). Contact was later made with appellant during the week of September 4, 1975, concerning a date when delivery could be anticipated, however, no projected delivery date was obtained from appellant. Final shipment of the posters was made on April 30, 1976, or approximately 8 1/2 months after the originally scheduled delivery date. At no time prior to this had the appellant discussed an extension of the delivery date with the contracting officer. Liquidated damages were assessed by the contracting officer in accordance with Article 19, of U.S. Contract Terms No. 1, Revised July 15, 1970, which was incorporated as part of the contract specifications. This provision permitted (with minor variations not relevant here) a 1% deduction in the contract price, up to maximum of 50%, for each day beyond the contract delivery date that delivery was actually completed. In this case, the maximum deduction was assessed in the amount of $1,844.75 (AF, Item C, Exh. 9). By letter dated October 10, 1976, the appellant wrote to the contracting officer protesting the assessment of liquidated damages. Appellant maintained that the delay in delivery was caused by its extraordinary efforts to meet the contract specifications in that it used an ink which took far longer to dry than the ink that it had anticipated using at the time of its bid. In this letter, appellant also maintained that the GPO was in part responsible for this delay because it should have known that the job could not have been accomplished without automatic dryers. It asserted that the GPO was given notice in the answers it provided in the equipment questionnaire, that it did not have the necessary equipment to perform the job by the date specified in the contract (AF, Item C, Exh. 10, 12). By letter dated November 22, 1976, the contracting officer, Mr. R. E. Goltz, informed the appellant that he had reviewed the assessment of liquidated damages and had decided that it was appropriate. The contracting officer's position was that any contractor has the responsibility of knowing all the elements of the specifications before submitting a bid. He also maintained that no record existed of any inquiry made by the appellant of the GPO regarding the ink durability requirement of the specifications. Appellant appealed this Final Decision in a letter dated December 20, 1976. During the oral hearing before the Board, the Government produced several witnesses who would have been in a position to receive an inquiry from the appellant regarding a particular contract specification. Each of these individuals, namely, William G. Brawner, Specifications Writer in the Printing Procurement Department and author of the specifications at issue; George K. Spicer, a specifications reviewer, who reviewed of the subject specifications; Mr. Joseph Wagner, a printing specialist in the Certifications and Awards Section of the Printing Procurement Department, who was in contact with the appellant company; and Mr. Roman Goltz, contracting officer, testified that they had not been contacted by the appellant company on this matter either prior to bidding or subsequent to award. Appellant disputes the implication of this testimony claiming instead that it called the contracting officer and he and the other persons to whom they spoke at the GPO failed to help them in understanding the Atlas Fadeometer requirement (AF, Item C, Exh. 10; TR. I - p. 26, 40, 182). The only expert testimony received during the hearing regarding the Atlas Fadeometer requirement was produced by the Government through Dr. Albert R. Materazzi, Manager of the Quality Control and Technical Department of the GPO. 1 Dr. Materazzi explained that the Atlas Fadeometer is an instrument used to test accelerated aging of materials. More particularly, it can be used to test the resistance to fading of certain inks, paints, varnishes, etc. (TR. II - p. 43-44). He further testified that it was commonly used within the printing industry and that if a printer wanted to buy an ink that met this specification he would simply go to a knowledgeable printing ink company and that ink company would supply the appropriate ink (TR. II, p. 46, 61). Further evidence was made part of the Appeal File in Items F and G which support the conclusion that the Atlas Fadeometer standard is one that is both meaningful and ascertainable to someone in the printing industry. The appellant specifically disputes this conclusion through extensive testimony in which Mr. Whipple claimed that he contacted numerous ink manufacturers only to be given a variety of definitions and no specific recommendations as to which ink to use (AF, Item E; TR I, p. 41, 58-60, 127). As to this particular issue, the Board finds that there is greater reason to believe the testimony of Dr. Materazzi. He evidenced in his testimony an in-depth knowledge of the meaning of this specification and he was able to demonstrate specifically how a screen printer could ensure itself of using the correct ink to meet the specification. In any event, the appellant apparently used an ink which fully met the specifications as there is no indication on the record that any question was ever raised by the contracting officer regarding the quality of appellant's work. During the hearing, appellant suggested that the specifications for weatherproofing, as compared to the specifications regarding the fade resistance of the inks, are inherently contradictory. It suggests that it is illogical for the contract to require the ink to last longer than the substrate upon which it is placed, i.e., the weatherproofed poster board. That these requirements are different was acknowledged by the testimony of Dr. Materazzi (TR. II, p. 78-79). This difference was explained by testimony provided by other Government witnesses. Mr. Spicer indicated that the Department of Agriculture used the posters for as long as practicable, possibly as long as two or three years (TR. II, p. 23). Mr. Watson, Chief of the Color Specifications Section, testified that the 160 standard fading hour requirement was used because it was much more susceptible of testing than the requirement regarding the ability of the poster to stand in an outside wooded area for a minimum period of 60 days (TR. II, p. 26). However, it was not the weatherproofing requirement which caused the appellant's problems, rather it was the requirement that the inks resist fading. It was the appellant's choice of inks, not the substrate, that caused the delay in delivery. 2 As a result, we focus our attention on this requirement in our discussion below. Discussion In our view, the critical fact in this case is that the appellant knew before it bid that there was a term in the contract which it did not understand. Nevertheless, it proceeded to bid on the contract and thereafter even reviewed and confirmed its bid price. In doing so, it relied on its own interpretation of a totally different clause in the contract and assumed that the specifications as to inks and substrate were synonymous. Only after award, did the appellant discover what it felt to be a more accurate interpretation, which in turn, caused it to change the inks, resulting in the delay in delivery. Apparently, if the appellant had known precisely what the Atlas Fadeometer standard required prior to the bid date, it would have declined to bid on the contract. In its post-hearing submissions, appellant argues that.the contract specifications were defective and impossible of performance. Among other cases, it cites the Board to Foster Wheeler Corp. v. United States, 513 F.2d 588 (Ct. Cl. 1975); Hol-Gar Mfg. Corp. v. United States, 360 F.2d 634 (Ct. Cl. 1966); Kinn Electronic Corp., ASBCA 13526, 69-2 BCA ¶ 8061; and Landsverk Electrometer Co., ASBCA 11092, 67-2 BCA ¶ 6649. Each of these cases concerns a situation where the product or end item to be produced was either unique or beyond the then existing state of the art. In the instant case, quite the contrary is true. There is no evidence in the record that it was objectively impossible to meet the specifications . Indeed, there is no allegation that this contractor did not meet the specifications. The ink which was required was obtainable by any screen process printer, including this contractor. Appellant also asserts that the contract violated an implied warranty that, if followed, the specifications will result in a satisfactory product. It contends the specifications were "not merely inaccurate, but required performance to a standard for which there exists no commonly accepted measure of performance." (Appellant's Brief p. 3) In support of this proposition it quotes a passage from Consolidated Diesel Corporation, ASBCA 10486, 67-2 BCA ¶ 6669, which indicates the extent of the Government's responsibility for its own specifications. We set forth a portion of this quotation: "When one of the parties to a contract undertakes to prepare the specifications, that party is responsible for the correctness, adequacy and feasibility of the specifications, and the other party is under no obligation to check and verify the work product of the party who assumed responsibility for the preparation of the specifications, even though he may be as much or more of an expert than the party who prepared the specifications." (p.30, 951-2) The appellant, however, has failed to quote another portion of that same decision which we find pertinent here. We quote as follows: "A bidder who knows or should have known that the specifications are impossible of performance, but bids anyway without raising any objection to the specifications, cannot thereafter be relieved from the consequences of impossibility, as in bidding with actual or construction [sic] knowledge of the impossibility, he assumes the risk . . . . A bidder who is on notice of an 'incipient problem', but neglects to bring it to the attention of the contracting officer and get it solved before the bid opening, cannot expect to have the problem resolved in his favor." (Citations omitted.) (p. 30,952) We find that this appellant did precisely what this decision proscribes. It assumed the risk when it proceeded to bid without regard to its previously acknowledged lack of information on the meaning of the ink fade resistance specification. The appellant argues alternatively that the Government had superior knowledge of the nature of the performance specification which it failed to disclose to the appellant. Specifically, it contends that the Government knew or should have known that automatic drying equipment was needed to complete the contract within the time frame specified. It claims that because of the answers it provided on the equipment questionnaire prior to bidding, the Government had actual knowledge of what equipment it possessed and of its manufacturing capabilities. It contends, therefore, that the government should have advised it that the delivery date was impossible of performance with its equipment. In support of this proposition, appellant refers us to J. A. Jones Construction Co. v. United States, 390 F.2d 886, 182 Ct. Cl. 615 (1968) and Helene Curtis Industries, Inc. v. United States, 160 Ct. Cl. 437, 312 F.2d. 774 (1963) The rule of the Helene Curtis case is that the Government must share its superior knowledge which is vital to the successful completion of the contract. However, the corollary to this postulate is that the Government is under no duty to volunteer such information, if the contractor can reasonably be expected to obtain the facts from other sources. H. N. Bailey & Associates v. United States, 196 Ct. Cl. 166 at pgs. 177-178; 449 F.2d 376 at p. 382 (1971) and cases cited therein. As we noted above, the appellant here obtained the necessary information from other sources in the private sector. As noted above, the appellant contends that the Government should not have awarded it the contract because of the equipment limitations which the Government knew existed at the contractor's plant. In the few times that Boards have spoken to this rather remarkable argument, they have concluded, as we do, that the contractor, and not the Government, is the best judge of the contractor's ability. See Valveaire, Aircraft Division Abbotwares, ASBCA 8322, 1964 BCA ¶ 4177; Washington Scientific Instruments, Inc., ASBCA 9348, 63-1 BCA ¶ 4743 (1965). Appellant's final claim, presented in its post-hearing brief dated November 9, 1978, is that the liquidated damages provided for in this contract amount to a penalty and ought not be enforced. In support of this position, it contends that because the posters were to be produced with a legend "No Fireworks", the logical inference is they were intended for use in the time period surrounding the Independence Day celebrations of 1976, and since they were delivered in late April, 1976, the Government suffered no actual damages. Appellant does not cite to any other evidence to support this inference, and our review of the record has not revealed any other evidence which would lead to this conclusion. In Bayou Culvert Manufacturing, Inc., AGBCA No. 400, 76-1 BCA ¶ 11796, a case cited by appellant, the Agriculture Board held that "mere allegations alone, without proof, are insufficient bases for allowing a claim against the Government or for setting aside the decision of a contracting officer. There must be probative evidence to support such self-serving allegations." (Citations omitted.) (at p. 56304) They also held that statements contained in briefs do not rise to the level of evidence and therefore are not given.any probative value. (Ibid.) Using the same thinking, we find no persuasive reason to adopt the inference urged upon us by the appellant, due to a lack of any specific evidence on this point. Additional support for our conclusion is contained in a recent case in the Court of Claims which held, contrary to the assertions of the appellant, that liquidated damages are no longer looked upon with judicial disfavor and are generally accepted as a legitimate technique to allocate the consequences of a breach before it occurs. Jennie-O Foods, Inc. v. United States, 217 Ct. Cl. 314, 580 F.2d 400, 412 (1978). The Court also reaffirmed the standards for enforcement of liquidated damages clauses enunciated in Priebe & Sons, Inc. v. United States, 332 U.S. 407 (1947). As that case indicates, if the actual damages suffered are less than the damages contracted for, this is not fatal to a liquidated damages provision. (At p. 411-12) Moreover, Southwest Engineering Co. v. United States, 341 F.2d 998 (8th Cir.), cert. denied, 382 U.S. 891 (1965) holds that in considering whether liquidated damages are appropriate, one examines the situation which existed at the time of the execution of the contract, rather than at some later point in time. In this case the parties freely entered into the contract and were fully aware of the provision for liquidated damages (TR. I, 138). We have reviewed the liquidated damages clause for this particular contract and are unable to find it invalid on its face as a penalty. The clause does not assess damages for delay in contemplation of an intermediate and dependent part of an integrated contract. Schouten Construction Co., FAACAP 1965, 65-1 BCA ¶ 4803. The clause also does not assess a flat rate without any consideration for partial deliveries. Graybar Electric Co., Inc., IBCA 1970, 70-1 BCA ¶ 8121 . In summary, the liquidated damages clause here appears to us to meet the requirements imposed by the cases cited above. We therefore conclude that the liquidated damages clause in the instant contract was and is valid and enforceable. Conclusion For the reasons stated above, and after due consideration of all of the evidence and arguments on the various issues raised, we hereby deny the appeal in its entirety. _______________ 1 The Board received Dr. Materazzi's resume into evidence (Government Exhibit D) and he was examined by appellant's counsel on voir dire regarding his qualifications to testify in this area. (TR II, p. 35-43). The evidence showed he has completed a doctorate in chemistry with a dissertation on bacterial pigments. Since 1937, when he began work as a chemist in private industry doing three-dimensional photographic research, he has held a series of high level positions involved with the technical aspects of printing. Since 1974, he has been the Manager of Quality Control and Technical Department at the GPO, and he recently supervised the production of a technical report by the department regarding light-fast materials (TR II, p. 37; AF, Item F). Based upon these credentials, the Board accepted Dr. Materazzi as an expert witness (TR II, p. 42). 2 Although not raised by either party during the hearing, there is some suggestion in the submissions of the appellant (prior to its representation by counsel) that there were other factors which caused the delay. Specifically, Ms. Sydell and Mr. Whipple, in a letter dated October 10, 1976, to the contracting officer, wrote: "In actual operation, the impact of this change [in inks] required intermittent printing because of the limitation of available drying equipment (air drying). Whereas we formerly planned to execute this job within the time limits prescribed, we found ourselves in the position of having to interrupt even the longer intermittent process to fit in other contracts which included use of the same manual equipment. Additionally, it did take longer than planned to obtain shipment of production materials, including the newly needed glass poster inks. It took longer than the required time allowance just to get 8,000 pieces of weather resistant board from the mills." (AF, Item C, Exh. 10) (Emphasis added). As a general proposition, a contractor is required to have made adequate provisions to obtain the supplies to meet the obligations of a contract. Federal Roofing and Painting, Inc., Eng. BCA 1968, 68-1 BCA ¶ 6912. It appears from the above-quoted passage the appellant failed to some extent to meet this standard.