Thomas M. Leahy, Jr., Chairman
Richard A. Morrison, Member
J. K. Mehan, Member

Appeal of Henry B. Katz Associates
Panel 79-9
September 25, 1979

This timely appeal of Henry B. Katz Associates (Appellant), 33
Westview Road, Short Hills, New Jersey 07078, comes before the
Board following a decision of the Contracting Officer on 4/19/79
that  "The ship dates on the change order (change order 88746-P
of 4/6/79 to purchase order 71739 of 12/29/78) will be applied
for contractual purposes."  This decision responded to a letter
of 4/12/79 from the Appellant in which he stated that "The
extensions that you (Contracting Officer) granted in your letter
of April 6th are not acceptable.  The amendment of Order #71739
that you sent on March 8th is not acceptable."  The decision of
the Board is based upon information contained in the appeal file.


Purchase Order 71739 was issued to Appellant as the successful
bidder to print, manufacture, package and deliver several million
pressure-sensitive (cohesive) bands, ten types.in all, of various
sizes, colors and quantities.  The specifications provided with
the invitation to bid included a requirement to:  "Ship 25% of
each item on or before January 31, 1979.  Ship complete on or
before March 1, 1979" (A.F. 2).  Purchase Order 71739 prescribed
"Date of shipment (of) March 1, 1979," (A.F. 5) and was delivered
to Appellant with some changes to specifications as to color
coding.  The changes were directed by the customer after the
promulgation of invitations to bid (A.F. 28).  The document by
which the changes were directed to Appellant was a hand-ruled and
hand-printed matrix that arrayed item identification against
revised specifications of colors and patterns (A.F. 7, 10).

On 2/16/79 Appellant was afforded the opportunity to show cause
why the contract should not be terminated by the Government for
reason of non-performance by Appellant (A.F. 8).  In reply,
Appellant denied negligence and argued "causes beyond my
(Appellant's) control," and requested a thirty-five day
adjustment of schedule (A.F. 10).

The Contracting Officer, on 4/6/79, issued a change order
granting a lesser adjustment of schedule (A.F. 17).  Appellant's
reply (A.F.  22) that the extension was unacceptable prompted the
final decision of the Contracting Officer (A.F. 24) from which
Appellant makes this appeal, by letter dated 5/16/79 (A.F. 29).

Appellant  maintains  that  no  delivery  prior to  3/1/79 is
called for by the contract.  Moreover, Appellant maintains that
the order as received was not the order that he was invited to
bid on.  Moreover, Appellant maintains that severe weather and
strikes caused delays in delivery to him of paper stock for this
contract, and that efforts to obtain stock from alternate sources
were unsuccessful.

Appellant, for these reasons, requests reversal of the
Contracting Officer's final decision of 4/19/79 that "ship dates
on the change order (of 4/6/79) will be applied for contractual

We conclude that the final decision of the Contracting Officer is
consistent with the facts as reported in the Appeal File, and we
therefore deny the appeal.

Findings of Fact

In addition to those findings of fact which are referenced to the
Appeal File in the foregoing summary, the following findings were
considered in the course of reaching the conclusion that the
appeal should be denied.

Appellant submitted his successful bid on ten separately priced
jackets "as per specifications" (telegram of 12/22/78) and "in
exact accordance with specifications unless exceptions are
specifically noted above" (GPO Form 183, Bid and Acceptance,
dated 12/23/78) (A.F. 3).

The customer agency changed the specifications on 12/20/78, after
invitations to bid had been promulgated, and the Government
Printing Office decided to make the changes at the time of award
to protect the invitation-bid-award schedule (A.F. 26).

Purchase Order 71739 states a "Shipping Date (of) March 1, 1979"
(2 places), as well as "Date of Shipment March 1, 1979" (2
places).  It also states:  "Ship:  Per Specifications" (2
places), and includes under "Description" the provision "In
strict accordance with your Quotation No. 38454 and our
specifications" (A.F. 5).

After the customer requested change of specifications on 12/20
and prior to the request to Appellant to "Show Cause" (A.F. 8),
Mr. Blake, the Government Printing Office printing specialist,
talked with Appellant on 12/21, 12/28, 1/3 (in person), 1/5, 2/6,
2/7 and ''between 12/28 and 1/3" (A.F. 12, 16, 28).

Appellant states  ". . . copy and instructions for the order were
furnished by December 29th, 1978, but the purchase order was not
received until January 2, 1979" (A.F. 10).  Mr. Blake states
"materials" were mailed 12/29/78, and that they were in
Appellant's possession when he visited the Government Printing
Office on 1/3/79 (A.F. 28).

Appellant's order to Georgia-Pacific Corporation (A.F. 10) is
dated 1/10/79 (A.F. 16).  On 1/18/79, Georgia-Pacific Corp.
returned this and other of Appellant's orders because  ". . . Mr.
Russell suggested that we take one step at a time . . ." (A.F.

Georgia-Pacific Corp. (Mr. Russell) states:

"(Appellant) on or about January 2, 1979. . . requested price and
availability of . . . Kraft . . .(I)t appeared reasonable that we
could fill his requirements . . ." (A.F. 18); and

''(Appellant) contacted me prior to his involvement with the
Government Bids. . . (H)e received some favorable commitment that
we would do our level best to meet his requirements . . ." (A.F.

Appellant provides evidence that he was attempting to obtain
paper from sources other than Georgia-Pacific Corp. in January
1979 (A.F. 16, 29).

Change Order 88969-P to Purchase Order 71739 was issued 3/6/79
changing the shipping date to:

"25% of each Item to be shipped by January 31, 1979.  Complete
shipment of the balance to be completed by March 1, 1979'' (A.F.

Discussion and Conclusions

As outlined in the summary above, Appellant bases his appeal on
three separate contentions as to the existence of causes for
adjustment in schedule not recognized by the Contracting Officer
in his final decision:

1) That no delivery prior to 3/1/79 is required by the original

2) that the Government substantially changed the character of the
order after Appellant's bid; that the changes were described
defectively in that they were printed by hand; that ten items
were required under the change rather than three as in the
original specifications; and that these factors caused production
delays; and

3) that severe weather and strikes caused Appellant's paper
source to fail to honor a firm commitment to provide paper, and
the same conditions precluded his obtaining the paper from
alternate sources.

*  *  *

We cannot support Appellant's contention that no delivery prior
to 3/1/79 is required by the original contract.  The Government
was responsible for a clerical error in failing to spell out in
the purchase order the requirement for partial shipment by
1/31/79 that was specified in the invitation to bid and
referenced in the purchase order.  We would make the Government
"make good'' any type of harm to Appellant resulting from that
error, but we perceive no such harm.

Until receipt of the discrepant purchase order on 1/2/79,
Appellant's planning must be viewed as contemplating the partial
shipment specified.  It is possible that Appellant did not notice
the discrepancy.  It is not reported to have been mentioned in
any of the conversations with Mr. Blake from 1/3/79 to 2/7/79,
and on 2/23/79 Appellant acknowledges  "My failure to complete
25% of Purchase Order 71739, Jackets 277-329 thru 277-338 by
January 31st, 1979, was due to the following causes. . . .''  The
language of the purchase order is not raised, even at this date,
nor, in fact at any time prior to receipt of Change Order 88969-

Alternatively, it is possible Appellant did notice the
discrepancy, recognized it as such, and elected to ignore it.
This alternative is also consistent with the letter of 2/23/79
and with Appellant's silence on on the matter in conversations
with Mr. Blake.  Under either of these circumstances, Appellant
has not been harmed by the clerical error of the Government.

There remains the possibility that Appellant noticed the
discrepancy and considered the possibility that the delivery
requirements for the work had changed.  This alternative is
inconsistent with the Appellant's letter of 2/23/79 and his
silence on the matter in conversations with Mr. Blake.

*  *  *

Appellant maintains that his production operations were delayed
on account of the manner in which the change to specifications
required by the customer agency was provided to him.  The change
was not promulgated in accordance with the Government's rules
under Article 2 of U.S. GPO Contract Terms No. 1 (Rev. July 15,
1970) (hereinafter referred to as "Contract Terms").  Any
departure from specifications as bid should have been directed by
change order in writing to the contractor.  Apart from procedure,
however, we do not consider the change that was directed, or its
manner of transmittal to be defective.  In the context of the
original specifications, the changes directed seem clear to us as
laymen.  If Appellant's perception was less clear numerous
occasions for clarification arose. In fact, Appellant and Mr.
Blake indicate separately that the operational problem of solid
ink coverage was resolved perfunctorily through two phone calls.

Appellant's contention that  ". . .the original bid mentioned
nothing about 7 of the 10 items. . ." is not understood.  The
original specifications repeatedly array the ten items for
various purposes including for bidding each item separately, as
Appellant did.

We conclude that the changes to specifications provided at the
time of award were allowable under the terms of the contract,
that they should not have caused delays in performance of the
work, and that the record does not indicate any contention by
Appellant that he required more time on this account until after
the Government raised the possibility of default.

*  *  *

Appellant maintains that he had a firm commitment for paper for
the contract from Georgia-Pacific Corp..  The Contracting Officer
maintains (A.F. 17) that there was not a firm commitment, as
evidenced by correspondence from Georgia-Pacific (A.F. 16).
Appellant cites further correspondence from Georgia-Pacific Corp.
(A.F.  29) as supportive of his contention.  We have considered
also a third Georgia-Pacific Corp. communication (A.F. 11) in
reaching a conclusion on this issue.

The following positions support our conclusion:

1) We find no  requirements in the contract that the contractor
must have obtained a "firm commitment" for raw materials prior to
or after bid or award, as a condition of routine satisfactory
performance.  However, when answerability for non-performance
becomes a consideration, the manner in which the contractor
provided for contingencies becomes a factor in evaluating what
constitute  ". . .unforeseeable causes beyond the control and
without the fault or negligence of the contractor. . .and delays
of a subcontractor due to such causes. . ." (Article 17, Contract

Also, while a commitment obtained prior to bid or award would
clearly defend against any charge of untimeliness, we would
accept a less rigorous standard.  We believe that a contractor
who obtains a valid commitment for raw materials only after
award, but timely relative to required delivery date, should not
be tested on the fact that he bid at a risk from which he
subsequently removed himself if, for reasons beyond his control,
the commitment later is not honored.

2) In our view a supplier's commitment is not "firm" if it is
given subject to unstated conditions that may later be imposed by
the supplier.  Nor is it "firm" unless it specifies or limits
quantities, qualities and times with respect to the supplies that
are the subject of the commitment.  It is not firm unless it
imposes some reasonably definite obligations on the supplier.

3) We read Article 17 of Contract Terms as authorizing the
Contracting Officer to forego penalties and/or damages against
the contractor when delay by a subcontractor results from causes
unforeseeable to the latter.  The consequences of foreseeable
causes of delay by a subcontractor should not concern the

4) Finally, we consider that the requirement of Article 17 of
Contract Terms for the contractor to inform the Contracting
Officer of impending delays, serves purposes beyond maintenance
of performance records.  It enables the Contracting Officer to
act to protect the Government from the consequences of delay, and
it permits the Contracting Officer, as charged in the Article, to
determine whether other sources of supply are available.

We conclude that, whatever the other characteristics of Georgia-
Pacific Corp.'s "commitment" to Appellant, it was quite possibly

We conclude that it was not "firm" by any reasonable standard
that can be tested against the statements of Mrs. Novosad and Mr.

Irrespective of the timeliness and firmness of the commitment, we
do not agree that failure of a lengthy strike to end abruptly is
the kind of "unforeseeable" cause of delay to subcontractor that
is addressed by Article 17 of Contract Terms.

We find no evidence that Appellant informed the Contracting
Officer that delays in deliveries were impending in accordance
with the requirement established by Contract Terms as the basis
of foregoing of otherwise applicable penalties.

With respect to timeliness, we assume that Appellant had in mind
some source of paper when he bid, and Mr. Russell states that
Appellant requested price and availability "(o)n, or about
January 2, 1979" (A.F. 18).  Appellant states he placed an order
by January 10, 1979 (A.F. 10), and by January 18, 1979, at Mr.
Russell's instruction, this order and others were returned (A.F.
11).  If Appellant's order 1612 had been filled promptly, it
would have been timely. We will not address the apparent
contradiction in Mr. Russell's statement that Appellant
"contacted me prior to his involvement with the Government Bids"
(A.F.  29).

With respect to firmness, we find no statement from Georgia-
Pacific Corp. that suggests an obligation on its part.  "(I)t
appeared reasonable that we could fill his requirement. . ."
(A.F. 18) is not a commitment to do so.  ". . .(H)e received some
favorable commitment that we would do our level best to meet his
requirements" (A.F. 29) is noncommittal even when taken out of
context, but it dissolves, as far as obligation is concerned,
when viewed in the light of Mr. Russell's instructions, for
whatever reason, to fill Appellant.s orders one at a time on the
basis of special clearance of each order (A.F. 11).

With respect to delay to a subcontractor due to unforeseeable
causes, we do not consider that the Georgia-Pacific Corp. letters
to the Contracting Officer support this appeal convincingly.  Mr.
Russell (A.F. 18, 29) recounts various operational and weather
conditions in various locations during the period following
Appellant's request for "price and availability'', but provides
no indication of why  the Government should absorb the
consequences of "mill related'' occurrences nor of how and where
and when the weather impacted Appellant's order.  As noted
elsewhere, we reject the otherwise unelaborated contention that
non-termination of a lengthy strike is an unforeseeable cause of

With respect to the requirement to inform the Contracting Officer
of impending delay, we find nothing in the record to show that
the matter of Appellant's delayed receipt of stock was broached
until he replied (A.F. 10) to the "Show Cause" notice (A.F. 8).
The Government was given no opportunity to defend itself from
delay, and for this reason we conclude appellant would be
subject to "penalties and/or damages" (Article 17, Contract
Terms) even if, for instance, a timely, firm commitment for paper
by the Appellant were not honored by his supplier for
unforeseeable causes.