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UNITED STATES v. SABIN METAL CORP.

June 4, 1957

UNITED STATES of America, Plaintiff,
v.
SABIN METAL CORPORATION, Defendant



The opinion of the court was delivered by: LEVET

The United States of America, the plaintiff herein, is suing the defendant, Sabin Metal Corporation, for damages of $ 7,045.39, plus interest from May 12, 1950, as a result of defendant's alleged breach of a contract to purchase salvage scrap metal from it. The case was heard by the court without a jury.

Findings of Fact

 1. On March 22, 1950, the government's Contracting Officer of the 831st Air Force Specialized Depot at Shelby, Ohio, issued invitations for bids to purchase an estimated 13,359 pounds of assorted scrap Allison engine parts containing steel and silver.

 2. Among the items offered for sale were:

 '(Scrapped Allison Engine Parts containing steel and silver. Material packed in original manufacturer's pack.)

 '1259 ea Connecting Rods, containing silver lined bearing. Approx. net wt. 8499 lbs.'

 3. Bids upon this scrap metal were invited, subject to a number of conditions which were set forth in the invitation as part of any contract for the purchase of the scrap. The following conditions were announced:

 '5. Inspection. Bidders are invited and urged to inspect the property to be sold prior to submitting bids. Property will be available for inspection at the times specified in the invitation. No labor will be furnished for such purpose. In no case will failure to inspect be considered ground for a claim.

 '6. Sale of Property 'As Is.' Unless otherwise specified, all property is sold 'as is;' the Government makes no guaranty, warranty, or representation express or implied, as to the kind, size, weight, quality, character, description or condition of any of the property, or its fitness for any use or purpose; this is not a sale by sample.

 '7. Sale of Property 'Where Is:' Delivery. Unless otherwise specified the property is sold 'where is,' delivery shall be at the present location of the property, and removal shall be accomplished by the Purchaser at its expense; unless the Purchaser removes the property from such location within 10 days (or such other time as may be specified herein) after the date of the Government's Acceptance, the Government shall have the right to dispose of the property and hold the Purchaser responsible for any loss incurred by the Government as a result of the failure to pay for or remove the property; the time of removal, and such other details of removal as may not be provided for herein, shall be arranged with the Contracting Officer. Unless otherwise specified herein, payment in full must be made prior to removal of any property or immediately subsequent to weighing if weighing is necessary pursuant to General Provision 9.

 '8. Adjustment for Variation in Quantity. As to any item for which a price per unit is specified in the Schedule of Property to be Sold, the Purchaser agrees to accept and pay at the quoted unit price for any number of units delivered or offered for delivery by the Government up to and including twenty-five per cent (25%) more or less than the estimated quantity stated in the schedule.

 '9. Weighing. Where weighing is necessary to determine price hereunder, the Purchaser shall arrange for, and pay all expenses of weighing material, whether removal is by truck or by rail, including all switching charges incurred. In case of removal by truck, weighing shall be on (a) Government scales, or (b) other certified scales in the vicinity of present location or (c) certified scales in the vicinity of Purchaser's establishment, at the option of the Contracting Officer, and under his supervision. When removal is by rail, weighing shall be on railroad track scales or by other means acceptable to railroad for freight charge purposes. The weights thus determined shall govern payment.

 '10. Responsibility for Property Sold. The Purchaser assumes all responsibility and liability for the property after the date of the Government's Acceptance. The Government will exercise its usual care for protection of the property up to the time limit of removal, but will not be responsible for any loss or damage from any cause whatsoever.' (Exhibit 1)

 4. The defendant, Sabin Metal Corporation, by its president Samuel Sabin, an experienced buyer of scrap metal and a licensed silver dealer, inspected the property before making its bid.

 5. Bids on 13,359 pounds of scrap metal were opened on April 20, 1950. They varied from a low bid of $ 337.28 to a high of $ 9,351.30, which was the defendant's bid at a unit price of 70 cents per pound. The second highest bid was $ 4,642.87. (Exhibit 2)

 6. Major Irving C. Hindenburg of the Air Force, Staff Installation Engineer Officer, Supervisor of Air Force Contracts, in charge of sales of surplus property, who was present at the bid opening, took no special note of the variation except that the defendant's was the high bid. In his opinion there appeared nothing unusual in the variation of the salvage contracts since there was no way of estimating the value of this material. There was no upset price and no way of predicting the bids because the intended use by the bidder might affect the amount of the bid and because bids on salvage sales varied greatly.

 7. On May 1, 1950, the Contracting Officer mailed a letter to the defendant notifying it that its bid of $ 9,351.30 (or 70 cents per pound) had been accepted and that under the contract it was required to remove the material ...


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