March 16, 1972 installation may be made by the Government or others with the costs thereof to be borne by the contractor. We note that this modification is to that portion of the Inspection Clause concerning the Government's rights prior to acceptance and that the modification does not define any category of defects for which appellant is responsible that would enlarge upon the exceptions made in Paragraph 5(d) of the Inspection Clause. Reading this added paragraph together with the rest of the contract, it can only have application to the correction of defects for which appellant is responsible. Had there been a conditional acceptance because of certain defects discovered during testing, or had a latent defect been discovered after installation, this paragraph may have become operative. The Government also relies upon the following Paragraph A-3 to justify its actions: A-3. Right to Operate and Use Unsatisfactory Materials or Equipment. If, after installation, the operation or use of the materials or equipment proves to be unsatisfactory to the contracting officer, the Government shall have the right to operate and use such materials or equipment until they can be taken out of service, without injury to the Government, for correction of defects, errors, or omissions and/or for replacement of unsatisfactory equipment in whole or in part, if correction is unsuccessful or infeasible. Unless otherwise agreed upon in advance, the period of such operation or use, pending correction of defects, will not exceed 1 year. Clearly, this provision contemplates that the operation and use of the equipment, after installation, may prove the equipment to be "unsatisfactory" to the contracting officer. However, the purpose of the provision as disclosed by its title and the right reserved therein to the Government is to provide a safeguard against an unscheduled termination of the system operation for the correction of defects. The term "unsatisfactory equipment” appears to be used to describe equipment found after installation to require "correction of defects, errors or omissions," and not to add a requirement that the equipment shall operate to the satisfaction of the contracting officer. Any other interpretation seems unwarranted in the presence of detailed technical specifications in a simple supply contract. Having accepted the equipment after test and inspection at the appellant's plant, the right of the contracting officer to find, after installation, the equipment to be unsatisfactory must be limited by the prior act of acceptance. Only by inference does Paragraph A-3 deal with the contractor's post acceptance obligations. It does not expressly add to those obligations. Construing the provisions of Paragraph A-3 and Paragraph 5(d) of the Inspection Article together, we find that the defects referred to in Paragraph A-3 are those defects not discoverable by the methods of inspection customarily employed, i.e., those which survive the final acceptance. While the Government has not specifically alleged that a latent de fect existed, we turn to a consideration of whether, in fact, any defect in the equipment is shown to have existed. The March 9, 1971 letter, giving notice of the partial default termination action gave us as the basis for the action, the failure of the TAP-68 equipment to operate satisfactorily as required by Paragraph D-1.a of the Technical Requirements. The reference Paragraph D-1.a reads in pertinent part: D-1. General. a. Under this solicitation, the contractor shall furnish mounted and unmounted load and frequency control and telemetering equipment for the Parker-Davis Transmission System of Region 3. The equipment shall work satisfactorily with existing load and frequency control telemetering equipment which was purchased from Leeds and Northrup Company under Invitation No. DS-5963 and other invitations. That the Government was not content with the operation of the equipment is clear. However, it is less clear from the record in what respect, if any, the TAP-68 equipment failed to conform to the speci fications. The record shows that the primary difficulty was that electrical disturbances were being impressed upon incoming signal circuits. Further, the source of these disturbances was traced to equipment not manufactured by Leeds and Northrup,22 and not a part of the Parker-Davis Transmission System. In a letter dated June 4, 1970, from the Parker-Davis project manager for the Bureau to his 22 Government Responses to Interrogatories dated December 20, 1971. chief engineer,23 a detailed review of the problem is presented. Relevant excerpts of the project manager's statements are: *** We found that there are spikes on both the A.C. supply and on the millivolt inputs which cause the trouble. We tried an isolation transformer in the A.C. supply and capacitors on each millivolt lead, connected to the ground mat. *** *** These spikes are generated by various items at both Mead Substation and Hoover Powerplant. At Mead, we found the Xerox machine and alarm bells create the most spikes and at Hoover, the "code call" causes bad spiking. * * We found that one wire of the existing interconnected cable has more induced A.C. voltage on it than the Universal equipment can tolerate. *** On N8 T.C., which is on the Nevada side of the powerhouse, two control cable wires carry the millivolts to the control room. These wires have very little induced A.C. and the U.E.S. oscillator (TAP-68) operates fairly well; in fact, it is the most stable U.E.S. oscillator we have. The specification called for the Government to furnish the power quired to meet certain accuracy resupply circuits.24 Appellant was requirements under specified voltage variation conditions.25 We find that 23 Government's Brief, Exhibit 3. 24 Paragraph C-8, Technical Requirements. 25 "C-11. Telemetering Equipment, Accuracy and Speed of Response. "a. Accuracy.-Each telemeter instrument, as required by this solicitation, shall have an overall guaranteed accuracy over its full operating range as stated below. The maximum error shall not be exceeded under the most adverse combination of voltage variations of plus or minus 5 percent, frequency variations of plus or minus 0.1 of one (1) cycle from 60 cycles, and ambient temperature variations of plus or minus 15° from 25°C. Each instrument shall hold its calibration so that recalibration will not be required at unduly short intervals, under normal and reasonable service to meet the foregoing accuracy limits. March 16, 1972 the equipment met these requirements. The appellant conducted the required pre-shipment testing with a Government representative present. The test reports are not in evidence; however, appellant's affirmation that such testing showed conformance to specifications is not challenged. The record shows that both parties recognized the problem to be excessive electrical disturbances on the supply line caused by equipment outside the transmission system. Appellant promptly denied the claim that the TAP-68 was deficient. He pointed out this external source of the problem, and thereafter his voluntary efforts to improve performance of the TAP-68 cannot be taken as an admission the equipment was defective. Department counsel directs our attention to two cases, William F. Klingensmith, Inc., IBCA-717-568 and IBCA-734-10-68 (May 4, 1971), 71-1 BCA par. 8842 and Randam Electronics, Inc., ASBCA No. 9006 (April 27, 1964), 1964 BCA par. 4207, in which default terminations were found to be proper. The cited cases involved a rejection of the supplies or contract work, however, for failure to comply with a specific contract requirement. In the instant case, the Government has not pointed out, nor is the Board able to find, any specific contract requirement that appellant's equipment failed to meet. Appellant was required to design and manufacture his equipment so that it would work satisfactorily with other equipment in the trans mission system, namely, the Leeds and Northrup components. Presumably, the specification data on these components was available to appellant to permit him to comply with the standard.26 However, the specifications do not state the extent to which unwanted electrical noise must be suppressed or screened out except that certain accuracies must be maintained at ±5 percent voltage variations. It is apparent that data concerning the disturbances from the Xerox machine, code call and alarm bells was not known to either party until this problem arose and measurements were then made to facilitate correction. The standard of performance required of appellant by his supply contract was to manufacture and deliver specially designed equipment in conformance to the specifications. The evidence indicates that the specification criteria for maintaining accuracy under voltage variation limits were less than the voltage variations present and induced in appellant's equipment from equipment outside the transmission system. There is no evidence that the system operation was deficient because of an incompatibility between other components and appellant's equipment. The contention is raised that there is an inherent design requirement for equipment destined for 20 Appellant's comments on Government Responses to Interrogatories dated January 15, 1972, attached Leeds & Northrup drawing for one component, a thermal converter. powerplant environments to overcome electrical noise, frequency and voltage variations typically found there. In the presence of an express contract provision such as is present here respecting voltage variations to be accommodated, no greater requirement can be read into the contract when conformance to the contract standard does not yield the desired result.28 Additionally, little weight is given to the fact that the Government achieved satisfactory operation by substituting for the TAP68, equipment manufactured by another. There is no showing that the other equipment was manufactured to the same specifications. With reference to the calibration shifts complained of in the Government's letter dated January 7, 1971, it is noted that a single instance of a failure to hold calibration occurring some 22 months after delivery is not persuasive of the equipment being deficient with respect to the specification requirement not to require recalibration at unduly short intervals. We find that no defect for which appellant is responsible has been shown to be present in the TAP-68. Appellant did not fail to deliver conforming supplies. Having found the termination for default to be improper, it necessarily follows that the Government is without any contractual right to charge appellant the resulting excess costs.29 Conclusion The appeal is sustained. RUSSEL C. LYNCH, Member. WE CONCUR: WILLIAM F. MCGRAW, Chairman. SPENCER T. NISSEN, Member. El-Tronics, Inc., ASBCA No. 5457 (February 28, 1961), 61-1 BCA par. 2961: * it follows that an appeal by Appellant from the default termination is broad enough to cover any subsequent action by the Government in the exercise of its rights or remedies under the Default Article." See also Brook Labs Co., Inc., ASBCA No. 8266 (December 18, 1962), 1962 BCA par. 3624. GATEWAY COAL COMPANY 1 IBMA 82* Decided March 16, 1972 This is a decision on a cross-appeal filed by the Bureau of Mines challenging the legal and factual tests upon which a restraining order was issued by Malcolm P. Littlefield, Departmental Hearing Examiner. The order restrained the Bureau from enforcing against the Gateway Coal Company the mandatory safety *The appeal and cross-appeal filed in this proceeding were originally consolidated as Appeal No. IBMA 72-6. In view of the fact that the cross-appeal is now treated by the Board separately, it has been assigned a new appeal number for clarity. March 16, 1972 standard which was the subject of Gateway's pending Petition for Modification. This decision is on the cross-appeal only and does not decide the issues involved in the appeal by Gateway from the Examiner's denial of the relief sought by the Petition for Modification. Having been advised that the parties are engaged in discussions which may result in a settlement on the merits of that Petition, the Board reserves decision on that part of this case. Decision of the Hearing Examiner, in issuing the Restraining Order, AFFIRMED. Restraining Order CONTINUED. Application for Review, Docket No. PITT 72-210, DISMISSED. Federal Coal Mine Health and Safety Act of 1969: Modification of Application of Mandatory Safety Standards: Interim Relief The discretion of an examiner or the Board to grant interim relief, pending adjudication of a section 301 (c) petition for modification, may be exercised only after a hearing has been afforded the parties, and it clearly appears: (1) that the petition has been filed in good faith; (2) that during the interim, the health and safety of the miners will be reasonably assured; and (3) that the operator will suffer irreparable harm if the interim relief is not granted. APPEARANCES: Daniel R. Minnick, Esq., for Gateway Coal Company; Bernard M. Bordenick, Esq., for U.S. Bureau of Mines Opinion by Mr. Doane INTERIOR BOARD OF MINE OPERATIONS APPEALS FACTUAL BACKGROUND On September 17, 1970,1 Gateway Coal Company (Gateway) filed, pursuant to section 301 (c) of the Federal Coal Mine Health and Safety Act of 1969 (the Act),2 a petition for modification of the application of the mandatory fire protection safety standards to its Gateway Mine. The Petition dealt with several fire safety requirements under section 311 of the Act, including the requirement for automatic, overhead sprays at each of the belt drives on the belt haulage system.3 While this Petition was pending before a hearing examiner, the Bureau of Mines (Bureau) twice inspected the Gateway Mine and is sued Notices of Violation for not having the above-described sprays on two of the belt drives. After several extensions of time for abatement were granted, the Bureau required Gateway to abate the violations cited on or before May 3, 1971. Although a hearing on the Petition had been held, it appeared improbable that a decision would be reached by the date set for abatement. Confronted with the dilemma of having its Petition for Modification rendered useless by complying with 1 The Petition for Modification was originally received in May 1970, but was not accepted for filing until proof of service on the Bureau and the representative of miners had been received. 2 All references to the Act are to P.L. 71173, 83 Stat. 742-804. The Act is also codified in 30 U.S.C. §§ 801-960 (1970). 3 The Act § 311 (f); See also 30 CFR 75.1101 to 75.1101-22. |