October 13, 1960 The original date for opening of bids for the project was June 4, 1959. On May 26, 1959 this date was extended to September 1, 1959. The contract was entered into on September 10, 1959. Almost two months prior thereto, a national steel strike began on July 14, 1959. The two other major producing steel companies went on strike on July 15 and 17. The strike was not settled until 116 days thereafter on November 7, 1959. At the time of bid opening on September 1, at the time of award of the contract on September 10, and at the time of notice to proceed on September 19, 1959, the nation-wide steel strike was in existence. Appellant acknowledged receipt of notice to proceed on September 19, 1959, and in a letter of the same date indicated that the supply of 18 inch steel pipe was currently affected by the steel strike, that definite commitments had not been arranged, that it was hopeful steel pipe could be purchased from a source not affected by the strike and that it would proceed with other phases of the required work. Shortly thereafter on September 23, 1959, appellant advised the Government that it was unable to secure the required steel pipe until settlement of the strike, that a purchase order for the pipe had been issued to its supplier for delivery within 30 days of strike settlement. Appellant thereafter on October 2, 1959 was advised by the Project Engineer that no particular make of steel was required, that delivery of the same thirty (30) days following the strike did not meet with his approval, that appellant would be excused for delays of suppliers only if it was determined that steel pipe was not procurable in the open market, and that formal notice pursuant to Clause 5(c) of the General Provisions should be forwarded. Timely notice as required by the above provision was subsequently received by the Government on October 26, 1959. A few days later, the Project Engineer again advised appellant that it would be excused for delays of suppliers only if it is determined that the steel pipe was not procurable on the open market. The available evidence discloses that appellant diligently proceeded with other phases of the project where the non-available steel was not required from the inception of the contract until its definite notice to the Government on October 21, 1959 that steel pipe would not be available until four (4) weeks following the strike settlement. Despite the handicap of inclement weather following delivery of the required steel pipe on January 6, 1960, the project was successfully completed on February 20, 1960. By letter dated March 8, 1959 appellant requested an extension of 94 days, based on the fact that steel pipe was unobtainable at the time the contract was awarded due to the steel strike. Copies of correspondence with various suppliers indicating an intensive effort to procure the steel pipe was enclosed therein. On April 25, 1960, the contracting officer denied appellant's request for 94 days extension of time for performance on the ground that, first, appellant's bid was entered during the steel strike, secondly, although the duration of the strike was not foreseen at that time, the delay in completion was not attributable to unforeseeable causes within the meaning of the Damages for Delay-Time Extension Provision, Clause 5 (c) of Standard Form 23A. Appellant contends the contracting officer's decision disallowing its request for an extension of time for performance is erroneous for reasons as follows: (1) The Government also was aware of the existence of the strike at the time of opening of bids, and award of the contract. (2) Neither the Government nor appellant were foresighted to the extent that either knew the duration of the strike. (3) Performance under strike conditions was impossible. (4) Failure to make a finding that the steel pipe was not procurable in the open market.* The Government argues the appellant should have foreseen and prepared for a market shortage of the steel pipe since it was aware of the steel strike; consequently the unavailability of steel was foreseeable, and not without its fault or negligence which is a necessary requisite for excusability for delay in performance as encompassed by Clause 5(c) of Standard Form 23A. Appellant's allegations of impossibility of performance is considered untenable by Department Counsel for want of proof thereof. The contracting officer's failure to make a finding that steel pipe was not obtainable on the open market is considered by Government counsel not germane, since the unavailability of steel pipe in the open market would not constitute excusable delay in performance under the circumstances herein, and would have been necessary only in the event the contracting officer had found that the inability of the appellant to secure delivery, in adequate time from its supplier was an unforeseeable cause of delay beyond the control and without the fault or negligence of the appellant or its suppliers.5 The Board must decide, in order to resolve this dispute whether the provision entitled "Termination for Default-Damages for Delay * Appellant places great emphasis on this point in its brief. 39 Comp. Gen. 478 (1959); General Electric Co., CA-130, 61 I.D. 4 (1952); cf. Finaco Electrical Products, IBCA-104, 57-1 BCA par. 1266 (1957). October 13, 1960 Time Extension" (Clause 5 (c)) General Provisions of Standard Form 23A (March 1953) as modified by Paragraph 27, Supplement to Standard Form 23A, Bureau of Reclamation, which provides that appellant shall not be charged with liquidated damages because of delays due to unforeseeable causes beyond the control and without the fault of appellant, including strikes, requires the remission of liquidated damages for delay caused by a nationwide steel strike found to have been in existence at the time of submission of bid," opening of bids and award of the contract. (As amended this proviso further provides that appellant shall be excused for delays of suppliers only if the contracting officer shall determine that the materials to be furnished are not procurable in the open market.) It is plain that the portion of Clause 5(c) in referring to "unforeseeable causes" speaks of the future. Here the condition complained of is a strike, which was already in existence at the time appellant submitted its bid, and, of course, at the time of opening of bids and award of the contract. In order to avoid a narrow construction of the term "unforeseeable causes," the above provision sets forth some illustrations of unforeseeable interferences. It describes, as including but not restricted to, acts of God and of the Government, fires, floods, strikes, and so forth. The purpose of the proviso is to protect the appellant against the unexpected, and in its grammatical sense, militates against holding that the listed events are always to be regarded as unforeseeable, no matter what the attendant circumstances. The word “unforeseeable" must in our opinion qualify each event set out in the including phase, which includes "strikes." The full text of this provision as amended is quoted: "(c) The right of the Contractor to proceed shall not be terminated, as provided in paragraph (a) hereof, nor the Contractor charged with liquidated or actual damages, as provided in paragraph (b) hereof because of any delays in the completion of the work due to unforeseeable causes beyond the control and without the fault or negligence of the Contractor, including, but not restricted to, acts of God or of the public enemy, acts of the Government, in either its sovereign or contractual capacity, acts of another contractor in the performance of a contract with the Government, fires, floods, epidemics, quarantine restrictions, strikes, freight embargoes, and unusually severe weather, or delays of subcontractors or suppliers due to such causes: Provided, That the Contractor shall within 10 days from the beginning of any such delay, unless the Contracting Officer shall grant a further period of time prior to the date of final settlement of the contract, notify the Contracting Officer in writing of the causes of delay: Provided further, That the Contractor shall be excused for delays of suppliers only if the Contracting Officer shall determine that the materials or supplies to be furnished are not procurable in the open market. The Contracting Officer shall ascertain the facts and the extent of the delay and extend the time for completing the work when in his judgment the findings of fact justify such an extension, and his findings of fact thereon shall be final and conclusive on the parties hereto, subject only to appeal as provided in Clause 6 hereof." 7 Letter dated October 29, 1959 from Acting Regional Director, Sacramento, Californi states appellants' bid was submitted well after the strike began. Under the circumstances presented in this appeal, the steel strike and its attendant complications clearly cannot be regarded as coming within the category of "unforeseeable" causes of delay, within the meaning of the quoted term as used in clause 5 (c) of Standard Form 23A. Appellant should have considered all existing circumstances at the time of submission of its bid. Appellant's knowledge of the strike at the time of submission of its bid is established by the record. It is true that appellant was not prescient to the extent that it could determine the length of the steel strike, and it is reasonable to assume that if the strike was not prolonged, the contract would have been performed within the time required, with no assessment of liquidated damages. The national steel strike, which began on July 14, 1959, was, however, in existence at the time appellant submitted its bid, at the time of bid opening, and award of the contract. It can hardly be said it was unforeseeable. It is well settled by our highest court that causes of delay must be unforeseeable. We must perforce sustain the contracting officer's denial of appellant's request for an extension of time for performance and remission of liquidated damages. The appeal is therefore denied. JOHN J. HYNES, Member. THOMAS M. DURSTON, Member. PAUL H. GANTT, Chairman. 8 See Judge Madden's dissenting opinion in Brooks-Callaway v. United States, 97 Ct. Cl. 689, 700 (1942), quoted by the Supreme Court with approval in United States v. BrooksCallaway, 318 U.S. 120 (1943), which is quoted, in part, as follows: “* Not every fire or quarantine or strike or freight embargo should be an excuse for delay under the proviso. *** A strike may be an old and chronic one whose settlement within an early period is not expected. In any of these situations there would be no possible reason why the contractor, who of course anticipated these obstacles in his estimate of time and cost, should have his time extended because of them." 39 Comp. Gen. 343, 348 (1959), 39 Comp. Gen. 478 (1959), wherein the Comptroller General referring to the same steel strike with which we are concerned here states: "If the cause of the delay was in existence at the time the contract was awarded and the contracting parties were aware of its existence, it is not an 'unforeseeable cause' within the meaning of that term as used in Standard Form 23A." Elmer A. Roman, IBCA-57, 57-1 BCA par. 1320 (1957); General Electric Company, CA–130, 61 I.D. 4 (1952). October 19, 1960 A-28393 MERWIN E. LISS CUMBERLAND AND ALLEGHENY GAS CO. Decided October 19, 1960 Oil and Gas Leases: Acquired Lands Leases-Oil and Gas Leases: Future and Fractional Interest Leases An acquired lands lease offer for land in which the United States owns only a fractional interest in the minerals is defective if it is not accompanied by a statement as to ownership of operating rights in the interest not owned by the United States, and the offer confers no priority upon the applicant until such time as the statement is filed. Oil and Gas Leases: Acquired Lands Leases-Oil and Gas Leases: Future and Fractional Interest Leases-Oil and Gas Leases: Acreage Limitations An acquired lands lease offer for land in which the United States owns only a fractional interest in the minerals may be allowed where the acreage applied for exceeds 2,560 acres but the excess is not more than 10 percent over 2,560 acres. Oil and Gas Leases: Acquired Lands Leases-Oil and Gas Leases: Future and Fractional Interest Leases An offer to lease lands for oil and gas which covers lands in excess of 2,560 acres by less than 10 percent will not be rejected with loss of priority where the offeror mistakenly thought that his offer was within the acreage limitation because the United States owned only a 75 percent interest in the oil and gas. APPEAL FROM THE BUREAU OF LAND MANAGEMENT Merwin E. Liss has appealed to the Secretary of the Interior from a decision of the Acting Director, Bureau of Land Management, dated December 29, 1959, which affirmed the decision of the Chief, Lands Adjudication Section, of the Eastern States land office, dated May 5, 1959, holding that acquired lands oil and gas lease offer BLM-A 046863, filed by the Cumberland and Allegheny Gas Company on May 15, 1958, had priority over his application, BLM-A 041283, filed on October 21, 1955. Both offers are for the 75 percent undivided interest in the oil and gas deposits in certain lands acquired by the United States of which the surface and 25 percent undivided interest in the oil and gas deposits have been conveyed by the United States to the State of Maryland. The pertinent regulation (43 CFR, 1954 ed., rev., 200.7) provides: (d) Offers for fractional interest oil and gas leases other than future fractional interests. An offer for a fractional present interest noncompetitive lease 67 I. D., No. 11 577050-60—1 |