WAR AND NATIONAL DEFENSE

• Document Type: CREST
• Collection: General CIA Records
• Document Number (FOIA) /ESDN (CREST): CIA-RDP76M00527R000700220011-8
• Release Decision: RIFPUB
• Original Classification: K
• Document Page Count: 10
• Document Creation Date: December 9, 2016
• Document Release Date: September 2, 2001
• Sequence Number: 11
• Publication Date: January 1, 1974
• Content Type: BOOK

'ENSE
Act Sept. 3, 1954, c. 1257,
r, 68 Stat. 1'177, provided
to brigadier general and -
, and is now covered by
ncl 8375 of Title 10, Armed
Act Sept. 3, 1954, c. 1237,
68 Stat. 1178, provided for
the promotion list by the
1 is now covered by sec-
itle 10, Armed Forces.
, Act Sept. 3, 1954, C. 1257,
1, 68 Stat. 1179, related to
ial Guard, and is now cov-
ons 8374, 8377 and 8379 of
ed Forces, and section 307
gational Guard.
t, Act Sept. 3, 1954, c. 1257,
, 68 Stat. 1179. provided for
first lieutenant in Air Na-
of the United States, and
:c.1 by sections 8365 and 8819
.rmed. Forces.
I, Act Sept. 3, 1954, c. 1257,
68 Stat. 1179, provided for
captain, major, and lieu-
in the Air National Guard,
covered by section 8366 of
ied Forces.
2, Act Sept. 3, 1954. c. 1237.
68 Stat. 1180, related to de-
s, and is now covered by
and 8849 of Title 10, Armed .
section 323 of Title 32. Na-
3, Acts Sept. 3, 1954, c. 1257;
i23. GB Stat. 1181; June 30,'
? 4(i), 69 Stat. 220, related
ages for retention in active-:
is now covered by sections
Title 10, Armed Forces.
41, Acts Sept. 3, 1954, c. 1257,
24. 68 Stat. 1182; June 30,
? 4(j), 69 Stat. no, related
on of officers for length . of
Is now covered by sections,
651 and 8852 of Title . 10
us.
55, Act Sept. 3, 1954, C. 1257,
25, 68 Stat. 1183, provided fo
of excess officers, and is now
Fection 8850 of Title 10. Armed
06, Act Sept. 3, 1954. c. 1257
26, 68 Stat. 1183, provided fo
or transfer of adjutants gen
&staid adjutants general, and
ered by section 8381 of Titi
Forces.
357, Act Sept. 3, 1954, c. 125
527, as added June 30, 1956
t(k), 69 Stat. 220, related t
iployees of the Air Nationa
note set out under sectio
le 10. Armed Forces.
n..4 RESERVE
? 36A, Sept. 2, 1958,..
. and Lelection boards, and
ed by section 780 of Title- 1
rd.
1385, Act Sept. 3, 1934. c. 1257;':--
? 605, 68 Stat. 1185. provided..:.
lance, and is now covered by.
1 of Title 11, Coast Guard.
1388, Acts Sept. 3, 1954, c. 1237.
; 698, 68 Stat. 1185; June 30,
17. ; 5(a), 69 Stat. 221, related .
:r mates, and is now covered by.
2 of Title 11, Coast Guard.
1387, Act Sept. 3, 1951, c. 1.257..
? 607. 68 Stat. 1186, related to
, zones, and is now covered by.
3 of Title 11, Coast Guard.
1388, Acts Sept. 3, 1951, c. 1257,
i1)8, 68 Stat. 1186; June 30,
WAR AND NATIONAL DEFENSE 50 ? 1431
1955, c. 247 ? 5(b), 69 Stat. 221, related now covered by section 789 of Title 14.
to date of rank upon promotion, and is Coast Guard.
now covered by section 784 of Title 14.
Coast Guard
Section 1389, Act Sept. 3, 1954, c. 1257.
Title VI, ? 609, 68 Stat 1186. related to
minimum points for consideration for
promotion, and is now covered by section
785 of Title 14, Coast Guard.
Section 1390, Act Sept. 3, 1954, c. 1257,
Title VI, ? 610, 68 Stat. 1186. related to
qualifications for promotion, and is now
covered by section 780 of Title 14. Coast
Guard.
Section 139/, Act Sept. 3, 1054, C. 1257,
Title VI. ? 611, 68 Stat. 1186, related to
failure of selection and elimination, and
is now covered by section 787 of Title 14.
Coast Guard.
Section 1392, Act Sept. 3, 1954, c. 1257,
Title VI. ? 612, 68 Stat. 1187, provided
for removal from promotion list by the
President, and is now covered by section
788 of Title 14 Co t C
Section 1394, Act Sept. 3, 1954, e. 1257,
Title VI. ? 614, 68 Stat. 1187, related to
type of promotion, and is now covered
by section 790 of Title 14, Coast Guard.
Section 1395, Act Sept. 3, 1954, c. 1257,
Title VI, ? 615. 68 Stat. 1188, related to
Promotion of officers serving on active
duty, and is now covered by section 791
of Title 14, Coast Guard.
Section 1396, Act Sept. 3, 1954, e. 1257,
Title VI, ? 616, 68 Stat. 1188, provided for
appointment of former Navy and Coast
Guard officers, and is now covered by
section 792 of Title 14, Coast Guard.
Section 1397, Act Sept. 3. 1954, c. 1257,
Title VI, ? 617, 68 Stat. 1188, provided for
recall of retired officers, and Is now cov-
ered by section 793 of Title 14, Coast
Guard.
Section 1398, Act Sept. 3, 1954, c. 1257,
Section 1393. Act Sept. 3, 1954, c. 1257, the Secretary to promulgate regulations,
Title VI, ? 618, 68 Stat. 1188, authorized
Title VI, ? 613. 68 Stat. 1187, related to and is now covered by section 794 of
maximum ages for active status, and is Title 14, Coast Guard.
1955
? 1399. Promotion of officers selected for promotion prior to July 1,
Codification. Section, Act Sept. 3, 1954.
c. 1257, Title VI, ? 619, as added June
30, 1955. c. 247, ? 5(c), 69 Stat. 221, which
authorized promotion of officers who
were selected for promotion prior to July
1, 1955, was omitted from the Code.
CHAPTER 28.--STATUS OF ARMED FORCES PERSONNEL
APPOINTED TO SERVICE ACADEMIES
[NEW; REPEALED]
?? 1411-1414. Repealed. Pub.L. 85-861, ? 36A, Sept. 2,
Stat. 1570
Sections 1411-1414, Act June 25, 1956, c.
439, ?? 1-4, 70 Stat. 333, related to the
status of Armed Forces personnel ap-
pointed to service academies, to continu-
ance of enlistment contract or period of
obligated service, reversion to enlistment
status upon separation from service sea-
1958, 72
demy, charge against allowed number of
Personnel in Armed Forces, and to re-
striction on counting Academy service
towards length of service as officer, and
are now covered by sections 516, 3201,
:3203, 3214, 5415, 8201, 8203 and 8214 of
Title 10, Armed Forces.
CHAPTER 29.-NATIONAL DEFENSE CONTRACTS [NEW]
Sec.
Sec.
1431. Authorization; official approval; (b) Former military and civilian
Congressional action: notifica-
tion of Committees of certain pro- officials employed .by de-
posed obligations, resolution of tense contractors; Depart. meat continuity of session, merit of Defense employees
computation of period. previously employed by de-
1432. Restrictions. de-
fense contractors.
1423. Public record: examination of roc- (c) Exceptions.
(d) Reports to Congress.
ords by Comptroller General;
(e) Termination of employment;
exemptions: exceptional condi-
tions; reports to Congress. filing reports under sub-
1434, Reports to Congress: publication. section (b) (1) or (2).
availability
1435. Effective period. (f) section
of information.
1436. Reporting requirements. (g) Penalties.
(a) Definitions.
(h) Commencement date.
Library references: United States c(13 et seq.; War end National Defense C=>10
et seq.; C.J.S. United States ? 83; C.J.S. War and National Defense ? IS et seq.
Code of Federal Regulations
Procedures applicable to contracts, see 11 CPR 1-17.000 et seq.
? 1431. Authorization ; official approval; Congressional action: no-
tification of Conimittees of certain proposed obligations, resolution of dis-
approval, continuity of session, computation of period
Tho President may authorize any department or agency of the Gov-
ernment which exercises functions in connection with the national defense,
155 U S.C.A.--17
1,)74 1 45
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50 ? 1431 WAR AND NATIONAL DEFENSE
'The Contractor warrants that no per-
son or selling agency has been employed
or remitted to solicit or secure this con-
tract upon au agreement or understanding
for a commission, percentage, brokerage.
or contingent fee, except boon-tide em-
ployees or bona-tide established commer-
cial or selling agencies maintained by the
Contractor for the purpose of securing
business. For breach or violation of this
warranty the Government shall have the
right to annul this contract without lia-
bility or, in its discretion, to deduct from
the contract price or consideration, or
otherwise recover, the full amount or such
commissiou' percentage, brokerage, or
cuntingent fee."
11. Except as provided in the Act of
September 27, 1966, 80 Stats. 850 [which
amended section 1433 of this title, sec-
tions 2310, 2313 of Title 10, Armed Forces,
and section 254 of Title 41, Public Con-
tracts] contracts entered into, amended,
or modified pursuant to authority of this
order shall include a clause to the effect
that the Comptroller General of the Unit-
ed States or any of his duly authorized
representatives shall, until the expiration
of three years after final payment, have
access to and the right to examine any
directly pertinent books, documents, pa-
pers, and records of the contractor or
any of his subcontractors engaged in the
performance of, and involving transac-
tions related to, such contracts or sub-
contracts. Before exercising the authori-
ty provided in the Act of September 27,
1966, 80 Stat. 850 [which amended section
1433 of this title, sections 2310, 2313 of
Title 16, Armed Forces, and section 254
of Title 41, Public Contracts], the Secre-
taries of Defense, the Army, the Navy or
the Air- Force, or their -designees, shall
first determine that all reasonable efforts
have been made to include the clause
prescribed above and that alternate
sources of supply are not reasonably
available.
12. Nothing herein contained shall be
construed to constitute authorization
hereunder br?
(o) the use of the cost-plus-a-percent-
age-of-cost system of contracting?,
(b) any contract in violation a exist-
ing law relating to limitation of profits
or fees ;-
(e) the negotiation of purchases of or
contracts for property or services re-
quired by law to be procured by formal
advertising and contpetitive'bidding;
(d)- the waiver of any bid, payment.
performance, or other bond required by
law:
(e) the amendment of a contract ne-
gotiated under section 2304(a) (15) of
title 10 of the United States Code to in-
crease the contract price to an amount
higher than the lowest rejected bid of any
responsible bidder: or
(f) the formalization of an Informal
commitinent, unless the Secretary of De-
fense, the Secretary of the Army, the Sec-
retary of the Navy, or the Secretary of
the Air Force, or the duly authorized rep-
resentative of any such Secretary, finds
that at the time the commitment was
made it was impracticable to use normal
proeurement procedures
13. The provisions of Om Walsh-Healey
Act (49 Stat. 2031), as amended (sections
Generally 3
Adjustments in price 11.
Reductions 12
Agents
Contractors as government
Empliiyment
An0 %Valleuu of claims ita
Notes of
35-45 of Title 11], the Davis-Bacon Act (19
Stat. lull), as untended [sections 276a to
27tia-5 of Title 401, the Copeland Act (48
Stat. 948), as amended, and the Eight-
Hour Law (37 Stat. 137), as amended [sec- -
Lions 321 and 322 of Title 40], if otherwise
applicable, shall apply to contracts made
and performed under the authority of
this order.
14. Nothing herein contained shall
prejudice anything heretofore done under
Executive Order No. 9001 of December 27,
1911, or Executive Order No. 10210 of Feb-
ruary 2, 1951 [set out as notes under see-
d n GIL of this Appendix to this title],
or auy amendments or extensions thereof,
or the continuance in force of an action
heretofore taken under those orders or
any amendments or extensions thereof.
15. Nothing herein contained shall
prejudice any other authority which the
Department of Defense may have to en-
ter into, amend, or modify contracts, and
to make advance payments.
PART II?EXTENSION OF PROVISIONS
OF PARAGRAPHS 1-44
21. Subject to the limitations and reg-
ulations contained in paragraphs 1 to 14,
Inclusive, hereof, and under any regula-
tions prescribed by him in pursuance of
the provisions of paragraph 22 hereof,
the head of each of the following-named s-
agencies is authorized to perform or ex-,
ercise as to his agency, independently of -
any Secretary referred to in the said
paragraphs 1 to 14, all the functions and
authority vested by those paragraphs in
the Secretaries mentioned therein:
Department of the Treasury
Department of the Interior
Department of Agriculture
Department of Commerce
Department of Transportation
Atomic Energy Commission -
General Services Administration
National Aeronautics and Space Ad
ministration
Tennessee Valley Authority
Government Printing Office -
22. The head of each agency named in...,
paragraph 21 hereof is authorized to pre-,-1,,
scribe regulations governing the carrying!,
out of the functions and authority vested -
with respect to his agency by the provi-
sions of paragraph 21 hereof. Such regu-
lations shall. to the extent practicable, be
uniform with the regulations prescribed'
or approved by the Secretary of Defense,
under the provisions of Part I of this
order.
23. Nothing contained herein shall
prejudice any other authority which any
agency named in paragraph 21 hereof:.
may have to enter into, amend, or modifys
cnownnttrsacts and to make advance nays'
24. Nothing contained in this Part shall.k-s.
constitute authorization thereunder for 4`...z.,
the amendment of a contract negotiated
under section 302(c) (14) of the Federal?-t';_i
Property and Administrative Services Act:_s,
of 1949 (63 Stat. 394), as amended by sec'.-
tion 2(b) of the act of August 28, 1953,-;''
72 Stat. 9116 [section 252(e) (14) of Title
41]. to increase the contract price to an
amount higher than the lowest rejectea
hid of any responsible bidder.
DWIGHT D. EISENHOWER
Decisions
Breach
Contracts 4
Warranties 5
Cancellation of contracts 6
Collateral estoppel 33
13 Commissions 13
Contingent tees 16
Contingent fees 16
WA!
Contractors US irovernmet
Contracts, breach of 4
Correction of mistakes 7
Costs 17
Credits 18
Damages 33
Liquidated damages
Delays, performance of co
Demurrer 28
Employment of agents 14
Estoppel 31
Evidence 27a
Financing. institutions 19
Guaranties 20
Dardship claims 21
Items of cost 17
Judicial notice 32
Labor disputes 22
Law governing 2
Leases 23
Liquidated damages 34
Modification of contracts 8
Parties 26
Performance of contracts
Delays 10
Time for 9
Pleadings 27
Purpose 1
Reductions in price 12
Regulations 21
Removal of actions 25
Res Judie:Aft 35
Review 36
Sovereign immunity 29
Termination of contracts 6
Time for performance of eon(
Violation of regulations 24
Waiver 30
Warranties, breach of 5 ,
1. Purpose
Former section 611 of AIM
title was not passed for
of contractors or for their rs
unprofitable contract, but s(
benefit of the nation as a wh
to facilitate the prosecution
Bolinders Co. v. U. S. 1957,
381, 139 Ct.C/. 677, cerilorari
Ct. 538, 355 U.S. 933, 2 L.Ed
The purpose of provision of
tion 611 of Appendix to this t
ering President to authorize
tal agencies prosecuting the
to enter into contracts facilitt
cution of war was to enable s
to the President, either In h
as Chief Executive or in his o
ity as Commander in Chief,
freely for all supplies and ser
ed to facilitate prosecution of
soy v. Oregon Motor Stages, 194
967, 183 Or. 494,
2. Law governing
Regardless of state law that
ply to contract warranty, inr
warranty in contract with g
was required by executive orde
breach of that warranty was
by federal law. U. S. v. Wel
De1.1968, 396 F.28 381.
?Ex.Ord.No.9001, Dee. 27, 194
6787, as amended requiring cc
contain warranty that contract?
employed any persort to secure
Upon an agreement for a contin;
shitos a federal rule
Policy, and federal and
not s
governs the applicability of ti
Mitchell v. .Plintkote Co., C.A.
185 F.24-11008.
Executive Order requiring cm
contain warranty that contractor
employed any person to secure
upon an agreement for a con ting,
mission states a federal rule o
Policy, and federal and not at
governs applicability or tile orde
oral Paeifie Elec. Co. v. McAdan
i39 N.Y.5.2.11 418, 207 rdiAe. 525.
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.ONAL DEFENSE
35-45 of Title 411, the Davis-Bacon Act (49
Stat. 1011), as amended tsections 276a to
of Title 401, the Copeland Act (48
Stat. 948), as amended, and the Eight-
liver Law (37 Stat. 137), as amended
tions 321 and 322 of Title 401, if otherwise
applicable, shall apply to contracts made
and performed under the authority of
this order.
14. Nothing herein contained shall -
Prejudice anything heretofore done under.:
_Executive Order No. 9001 of December 27,,:
1941, or Executive Order No. 10210 of Feb-
miry 2, 1951 [set out as notes under sec-
tion 611 of this Appendix to this title),
or any amendments or extensions thereof;
or the continuance in force of an action
heretofore taken under those orders or
any amendments or extensions thereof.
15. Nothing herein contained shall
prejudice any other authority which the .
Department of Defense may have to en-
ter into, animal, or modify contracts, and
to make advance payments.
PART If?ExTENSION OF PROVISIONS
OF Partnuaa.ens 1-14
21. Subject to the limitations and reg- --.
- ulations contained in paragraphs. 1 to 14,;:
. inclusive, hereof, and under any regula-
. tions prescribed by him in pursuance ofs'_-.
the provisions of paragraph 22 hereof,-;',:
. the head of each of the foilowing-named ? .
. agencies is authorized to perform or
.. ercise as to his agency, independently of -S
any Secretary referred to in the said
;paragraphs 1 to 14, all the functions an1.4
.f authority vested by those paragraphs i,n:..
a the Secretaries mentioned therein:
t. Department of the Treasury .
,r Department of the; Interior
11Departlilefit of Agriculture
:s Department of Commerce
me Department of Transportation
:e Atomic Energy Commission
ly General Services Administration
National Aeronautics and Space Ad,
)e ministration
in Tennessee Valley Authority
Government Printing Office
t- 22. The head of each agency named in r;..
paragraph 21 hereof is authorized to pre-.
,t. scribe regulations governing the carrying ,
ts out of the functions and authority vested-
with respect to his agency by the provi-
sions of paragraph 21 hereof. Such regu-
lations shall, to the extent practicable, be
uniform with the regulations prescribed
or approved by the Secretary of Defense
under the provisions of Part I of this
order.
23. Nothing contained herein shall
prejudice any other aulhority which any
agency named in paragraph 21 hereof
may have to enter into, amend, or modify,
contracts and to make advance llitYmnen,-
t :
24. Nothing contained in th s all
um constitute authorization thereunder for
Do, the amendment of a contract negotiated-
;oo. tinder section 302(c) (14) of the Federal
of Property and Administrative Services Act
.op. of 1949 (63 Stat. 394). as amended by sec-
lids tion 2(b) of the act crf August 28, 1958.
was 72 Stat. 966 [section 252(e) (14) of Title
mai 411. to increase the contract price to an
amount higher than the lowest rejectea
II" bid of any responsible bidder.
Ions DWIGHT D. DISENHOWEIt
or
.e-
tal
at.
by
of
le-
in-
tilt
Lily
of Decisions
Breach
Contracts 4
Warranties 3
Cancellation of contracts 6
Collateral estoppel. 35
Commissions IS
Colltingent fees 16
Contingent fees 16
148
WAR AND NATIONAL DEFENSE 50 ? 1431
-Note 5
Contractors as government agents
Contracts, breach of 4
Correction of mistakes 7
Costs 17
Credits 18
Damages 33
Liquidated damages 34
Delays, performance of contracts
Demurrer 28
Employment of agents 14
Estoppel 31
Evidence 27a
Financing institutions 19
Guaranties 20
Hardship chums 21
Items of cost 17
Judicial notice 32
Labor disputes 22
Law governing 2
Leases 23
Liquidated damages 24
Modification of contracts 8
Parties 26
Performance of contracts
Delays 10
Time for 0
Pleadings 27
Purpose 1
Reductions in price 12
Regulations 24
Removal of actions 25
lies Judieata 33
Review 30
Sovereign immunity 29
Termination of contracts 6
Time for performance of contracts
Violation of regulations 24
Waiver 30
Warranties, breach of 5
13
10
0
1. Purpose
Former section 611 of Appendix to this
title was not passed for the benefit
of contractors or for their relief from an
unprofitable contract, but solely for the
benefit of the nation as a whole, in order
to facilitate the prosecution of the war.
Bolinders Co. v. U. S. 1957, 153 F.Supp.
381, 139 Ct.C1. 677, certlorari denied 78 S.
Ct. 538, 355 U.S. 953, 2 L.F.d.2d 530.
The purpose of provision of former sec-
tion 611 of Appendix to this title empow-
ering President to authorize governmen-
tal agencies prosecuting the war effort
to enter into contracts facilitating prose-
cution of war was to enable subordinates
to the President, either In his capacity
as Chief Executive or in his other capac-
ity as Commander in Chief, to contract
freely for all supplies and services need-
ed to facilitate prosecution of war. Dor-
sey v. Oregon Motor Stages, 1948, 194 P.28
067, 183 Or. 494.
2. Law governing
Regardless of state law that might ap-
ply to contract warranty, inasmuch as
warranty in contract with government
was required by executive -order, suit for
breach of that warranty was controlled
by federal law. U. S. V. Webber, C.A.
Dell968, 396 F.28 381.
Ex.Ord.No.9001, Dec. 27, 1941, 6 P.R.
6787, as amended requiring contract to
contain warranty that contractor has not
employed any person to secure contract
upon an agreement for a contingent com-
mission states a federal rule of public
policy, and federal and not state law
governs the applicability of the order.
Mitchell v. Flintkoto Co., C.A.N.Y.I951,
If.28 1008.
Executive Order requiring contract to
contain warranty that contractor has not
employed any person to secure contract
upon an agreement for a contingent mini-
InissiOn states a federal rule of subtle
Policy, and federal and not state law
governs applicability of the order. Fed-
eral Pacific Elec. Co. v. MeAdams, 1935,
139 N.Y.S.2d 418, 207 Misc. 525.
3. Generally
Granting of relief to a government con-
tractor under former section 611 of Ap-
pendix to this title is not a matter of
right, and denial of such relief gives rise
to no legal or equitable claim and appli-
cation for relief by government contractor
to Air Force Contract Adjustment Board
in connection with termination of govern-
ment contract was not a compliance with
articles of contract providing for filing of
claims arid appeals. Commonwealth En-
gineering Co. of Ohio V. U. S., 1900, 180 F.
Stipp. 396,148 Ct.C1. 330, certiorari denied
81 S.Ct. 55, 364 U.S. 820, 5 I..Ed.2d 50.
3a. Allowance of claims
Action by responsible government offi-
cial on claim filed under this chapter re-
lating to national defense contracts is
entirely discretionary arid the allowance
of such claim requires finding by official
considering it that such action would fa-
cilitate the national defense. Winder
Aircraft Corp. of Fla. v. U. S., 1969, 412
P.2d 1270, 188 Ct.C1. 799.
4. Breach?Contracts
The War Manpower Commission's re-
fusal to furnish its services as an em-
ployment agency to employers, who were
operating under a construction contract
with the United States and who were in-
volved in the labor dispute., was not ar-
bitrary, unreasonable, and illegal, and.
therefore, was a sovereign act and not a
breach of the implied terms of the con-
tract. Ottinger v. U. S.. 1952. 106 F.Supp
108, 123 Ct.C1. 23.
In order for a contractor to recover
damages against United States for delay
in connection with a government con-
tract, Plaintiff must establish a breach of
contract upon which to predicate a claim
for damages, and mere fact that plaintiff
has sustained a loss is not enough to en-
large provisions of a written contract and
to recover damages. Parish v. U. S., 1951,
98 F.Supp. 347, 120 Ct.CI. 100, certiorari
denied 72 S.Ct. 625. 312 U.S. 953. 96 1..Ed
708.
Where a contractor entered into a
contract with a government agency in
1943, but notice to proceed was not giv-
en until the fall of 1994 after nroject
had been cleared by War Production
Board, in view of wartime circumstanc-
es, the delay in giving plaintiff notice
to proceed with contract was not so un-
reasonable as to amount to a breach of
contract. Id.
A motor bus carrier's use of Govern-
ment owned vehicles to transport passen-
gers between army camp and nearby
city was not breach of contract forbid-
ding carrier from using vehicles of third
party to carry passengers between camp
and city, where Government's insistence
that carrier use Government vehicles or
stay out of the camp was compulsory
though expressed in form of voluntary
agreement notwithstanding that contract
contained no provision excusing carrier
from promise not to use third party's
vehicles. Dorsey v. Oregon Motor Stages,
1948, 194 P.2d 967, 183 Or. 494.
5. ? Warranties
Where partners had made a contingent
fee arrangement with contract solicitor
in breach of partners' contract with goy -
ern m ent' s assignor and corporation sub-
sequently formed by partners had as-
sumed the contract, performed the work.
and was paid by assignor therefor, cor-
poration was deemed to have adopted
the contract and it was liable to the
United Stades for breiteli of warranty.
Ti. S. v. Webber. D.C.De1.1067, 270 10.
Supp. 286, affirmed 396 F.21 381.
Under bite facts in ti prior district
court ease where partners secured a sub-
contract frmn tli govern men l's value
149
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50 ? 1431 WAR AND NATIONAL DEFENSE
Note 5
contractor through the services of a con-
tract solicitor in breach of a warranty
in the subcontract, the United States as
assignor of the prime contractor's rights
was entitled to enforce those rights
against the partners in absence of a
showing that the assignor had released
the partners, even though the partners
formed a corporation during the perform-
ance of the contract, which corporation
was found to have assumed the contract.
Id.
Ex.Ord.No.9001, Dec. 27, 1941, 6 10.11,
6787 requiring war contracts to contain a
warranty that contract had not been se-
cured or solicited for a commission by
one other than a bona fide commercial
or selling agency maintained by the con-
tractor to obtain business and that upon
a breach of the warranty the government
should have right to annul contracts or
deduct the wrongful commission did not
declare the contract to he void if the
warranty were violated. Ebeling. v. Fred
J. Swaine Mfg. Co., 1948, 209 S.W.26 892,
357 Mo. 549.
6. Cancellation of contracts
In determining whether the United
States properly terminated for default a
contract between the Department of
Army and contractor for manufacture
and delivery of fire bombs, since tele-
gram advised contractor that "letter fol-
lows" and since the acts or omissions of
default were not stated in telegram but
were set forth in letter, the two docu-
ments must be considered together and
constituted but a single notice of termina-
tion. U. S. v. Chichester. C.A.Cal.1963,
312 F.24 275.
Where contract between Department of
the Army and contractor required con-
tractor to make deliveries of fire bombs
In specific quantities in each of calendar
months specified, and "default" clause au-
thorized government to terminate con-
tract if contractor failed to make deliv-
ery within specified time, government
could terminate contract without notice
upon failure of contractor to meet each
month's delivery schedule, in view of
fact that parties intended time to be of
essence of the delivery schedule. Id.
Cancellation of the contract in suit by
the contracting officer, on the recommen-
dation of the procurement officer, with-
out any findings of fact by the contract-
ing officer and over, the protest of the
contractor, who was without fault re-
garding the delay, did not relieve the
Government of liability. Universal Pow-
er Corp.. v. U. S., 1948, 112 Ct.C1. 07.
7. Correction of mistakes
Where livestock slaughterer's original
subsidy claim contained incorrect slaugh-
ter and cost statistics, and slaughterer
lefused to comply with Reconstruction
Finance Corporation's request that
slaughterer submit a corrected claim,
corporation's refusal to pay subsidy to
slaughterer for such month was proper.
Smith v. Floete, Em.App.11159, 269 F.2d
676.
The exercise of power, given chiefs of
technical services by Army Procurement
Regulation and Ex.Ord.No.9001, Dec. 27,
1941, 6 P.R. 6787 to enter into supplemen-
tal agreements for correction of- govern-
ment contractors' unilateral inistakes,
rests with proper officials of procure-
ment agencies, not with courts. Salig-
man v. U. S., D.C.Pa.1944, 56 F.Supp. 505.
a. Modification of contracts
Court of Claims was powerless to coni-
pet granting to contractor, which had
contracted with the United States to
manufacture for United States napalm
fire bombs, relief under Title II of First
War Powers Act, former section 611 et
seq. of Appendix to this title, which au-
thorizes relief for contractor on finding
that such action will facilitate national l's?
defense or prosecution of war where such
relief depends entirely on administrative
determination that such relief will facili-
tate national defense. Evans Reamer &
Mach. Co. v. U. S., 1967, 386 F.26 873,
181 Ct.CI. 539, certiorari denied 88 S.Ct.
1102, 309 U.S. 982, 19 I..Ed.2d 1279.
Where manufacturer entered into a
contract with the Navy Department to
construct certain units of a ship accord-
ing to a specific price per pound of units
supplied, but after work had started on
construction manufacturer found out that
the price stipulated In contract was far
too tow and manufacturer timed triune.
diate prospect of being forced out of
business by losing contract, and the
Navy Department and manufacturer then
entered into conferences and an amend-
ed contract was made to include cost of
work on a cost basis and manufacturer
was paid in full for the work already
done and manufacturer proceeded with
performance of the contract as modified,
manufacturer could not recover on any
breaches that might have occurred before
the modification of contract. Merrill.
Stevens Dry Dock & Repair Co. v U. S.
1951, 90 F.Supp. 464, 119 Ct.CI. 310.
Where manufacturer ' entered Into a
contract with the Navy Department for
the construction of certain units of a
ship, but the parties caused contract to
be amended and modified to the extent
that manufacturer operated under a new
contract, even though the causes of ac-
tion that manufacturer might have had
on account of breaches of original con?
tract did not survive the execution.
amendment and modification of contract.
manufacturer was entitled to recover
costs incurred before modification date
which were properly allocable to produe?
nen after that date. Id.
Provision of former section 611 of Ap-
pendix to this title authorizing President
to authorize governmental agencies to.,
amend contracts if such action would fa-
cilitate prosecution of war applied only
to pending and future contracts, and did
not authorize modification of contract
under which work had been completed
and accepted and final voucher issued
prior to passage of such former section
611. Centaur Coast. Co. v. U. S., 1947, 69 ?;'?
F.Supp. 217, 107 Ct.CI. 498, certiorari de-
nied 68 S.Ct. 56, 332 U.S. 757, 92 LIM. ,
343.
9. Performance of contracts?Time for
In action by contractor on war housing
project for Increased costs because of
compelled Saturday work due to Ex.Ord.
No.9301, Feb. 9, 1943, 8 P.R. 1825, requir?
lag a 48 hour week, evidence did not es-
tablish that plaintiff had not proved it
could have completed its contract within
the contract time if it had worked only a.
40 hour week. John A. Johnson Contract-.
ing Corp. v. TJ. S., 1951, 98 F.Supp. 154,
119 Ct.C1. 707.
In action by contractor on war hous-
ing project for increased costs in per-
forming the contract because of COM-
pelled Saturday work due to Ex.Ord.
No.9301, Feb. 9, 1943, 8 F.R. 1825, requir-
ing a 48 hour week, evidence did not es-
tablish that the government agents grant-
ed the contractor extensions of time to
which it was not entitled under the con-
tract, and where it was entitled to them,
they were required to be added to the
original contract period in order to de-
termine whether the contractor could
have completed the contract on time if it
had worked a 5 day week. Id.
10. -- Delays
In war housing project contractor's ac-
tion for excess costs resulting from delay,
wherein the government counterclaimed
for overpayment, where it appeared that
150
WAR
contractor had been put
expense, but mostly as res
material shortages linked
dltions and to essential,
sign orders issued in c
waging of all-out war; al
overpayment, might have
a concession Wade be.ci
trouble nnd expense to
tor had been subjected. C
would, in confused state
inclined to leave partie,s
them. Barnes v. U. S.. 19
817, 123 Ct.CI, 10/.
Where delay in perforz
tract WaS due to the opi
priority and allocatien sys
by the Government during
ocl, under the provisions 0
in suit the defendant is
loss and damages suffered
tractor, and plaintiff is e
cover. Universal Power 0
1918,112 Ct.CI, 97.
11. Adjustments in price
Where an amendment tc
contract was granted undei
tion 611 of Appendix t
not in order to make contrael
to prevent impairment of
productive ability, and to
nation/ defense, contractor
titled to any adjustment in
than that granted by the
justment Board on any thee
sideration of certain items
cost were -not taken into
arriving at the adjustment i
v. U S., 1957 153 F.Supp.
677, certiorari denied 78 S.Ct.
953, 2 L.Ed.2d 530.
In determining whether a
pany which had entered :
contracts with the Army we:
any equitable adjustment .
prices clue to unforeseen I
costs, consideration would 1
other contracts entered into
company and the governm
Performance of contracts 11
Cooper Tire & Rubber Co. v.
15to te.Supp. Mo. 138 Ct.C1. 539.
Denial of relief to the contr,
way of ndjustment of contracl
the government is a matter of
government agency charged
adjustment tinder amendment
section 611 of Appendix to thi
denial of such relief gave rise-
or equitable claim. Id.
Where Government contract.
for revision in price after deny
of articles contracted for. Was
for contractor's default before
80% of articles had been OCCf
tractor was not entitled to rei
supplemental contract revisin
unit price for articles furnis]
? unterminated portion of orlgint
was without ?consideration. COA
America v. U. S.. 1952. 105 P.
123 Ct.CI. /TM
12. -- Reductions -
Contracting officer for Unit
had authority under former si
of Appendix to this title ani
No.9001. Dec. 27, 1941, 6 F.R.
amended, issued ptirsitant th
i
agree to reduction n price to tat
prisoner of war labor. U. "
Packing Ass'n, C.A.F1a.1952, 197
certiorari denied 73 S.Ct 106.
894 97 LEa 670.
13. Agents?Contractors as go
A contract to design and cum
a cost-plus-a-fixed -fee basis
nonce plant for the United S
Property owned by it made en
independent contractors rather ti
eminent agents. Itosecrans v.
ONAL DEFENSE
that such action will facilitate national
defense or prosecution of war where such
relief depends entirely on administrative
determination that such relief will facili- -
tato national defense, Evans Reamer &
Mach. Co. V. U. S., 1967, 386 F.2d 873,
181 Ct.C1. 539, certiorari denied 88 S.Ct.
1102, 309 U.S. 982, 19 I,Ed.2d 1279.
Where manufacturer entered into a
contract with the Navy Department to
construct certain units of a ship accord-
ing to a specific price per pound of units
supplied. but after work had started on
construction manufacturer found out that
the price stipulated In contract was far
too low and manufacturer faced imine-
chafe prospect of being forced out of
business by losing contract, and the
Navy Department and manufacturer then
entered Into conferences and an amend-
ed contract was made to include cost of
work on a cost basis and manufacturer
was paid in full for the work already
done and manufacturer proceeded with
performance of the contract as modified,
manufacturer could not recover on any
breaches that might have occurred before
the modification of contract. Merrill-
Stevens Dry Dock & Repair Co. v U. 8..
la51, 06 F.Supp. 434, 119 Ct.C1. 310. .
Where manufacturer ' entered into a
contract with the Navy Department for
the construction of certain units of
ship, but the parties caused contract to
be amended and modified to the extent
that manufacturer operated under a new. .
contract, even though the causes of ac- -
don that manufacturer might have had
on account of breaches of original con-
tract did not survive the execution,
amendment and Modification of contract,
manufacturer was entitled to recover
costs incurred before modification date
which were properly allocable to produc-
tion after that date. Id.
Provision of former section 611 of Ap-
pendix to this title authorizing President
to authorize governmental agencies to
amend eontracts if such action wouldfa-
? 1
3,
Cf
)3
It-
nt
:v-
cii ti
ltate prosecution of war pp
ice .
of to pending and future contracts, and. did
of not authorize modification of contract
under which work had been completed
by and accepted and final voucher issued-_
et, prior to passage of such former section
tt,
611. Centaur Const. Co. v. U. S., 1917, 69
ad- F.Supp. 217, 107 Ct.C1. 498, certiorari de-
the nied 68 S.Ct. 56, 332 U.S. 757, 92 L.Ed.
-re- 313.
the 9. Performance of contracts?Time for
iW In action by contractor on war housing
Project for increased costs because of
compelled Saturday work due to Ex.Ord.
ilia] No.9301, Feb. 9, 1943, 8 F.R. 1825, requir-
igh. ing a 48 hour week, evidence did not es-
erer tablish that plaintiff had not proved it
tion could have completed its contract within
that the contract time if it had worked only a
atm, 40 hour week. John A. Johnson Contract-
, to ing Corp. v. U. S., 1951, 98 F.Supp. 154,
'per. 119 Ct.C1. 707.
10.2d In action by contractor on war hous-
ing project for increased costs in per-
hi of forming the contract because of com-
ment pelted Saturday work due to Ex.Ord.
27, No.9301, Feb. 9, 1943, 8 F.R. 1825, requir-
men- I ing a 48 hour week, evidence did not es-
cern- tablish that the government agents grant-
ed the contractor extensions of time to
icure. which it was not entitled under the con-
zialig- tract, and where it was entitled to them,
,. 505. they wero required to be added to the
original contract period in order to de-
co?,, termine whether the contractor could
, had have eonipleted the contract on time if it
es to had worked a 5 day week. Id.
apalni 10. ? Delays
First In war housing project contractor's ac
1111 et tion for excess costs resulting from delay.
?.h au- wherein the government counterclaimed
smiling for overpayment, where it appeared that
150
WAR AND NATIONAL DEFENSE 50 ? 1431
con rae or had been put to considerable
expense, hut mostly as result of labor and
material shortages linked to wartime con-
ditions and to essential, general, sover-
eign orders issued in connection with
waging of all-out war; and that claimed
overpayment, might have been partially
a concession made because of extra
trouble and expense to which contrac-
tor had been subjected. Court of Claims
would, in confused state of record. be
inclined to leave parties where it found
them. Barnes v. U. S.. 1052, 105 F.Supp
817, 123 Ct.C1. 101.
Where delay in performance of con-
tract was due to the operation of the
priority and allocation system instituted
by the Oovernment during the war peri-
od, under the provisions of the contract
in suit the defendant is liable for the
loss and damages suffered by the con-
tractor, and plaintiff Is entitled to re-
cover. Universal Power Corp. v. U. S.,
1948, 112 Ct.CI. 97.
11. Adjustments in price -
Where an amendment to contractor's
contract was granted under former sec-
tion 611 of Appendix to this title
not in order to make contractor whole, but
to prevent Impairment of contractor's
productive ability, and to facilitate the
national defense, contractor was not en-
titled to any adjustment in price other
than that granted by the Contract Ad-
jitatment Board on any theory that con-
sideration of certain items of increased
cost were not taken Into account in
arriving at the adjustment flounders Co
V. IT S. 1057 153 F.Supp. 381. 139 Ct.C1.
677, certiorari denied 78 S.Ct., 538, 355 U.S.
953, 2 L.Ed.2d 530.
In determining whether a rubber com-
pany which had entered into certain
contracts with the Army was entitled to
any equitable adjustment in contract
prices due to unforeseen increases in
costs, consideration, would be ?given to
other contracts entered into between the
company- and- the government during
performance of contracts in question.
Cooper Tire & Rubber Co. v. U. S., 1937,
150 teSupp. 840. 138 Ct.C1, 539.
Denial of relief to the contractor in the
way of adjustment of contract price with
the government Is a matter of right with
government agency charged with such
adjustment under amendment to former
section 611 of Appendix to this title, and
denial of such relief gave rise- to no legal
or equitable claim. Id. .
Where Government contract providing
for revision in price after delivery of 30%
of articles contracted for, was terminated
for contractor's default before delivery of
30% of articles had been accepted, ron?
tractor was not entitled to revision, and
supplemental contract revising upward
unit price for articles furnished under
unterminated portion of- original con tract
was without consideration. Coat Corp. of
America v. U. S.. 1952. 105 F.Supp 832.
123 Ct.C1. 176.
12. ? Reductions
Contracting officer for United States
bad authority under former sectien 611
of Appendix to this title and Ilx.Ord.
No.9001, Dec. 27, 1941. 6 P.R. 6787, as
amended, issued pursuant thereto, to
agree to reduction in price to be paid for
prisoner of war labor. U. S. v. Adams
Packing Ass'n, C.A.Fla.1952, 197 F.2d 33,
certiorari denied 73 S Ct. 106. 344 U.S
865, 97 L. Ed. 670
13. Agents?Contractors as government
A contract to design and construct on
a eost-plus-a- fixed-fee basis an ord.
nonce plant for the United States on
property owned by it made centraetors
independent contractors rather than gov-
ernment agents, ltosecrans v. William
Note 15
S. Loner, Inc., C.C.A.Mo.1944, 142 F.2d
118.
Tentative negotiations on the contrac-
tor's request for extra-contractual relief
under this chapter would not serve to
toll the statute of limitations applicable
to claims under the contract. Henry
Products Co. v. U. S., 1967, 180 Cf-Cl. 928.
11. -- Employment
Federal Reserve Bank was authorized
as fiscal agent of the United States to
guarantee payment to banks, which were
financing World War II housing project,
of 90% of any deficiency by builders In
view of executive order, promulgated un-
der former section 611 of Appendix to
this title providing that any Fed-
eral Reserve Bank is authorized to act
as agent of the War Department which
grant of authority was subsequently rat-
ified by statute. Hart v. Federal Re-
serve Bank of Atlanta, C.A.Tenn.1967, 379
P.2d. 961, certiorari denied 88 S.Ct. 849,
390 U.S. 924, 19 L.Ed.2d 983.
An agent hired to have paint manufac-
turer's name added to government's list
of possible contractors aided company to
"secure" contract for sale of camouflage
paint to government within Ex.Ord.No.
9001, Dec. 27, 1911, 6 P.R. 6787, as amended
requiring contract to contain warranty
that contractor has not employed any
person to "secure" contract upon an
agreement for a contingent commission.
Mitchell v. Flintkote Co., C.A.N.Y.1951,
185 10.2d 1008.
Ex.Ord.No.0001, Dec. 27, 1911, 6 P.R.
6787, as amended, requiring contractor
to warrant. that it had employed
no contract solicitor, established federal
policy having force of law, as to which
views of state tribunals could not be
regarded as controlling. Browne V. R. &
R. Engineering Co., D.C.De1.1958, 164 P.
Supp. 315, reversed on other grounds 264
P.2d 219,
Ex.Ord.No.9001, Dec. 27, 1941, 6 P.R.
6787, as amended did not prohibit the
employment of agents to procure war
contracts on percentage commission
basis but merely provided that the con-
tract should contain a warranty that the
contractor would not employ other than
a bona fide, established, commercial or
selling agency to obtain the contracts.
Ebeling V. Fred J. Swaine Mfg. Co., Mo.
1948, 209 S.W.2d 892, 357 Mo. 549,
15. Commissions
The rational underlying Ex.Ord.No.9001.
Dec. 27, 1941, 6 P.R. 6787, as amended,
requiring contractor receiving govern-
ment contract to warrant that he has not
employed any person to solicit or secure
the contract upon any agreement for a
commission is to prevent improper con-
duct in ? obtaining government contracts
and to prevent the government from be-
ing overcharged by addition of commis-
sions or contingent fees to the contract
price. U. S. v. _Webber, D.C.De1.1967, 270
F.Supp. 286, affirmed 396 F.2d 381.
A contract between citizens of New
York -state for a commission for negoti-
ating lease of property to the United
States government was valid under fed-
eral rule of public policy, in view of fact
that services were of a legitimate char-
acter and nothing sinister or improper
was contemplated. Leahy v. Brooklyn
Waterfront Terminal Corp., 1947, 69 N.Y.
S.2(1 596, 272 App.Div. 781.
Contract of defendant to pay broker-
age commission for plaintiff's services in
obi airiing war contract was not hivali-
dated or rendered Illegal or against
"Public indiey" by Ex.Ord.tio.9001, Dee.
27, 1941, 6 F.R. 6787 declaring that every
contract entered into pursuant thereto
shouhl contain warrnnty that contractor
had not employed any person to solicit
or procure contract on agreement for
151
50 ? 1431 WAR AND NATIONAL DEFENSE
Note 36
38. Review
This chapter affords an ex gratis reme-
dy to persons providing goods or services
and does not preclude subsequent judicial
relief. Embassy Moving & Storage Co. v.
U. S., 1970, 424 F.2d 602, 191 Ct.C1. 537.
On appeal from judgment dismissing
action for sums due plaintiffs for mate-
rials and labor furnished subcontractor
for performance of work contemplated
by defendant's defense contract with Air
Force Department, defendant was entitled
to rely on provision of former section 611
of Appendix to this title, authorizing
President to authorize government depart-
ments to enter into defense contracts
without regard to statutory requirements,
and President's proclamation of Ex.Ord.
No.10210, Feb. 2, 1951, 16 P.R. 1049, au-
thorizing Defense Department to enter
into such contracts without requiring
payment or performance bonds, in sup-
port of judgment, though District Court
did not rely on said section. Gallaher &
Speck, Inc. v. Ford Motor Co., CA-UI.
1955, 226 P.26 728.
? 1432. Restrictions
Under former section 611 of Appendbtt''
to this title, action of the President, or.i7C-::
agencies to whom he had delegated pow,'
era granted thereunder, was not subjecfr;
to review by the courts, and conferred.no
rights on contractors. Botinders
Ti. S., 1957, 153 F.Supp. 381, 139 Ct.C1.
certiorari denied 78 &Ct. 538, 355 U.S. 953-C
2 G.Ilid.26 530.
Where former section (111f Appendix-tn.
this title authorized amendment of
ermined contracts to facilitate proseen-
tiou of war, peace treaty had not been....
signed, United States troops were in oe
cupation of enemy countries and autho-
rized representative of Treasury Depart-
ment determined in good faith that.
amend
amendment to contracts with fuel oil dis-
tributor permitting higher prices follow-
ing lifting of controls would facilitate
prosecution of World War II, Court of
Claims was without power to review the'
determination and contractor was enti-
tied to payment under contracts. Waller
v. U. S., 1048, 78 F.Supp. 816, 114
610.
Nothing in this chapter shall be construed to constitute authorization
hereunder for?
(a) the use of the cost-plus-a--percentage--of-coat system of con-z,;-,-,
tracting;
(b) any contract in violation of existing law relating to limita-
tion of profits;
(c) the negotiation of purchases of or contracts for property ox 4.
services required by law to be procured by formal advertising and-
competitive bidding;
(d) the waiver of any bid, payment, performance, or other bond.ft
required by law;
(e) the amendment of a contract negotiated under section 2304_,7'
(a) (15) of Title 10 or under section 252(c) (13) of Title 41 to .in
crease the contract price to an amount higher than the lowest re-
jected bid of any responsible bidder; or
(f) the formalization Or an informal Commitment, unless it
found that at the time the commitment was made it was 1mprac4'
ticable to use normal procurement procedures. Pub.L. 85-804. ?
Aug. 28, 1958, 72 Stat. 972.
References in Text. Section 252(e) (13) The President's proclamation of E r.
of Title 41, referred to in subd, (e), was Ord.No.10210, Feb. 2' 1951, 16 P.R. /049,-it
renumbered section 252(c) (14) of Title 41 authorizing Defense Department to enter,
by Publ.. 85-800, ? 2(b), Aug. 28, 1958, 72 into defense contracts without regard to:4-2
Stat. DM statutory requirements and declaring that,-,-:
payment performance or other bonds need
not be required, as authorized by former;:
Index to Notes section 611 of Appendix to this title re
pealed so far as statutory force was co
Generally 3
Bond* 1 ?
Costs pins fixed fee contracts 2
t. Bonds
The provision of former section 611 of
Appendix to this title authorizing
President to authorize government
departments to enter into defense con-
tracts without regard to requirements of
statutes, including section 270a of Title
40, requiring bonds for government con-
tracts, did not restrict President's author-
ity to exemption of contractors from giv-
ing performance bonds only. so that Pres.
ident's Bx.Ord.No.10210 Feb. 1951, 10
P.R. 1049, authorizing Defense Depart-
ment to enter into contracts without re-
quiring either payment or performance
bonds, was not beyond his authority un-
der former section 61.1 as to provision
for waiver of payment bonds. Gallaher
& Speck, Inc. v. Ford Motor Co., C.A.
711.1955, 224 P.28 723.
cerned, all provisions of section 270a etz?:
seq. of Title 40, requiring defense con.-
tractors to give performance and pay-4A
ment bonds. Id.
2. Cost plus fixed fee contracts
Where 000,120 contract to rebuild tent-1.
frames into huts at Fort Sill Military
Reservation was designated an adver-
tisett lump-sum contract based on unit
prices, under former section 611 of Appen-
dix to this title and Ex.Ord.N0.9001, Tit.
2, par. 6, Dec. 27, 1911, 6 FT.. 6787 pro-
hibitimt a so-called cost plus a fixed fee
type of contract, the contract was not a
"cost plus a fixed fee contract" so as to
relieve contractors of Oklahoma use tax-
ation with respect to materials used in
the work., notwithstanding that contrac-
tors had been notified that contract
would be renegotiated under the Renego-
tiation Act, section 1191 of Appendix to
this title. Bowers v. Oklahoma Tax Corn-
III
i salon, D.C.01(1.1913, 51 F.Supp.
156
Approved For Release 2001/09/07 : CIA-RDP76M00527R000700220011-8
WI
a. Generally
It is the duty of ft
cost-plus contract witt
cy to keep adequate
? 1433. Public
era-I; exemptions: t
(a) All actions
matter of public roe
when deemed by hir
(b) All contracts
thority contained in
the Comptroller Gen
representatives shah
ment, have access I
books, documents, r
subcontractors engal
related to such cont
scribed by the Presic
tracts with foreign
head determines, wit
United States or his d
of the United States.
oral of the United Sts
such clause?
(1) where tilt
or agency there?
from making its
examination; -an
(2) where the
? the price and a? v
? States sources, ti
? omission of the c:
If the clause is omitte
ten report shall be fu
28, 1958, 72 Stat. 97
Stat. 851.
1963 Amendment. Subs
89-607 provided for exem
contracts with foreign c
the requirement for an
records clause, such dote
reported to Congress.
Foreign Contractors. Si
tense, Army, Navy, or Ali
designees, to determine, I
lug the authority provide
ment of this section by
exempt certain, contract
contractors from the mg
examination-of-records c
reasonable efforts have 12Y
elude such examination-oi
as required by par. 11 o
Ord.No.10789, and that a
? 1434. Reports ti
(a.) Every departm4
ter shall, by March 1-
taken by that departn
With respect to actic
United States in execs:
(1) name the
(2) state the
(3) describe II
(4) state fura
With respect to (1)
prescribed by the Pre
disclosure of which wo
ION AL DEFENSE
Under former section 611 of Appendif;
to this title, action of the President, or
agencies to whom he had delegated pow...It.'
ers granted thereunder, was not subject-4,
to review by the courts, and conferred.nos'
rights on contractors. Bolinders
U. S., 1957, 153 F.Supp. 381., 139 Ct.C1. 677;,,,Z71,
certiorari denied 73 S'.Ct. 538, 35.5 U.S. OM
2 L.Ed.2d 530.
Where former section 6111 Appendix
this title authorized amendment of gor-74,.
eminent contracts to facilitate prosectu..--,-
tion of war, peace treaty had riot been,,,
signed, United States troops were in
oc-
cupation of enemy countries and autho-
rized representative of Treasury Depart-,:'.:?.
'tient determined in good faith that
amendment to contracts with fuel oil dis-
tributor permitting higher prices follow-
ing lifting of controls would facilitate
prosecution of World War II, Court of
Claims WaS without power to review the
determination and contractor was enti-
tled to payment under contracts. Waller ...
v. U. S., 1948, 78 F.Supp. 810, 1.14 Ct.C1.
610.
construed to constitute authorization ,
is-a-percentage-of-cost system of con-4a
on of existing law relating to limita-,
'hazes of or contracts for property or
e procured by formal advertising and
? payment, performance, or other bond
ontract negotiated under section 230
section 252(c) (13) of Title 41 to-in-
in amount higher than the lowest re-
)idder; or
.n informal commitment, unless it is
:tommitment was Made it was imprac-?
ment procedures. Pub.L. 85-804, ? 2
is
11
The President's proclamation of Ex
Ord.No.10210, Feb. 2, 1951, 16 F.R. 1o49,
authorizing Defense Department to enter
into defense contracts without regard tot...,
statutory requirements and declaring that...,
payment performance or other bonds need*
not be required, as authorized by former
section 611 of Appendix to this title re-
pealed so far as statutory force was con-
cerned, all provisions of section 270a et
seq. of Title 40, requiring defense con-
tractors to give performance and pay-
ment bonds. Id.
of 2. Cost plus fixed fee contracts
rig Where $900,120 contract to rebuild tent-4,-
nt frames into huts at- Fort Sill Military r*t.
Reservation was designated an adver- *-
of Used lum p - sum contract based on unit .
tie prices, under former section 611 or Appen.--
m- dix to this title and Dx.Ord.No.9001, Tit.
2, par. 6, Dec. 27, 1041, 6 F.11. 6781 pro-
hibiting a so-called cost plus a fixed fee
type of contract, the contract was not a
16 "cost plus a fixed'fee contract" so 11:-r to
rt- relieve contractors of Oklahoma use tax-
re- ation with respect to tnaterials used in
tee the work, notwithstanding that contrite-
in tors lied been notified that contract
1011 weuld he renegotiated under the Renego-
aer tiation Act, ti?.11011 1191 of Appendix to
this title. Bowers v. Oklahoma Tax Corn-
9.(2.01:1.1.913, 51 F.Supp. 652.
156
WAR AND NATIONAL DEFENSE 50 ? 1434
3. Generally actual costs reported, and to keep doe-
It is the duty of a contractor tinder a uments to substantiate its claims for re-
cost-plus contract with government Ewen- imbursements. Sherwood Distilling Co
cy to keep adequate records to Justify v. Ryan, Em.App.1951. 190 10.2d 314.
? 1433. Public record; examination of records by Comptroller Gen-
eral; exemptions: exceptional conditions; reports to Congress
(a) All actions under the authority of this chapter shall be made a
matter of public record under regulations prescribed by the President and
when deemed by him not to be detrimental to the national security.
(b) All contracts entered into, amended, or modified pursuant to au-
thority contained in this chapter shall include a clause to the effect that
the Comptroller General of the United States or any of his duly authorized
representatives shall, until the expiration of three years after final pay-
ment, have access to and the right to examine any directly pertinent
books, documents, papers, and records of the contractor- or any of his
subcontractors engaged in the performance of and involving transactions
related to such contracts or subcontracts. Under regulations to be pre-
scribed by the President, however, such clause may be omitted from con-
tracts with foreign contractors or foreign subcontractors if the agency
head determines, with the concurrence of the Comptroller General of the
United States or his designee, that the omission will serve the best interests
of the United States. However, the concurrence of the Comptroller Gen-
eral of the United States or his designee is not required for the omission of
such clause-
(1) where the contractor or subcontractor is a foreign government
or agency thereof or is precluded by the laws of the country involved
from making its books, documents, papers, or records available for
examination; and
(2) where the agency head determines, after taking into account
the price and availability of the property or services from United
States sources, that the public interest would be best served by the
omission of the clause.
If the clause is omitted based on a determination under clause (2), .a writ-
ten report shall be furnished to the Congress. Pub.L. 85-804, ? 3, Aug.
28, 1958, 72 Stat. 972, amended Publ.,. 89-607, ? "3, Sept. 27, 1966, 80
Stat. 851.
1066 Amendment. Subsec. (b). l'ub.L.
89-007 provided for exemption of certain
contracts with foreign contractors from
the requirement for an examination-of-
records clause, such determination to be
reported to Congress.
Foreign Contractors. Secretaries of De-
fense, Army, Navy, or Air Force, or their
designees, to determine, prior to exercis-
ing the authority provided in the amend-
ment of this section by Pub.L. 89-607 to
exempt certain contracts with foreign
contractors from the requirement of an
examination-of-records clause, that all
reasonable efforts have been made to in-
clude such examination-of-records clause,
as required by par. 11 of Part I of Ex.
Ord.No.10789, and that alternate sources
of supply are not reasonably available,
see par. 11 of Part I of Ex.Ord.No.
10789, Nov. 14, 1958, 23 F.R. 8397, as
amended, set out as a note under section
1431 of this title.
Exemption of Functions. Functions
with respect to purchases authorized to
be made outside the limits of the United
States or the District of Columbia under
the Foreign Assistance Act of 1961, as
amended, as exempt, see Itlx.Ord.No.11223,
May 12. 196.5, 30 F.R. 6635, set out as a
note under section 2393 of Title 22, For-
eign Relations and Intercourse.
Legislative History. For legislative
history and purpose of Pub.L. 89-607,
see 1966 U.S.Code Cong. and Adm.News,
p. 3063.
fi 1434. Reports to Congress; publication
(a) Every department and agency acting under authority of this chap-
ter shall, by March 15 of each year, report to Congress all such actions
taken by that department or agency during the preceding calendar year.
With respect to actions which involve actual or potential cost to the
United States in excess of $50,000, the report shall-
(1) name the contractor;
(2) state the actual cost or estimated potential cost involved;
(3) describe the property or services involved; and
(4) state further the circumstances justifying the action taken.
With respect to (1), (2), (3), and (4), above, and under regulations
prescribed by the President, there may be omitted any information the
disclosure of which would be detrimental to the national security.
157
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50 ? 1434 WAR AND NATIONAL DEFENSE
(b) The Clerk of the House and the Secretary of the Senate shall cause
to be published in the Congressional Record all reports submitted pursu-
ant to this section. Pub.L. 85-804, ? 4, Aug. 28, 1958, 72 Stat. 972.
? 1435. Effective period
This chapter shall be effective only during a national emergency de-
clared by Congress or the President and for six months after the termi-
nation thereof or until such earlier time as Congress, by concurrent reso-
lution, may designate. Pub.L. 85-804, ? 5, Aug. 28, 1958, 72 Stat.
973.
? 1436. Reporting requirements--Definitions
(a) As used in this section?
(1) The term "former military officer" means a former or retired
commissioned officer of the Armed Forces of the United States who?
(A) served on active duty in the grade of major (or equivalent)
or above, and
(B) served on active duty for a period of ten years or more.
(2) The term "former civilian employee" means any former civilian
officer or employee of the Department of Defense, including consultants
or part-time employees, whose salary rate at any time during the three-
year period immediately preceding the termination of his last employment
with the Department of Defense was equal to or greater than the minimum
salary rate at such time for positions in grade GS-13.
(3) The term "defense contractor" means any individual, firm, cor-
poration, partnership, association, or other legal entity, which provides
services and materials to the Department of Defense under a contract
directly with the Department of Defense.
(4) The term "services and materials" means either services or ma-
terials or services and materials and includes construction.
(5) The term "Department of Defense" means all elements of the
Department of Defense and the military departments. ?
(6) The term "contracts awarded" means contracts awarded by ne-
gotiation and includes the net amounted modifications to, and the exercise
of options under, such contracts. It excludes all transactions amounting
to less than $10,000 each.
(7) The term "fiscal year" means a year beginning on 1 July and
ending on 30 June of the next succeeding year.
Former military and civilian officials employed by defense contractors;
Department of Defense employees previously employed by -
defense contractors - ?
(b) Under regulations to be prescribed by the Secretary of Defense:
- (1) Any former military officer or former civilian employee who
during any fiscal year,
(A) was employed by or served as a consultant or otherwise
to a defense contractor for any period of time,
(B) represented any defense contractor at any hearing, trial,.
appeal, or other action in which the United States was a party
and which involved services and materials provided or to be pro-
vided to the Department of Defense by such contractor, or
(C) represented any such contractor in any transaction with
the Department of Defense involving services or materials pro-
vided or to be provided by such contractor to the Department of
Defense,
shall file with the Secretary of Defense, in such form and manner
as the Secretary may prescribe, not later than November 15 of the
next succeeding fiscal year, a report containing the following informa-
tion:
(1) His name and address.
(2) The name and address of the defense contractor by whom
he was employed or whom he served as a consultant or otherwise.
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WAR A
(3) The tit
contractor,
(4) A brief
by him for the
(5) His mi
salary rate wh
case may be.
(6) A brief
by him while ea
of Defense dux
his release fro
employment, AS
(7) The dat
the termination
of Defense, as
ployment, as as
fense contract?
fense contraeto:
defense contrac
(8) Such 0th
fense may requ
(2) Any employe,
sultants or part-tims
served as a consults
- fiscal year, and wife
equal to or greater
grade GS-13, shall
and manner and at f
port containing the
- (1) His slam(
(2 y- The title
, (3) A brief
s of Defense.
(4) The nem,
he was employed
(5) The title
(6)-A brief d
by him for the d
(7) The date
otherwise with
which his emplc
Department of
(8) Such 0th
Defense may req
(c) (1) No former mil
be required to file a repor
he was employed .by or SE
contractor if, the total au
of Defense to such contrac
and no employee of the D
report under this section f
or served as a consultant
amount of contracts awat
Defense during such year
(2) No former military
required to file a report u
of active duty performed
the Department of Defensf
nated three years or snore
DEFENSE
a.ry of the Senate shall cause
all reports submitted pursu-
g. 28, 1958, 72 Stat. 972.
,g a national emergency de-
six months after the termi-
longress, by concurrent reso-
5, Aug. 28, 1958, 72 Stat.
Lions
means a former or retired
of the United States who?
ade of major (or equivalent) I,
ii of ten years or more.
i" means any former civilian
)efense, including consultants
at any time during the three-
'nation of his last employment
or greater than the minimum
e GS-13.
axis any individual, firm, cor-
r legal entity, which' provides
of Defense under a contract
means either services or ma
-
a construction.
e" means all elements of th
partments.
,arm contracts awarded by ne-
Jodifications to, and the exercise
:des all transactions amounting
WAR AND NATIONAL DEFENSE 50 ? 1436
(3) The title of the position held by him with the defense
contractor.
(4) A brief description of his duties and the work performed
by him for the defense contractor.
(5) His military grade while on active duty or his gross
salary rate while employed by the Department of Defense, as the
case may be.
(6) A brief description of his duties and the work performed
by him while on active duty or while employed by the Department
of Defense during the three-year period immediately preceding
his release from active duty or the termination of his civilian
employment, as the case may be.
(7) The date on which he was released from active duty or
the termination of his civilian employment with the Department
of Defense, as the case may be, and the date on which his em-
ployment, as an employee, consultant, or otherwise with the de-
fense contractor began anti, if no longer employed by such de-
fense contractor, the date on which such employment with such
defense contractor terminated.
(8) Such other pertinent information as the Secretary of De-
fense may require.
(2) Any employee of the Department of Defense, including con-
sultants or part-time employees, who was previously employed by or
served as a consultant or otherwise to a defense contractor in any
fiscal year, and whose salary rate in the Department of Defense is
equal to or greater than the minimum salary rate fo-r positions in
grade GS-13, shall file with the Secretary of Defense, in such form
and manner and at such times as the Secretary may prescribe, a re-
port containing the following information:
.(1) His name and address.
(2)- The title of hie position with the Department of Defense.
? (3) A brief description., of his duties with the Department
, oLDefense.
(4) The name and address of the defense contractor by whom
he was employed or whom he served as a consultant or otherwise.
(5) The title of his position with such defense contractor.
(6) A brief description of his duties and the work performed
.by him for the defense contractor. _
(7) The date on which his employment as a consultant or
otherwise with such contractor terminated and the date on
which his employment as a consultant or otherwise with the
Department of Defense began thereafter..
(8) Such other pertinent information as the Secretary of
Defense may require.
year beginning on 1 July and
ear.
ployed by defense contractors;'.
previously employed by '
storm
ii by the Secretary of Defense:
T former civilian ,employee who
Jed as a consultant or, otherwise
eriod of time,
contractor at any hearing, trial,.
fi the United States was a party
' materials provided or to be pro-
Pense by such contractor, or
?ntractor in any transaction with
olving services or materials pro-
contractor to the Department of
fense, in such form and manner
I later than November 15 of the
containing the following informa-
)f the defense contractor by whom
nved as a consultant or otherwise.
Exceptions
( C ) (1) No former military officer or former civilian employee shall
be required to file a report under this section for any fiscal year in which
he was employed .by or served as a consultant or otherwise to a defense
contractor if the total amount of contracts awarded by the Department
of Defense to such contractor during such year was less than $10,000,000;
and no employee of the Department of Defense shall be required to file a
report under this section for any fiscal year in which he was employed by
or served as a consultant or otherwise to a defense contractor if the total
amount of contracts awarded to such contractor by the Department of
Defense during such year was less than $10,000,000.
(2) No former military officer or former civilian employee shall be
required to file a report under this section for any fiscal year on account
of active duty performed or employment with or services performed for
the Department of Defense if such active duty or employment was termi-
nated three years or more prior to the beginning of such fiscal year; and
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50 ? 1436 WAR AND NATIONAL DEFENSE
no employee of the Department of Defense shall be required to file a report
under this section for any fiscal year on account of employment with or
services performed for a defense contractor if such employment was termi-
nated or such services were performed three years or more prior to the-
effective date of his employment with the Department of Defense.
(3) No former military officer or former civilian employee shall be re-
quired to file a report under this section for any fiscal year during which
he was employed by or served as a consultant or otherwise to a defense
contractor at a salary rate of less than $15,000 per year; and no employee
of the Department of Defense, Including consultants or part-time em?
ployees, shall be required to file a report under this section for any fiscal
year during which he was employed by or served as a consultant or other-
wise to a defense contractor at a salary rate of less than $15,000 per year.
Reports to Congress
(d) The Secretary of Defense shall, not later than December 31 of
each year, file with the President of the Senate and the Speaker of the
House of Representatives a report containing a list of the names of persons
who have filed reports with him for the preceding fiscal year pursuant to
subsections (b) (1) and (b) (2) of this section. The Secretary shell-
'-include after each name so much information as he deems appropriate and
shall list the names of such persons under the defense contractor for whom
they worked or for whom they performed services.
Termination of employment; filing reports under subsection (ii) (1) or (2)
(e) Any former military officer or former civilian employee whose_
employment with or services for a defense contractor terminated during
any fiscal year shall ?be required to file a report pursuant to subsection
(b) (1) of this section for such year if he would otherwise be required to
file under such subsection; and any person whose employment with or-
services for the Department of Defense terminated during any fiscal year
shall be required to file a report pursuant to subsection (b) (2) of this.,. ,
section for such year if he would otherwise be required to file under such ;-
subsection.
Recordkeepingl availability of information
(0( The Secretary shall maintain a file containing the information
filed with him pursuant to subsections (b) (1) and (b) (2) of this section -
and such file shall be open for public inspection at all times during the-
regular workday.
Penalties
(g) Any person who falls to comply with the filing requirements of
this section shall be guilty of a misdemeanor and shall, upon conviction
thereof, be punished by not more than six months in prison or a fine of
not more than $1,000, or both.
Commencement date
00 No person shall be required to file a report pursuant, to this section
for any fiscal year prior to the fiscal year 1971.
Pub.L. 91-121, Title IV, ? 410, Nov. 19, 1969, 83 Stat. 210.
Cross Beferences
National apace program, reporting re-
quirements, see section 2462 of Title 42,
Tho Public Health and Welfare.
Approved For Release 2001/09/071RA-RDP76M00527R000700220011-8
WA]
CHAPTER 30.?I
See.
SUBCHAPTER I.?
DATION TO
1451. State enactment o
legislation.
1452. Balloting prneechn
1453. Statistical data.
1454. Personnel residinp
stal lations ; acq
residence for vt
SUBCHAPTER II.--
BIL1TIES OP F
GOVERNM1
1461. Presidential desigt
and facilitate net
Federal fesponsi
1462. Current absentee
Hon.
Absentee voting, see CFR
SUBCHAPT.
- - _
? 1451. State ens(
The Congress exprt
several States take,
enable every person in
. the place of his voting
special, or general ele
is otherwise eligible to
.(1) Members
their spouses and
(2) Members (
their spouses and
(3) Citizens of
territorial limits
and their spouses
lag them.' ?
Aug. 9,1955,-c. 656,
Pub.L. 90-343, ? 3, 82
1968 Amendment. Pub.'
Mated into par. (3) the pr
mer pars. (3) and (4) an
solidated par. (3), substit
which served to extend tl
tions to the states as to
registration so as to Joel
the United States tempc
outside the territorial lim,
ed States and the Distri,
and their spouses and di
residing with or .accompa
former provisions of p,
served to include ciwiltai
the United States in all
log outside the United
District of Columbia and
and dependents when re:
accompanying them, whett
ject to the civil service
Classification Act of Mk
or not paid from fuild,3 a
Congress, and provisions
(4) which served to inclu
rd igloos groups and weiCi
155 U.S.0
1914 P.P.