________________________________ MOTION FOR SUMMARY RELIEF DENIED September 28, 1995 ________________________________ GSBCA 12296 TMD U.S.A. INC., Appellant, v. GENERAL SERVICES ADMINISTRATION, Respondent. Vincent Schickler, President of TMD U.S.A. Inc., Smithtown, NY, appearing for Appellant. John E. Cornell and Wendy Nevett Bazil, Office of General Counsel, General Services Administration, Washington, DC, counsel for Respondent. Before Board Judges DANIELS (Chairman), WILLIAMS, and VERGILIO. VERGILIO, Board Judge. On February 10, 1993, the Board received this appeal from TMD U.S.A. Inc. The respondent, the General Services Administration (GSA), had received from TMD a tender of rates for ocean freight forwarding services. Orders were placed against the tender agreement. Before the one-year period of the tender expired, the agency noted various problems with the services and billings provided by TMD, and placed TMD in non-use status. TMD maintains in this appeal that the agency breached the agreement by placing it in non-use status, and that TMD is entitled to $49,950 in damages for the alleged breach. The agency has moved for summary relief, contending that undisputed facts establish that TMD failed to act in accordance with its tender agreement, such that the agency properly placed TMD in non-use status. The existing record does not permit the Board to make the factual conclusions relied upon by the agency. Accordingly, the Board denies the motion for summary relief. 2 Findings of Fact 1. By letter dated January 28, 1992, the GSA, Region 3, Federal Supply Service Bureau, requested from ocean freight forwarders a new tender or a supplement to current tenders. Further, "the qualifying low cost forwarder will be selected on January 31, 1992 from the tenders received, that will provide services consistent with the enclosed agreement for the one year period beginning February 1, 1992 and ending January 31, 1993." Exhibit 1.1 2. The agreement includes a specification/work statement, which requires the responding freight forwarder to specify a unit cost which includes the following items: continental United States long distance telephone calls; electronic messages; regular postage; photocopies; general office supplies; and three hours of manpower. The unit price represents a per shipment cost, not tied to the weight or cubic measurement of the shipment. Further, the following are add-on costs when approved by the shipping agency: expedited mail service; marine insurance; blank consular forms; legalization fees; domestic transportation or pickup and delivery charges; and any cost not covered in the unit price agreement. Exhibit 1, Enclosure at 1. The specification/work statement also states: Tenders of Carriers which are not selected will be retained and evaluated for future use in the event either the primary or secondary carriers (1) withdraw their tender (2) the volume of service required exceeds the capabilities of the forwarder in service, or (3) is removed by the Government for any cause. Id. at 2. 3. TMD provided the agency with a completed form, "Uniform Tender of Rates and/or Charges for Transportation Services," with an effective date of February 1, 1992, and an expiration date of January 31, 1993. Under the tender, TMD agrees to provide ocean freight forwarding services in accordance with specified regulations, 48 CFR 47.500 through .507 and 52.247-64, and 41 CFR 101-40.302 through .304, and, as referenced in the findings above, the GSA's Ocean Freight Forwarding Agreement- Specification/Work Statement. Exhibit 2. One factor specified in the regulations to be considered in determining whether a carrier can meet an agency's requirements for a given shipment is the "[r]ecord of past performance of the carrier." 41 CFR 101- 40.303-1(f) (1992). ____________________ 1 All referenced exhibits are in the appeal file. 3 4. Orders were placed under the agreement. Exhibits 3, 4. In July 1993, the agency informed TMD that the agency was experiencing problems with the services and billings of TMD. Exhibits 4, 5, 7. Through November, the agency and TMD engaged in conversations regarding agency-perceived problems. Exhibits 5, 6. 5. In a letter to TMD dated December 4, 1992, the agency explains its decision to place TMD in non-use status: [O]ur Traffic Management Specialists, responsible for overseas shipping, were experiencing problems with your company. These problems were failure to provide documentation to this office and/or our customers, constant errors in billing submissions, and overcharges for overnight express mail. The problems were becoming extremely frustrating and time consuming not only to our staff and the GSA Finance Center in Kansas City, MO, but to our customer agencies as well. You were also informed that because of these ongoing problems, we were strongly considering utilizing other freight forwarders on file with GSA. Based upon the seriousness and repetitive problems associated with 80% of the shipments consigned to TMD, this office has placed your company in a 90 day non-use status effective October 1, 1992. Exhibit 7 at 1.2 In twelve subparagraphs (Findings 6-16), the letter contains a synopsis of the shipments and the perceived problems which formed the basis of the decision to place TMD in non-use status. Id. 6. The agency notes, in one subparagraph of alleged problems: WCA9967, P.O. 3QPN-E-AQ847-1 We received a call from Mr. Bazzrea with Knapp Chevrolet. The Dominican Consulate had contacted him for the vessel name and voyage number assigned to the above shipment. Mr. Bazzrea then contacted TMD who did not have this information and in turn, instructed him to contact this office. One GSA Technician spent over two hours making long distance phone calls to obtain, thence relay this information back to Mr. Knapp. ____________________ 2 The existing record does not demonstrate the accuracy of the assertion that problems were associated with 80% of TMD shipments or what portion of the problems were attributable to TMD. 4 TMD's failure to provide this information was a violation of para. 5(a)3 and 10 of the specification/work statement procedures contained in the GSA Ocean Freight Forwarder Agreement. Exhibit 7 at 1-2 ( a).3 In response to a request for admission proffered by the agency, "Admit that for shipment WCA9967, TMD failed to keep a record of the vessel name and voyage number," TMD states: TMD Denies for WCA9967, TMD failed to keep a record of the vessel name and voyage number. Attached is a copies from our files of a validated "REQUEST FOR DOCK RECEIPT FROM GSA ON WCA9967" from Carol Curtis dated 3/24/92 as stated in their Miscellaneous: No Booking necessary for vehicles per Maui, PRIMMI. Bi-weekly sailing. Also in the instructions to the Supplier of GSA: "Deliver to :1901 Australia Way, Prot of Miami, Florida with the telephone number must be delivered by: 48 hours before sailing. Booking Information: Vessel: - Sailing :: Tues & Fri. BK# No # assigned". This is a copy of the instructions from GSA to us to follow which we did in an expeditious manner to their supplier for their delivery to the ocean carrier. Attached copy of our letter of instructions to GSA's supplier from GSA's instructions to us, a copy of the "Dock Receipt" to the supplier for their delivery at their cost and truck to the pier of export as instructed by GSA a copy of the "Shipping Instruction and Documentation Distribution" with a copy of the on board ocean bill of lading on this shipment which showed the vessel "Guayama voyage 1375 and the (OBL) Ocean bill of lading number once the shipment was on board by the steamship line. How can TMD fail to keep a record of the vessel name and voyage number if it was never booked by GSA or was TMD requested to book the freight by GSA ?. ____________________ 3 The referenced provisions of the specification/work statement direct TMD to maintain records and reports; i.e., the "maintenance of adequate records reflecting the status of each shipment, and recording the receipt, processing, handling and distribution of documents. The reports shall include:" "(3) Name of steamship line and vessel" and "(10) Date vessel sailed." Exhibit 1, Specification/Work Statement at 7 ( 5.a). 5 Once the freight was at the pier from the supplier at their cost and trucking; TMD processed the necessary documentation in order of GSA's instructions and once the ocean bills of lading [w]ere ready from the ocean carrier TMD related this information within our contract to the distribution of documentation as instructed by GSA copies attached as stated above. TMD never was requested by GSA to book any "Ocean Freight" on any past shipments; we did the documentation within this contract as their "Ocean Freight Forwarder["] and if they requested us in writing to book freight or do anything else we did it as to their instructions and our contract. Agency Motion to Compel (Nov. 10, 1994), Attachments A at 9 ( 6), B at 2-3 ( 6). The agency has pointed to no contract provision which required TMD to have provided the information to a non-party to the contract. 7. A subparagraph in support of placing TMD in non-use status states: WCA9992, P.O. #QPN-E-QA802-1 TMD did not annotate any insurance coverage on the original shipment documents; documents and billing were amended on 5/29/92 to include insurance; shipment sailed on 5/6/92; insurance was not effective until 5/8/92. Therefore, the shipment was uninsured for two days. TMD did not submit a receipt for courier service with billing. After repeated phone calls to TMD, DHL receipt #568277765 was received. On 6/19/92, we requested TMD to remail documents to the Comptroller. TMD subsequently remailed them to the wrong address. On 6/24/92, we again requested TMD to remail the documents. Additionally, we were informed that TMD did not forward a copy of the DD1917 to the steamship line. A copy was faxed to the line by this office on 5/19/92. The technician spent a total of six hours on the problems associated with this shipment. Exhibit 7 at 2 ( b). TMD states in response to an agency request for admission, "Admit that shipment WCA9992 was uninsured for two days, due to TMD's failure": TMD Denies that for WCA 9992 shipment was ever under insured for two days due to TMD failure. The value as stated and instructed on GSA's "Application for Shipping Instructions and Notice of Availability" dated 4/22/92 copy enclosed in the box stated: Value of Shipment $8,500.00 times 120 per cent 6 requested on GSA's "Request for Dock Receipt" and for Man Roland Inc to deliver shipment to CCT 2801 NW 74 Ave Miami, Fl by May 6, 1992 (05/06/92) (copy enclosed) and in the Miscellaneous box: (second line) Obtain insurance in the amount of 120%. These instructions came directly from GSA Carol Curtis to us to handle this shipment under our contract as their ocean freight forwarder. The $8,500.00 value of the shipment times 120 per cent is $10,200.00 as agreed and insured under the inclosed copy of a policy with our insurance company Washington International Insurance Company No. 249914. It would seem that the shipment arrived early from the supplier on 4/30/92 yet made the booking for the vessel Amassador voyage 88 as GSA instructed and booked with the line CCT. Enclosed copy of letter from Insurance Agent dated October 26, 1994. Agency Motion to Compel (Nov. 10, 1994), Attachments A at 9 ( 9), B at 3 ( 9). 8. In a subparagraph of alleged problems, the agency specifies: WCA9994, P.O. #UPN-B-A6588-1U The steamship line phoned to inform us that they did not receive a copy of the DD1917 on this shipment from TMD as per agreement. We faxed a copy to the steamship line on 6/17/92. TMD did not submit a receipt for courier service, yet billed GSA $68.00. We requested and received a receipt from TMD which did not show a cost. We then contacted UPS and learned that the cost was $55.00. Approximately 3 additional hours were spent on this shipment. Exhibit 7 at 2 ( c). In response to an agency request for admission, "Admit that for shipment WCA9994, TMD billed GSA $68.00 for shipping when the charge to TMD was only $55.00," TMD states: TMD Denies that on WCA 9994 TMD over billed $68.00 for courier services to send documentation as instructed to the consignee. GSA did not instruct us on this shipment what courier service we were to use. TMD incurred additional expenses to courier the documents to the consignee in using our personnel to bring the courier documents to the courier and the 3 working hours on this shipment as allowed under contract terms was used. This is the reason as 7 explained in past conversations with GSA for the $13.00 time for our messenger to get the documents courier. Agency Motion to Compel (Nov. 10, 1994), Attachments A at 9 ( 7), B at 3 ( 7). 9. In another subparagraph of alleged problems justifying the agency's placement of TMD in non-use status, the agency states: WCA9950 & 9981, P.O. #QPN-E-QA478-1 The 1917 submitted by TMD reflected a cost for the shipment of 16 Jeeps although only 15 actually moved at this time. TMD did not submit a receipt for courier service on this shipment yet billed GSA $51.00. We requested and received a receipt from TMD which did not reflect a charge. However, DHL informed us that the cost for this service was $41.00. The American Embassy did not receive advanced documents from TMD. Therefore, we requested TMD fax or express mail the documents as soon as possible. TMD submitted a second bill for courier service to GSA in the amount of $68.00. Again, no receipt was submitted and per Federal Express, this service should have cost only $39.00. Over a 3 day period, approximately 4 additional hours were spent on this shipment. Exhibit 7 at 2 ( d). In response to a request for admission, "Admit that for shipments WCA9950 and WCA9981 TMD prepared the GSA Form DD191 showing that the shipment was of 16 Jeeps when, in fact, the shipment was only of 15 Jeeps," TMD states: TMD Denies for shipments WCA9950 and WCA 9981, TMD prepared the GSA Form DD1917 showing that the shipment was of 16 Jeeps when in fact, the shipment was only of 15 Jeeps. On WCA 9950 we followed the instructions of GSA on there Form 500-1A copy attached which stated that their were 16 1992 Jeeps also on GSA's Form 1611 hand written in the middle of the form states 16 units Jeep (copy enclosed) and on the copy of the original master ocean bill of lading which TMD processed with the ocean carrier it shows 16 Jeep's (copy attached). Yet the line only received 15 Jeeps from the suppl[i]er delivery and were put on board the vessel Patricia Rickmeo voyage 10 as booked by GSA and instructed by TMD and GSA to be 15 Jeeps. 8 On WCA9981 GSA's instructions did show 16 Jeep's as it is clearly shown yet their was only one (1) Jeep as we have made in accordance with their instruction on Form 500-1A, Form 1611 and on the Ocean carriers bill of lading. TMD do[e]s not understand this question related to the truth of the matter. TMD did as TMD was instructed and completed this shipment under our contract agreement with GSA. Exhibits of documentation from GSA and TMD are attached as stated in the above mentioned answer's to the Request for Admission Number Exhibits attached 26 copies[.] Agency Motion to Compel (Nov. 10, 1994), Attachments A at 9 ( 13), B at 4 ( 13). TMD further responded: WCA9950, WCA9981, and WCA9981: Enclosed: Copy of GSA form on WCA9981 showing their change from 16 Jeeps to 1 (one) jeep, GSA form showing 16 showing their change to 1 (one) jeep. TMD's compliance in the documentation of the dock receipt and on the ocean bill of lading showing one (1) jeep as instructed by GSA. Copy of GSA form on WCA9950 showing 16 Jeeps, another form from GSA showing 16 Jeeps and our dock receipt showing 16 Jeeps to be shipped. It seems that GSA on their forms of WCA 9981 on the top of form number 1611 they crossed out their number WCA9950 which did call for 16 Jeeps and made it WCA 9981 which called for one (1) Jeep. These problems of GSA in their mistakes, misunderstand, communication and their changes have caused us to work allot of hours well over the three man hours allotted on individual shipments under this contract. TMD has been accused unnecessarily of not following their instructions do some thing fraudulent and many other things !. Id., Attachment B at 5 ( 13). 10. In a subparagraph of alleged problems, the agency notes: WCA9967, P.O. #QPN-E-QA847-1 We had to issue a Government Bill of Lading (E- O,821,036) on this shipment of vehicles from Miami, FL to Santo Domingo because TMD does not have a line of credit with the steamship company. We also had to fax 9 a copy of the 1917 to GSA Finance due to TMD's failure to provide the document with their billing package. TMD also failed to submit a receipt for courier service on this shipment, yet billed GSA $60.00. We requested and received a copy of the receipt from TMD, which again did not reflect a charge. UPS informed us that the cost for this service was $10.00. (3 additional hours expended on this shipment). Exhibit 7 at 2-3 ( e). In response to a request for admission, "Admit that for shipment WCA9967, TMD billed GSA $60.00 for United Parcel Service when the charge to TMD was only $10.00," TMD states: TMD Denies that on WCA9967 TMD over billed GSA for courier services where as we had additional expenses to courier the documents by our personnel to bring the courier documents to the courier and had worked over the allotted 3 hours as agreed within the contract for us to also invoice for our expenses. Agency Motion to Compel (Nov. 10, 1994), Attachments A at 9 ( 8), B at 3 ( 8). 11. Two subparagraphs of alleged problems read: WCA9991, P.O. #QPN-E-QA478-2 The steamship line did not receive a copy of the 1917 from TMD. Again, a copy was faxed to them from this office. TMD failed to submit a receipt for courier service on this shipment, yet billed GSA $68.00. We requested and received a copy of the receipt from TMD (which did not reflect a charge). DHL informed us that the charge for this service should have been $41.00. (2 additional hours expended on this shipment). WCA9991, QPN-E-QA478-2 TMD did not submit a receipt for courier service, yet billed GSA $68.00. We requested and received a copy of the receipt, however, we were informed by DHL that the charge for this shipment was $30.00. We also had to issue a GBL for this shipment because TMD does not have a line of credit with the steamship line. A total of 4 additional hours were expended on this shipment. Exhibit 7 at 3 ( f, g). In response to a request for admission, "Admit that TMD routinely overbilled GSA for courier services," TMD states: TMD Denies that on WCA9992, WCA9994, WCA9991 and WCA9966 TMD overbilled GSA for courier services. 10 Agency Motion to Compel (Nov. 10, 1994), Attachments A at 9 ( 11, B at 4 ( 11). 12. A subparagraph of alleged problems states: WCA9966, P.O. #QPN-E-QA802-2 The steamship line did not receive a copy of the 1917 from TMD as per agreement. A technician spent approximately 1 additional hours on this shipment which consisted of logging the complaint from the steamship company, telephoning TMD, and faxing information. Exhibit 7 at 3 ( h). In response to a request for admission, "Admit that for shipments WCA9992, WCA9994, WCA9991 and WCA9966, TMD failed to send the steamship line a copy of the DD1917," TMD denies the assertion. Agency Motion to Compel (Nov. 10, 1994), Attachments A at 9 ( 10), B at 3 ( 10). 13. Another subparagraph of alleged problems informs TMD: WCA9983, P.O. #QPN-E-Y5771-1U TMD failed to submit a receipt for courier service, yet billed GSA $100.00. We requested and received a copy of the receipt from TMD (which did not reflect a charge). A phone call to UPS revealed that the cost should have been $75.00. One additional hour was spent on this shipment. Exhibit 7 at 3 ( i). 14. A subparagraph of alleged problems specifies: WCA9995, P.O. #QPN-EQB009-1 We had to issue a GBL (E-O,821,049) to the steamship line on this shipment because TMD does not have a line of credit with the company. Exhibit 7 at 4 ( j). 15. In a subparagraph of alleged problems justifying the agency's placement of TMD in non-use status, the agency states: P.O. #RPN-E-61832 TMD did not provide the consignee in Cairo, Egypt the necessary documents on this shipment which caused numerous problems at the Egyptian port. The agency's headquarters office in Atlanta, GA contacted TMD to request a copy of the Ocean Bill of Lading in order to claim the vehicle which was being held at the port. TMD informed the agency that there would be an additional charge for these documents. Enraged, the 11 agency coordinator contacted this office for an explanation and immediate action on our part to have this vehicle released at once. After a thorough search of our files, it was discovered that TMD also failed to submit a copy of the shipment documentation to this office as well. Several phone calls were made to TMD (to request that this information be faxed to us), and the customer agency (to reassure them that we would take care of the problem). We were able to fax a copy of the Ocean Bill to Cairo the following day and the vehicle was released a few days later. The agency requested that GSA not consign any future shipments to TMD. Additionally, there were numerous billing problems associated with this shipment. (Three technicians spent a total of 6 hours over the course of 4 days on all the problems associated with this move). Exhibit 7 at 4 ( k). In response to a request for admission, "Admit that for shipment #RPN-E-61832, TMD failed to provide either GSA or the consignee the shipment documentation, including the ocean bill of lading," TMD states: TMD will be very happy to answer this question the only thing is theirs TMD has no reference to #RPN-E-61832 what is the WCA number from GSA may be this is a shipment GSA has given to another Freight Forwarder. Comply with more information as to what the shipment was how many pieces, weight, from what vendor/supplier to the final destination etc. Agency Motion to Compel (Nov. 10, 1994), Attachments A at 9 ( 12), B at 4 ( 12). 16. A subparagraph of alleged problems states: P.O. #RPN-F-65278 TMD submitted several duplicate billings on this shipment which resulted in many hours of additional work and frustration for not only this office, but GSA's Finance Office in Kansas City, MO. After several days, and 9 long distance phone calls, it was finally determined that TMD erred by not submitting a supplemental bill in lieu of duplicates. Exhibit 7 at 4 ( l). 17. Following the subparagraphs of alleged problems, the letter states: Because of the enormous workload in our Traffic Program, our technicians do not have time to spend correcting shipments that should have been handled by 12 your company. Additionally, we feel that the errors in shipment are an embarrassment to GSA. We also, feel that TMD's performance in the handling of the above shipments certainly was not in accordance with the standards and procedures for which you have an obligation. More importantly, your attitude regarding the agreement between your company and GSA is of great concern to me [the Chief, Traffic and Travel Services Branch]. As an approved Freight Forwarder of the General Services Administration, you are bound by the terms and conditions of the GSA/FF Agreement which you have repeatedly violated. Accordingly, GSA, Region 3 has placed TMD in a non-use status for a period of 90 days effective October 1, 1992 per instructions contained in Title 41 of the Code of Federal Regulations, Subpart 101.40.4. Exhibit 7 at 4-5. Discussion TMD maintains that the agency breached the underlying agreement by placing TMD in non-use status and that TMD is entitled to $49,995 as damages resulting from the alleged breach. TMD Submission (July 22, 1993). The agency seeks summary relief on the first issue--the propriety of its placing TMD in non-use status, thereby making moot the second issue. Agency Motion (Apr. 6, 1995). The agency asserts that it is undisputed that TMD failed to adhere to the agreement, as evidenced by the events documented in the agency's letter as set forth in the findings of fact. The existing record does not support the agency's assertion that TMD failed to adhere to the terms of the tender agreement. The TMD denials and statements made in response to the assertions raised in the agency's request for admission reveal unresolved and material factual questions. Further, the existing record does not appear to include all documentation relating to all of the orders placed with TMD, such that it is unclear what directions may have been provided (or not) with particular orders. Decision The Board DENIES the agency motion for summary relief. ______________________________ JOSEPH A. VERGILIO Board Judge 13 We concur: ______________________________ ______________________________ STEPHEN M. DANIELS MARY ELLEN COSTER WILLIAMS Board Judge Board Judge !R! CALL BCA; EXIT; ________________________________ ORDER ON FURTHER PROCEEDINGS September 28, 1995 ________________________________ GSBCA 12296 TMD U.S.A. INC., Appellant, v. GENERAL SERVICES ADMINISTRATION, Respondent. Vincent Schickler, President of TMD U.S.A. Inc., Smithtown, NY, appearing for Appellant. John E. Cornell and Wendy Nevett Bazil, Office of General Counsel, General Services Administration, Washington, DC, counsel for Respondent. VERGILIO, Board Judge. ORDER To date, neither party has focused on what appears to be a fundamental element in the TMD claims. The theory that appears to underlie TMD's claim of breach and for damages is that the tender agreement is a contract between the agency and TMD, and that the agreement assured TMD of all, or some number, of the shipments over the life of the agreement. That such a contract exists is not apparent from the agreement or contentions of the parties. Whether the receipt of the tender constitutes a contract, or the placement of an order creates a contract, directly affects the underlying claims of breach and calculations of alleged damages. From the record (evidentiary and administrative), it is unclear if, or how, the agency may have breached the agreement. Neither party has pointed to a particular provision of the agreement which the agency may have breached. Although the agency accepted from TMD the uniform tender of rates and/or charges for transportation services, no provision appears to obligate the General Services Administration (or other government agency) to utilize the agreement. Thus, even if the agency 2 improperly placed TMD in non-use status, TMD has failed to identify a provision of a contract which was breached or a theory which would serve as a basis to measure or assess damages. The Board directs TMD to file and serve, no later than Monday, October 13, a submission indicating any and all theories on which it relies in support of its assertions of breach of contract and which may serve as a basis for entitlement to monetary relief. ______________________________ JOSEPH A. VERGILIO Board Judge