Mr. MALETZ. Did you instruct Mr. Lawton to return to New York City that night prepared to negotiate a contract with an architect and construction firm?

Mr. STROBEL. No, sir.

Mr. MALETZ. You did not?

Mr. STROBEL. I did not.

Mr. MALETZ. Did you direct Mr. Hunter, Design and Construction, to give Mr. Lawton samples of approved negotiated contracts to use as a guide and to assist him in every way possible?

Mr. STROBEL. That is right.

Mr. MALETZ. Did you indicate to Mr. Lawton that you would call Serge Petroff and James King & Son, a construction firm, to meet Mr. Lawton in New York City on August 27?

Mr. STROBEL. I might have called Mr. Petroff. I don't recall. But I don't recall the reference to King.

Mr. MALETZ. Now, as far as Mr. King is concerned, that was a construction firm

Mr. STROBEL. That is right.

Mr. MALETZ. That Strobel & Salzman had attempted to secure business from; is that right?

Mr. STROBEL. No. I am not so sure about that. I have never done any work for that.

Mr. MALETZ. No. I did not say that you did the work. Did you ever negotiate for business with James King & Son?

Mr. STROBEL. I kind of doubt that. I know personally the man that was in charge. He was a friend of mine.

Mr. MALETZ. Do you recall sending a letter to Mr. Mansure on August 30 setting forth a list of clients, together with a list of firms with which you negotiated?

Mr. STROBEL. Yes, sir.

Mr. MALETZ. Would you refer to that list there a moment, and would you refer to the second part of the list and the firms with which

Mr. ROBB. We do not have the second part of the list here, Mr. Maletz.

Mr. STROBEL. Yes; we do.

Mr. ROBB. Yes; we do. I beg your pardon.

Mr. MALETZ. Would you examine that list to determine

Mr. STROBEL. I see the name of James King.

Mr. MALETZ. You do?

Mr. STROBEL. I see the name of James King on that list.

Mr. MALETZ. And that is the firm with which Strobel & Salzman negotiated for business in the past; is that right?

Mr. STROBEL. Well, I am trying to recall what it was, but I cannot. That is a contracting firm, general contractors.

Mr. MALETZ. Now, do you recall now whether or not you personally called Serge Petroff, telling him to be in Mr. Lawton's office the next day?

Mr. STROBEL. That is possible, that I told him that; yes, sir.

Mr. MALETZ. But you do not recall instructing Mr. Lawton to give the contract to Serge Petroff?

Mr. STROBEL. No, sir. After all, that would be a matter of negotiation.

Mr. MALETZ. You issued no such instruction to Mr. Lawton?

Mr. STROBEL. Not to my recollection; no, sir.

Mr. MALETZ. Your best recollection, then, is that all you did was call Mr. Petroff?

Mr. STROBEL. I referred Mr. Petroff to him; yes, sir.

The CHAIRMAN. Did you in that conversation with Mr. Petroff tell him that he was to be hired as an architect?

Mr. STROBEL. No, sir.

The CHAIRMAN. What did you tell him?

Mr. STROBEL. I might have told him, "There is a rush job to be done on such and such a proposition," and for him to look into it and see if he was interested in it, and to get in touch with Mr. Lawton, because I had nothing to do with it outside of that.

Mr. MALETZ. Did you advise Mr. Lawton that Mr. Petroff was to be instructed to start work immediately?

Mr. STROBEL. I might have instructed Mr. Lawton to start work immediately, but I do not recall any reference to have Petroff start immediately, because that could not be done unless there was some kind of understanding or agreement made by Mr. Lawton or between Lawton and Petroff, because I was not the contracting officer.

Mr. MALETZ. Now, you have no recollection of telling Mr. Lawton also to negotiate with James King?

Mr. STROBEL. No; I don't recall that.

Mr. MALETZ. You are aware of the fact, are you not, that a contract was signed on August 27, the day after your discussion with Mr. Lawton, a contract was signed with Petroff calling for a fee of some $16,000?

Mr. STROBEL. I do not recall that.

Mr. MALETZ. Mr. Chairman, I offer in evidence a contract for professional services dated August 27, 1954, entered into between Public Buildings Service and Serge Petroff, calling for a fee of $16,390.

Are you aware of the fact that a contract was signed shortly thereafter with James King & Son?

Mr. STROBEL. No, I am not aware of the time it was signed.
The CHAIRMAN. That will be accepted.
(The contract referred to is as follows:)

On this twenty-seventh day of August 1954, the United States of America (herein called the Government), acting by and through the Administrator of

General Services, represented by the Regional Director, Region 2, General Services Administration, (herein called the Director), and Serge Petroff, Madison Avenue, New York, N. Y. (herein called the Contract Architect), agree as follows:

ARTICLE I. PROJECT

The project is identified as follows: Alterations to 70 Columbus Avenue, New York, N. Y.

Description

The project will consist of alterations to the tenth, eleventh, and twelfth floors and the roof to provide detention quarters, and to convert the electrical system for the tenth, eleventh, and twelfth floors which use alternating current.

ARTICLE II. SCOPE OF SERVICES

The Contract Architect shall perform all professional services necessary for planning and designing the project as follows:

(a) Preliminary architectural drawings and outline specifications based on sketches and information received from Immigration and Naturalization Service and GSA.

(b) Working drawings and specifications (architectural and mechanical) and Estimate of Cost.

(c) Final working drawings and specifications (reflecting all comments and changes).

(d) The Contract Architect shall:

(1) Furnish copies or originals of items (a) through (b) above, as required by "Instructions to Contract Architects" referred to in Article VII below;

(2) Furnish time schedule and progress reports of his work;

(3) Submit names of engineers (with their records of education and experience) whom he proposes to use on the project, and use only engineers approved by the Director;

(4) Prepay shipping charges on all charts, sketches, drawings and documents he sends to the Director; and after the award of the construction contract;

(5) Prepare any additional explanatory drawings required;

(6) Prepare full-size detail drawings;

(7) Check and approve shop drawings;

(8) Recommend approval of architectural material samples.

(e) Supervision.—The Contract Architect will not supervise the construction of the project.

(f) Ownership.—All drawings, specifications and other documents furnished under this contract, except the perspective sketch, shall be the property of the Government.

ARTICLE III. FEE

The Government shall pay the Contract Architect a fixed fee of $16,390, which shall constitute full compensation for all services and material outlined in - Article II, except as provided in Articles IV and V.

The fee shall be paid as follows and each installment, or portion thereof as provided by Article VIII (c), shall be in full and final settlement for all work performed thereunder :

(a) $3,000.00 when the document required by Article II (a) are approved. (b) $7,500.00 when the documents required by Article II (b) are submitted. (c) $3,000.00 when the documents required by Article II (c) are approved. (d) $2,890.00 when the Director finds that the Contract Architect has satisfactorily completed all the services required.

(e) Prior to the payment under (d) of this Article, the Contract Architect shall furnish the Government with a release of all claims against the Government under this contract, other than such claims as the Contract Architect may except. He shall describe and state the amount of each excepted claim.

(f) The Contract Architect shall have no duties or responsibilities in connection with any furniture or furnishings that are supplied or installed by the Government, and shall receive no compensation on account thereof.

ARTICLE IV. CONSULTATIONS

The Director may require the Contract Architect to furnish consulting services beyond those paid for by the fixed fee. If so, the Government shall pay the Contract Architect as provided in this Article: Provided, That the Contract Architect shall not get any per diem fee for consultations about changes or revisions in the drawings or documents that the Director finds are required because of deficiencies for which the Contract Architect is responsible nor for consultations required to establish the specific requirements of the project. The Government shall pay the Contract Architect for consulting services, authorized by the Director, as follows:

If the services are performed in the city where the architectural work is done, at the rate of $35.00 per day.

ARTICLE V. REVISIONS

(a) Without additional fee, the Contract Architect shall correct or revise the drawings and documents until the Director approves them in writing.

(b) The Government will pay an additional fee for changes or revisions required by the Director after approval of any material submitted: Provided, That the Government will not pay additional fee for any corrections or revisions (even though required after approval of any material submitted) if the Director finds that such requirement resulted from deficiencies for which the Contract Architect was responsible.

(c) Such additional fee shall be the actual amount the Contract Architect pays for technical services of engineers, draftsmen, and other technical personnel, and payments required by law. To the total of these payments there shall be added an amount equal to one and one-half times to total of such payment to cover in full the Contract Architect's supervision, overhead, and profit. The rate the Contract Architect pays for technical services shall not exceed the current rate paid for comparable services in his office, or in other offices in that area.

(d) The Director may change the basic requirements of the project. If, in the opinion of the Director, this requires major revision or abandonment of drawings or other documents, the Government shall pay the Contract Architect for such revisions or for new drawings or documents required to replace those abandoned, an amount to be agreed upon by the parties hereto.

ARTICLE VI. DATA AND SERVICES FURNISHED BY GOVERNMENT

The Government will furnish:

(a) General Services Administration, Public Buildings Service handbooks, design data, standard details, specification forms, partially completed Project Directive, and other information.

(b) The Government will:

(1) Review all material submitted by the Contract Architect.

(2) Confer with and obtain approvals of occupying agencies.

(3) Duplicate the approved final working drawings, specifications, and full-size details.

(4) Obtain bids, award contracts, approve material samples, and supervise and administer construction of the project.

ARTICLE VII. HANDBOOKS

The Contract Architect warrants that he has read the General Services Administration, Public Buildings Service Handbooks entitled "Instructions to Contract Architects" dated August 1, 1946, and Amendment No. 1, thereto, dated April 1, 1950; also "Drawing Requirements Handbook" dated May 1, 1947. These Handbooks, by reference, are made a part of this contract.

ARTICLE VIII. ABANDONMENT, DEFERMENT, OR TERMINATION

(a) The Director may abandon or indefinitely defer the work at any time he finds it expedient or necessary.

(b) If in the opinion of the Director, the Contract Architect violates any terms or conditions of this contract, or his conduct may jeopardize the Government's interest, the Director may terminate this contract by written notice to the Contract Architect.

(c) If the work is abandoned or deferred or the contract terminated by the Director, the Government shall pay the Contract Architect that proportion of

his installment fee that the amount of acceptable work he has actually done on his current submission of work bears to the whole of that submission. Payment by the Government of such compensation shall be in full and final settlement for all work performed by the Contract Architect. After such payment, all charts, sketches, drawings, and other documents, whether finished or not, shall become the property of the Government.

ARTICLE IX. DISPUTES

Any dispute concerning a question of fact arising under this contract which is not disposed of by agreement shall be decided by the Contracting Officer, who shall reduce his decision to writing and mail or otherwise furnish a copy thereof to the Contract Architect. Within 30 days from the date of receipt of such copy, the Contract Architect may appeal by mailing or otherwise furnishing to the Contracting Officer a written appeal addressed to the Administrator of General Services, and the decision of the Administrator or his duly authorized representatives for the hearings of such appeals shall, unless determined by a court of competent jurisdiction to have been fraudulent or capricious or arbitrary or so grossly erroneous as necessarily to imply bad faith, be final and conclusive: Provided, That if no such appeal to the Administrator of General Services is taken, the decision of the Contracting Officer shall be final and conclusive. In connection with any appeal proceeding under this clause, the Contract Architect shall be afforded an opportunity to be heard and to offer evidence in support of its appeal. Pending final decision of a dispute hereunder, the Contract Architect shall proceed diligently with the performance of the contract and in accordance with the Contracting Officer's decision.

ARTICLE X. REVIEW OF DISPUTES

The foregoing Article entitled "Disputes" is subject to the provisions of P. L. 356, 83rd Cong., approved May 11, 1954, which permits judicial review of the decision of the head of any agency (or his representative or board) under the Disputes clause where it is alleged that such decision is "frudulent or capricious or arbitrary or so grossly erroneous as necessarily to imply bad faith, or is not supported by substantial evidence."

ARTICLE XI. COVENANT AGAINST CONTINGENT FEES

The Contract Architect warrants that no person or selling agency has been employed or retained to solicit or secure this contract upon an agreement or understanding for a commission, percentage, brokerage, or contingent fee, except bona fide employees or bona fide established commercial or selling agencies maintained by the Contract Architect for the purpose of securing business. For the breach or violation of this warranty the Government shall have the right to annul this contract without liability or in its discretion to deduct from the contract price or consideration the full amount of such commission, percentage, brokerage, or contingent fee.

ARTICLE XII. EXAMINATION OF RECORDS

(a) The Contract Architect agrees that the Comptroller General of the United States or any of his duly authorized representatives shall, until the expiration of three years after final payment under this contract, have access to and the right to examine any directly pertinent books, documents, papers, and records of the Contract Architect involving transactions related to this contract. (b) The Contract Architect further agrees to include the following provisions, with appropriate insertions, in all his subcontracts hereunder :

"(Name of Subcontractor) agrees that the Comptroller General Of the United States or any of his duly authorized representatives shall, until the expiration of three years after final payment under prime contract (contract symbol and number) between the United States of America and the Contract Architect, have access to and the right to examine any directly pertinent books, documents, papers, and records of (Name of Subcontractor) involving transactions related to this contract."

ARTICLE XIII. OFFICIALS NOT TO BENEFIT

No Member of or Delegate to Congress, or Resident Commissioner, shall be admitted to any share or part of this contract or to any benefit that may arise therefrom.