tion of nonresponsibility related solely to the invitation which was opened on March 12, 1963. We did not hold, or intend to hold, in our May 21 decision that our "concurrence" extended beyond that particular procurement. In considering this and similar cases involving discretionary determinations of nonresponsibility, our Office has been most careful not to characterize our concurrences of nonresponsibility determinations as de facto debarments. See 14 Comp. Gen. 313; 15 id. 149; B-132311, January 3, 1958; B-144574, April 19, 1961; B-150791, B-150861, April 25, 1963. As a general rule, a prior administrative determination of nonresponsibility is not determinative of a subsequent question of responsibility.

There remains for consideration whether the conviction of S. Kane & Son, Inc., for violation of the Fair Labor Standards Act, 29 U.S.C. 201, et seq. (1952 Ed.), constitutes a proper basis for determining that the corporation is not a responsible bidder under the instant solicitation, or under any future solicitations. There can be no doubt that your Administration, as a contracting agency, may base an initial determination of nonresponsibility upon the evidence of record without advising the bidder of the nature of the evidence and without affording the bidder an opportunity to explain or otherwise defend against such evidence. Although, as we stated in B-150791, B-150861, April 25, 1963, we believe it preferable that such opportunity be given. It is apparent that the continued refusal to award contracts to a particular company on the basis of nonresponsibility subsequent to the initial determination of nonresponsibility could operate to deny the bidder of the right to defend himself against the charge of nonresponsibility and to indefinitely deprive him of procurement awards from your Administration.

As you are aware, subpart 1-1.605 (a) (i) of the Federal Procurement Regulations specifies that conviction for commission of a criminal offense as an incident to obtaining or performing a contract shall constitute cause for debarment, while subpart 1-1.605 (b) (6) assures the contractor of notice and opportunity to be heard, and subpart 1-1.605 (b) (5) requires that the period of debarment shall be for a reasonable, definitely stated period of time commensurate with the seriousness of the offense. Under the circumstances set out in FPR 1–1.605 (a) (i), it is our opinion that protection of the interests of both bidders and the Government requires that the debarment procedures set out in these regulations be invoked and followed at the earliest practicable date following a determination of nonresponsibility. To conclude otherwise would necessarily result in authorizing contracting agencies to continue indefinitely to disregard low bids by successive determinations of nonresponsibility, and without affording the bidder opportunity to be heard.

Where, as in the instant case, an initial determination of nonresponsibility is based upon conviction for commission of a criminal offense from which no appeal has been taken, there would appear to be no valid reason why a written notice of intent to debar should not have been issued contemporaneously with, or immediately following, the determination of nonresponsibility. The records indicate your initial determination that Kane was not a responsible bidder was made on March 20, 1963, and there is no evidence of record that your Administration has, to date, notified the bidder of an intent to debar.

Under the circumstances, we must conclude that, pending issuance to S. Kane & Son, Inc., of a notice of intent to debar, and in the absence of any evidence of lack of responsibility other than that on which rejection of its bids on project Nos. 00222-117, -118, −119, −121, and -122 was based, the company must be considered a responsible bidder within the meaning of that term in 41 U.S.C. 253 (b).

[B-150630, B-150637]

Contracts-Increased Costs-Acts of God, Storms, Etc.

A contractor who claims increased costs in performance of a completed contract for supplying citrus fruit juice to the Veterans Administration because of a freeze that damaged the citrus crop on the basis of the default clause in the contract which relieves the contractor for excess costs for performance failure due to acts of God may not have the default clause which is applicable only to failure to perform invoked as a basis for recovering increased costs in the performance of the contract and, in the absence of a showing that the contractor was required to purchase citrus products from a source of supply unreasonably distant from that contemplated under the contract, the claim for increased costs must be denied. Contracts-Increased Costs-Cost Greater Than Contemplated— Supplier Change

A contractor who had 26 days to obtain stocks to fulfill a eontract for supplying fruit juice before a freeze damaged the citrus crop and who claims losses as a result of having to obtain the fruit for completion of the remaining deliveries at a higher price from a source about 100 miles distant has not acted as a prudent, responsible contractor to be regarded as without fault or negligence to be entitled to relief under the "contemplated source of supply" theory in Dillon v. United States, 140 Ct. Cl. 508, under which a contractor who was required to obtain stocks at an unreasonable distance from the area contemplated by the parties was granted limited relief.

To David Bilgore & Co., Inc., August 9, 1963:

We refer to your claims for additional charges for supplying grapefruit juice, grapefruit and orange juice blend and orange juice under contracts V7018P-4227b and V7018P-4189b with the Veterans Administration (hereafter VA), based on an "Act of God" as set forth in paragraph 11 of Standard Form 32, General Provisions, which was made a part of each contract. Contract V7018P-4227b (hereafter 4227b) was awarded to your firm on December 7, 1962. The

contracting officer reports that the contract covered the following items, with delivery points as indicated:

FSN 8915-170-5125 Grapefruit Juice, Fancy, Grade A, Natural, 46-oz. can at $1.949 per dozen.

Item 1. Somerville, N.J.-9846 doz.

FSN 8915-252-7685 Grapefruit and Orange Juice Blend, Natural, 46-oz. can at $2.099 per doz.

Item 7. Somerville, N.J.-5830 doz.

Item 9. Hines, Ill.-3681 doz.

Item 11. GSA Clearfield, Utah-200 doz.

The subject invitation for bids provided that these items were to be packed from fruit harvested after September 1962 only, and your bid was on the basis of FOB Origin, Clearwater, Florida. The contract award notice stated that the completion date of the contract would be the week of February 18, 1962 [sic 1963].

Contract V7018P-4189b (hereafter 4189b) was awarded to your firm on November 16, 1962, and, as reported by the contracting officer, covered the following items, FOB Origin packed from fruit of the 1962 crop only with delivery as indicated:

FSN 8915-241-2800 Juice, Orange, Canned, Natural Single Strength, Grade A Fancy, 46-oz. cans at $2.39 per dozen.

Item 6. Wilmington, Calif.-2540 doz., delivery wk. of 1-28-63 Item 7. Hines, Ill.-1205 doz., delivery wk. of 12-10-62'

Item 8. Franconia, Va. (Reg. 3)-1200 doz., delivery wk. of 1231-62

Item 9a. Gallup, N. Mex. (Reg. 8)-1000 doz., delivery wk. of 12-31-62

Except where specifically indicated the following facts and circumstances, as reported by the contracting officer, are common to both contracts: On December 19, 1962, Mr. R. H. Pride of your firm telephoned and advised Mr. F. W. Gillow, VA Senior Procurement Agent, that, due to the severity of the Florida freeze on December 13 and 14, 1962, you would be unable to supply the products contracted for and requested cancellation, which was confirmed by your letter of the same date. Immediately upon receipt of your letter of confirmation, the VA contacted the United States Department of Agriculture to ascertain the extent of damage to the citrus crop in the Clearwater, Florida, area which could be used as a guide in considering your request for

cancellation. The reply from the Department of Agriculture indicated that citrus products were in short supply but that it was too early to accurately determine the percentage of loss. On December 26, 1962, Mr. Pride was advised by telephone to submit additional justification for the requested cancellation action pointing out specific details as to the extent of damage caused by the severe weather, and how this had affected your ability to complete the contracts.

By letter of December 29, 1962, to the VA, which was accompanied with clippings from local newspapers, Mr. Pride described the severity of the citrus freeze and its effects and again requested relief from liability connected with these contracts on the basis of an Act of God. Thereafter, by letter of January 4, 1963, you advised the VA, in pertinent part, as follows:

With particular reference to order 63-HI-40453 [contract No. 4189b], on this contract we have remaining unshipped 4740 cases 12/46 oz. Unsweetened Orange Juice. You will recall that we stated we are running orange juice to try and salvage as much of the crop as possible. The cost of this fruit keeps going up, while the yield per box of fruit goes down. The yields per box will be less each day as the damaged fruit becomes dryer, therefore, our costs of producing increase daily. This is particularly true for oranges that will make Grade A Unsweetened Orange Juice since fruit with high brix and high solids, as required to make unsweetened juice, is very scarce it is in great demand and commands top prices. Canners are now quoting 12/46 oz. Unsweetened Orange Juice at $4.25 per case, FOB cannery. In an attempt to fulfill this contract, and in line with our conversation, we feel that we can complete this contract at $3.25 per case, FOB cannery. This, price is $1.00 under the current market, which undoubtedly will be higher as the season progresses. Shipments could be made fairly prompt.

With reference to order 63-HI-40509 [contract No. 4227b], no deliveries have been made against this contract to this date, and the total unshipped quantities called for are 9846 cases 12/46 oz. Unsweetened Grapefruit Juice and 9711 cases 12/46 oz. Unsweetened Grapefruit and Orange Blended Juice. Confirming our conversation, we will make every effort to deliver against this contract at an adjusted price of $3.00 per case for the 12/46 oz. Unsweetened Grapefruit and Orange Blended Juice, FOB cannery. We feel that we could produce these items and get them ready for delivery on or about February 1, 1963.

The contracting officer reports that in response to the request for price adjustments as set forth in your January 4 letter above, Mr. Gillow of the VA advised you by telephone on January 7, 1963, that inasmuch as you were currently producing citrus products, the VA could not relieve you of your contracts or negotiate price increases, but that you could submit a separate claim for the proposed price increases with all pertinent information justifying the same. By letter of January 23, 1963, you expressed your intent to fulfill the terms of the contracts although considerable difficulty was being experienced in doing so. You further indicated that you intended to seek relief under the Act of God provisions of paragraph 11, Standard Form 32. With respect to contract 4227b the contracting officer reports that United States Department of Agriculture certificates of inspection show that all juices furnished were packed in January and February 1963. It is further reported that all shipments on this contract have

been completed, the last one evidently during the week of February 11, 1963. With respect to contract 4189b it is reported that verification of completed deliveries was received by the VA on April 11, 1963.

As to the extent of damage caused by the freeze, the contracting officer reports the following:

4. Under date of January 22, 1963 the U.S. Department of Agriculture Crop Production report states "A sharply reduced citrus crop is now estimated, primarily as the result of the Florida freeze of December 11 thru 14, 1962. Fruit in the interior and on the west coast of Florida was severely damaged. The 19621963 orange crop is estimated at 115 million boxes, down 35 million boxes from last month's estimate, twenty-three million boxes below the 1961-62 crop and 6% below average. The grapefruit crop, at 35 million boxes, is down 18% from last month."

The contracting officer further reports that default action on these contracts under the "Act of God" provisions of paragraph 11 of Standard Form 32 was not felt to be applicable inasmuch as you stated that you were capable and willing to perform provided that you could later file a claim for additional costs resulting from the freeze.

Upon completion of the contracts here involved you submitted two claims in the total amount of $33,104.34 to the Veterans Administration which forwarded them to our Office for settlement as doubtful claims. On contract 4227b the amount claimed is $23,342.94 and on contract 4189b the amount claimed is $9,761.40.

Paragraph 11 of Standard Form 32 (September 1961 Edition) provides, in pertinent part, as follows:

11. DEFAULT

(a) The Government may, subject to the provisions of paragraph (c) below, by written notice of default to the Contractor, terminate the whole or any part of this contract in any one of the following circumstances:

(i) if the Contractor fails to make delivery of the supplies or to perform the services within the time specified herein or any extension thereof; or

(ii) if the Contractor fails to perform any of the other provisions of this contract, or so fails to make progress as to endanger performance of this contract in accordance with its terms, and in either of these two circumstances does not cure such failure within a period of 10 days (or such longer period as the Contracting Officer may authorize in writing) after receipt of notice from the Contracting Officer specifying such failure.

(b) In the event the Government terminates this contract in whole or in part as provided in paragraph (a) of this clause, the Government may procure, upon such terms and in such manner as the Contracting Officer may deem appropriate, supplies or services similar to those so terminated, and the Contractor shall be liable to the Government for any excess costs for such similar supplies or services: Provided, That the Contractor shall continue the performance of this contract to the extent not terminated under the provisions of this clause.

(c) Except with respect to defaults of subcontractors, the Contractor shall not be liable for any excess costs if the failure to perform the contract arises out of causes beyond the control and without the fault or negligence of the Contractor. Such causes may include, but are not restricted to, acts of God or of the public enemy, acts of the Government in either its sovereign or contractual capacity, fires, floods, epidemics, quarantine restrictions, strikes, freight embargoes, and unusually severe weather; but in every case the failure to perform must be beyond the control and without the fault or negligence of the Contractor. If the failure to perform is caused by the default of a subcontractor, and if such default arises out of causes beyond the control of both the Contractor and subcontractor, and without the fault or negligence of either of them, the Contractor shall not be liable for any excess costs for failure to perform, unless the supplies or services to be