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The Secretary of War has directed the commanding general, Philippine Department, to gradually evacuate the dependents of personnel of the Military Establishment on duty in the Philippine Commonwealth. The personnel whose dependents are being thus moved without their volition are remaining on duty in the Philippine Commonwealth. That is, the officer remains there; the family comes home.
No authority of law exists for the travel of these dependents without the officer changing station at the same time, nor, for the transportation of their household equipment to such place as may be selected for their sojourn pending the relief of the personnel and assignment thereof to station in the United States. You see, the officer himself has to be ordered to move before transportation for dependents can be provided.
Language is accordingly being proposed which will authorize the Secretary of War until June 30, 1942, to move such dependents of personnel on duty at stations outside the continental limits of the United States and in Alaska to such locations as may be selected by the Secretary of War, and to utilize for this purpose either Government or commercial means of transportation. The urgency of this matter is indicated by the fact that two Army transports each carrying some dependents of personnel being retained in the Philippines are now under way from Manila to San Francisco. Authority should exist to evacuate these dependents beyond San Francisco at the time of their arrival thereat.
For example, we have wives of soldiers in the first three grades who are entitled to get transportation, and those fellows do not have any extra money. Their wives are coming into San Francisco and we have no authority to take care of any of them.
Within definitely prescribed limitations, the statutes otherwise have provided funds for the transportation of the dependents and the household effects of the civilian personnel as well as those of certain grades of the naval (enlisted and commissioned) personnel. Public Law 13, approved March 17, 1941, at page 3, 55 Stat. 34; Public Law 48, approved May 6, 1941, pp. 1, 12, 55 Stat. 161; 34 U. S. C. 896. As a general rule, that authority did not extend to permit either (1) transportation in advance of the order transferring the officer, enlisted man, or employee, or (2) payment of more than the cost by the direct route from the last official station to the new. Executive Order No. 8588, November 7, 1940, sections 11 and 12; 20 Comp. Gen. 568; decision of August 28, 1937, A-88570; February 11, 1939, A-99846; November 1, 1940, B-13187; February 8, 1941, A-88570, B-13187. As will appear from the foregoing statements, the object of the new provision quoted in your letter was to empower the Secretary of the Navy in proper circumstances to make exceptions to those two limitations, so as to permit the dependents and the effects to precede the transfer of the personnel, to be brought to place of "sojourn" in this country not necessarily in the vicinity of the destination of the eventual transfer, and thereafter to be retransported to such destination.
The term "personnel " may include those commissioned or enlisted in the naval service (cf. the "Navy Personnel Act," March 3, 1899, 30 Stat. 1004), while, also, it is a common generic term for the civilian officers and employees of an executive establishment (19 Comp. Gen. 383). Likewise, the "Naval Establishment" may comprehend the field civilian service of the Navy Department (10 Comp. Gen. 216), as well as, a fortiorari, the Navy itself. The provision in question suggests no
differentiation between service and civilian personnel, nor does its legislative background as set out above. Its evident purpose relates to both classifications equally. Thus, in answer to your specific question, it is proper to conclude that the term, "personnel of the Naval Establishment," appearing in the cited act, includes Navy civilian, as well as military, personnel.
However, it is thought proper to point out that the statute does not appear to grant any new rights to any of the classes of Naval or civilian personnel who may not otherwise be entitled to the transportation of their dependents or effects upon transfer of station, or to remove the several limitations with which the law circumscribes those rights, other than the restrictions as to time and route above pointed out. In other words, appropriations for the fiscal years 1941 and 1942 otherwise available, upon change of station, "for travel (of dependents) and transportation (of effects) may be used" within the circumstances specified in the new statute, without reference to those two restrictions. Since the authority for the transportation of household effects of Navy civilian employees was first provided on March 17, 1941 (Public Law 13, supra; 20 Comp. Gen. 421; id. 702), and for their dependents effective July 1, 1941 (Public Law 48, supra), no payments would appear to be authorized for such expenses incurred prior to those respective dates.
BILITY FOR BONUSES TO CONTRACTORS' EMPLOYEES
The authority vested in the Secretary of the Navy by section 9 of the act of June 28, 1940, to modify "existing contracts," or his general authority to modify contracts in the interest of the United States, does not include the authority to modify a contract by inserting provisions which would not be legal and proper as original provisions in a contract.
The Navy appropriations for "Replacement of Naval Vessels" are not available for payment of bonuses, for meritorious services, to contractors' employees engaged on Navy Department shipbuilding contracts, whether payment be directly to the employees or indirectly, through the contractors, under an unenforcible modification of the contracts.
Comptroller General Warren to the Secretary of the Navy, July 22, 1941:
As a result of a comprehensive study made at my request by a group of qualified naval and civilian experts, "a plan to reward outstanding accomplishment and to stimulate the competitive spirit, among shipyards and ship-workers engaged in building naval vessels, in their effort to advance national defense" has been outlined.
I have already appointed a board consisting of Rear Admiral George H. Rock, U. S. N. Retired, Rear Admiral Harry E. Yarnell, U. S. N., and Mr. W. N. Harrison, for the purpose of administering this plan.
Under the right expressly reserved in the Secretary of the Navy, at any time and without notice to the sureties, to make changes in ship contracts, and in pursuance of the authority vested in him by section 9 of Public No. 671 (76th
Congress 3d session) of June 28, 1940, to modify existing contracts as he may deem necessary to expedite naval defense and to otherwise effectuate the purposes of that act, existing contracts for the construction of naval vessels will be modified by addition of the following article:
"Competitive incentive award.-(a) The contractor may, by separate letter of assent addressed to the Secretary of the Navy, agree to be placed on a competitive basis with other contractors building naval vessels, with a view of its employees being paid awards for the meritorious expediting of the shipbuilding program of the Navy Department.
"(b) In the event that the contractor agrees to participate in such competition, a board of awards appointed by the Secretary of the Navy will determine the comparative efficiency of the contractor's plant from time to time and make appropriate recommendations of award to the Secretary of the Navy.
(c) On approval of an award by the Secretary of the Navy, the designated contractor and its employees will be authorized to display certain distinctive insignia and the contractor will receive a cash bonus determined by the Secretary of the Navy, to be used to the exclusive benefit of the employees, as approved by the Secretary of the Navy."
The additional payment to the contractor under the provisions of the article quoted above will be in reimbursement only of actual payments made to the workmen and without profit to the contractor.
Your views as to the availability of funds under the appropriation “Replacement of Naval Vessels" for such purpose are requested prior to putting this plan into effect insofar as concerns private shipyards.
I desire to put this plan into immediate effect in order to derive the maximum benefits from the program, and your early decision in this matter will be appreciated.
The authority vested in you by section 9 of the act of June 28, 1940, Public No. 671, 54 Stat. 680, to modify existing contracts appears to relate to contracts in existence at the time of the approval of said act whereas it is understood from your letter that under the proposed plan other contracts entered into subsequent to June 28, 1940, might be modified. But, however that may be, the authority to modify "existing contracts" as contained in said section 9, or your general authority to modify contracts in the interest of the United States, is not such as to authorize contract modifications by the insertion therein of provisions which would not be legal and proper as original provisions in a contract. In this connection see Preis & Co. v. United States, 58 Ct. Cls. 81, particularly the last paragraph thereof on page 86.
In effect what is proposed here is that the Government pay bonuses to employees of private concerns having shipbuilding contracts with the Navy Department. I find nothing in the acts making appropriations available to you for "Replacement of Naval Vessels" which expressly or by necessary implication, authorizes the awarding of bonuses to such employees for meritorious services. It would seem clear that if such bonuses cannot be paid to private employees directly then they may not be paid indirectly, in the manner proposed, under the guise of an unenforcible contract modifications.
Insofar as the proposed plan contemplates the modification of contracts it would appear that such modification would be of no legal effect because lacking in all the essential elements of a contract. Neither the contractor nor the Government would be bound and neither would have any enforcible rights. Under the plan the
bonuses which would be paid would appear to be payable to such contractors, at such intervals and in such amounts as you might desire, but the modified contracts would not bind you to pay any contractor any amount at any time. Consequently any bonuses paid would be nothing more than gratuities or rewards, for the payment of which the appropriation in question is not available.
If it be considered necessary and in the interests of national defense to adopt such a plan as that proposed then the matter would appear properly for the consideration of the Congress in order that funds be made available therefor. In the meantime this office would inter
pose no objection to proceeding with the plan, if it be understood by all parties involved that the paying of the bonuses as contemplated will be contingent upon obtaining specific statutory authority therefor.
While strict compliance with the advertising for bids requirements of section 3709, Revised Statutes, may occasion certain difficulties under present conditions, such conditions in themselves do not serve to abrogate the statute, or to authorize either the administrative or the accounting officers of the Government to dispense with its requirements in their discretion. Even under present conditions, the Weather Bureau may not enter into several contracts for the supplying of radiosondes by negotiation with bidders who have submitted bids on a competitive advertising-for-bids basis, in the absence of legislative authorization so to contract, notwithstanding that procurement in such manner is administratively desired in order to obviate interruptions, of far-reaching effect, in deliveries which might occur if the procurement were on a competitive advertising-for-bids basis requiring award to only a single contractor-the lowest responsible bidder. Procedure for advertising on a competitive bid basis, so as to obviate the possible objectionable delays, outlined.
Comptroller General Warren to the Secretary of Commerce, July 23, 1941: I have your letter of June 25, 1941, as follows:
During the fiscal year 1942 the Weather Bureau will purchase approximately 30,000 radiosondes at a cost of approximately $600,000. These instruments have been designated as essential to national defense and have been given a priority rating of A-1-d.
Radiosondes are sent aloft twice daily from approximately forty stations in the continental United States, in Alaska, in the Caribbean, and on ships at sea. radiosonde is carried on a balloon to a height of approximately twelve miles at which altitude the balloon bursts and the instrument descends on a parachute. Many are recovered and after reconditioning are again used. During its flight the radiosonde transmits signals which are recorded and from which the pressure, temperature, and humidity are determined.
The essential character of these instruments and the extreme hazard to aircraft operation inherent in interruption of radiosonde upper air soundings makes it highly undesirable that their supply be dependent upon a single source. Procurement by competitive bidding provides only one source of supply and does not assure that such source will be dependable, since award must be made to the lowest bidder who is thought to be responsible, but who may prove otherwise. Even though the manufacturer receiving the award be satisfactory in every way there remain the dangers of fire, strikes, or material shortages which may interrupt production. During the past year a company manufacturing radiosondes (Julien P. Friez and Sons, Division of Bendix Aviation Corporation, in Baltimore) had a
fire in its radiosonde assembly department which interrupted deliveries for about six weeks. Fortunately for the Weather Bureau, Friez was not their source of radiosondes at that time.
In view of the above facts and circumstances it is proposed that radiosondes should be purchased from two or more sources of competition and negotiation. A recent decision of the Attorney General indicates that such negotiation and division of contracts based on joint action with two or more contractors may be permissible in the present emergency. The Attorney General is quoted as stating that "Some of these acts, if accomplished by private contract or arrangement within an industry and carried on for private advantage, would probably constitute violations of the antitrust laws, * * On the other hand, it is obvious that in the present emergency acts performed by industry under the direction of public authority, and designed to promote public interest, and not achieve private ends do not constitute violations of the antitrust laws * *
Because of the hazard to the national defense inherent in the procurement of these instruments from a single source, I deem it my duty to explore every possibility of procedure which will assure two or more sources of supply.
Your opinion as to the propriety of procurement of radiosondes by competition and negotiation is solicited.
The statements of former Attorney General Jackson which are quoted in your letter were contained in his identical letters of April 29, 1941, to the General Counsel, Office of Production Management, and to the Administrator, Office of Price Administration and Civilian Supply. The letters were not official opinions of the Attorney General, but contained outlines of the policy to be followed by the Department of Justice with respect to the adoption within particular industries-at the request of the Office of Production Management or the Office of Price Administration and Civilian Supply-of certain practices which, if adopted by the industries themselves to further private ends, probably would constitute violations of the antitrust laws.
Your letter does not state in what manner it is anticipated that contractors might violate the antitrust laws in the execution or performance of the proposed contracts. However, since this office is not directly concerned with enforcement of the antitrust laws, I assume it is understood that any question arising with regard to such laws primarily would be for consideration by the Department of Justice. I assume, also, that your question as to the propriety of the procurement of radiosondes by "competition and negotiation" results from doubt as to whether the suggested procedure would violate the applicable statutory requirements with respect to advertising for proposals.
Section 3709, Revised Statutes, provides:
All purchases and contracts for supplies or services, in any of the departments of the Government, except for personal services, shall be made by advertising a sufficient time previously for proposals respecting the same, when the public exigencies do not require the immediate delivery of the articles, or performance of the service. When immediate delivery or performance is required by the public exigency, the articles or service required may be procured by open purchase or contract, at the places and in the manner in which such articles are usually bought and sold, or such services engaged, between individuals.
The quoted statute contemplates that all persons, insofar as their individual situations permit, shall be enabled to compete for Govern