Specification of taxes included or excluded; information to bidders. 803.360 Periodic adjustment of price and exemption from renegotiation. 803.360a Price adjustment article based on optional periodic adjustment of price; where contractor has had previous experience in production of item. 803.360b Retroactive changes in wages, salaries, or other terms or conditions of employment. 803.361 803.362 803.363 Short term pricing. Accident prevention. Disposition of Government-owned property by contractors. 803.364 Marking of shipping containers. 803.365 Contract clauses in connection with bonds and insurance. 803.366 Offers of prompt payment of cash discounts. 803.367 Subcontracting clause; fixed price supply contracts. 803.368 Subcontracting; cost-plus-a-fixed fee supply contracts. 803.369 Release upon final payment under cost-plus-a-fixed-fee contracts. Subpart I-Termination of Fixed Price (Lump Sum) Contracts Upon Default of Contractor 803.379 Steps to be taken in event of default. 803.380 Steps to be taken in event of termination because of default. 803.380a Procedure to be followed when remedies under delays-damages article are pursued. 803.390 Subpart L-Miscellaneous 803.391 Charges for telegraph, cable, and radio messages in cost-plus-afixed-fee contracts. 803.392 Handling defaults and threatened defaults by suppliers and subcontractors under cost-plus-afixed-fee prime contracts. 203.393 Disclosure of information in connection with completing Selective Service affidavit. 803.394 Contracts for electric power. 803.395 Contracts within section 9, Military Appropriation Act, 1944 and 1945. 803.396 Prior approval of awards of "management consultant" contracts. AUTHORITY: §§ 803.301 to 803.396, inclusive, issued under 41 Stat. 164, 54 Stat. 1225, 10 U.S.C. 1193-1195; 55 Stat. 838, 50 U.S.C. App., Sup., 601-622. SOURCE: §§ 803.301 to 803.396, inclusive, contained in War Department Procurement Regulation 3, revised to June 29, 1944, 9 F.R. 8390. Exceptions are noted in brackets following sections affected. Subpart A-General § 803.301 Rescission of regulations. Army Regulations 5-200, dated January 2, 1940, as amended, and all other prior directives and instructions of whatsoever nature relating to the making of contracts are hereby rescinded. (a) Compliance with this part. Unless otherwise specifically provided, compliance with any provision of this part or of any amendment thereto which requires a change in contract procedure or in any contract provision shall not be mandatory until thirty days after the issuance of such regulation or amendment. § 803.302 Definitions. As used in this part the following terms will have the meanings assigned to them in the following paragraphs: (a) United States and Government. These terms are synonymous and include the War Department. (b) Contractor. A contractor is any person, partnership, company, or corporation (or any combination of these) which is a party to a contract with the United States. (c) Contracting officer. (1) A contracting officer is an officer or civilian official of the War Department who has been appointed by any one of the following persons, or by their direction, or in accordance with such orders and regulations as they may prescribe for their respective commands, to execute contracts on behalf of the United States: (i) The Secretary of War; (ii) The Under Secretary of War; (iii) The Commanding General in a Theatre of Operations; (iv) The Commanding General, Army Air Forces; (v) The Director, Purchases Division, Army Service Forces; (vi) The Chief of any Technical Service. (2) Unless otherwise specifically provided, the words "the contracting officer," when used in this chapter or in any existing or future contract, supplemental agreement or change order, are construed to include: (i) His duly appointed successor or authorized representative; (ii) Any and all contracting officers, acting within the scope of the orders respectively appointing them contracting officers. (3) Representatives may be designated as follows: (i) The Chief of a Technical Service may designate any officer or civilian official to act as representative of the contracting officer or his duly appointed successor; (ii) A commanding officer may designate any contracting officer assigned to his command or station to act as representative of any other contracting officer assigned to the same command or station, or of a contracting officer's duly appointed successor so assigned; (iii) A contracting officer, his duly appointed successor, and any representative designated pursuant to (i) or (ii) of this subparagraph (3), may respectively designate any officers or civilian officials to act as their representatives. (4) A designation authorized by subparagraph (3) may be made by instructions referring to particular contractual instruments or classes of instruments, and may, to the extent not specifically prohibited by the terms of the contractual instrument involved, empower the representative to take any or all action thereunder which could lawfully be taken by the contracting officer. In no event, however, shall a representative, by virtue only of his designation as such, be empowered to execute any contract or supplemental agreement (as distinguished from change order). Of course, if the representative is a contracting officer, he may, pursuant to the order appointing him a contracting officer, execute contracts or supplemental agreements. (5) Any person duly appointed a contracting officer in accordance with subparagraph (1) above, with authority to execute contracts on behalf of a particular technical service, service command or the Army Air Forces may execute contracts on behalf of any other service when the necessary funds, if any, have been made available. (6) All action heretofore taken which would have been valid if this paragraph had then been in effect, is hereby ratified and confirmed. (c-1) Appointment of contracting officers at installations such as ports of embarkation. The question sometimes arises whether a contracting officer carrying on procurement activities at an installation such as a port of embarkation should be appointed by the chief of the technical service having jurisdiction of the installation, or by the chief of another technical service which may have an interest in the particular type of procurement. The following rule of administration is established: The chief of the technical service (including the Commanding General, Army Air Forces) having jurisdiction of an installation is charged with primary responsibility for appointing contracting officers to carry on procurement activities at the installation, but with the concurrence of the chief of that technical service, the chiefs of other technical services (including the Commanding General, Army Air Forces) interested in the various types of procurement may appoint such contracting officers. This does not alter in any way the authority of the persons designated in paragraph (c) (1) (i), (ii), (iii) and (v) to appoint contracting officers. (See also § 813.318b (a).) (d) Disbursing officer. A disbursing officer is the officer who has been designated to make payments under a contract. (e) The following are terms used in connection with contracts: (1) Signed number. A signed number means the instrument with the required signatures, (2) Authenticated copy. An authenticated copy means a copy of the instrument shown to be authentic by either: (i) Certification as a true copy, (ii) Official seal, or (iii) Photostatic process. The signatures on such copies may be either facsimile, stamped, or typed. (3) Copy. A copy means a copy of the instrument, including the names of the contracting parties, but lacking authentication. (f) Default. Default is the refusal or the failure of a contractor to carry out the terms of a contract. [Proc. Reg. 3, revised to June 29, 1944, 9 F.R. 8390, as amended by C 43, Nov. 23, 1944, 9 F.R. 14160] § 803.303 General requirements for contracts. (1) Every purchase transaction except those where payment is made coincidentally with receipt of supplies will be evidenced by a written contract. (2) Where it has been administratively determined by the commanding officer as more economical and advantageous in the interest of the war effort, Class B agent officers may be appointed in pro curement installations under the provivisions of AR 35-320 for the purpose of making cash payments for emergency purchases and nonpersonal services not exceeding $100. The use of War Department Form No. 332 (Public VoucherEmergency Purchases and Nonpersonal Services Not Exceeding $100), properly executed and supported by certified invoices, will be used for this purpose. War Department Form No. 332 may be closed periodically to suit local conditions and submitted to the disbursing officer for credit in the agent officers' accounts as prescribed by AR 35-320. (3) War Department Form No. 332, when used as authorized in subparagraph (2) above, will be prepared in quadruplicate (original and three memorandum copies) and distributed as follows: (i) Original and duplicate to accountable disbursing officer, supported by certified invoices. (ii) Triplicate to accountable property officer, supported by certified invoices and the following certificate: I certify that the supplies enumerated hereon were received by me and that payment therefor has been made by me as agent officer in cash this day of 19, from funds intrusted to me by.. finance officer at -9 (Name, grade, and organization) (iii) Quadruplicate, without attachments, to Fiscal Officer, Service Command Headquarters, for property audit files. This copy will be stamped with stamp of agent officer to indicate payment in cash or by check. (4) When funds are expended in accordance with the procedure outlined in subparagraphs (2) and (3) above, the transaction need not be evidenced by any written contract or purchase order, since payment will be made coincidentally with receipt of supplies. (a) Contracts may be either formal or informal. (b) A formal contract is one which is contained in one instrument executed by both parties. An illustration is War Department Contract Form No. 1 (see § 813.1301). Formal contracts may be used for any purchase transaction, regardless of amount and will be used for all purchase transactions, the contract price of which exceeds $500,000. (c) For any purchase transaction, the contract price of which does not exceed $500,000, an informal contract consisting of two separate instruments, one signed by the contractor and the other signed by the contracting officer on behalf of the United States, may be used. (d) (1) When a purchase order is preceded by a written quotation or is followed by a written evidence of acceptance executed by the contractor, it is to be regarded as an informal contract consisting of two instruments; and accordingly, may be used, in accordance with paragraph (c) of this section, for any purchase transaction the contract price of which does not exceed $500,000. If the contractor's assent is not evidenced either by a written quotation or by acceptance of the purchase order in writing, the purchase order may nevertheless be used for any purchase transaction the contract price of which does not exceed $500,000 provided that the purchase order is preceded by an oral quotation or is based upon a price list. (2) When the contractor furnishes no evidence of his assent either (i) by a written or oral quotation, (ii) by a written acceptance or (iii) by the publication of a price list, the purchase order may not be used for any transaction the contract price of which exceeds $5,000; but may be used for any transaction the contract price of which does not exceed $5,000. (3) The provisions of this paragraph and of paragraphs (b) and (c) are not applicable to interbranch or interdepartmental purchases (see § 806.605a and Subpart C of Part 806). Regardless of the amount involved, such purchases need not be evidenced by formal contracts. They should be evidenced by a delivery order (for suggested form see § 813.1317, Form No. 19). (e) Numbering and distribution of contracts. (1) The numbering of contracts is discussed in §§ 803.309 and 803.318b (e) and the distribution of contracts is discussed in Subpart D of this part. (2) Distribution of purchase orders. As pointed out in subparagraph (2) of paragraph (d), it is not necessary that a purchase order which does not exceed $5,000 in amount be preceded by a quotation. If the contract price exceeds $5,000, however, the following rules shall apply: (i) If the purchase order was preceded by a written quotation signed by the contractor, or if the contractor delivered some written instrument evidencing the contractor's assent, the original of such written quotation or instrument should be forwarded to the appropriate Army Audit Branch of the General Accounting Office and a copy thereof attached to the copy of the purchase order furnished the disbursing officer. (ii) If the contractor did not furnish a written quotation or written evidence of its assent and the purchase order merely accepted an oral quotation or was based on a price list, the purchase order, as forwarded to the Army Audit Branch of the General Accounting Office, should contain a reference to the oral quotation or price list. This may consist of a simple statement such as "Pursuant to oral quotation of even date" or "Pursuant to oral quotation of 194__" or "Pursuant to identification) 194__". (Name of contractor or other price list, dated (f) Partial payments. It is to be noted that any type of contract, including the purchase order, may provide for partial payments upon completion of the delivery of one or more complete units called for under the contract, or upon the completion of one or more distinct items of service called for thereunder. Any existing contracts which provide for a single payment may be amended to provide for such partial payments. Likewise, prior to delivery, payments may be made on work in progress for the Government, Provided, That the contract contains a clause similar to one of the contract clauses set forth in §§ 803.330 and 803.331. Contracts (including purchase orders) under which it is contemplated that more than one payment will be involved must, of course, be numbered as required by § 803.309 (a) and distributed in accordance with § 803.316. § 803.303a Letters of intent and letter orders. (1) Use. The use of letters of intent and letter orders (see §§ 842.212 2 and 842.213-3) was frequently necessary in the earlier stages of the war procurement program to enable contractors to start work immediately upon war contracts prior to the time when the information was available upon which a definitive contract could be negotiated and without the delay incident to contract negotiations. At the present stage of the procurement program, such temporary contractual instruments will be used only for the most cogent reasons and will be superseded at the earliest possible moment by definitive contracts. In general, such instruments should be used only (1) where it is essential to give the contractor a binding commitment to permit of preparatory work immediately and without any delay, or (2) where because of the experimental nature of the work involved or the lack of definitive information as to the volume of supplies to be ordered, the amount of work to be done, or detailed specifications, it is impossible to negotiate a definitive contract. Such instruments should not be used as a method of delaying the making of a definitive contract until a substantial portion of the contractor's performance of the contract has been completed. The standard termination provisions for inclusion in letter orders and letters of intent (see §§ 842.212-2 and 842.213-3) leave room for the insertion of a date by which the definitive contract is to be executed, and also permit postponement of such date by mutual consent (see paragraph 6 (a) of contracts in §§ 813.1307 to 813.1310, inclusive). The date inserted should be the earliest date feasible under the circumstances, and postponement should not be consented to except for good cause. (2) Report on letters of intent, etc. (i) on or before the 10th of each month the chief of each technical service will file with the Director, Purchases Division, Headquarters, Army Service Forces, a report entitled "Age Analysis of Outstanding Letters of Intent, Etc." (Control Approval Symbol PDS-17) and described in subdivision (ii) below. The first report shall be due September 10, 1944, for the period ending August 31, 1944. This report does not conflict with the reports of negotiated purchase actions in excess of $10,000, (Control Approval Symbol ICY-33) required by § 802.293. (ii) The reports "Age Analysis of Outstanding Letters of Intent, Etc." (Control Approval Symbol PDS-17) will be |