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<![CDATA[
CCASE:
LAWRENCE J. COOK
DDATE:
19831107
TTEXT:
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[1] SECRETARY OF LABOR
WASHINGTON, D.C.
LAWRENCE J. COOK, JR.
individually, and doing
business as COOK BUILDING Case No. SCA-1046
AND MAINTENANCE SERVICE
Respondents
DECISION OF THE SECRETARY
The above captioned matter is before me for review of a
petition for relief filed by Respondent, initially, in August of
1982. Respondent Lawrence J. Cook, Jr., individually and doing
business as Cook Building Maintenance Service, was charged in a
complaint filed on January 10, 1979, with violations of the
McNamara-O'Hara Service Contract Act of 1965, as amended (79
Stat. 1034; 41 U.S.C. [sec] 351, et seq.) hereinafter referred to
as the "Act", and the Regulations issued thereunder (29 CFR Parts
4 and 6). The violations were alleged to have occurred during
the performance of two (2) Government contracts (Nos. N62474-77-
C-4489 and N62474-B-8650) which were subject to the provisions of
the Act and Regulations. Specifically, Respondent was charged
with the failure to pay certain employees employed in the
performance of the above-cited contracts the minimum monetary
wages and fringe benefits required by such contracts, by Sections
2(a)(1) and (2) of the Act [41 U.S.C. [secs] 351(a)(1) and (2)]
and by Section 4.6 of the Regulations [29 CFR [sec] 4.6].
Following a hearing on the matter, conducted on June 6,
1979, by Administrative Law Judge Steven E. Halpern (hereinafter
referred to as the "ALJ"), a decision was issued on September 14,
1979. ALJ [1]
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[2] Halpern found, inter alia, that violation of the Act and the
Regulations had occurred; that monetary restitution for the amounts
claimed by the Government had been made by Respondents, and that the
violations were not "caused by a deliberate disregard of his
obligations" on the part of the Respondent. Because of the latter
finding, the ALJ recommended that the Secretary of Labor relieve
Respondent from the imposition of the Act's ineligibility sanction (41
U.S.C. [sec] 354(a)).
Following an appeal by the Government of the ALJ's decision,
an appeal limited to the sole issue of whether or not the ALJ's
recommendation with regard to the non-imposition of the
ineligibility sanction should be allowed to stand, the Department
of Labor Wage and Hour Administrator issued his decision on the
matter on September 14, 1981. In his decision, the Wage and Hour
Administrator reversed the recommendation of the ALJ, holding
that Respondent's experience as a Government contractor and his
history of prior violations placed upon him a greater then
ordinary burden to adhere to the terms of the Act. James A.
Carte d/b/a James A. Carte Trucking Co., Case No. SCA-1017,
October 3, 1979; Washington Moving and Storage Co., Case No. SCA-
168, decision of the Assistant Secretary, 1973, affirmed by the
Secretary, 1974. As a result of Respondent's failure to satisfy
this burden, the Administrator failed to find the requisite
"unusual circumstances" necessary under the Washington Moving and
Storage decision, supra, to warrant relieving Respondent from the
ineligibility list sanction provided for in Section 5(a) of the
Act. He, therefore, recommended to the Secretary that no such
relief be granted. As a result of the foregoing, on April 2,
1982, I sent to the Comptroller General of the United States, the
names of Respondent and his firm [2]
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[3] for inclusion on the debarred bidders' list as provided for by the
Act. The names have appeared on the list since April 15, 1982, and
under normal circumstances, would remain there for the full three year
period prescribed by law.
This matter has, however, since the imposition of the
ineligibility sanction, engendered new factual circumstances
which I find warrant a fresh review of the merits of the
debarment action. In January, 1981, Lawrence Cook, Jr. died.
Since February 5, 1981, by Order of the Superior Court of the
State of California, the estate of the late Mr. Cook, including
the firm of Cook Building Maintenance Service, has been
administered by court appointed executors. Following the action
by the California Court, in separate letters of August and
October, 1992, attorneys for Respondent have sought "review" of
the matter of debarment -- asserting generally, the inequity of
debarring a dead man's firm and, specifically, the detrimental
impact of the debarment on the firm of Cook Building Maintenance
Service in that the firm was still being asked to bid on
government projects which, because of the ineligibility sanction,
it could never be awarded. Adding further to the extraordinary
circumstances in this case, attorneys for the Labor Department,
by Statement dated July 12, 1982, have taken the unusual posture
of support for Respondent's position by indicating that the
Department does not oppose the Respondent's request for removal
from the debarred bidders' list.
The equities in this matter are in favor of the Respondent's
request for removal. Nevertheless, despite the apparent
agreement of both parties that the debarment term should be
suspended, there remains a crucial question of my authority to
grant that particular [3]
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[4] relief, both the Act and the existing Regulations being silent on
the matter. As a result, and because of the failure of either party to
cite support for the proposition that the Secretary of Labor can remove
those that have already been debarred, I asked for additional briefing
on that issue by Order dated January 26, 1983. In their response to my
Order, both parties have taken a creative look at the question of the
Secretary's authority. The Government cites the proposed new Service
Contract Act Regulations,/FN1/ admittedly not yet in force and affect,
as support for the proposition that the situation here can be analogized
to a mistake or legal error, a position grounded on the contention that
Cook Building Maintenance Service was, "as a matter of law" only the
assumed or fictitious name under which the late Mr. Cook was operating
and, therefore, as a fictitious legal entity, the firm was not and could
not itself be a party responsible for the violations of the Act.
The Government goes further and cites a series of cases
which, it contends, stand for the proposition that the debarment
sanction is a means of effectuating future compliance and
deterring future violations./FN2/ Obviously, Mr. Cook's death
precludes any future noncompliance on his part. Hence, these
cases lend support to lifting the instant debarment. [4]
ÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄ
/FN1/ Federal Register, August 14, 1981 (Vol. 46, No. 157, p.
41424).
/FN2/ Aarid Van Lines, Case No. SCA 423-425, May 13, 1977; Copper
Plumbing and Heating v. Campbell, 290 F.2d 368 (D.C. Cir. 1961);
Gonzalez v. Freeman, 334 F.2d 570. 576-577 (D.C. Cir. 1964);
L.P. Stewart & Bro., Inc. v. Bowles, 322 U.S. (1944); and
Greenwood's Transfer & Storage, Inc., Case No. SCA-321-326,
September 13, 1975, 22 WH Cases 716. [4]
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[5] The Respondent in his reply to my earlier Order cited
authority in both the statutory and regulatory provisions as well
as case law under analogous, "sister" labor standards acts for
the proposition that the Labor Secretary has the power to remove
debarred bidders and firms. Particularly with regard to the
statutory citations, Respondent argues with some persuasiveness
that Sections 37 of the General Provisions of the Public
Contracts Title (41 U.S.C. [sec] 37) and 354(a) of the Service
Contract Act empower the Labor Secretary with the authority to
[*]recommend[*] (to the Comptroller General) that the debarment
sanction issue and that persons or firms not be subjected to the
debarment sanction upon a finding of "unusual circumstances".
While the citations to these provisions are instructive, the
issue of the timing of such recommendations is raised by both in
that, on their face, they appear to relate to the post-
hearing/administrative phase, before the process has taken on the
characteristic finality of the sanction itself.
In attempting to apply the relevant statutory and regulatory
law to the facts to this matter, I must weigh the distinctive and
salient principles whereby:
A) My power as a federal deciding official must appear
affirmatively from the Act which compels and authorizes me to act
(noting, particularly, that such officials, in the exercise of
their power, must stay within the scope of the powers granted
them) and
B) Administrative officials are, generally, vested with
discretion in the exercise of their powers and the performance of
their duties. [5]
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[6] In the matter before me, it is clear that the former
principle should prevail. The authority granted the Secretary of
Labor by the Act and the Regulations is clearly the authority to
recommend. No where in any of the materials cited by either
party is there expressly granted to me the unbridled discretion
of power to remove those who have been debarred under the Act.
Significantly, the only cited authority where I (or, more
specifically, my delegate, the Wage and Hour Administrator) am
granted such express power to remove is located in the
Department's regulations at 29 CFR [sec] 5.6(b)(1) which pertain,
not to the type of service contracts at issue here, but to
federally financed or assisted construction contracts. For
whatever reasons, the Regulations applicable to the Service
Contract Act do not contain a parallel grant of authority.
Likewise, the case cited by Respondent also arise under
different wage and hour statutes. While both the protection
afforded and the procedures available under these separate and
distinct statutes are very similar to those afforded under the
Service Contract Act, they are not the same and, as stated above,
I am bound by the limits of the authority expressly granted me.
An the Government aptly acknowledge, however, the matter
here is as much equitable as legal and I find that there is room
for a reasonable exercise of discretion which is, at the same
time, consistent with my express authority under the Act to make
recommendations on the imposition (or non-imposition in the case
of "unusual circumstances" which exist at the time of the
decision) of the debarment sanction. This is especially so in
this matter where it appears that Respondent Cook had died,
without that fact brought to the attention [6]
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[7] of the appropriate Labor Department authorities, prior to
the actualaffective date of debarment.
As such, I believe that this contains a sufficient amount
of the various elements cited by both parties -- i.e., legal
error, fictitious or nonexisting parties and, indeed, unusual
circumstances that I hereby recommend to the Comptroller General
that the firm be removed from the list of those who are currently
ineligible to receive Government contracts. While I believe that
this is both a sane an legally sound position and a proper
exercise of my discretion under the Act, I must point to the fact
that the actual decision to remove is to be made by the
Comptroller General upon receipt of this recommendation.
[Raymond J. Donovan]
Secretary of Labor
Dated: November 7, 1983
Washington, D.C. [7]
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