U.S. Government Printing Office Office of the General Counsel Contract Appeals Board Appeal of Sacramento Blue Print, Incorporated CA-76-5 March 28, 1977 Vincent T. McCarthy, Chairman Drew Spalding, Member Jay E. Eisen, Member This is an appeal filed on May 12, 1976, by Sacramento Blue Print, Incorporated, 1720-15th Street, Sacramento, California 95814 (herein referred to as the contractor), under the disputes clause of the Contract, Article 29, U.S. Government Printing Office, Contract Terms No. 1, as revised July 15, 1970. The Office of General Counsel is the Public Printer's representative for the determination of appeals under the disputes clause. Issue This is an appeal to a decision by the contracting officer denying payment of a portion of the invoice submitted by the contractor. The issue is whether the contract terms permit payment to the contractor for three cover leaves per book produced, rather than two leaves per book as allowed by the Contracting Officer. Findings of Fact 1. This dispute arises out of Term Contract, Program 1952-M, for Federal Printing Region No. 9-11 (Northern California and Northern Nevada) in effect during September 1, 1975 through August 31, 1976, which required the printing and binding of books and pamphlets in quantities to cover the needs of the Government. By the terms of the Specifications, the provisions of U.S. Government Printing Office, Contract Terms No. 1 (revised July 15, 1970) were incorporated as part of the agreement. The Purchase Order at issue is number P-0765 and the Print Orders are numbers 217, 218, 219, 220 and 5613. 2. The contract's "Schedule of Prices" covering charges for Printing and Binding reads in relevant part: "I. PRINTING AND BINDING: The prices quoted shall include the cost of all materials and services (other than negatives and paper) necessary for printing text and cover pages in black ink, or a single color other than black, and with additional colors, and printing fold-ins in black ink, and with additional colors, and binding as indicated. . . . . "Penalty Pages: All cover pages shall be computed as 2 pages. . . . . "Price per page - 2 pages equal 1 leaf 1. Text or cover - single page over 7 7/8 x 10 1/4 to 8 1/2 x 11"." (p. 23) (Emphasis added.) 3. Part IV of the Schedule of Prices covers reimbursement for paper used by the contractor in producing the items ordered, and reads in part as follows: "IV. PAPER (to be furnished by the contractor): The contractor will be reimbursed for the net number of page-sized leaves of stock required for each print order. Cost of any stock required for makeready or spoilage must be included in the prices quoted". . . . . (p. 29 - 30) 4. The section covering "Presswork" reads in pertinent part: "Covers, when required, will print one or more pages plus backstrip, if required, . . . ." (p. 13) 5. The contractor performed the printing, binding, and delivery as required by the Print Orders and submitted invoices for the work performed. These invoices included charges for three cover leaves for each book. 6. By letter of April 14, 1976, the Contracting Officer informed the contractor of his final decision not to permit payment for more than two cover leaves per book. In his letter he reasoned: "There is no provision in the contract that authorizes payment for fractional parts of a cover; i.e. spines cannot be considered as cover units." 7. In a reply dated May 12, 1976, the contractor appealed the Contracting Officer's decision and made certain statements which are undisputed, important among which are: a. The contract year was approximately at mid-point before GPO reduced the number of cover leaves per book for which GPO would pay. b. The contractor had bid on this contract with a history of billing and being paid for 3 cover units by GPO. Discussion The gravamen of the contractor's argument is that the spine or backstrip of a perfect bound book should be considered as a third cover leaf for which the contractor is permitted to bill pursuant to the contract terms. In coming to this conclusion the contractor references various sections of the contract which are set out above in our Findings of Fact, with the exception of the contract provisions relative to "Perfect Bindings" (Specifications, p. 14) and to payment for "Fold-ins" (Specifications, p. 24). With regard to fold-ins, the contractor argues that because a whole additional unit payment is permitted for a fraction of a fold-in (above a designated number of square inches) so, in turn should a fraction of a cover be considered and billed as an additional unit. The logic of this is questionable. Covers and fold-ins are distinct items and are separately priced in the contract. The section entitled "Perfect Bindings" which is also omitted from the above Findings of Fact, merely details the requirements which must be met in terms of strength, flexibility and elasticity. It does not pertain to payments for cover units. In short, these sections are neither material nor relevant to the instant case. Covers are discussed in the "Presswork" section of the contract in the following terms: "Covers, when required will print one or more sides plus backstrip, if required. . . ." (Emphasis added) (p. 13) From this it is evident that the backstrip is considered an integral part of the covers. The price for each cover is established by the contractor's bid and is set-out in the "Schedule of Prices". (Reference: Finding of Fact Number 2 above). It is noted that the prices the contractor submitted were for text or cover pages with dimensions of over 7 7/8" x 10 1/4" up to 8 1/2" x 11". The backstrips of the perfect bound books in this case do not even remotely conform to these dimensions, and hence cannot be deemed to be a separate cover unit. It is true that the precise amount of printing required for the backstrip is not ascertainable prior to receipt of the individual print order (which specifies the number of pages to be in each book). However, this is a cost which can be estimated, based on averages and prior experience, and can be included in the contractor's bid. The contractor always had the option of not bidding on the contract if it felt the cost variance would be too great under this type of pricing schedule. Having considered the relevant contract language concerning the proper payment for covers, we turn to the issue of estoppel which implicitly is raised in the contractor's letter of appeal dated May 12, 1976, which reads in part: ". . . We have been billing GPO in the same manner since 1971, as well as for the first half of this contract. "In determining our prices for this contract, we have made no allowances for any costs to cover this decision in your [GPO Contracting Officer's] letter. . . ." In this regard, the contract specifies: "Payment will be made on the basis of the actual number of units of each operation as described in the specifications and at the prices quoted therefor." (p. 5) It is clear from our reading of the above referenced pricing provisions that payment should have been certified for only two covers during the period mentioned by the contractor, assuming the determinative contract language was the same. The issue is, therefore, does estoppel lie against the Government Printing Office because the contractor has been billing and the Government Printing Office has been paying for three cover units instead of two, as permitted under the contract terms? As a general matter, the government is not estopped by the acts of its agents. See Utah Power and Light Company v. United States, 243 U.S. 389 (1917); United States v. Fallbrook Public Utility District, 165 F.Supp. 806 (1958); United States v. Ulvedal, C.A.N.D., 1967, 372 F.2d 31; Comp. Gen. Dec. B-168619, January 14, 1970, (Jarrett Press, Inc.). The narrow exceptions which exist to this general rule are not pertinent to this case. From this we conclude, that the history of overcharges which were erroneously certified and paid by the Government Printing Office does not serve as a justification for continuing to permit this practice. It was and is, therefore, proper and lawful for the Contracting Officer to disallow payment for the third cover unit as billed by the contractor. In view of the above, this appeal is denied.