Memorandum of Disapproval of Bill for the Relief of the E. J. Albrecht Company.

I HAVE WITHHELD my approval from the bill (H.R. 1393) "For the relief of the E. J. Albrecht Company."

The bill directs the Secretary of the Treasury to pay $142,007.75 to the E. J. Albrecht Company as reimbursement for actual losses sustained by it in performing its contract with the United States for the construction of the outlet works for Sardis Dam on the Little Tallahatchie River, near Sardis, Mississippi.

After an exhaustive review, the Court of Claims dismissed this claim as being without merit. While this decision was based on legal grounds, the opinion issued by the Court in connection with its decision shows, particularly when taken in conjunction with the rest of the record, that there is no basis for affording relief to the contractor on equitable grounds. From these sources it is clear that the overriding causes of the losses which the contractor sustained were its own acts or omissions and the weather conditions it encountered in the performance of the work. I see nothing in these circumstances giving rise to equitable liability on the part of the government.

The continued success of the policy of awarding public contracts by competitive bids depends, of course, on the knowledge that successful bidders will be held to their bids with the same strictness as if they were dealing with private contractors. Relieving bidders of losses occasioned by the submission of bids that were successfully low because of over-optimism or failure to account for risks would not only strike a serious blow at the integrity of the competitive bidding system but would be unfair to more provident bidders who might otherwise have received the awards. It would deprive the government of benefits resulting from favorable circumstances occurring during the performance of a contract while requiring compensation for losses encountered as a result of unfavorable circumstances.

There are no circumstances in this case that would serve to distinguish it from others wherein contractors with the United States have suffered losses for which the government was not responsible. In view of this fact and in the absence of any equitable considerations in favor of the contractor, I perceive no merit in the claim for special treatment in this case.

Accordingly, I am constrained to withhold my approval from the bill.

DWIGHT D. EISENHOWER