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B-185579 1 (1976-01-23)

handle is hein.gao/gaobaddsf0001 and id is 1 raw text is: I.

A


DECISION





FILE:   B-185579


        THE  COMPTROLLER 7VENERAL
. 7   .d% OF THE UNITED STATES
        WASHINGTON, D.C. 20548


(A-0  V


DATE:   January 23, 1976


MATTER OF:      Request for advance decision by
                 the Department of Agriculture

DIGEST:

     Where increased cost of performance of fixed-price
     contract for delivery of nonfat dry milk under
     Department of Agriculture price support program is
     attributable to acts of Government as sovereign in
     raising price support level and no price adjustment
     clause was included in contract, there is no legal
     basis to support upward price adjustment since
     Government as contractor is not liable for its
     acts as sovereign.


     Our views have been requested by the Assistant Secretary,
 Department of Agriculture, as to the propriety of granting to
 A. Sturm and Sons, Inc. (Sturm), an upward price adjustment
 under contract MP(FF)54807 for bulk nonfat dry milk purchased
 by the Commodity Credit Corporation (CCC) of the Department.
 The request by Sturm for the adjustment is attributed to an
 increase by CCC in the price support level and purchase price
 of bulk nonfat dry milk effective January 4, 1975.

     The contract was executed on November 19, 1974, for 1,320,000
 pounds of bulk nonfat dry milk at $0.6598 per pound. The price
 was based on the then current market price for nonfat dry milk,
 $0.5660 per pound, plus packaging and processing allowances.
 The contract schedule required and delivery was made in accordance
 with the following:

      January 1, 1975 -  January 15 -  316,800 pounds


January 16

February 1


-  January 30 -  316,800 pounds

-  February 15 - 316,800 pounds


-  March 15


-  369,600 pounds


     By way of background information, the Assistant Secretary
relates that on August 11, 1972, the CCC issued Announcement
MP-M-45, which listed the terms and conditions under which



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March 1

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