150

mination that 12 were acceptable with the understanding that any progression of the relatively minor scaling would again be cause for their rejection, Exh. 23), the immediate review of rejected flaking or scaling pipe did not take place. The Government asserts, and the contracting officer found, that this review was postponed at Cen-ViRo's request pending demonstration of the Centriline Process for the repair of scaling or flaking pipe.1 Cen-Vi-Ro denies requesting a delay in the Bureau's consideration of rejected pipe and asserts that it had never intended to repair any but a small quantity of the badly flaking pipes by the Centriline Process (pp. 26 and 27, Notice of Appeal). The project engineer testified that the Bureau took a second look at rejected pipes with scaling interiors at the time Cen-Vi-Ro wanted them to look, that is after demonstration of the Centriline Process (Tr. 2068). However, somewhat inconsistently he also stated that the Bureau agreed to review scaling pipes after the deterioration had stopped (Tr. 2010).

We find that the terms flaking or scaling were used by the Bureau to describe two types of pipe interiors: cracking and actual flaking and that the Bureau frequently did

150 The Centriline Process, which involved the removal of weak material by a high velocity jet of water and installation of a thin mortar lining was demonstrated during the week of July 19, 1965 (Tr. 752, 1915; Inspectors Daily Reports, dated July 19, 20, and 22, 1965, Notes on Meeting of July 24, 1965, note 46, supra). The process was considered unacceptable by the Bureau.

not distinguish between the two conditions. We note Mr. Rippon's testimony that the Bureau did not accept flaking pipe because "we wanted to see if we got a progressive failure as it stood out there in the yard" (Tr. 1755). The contracting officer found that interior scaling was a latent defect the evidence of or the ultimate extent of which most frequently could not be determined immediately after manufacture but only after an extended period of storage in the yard (par. 48, Findings of Fact). We also note the statements attributed to Messrs. Crane and Rippon at the July 24, 1965, meeting that the Bureau would reexamine previously rejected pipe with minor scaling and/ or surface cracking. In addition, Mr. Ryland of the Bureau's Denver Office is quoted as stating that Bureau inspectors had been instructed to be conservative in the acceptance of pipe with minor scaling or cracked interiors because of the possibility of the cracking or scaling progressing further and that it was obvious from the present inspection there had been little if any, further development in many of the pipe sections (Notes on Meeting of July 24, 1965, note 46, supra). The resident engineer testified that the instructions to be conservative in the acceptance of pipe with flaky interiors had been given him by the project engineer and that conservative to him meant "not to accept" (Tr. 1956).

The Board finds that the Bureau's concern that the scaling would pro

gress (ie., that cracking would develop into flaking) precluded immediate acceptance of the pipe rejected for cracking or flaking 151 and that the Centriline Process was intended for repair of only those pipes with actual flaking.152 While the Government emphasizes that Cen-Vi-Ro was told on several occasions to locate pipes they considered could be reclaimed and that the Bureau would look at these pipes (Brief, pp. 57, 58) the project engineer testified this did not involve pipes with flaky interiors (Tr. 2018).

We find that approximately 1,579 of the pipes rejected for scaling or flaking during the May 15 inventory had previously been accepted. Although an explanatory note written at the time states that the scaling or flaking had developed since the pipes were accepted, there can be no doubt that the interiors on a majority of these pipes could not properly be regarded as scaling or

151 Mr. Borden's testimony makes it clear that the Bureau had decided prior to the meeting of July 24, 1965, to accept pipes with minor flaking if the flaking did not progress (Tr. 1707, 1708).

152 We think it significant that letters concerning the Centriline Process written by CenVi-Ro to Raymond International, Inc. (letters of June 4 and 25, 1965, Cen-Vi-Ro Correspondence) refer only to pipes rejected for flaky interiors while at approximately the same time Mr. Hubbard is quoted as saying he intended trying to convince the project engineer that pipes with moon shaped cracks were acceptable (Inspectors Daily Report, dated June 24, 1965). Cen-Vi-Ro was clearly aware of the two types of interior pipe conditions. We recognize that the statement to the effect that if Cen-Vi-Ro could sell Centrilining to the Bureau, it stood to recover nearly 1,800 sections of pipe (letter of July 12, 1965, Cen-Vi-Ro Correspondence) is some evidence that the Centriline Process was intended to apply to all pipes rejected for cracking or scaling.

flaking but had minor interior surface cracking and that these pipes were rejected because of the Bureau's concern the cracking would develop into flaking which did not, in fact, occur. The resident engineer testified that some of the pipes rejected during the May 15 inventory were subsequently accepted because the scaling had not progressed to the point it was detrimental to the pipe (Tr. 1916). It is clear that the Bureau reversed its position as to the acceptability of much of this pipe.153 As noted ante, 1,920 of the pipes previously rejected for scaling or flaking (the Summary of Pipe Units Reclaimed, Exh. 146, puts the figure at 1,919) were accepted during the reclaim program. While the project engineer expressed the opinion that the reclaimed pipe did not comply with the specifications (Tr. 2023), and the extent of repairs, if any, to these pipes prior to their acceptance or reacceptance is not clear, we think it significant that 1,013 of the pipes previously rejected for scaling were accepted in September 1965 (Exh. 146). This indicates that it is highly unlikely that any substantial repairs were effected to these pipes.154

153 Notes of Meeting of July 24, 1965, note 46. supra. See also Hubbard letter of August 9, 1965, and Kiesel letter of July 26, 1965 (note 142, supra), the latter of which states that Messrs. Rippon and Ryland of the Bureau's Denver office agreed that "crescent shrinkage cracks" were acceptable as long as there is no flaking.

154 An Inspectors Daily Report dated July 22, 1965, signed by the chief plant inspector, states that Messrs. Crane, Ryland and Rippon examined minor flaking 54-inch pipe (number not stated) and states the writer's conclusion that these pipes would be acceptable without re

interiors of which eleven were considered acceptable with repairs and twenty were considered to be properly rejected. He apparently made no distinction between pipes rejected for scaling or flaking interiors and those rejected for bad interiors since the list of identified pipes he considered acceptable (Exh. 154) includes two pipes rejected for flaky interiors and four rejected for bad interiors. Although it is clear that the Bureau treated bad interiors and scaling or flaking interiors as separate causes for rejection, the record is not clear as to the types of conditions constituting

bad interiors or what were the causes of this defect or defects. In its letter of June 10, 1965 (note 143, supra), Cen-Vi-Ro referred to the repair of localized scaling that occasionally occurs as provided in the contract specifications. The reference is to the Concrete Manual and apparently to the provisions (Section 137. (c), Preparation of Imperfections for Repair) providing for the removal of unsound or imper

fect concrete.

However, we think that this provision is applicable only to the repair of normally repairable defects as listed in the Manual and may not be construed as authorizing the repair of defects not so listed. While Cen-Vi-Ro asserts that most flaking was of a minor nature and easily repairable, it cites no provision of the Concrete Manual authorizing such repairs and it is clear that the primary thrust of this aspect of its claim is that most of the pipes complied with contract requirements

and should have been accepted (Notice of Appeal, pp. 23-27). Accordingly, we conclude that to the extent the Government permitted the repair of pipes with actual flaking, it did so as a matter of grace rather than of contractual right. This holding makes it unnecessary to consider the question of Cen-ViRo's alleged failure to take known corrective action to reduce or eliminate flaking interiors.

Decision

The specifications as we have seen do not prohibit all interior surface crazing but only that deemed excessive. Among the definitions of "craze" is "to shatter" and in the field of pottery "craze" is defined as "minute cracks on the surface of the glaze." 156

Obviously, "excessive crazing" is a matter of judgment. Construing specifications with similar general language we have regarded the conduct of the parties prior to the dispute as of primary that the Bureau did not regard inimportance.157 Here we have found terior surface cracking and even some flaking as a cause for rejection when these conditions were first observed. We have also found that although cracking degenerated into actual flaking on some of the pipes, it was the Bureau's concern that this degeneration might occur on all pipes that led to the rejection of 2,240 pipe units for scaling during the May 15 inventory of which

156 Webster's New International Dictionary, 2nd Edition.

157 Compec. (a Joint Venture), IBCA-573-666 (note 43, supra).