A typical set of regulations and forms for such bureau settlements is to be found in Ordnance Claims Board Circular 74 of 1919. Some of the bureaus established especial boards to operate on claims on certain groups of contracts, as, for example, the Nitrates Board of the Ordnance Department. These functioned as district boards. The bureaus with more limited numbers of contracts do not generally operate through district organizations. The bureau board itself in such cases conducts the whole investigation and negotiation and makes the award and settlement contract subject to the approval of or, if a statutory award, execution by the War Department Claims Board member assigned to that bureau. Where for any reason an agreement can not be reached by the district within the limits of the regulations the case goes first on appeal to the bureau board and, if no agreement is reached there, then on further appeal to the Board of Contract Adjustment of the War Department. The boards which were charged with the duty of determining what curtailment of production was desirable and in negotiating contracts for such curtailment came generally to be known as claims boards. One such board was set up in each bureau. The Ordnance Department Claims Board was established as early as November 6, 1918. In certain of the bureaus, as in the office of the Director of Purchase, and in ordnance, it was necessary to decentralize their activities; and in these bureaus, the bureau claims board became a reviewing board, while the actual negotiations for the new contracts were carried on in the case of ordnance by claims boards established on November 26, 1918, in each of the ordnance districts into which the country was divided; and in the case of purchase, by claims boards in each of the supply zones into which the country was divided. Of these district boards, the district chief or zone-supply officer was made chairman; a prominent business man of the district was generally made a member of the board, and to it was attached a lawyer. The existing personnel in the district or zone was coordinated to assist in the work. This personnel had been engaged during the war in activities of inspection, accounting, finance, expediting production, etc., and contained the best available material to check and examine the statements submitted by the contractors on prescribed forms as to the expenditures and commitments which they had made in preparation for the curtailed portion of the contract and the other elements which they claimed ought to be taken into consideration in the negotiation of the new contract with them providing for the curtailment of their production. This personnel was formed into groups under the leadership of officers or civilians designated by the chairman of the board, and these heads, with their principal assistants, were usually known as the staff. The district or zone board, or the bureau claims board in those bureaus where there are no local boards, makes a complete determination as to the facts stated by the contractor and embodies its findings in a condensed statement, generally on a prescribed form, known as an award. This award, when assented to by the contractor, becomes the basis for the settlement or supplemental contract; or, where the contract is not executed in the manner prescribed by law, for the statutory award under the act of March 2, 1919. Reference has been made above to the War Department Claims Board. This board acts under the presidency of the Assistant Secretary of War, who, as Director of Munitions, has supervision and direction of the whole supply system of the Army, and consequently of all contracts and questions relating thereto. This board was given, by Circular No. 26 of the War Department, dated January 20, 1919, power "to supervise and coordinate the work of the various. War Department agencies engaged in the settlement of claims resulting from the termination of contracts or other procurement obligations of the department consequent upon the suspension of hostilities and to authorize and approve such settlements." This circular seems to confine the jurisdiction of this board to claims on contracts already terminated; but this obviously was not the intent, for the Secretary of War would not then have jurisdiction. It is construed to extend to all matters of adjustment on War Department contracts. All settlement contracts negotiated by the bureaus, before they can become effective, must be approved by this board or one of its members designated for the purpose. Upon the passage of the Dent Act, the powers of the Secretary of War to adjust, pay, and discharge the agreements covered by that act, so far as they related to contracts made in the United States and Canada, were delegated to the War Department Claims Board by General Order No. 40, of March 19, 1919, and all statutory awards made under this act are made in its name by the board or by one of its members authorized for that purpose. The actual consideration of settlement contracts and the making of statutory awards are, except in special cases, carried on by specially designated members of the board, who sit with the bureau claims boards, the War Department Claims Board as a whole confining itself ordinarily to the determination of questions of policy and the supervision of the administration of various agencies of the department engaged in contract settlement work. In administering its powers under the Dent Act the War Department Claims Board makes use of the bureau and local boards in the negotiation of proposed statutory awards and has also delegated important parts of its jurisdiction to the Board of Contract Adjustment. The Board of Contract Adjustment was organized on November 6, 1918, in order to meet requirements for a board that would perform the functions provided for in the standard form of contract required by Supply Circular 88. 1918, and to determine questions of doubt and other incidental questions arising during the performance of contracts. It was intended that this board should relieve the Secretary of War from the determination of many perplexing questions which would otherwise be submitted to him. It was planned to have it composed of men drawn from civil life, of high standing in their communities, and whose views would command the confidence of contractors and make them feel that their rights under their contracts were being considered in a broad and business-like fashion by men who had been accustomed to deal with similar important questions in civil life. If When the work of negotiating settlement contracts was imposed upon the department it was immediately felt that the Board of Contract Adjustment would be a useful agency in passing upon the terms of proposed supplemental contracts where the negotiating bureaus and the contractor could not come to an agreement as to the terms of the new contract. Consequently, it was provided that, where the bureau board and the contractor are unable to come to an agreement, the contractor may appeal to the Board of Contract Adjustment for a review of the proposed terms of the settlement contract. (Supply Circular No. 111, dated Nov. 9, 1918.) the Board of Contract Adjustment is in agreement with the views of the bureau board, and its position is sustained by the Secretary of War on a submission to him for review, then, unless the contractor is willing to make an adjustment upon that basis, the original contract is terminated and adjusted under its cancellation clause, or if there be none, then it is breached and the contractor relegated to his rights in the courts. In the event that the Board of Contract Adjustment finds that a supplemental contract ought to be made on terms other than those proposed by the bureau board and objected to by the contractor, the matter is sent back to the bureau board for the making of a supplemental contract along the lines outlined by the Board of Contract Adjustment. A similar appellate jurisdiction from the action of. the bureau boards with reference to Dent law awards was delegated to the Board of Contract Adjustment by the War Department Claims Board, and it was also given an extensive original jurisdiction under that act which will presently be described. The other principal board of the War Department for the settlement of claims is the War Department Board of Appraisers constituted by General Order No. 30, of April 1, 1918. This board has the function of determining amounts due for property commandeered or requisitioned under the national defense act of June 3, 1916, section. 120, and the food control act of August 10, 1917, sections 10, 11, and 12, and may also by award in advance fix the fair price for work and property received under compulsory orders under the same acts: To it are referred also claims relating to real estate under the act of March 2, 1919. (See resolution of War Department Claims Board meeting No. 23, held Mar. 18, 1919.) In settling the claims of contractors it usually becomes necessary for the district or bureau board also to take part in or check up the settlements made by the prime contractor with his subcontractors. This involves a great number of determinations by district boards generally greatly exceeding in number the prime contract settlements. However, as these subcontractors have no contractual relations with the United States, the basis for such settlements is not so prescribed and the approval of these settlements by the bureau boards is not required. Such subcontract settlements may be approved by the district boards where they are within the limits of the amount which the subcontractor would recover from the prime contractor in an action or suit in court, but they are generally accomplished on the same basis as the settlements of the prime contractors with the United States as outlined above. An idea of the work performed by all these boards and the many thousands of officers and men and women they employ may be gained from the fact that about 21,800 War Department contracts had been settled by them up to August 31, 1919, for an aggregate sum of about $272,786,000, and that an estimated number of about 5,000 claims amounting to about $300,000,000 then remained to be settled. The settlements above made were at an average of 13 per cent of the amount which the United States would have been obligated to pay had the then unperformed parts of the contracts been completed. Other claims to a limited number coming before the Board of Contract Adjustment under the act of March 2, based on agreements made by officers or others acting under the authority of the President are not here included. LIST OF BOARDS SUPERVISING AND PASSING UPON THE ADJUSTMENT OF War Department Claims Board, Washington, D. C., Munitions Building. Board of Review for Machinery and Engineering Materials Division, War Department, Washington, D. C. Board of Review for Motors and Vehicles Division, War Department, Washington, D. C. DISTRICT AND ZONE BOARDS. ORDNANCE DISTRICT CLAIMS BOARD. Baltimore, Park Plant, Columbia Avenue, Baltimore, Md. Bridgeport, 945 Main Street, Bridgeport, Conn. Boston, 19 Portland Street, Boston, Mass. Chicago, 155 East Superior Street, Chicago, Ill. Cincinnati, corner Third and Vine Streets, Cincinnati, Ohio. Cleveland, Plymouth Building, Cleveland, Ohio. Detroit, 35 Washington Boulevard, Detroit, Mich. New York, Albermarle Building, Twenty-fourth Street and Broadway, New York City. Philadelphia, 1710 Market Street, Philadelphia, Pa. Pittsburgh, Chamber of Commerce Building, Pittsburgh, Pa. Rochester, 82 St. Paul Street, Rochester, N. Y. St. Louis, Missouri State Life Building, St. Louis, Mo. Toronto, 606 Royal Bank Building, Toronto, Canada. CHEMICAL WARFARE SERVICE. Board of Review, Gas Defense, Edgewood Arsenal. ZONE BOARDS OF CONTRACT REVIEW, OFFICE OF THE DIRECTOR OF PURCHASE AND STORAGE. Zone No. 1, Boston, Mass., 108 Massachusetts Avenue. Zone No. 2, New York City, 461 Eighth Avenue. Zone No. 3, Philadelphia, Pa., Twenty-first and Oregon Avenue. Zone No. 4, Baltimore, Md., Coca-Cola Building. Zone No. 5, Atlanta, Ga., Transportation Building. Zone No. 6, Jeffersonville, Ind., Meigs Avenue. Zone No. 7, Chicago, Ill., 1819 West Thirty-ninth Street. Zone No. 8, St. Louis, Mo., Second and Arsenal Streets. Zone No. 9, New Orleans, La., Audubon Building. Zones No. 10 and No. 12, San Antonio, Tex., General Supply Depot. Zone No. 11, Omaha, Nebr., Army Building. Zone No. 13, San Francisco, Calif., Fort Mason. Zone No. 14, Washington, D. C., Seventeenth and F Streets, NW. THE DISTRICT OFFICES OF AIR SERVICE FINANCE. Mr. W. G. Farnsworth, District Finance Manager, New York, N. Y., 360 Madison Avenue, Abercrombie & Fitch Building, Ninth Floor. 4. THE JURISDICTION OF THE BOARD OF CONTRACT ADJUSTMENT IS FROM SEVERAL SOURCES. (a) On contracts executed in accordance with the statutes. ORIGINAL JURISDICTION. General Orders, No. 103, of November 6, 1918, in creating the Board of Contract Adjustment, described its jurisdiction in the words: "It shall be the duty of the board to hear and determine all claims, doubts, or disputes, including all questions of performance or non 169715-20-3 |