Syllabus ROSS ENGINEERING COMPANY, INC. v. THE UNITED STATES [No. 48832. Decided April 6, 1954] On the Proofs Suit under War Contract Hardship Claims Act, known as Lucas Act; proof of loss.-Where the instant case is before the United States Court of Claims on the issue whether, under the facts as proved, the plaintiff has legal standing to recover under the War Contract Hardship Claims Act, commonly known as the Lucas Act, it is held that the plaintiff has a right to recover if in further proceedings it makes the necessary proof of loss. United States 74 (17) Same; losses under War contract.-In May 1943 plaintiff entered into a contract with the United States for the construction of an Armed Guard School at Camp Bradford, Virginia. The plaintiff lost money on certain phases of the performance of its contract, and requested relief for those losses under the First War Powers Act, which was denied. After the enactment of the Lucas Act, plaintiff took the prescribed steps to sue in the United States Court of Claims. Same; errors in bid; recovery not precluded. In a suit under the Lucas Act, where the Government asserts fault or negligence, within the meaning of the Act, by reason of mistakes in the contractor's bid, resulting in losses for which suit is brought; it is held that such mistakes were not such fault or negligence as to preclude recovery under the Act. The decision in Spicer v. United States, 127 C. Cls. 428, is affirmed. United States 74 (17) Same; error in estimate for road work.—In the computation of plaintiff's bid relating to some road work, a marking of square yards on a drawing was mistaken for square feet, resulting in an estimate for only one-ninth as much road to be built as actually had to be built. The mistake was called to plaintiff's attention but plaintiff thought it could make up for the loss by its profit on other parts of the contract, and did not change its bid. A heavy loss was incurred. Same; error in allowance for furnishing and installation of equipment.-Where the contract stated that the contractor should furnish and install the collateral equipment; that he should include a cash allowance of $130,000 for furnishing the equipment; and that if it cost more than that to furnish the equip Syllabus 128 C. Cls. ment, the contractor would be compensated for the additional cost, the plaintiff, in making its bid, misread the contract to mean that the $130,000 cash allowance was for both furnishing and installing the equipment, and did not include in its bid anything for installing the equipment, which work cost it a considerable sum; it is held that the mistake in bidding was not fault or negligence which barred recovery under the Lucas Act. United States 74 (17) Same; delay by excessive rainfall.-Where it is shown that the contractor's work was delayed by an excessive number of rainy days, and to make up the lost time, employees were worked overtime and were paid a large amount of premium pay therefor, entailing loss on the contractor; it is held that the loss is recoverable under the Lucas Act unless found to be due to some fault or negligence of the plaintiff. No such finding has been made. United States 74 (17) Same; losses not limited to wartime causes.-Losses recoverable under the Lucas Act are not limited to losses peculiar to wartime. United States 74 (17) Same; prior suit under instant contract.—In a prior case (No. 46804), reported 118 C. Cls. 527, where plaintiff sued the Government for breach of contract, it was held that the plaintiff's asserted construction of the contract provision relating to collateral equipment was wrong and that plaintiff had not taken an appeal from the contracting officer's refusal to grant an extension of time on account of excessive rains. Recovery was denied as a contractual right. United States 74 (17) Same; relief under Lucas Act not precluded by failure to sue on possible legal claim.-Where a contractor, who requested First War Powers relief, had, or possibly had, a legal claim which he did not pursue, it is held that he is not thereby precluded from suing for relief under the Lucas Act in the United States Court of Claims. United States 74 (17) Same; inconsistent testimony in prior suit in United States District Court. Where, in a suit in the United States District Court brought by its subcontractor against the plaintiff in the instant case, the plaintiff filed a counterclaim asserting that due to the negligence of the subcontractor in failing to complete promptly the drainage and road work which the subcontractor had contracted to perform and plaintiff had been thereby delayed and obliged to use an excessive amount of overtime work; and where in the instant suit the Government alleges that the testimony of the plaintiff's president in the District Court suit was so inconsistent with his testimony in the instant suit it would be immoral to allow the plaintiff to have the 27 Opinion of the Court benefit of his testimony in the instant suit; it is held that in the facts alleged there is no reason for, in effect, forfeiting the plaintiff's right. United States 74 (17) Mr. Bernard J. Gallagher for plaintiff. Mr. J. Roy Thompson, Jr., was on the brief. Mr. Carl Eardley, with whom was Mr. Assistant Attorney General Warren E. Burger, for defendant. MADDEN, Judge, delivered the opinion of the court: This case is before us on the issue whether, under the facts as proved, the plaintiff has legal standing to recover under the War Contract Hardship Claims Act, commonly known as the Lucas Act. The Lucas Act, Act of August 7, 1946, C. 864 § 1-6, as amended June 25, 1948, C. 646 § 37, 62 Stat. 992, 41 U. S. C. 106 note, provides that a contractor or subcontractor who furnished work, supplies or services during the war period to a department or agency of the Government which had power to give relief to contractors under the First War Powers Act, and who asked for such relief, and who suffered a loss in his performance of his contract, which loss was not compensated by profits on other Government contracts during the period, may be compensated by the contracting department for his losses, and if not compensated, may sue in this court for compensation for losses incurred without fault or negligence on his part in the performance of his contract or subcontract. The plaintiff had a contract, during the war period, to construct for the Navy Department an Armed Guard School at Camp Bradford in Virginia. The Navy Department had the power to give relief to contractors under the First War Powers Act. The plaintiff lost money on certain phases of the performance of its contract. It requested relief for those losses under the First War Powers Act. It was given no relief by the Navy. After the enactment of the Lucas Act the plaintiff took the steps prescribed by that Act to qualify itself to sue in this court, and thereafter did bring this suit. For reasons of economy the hearing held before our commissioner was limited to the taking of evidence bearing on Opinion of the Court 128 C. Cls. the causes of the plaintiff's losses, with particular reference to whether they were due to the plaintiff's fault or negligence in the performance of the contract. The fault or negligence question has been argued before the court, and also the question whether losses resulting from bad weather are compensable under the Lucas Act. The Government asserts fault or negligence, within the meaning of the Lucas Act, against the plaintiff in relation to the plaintiff's losses in two situations, each of which involved a mistake in the plaintiff's bid. In the first situation, the person who computed that part of the bid relating to some road work, mistook a marking of square yards on a drawing for square feet, hence he estimated only one-ninth as much road to be built as actually had to be built. Before the contract was made, the mistake was called to the plaintiff's attention, but the plaintiff thought it could make up for the loss by its profit on other parts of the contract, so it stood by its bid. It lost heavily, of course, on the building of the roads. In our recent case of Spicer v. United States, 127 C. Cls. 428, decided February 2, 1954, we dealt with the question of an unduly low bid as fault or negligence within the meaning of the Lucas Act. We concluded that it was not such fault or negligence; that the Government having, after the completion of the contract, generously decided to compensate the contractor for his losses, was still only paying for the value which it had received, and which it would have had to pay for in the contract price if the bid had not been unduly low. We adhere to the views expressed in the Spicer case. The other low bid situation in the instant case had to do with so-called collateral equipment. This was furniture, office machines, tables, bunks, fans, etc. The contract said that the contractor should furnish and install the collateral equipment; that he should include a cash allowance of $130,000 for furnishing the equipment; and that if it cost more than that to furnish it, he would be compensated for the additional cost. The plaintiff, in making its bid, misread the contract to mean that the $130,000 was for both the furnishing and installing of the equipment, and that if it cost more than that to furnish and install it, the plaintiff would be 27 Opinion of the Court compensated for the additional cost. It therefore did not include anything in its bid for installing the equipment, which work cost it a considerable sum. We conclude, as we have concluded with regard to the road situation, that the mistake in bidding was not fault or negligence which barred recovery under the Lucas Act. The plaintiff's work was delayed by an excessive number of rainy days. To make up for the lost time, it worked its employees overtime and paid a large amount of premium pay for the overtime work. It thereby suffered a loss. The Government says that a loss due to bad weather does not come within the reason of the Lucas Act, since contractors in peace time as well as wartime have bad luck with weather, and suffer losses therefrom. The Government does not, of course, urge fault or negligence in connection with the weather. We see nothing in the Lucas Act which authorizes us to limit the kinds of losses for which Congress granted compensation to losses peculiar to wartime. It would be difficult to administer the Act by such a test. The Government says that the plaintiff has not satisfactorily proved that the overtime employment was caused by excessive rain. If it was not, it would seem that the loss was still recoverable under the Lucas Act unless it was found to be due to some fault or negligence of the plaintiff. We have not so found. The Government says that the plaintiff had legal claims which it waived, and hence it has no rights under the Lucas Act. The plaintiff, in a case reported in 118 C. Cls. 527, sued the Government for breach of contract, claiming as damages the losses incurred on account of the collateral equipment situation and the excessive overtime resulting from delays caused by excessive rain. The court held that the plaintiff's asserted construction of the contract provision relating to collateral equipment was wrong, and that it had received all that it was entitled to under the contract in that regard. We held that because the plaintiff had not taken an appeal from the refusal of the contracting officer to grant an extension of time on account of excessive rains, it could not assert that refusal here as a breach of contract. |