139 F. Supp. 61 | Ct. Cl. | 1956
delivered the opinion of the court:
This action is brought by plaintiff
Plaintiff bases its claims upon allegations that (1) defendant failed to stockpile lumber in the required sizes and quantities needed at a single location at or near the site of the work; (2) defendant interfered with plaintiff in the hiring and recruiting of labor; (3) defendant failed to construct and maintain adequate roads in the vicinity of the work; and (4) for the return of amounts deducted from the contract price for lodging plaintiff’s employees.
Defendant denies any liability for losses on account of unavailability of lumber, recruitment of labor, or condition
The questions presented are: (1) whether plaintiff has released defendant from the claims asserted in this suit; (2) whether plaintiff suffered any unrecovered loss due to the lack of all the lumber at a single location in the sizes and quantities required and, if so, whether defendant is liable therefor; (3) whether the roads on the site of the work were different from what plaintiff should have contemplated and, if so, whether it suffered any loss and damages by reason thereof, and whether defendant may be held liable for any of it; (4) whether the conditions controlling the hiring and recruitment of labor for the work were different from that which plaintiff expected or should have expected before the award of the contract and, if so, whether defendant is liable for any loss suffered thereby;. (5) whether plaintiff’s losses on the contract in connection with any particular conditions or actions of plaintiff or defendant can be ascertained and separated in order to determine the amounts, if any, due as damages; (6) whether defendant is entitled to retain moneys assessed and withheld from plaintiff’s contract pay or collected from plaintiff for the cost of lodgings for plaintiff’s employees.
In this posture of the case, the first question to be passed upon is the assertion of defendant that all the claims in suit, except the hutment claim, have been released.
After the completion of the work and during the latter part of 1944, plaintiff filed claims with defendant for additional compensation in connection with its work under the .contract. On March 5, 1945, a formal claim asserting 10 itemized claims in the total amount of $72,543 was filed. On March 17, 1945, a final payment voucher in the amount of $73,437.16, covering monthly pay estimate No. 10 and marked “final” was sent to plaintiff with the request that the •certificate of the payee thereon be executed along with a release, as required by the contract, and returned to de
RELEASE
Approved by the Under Secretary of War March 22, 1941
The work under contract number W-742l-Eng-4 dated 11-16-43 between the United States of America, represented by E. H. Marsden, Col., Corps of Engineers, as Contracting Officer, and the undersigned contractor, having been completed and finally accepted, the United States, its officers and agents, are hereby released from all claims and demands whatsoever arising under or by virtue of said contract, except as follows:
See list attached.
Executed this 24th day of March 1945.
Coupe CowstruotiON,
(Contractor)
By A. L. Coupe [s],
(Official Title)
Partner.
* * * * *
Subsequently the contracting officer allowed the claims as listed in items 4, 5, and 6 of the specifications, and on appeal the head of the department allowed items 1, 2, and 3, and payments thereon have been made to plaintiff in the total amount of $16,156.54. The claims set out in items 7, 8, and 10 of the specifications were denied by the contracting officer and the head of the department. Item 9 of the claim for hutment charges was allowed to the extent that it was found that the hutment services were not part of the construction contract and the deductions thereon could not be made from the construction contract. Item 7 of the claim was denied by the head of the department on the grounds
On November 13,1943, the board of directors of the A. L. Coupe Construction Company, Inc., adopted a resolution which “authorized, empowered, and directed” Mr. Mueller to “execute all contracts, letter contracts and other papers, and do all things and perform all acts necessary or incident thereto” in connection with construction at Oak Ridge. The form for signature was specified as “Coupe Construction, by A. L. Coupe Construction Company, Inc. — General Partner, by — C. W. Mueller, Vice President.” However, this instruction appears to have been almost completely ignored.
Mr. Coupe was not only one of the limited partners, but also was president of the general partner, the corporation, and as such was the individual in practical control of the partnership operations. It is true that by the laws of Kentucky, under which the partnership was formed,.and by the articles of partnership, the limited partners were without authority to sign for the partnership and such authority was vested only in the general partner. While Mr. Mueller was project engineer authorized to act for the managing
The plaintiffs in this suit joined in a partnership to do business under the partnership name of “Coupe Construction.” That name was used to accept the contract here involved. It was used to accept the nine change orders to the contract. It was used to submit the various claims and all other correspondence to defendant. All official acts of the partnership were performed in the name of “Coupe Construction.” The partnership business stationery was printed with the heading “Coupe Construction.” The release was executed in the name of “Coupe Construction.” It cannot be denied and is apparently conceded that “Coupe Construction” was the proper party to sign the contract and the release required by it. However, plaintiff says that Mr. Coupe had no authority to bind Coupe Construction in such a release and that Mr. Coupe signed as a partner and not as an official of the A. L. Coupe Construction Company, Inc., the managing partner.
The partnership agreement provided that the corporation as managing partner should devote its entire resources and personnel to the business of the partnership insofar as necessary, but that the special partners should take no part in the management of the business or transact any business for the partnership or sign for it or bind it. Mr. A. L. Coupe was not only one of the special partners, but also was the president of the corporation which was the managing partner. He knew he lacked authority as special partner to bind the partnership and from the facts in this case, it must be presumed that when he took official action in connection with the contract he acted as a representative of the corporation, which was the managing partner, and not for himself as a special partner. If Mr. Coupe signed as a special partner there could be no doubt that his signature
Thus, we conclude that the release is valid and binding upon plaintiff. The question then arises as to which claims in the suit were set out in the exceptions to the release, the rule being that claims not set out in an exception are released and cannot be sued upon. P. J. Carlin Construction Company v. United States, 92 C. Cls. 280, 305.
Article 16- of the contract, entitled “Payments to contractor,” provides in pertinent part as follows:
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(d) Upon completion and acceptance of all work required hereunder, the amount due the Contractor under this contract will be paid upon the presentation of a properly executed and duly certified voucher therefor, after the contractor shall have furnished the Government with a release, if required, of all claims against the Government arising under and by virtue of this contract, other than such claims, if any, as may be specifically .excepted by the contractor from the operation of the . release in stated amounts to be set forth therein.
There were 10 exceptions. Subsequently the contracting officer paid Nos. 4, 5, and 6 and the head of the department paid Nos. 1, 2, and 3. Items 7 and 10 were denied by the contracting officer, but are not included in this case. Item 8 is for “additional costs incurred in transporting and handling lumber requirements,” and would come under the claim in the petition that the Government failed to stockpile lumber in a single site and thereby breached the contract. Item 9 is for credit for hutment charges — amounts withheld on contract settlements and paid to Koane-Anderson Company. • ;
Two questions are presented under plaintiff’s claim for damages due to defendant’s failure to stockpile lumber in a single site. First, did defendant breach the contract in that respect; and second, if so, did plaintiff suffer damage which can be ascertained.
A summary of the facts in relation to the lumber claim, is as follows. The lumber requirements for the Manhattan' District were submitted to the Army Corps of Engineers who centrally procured lumber. Set forth in the requests would be the quantities, general sizes, and species of lumber required. The Corps of Engineers then placed orders for the lumber as requested. At times the mills became late in their shipment schedules and Stone and Webster, the managing contractor, pursuant to authority granted, procured lumber by direct purchase from any sources found available. In such cases procurement costs were higher to defendant. In addition to this, standing timber on the townsite was cut, a sawmill was established at the site, and lumber was fabricated from the logs and installed in the various houses and projects then under construction. In addition, Stone and Webster, pursuant to authority, fabricated smaller sizes of lumber from larger sizes when required. For example, 2" x 4"s would be ripped from 2" x 8"s. Lumber was in short supply and was secured from whatever source found available. Five million board-feet of lumber had been secured from the timbers in an ore dock at Mesabe Range and usable lengths and sizes fabricated therefrom. It was difficult to get adequate lum
Before plaintiff accepted the contract it had performed housing construction work for the Government in other areas, particularly in Kentucky and Indiana. At those places the operations had been carried on through the process of establishment of a central point for the fabrication of lumber and through construction by specialized crews moving from one building to the next in sequence. Plaintiff expected to use the same procedure on the contract at Oak Ridge. However, no mention was made of such plans to defendant’s agents and representatives prior to the time of the award of the contract or at any time during performance.
At the time plaintiff’s representatives visited the site preparatory to bidding, the several lumberyards were in operation in Oak Ridge and were being used by other contractors. After the contract was awarded and after the letter contract was submitted, Mr. Coupe was orally advised by a representative of Stone and Webster, the managing contractor for the Government, that lumber would be secured for the construction of the housing project from the lumberyard for Townsite No. 3 and the location thereof was pointed out. On November 18, 1943, this representative of Stone and Webster wrote plaintiff that the lumber requirements for the housing project to be undertaken by plaintiff would be secured from Townsite Lumberyard No. 3 and set out certain procedures to be followed in handling the lumber, including a requirement that requisitions be made for lumber needed in ample time to permit the materialmen to verify the lumber as available. The letter further stated that it
Plaintiff did use the lumberyard at Townsite No. 3 but at times it was necessary for it to procure lumber from other yards in the area. The supply of lumber was never depleted on the project but at times the required sizes, shapes and lengths were not present and it was necessary for Stone and Webster to fabricate the lumber in the sizes needed from other available sizes. When lumber of longer lengths than was needed was furnished, plaintiff’s project was not charged with the additional length. The additional lengths did not cause plaintiff any inconvenience because it was necessary to cut off the ends in order to square them even when the lumber submitted was of the required lengths. Thus, it' was no more difficult to cut off the longer lengths in the squaring process than to cut off the smaller lengths for the same reason.
Plaintiff was not delayed for the lack of lumber and only one specific delay was shown which was as long as one day when it was impossible to get lumber of a tongue- and-groove variety for roofing. In that case, plaintiff was permitted to proceed by using square-edge lumber instead of the tongue and groove.
Defendant made every effort to provide plaintiff with lumber under very trying circumstances. Cost was not spared in this effort. There was no hesitancy on anyone’s part to fabricate smaller sizes from larger sizes or to sacrifice longer pieces in order to provide requirements in shorter lengths. The operations of the lumberyards were so organized that the smaller yards could requisition their requirements from the larger central yard as the need arose. For this reason the contractors were requested to submit orders sufficiently in advance to permit such requisition. If due to lack of notice by a contractor it was impossible to fill such an order when the contractor’s truck arrived, then whatever lumber was available in the smaller yard was furnished or the truck would proceed to the general lumberyard or some other yard where it was available. However,
Plaintiff was furnished an area for its office and storage buildings and for a storage yard. It could have established a central lumber fabricating operation at that point if it had so desired. Plaintiff never requested permission to set up a central fabricating plant at any of the lumberyards or at its own area. It could have established such, a plant in its own area without permission to do so from anyone. Some of the other contractors did establish such plants in their own areas. Plaintiff did not at any time before the letting of the contract or during the course of the job complain that lumber was not being stored properly for it or that a central place for fabrication was not established, permitted, or available.
During the course of the construction work, plaintiff was furnished some green and otherwise defective lumber. Such was installed in the buildings and plaintiff was required to remove and replace it. It submitted a request for additional compensation therefor in the amount of $14,822.18 and was paid in that amount by change order No. 7 on September 30, 1944. The change order was accepted by plaintiff without protest. In this change order the costs to plaintiff were itemized and the additional amount of lumber used was noted. The change order also credited plaintiff with the additional lumber used.
Any delay occasioned to plaintiff’s construction work due to the unavailability of lumber was by reason of its failure to request the lumber sufficiently in advance to permit defendant to fabricate the required sizes from larger pieces.
The specifications relating to the stockpiling of lumber and delays by reason of failure to deliver materials to be furnished by the Government provide as follows:
2-04 Materials Furnished by the Government:
a. Lumber in grades indicated in the Form of Bid has been or will be procured by the Contracting Officer, and will be stockpiled for the use of the Contractor at the site. Each bidder will submit with his bid a statement of his lumber requirements for each type of building. Lumber up to the amount stated in the successful bidder’s proposal will be issued to him without charge at the above designated stockpile. Transportation and handling charges thereafter will be at the expense of the Contractor. Lumber required by the Contractor in excess of that issued from stockpile or for items not listed is to be furnished by him at his own expense. For purpose of evaluating and comparing bids, prices indicated in the tabulation included in the Form of Bid will be used. The value of the lumber, thus computed, will not become a part of the contract consideration. *****
2-05 Commencement, Prosecution, and Completion: * * * * *
c. If the completion of the undertaking to be performed under the terms of this contract be delayed by reason of delay in delivery of materials, equipment, or supplies to be .furnished by the Government and which are essential to such performance, such delay shall not constitute basis for any claim against the Government, but. the time of performance will be extended for a period equal to such delay.
The facts show that at the time plaintiff’s representatives visited the site, preparatory to filing a bid, several lumberyards were in operation in Oak Nidge. They were being used by the various contractors, both fixed price and cost plus, as a source of lumber furnished by the Government. The record does not show what notice, if any, was taken of such lumberyards by plaintiff’s representatives or whether any inquiry was made by them concerning the source or manner of furnishing lumber to the project under consideration prior to the bid.
On November 18, 1943, the plaintiff was informed by letter that lumber requirements would be withdrawn from a certain lumberyard and in fact lumber was secured from that yard. However, plaintiff contends that the lumber should have been stockpiled and ready in advance so there would be no delay in securing the lumber as needed.
Because of the magnitude of the project then under construction, it was impossible for the Government to keep on hand all the sizes and quantities required. In order to avoid all possible delays, the Government requested that orders be sent in ahead of time. At all times, if sufficient advance warning was given, lumber was cut to size and available to plaintiff for use on the job. Any delays were due to plaintiff’s failure to order lumber in advance. Inasmuch as the contract contains no provision for advance stockpiling, we can find no negligence on the part of the Government in this practice, nor does this constitute a breach of the contract. Plaintiff’s claim must therefore fail as to this item.
We then turn to plaintiff’s claim for return of amounts withheld on contract settlements and paid to Eoane-Ander-son Company.
A summary of the facts relative to this claim is as follows. After the project at Oak Kidge got underway, the question
Coupe Construction established its own labor camp at Norris, Tennessee, a distance of approximately IS miles each way from the city of Oak Bidge. However, beginning in late January 1944, the camp became inadequate and some of its employees were sent to the Government’s hutments for housing at Oak Bidge. Charges of 40 cents per night per employee were assessed against plaintiff for such employees and such charges were deducted from its monthly partial payments beginning with monthly pay estimate No. 5, dated April 22, 1944. The first deduction covered the
As early as November 14, 1943, plaintiff had stated in writing that it would be able to house 80 men immediately, but asked the Government to supply housing for its colored labor. The housing arrangement for labor was one of the job conditions, and plaintiff was fully aware of the arrangements and the fact that it was expected to pay 40 cents per night for the housing of each of its employees. It participated in such arrangement by supplying identifications and tickets upon which the employees were admitted to the hutment facilities as its employees. It also cooperated with the
Plaintiff now asserts that it was not obligated to pay for' the housing of its employees and there existed no contract between it and defendant for such services. While the record does not show that plaintiff was ever formally advised or that plaintiff ever expressly agreed to pay such charges, certainly its employees did use the facilities furnished by the Government. In the bid form, space was provided for each bidder to specify the amount included for the purpose of housing, feeding, and transporting of labor for the project. ' The schedule of prices, set out in the contract, specified “the above contract price includes the cost of all housing, feeding, and transportation of labor for the project.” Coupe Construction specified no allowance for housing, feeding, and transportation of labor in its bid, and its representatives were called in and told that the labor situation should be investigated and that the housing, feeding, recruitment and transportation of labor would be the responsibility of the contractor. Under the conditions existing at the time, plaintiff could not have retained any labor without arrangements for housing. This was called to plaintiff’s attention and a suggestion made that plaintiff make “on-the-spot” investigation. After plaintiff did make such investigation, it was permitted to raise the bid $30,000 and include that amount for the housing, feeding, and transportation of labor for the project. Thereafter arrangements were made to house plaintiff’s employees in the Government hutments at Oak Kidge. Deductions were made from their monthly partial payments beginning with monthly pay estimate No. 5, dated April 22, 1944. At a later date, in response to billing by defendant’s agents, plaintiff paid by check $2,036.80 for hutment charges. The deductions were accepted by plaintiff without protest until after the work was completed. Furthermore, a system was worked out whereby plaintiff would advise defendant’s agents dates of termination of employment and listing the names of
Therefore, we conclude that the hutment services rendered plaintiff’s employees were at the request of plaintiff and, further, that plaintiff was aware of the fact that it would be expected to pay for such services. After this knowledge plaintiff continued to request the services and continued to pay for them. While there was no express agreement to pay, we conclude from the foregoing that a contract is implied, and plaintiff cannot escape liability for the hutment charges. See Niagara Falls Bridge Commission v. United States, 111 C. Cls. 338.
For the foregoing reasons, plaintiff’s petition is dismissed.
Since the hutment claim is for moneys retained by defendant by reason of arrangements outside the construction contract, defendant filed a counterclaim therefor. However, the money in question is still in the hands of defendant, and inasmuch as we have determined that plaintiff has no right thereto, defendant’s counterclaim is dismissed.
FINDINGS OF FACT
The court, having considered the evidence, the report of Commissioner Currell Vance, and the briefs and argument of counsel, makes findings of fact as follows:
1. On May 12, 1942, plaintiffs, A. L. Coupe Construction Co., A. L. Coupe, and E. G. Barker, joined in a partnership under the firm name of Coupe Construction for the purpose of securing and performing contracts for housing for defendant at Fort Knox, Kentucky. The partnership’s principal place of business was listed as Louisville, Kentucky. Plaintiffs E. G. Barker and A. L. Coupe were limited partners with no power of management. The A. L. Coupe Construction Co., a corporation organized under the laws of the
2. On November 27, 1943, plaintiffs, trading as Coupe Construction, referred to herein as tbe contractor, accepted a negotiated contract with defendant dated November 16, 1943, to furnish all tools, equipment, labor and materials (except that furnished by tbe Government) and perform all work required for tbe construction and completion of 500 dwelling units in 125 dwelling buildings at Oak Badge, Tennessee. More specifically, tbe construction was of 50 “K”-type houses consisting of 4 dwelling units each; 60 “L”-type houses consisting of 2 dwelling units each; and 15 “N”-type houses consisting of 12 dwelling units each. The total estimated consideration was $1,683,450, based upon plaintiffs’ unit bids for each dwelling unit. Tbe contractor was to commence work within five days after notice to proceed and complete all work within 120 days thereafter. Liquidated damages for delay were not prescribed. Notice to proceed was accepted on November 27, 1943, thus establishing the completion date as March 26, 1944. However, the completion date was extended a total of 80 days to June 15, 1944. All the houses constructed under the contract were accepted as complete on August 10,1944. Defendant gained beneficial occupancy thereof on July 31,1944. No claim was made to the contractor because of the delay in completion. By changes the total consideration of the contract was increased to $1,831,823.62.
3. The contract was written on standard War Department Construction Contract Form No. 2 and contained the cus
Article 13. Other contracts. — The Government may award other contracts for additional work, and the Contractor shall fully cooperate with such other Contractors and carefully fit his own work to that provided under other contracts as may be directed by the Contracting Officer. The Contractor shall not commit or permit any act which will interfere with the performance of work by any other contractor.
Article 16 of the contract entitled “Payments to contractor” provided in pertinent part as follows:
(d) Upon completion and acceptance of all work required hereunder, the amount due the Contractor under this contract will be paid upon the presentation of a properly executed and duly certified voucher therefor, after the contractor shall have furnished the Government with a release, if required, of all claims against the Government arising under and by virtue of this contract, other than such claims, if any, as may be specifically excepted by the contractor from the operation of the release in stated amounts to he set forth therein.
The specifications incorporated as part of the contract by Article 1 provided in pertinent part as follows:
1-03 Contracting Oificer:
a. The term, Contracting Officer, as used herein shall be taken to mean the officer who signs the contract, his duly appointed successor or his authorized representative.
b. The Stone & Webster Engineering Corporation, Architect-Engineer-Manager, under Contract Number W-iT421-eng-119 has been designated as the Construction Manager representative of the Contracting Officer, with full authority to supervise all work to be done under these specifications, and to make all decisions and to take all action in connection therewith except decisions and actions under Articles 3, 4,_ 9 and 15, of the Contract and any provisions of the specifications supplementary to these Articles.
c. Skidmore, Owings & Merrill and W. Earle Andrews, Architect-Engineer under Contract No. W-7401*411 eng-69, has been designated as the Architect-Engineer representative of the Contracting Officer, with full authority to inspect construction work for quality and for compliance. with Plans and Specifications. _
_ d. The Contracting Officer will not be responsible for any oral instructions, and no oral proposals or modifications will be considered.
1-04 Order of Work ’ The work shall be carried on at such places and also in such order of precedence as may be found necessary by the Contracting Officer, and shaU be constructed in every part in strict accordance with the drawings and specifications and in exact conformity with all location and limit marks established by the Contracting Officer. * * *
1-09 Priority Bating ' A priority rating of AA-2X has been assigned to this Project and may be applied, subject to applicable regulations, to the delivery of items that are required by the Contractor.
1-11 Physical Data: From inspection made at the site, it is believed that physical conditions are approximately as indicated on the drawings. However, it is presumed that, before submitting his proposal, the Contractor has visited the site and carefully examined the drawings and specifications and has fully informed himself as to all existing conditions and limitations, including all laws, ordinances and regulations affecting the contract or the work, and has included in his proposal all items implied or required to attain the completed conditions contemplated by the contract. The Contractor shall familiarize himself with the features and details of the entire development in so far as they may tie in with, or in any manner concern his work. Failure to conform to this requirement shall not relieve the Contractor of any of the obligations of his contract.
1-12 Payments: Payments will be made in accordance with Article 16 of the contract. All partial and final payments shall be subject to deductions for telephone service, temporary use of equipment, any material, service or labor (including taxes, and overhead thereon) furnished by the Government, the Construction Manager, or any other Cost-Plus-Fixed fee Government Prime Contractor for which it is specified or thereafter agreed upon, by the Contractor and the Contracting Officer, that a charge will be made.
1-14 Organization, Plant, and Progress:
*412 d. The Contractor shall within five (5) days after issuance of notice to proceed, prepare and submit to the Contracting Officer for approval a practicable and feasible schedule showing the order in which the Contractor proposes to carry on the work, the dates on which he will start the several salient features (including procurement of materials, plant and equipment) and the contemplated dates for completing the same. The schedule shall be in the form of a progress chart of suitable scale so as to indicate appropriately the percentage of work scheduled for completion at any time. The Contractor shall enter the actual progress at the end of each week and shall immediately deliver to the Contracting Officer three (8) blueprint copies of the same.
1-34 Interpretation of Specifications: On all questions relating to the acceptability of materials or equipment, classification of materials, the proper execution of the work, and the interpretation of the specifications, the decision of the Contracting Officer shall be final, subject to appeal, as provided for in Article 9 of the contract.
2-04 Materials Furnished by the Government:
a. Lumber in grades indicated in the Form of Bid has been or will be procured by the Contracting Officer, and will be stockpiled for the use of the Contractor at the site. Each bidder will submit with his bid a statement of his lumber requirements for each type of building. Lumber up to the amount stated in the successful bidder’s proposal will be issued to him without charge at the above designated stockpile. Transportation and handling charges thereafter will be at the expense of the Contractor. Lumber required by the Contractor in excess of that issued from stockpile or for items not listed is to be furnished by him at his own expense. For purpose of evaluating and comparing bids, prices indicated in the tabulation included in the Form of Bid will be used. The value of the lumber, thus computed, will not become a part of the contract consideration.
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c. Checking Equipment and Material Delivered■' The Contractor shall check the quantity and condition of all equipment and material delivered to him. After the equipment and material has been accepted by the Contractor, he shall be responsible for all damage or shortage of equipment and material furnished by the Government and shall replace all shortages and make all repairs to damaged equipment and material at his*413 own expense in a manner satisfactory to the Contracting Officer.
* * * * *
e. Ready-Mine Concrete• The Government will furnish 2,000# ready-mix concrete to the Contractor. Each bidder will submit with his bid a statement of the amount of such concrete he will require for the construction specified. Concrete up to the amount stated in the Contractor’s proposal will be furnished him without charge. For the purpose of evaluating and comparing bids the cost of concrete will be used but the value of the concrete thus computed will not become a part of the contract consideration. If the Contractor requires concrete in excess of the quantity specified in his proposal, then such concrete shall be furnished to the Contractor by the Government at the cost to the Government, plus 10% charge for handling. The ready-mix concrete will be delivered by truck to a point on an established road nearest to the place of final deposit. That portion of the specifications contained in “Concrete” referring to the composition, testing of aggregates, proportioning, mixing and delivery to the site do not apply under this contract to the concrete furnished by the Government. The specifications for placing, finishing, curing and protecting concrete will remain unchanged.
2-05 Commencement, Prosecution, and Completion:
* * * Me *
b. If the completion of the undertaking to be performed under the terms of this contract be delayed by reason of delay in delivery of materials or supplies essential to such performance because of National Defense Priorities, and without fault or negligence of the Contractor, the time of performance will be extended for a period equal to such delay and subject to appeal as provided in the contract.
c. If the completion of the undertaking to be performed under the terms of this contract be delayed by reason of delay in delivery of materials, equipment, or supplies to be furnished by the Government and which are essential to such performance, such delay shall not constitute basis of any claim against the Government but the time of performance will be extended for a period equal to such delay.
2-06 * * * Location of Lumber Btoclepile:
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b. It shall be the responsibility of the Contractor to transport all material, tools and equipment to the job-*414 site at his own expense. Bail facilities are available to Elza, Tennessee. Certain railroad and road facilities are constructed and will be constructed within the project area. These facilities may be determined on inquiry to the Contracting Officer.
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d. The Contractor shall visit the site to determine the location of the warehouse for storing certain items of equipment and materials furnished by the Government, and for the location of the lumber stockpile referred to in Paragraph 2-04 hereof.
2-07 Roads: All roads will be constructed and maintained by others. However, sewer and water lines and house connections will be constructed at the same time as the work under this specification and the full width of the roadway may not be available at all times or short detrous [detours] may be necessary as directed by the Contracting Officer.
2-09 Measurement and Payment:
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All partial and final payments shall be subject to deductions for ready mix concrete (in excess of the quantity specified in the Contractor’s proposal); telephone service and any other material or service furnished by the Government, for which it is specified or agreed that a charge will be made, but payments will not be subject to deductions for ready-mix concrete (within the quantity specified in the Contractor’s proposal), lumber (within the quantities and grades specified in the schedule of “Lumber Quantities”), specified equipment to be installed under this contract, wafer or electric power, or any other material or service furnished by the Government, for which it is specified or agreed that a charge will not be made.
7-02 Lumber: It shall be the responsibility of the Contractor to incorporate in the finished work only such material as will meet the inspection approval of the Contracting Officer regardless whether material is furnished by the Government or the Contractor.
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4. Nine change orders were issued during performance of the contract, resulting in adjustments of the amount of consideration and the amount of time allowed for completion of the work.
5. An invitation to bid was sent to plaintiffs about October 27 or 28,1943, and their bid was filed on November 9, 1948.
6. Oak Ridge consisted of approximately 60,000 acres, 18 to 20 miles long, and 47 miles wide, and was located approximately 7 road miles from Clinton, Tennessee, and about 25 miles north of Knoxville. The whole 60,000 acres belonged to the Government and was under the control of the War Department’s Manhattan District formed to develop the atomic bomb. The Government constructed and operated the project largely through four management type contractors, supervising approximately twenty construction prime contractors. The town of Oak Ridge was operated for the Government under a cost-plus-a-fixed-fee arrangement by the Roane-Anderson Company. At the time the contract was let to Coupe Construction, the Government had under construction a total of approximately 3,500 dwelling units, plus related facilities such as schools, stores, restaurants, a small central shopping section, and the town proper, as well as the facilities for manufacture of the atomic bomb. There were approximately 36,000 employees of the contractors to be housed and fed in the community. Because the large number of employees overtaxed the housing facilities and particularly the sanitary facilities of the community, the Government constructed hutments for the housing of its own and contractors’ employees under the management of a cost-plus-a-fixed-fee contractor. However, a few contractors constructed their own camps for housing employees. The demand for immediate increase in the housing facilities for
7. Bids for construction of the 500 dwelling units involved in the contract pertinent to this suit were received from seven bidders. The bids were opened on November 9,1943, and Coupe Construction was found to be the lowest bidder. Thereafter on November 16,1943, defendant issued to plaintiffs a letter contract for the construction of the work in accordance with the specifications which were incorporated by reference into the letter contract. It was also specified that the letter contract would be supplemented by the execution of a more formal contract on standard form. This letter contract was accepted by plaintiffs on November 27, 1943. This letter contract had attached and incorporated therein a schedule of prices which were specified as including “the cost of housing, feeding, and transportation of labor for the project.” These prices were those set out in plaintiffs’ bid. There was also attached a schedule of quantities showing the quantity of lumber to be furnished by the Government for the completion of the houses as set out in plaintiffs’ estimate in their bid, and a quantity of ready-mix concrete also to be furnished by the Government in the quantity estimated in plaintiffs’ bid.
8. After plaintiffs received the letter contract, Mr. A. L. Coupe, one of the partners and president of Coupe Construction Company, the general and managing partner, went to Oak Nidge about November 18, 1943. After his arrival, a conference was had by Mr. Coupe and other representatives of plaintiffs, and representatives of Stone & Webster, managing contractor, and of the contracting officer. At
9. During the progress of the work, changes were made from time to time by the use of construction memoranda issued by the contracting officer upon the recommendation of Stone & Webster, the managing engineer, or Skidmore, Owings & Merrill, the architect. Based upon claims submitted by plaintiffs, change orders were issued from time to time to cover any additional increase or decrease in the amount of the contract because of such changes as set out in the construction memoranda. In all, nine change orders were issued increasing the contract a net amount of $111,726.02 and extending the contract time by a total of 80 days. In each instance, plaintiffs accepted the change order with the stipulation that all other terms and conditions of the contract should remain the same. Change Order No. 2, issued April 13, 1944, allowed an increase of 35 days to April 30, 1944, for the completion of the contract. While the change
The amounts and time extensions in the change orders were usually based upon requests submitted by plaintiffs.
Change Order No. 7 included the amount of $14,822.18 as an allowance to plaintiffs because the contractor had installed a sizable quantity of inferior grade lumber furnished by defendant. In many instances, such lumber was installed and had to be taken out and replaced. In other instances it was necessary to rework the lumber furnished so as to eliminate defects, and in many instances to resaw 2" x 4"s from 2" x 8"s or 2" x 12"s. Plaintiffs’ request for an additional allowance of 108,622 FBM of lumber because of wastage was also allowed. Plaintiffs’ compensation included increased cost of labor for applying the beveled siding, cost of removing and replacing lumber, cost of hauling and distributing, cost of clean up and hauling waste, resawing, cost of picking up the lumber at the saw and distributing it, plus four percent for Social Security, ten percent for overhead, and ten percent for profit.
10. After the completion of the contract and during the latter part of 1944, plaintiffs filed claims with Stone & Webster Engineering Corporation, architect-engineer-manager for the Government, for additional compensation. These claims were denied by Stone & Webster on J anuary 2, 1945. By letter dated March 5, 1945, plaintiffs reasserted ten claims to Stone & Webster, as follows:
Re: Contract W-7J$l-Eng-li.
In reply to your letters of J anuary 2,1945, in which you disallowed numerous claims for additional compensation, we wish to state that we again submit the claims enumerated below and we request that any part of the claims which you cannot see your way clear to pass, that prior to your rejection, the matter be referred to conference with the District or Area Engineer, yourselves and representatives of our company:
Item "No. Brief Description Amount of Claim
1. Furnishing and installing quarter round around heater ducts oh 110 K & h houses, plus additional cost on account of blocking for quarter round and increase in lumber allotment at no charge to us in amount 4,000 FBM-— $2,244.04
*420 Item No. Brief Description Amount of Claim
2. Furnishing and installing quarter round in all vertical angles in E, L & N Houses — 150,000 lineal feet-$13,125.00
3. Furnishing and installing quarter round in all angles of coal rooms — 9,000 lineal feet_ 787.50
4. Furnishing and installing 1*4" x 6” casing on either side of porch columns on N type houses_ 608.53
6.Additional cost on account of blocking electric outlets — 5,960 sets of blocking @ 250 each and lumber allotment of 4,000 FBM at no charge_ 1,490.00
6. Additional lumber cost on account of change in grade_ 2, 706.65
7. Credit due on lumber billing_ 1,423.67
8. Additional costs incurred in transporting and handling lumber requirements- 15,708.41
9. Credit for hutment charges — amounts withheld on contract settlements and paid to Roane-Ander-son Company_ 9,699.20
10. Additional costs due to overhead costs incurred by delays caused by changes in details, construction and shortage of Government supplied material_ 24,750.00
Total_ 72,543. 00
11. On March 17, 1945, a voucher in the amount of $72,437.16 covering monthly pay estimate No. 10 marked “final” under the contract was sent to plaintiffs with the request that the certificate of the payee be executed along with the release approved by the Under Secretary of War and returned to defendant in order that the voucher might be placed in line for prompt payment. Previously, representatives of Stone & Webster had sent to plaintiffs a copy of a release for execution with the statement that final pay estimate was being prepared and that the release would be required in connection therewith. On March 24, 1945, plaintiffs executed the release requested by defendant. It was signed Coupe Construction by A. L. Coupe, partner. The partnership was then being conducted by the general partner Coupe Construction Company in the name of “Coupe Construction” and Mr. A. L. Coupe was then president of Coupe Construction Company. The release was transmitted to defendant along with pay estimate No. 10, and payment was made thereon in the amount of $72,437.16 on April 2, 1945. No amount was withheld on this estimate as retained percentage or for the purpose of keeping the contract open. The release was in pertinent part as follows:
*421 RELEASE
Approved by the Under Secretary of War March 22,1941
The work under contract number W-7421-Eng-4 dated 11-16-43 between the United States of America, represented by E. H. Marsden, Col., Corps of Engineers, as Contracting Officer, and the undersigned contractor, having been completed and finally accepted, the United States, its officers and agents, are hereby released from all claims and demands -whatsoever arising under or by virtue of said contract, except as follows:
See list attached.
Executed this 24th day of March, 1945.
Coupe CONSTRUCTION,
(Contractor)
By A. L. Coupe [s]
(Official Title)
Partner.
si: **•■;: *
The list attached was as follows:
Item No. Brief Description Amount of Claim
1. Furnishing and installing quarter round around heater ducts on 110 K & L houses, plus additional cost on account of blocking for quarter round and increase in lumber allotment at no charge to us in amount 4,000 FBM_$2,244.04
2. Furnishing and installing quarter round in all vertical angles in K, L & N houses — 150,000 lin. ft__ 13,125.00
3. Furnishing and installing quarter round in all angles of coal rooms — 9,000 lineal feet_ 787.50
4. Furnishing and installing 1%" x 6" casing on either side of porch columns on N type houses— 608.53
5. Additional cost on account of blocking electric outlets — 5,960 sets of blocking @ 25i each and lumber allotment of 4,000 FBM at no charge_ 1,490.00
6. Additional lumber cost on account of change in grade_ 2,706. 65
7. Credit due on lumber billing_ 1,423.67
8. Additional costs incurred in transporting and handling lumber requirements- 15,708.41
9. Credit for hutment charges — amounts withheld on contract settlements and paid to Koane-Anderson Co_ 9,699.20
10. Additional costs due to overhead costs incurred by delays caused by changes in details, construction and shortage of Government supplied material_ 24,750.00
Total_ 72,543.00
See our claim to Stone & Webster Engineering Corporation dated March 5,1945.
13. It is plaintiffs’ strenuous insistence that the release hereinabove referred to is a nullity because it was not signed by the general partner Coupe Construction Co., Inc., but rather by A. L. Coupe, one of the limited partners.. It is true that by the laws of Kentucky, under which the partnership was formed, and by the articles of partnership, the limited partners were without authority to sign for the partnership, and such authority was vested only in the general partner.
On the other hand, A. L. Coupe was not only one of the limited partners but was president of the general partner, the corporation, and as such was the individual in practical control of the partnership operations. Not only so, but the record discloses that it was almost the uniform practice of the partnership in signing various documents, including acceptance of change orders, to disregard the stated requirement and omit the designation of the corporation general partner as signatory thereto.
14. Plaintiffs’ claims in this suit may be outlined by reference to their counsel’s opening statement, as follows:
The big, essential point of our claim, sir, is that the government failed to stockpile the lumber in a single site. That is the first breach which we claim.
The second breach is that the government failed to have the lumber there and to issue it to us as needed for the construction work. It is our contention that the lumber under the contract should have been issued as needed for the construction work so that the construction could go along in an orderly coiirse, economically and in sequence rather than just haphazardly.
In addition, the government, not only failed to have the lumber available, but in an effort to do something with the high priority character of the project it issued to us all kinds and sizes and shapes of lumber different from those specified in the contract and different from those which it was obligated to furnish to us.
The result was that these sizes and shapes involved additional labor costs and costs of handling. That, I think, was the lumber portion of the claim.
*424 Now, with respect to roads; it was represented to ns that the roads would be down in time for construction work to proceed. The difficulty was that with the confusion and urgency of the project they simply were not done in time, which further increased the cost of handling rough lumber and also caused certain damage with respect to broken axles on the trucks and repairs and servicing of the trucks.
Then, the third item of damage which we have and for which we claim the government breached the contract is that the contract obligates the contractor to furnish all the labor necessary to build the houses and to do the work. There is nothing in the contract of any restriction or interference with the contractor’s recruiting of labor, yet, after the job had been started, Mr. Coupe and the whole project biad a rather rough surprise, shall I say, in the sense that they were suddenly told that they could not recruit labor when and where they wished, but they could only recruit labor in certain places and at certain times, according to the ideas of the Director of War Manpower Commission in the area.
We shall show that the practice was for the War Manpower Commission either to write letters or to issue orders by telephone in which it would be stated that recruiting could only be done in certain places.
We shall further show that it was Mr. Coupe’s plan to recruit a large proportion of competent labor in Kentucky, where his organization is well known, and where certain skilled craftsmen were well known to his organization, but that the War Manpower Commission prevented him from being able to recruit labor there and also from being able to recruit and provide labor which he ordinarily would have done in the course of discharging his obligation under the contract.
Then, there is the claim for hutments. So, I think they may be described as four claims altogether and that I think is a general statement of our claim here today, sir.
LUMBER
15. Plaintiffs had had previous experience in the construction of multiple unit housing projects, and had in such work used the assembly line plan of construction. In such method a central fabricating plant is set up where all lumber is sorted and cut to sizes and distributed to the various units in such sequence that individual crews can proceed from one unit to the next, performing on each unit the same item
Plaintiffs had planned to adopt this assembly line system in performing the instant contract. They had understood from the provisions of the specifications, from the letter to them of B. F. Hall, Division 4 Superintendent, of November 18, 1943, and from conversation with Government officials at the site that all their lumber requirements would be stockpiled at one lumberyard and that it would be possible for them to set up a central fabricating plant at such yard. Plaintiffs did not discuss with the Government officials in advance of acceptance of the contract such plan of procedure, and were unable to put it into practice at any of the Government lumberyards because such yards were not for the exclusive use of any one contractor, but for the use of contractors on various Government jobs.
In this situation plaintiffs did not set up a central fabricating plant in their own area, but brought to the project several portable saws which they moved about from place to place as the work progressed.
16. At the time plaintiffs’ representative visited the site, preparatory to filing a bid, several lumberyards were in operation in Oak Eidge. They were then being used by the various contractors, both fixed price and cost plus, as a source of lumber furnished by the Government. The record does not show what notice, if any, was taken of such lumberyards by plaintiffs’ representative or whether any inquiry was made by him concerning the source or manner of furnishing lumber to the project under consideration prior to the bid.
17. On approximately November 20, 1943, after plaintiffs had received the letter contract, but before their acceptance of it, a small lumberyard then being used as the lumberyard for Townsite No. 3 by other contractors, under the jurisdiction of Stone & Webster, was pointed out to plaintiffs’ representative by employees of Stone & Webster as the yard from which lumber would be secured for the construction of the housing project. On November 18, 1943, Mr. Hall, a representative of Stone & Webster, wrote the contractor that the lumber requirements would be withdrawn from Town-
18. The Manhattan District placed its request with the Corps of Engineers who centrally procured lumber. Set forth in the requests would be the quantities, general sizes, and species of lumber. The Corps of Engineers would then place orders for the lumber as requested. However, sometimes the mills became late in their shipment schedules and Stone & Webster Engineering Corporation then was authorized, through their procurement division, to make open market purchases from distribution yards and from retail yards anywhere in the United States from coast to coast. In such case,' a higher rate was paid by the United States, but not by the contractor, than if the lumber was procured from the central lumberyard. In addition to this, the townsite was heavily wooded and Stone & Webster set up a sawmill at which was processed all merchantable timber that was cut from the clearing operations. That lumber was used in the construction of the project. In addition, Stone & Webster had authority to take larger pieces of lumber when necessary and cut them down into smaller sizes when required. For example, 2" x 4"s would sometimes be ripped out of 2" x 8"s. In addition, in the early summer of 1944 an ore dock had been taken down in the Mesabe Kange and it had about 5,000,000 board-feet of lumber in it, big timbers of unusual sizes which were shipped to the project and then cut to usable lengths. It was always hard to get lumber in adequate quantities, but the procurement policies and the organizations in question made it possible within a few hours to get lumber somewhere in the area when urgent. Length was a problem because regardless of how it was ordered the lumber arrived in random lengths. The major part of the lumber procured for the job had a very high moisture con
The 4,242,800 board-feet of lumber handled by plaintiffs in the course of their construction contract was approximately five percent of the total amount of board-feet of lumber handled in the Oak Ridge project during the same period.
The lumberyards at Oak Ridge were probably the largest in the Nation at the time. At one time there were 10,000,000 board-feet of lumber on hand.
Coupe Construction did use Townsite 3 Lumberyard to an extent, but it was necessary for them to procure lumber from other yards in the area also.
The lumber supply was never depleted on the project. There was quite a bit of lumber in the yards at all times. There were times, however, when the needed sizes, shapes and lengths were not present and centers were put up by Stone & Webster for processing lumber into smallér sizes.
The lumber came in varying sizes, necessitating, in some cases, giving a larger length than that requested. However, in this eventuality, a charge was made for the length requested and not for the longer length necessitated by the miscellaneous selection of lumber sizes.
The lumber which was sometimes furnished in lengths longer than that required or ordered by the contractor did not cause any inconvenience or extra effort for the reason that even when lumber came designated at the proper size, it would still be necessary to square the ends by cutting off a small amount. In this operation it would be no more difficult to cut off two feet than two inches. Consequently, the contractor was in no way delayed by having to handle pieces of lumber in lengths slightly in excess of those which were ordered.
Generally, the lumber orders were filled promptly. Only one specific delay was shown which was as long as one day, when it was impossible to get lumber of a tongue and groove variety for roofing. In this case, some square edge lumber was provided.
19. Every effort was made to provide the contractor with lumber under very trying circumstances. The first order
The operation of the lumberyards was so organized that if from a study of the requisitions it appeared to the material man that he was running low on a particular type of lumber, he could order additional supplies from the central lumberyard in order to maintain his supplies. It was requested that orders be sent in ahead of time to facilitate their being filled when the driver arrived with the truck. If it was impossible to fill the order when the driver arrived, he would be given whatever they had in the lumberyard at the particular time.
At all times, if sufficient advanced warning was given of lumber requirements, Townsite Lumberyard No. 3 could cut lumber in order to fill a requisition, if the proper sizes of lumber were not available.
It is a poor construction practice to expect to be able to send a driver down to a yard and immediately come up with the size of lumber required. A good practice requires placing of orders sufficiently in advance to facilitate their being filled on schedule. Sometimes the contractor did this, but at other times trucks were sent down expecting orders to be filled immediately without proper advance warning. This faulty procedure was at times responsible for any delays the contractor had in the receipt of lumber.
20. The contractor never requested permission to set up a central fabricating plant at any of the Government lumberyards. If such permission had been requested it would have been denied because of the practical impossibility of allowing all contractors to fabricate at the lumberyard. The arrangement was that each contractor had his own area in which he could perform fabricating operations if he so desired. As far as setting up a fabricating plant at a contractor’s headquarters was concerned, it would not have been necessary to have permission from anyone to do so. Many contractors did set up fabricating plants at their own areas
No request was made by plaintiffs to set up a central fabricating plant to work the lumber. Nor, during the course of the job, did plaintiffs complain that lumber was not being stored properly for them.
21. After the construction work was completed and on August 31, 1944, plaintiffs submitted to defendant a claim for additional compensation totaling $14,822.18, including four percent for Social Security, etc., ten percent for overhead and ten percent for profit, to cover the increased cost of hauling, handling, removing and replacing the defective lumber and the lumber of improper sizes furnished by defendant. This letter was as follows:
We itemize below our request for additional compensation in the amount of Fourteen Thousand Eight Hundred Twenty-Two Dollars and Eighteen Cents ($14,822.18), for expense incurred in handling inferior grade siding and varying size 2 x 4’s:
1. Increased labor cost for applying 399,988 FBM bevel siding @ $15.00_$5,999.82
2. Carpenter hours required to remove, replace and putty after application 1900 hrs. @ $1.45_ 2,755. 00
3. Haul and distribute 108,622 FBM @ $5.00_ $543.11
4. Clean-up and haul waste 108,622 FBM @ $7.50_ 814.67
5. Resawing 196,000 FBM of 2 x 4’s to uniform width @ $8.50 per M_ 686.00
6. Pick up at saw and distribute 196,000 FBM of 2 x 4’s @ $5.00 per M_ 980. 00
4% Social Security, etc_ 471.14
12,249.74
10% Overhead 1,224.97
13,474.71
10% Profit_ 1,347.47
Total_ 14,822.18
The above expenses were incurred due to the fact that siding supplied was of inferior grade and workmanship, in addition to being very green, causing us to cut out*430 knots, shakes, warps, splits, cups and manufacturing defects, thereby causing us to use 108,622 FBM of additional siding to complete our contract, thus in connection with the above, our lumber allotment should be increased 108,622 FBM of siding at no cost to us.
After the siding was applied and was in apparently acceptable condition, there was buckling, shrinking and cracking causing rejection which forced us to replace the rejected siding. On January 12, 1944, we notified Division No. 4 by memorandum that this condition would arise and we should not be held liable.
As regards the 2 x. 4’s, approximately 75% of all alloted us for construction of our contract was resawn from 2 x 8’s, 2 x 12’s and 4" material, thus we received varying widths causing us to rip them to a uniform width.
Trusting the above will be approved and formal change order forwarded for our signature in the near future, we remain,
Respectfully,
Coupe CONSTRUCTION,
C. W. Mueller /s/
C. W. Mueller,
Project Manager.
On September 30, 1944, change order No. 7 was issued and accepted by plaintiffs without protest. It allowed the claim in the amount requested for culling, sorting and reworking inferior grade lumber furnished by the Government. The lumber allotment was also increased by 108,622 FBM as requested. No appeal was filed from that change order.
22. The record shows that plaintiffs were delayed to an undetermined degree because of the failure of defendant to supply lumber. Lumber was usually available at Oak Ridge for all contractors including plaintiffs. However, it was necessary to fabricate some smaller sizes from the larger pieces at times. Most of such fabrication was done by Stone & Webster upon request of the contractors but some was so reworked by plaintiffs. Change Order No. 7 was allowed as compensation in full for such extra work and for all expenses in connection with it.
23. The unavailability of the proper size, length and kind of lumber for the housing project at all times was not due to any fault and negligence of defendant.
ROADS
25. The roads were not completed in the vicinity of K, L, and N housing area at the time bids were requested in October 1943. Neither were the utilities completed in that area. This was apparent and could be ascertained by inspecting the site. Before entering into the contract the contractor had actual knowledge of these existing conditions.
26. There were heavy rains at Oak Eidge during the winter beginning December 1943, and lasting through April 1944. At times during this period the rains were unusually heavy. During part of this period it was so wet that it was impossible to work on the roads or keep them in good repair.
The main cause of the poor road conditions was the red clay in the general area, which became very slippery when the weather was wet, clinging to the wheels of the trucks and forcing itself in between the dual wheels on the heavier units. When the trucks returned from dirt roads to the gravel and asphalt roads, the red clay was thrown off on to the roads, necessitating removal of the clay. All the contractors in the area, including Coupe Construction, contributed to the general condition of the roads and all suffered the effects thereof.
Stone & Webster had responsibility for maintaining all of the roads in the center of the project and they operated motor patrols (in the lumberyards) and added stone to maintain established roads. Scrapers were used to clean mud off the roads and dump more gravel on to them in order to keep them in usable condition. A constant program was maintained to keep the roads in as good condition as physical conditions would permit.
In accordance with provision 2-07 of the contract specifications, sewers, water lines and house connections were constructed at the same time as were the buildings. Every effort was made through the medium of weekly conferences to prevent the housing contractor and the utility contractor from getting in each other’s way. This was done by meet
The extra costs attributable to bad roads are “a matter purely of opinion.” It is impossible to tell what the contributory damage was. Whatever damage did result was caused by physical conditions in the área, i. e., red clay, hills, and rain, to the operations of the utility contractors installing utilities currently with the housing construction, and to the fact that ail work on roads had not been completed before plaintiffs’ operations.
LABOR
27. After the opening of the bids, plaintiffs’ representatives met with the representatives of the contracting officer. At this conference it was pointed out to Mr. Coupe that under the contract the housing, feeding, recruitment, and transportation of labor was the contractor’s responsibility and Mr. Coupe was specifically asked if he was fully aware of the difficulties in taking care of men and getting men. It was further suggested that he spend some time looking over the job and talking to other contractors on the job in order to satisfy himself that he had enough money in his bid to take care of the situation. Defendant made full disclosure to plaintiffs of all the conditions in the area at the time because of the desire not to take unfair advantage of the contractor and the wish to insure full performance of the contract. Mr. Coupe stated that he would spend whatever time he thought necessary looking over the job and talking to other contractors, particularly with respect to the problems in securing labor and the housing and feeding of labor.
28. Three days later Mr. Coupe had completed his investigation of conditions, particularly labor conditions, in the area by talking with other contractors. On the basis of these discussions with other contractors, plaintiffs concluded that they had not made adequate allowance for hiring, housing, feeding, and transporting labor in their bid and requested permission to increase their bid by $30,000. A letter con
29. Recruitment of labor in the area was under the direction of the War Manpower Commission, Region 7. In order to recruit within any area it was necessary for the local manager to request permission of the state director of the War Manpower Commission to go into that area to recruit labor. Because of the difficulty in securing labor and the multiple recruiting for the same positions at the same time among contractors on the job, an agreement between Stone & Webster Corporation, J. A. Jones Corporation, and Roane-An-derson Company was established to assist all the various contractors, including Coupe Construction, in securing adequate and necessary labor. This recruitment was also done on itineraries from the War Manpower Commission. Under this procedure, laborers were recruited for Coupe Construction who paid all the necessary charges incident to this method of recruitment such as advancing money for meals, etc. The War Manpower Commission declared that some areas were critical areas where recruitment was not allowed. One such area was Louisville, Kentucky. Recruiting of labor for the Oak Ridge project was also done by the carpenters’ unions who sent requests for carpenters all over the country.
30. The labor turnover in the area was very high. The reason for the high turnover was that employment was plentiful all over the country, many of the laborers were not construction laborers to begin with and many came to the area just for the ride. In addition, living conditions were poor at Oak Ridge at that time.' All of these circumstances created a highly competitive market.
31. Coupe Construction was behind in its work and gave as a reason that it needed more labor. When any contractor was in distress in that way, more emphasis was put on his labor recruitment and special assistance was rendered. Consequently, if anything, Coupe Construction was given a better treatment than other contractors. In other respects Coupe Construction was treated the same as were other contractors.
HUTMENTS
32. The housing situation at Oak Eidge was so bad that Stone & Webster and Eoane-Anderson Company were operating an off-area bus system that ranged up to a hundred miles one-way, away from the job to bring in workers. Some contractors operated trucks covered with tarpaulins and with benches in them, for many miles from the job site to enable their workers to commute daily.
33. The Govermnent-owned labor housing hutments were opened up to fixed-price contractors after complaints were received from surrounding communities in regard to sanitation conditions. In the late summer of 1943 there were too many tents and not enough latrines.
The hutments consisted of a 16-foot by 16-foot prefabricated plywood building to which a minimum of five and a maximum of eight men were assigned. There were 10 to 12 such units grouped around a central bathhouse which had toilets and lavatories and gang showers. Also, trailer camps, which the Housing Administration had transferred to the Manhattan District, were grouped around center bath units with 25 to 50 trailers around a unit. The policy was to provide housing for those people who could not be absorbed by surrounding communities. These hutments were built by Government funds under cost-plus-a-fixed-fee-type contracts.
34. Defendant made every effort to advise bidders on contracts at Oak Eidge of the labor situation and suggested that an amount be included in the bid for the purpose of housing, feeding and transporting labor for the project. In the bid form blanks were provided for each bidder to specify the amount included for such purpose. The schedule of prices set out in the contract specified, “The above contract price includes the cost of all housing, feeding, and transportation of labor for the project.” Since Coupe Construction specified no allowance for housing, feeding, and transporting labor in
35. During the summer of 1943 the hutments which had been maintained for employees of cost-plus contractors, were opened up to employees of fixed-price contractors at Oak Ridge. A sui’vey of costs and expenses resulted in fixing hutment fees at 60 cents per night per employee, of which 20 cents would be paid by the employee and 40 cents by the employer. All contractors working on the project were advised of the arrangement at that time. Many of these contractors were still on the project when Coupe Construction arrived oh the scene in November 1943, and were available for advice concerning the labor situation at the time the subject was under discussion with defendant’s representatives by the contractor.
36. The hutments were operated for the Government by Roane-Anderson Company on a cost-plus-a-fixed-fee basis and the hutment charges collected went to the credit of defendant. Any loss due to failure to collect hutment fees was suffered by defendant.
37. In the beginning, Coupe Construction housed its own employees in a camp rented for the purpose from the Tennessee Yalley Authority at Norris, Tennessee. These employees were transported the approximately 15 miles each way from camp to work and return daily. Beginning in late January 1944, the camp became inadequate and some of plaintiffs’ employees were sent to the Government hutments for housing at Oak Ridge. Charges of 40 cents per night
38. The general arrangement for housing the employees of fixed-price contractors in the Government-owned hut-
We further wish to state, we find housing space for 80 men immediately available at Men’s Dormitory and with you supplying housing for the colored labor this will give us ample time to erect additional dormitory space. Temporary cafeteria service is available by John A. Johnson Company, thus we are assured of food and housing for the forces to be placed on the payroll at the start of the project.
39. In order for a contractor’s employees to use the hut-ments for lodging, tickets therefor were issued in blank form to the various construction companies who in turn filled them out and gave them to their men for presentation to the officer in charge of the hutments at the time lodging was sought. A number of these tickets were given to Coupe Construction and issued to their employees over the signature of their timekeeper. These tickets specified the name of the employee and his employer, the employee’s badge number, the period of time for which issued, and contained space at the bottom for checks to show the beginning and ending of the hutment services. On the back the tickets issued instructions to the effect that new tickets must be requested each week, and concerning check out conditions. It also stated, “This ticket is your hutment identification and must be avail-able for checkers at all times.” An employee of a contractor desiring to use the facilities of the hutments could gain admission only upon specific request of his employer and the presentation of such a card. If an employee did gain admittance to the hutments otherwise than by permission of his' employer, he would not have had a bed, blankets, pillow, or
While the record does not disclose any specific instance in which plaintiffs were advised of the financial arrangements concerning the housing of their employees in these hutments, such arrangement was common knowledge and came to their attention after bills were first submitted April 20, 1944. Plaintiffs thereafter participated in the arrangements for the housing of their employees at the Government’s hutment facilities, accepted deductions from their pay estimates for the charges therefor, and even issued checks in payment of bills submitted. No complaints were made concerning such charges until after the services had been rendered and received and all work on the contract completed.
40. From all the proof it is fair to conclude that the hutment services rendered plaintiffs’ employees were at the request of plaintiffs with the knowledge that payment by the employer therefor would be required, at the rate of 40 cents per night per man, and that the services so furnished were upon that understanding.
DAMAGES
41. As a measure of the damages claimed by plaintiffs in this case they rely upon their calculation of the excess cost per thousand board feet for the handling of lumber under this contract, over such cost per thousand board-feet in a previous multiple housing unit construction project. This excess they have figured at $82.70 per thousand board feet, though in arriving at this figure they have assumed without proof that 330,000 board-feet of gypsum sheathing, purchased and installed by themselves involved no increased costs. This excess cost per thousand board-feet they have
Plaintiffs also claim an additional sum for labor recruitment. It is believed that the $30,000 by which plaintiffs were allowed to increase their bid is sufficient to offset such increase.
In addition, plaintiffs claim additional costs occasioned by claimed delay of 80 days, amounting to $483,093 per day, or a total of $38,647.50. It is true that extensions of time totaling 80 days were granted to the plaintiffs, but all such extensions were in connection with change orders accepted by plaintiffs without protest or appeal, and generally embodying an allowance for overhead.
42. The total amount received by plaintiffs for performance under the contract, as amended by change orders and modifications, was $1,831,823.62. The total cost to plaintiffs for performing the contract was $1,906,596.56, thus showing an out-of-pocket loss of $74,772.94.
43. It is not possible to determine the exact reasons for the loss within any reasonable degree of accuracy. Some of this loss was occasioned by plaintiffs’ underestimating the labor situation and underestimating the cost of performance of a housing contract of this kind, a distance away from their home base and during winter weather, which proved to be severe from the standpoint of excessive rainfall. Some of the loss is chargeable to voluntary payment of extra wages to laborers so that laborers drew the wages of semiskilled workmen, and some to the charges for excess lumber because plaintiffs underestimated the requirement. Other excess costs were occasioned by plaintiffs’ unjustified assumptions that a lumber prefabricating plant could be set up at a lumberyard without first verifying the possibility of doing so. Some of the loss was occasioned by plaintiffs’ inability to secure competent personnel and some was due to the fact that certain needed lengths and sizes of lumber to be furnished by the Government were not immediately available. Some extra costs were due to the condition of the roads in the housing construction area resulting from their incomplete state, from the operations of other contractors installing the utilities, and the excessive rainfall. Some additional cost was due to the additional time required for the construction resulting from many reasons, including severe winter weather, inability to
Plaintiffs’ basic cost records such as vouchers, bills, canceled checks, etc., were damaged by rats and were destroyed early in 1952, while this suit was pending but before proof was submitted. The remaining records, including copies of payrolls supplied by defendant, were not kept in a manner to segregate costs of the various phases of the work, such as placing of rough lumber, placing of gypsum siding, placing of the concrete and masonry work, etc. A considerable portion of the work was subcontracted, including certain interior millwork and finishing roofing, some of the hauling, etc. Due to the difficulty in securing labor, plaintiffs classified their common labor in higher categories, such as carpenter tenders, thereby allowing payments of 5 cents per hour extra. This contributed to some of the excess costs. In other classifications of labor, such as foremen and apprentices, labor pushers, essential workers, maids, etc., it was impossible to determine to what phases of the work such were assigned.
Plaintiffs’ additional costs due to the road conditions and for poor and scarce labor cannot be separated from other costs.
44. There was a total of seven bidders on the contract here in issue. These bids in total amounts were as follows:
Name of Bidder Amount of Bid
John W. Ryan Const. Co., Inc_$2,414, 000.00
O’Driscoll & Grove, Inc_ 2,074, 846.95
A. Farnall Blair- 1,999,405. 00
Allan J. Saville, Inc_ 2,473,195.00
Coupe Construction- i, 653,450.00
William A. Berbusse, Jr_ 1, 720,000.00
Foster & Creighton Co_ 2,155,585.00
Total_ 14,490,481.95
The average bid was $2,070,068.85. Plaintiffs’ bid was $1,653,450, or $416,618.85 under the average. Assuming that these bidders each included 10 percent for profit, the average bid, as reduced by 10 percent, was $1,863,061.96. Plaintiffs’ bid as reduced by 10 percent was $1,488,105, or $374,956.96 less than the average bid as reduced by 10 percent. The total
COUNTERCLAIM
45. The hutment charges represented by the 40 cents per man per night charged against the employer and deducted for various monthly pay estimates amounted to a total of $7,662.40. The amount of such charges billed against plaintiffs and paid for by plaintiffs by check amounted to a total of $2,036.80, making a total of $9,699.20. These charges were the subject of one of plaintiff’s appeals to the head of the department from the contracting officer’s decision. The decision of the Army Board of Contract Appeals, representing the head of the department, was to the effect that the contract did not include any provision for housing plaintiffs’ employees for pay from plaintiffs, and that any arrangement therefor would necessarily be outside the terms of plaintiffs’ construction contract. Therefore, it was concluded that the board had no authority to withhold such amounts under the terms of the construction contract. However, in issuing the final settlement voucher in payment for other amounts allowed by the Board of Contract Appeals, the amount of the hutment claim was not included. Defendant is now in possession of the moneys involved in plaintiffs’ claim on the hutment charges which is the same sum involved in defendant’s counterclaim.
The facts concerning the hutment charges are set out above in findings 32 through 40, and are incorporated in these findings on defendant’s counterclaim by reference.
CONCLUSION OE LAW
Upon the foregoing findings of fact, which are made a part of the judgment herein, the court concludes as a matter of law that neither the plaintiff nor the defendant is entitled to recover, and both the petition and the counterclaim are dismissed.
Plaintiffs, operating as a partnership, will be referred to as plaintiff.
The claim for return of charges paid by plaintiff for the housing of its employees by defendant was set out as one of the exceptions to the release.