70 Ct. Cl. 176 | Ct. Cl. | 1930
delivered the opinion of the court:
This case was before this court in 1926. Plaintiff’s petition was dismissed (61 C. Cls. 777). The Supreme Court on December 12, 1927 (275 U. S. 509, 510), reversed our judgment and remanded the case under the following order:
“ This court is of opinion that the Secretary of the Navy had authority to make further contracts to pay the petitioner the increased cost resulting’ from the wage increases put into effect at the Secretary’s instance, in the course of the petitioner’s performance of the original contracts, and that the findings of the Court of Claims show that such further contracts were made and were based upon an adequate consideration, consisting of both advantage to the Government and detriment to the petitioner. The findings on other points are not such as to enable this court finally to dispose of the case. Accordingly the judgment of the Court of Claims is reversed and the cause is remanded to that court with directions (1) to make further findings (a) as to whether the instruments of release express the actual intention of the parties in respect of a settlement or release of the petitioner’s claim for increased cost resulting from putting into effect the increased wages, or whether through mutual mistake, duress, or other sufficient ground for reformation the instruments of release were so drawn and signed that they failed to express the actual intention of the parties in that respect, and (b) as to what amount of increased cost to the petitioner resulted from the wage increases as respects work done under the original contracts after the wage increases took effect; (2) to make these findings from the evidence already taken and any additional evidence which the Court of Claims may deem it proper to receive; (8) to allow any amendments of the pleadings which may be needed to present the question whether the instruments of release should be reformed to express the actual intention of the parties in the particular herein named; and (4) to render such judgment in the cause as may be appropriate in view of the amended pleadings and the supplemented findings.
“The mandate herein shall issue forthwith.”
Subparagraph (a) of the foregoing order of remand is the one now in issue.
The plaintiff, a West Virginia corporation, during the years 1915, 1917, and 1918 entered into eight written contracts to manufacture and deliver to the Government a specified number of torpedoes. The contracts were per
The sole defense to the suit is predicated upon the conclusive and binding effect of seven of the eight releases executed by the plaintiff when it received the final payments of the stipulated contract price. One clause in each of the contracts involved provides as follows:
“ * * * that from the last payment or payments becoming due thereunder there shall be reserved the sum of not less than five thousand dollars ($5,000.00), to be paid after the acceptance of the last lot of material and upon*195 the execution by the party of the first part of a release to the United .States, in such tenor and form as shall be approved by the Secretary of the Navy of claims against the party of the second part arising under or by virtue of said contract * *
.The seven releases relied upon, executed upon different dates, were in part as follows:
“ Now, therefore, in consideration of the premises and of the sum of six thousand five hundred three and 51/100 dollars ($6,503.51) lawful money of the United States, the amount of the final payment due under said contract, being to it in hand paid by the United States, represented by the Chief of the Bureau of Ordnance, the receipt whereof is hereby acknowledged, the E. W. Bliss Company does hereby, for itself, its successors and assigns and legal representatives, remise, release, and forever discharge the United States of and from all manner of debts, dues, sum and sums of money, accounts, reckonings, claims, and demands whatsoever, in law and in equity, for or by reason of or on account of the manufacture and delivery of torpedoes, appurtenances, and spare parts under the contract aforesaid, and does hereby further guarantee to fulfill and comply in all respects with the requirements of paragraph numbered seventy-nine (79) of the specifications annexed to and forming part of said contract.”
The eighth release, given under contract #1228, contained, in addition to the above provisions, the following proviso:
“ Provided, That this release shall not be taken to include claims arising under the said contract other than those which the Secretary of the Navy has jurisdiction to entertain.”
The plaintiff seeks a reformation of the seven releases, predicating its contention upon a mutual understanding and intent of the parties that at the time of their execution the parties did not contemplate or intend them to embrace a settlement of the plaintiff’s claim for extra wages paid its laborers under the department’s orders and contract; that through mutual mistake, as now worded, they do not express their designed and intended purpose, which was to limit the releases to simply a conclusive settlement of all sums, claims, etc., due or which might arise under the express terms of the contracts. It is evident from this as well as other cases of a similar character that the Navy
The first agency established to effect the stabilization of wages of laborers generally was the shipbuilding labor adjustment board created August 20, 1917. On April 8, 1918, the President by proclamation created the National War Labor Board. On June 18, 1918, the War and Navy Departments entered into an agreement with certain employers and employees then engaged in supplying war material and supplies to the Government, by the terms of which harmonious wage1 scales were to be brought about and awards made to effect the same. The plaintiff, while not a party to the above agreement, received notice of the above memorandum award. The plaintiff at this time was experiencing no labor troubles on account of wages, no strike was imminent, and none anticipated. Shortly thereafter, however, on August 23,1918, the plaintiff was advised that it was to put into effect the wage scale approved by the department and present its claim for iñcreased cost of performance. The plaintiff protested against the application of the foregoing order to its plant, pointed out to the department in various written communications and conferences the lack of necessity for adopting the increased wage scale, and finally asserted that, if compelled to adopt it, would assuredly expect reimbursement for the increased
On October 81, 1918, the plaintiff applied to the department for increased compensation and inquired the method of presenting its claim. On December 14, 1918, the Secretary of the Navy appointed a board of three naval officers to consider and pass upon the plaintiff’s claim for increased costs of performance, and this board on July 14,1919 (Finding XII), recommended that the contractual price of each torpedo to be manufactured under existing contracts be
From the record it seems certain that both the contractors and the officials of the department in direct contact and charge of plaintiff’s claims and relationships with the same treated the question of the payment to the plaintiff of the amount of thé board’s award in precisely the same way and manner as any other solitary and single claim would have been treated.
The course of proceedings narrated above in detail clearly demonstrates that what was pending was the right to pay an allowed award, one arising in due course of administration, and attributable to the war conditions. Settlement of this claim was in fieri; the facts had been found, the award made, but payment was suspended awaiting decision of the courts. Under these circumstances there existed no reason for exacting a release or receipt from the plaintiff with respect to the claim. The department could not pay it, and the plaintiff’s only remedy was to resort to the courts. No room for a compromise prevailed, and in so far as the department was concerned, its resources had been exhausted and proceedings ended. The releases relied upon as including settlement of this claim were executed on various dates between June 6, 1919, and July 19, 1922, an extended period of over three years.
The eight torpedo contracts involved a total expenditure • of thirty-five million dollars. Each contract by its express
The defendant makes no serious defense as to liability under release #1223, and the reason for excepting release #1223 and awarding judgment under a pro rata basis is not apparent when the wage scale applied generally to the performance of all the contracts involved and the amount of the award is conceded to be correct. In the case of Fire Insurance Association v. Wickham, 141 U. S. 564, 580, 581, the Supreme Court said:
“Aside from this, however, the circumstances attending the execution of a receipt in full of all demands may be given in evidence to show that by mistake it was made to express more than intended, and that the creditor had in fact claims that were not included. Thus in Simons v. Johnson, 3 B. & Ad. 175, which was an action of covenant, defendant pleaded a release, which recited that various' disputes were existing, between the parties, and that actions had been brought against each other which were still pending, but that it had been agreed between them that, in order to put an end thereto, the defendant should pay the plaintiff £150, and that each should release the other from all actions, causes of action and claims brought by him, or which he had against the other, and the instrument then proceeded to release £ all claims, demands, actions whatsoever.’ It was held that parol evidence was admissible to show that the claim upon the covenant was not intended to be included in the release, Littledale, J., saying: ‘ There can be no doubt that the matter contemplated in this release was the actions there referred to, and parol evidence was admissible to show that the subject matter of the present action was not involved in them.’ ”
Gem Hammock Co. v. United States, 60 C. Cls. 262. In the case of United States Cartridge Co. v. United States, 62 C. Cls. 214, 230, 231, this court held, in a situation similar to the present case, as follows:
“ There is only one other question presented with reference to this item and that is predicated on the fact that*202 upon two items of an entirely different nature the plaintiff had filed a claim with the Boston District Claims Board which had finally been allowed in the sum of $6,571.44, of which allowance the plaintiff was informed, and upon payment of which it was required to sign a release. These two items were the only items involved in that claim, but in the preparation of a release to be signed a form was used which contained a general release of all claims under the contract. At this time the claim for additional labor costs already referred to was pending before another board and was being vigorously prosecuted, and there was no conception apparently upon the part ox anyone having to do with these transactions that the two claims had any relation to each other or that the execution of the release in connection with the claim allowed for $6,577.44 in any manner affected the rights of the plaintiff as to its claim for increased labor cost. It is so apparent that this release then signed was not intended to have any effect upon the pending claim for increased labor costs that there could be no justification for giving it any such application at this time.”
This court may reform a contract. Ackerlind v. United States, 240 U. S. 531. The case of United States v. William Cramp & Sons, 206 U. S. 118, is not, we think, applicable. In the Gramf case the suit was to recover for delays attributable to the Government in the way of failure of the Government to deliver to the plaintiff armor plate in the order and .at the times needed to complete the work, an obligation the Government assumed in the contract and did not perform. When the time for settlement arrived a complete and conclusive release executed in conformity with the provisions of the contract obviously precluded the plaintiff from recovering for a breach of the contract. What we have said as to independency of the two transactions involved herein expresses our view. In the Cramp case (supra) the settlement involved the contract and it alone.
Judgment for plaintiff for $715,200. It is so ordered.