Case ID: us-ct-cl_38/html/0536-01.html
Source: Caselaw Access Project
Author: {"author": "\n      Wright, J.,", "license": "Public Domain", "url": "https://static.case.law/"}
Date Created: 2024-08-24T03:29:51.129683

ERNEST J. COTTON ET AL. v. THE UNITED STATES.
    [No. 22783.
    Decided April 13, 1903.]
    
      On the Proofs.
    
    This action is upon a contract for the building of wharves at Honolulu. Damages are claimed for an item of work required by the specifications, but intended by both parties to be erased; for extra piling rendered necessary by the manner in which another contractor of the defendants dredged the place where the piling was to be put; for delay caused by the negligence and delay of the other contractor to prepare the site where the work was to be done.
    I. Where an item in the printed specifications was to be omitted and was not estimated for by the contractor, but was inadvertently carried out by his workmen, he can not recover, though it remained unerased in the specifications.
    II. A specification which says that “in measuring quantity, excavation below 88.5 feet and beyond slopes of 4 vertical to 1 horizontal will not be paid for,” can not be construed as a warranty that in no event need the excavation exceed those limits.
    
      III. Where a contractor sustains damages caused by the unreasonable delay of another contractor of the defendants to prepare the ground by dredging upon which he is to erect a wharf, he is entitled to recover.
    IV. The measure of damages in such a case will be the value of the services of his employees and machinery during the period of delay, diminished by compensation actually received for their services from other Sources.
    
      The Reporten? statement of the case:
    The following are the facts of the case as found by the court:
    I. The claimants herein, Ernest J. Cotton, Charles E. Cotton, and James B. Agassiz, are citizens of the United States and of the State of California, and are partners engaged in a general contracting business under the firm name of Cotton Brothers & Co.
    II. On March 22, 1899, the said firm entered into a contract with the United States, as follows:
    “This contract, of two parts, made and concluded this twenty-second day of March, A. D..1899, by and between Cotton Brothers & Company, of the city of Oakland, county of Alameda, State of California, a firm consisting of E. J. Cotton, C. E. Cotton, and James B. Agassiz, as principal, and The United States Fidelity and Guarantee Company of Baltimore, Maryland, as surety, parties of the first part, and the United States, by 11. B. Bradford (Chief of the Bureau of Equipment), acting under the direction of the Secretary of the Navy, part}'' of. the second part, witnesseth, that for and in consideration of the payments hereinafter specified, the parties of the first part, for themselves and their personal and legal representatives, do hereby covenant find agree, to and with the party of the second part, as follows, viz:
    “That they, the said parties of the first part, will provide, furnish, and deliver, at their own risk and expense, at such place or places at the harbor of Honolulu, Hawaiian Islands, beginning and within thirty (30) days from the date of this contract, all the necessary materials and labor, tools, and appliances for the construction and completion, in all respects, of two (2) wharves, and will complete the construction of the same in twelve (12) calendar months from the date of signing the contract, in strict accordance with, and subject to, all the conditions and requirements of the plans and specifications appended hereto, and which form a part of this contract, for the sum of forty-nine thousand nine hundred dollars ($49,900).
    
      ‘/It is hereby mutually and expressly covenanted and agreed, and this contract is upon the express condition, that no Member of or ’Delegate to Congress, nor any officer of the United States, naval, military, or civil, is, or shall be, admitted to any share or part of this contract or to ány benefit to arise therefrom; that any transfer of this contract, or of any interest therein, to any other person or party than said parties of the first part shall annul this contract, so far as the United States are concerned; and that if said parties of the first part shall fail in any respect to perform this contract on their part, it may, at the option of the United States, be declared null and void, without prejudice to the right of the United States to recover for defaults herein or violations hereof; and that for such default the United States may demand and recover of said parties of the first part, and their representatives aforesaid, as liquidated damages, a sum of money equal to the penalty of the bond forming part of this contract.
    “And it is further agreed hj the parties of the first part that they will protect and defend the party of the second part in the full and free use and enjoyment of any and all patent rights to any invention, machine, or device which may be applied as a part of the work herein specified and contracted for, either in its construction or use after completion, against the demands of all persons whomsoever.
    “And it is further agreed that if, during the progress of the work, it shall be deemed by the Government necessary or desirable to make any changes or modifications in the plans and specifications affecting the cost, said changes or modifications and the increased or diminished compensation to be paid the contractor, must be agreed to in writing by the parties to the contract.
    “And this contract further witnesseth, that the United States, party of the second part, in consideration of the foregoing stipulation, does hereby covenant and agree, to and with the parties of the first part and their said representatives, as follows, viz:
    “That for and in consideration of the faithful performance of this contract by the parties of the first part, duly certified to by the inspecting officer appointed for that purpose by the Secretary of the Navy, and the acceptance of the work as satisfactory on the part of the United States, there shall be paid to the said parties of the first part, for the full and entire completion of the said two wharves the sum of forty-nine thousand nine hundred dollars ($49,900.00), upon approved bills properly certified and drawn in the usual manner, and payable at such navjr pay office as the parties of the first part may elect, within ten days after warrants for the same shall have been passed by the Secretary of the Treasury, and in the manner specified in paragraph forty-one (41), page four (i), of the specifications.
    £ 4 It is mutually understood and agreed, as aforesaid, that no payment or .allowance to said parties of the first part will or shall be made bjr the United States, for, or on account of, this contract, except those payments herein specified; that ten per cent will be withheld from the amount of each payment herein stipulated, as security for the full completion and performance of their covenants and agreements by the said parties of the first part; and that ninety per cent oí each of said payments shall be made within ten days after a warrant therefor shall have been passed by the Secretary of the Treasury.
    “ In witness whereof the said parties hereto have hereunto set their hands and seals at Oakland, California, this twenty-second day of March, A. D. 1899.
    “The following change was made in the specifications before signing, and was well understood: Second (2nd) clause, paragraph seventeen (17), page two (2), of specifications, ‘about four’ changed to ‘two (2),’ so that it shall react ‘ spaced two (2) feet center to center. ’
    “Cotton Bros. & Co., [l. s.]
    “ By C. E. Cotton, [l. s.]
    ‘ ‘ Member of Firm.
    
    “R. B. Bradford, [l. s.]
    “ Ghief of Bureau of Fqidpment.
    
    “Signed and sealed in presence of—
    “Hubert C. WtcKoef.
    “A. E. Bolton.
    “ Note. — The bondsmen must not sign the contract.
    “Witness as to R. B. Bradford:
    “F. A. Wilson.
    
      “Plans a/nd sj/eoification*.
    
    “Plans axd Specifications — Proposal and Contract for the Construction of Wharves and Excavation of Slips at Honolulu, Hawaiian Islands — Navy Department, Bureau of Equipment.
    “Proposals — Construction of Wharves and Excavation of Slips, etc., at Coaling Station, Honolulu, Hawaiian Islands. — Sealed proposals, in duplicate, indorsed ‘Proposals for the construction of wharves and the excavation of slips in the harbor of Honolulu, Hawaiian Islands,’ will be received at the Bureau of Equipment, Navy Department, Washington, D. C., until 12 o’clock noon on Friday, January 20, 1899, and publicly opened immediately thereafter, for the construction of wharves and excavation of slips, etc., at Honolulu, Hawaiian Islands. Plans, specifications, and blank forms of proposals will be forwarded upon application to the Bureau, where further information may be obtained. The right is reserved to reject any or all bids, and to waive any defects. - - R. B. Beadford, Oh,uf of Bureau. 12-5-98.
    “SPECIFICATIONS FOR DREDGING TWO SLIPS AND THE CONSTRUCTION OF TWO WHARVES AT THE UNITED STATES NAVAL COALING STATION, HONOLULU, HAWAIIAN ISLANDS.
    “1. General description. — The water front of Honolulu between the Pacific Mail Steamship Company’s wharf and the Bishop estate shall be improved by the construction of two slips, each 140 feet wide, and of two wharves, all of the form and dimensions shown on the plans.
    “2. Drawings.- — They comprise a plan of the United States naval coaling’ station, including the wharves and slips, and a sheet of cross sections of the slips. The limits may be changed by the Government.
    “3. Quantity of dredging. — The amount of material to bo removed is estimated at about 82,000 cubic yards. This quantity is approximated onty, and may be increased or diminished as the funds allotted for the work may allow or require.
    “ 4. Dredging. — The whole area of each slip-bounded by the lines shown on the plan shall be dredged to a depth of 28 feet below mean low water. The sides of the dredged area shall be finished vertical if the material will stand. In measuring quantity, excavation below 28.5 feet and beyond slopes of 4 vertical to 1 horizontal will be deducted and not paid for. Shoals, lumps, or ridges left behind the dredge must be removed.'
    “5. Material. — The material to be dredged is believed to consist of about 20,000 cubic yards of soft coral and gravel to a depth of about 14 feet, overlaying about 72,000 cubic yards of hard coral which will require blasting. Each bidder, however, is expected to examine and inform himself fully on all matters relating to the character of,the work required by visiting the station and examining the site of the proposed work and plans.
    “6. Deposit. — The material dredged shall be deposited on the station and surrounding streets and lands within 800 feet of the head of slip No. 1, at points to be designated by the officer in charge, the Government reserving the right to'have an}^ or all material sent away from the station, for which a separate price is to be stated, as required in paragraph 42. Material deposited, on the station, streets, and lands within the above limits shall be leveled and graded by the contractor. The contractor will be required to retain the material deposited upon the station within the areas prescribed, bj^ embankments or other means approved by the engineer in charge of the work for the Government, all at his own expense. In no case shall any material be deposited where it will injuriously affect the channel in front of or leading to the station or any part of the harbor of Honolulu.
    “7. Maries, etc. — The lines of the area to be dredged will bo given by the officer in charge. The', con tractor will furnish all marks and tide gauges at his own expense and maintain the same in good order.
    “ 8. Limits of dredging. — Any dredging done outside of limits specified will not be paid for.
    “ 9. Measurements. — All materials excavated from the slips will be measured in the cut, ,and separate and distinct areas must be set apart in the slips for such operations for measurement before, during, and after the work. The decision of the civil engineer as to the amount of material dredged shall be final. Ho material to be deposited upon lands in the immediate vicinity of the station without the written authority of the civil engineer in charge.
    “10. Labor and material. — The contractor shall furnish all labor and all appliances of every description adequate and necessary to the proper execution of his contract.
    -X- * * *• *
    “31. Damages for delay. — In case the completion of the work shall be delajmd beyond the period fixed upon for the completion of the contract, deductions of $50 per day during such delay may, in the discretion of the Secretary of the Navy, be made from the contract price of said work as liquidated damages. * * *”
    All, other sections of specifications are omitted as immaterial.
    The said claimants performed the said contract in complete accordance with the said plans and specifications, except that, owing to causes hereinafter set forth, they were unable to complete the wharves within the period specified in the contract. The said period was extended by the proper officers of the Navy Department to December 22,1900, and the wharves were completed upon said date. Claimants’ work was accepted by the Government and they were paid the contract price for the work included in, and provided for by, their said contract, without prejudice to this suit.
    
      III. In the course of claimants’ execution of their contract hereinbefore mentioned they constructed certain waling, to the length of 290 feet, upon one of the wharves provided for in the said contract. The said waling was originally required by the specifications, but had been expressty excluded from, the contract bjr the proper officers of the Navy Department before the contract was signed, but the claimant failed to notify the workmen of the fact.
    ' IV. The contractor doing the dredging did it so that a large area under the proposed wharves contracted by the claimants to be built, and being a part of the sites of the said wharves, was excavated and dredged to a great depth, whereby the water under the said wharves was made much deeper than it was when the claimants entered into their said contract, but it does not appear to the satisfaction of the court that the excess of dredging could have been avoided by ordinary care. There were better machines than the one used, the use of which would have greatly lessened delay, but the machine, in fact, used was of the kind frequently or commonly used by ordinarily careful contractors in such work. In consequence of/such excessive dredging, the claimants, in order to erect the said wharves according to the terms and requirements of their said contract, were obliged to procure and use a large number of longer piles; and the claimants were obliged to use in the sheathing of the said piles as required by their said contract a large quantity of sheathing material in excess of the quantity estimated by them in bidding. The reasonable value of the additional sheathing material so made necessary, and used by the claimants, is $2,531.28. ■
    V. It was also provided and agreed that certain dredging mentioned in the preceding finding, and for which the contract was awarded to another party as therein stated, was to be done before the building of the wharves. The said other party was negligent, dilatory, and remiss in the performance of the dredging, and failed to complete his contract until on or about the 25th day of October, 1900. For this delay the said contractor was fined )jy the Navy Department in the sum of $10,150; and the claimants were, on account thereof, granted an extension of time to and including December 22, 1900, as hereinabove in the second of these findings stated. By reason of the said delay of the said dredging- contractor the claimants were unable to complete their work before the 22d dajr of December, 1900, being for the greater part of the. time greatly embarrassed, hindered, and delajmd in the performance of their contract by the fact that the dredging-operations, in progress beyond the period limited for that work, did not permit the claimants free access to and use of the ground, and made it impossible for them to do their work as rapidly and conveniently as otherwise they would have done. In consequence whereof, the claimants, having begun the performance of their contract in due season, at the time fixed by the proper officers of the United States, and in obedience to the requirement of the said officers, were delayed and detained' in the performance of their contract for a period of ninety-four working days.
    By reason of- the said delay the claimants were damaged, and were put to loss and expense on account of their machinery, wages, and detention from other work, to the amount of $2,914.
    YI. In consequence of the delay mentioned in the foregoing finding, the claimants, having contracted with a- certain firm of Vincent & Belser for the laying of certain bitumen on the said wharves, the doing of which work was a part of the claimants’ contract with the United States, became liable to' the said Vincent & Belser in the sum of $1,179 in excess of the contract price agreed upon between the claimants and the said firm, for detention of the machinery and employees of the said firm beyond the period within which the said firm could and would have done their work had the United States completed the dredging above mentioned in due season, according to the terms of the contract between the United States and the claimants.
    
      Mr. Ohcorles A. Keigwin for the claimant. Mr. William B. MattJiews was on the brief.
    
      Mr. James A. Tanner (with whom was Mr. Assistant Attorney- General JPraclt) for the defendants.
   Wright, J.,

delivered the opinion of the court.

By contract of the parties, executed March 2, 1899, plaintiffs undertook to provide, furnish, and deliver at their own risk and expense, at the harbor of Honolulu, Hawaiian islands, beginning and within thirty days from the date of the contract, all the necessary materials and labor, tools, and appliances for the construction and completion, in all respects, of two wharves, and to complete the same in twelve calendar months from the date of the signing the contract, in strict accordance with, and subject to, all the conditions and requirements of the plans and specifications appended to and made a part of the contract, for the sum of $49,900.

Previous to the making of the contract notice or request for proposals for the wharves referred to in the contract, and the excavation of slips for same, had been issued by the Bureau of Equipment, Navy Department, Washington, such proposals to be based upon the plans and specifications which are now attached to the contract. The contract for the dredging was separately let to Buckman & Campbell, and because the wharves could not be built until the dredging was sufficiently advanced to enable the work to proceed, nothing could be clone within thirty days, as provided in the contract, and this time limit was disregarded -by the parties, and the time for the completion of the work was from time to time extended, and the wharves were not finished until December, 1900, a delay of more than eight months beyond the time stipulated, caused, as it is contended, bj^ the.fault of the dredging contractors in failing to do that work in time, and for which the defendants’ officers under the terms of the contract with the dredgers penalized them for such delay in the sum of $16,150.

Petitioners completed the work required of them by the contract and were paid in full by the defendant without prejudice to the claims for which thejr seek to recover in the present suit, which latter, as described in the petition, consist of damages on account of delays and interruptions due to the failure of the defendants to complete the necessary dredging and other preliminary work, in consequence of which they were compelled “to retain their machinery idle, and employees unemployed at Honolulu, all at a loss, for a great part of one Hundred and eighty-eight working days, to wit, for at least one-half of that period of time, and to pay the said employees full wages for the said number of days, whether employed or idle, and to sustain the loss from idleness of said machinery, altogether at a cost to petitioners of $11,440.’’ A further item, of loss, by reason of the delay of the dredge work, consists of $1,179 petitioners paid to their subcontractors, Vincent & Belser, for laying the bitumen required by the contract, the said subcontractors having been delayed in their work, bj’ reason of the fault of the dredgers, one hundred and thirty-six working dajrs, at a cost of the sum before mentioned. The petition also claims for extra work of waling $77.80, and for labor and expense beyond the scope of the contract to the amount of $2,531.28. The latter item is claimed for the reason, as alleged, that the dredgers excavated beneath the wharves to a much greater depth than the specifications for the dredging required, upon which latter alone petitioners based their bid for the superstructure, and in consequence of such greater depth longer piles were required, exposing greater length of surface to be sheathed with yellow metal, increasing the expense of the metal over that required bj^ the contract $2,531.28.

As regards the item of waling, the specifications require it, but it is not disputed it was directed to be omitted by the officer in charge, and was not estimated by petitioners in their bid for the work, but by some inadvertence the specification was left unchanged in that respect, and the wale was put on by plaintiffs’ workmen because of the neglect of information that it was to be omitted. This item, therefore, resulted from petitioners’ own inattention, and for such reason they can not recover.

The item for the expense of additional sheathing is based upon the fourth specification, entitled “Dredging,’’ which provides that the whole area of each slip bounded by the lines shown on the plan shall be dredged to a depth of 28 feet below mean low water. The sides of the dredged area shall be finished vertical if the material will stand. In measuring-quantity, excavation below 28.5 feet and 'beyond slopes of 4 vertical to 1 horizontal will be deducted and not paid for. It is plaintiffs’ insistence that in estimating for length of piles and sheathing they construed this specification to mean there would be no excavation beyond slopes of 4 vertical to 1 horizontal. This may be true, yet the specification can not, we think, be construed as a guaranty by the defendant that in no event would the excavation exceed that limit, for it merely provides that no payment should be made for such excess, should it occur. In contemplation of the parties, what event would likely happen to cause an excess beyond the limit of the specification ? The event is portrayed by the expression, “if the material will stand,” and this quality of the bottom was equally open to investigation by both parties, and plaintiff therefore took the chances of that which probably happened — the caving of the slopes to some extent, thereby enlarging the excavation beneath the wharves, creating the requirement for greater length of piles and sheathing. It is true petitioners contend that the extra excavation was occasioned by the neglect or incompetence of the dredge workers, but we are indisposed to assume that they would take upon themselves a greater burden than was necessary, and it is hard to imagine that neglect or incompetence, if it in fact existed, would lead to unnecessary excavations beyond the confines of the lines marked out upon the plans. It does not appear to our satisfaction that the excess of excavation could have been avoided by ordinary care. The more natural and reasonable inference from the whole evidence, if inferences are to be indulged, is that the banks would not stand on the specified slope, and the material slipped to the bottom, from whence it was taken. If-we are correct in this reasoning, the burden of the expense of additional length of piles and sheathing made necessary by excessive excavation was assumed by plaintiffs under the terms of their contract, and for this item they can not recover.

That there -was delay in the dredge work that prevented plaintiffs from completing the wharves is beyond dispute. That it was unreasonable delay by the dredge contractors is evidenced by the fact that the defendant deducted from their pay upon the contract $16,150. That plaintiffs were not at fault in the delay of the completion of the wharves is evidenced by the fact that defendant extended from time to time the time of such completion, and when that was accomplished paid them in full, without deduction, the contract price, and this, too, without prejudice to this suit. In truth, from a consideration of the whole evidence it is indisputable that the reasons for the delay put upon plaintiffs was well understood during the time of its occurrence and duration, and the officers of the defendant did all they could to lessen the worst effects of it. Part of the time covered by the delay so occasioned plaintiffs obtained and performed other work and received compensation therefor, and a portion of the time of their employees was also covered by employment, at less wages, however, than plaintiffs were obliged to pay them. Upon the findings we feel warranted in the conclusion that justice requires that defendant compensate the plaintiffs for the reasonable damages the latter have sustained in consequence of the delay in the prosecution of their work, caused by defendant’s dredge contractors’ failure to diligently prosecute their work. The right of this conclusion, it seems to to us, is made more manifest by the fact that defendant has indemnified itself by deductions from the pay of the dredge contractors.

The measure of the damages to plaintiffs should be the actual and direct loss to them occasioned by the delay, as near as it- can be ascertained, not remote or speculative damages that would not have been anticipated by the parties upon the happening of the events that caused the dela,y. Without discussing the various elements in plaintiffs’ contention, composing these damages, we think it is a sufficient statement of the proper rule to be applied that the plaintiffs are entitled to receive the value of the services of their employees and machinery during the time of the delay in the business in which they were then engaged, diminished by compensation actually received by them for other services performed during the same period. It is not without difficulty that this amount can, from the evidence, be ascertained. We have, however, the basis of the petition to start with, which gives ninety-four working days for the period of ioss for idle machinery and unemployed employees. Upon the whole evidence this number of days is, we think, clearly proved. In the cross-examination of one of the claimants he fixed the value of the machinery at $19 per day and the wages of the crew of six men at $21 per day, a total of $40 per dajr, which we consider reasonable, except the value of the use of the machinery, which we reduced to $10 per day. This would give $2,914 for this item, for which we think claimants are entitled to recover. The subcontractors for laying the bitumen were delayed by the same causes, for which plaintiffs paid $1,179, and from all the evidence in the case, upon which our findings are based, we are convinced this sum did not exceed the actual damage the subcontractors sustained; It is our conclusion that plaintiffs are entitled to a judgment for $4,093, and it will be entered against the defendant accordingly.