Case ID: us-ct-cl_47/html/0167-01.html
Source: Caselaw Access Project
Author: {"author": "Atkinson, J.,", "license": "Public Domain", "url": "https://static.case.law/"}
Date Created: 2024-08-24T03:29:51.129683

ALBERT H. GILLESPIE v. THE UNITED STATES.
    [No. 30777.
    Decided January 8, 1912.]
    
      On the Proofs.
    
    The claimant enters into an agreement to furnish teams to work for the Mississippi River Commission. He from time to time presents 158 teams for inspection, 64 of which are accepted and put to work under the agreement. Subsequently and without previous notice, the engineer officer in charge writes to the contractor “ that because of failure to comply with specifications for furnishing wagons, teams, anti equipments, the agreement dated May 20, 1010, is hereby canceled."
    
    L When the only power to annul a contract is, according to its terms, when the contractor fails to furnish the necessary number of teams, and then only after reasonable notice, the engineer officer in charge can not arbitrarily annul a contract without notice.
    II. The fact that teams were inspected, approved, and used, and were in the service of the Government is a strong reason why reasonable notice in writing should have been given to the contractor as to the alleged insufficiency of his service, so as to enable him to supply additional teams if necessary.
    III. Where there is no forfeiture clause in a contract it can not be revoked by a mere notice of cancellation.
    IY. The measure of damages in such a ease is the difference between the actual cost of the teams to the contractor and the price fixed in the agreement, subject to a reasonable deduction under the rule in Speed's ease. (2 C. Ols. R., 429; 8 Wall. R„ 77.)
    Y. In such a case the contractor can not claim the profits of a commissary business which was not a subject of the contract and had no connection with the execution of the work.
    
      The Reporters’ statement of the case:
    (Note that on a motion for a new trial (post) it is held that no valid contract existed in this case and that an action can not be maintained against the Government.)
    The following are the facts of the case as found by the court:
    I. The claimant herein is a citizen and resident of the State of Louisiana, town of Vidalia, and parish of Concordia.
    
      II. On the 20th day of May, 1910, he made and entered into an agreement with the United States to furnish teams for hauling willow brush between Natchez and Vicksburg, Miss., from June 15, 1910, to March 1, 1911, according to certain specifications, the advertisement for such work, specifications, proposal, and acceptance, which are attached to ajad made a part of the petition.
    III. The first call made by the Government under said contract' was for 20 teams; claimant furnished at this time 32 teams, of which 20 were accepted by the Government and put to work under said contract; and said 20 teams were continuously used under said contract until October 14,1910.
    IV. From time to time and until October 14, 1910, claimant had furnished 158 teams for the inspection of and acceptance by the agents and officers of the Government, of which 64 were accepted by the Government and put to work under said agreement of May 20, 1910, and for which service and work the Government paid claimant up to and including October 13, 1910.
    V. Many of these same teams so accepted and put to work by the Government under said agreement had performed similar work for it prior to working for claimant under said agreement.
    VI. On or about the 14th day of October, 1910, the United States caused the following written notice to be delivered to claimant:
    “ Mississippi Eivee Commission,
    “ Fourth District,
    “ 3338 St. Charles Avenue,
    
      “New Orleans, La.
    
    
      “ Mr. A. H. Gillespie, Viddlia, La.
    
    “ Dear Sir : You are hereby notified that because of failure to comply with specifications for furnishing wagons, teams, and equipment for hauling willow brush, that the agreement dated May 20, 1910, is hereby canceled to date from October 14, 1910.
    “ You will govern yourself accordingly.
    “ Very respectfully,
    “ Bobert B. Balston,
    “ Captain, Corps of Engineers, U. S. Army?'
    
    VII. Claimant did not give his consent to the cancellation of said agreement.
    
      VIII. Up to October 14, 1910, when the United States served notice of the cancellation of said agreement, the teams furnished by claimant and accepted by the agents and officers of the United States, had worked thereunder 2,369|- days all told, at $3.38 per day, for which he has received from the United States the sum of $8,008.07.
    IX. After October 14, 1910, the date of the cancellation of said agreement by the United States, it required the services of teams furnished by other parties 3,429f days in order to do the work provided for under claimant’s agreement with the United States.
    X. The 64 teams so furnished by claimant, and accepted by the officers and agents of the United States, were at work under said agreement at the time of its cancellation, including the wagons, harness, and equipment.
    XI. Many of the teams furnished by other parties after October 14, 1910, to perform the work covered by claimant’s agreement with the United States, were the same teams furnished by him and at work under his agreement at the time of its cancellation.
    XII. The officers and agents of the United States before October 14, 1910, never objected to the character of wagons, live stock, drivers, and harness constituting said 64 teams, except at the outset of the work; and the United States, nor its officers or agents, between May 20, 1910, and October 14, 1910, never notified claimant that he had failed to supply the number of wagons, teams, drivers, and equipment necessary to perform said work, and on that account it would hire such additional wagons, teams, drivers, and equipment as might be necessary to perform said work, and that it would deduct, whatever additional cost, over the contract price, there might be due claimant under his said agreement.
    XIII. Claimant at all times endeavored faithfully to comply with all the terms, conditions, and specifications contained in his said agreement with the United States to furnish all wagons, teams, harness, and drivers called for under; said agreement; was ready and willing at all times to faithfully perform it; and was financially able to perform it. .
    XIV. Of the 64 teams at work under said agreement at the time of its cancellation, 14 were owned individually by claimant, the remaining 60 teams being hired by him from other ,parties, for which he paid $2.75 per day each, while his own teams’ cost for driver and feed would be $2.25 per day; the profit he should be paid, therefore, for his own and the hired teams would be $3,035.58.
    XY. Claimant operated a commissary in connection with said work from which he provided supplies for men and teams, and in addition to the men and teams in his employ furnished supplies to from 150 to 200 men in the employ of the United States in the vicinity of said commissary; he carried a stock of goods in said commissary of the value of from $600 to $1,000 at all times, and replenished said stock two or three times during each week, from which the gross receipts amounted to from $1,500 to $2,000 per month, which was a profitable business to claimant.
    XYI. Contractors doing work of this kind sometimes run commissaries in connection therewith, and the profit to be made therefrom is one of the inducements that follows the contracting business; and after the cancellation of said agreement on May 20, 1910, claimant had to sacrifice said commissary, as well as his camping tents and outfit.
    XVII. By reason of the cancellation by the United States of claimant’s said agreement of May 20, 1910, he lost from $500 to $600 per month profit on his said commissary business ; and in the disposal of the stock of goods which he carried from time to time in said commissary, and his other outfit, he lost $1,000 more, aggregating a loss of about $5,000 to $6,000. ■
    XVIII. Claimant is the sole owner of said claim; that no other action has been taken thereon either in Congress or by and before any of the departments; and no assignment of said claim, or any part thereof, or interest therein, has been made by him.
    
      Mr. Waitman H. Gonnaway for the claimant.
    
      Mr. W. W. Scott (with whom was Mr. Assistant Attorney General Thompson) for the defendants.
   Atkinson, J.,

delivered the opinion of the court:

Plaintiff brings this suit to recover the sum of $18,000, based upon the canceling of an agreement made and entered into May 2, 1910, between himself and the United States, for the furnishing of teams to haul willow brush to be used by the defendants in the improvement of the Mississippi Fiver, covering the period from June 5, 1910, to March 1, 1911. Under an advertisement issued by the Engineer’s Department for bids for said purpose, plaintiff was awarded the contract at the rate of $3.38 for each two-horse or two-mule team per day during said period.

Section 1 of the published specifications (which are made a part of plaintiff’s petition) estimated that not fewer than 20 or more than 50 teams would be required, and that the length of the haul and the condition of the roads would have to be considered to determine the necessary number. Twenty teams were accepted out of 32 furnished at the beginning of the service as conforming to the requirements of the specifications as to strength and efficiency and were put to work under the contract. From time to time thereafter the number of teams was increased to 84, which were accepted and approved by the agents of the Government, and were continuously employed until October 14, 1910, when plaintiff was ordered by the engineer in charge to discontinue further operations under his contract, assigning as a reason therefor failure to comply with the specifications therein.

Section 7 of the specifications under which plaintiff’s 6id was accepted is in the words following:

“In case the contractor fails to supply the number of wagons, teams, and necessary equipment required for the successful and economical prosecution of the work, then the United States will have “the right to hire such additional wagons, teams, drivers, and equipment as may be necessary, and to deduct whatever additional cost over the contract price there may be from any amount due the contractor.”

Nowhere in the specifications is it provided that the defendants shall have the authority to cancel or annul the agreement or contract. Only when the contractor fails to furnish the necessary number of teams provided by the agreement could they act, and then only after giving the contractor reasonable notice (no specified time being mentioned in the specifications) could they proceed under section 7, supra, to hire such additional wagons, teams, etc., necessary to complete the work, and charge the additional cost, if any, to the contractor. The fact that the teams were inspected, approved, and used by the agents of the defendants is a still stronger reason why reasonable notice in writing should have been given to plaintiff as to the alleged insufficiency of his service, thus to enable him to supply additional teams, if it was necessary so to do, before they were employed by the defendants at plaintiff’s expense to carry out the provisions of the agreement. There being no forfeiture clause in the agreement, it could not be revoked by a mere notice of cancellation on the part of either party thereto.

The remaining question in the case is the amount of damages plaintiff should be awarded for the breach of the agreement by the defendants. The measure of damages is the difference between the actual cost of the teams to plaintiff and the price fixed in the agreement that he was to be paid per day for each team furnished by him which had been approved and accepted bjr the agents of the defendants, “ making a reasonable deduction for the loss of time, trouble, risk, and responsibility attending the full execution of the contract.” (Speed v. United States, 18 Wall., 77.)

The exact cost of executing the work is not clearly shown by the evidence. It is shown by the findings, however, that it would have reasonably cost plaintiff $2.25 per day for the maintenance of each of the 14 teams that he personally owned, which would leave him a profit of $1.18 on each team per day. After the annulment of the contract by the Government (October 14)-there remained 125 days of the contract in which teams were worked, and the defendants paid for 3,429-f days (on the basis of one team per day), and during that period there were employed, as shown by the records of the War Department, 3,814 teams. Admitting that plaintiff would have worked his 14 teams all of the 125 days, he would have worked 1,750 days. If, therefore, his profit was $1.13 per day on each of his teams, the aggregate profit thereon would be $1,977.50. Plaintiff had, of his own •accord, raised the price for the 50 hired teams from $2.50 a day to $2.75, which would have left him a profit of 63 cents on each team per day during the remaining period of his contract; and, calculating on the basis of one team for l,679f days at 63 cents per day, his profits would have been $1,058.08. This amount plus $1,977.50 — the profit allowed on his own 14 teams — would show a net profit to the contractor of $3,035.58. We have taken the official report of the War Department for the number of teams paid for the period from the annulment of the contract to March 1,1911, when it would have expired by limitation, and after making a reasonable allowance for the 'upkeep of plaintiff’s 14 teams our conclusion is that plaintiff should be given a judgment for the sum of $3,035.58, as shown by Finding XIV.

We have not considered plaintiff’s claim embodied in' Findings XVI, XVII,' and XVIII, based upon alleged profits which would have accrued to him if he had been permitted to complete his contract, or for alleged loss to him because of the abrogation of the contract by the agents of the defendants, for the reason that the operation of a commissary business was not a part of the contract and had no connection with executing the work required under the same.

Judgment is accordingly awarded to plaintiff for the sum of $3,035.58.