Case ID: us-ct-cl_60/html/0315-01.html
Source: Caselaw Access Project
Author: {"author": "", "license": "Public Domain", "url": "https://static.case.law/"}
Date Created: 2024-08-24T03:29:51.129683

LESTER AUSTERN v. THE UNITED STATES
    [No. A-12.
    Decided February 2, 1925]
    
      On the Proofs
    
    
      Contract; implied agreement; Dent Act. — Wlicre plaintiff is requested by a procurement officer of the Quartermaster Corps to prepare for the performance o-f a contract, the award of which has been approved but not issued, and fails to show any expenditures in consequence of or reliance on such request, he can not recover 'under the provisions of the Dent Act.
    
      
      The Reporter's statement of the case:
    
      Mr. David Ham* for the plaintiff.
    
      Mr. Hov)ard J. Bloomer, with whom was Mr. Assistant Attorney Generad Robert H. Lovett, for the defendant. Mr, Joseph Henry Cohen was on the brief.
    The following are the facts as found by the court:
    I. The plaintiff is now, and was during all the times mentioned in his petition, a citizen of the United States and a resident of the city and State of New York.
    II. In the month of February, 1918, the plaintiff was a manufacturer of raincoats, and in the latter part of that month he came to Washington and called on Mr. A. W. Larvrence, who was at that time chief of the procurement section of the shoes, leather, and rubber goods branch of the Clothing and Equipage Division, Quartermaster Corps, United, .States Army, and discussed with said Lawrence the question of manufacturing raincoats.
    During the winter of 1918 many suppliers, the plaintiff among others, came to Washington seeking contracts. The plaintiff was told by Mr. Lawrence that the Government was in need of quantities of raincoats, and that when it came time that actual purchases were to be made they would be made on bids following specifications, and those bidding at a Ioav figure must first satisfy the department as to their ability to fulfill such a contract. No assurances were given to the plaintiff that he 'would be given a contract, and no promise Avas made to him by Mr. Lawrence that he Avould be given a contract, and no agreement of any kind was made betAveen the plaintiff and Mr. LaAvrence that he, the plaintiff, vrould be employed by the Government to manufacture raincoats. In this conference or conversation with Mr. Lawrence nothing was said as to the quantity of raincoats to be manufactured, nor as to the price, nor as to the time of manufacture.
    III. Some time in February, 1918, the plaintiff purchased a plant for the purpose of manufacturing raincoats. This plant was located at Rockaway Avenue, Brooklyn, and because of labor conditions he sold the said plant on April 15, 1918, and then purchased a plant at 88 and 85 Green Street, New York City; he.equipped the two plants and the total cost of said equipment was the sum of $15,335.78. Thereafter, in March, 1918, in response to a regular form sent to manufacturers of raincoats by the Government, the plaintiff prepared and submitted a sample raincoat to the War Department which was approved by said department, and after the said sample had been approved the plaintiff submitted a bid of $5,575 per raincoat. This bid was not follow; cl by the award of any contract.
    IY. The plaintiff made no use of his plant, but continued trying to obtain a contract for the manufacture of raincoats; but no contract was awarded him, and he was told that owing to conditions then existing no contracts would be awarded to him or to anyone until those conditions were changed. The plaintiff claims that his services were at the call of the Government, and that those services were worth the sum of $12,000. He therefore claims that the Government is indebted to him in the sum of $24,405.78, after giving the Government credit for the sums for which he sold the plants which he had purchased; and thi,s is his claim which he bases upon the alleged assurances given him by Mr. A. W. Lawrence.
    Y. About the last of April, 1918, proposals were sent out by Capt. A. W. Yaughan, who had taken charge of the procurement of raincoats in the Clothing and Equipage Division, and in response thereto plaintiff sent in a bid on 100,000 raincoats, but no award was issued in favor of plaintiff on this bid for the reason as stated by Captain Yaughan; “It was decided, and approved by Mr. McEl-wain and Mr. Donald, to give that business out on an upset price, which was slightly below the average price of the bids, and to pick the people who were to manufacture them. At that time labor conditions were bad and the deliveries of cloth were very bad, and there was a good deal of delay in getting out any additional business; also the type of coat was questioned.”
    YI. Subsequently, however, it was decided to give out new business, and in line with the policy adopted of choosing the manufacturer of raincoats rather 'than awarding contracts upon competitive bidding, Captain Vaughan selected four manufacturers of raincoats, including plaintiff, and recommended that a contract be awarded to plaintiff for 60,000 raincoats. This recommendation was approved by those charged with the duty of approving .same, but no award was ever issued to plaintiff for the reasons as stated by Captain Vaughan: “At about that time there was the arrest of a number of those raincoat manufacturers in New York, some of whom were in this list to be given business, and on the advic -, I think, of Major Savage, who looked after the legal end, all of those awards were held up.”
    VII. Subsequent to the approval of the award of contract to the plaintiff for the 60,000 raincoats, on June 9, 1918, Capt. A. W. Vaughan, a procurement officer, met the plaintiff in the Hotel- Martinique, New York, and told him the award had been approved, and requested the plaintiff to proceed with the preparations for performing the contract. The plaintiff, on or about June 12, 1918, apparently not satisfied with the understanding which he had had with Captain Vaughan, went to Washington to see about the award, and was there and then informed by Captain Vaughan’s superior officers that no contracts or orders were being issued; that their hands were tied, and that they could not do anything.
    VIII. The plaintiff claims that acting in reliance upon Captain Vaughan’s assurance he expended the sum of $18,-000 in purchasing and installing the necessary supplies and equipment for the manufacture of the 60,000 raincoats, and that he subsequently disposed of said supplies for the sum of $8,000, which amount he credited to the Government upon the total cost of $18,000.
    The evidence does not disclose that any expenditures were made by the plaintiff in consequence of or in reliance upon the request made to him by Captain Vaughan on June 9, 1918. It does not appear how much material he bought nor how he paid for it.
    The' court decided that plaintiff was not entitled to .recover.
   MEMORANDUM BY THE COURT

The evidence taken before the board of contract adjustment is by stipulation of the parties made a part of the evidence in this case. The evidence taken before the board is fuller and more complete than that taken in this court.

The board of contract adjustment found that the plaimiff was not entitled to recover, and that decision was approved by the Secretary of War. We are of opinion that that decision ivas right. See Decisions of the War Department Board of Contract Adjustment, vol. 1, p. 812, and vol. 6, p. 343, and especially see p. 344 of vol. 6, finding IX. See also Baltimore & Ohio R. R. Co. v. United States, 261 U. S. 592; Morgan Engineering Co. v. United States, 58 C. Cls. 373-379; United Gas & Electric. Engineering Corp. v. United States, 59 C. Cls. 176. No expenditures were made by the plaintiff upon the faith of any “ agreement express or implied ” entered into by him with an officer or agent acting under the authority of the Secretary of War or the President, and acting within the scope of his authority when such agreement was not executed in the manner provided by law.