Case ID: us-ct-cl_58/html/0036-01.html
Source: Caselaw Access Project
Author: {"author": "BY THE COURT.", "license": "Public Domain", "url": "https://static.case.law/"}
Date Created: 2024-08-24T03:29:51.129683

PENINSULAR STOVE COMPANY v. THE UNITED STATES.
    [No. 34699.
    Decided January 2, 1923.]
    
      On the Proofs.
    
    
      Contract; cancellation; recovery. — Where a contract between plaintiff and the United States to furnish certain articles stipulates that “it is understood that any part of this order may be canceled at any time without any obligation to the United States Government,” and the plaintiff proceeds to expend labor and material on said contract and while engaged in the prosecution thereof the Government notifies plaintiff that the contract is canceled, plaintiff is entitled to recover the cost of the labor and material so expended, less the proceeds of materials salvaged.
    
      The Reporter's statement of the case:
    
      Mr. William Luckinig for the plaintiff. Lucking, Helf-man, Lucking & Hanlon were on the briefs.
    
      Mr. W. L. dole, with whom was Mr. Assistant Attorneif General Robert H. Lovett, for the defendant.
    The following are the facts of the case as found by the court:
    I. The plaintiff, the Peninsular Stove Co., is and was at the time hereinafter mentioned a corporation organized under the laws of the State of Michigan, and was engaged in the manufacture of stoves and ranges at Detroit, Mich.
    II. On or about October 28, .1918, the plaintiff entered into a written contract with Brig. Gen. R. C. Marshall, jr., of the United States Army, acting on behalf of the United States, whereby the plaintiff agreed to furnish to the United States 500 No. 125 Army ranges at a price of $89 each. Said contract was accepted by both parties and, among other things, provided: “It is understood that any part of this order may be canceled at any time without any obligation to the U. S. Government.” A copy of said contract, marked “ Exhibit A,” is attached to the petition and is made a part of this finding by reference.
    III. On November 20, 1918, the plaintiff received a telegram from the Construction Division, United States Army, signed by B.. C. Marshall, jr., which read as follows: “Do not expect to use the five hundred and twenty-five ranges,” which was interpreted by the plaintiff to mean that the United States did not want the 500 No. 125 ranges. Upon receipt of this telegram the plaintiff at once stopped production of these ranges provided for in the contract. The plaintiff before the receipt of this telegram had expended in carrying out the contract for labor and essentials the sum of $19,000. The plaintiff salvaged materials of the value of $7,230.17, which, when deducted from the amount expended, leaves the sum of $11,769.83, the amount which the plaintiff actually lost by reason of its expenditures under the contract and which it has never been paid.
   MEMORANDUM

BY THE COURT.

Under the contract it was necessary for the plaintiff to expend money and get ready for its performance, which it did in good faith; and whatever money it expended in materials and labor it is entitled to recover, less the amount of the value of the materials salvaged by it.

Judgment for plaintiff in the sum of $11,769.88.