Case Name: HARRY E. OVERSTREET v. THE UNITED STATES
Court: United States Court of Claims
Jurisdiction: United States
Decision Date: 1920-02-24
Citations: 55 Ct. Cl. 154
Docket Number: No. 31341
Parties: HARRY E. OVERSTREET v. THE UNITED STATES.
Judges: Graham, Judge; Hat, Judge; Booth, Judge, and Campbell, Chief Justice, concur.
Reporter: United States Court of Claims Reports
Volume: 55
Pages: 154–174

Head Matter:
HARRY E. OVERSTREET v. THE UNITED STATES.
[No. 31341.
Decided February 24, 1920.]
On the Proofs.
Contract, payments under; breach. — Where a contract provided that the Government should make monthly payments on estimates, the payments should have been made within a reasonable time thereafter and without unnecessary delay, but a delay of 8 days in payment of a voucher is not unreasonable and the contractor was not justified in rescinding the contract on the theory of a breach of covenant by the Government.
Same. — But the sending of a Government officer, whose signature was necessary on the vouchers, to another duty at a remote point, when there was power to designate some one in his stead, thereby preventing the contractor from receiving pay for his work in the month of May until July 8, constituted under the circumstances such unnecessary delay as amounted to a breach of the contract and justified the contractor in abandoning the work.
The Beporter's statement of the case:
Mr. Thomas P. Littlepage for the plaintiff. Messrs. Sidney P. Taliaferro and L. Bussell Alden were on the briefs.
Mr. P. M. Gox, with whom was Mr. Assistant Attorney General Franlc Davis, jr., for the defendants.
Plaintiff has sought to make it appear that the United States by not making payments within a few days after the first of each month created a financial situation in his affairs which made it impossible for him to perform. The evidence in this case, however, does not warrant - such a conclusion. To justify abandonment, the alleged impossibility created by the opposite party must be real and not a mere inconvenience.
.In Smoot's case, 15 Wall., 36, appealed from this court, it appeared that plaintiff abandoned his contract to supply a number of cavalry horses because the War Department changed its rules with respect to inspection after the agreement had been entered into, by reason of which fact the owners, plaintiff’s subcontractors, refused to furnish him with the mounts. Mr. Justice Miller, delivering the opinion for the court, said among other things, that—
“As between individuals, the impossibility which releases a man from the obligation to perform his contract must be a real impossibility, and not a mere inconvenience. And while such an impossibility may release the party from liability to suit for nonperformance, it does not stand for performance so as to enable the party to sue and recover as if he had performed.”
So in Lewman's case, 41 C. Cls., 470, it appears that plaintiff abandoned the contract because of various delays and obstructions interposed by the officers of the United States during the prosecution of the work, as well as on account of the failure of the Government to make payment for certain cement furnished. The court, speaking of plaintiff’s obligation to perform, said:
“Unforeseen difficulties, however great, will not excuse him. * * * In other words, the impossibilities assigned for the release of one from the performance of his contract must be real and not mere inconveniences. Difficulties and improbabilities of performance arising from such changes will not avail as a ground for abandonment. * * *
“Had the claimants been ordered to stop the work, then the case would be like those of United, States v. Behan (110 U. S., 338; Houston Construction Co. v. United States (38 C. Cls., 724); or United States v. Speed (8 Wall., 77).
“ It follows, therefore, to justify abandonment of the contract the acts of the engineer officer complained of must haA^e been such as would have rendered performance of the rest of the contract impossible or a thing different in substance from that which was contracted for (pp. 474, 475). * * *
“ But assuming such action to have been a partial failure on the part of the defendants, it is a recognized principle that a partial failure of performance by one party to a contract which may be compensated in damages does.not give the other party the right to rescind or abandon the contract. Franldin v. Miller (4 A. & E., 599); Selby v. Hutchinson (4 Gilman, Ill., 333).”
Plaintiff’s last extension under the grading contract expired July 1. He was, therefore, in default on July 5, when he quit (1) because he had not fully performed within the time agreed; (2) because he had not prosecuted the work with diligence and fidelity and had not substantially completed the same by July 1; and (3) because on July 3 he liad been paid all that was then due and owing under this contract, and hence there was no ground for abandoning the same.
The contracts herein only required that intermediate payments be made in monthly installments as the work progressed, but did not require these payments (except the last and final payments) to be made on or before any day certain. Assuming for the sake of argument, however, that some intention not expressed could be read into the contracts that payments were to be made within some specific period, plaintiff still has no ground for recovery herein, for the reason that he was in default at the time he abandoned in fulfilling the terms of the agreement.
In McGrath v. Morgan, 72 App. Div., 76 N. Y. Supp., 412, 415, it was said that—
“Where a contractor, acting in good faith, removes his men and tools, believing that he has fully completed his contract, but in fact slight omissions are found, which may be readily supplied or remedied, the liberal and just rule of substantial performance obtains in equity; and he may recover a proper reduction from the contract price, being made to indemnify the owner. Even if this rule were to be applied in the case at bar, we think the plaintiff could not recover the fourth payment upon the ground of substantial performance, but we are of opinion that the rule should not be applied with the same liberality in a case where, as here, the contractor deliberately abandons the work, without any pretense of having fully completed his contract, and solely on account of the failure of the owner to pay an installment intermediate the commencement and completion of the work. If the liberal rule of substantial performance is to prevail in such cases, then upon such abandonment it would require an appraisal of the damages to be deducted by the owner, and this would necessarily delay the work. It is one thing to lay down a liberal rule to prevent an owner from reaping the benefit of the services of a contractor who, acting in good faith, leaves the premises on the supposition that his work has been fully completed; and it is quite another to announce a doctrine, not required by any rule of equity, which will lead to endless confusion, delay, and litigation in the execution of building contracts. The summary abandonment of an incomplete contract is likely to prejudice not only the owner but the rights of other contractors and their employees as well. When a contractor picks up his tools and orders his men to quit work on the ground of a breach of contract on the part of the owner in failing to make an intermediate installment payment, he should be prepared to show full performance of all conditions precedent to his right to such payment. The plaintiff refused to proceed with the execution of his contract, and elected to stand upon his strict legal rights. He must, therefore, in order to recover, bring himself fairly within the terms of the contract by showing performance of the obligations he incurred, 1 without any omission so substantial in its character as to call for an allowance of damages.’ ”
And in Golden Gate A. Go. v. Sahrbaeher, 105 Cal., 114, the court used the following language:
“Was the contractor entitled to receive the second installment of money? In other words, Was the second installment due? And the answer to that interrogatory is solely dependent upon a determination of the fact as to whether or not the contractor had progressed with the building according to the plans and specifications, to the extent of having placed the brown coat of mortar thereon. If he had done so he had the legal right to stop work when the second installment was not forthcoming; but, if he had not performed the contract according to its terms at the time he demanded the second installment, then it was not due, and he was not justified in leaving the work; and if he left the work without cause it wras an abandonment of the contract, as contemplated by section 1200 of the Code of Civil Procedure, and the plaintiffs’ rights in this action would be measured by the provisions of that section.
“ Upon an examination of the evidence we conclude that the contractor failed to comply with the terms of liis contract in substantial particulars, and, having committed breaches of the contract, he was not justified in leaving the work as he did leave it.”
In Williams v. City of New York (114 N. Y. Supp., 652) plaintiff claimed breach of contract by the city in' consequence of its neglect to pay promptly the monthly estimate. The estimate had been made on January 12 and on February 24 the contractor served notice of his rescission of the contract. In the course of its opinion the court aptly said:
“The defendant had a reasonable time within which to pay to the plaintiffs the amount due, and a mere delay in payment for a reasonable time to enable it to make the necessary arrangements for that purpose was not, upon any possible construction of the contract, a breach thereof. The comptroller of the city of New York can not be expected to have the money ready, and the warrants drawn for the payment of claims against the city immediately upon presentation. The fiscal officer of a large municipal corporation is entitled to a reasonable time after a claim is presented to make payment. There is nothing to show that the liability of the city to pay this amount was ever repudiated by the comptroller. There was a simple delay in making the payments.”
The cases' cited seem to be decisive of the questions Involved in the case at bar.
The following are the facts of the case as found by the court:
I. Plaintiff is a citizen of the United States and at the time of the occurrences hereinafter mentioned was a resident of the city of Chicago, State of Illinois. On June 25, 1906, plaintiff entered into a written contract with the defendants through the Chief of the Bureau of Navigation, Navy Department, for certain grading and filling at the Naval Training School, Great Lakes, North Chicago, Ill.
Counsel for the respective parties have stipulated of record that the paragraphs of said contract set out in plaintiff’s petition are and shall be deemed and considered for the purposes of litigation all of the necessary and essential parts of said contract except paragraph 56 of this contract reading as follows:
“ 56. Measurements. — All measurements for payments, both monthly and final, will be made at site of inner basin from material excavated. The contractor shall excavate to a depth of 10 feet below datum; any material excavated below minus 10 feet 6 inches shall not be paid for. Any material in side slopes below a 1 to 1 slope from a depth of minus 10 feet 6 inches at lines shown in inner basin shall not be paid for except in case such material should cave or run down into basin and require excavating.”
II. Thereafter, on October 20, 1906, plaintiff entered into a second written contract with said Chief of the Bureau of Navigation, Navy Department, for the construction and completion of four houses for officers’ quarters at said Great Lakes Naval Training School, North Chicago, Ill., at an agreed contract price of $54,000.
The stipulation of counsel referred to in the former finding as to paragraphs of the contract set out in the petition applies also to this contract but without the exception. x
The following are provisions of the specifications relating to payments for work done, liquidated damages, and annulment of contract, which are in the main the same as to both contracts. As set out below and numbered they appear in the officers’ quarters case. In the grading case “ 38 ” is “ 36 ” and omits the exception. “ 39 ” is “ 37 ” and “ 40 ” is “ 38.” “ 26 ” is “ 25 ” and refers therein to “ paragraph 26 ” instead of “ paragraph 27 ” and $20 per day is provided as liquidated damages instead of $25.
“ 38. Payments. — Payments will be made by the Government in monthly installments as the work progresses, with a reservation of 10 per cent for each installment, to be held until the final completion and acceptance of the work, except as provided in paragraphs 39 and 57 of these specifications. Payments will be based on an estimate, to be made by the officer in charge of the work, of the amount of work done on the station during the previous month and on the schedule of unit prices. No payments shall be made except upon bills, in quadruplicate, approved by the commandant of the Great Lakes station, in such manner as shall be directed by the Chief of the Bureau of Navigation, whose final approval of all bills, thus certified, shall be necessary before payment thereof.
“ 39. All warrants for payments under these specifications shall be made payable to the contractors at such Navy pay office as they may designate. The last payments shall not be made until the contract shall have been fully performed by or on the part of the contractor and the work shall have been accepted by the Government. When all the conditions, covenants, and provisions of these specifications shall have been performed and fulfilled by and on the part of the contractors they shall be entitled, within ten days after the filing and acceptance of their claim, to receive the last payment, on the execution of a final release to the United States, in such form as shall be approved by the Chief of the Bureau of Navigation, of all claims of any kind or description under or by virtue of these specifications.
“ 40. The monthly payments on the work during its progress shall not be considered or understood to be a final acceptance of the work in question, and any work or material which is of an inferior quality or proves unsatisfactory in any respect at any time shall be rejected and replaced by the contractor to the satisfaction of the officer in charge or the work, notwithstanding that payments have been made upon such work or material.”
“26. Damages for delay. — In case the work is not completed within the time specified in the contract or the time allowed by the Chief of the Bureau of Navigation under paragraph 27 of these general conditions it is distinctly understood and agreed that deductions at the rate of $25 per day as liquidated damages shall be made’ from the contract price for each and every calendar day after and exclusive of the date within which the completion was required up to and including the date of completion and acceptance of the work, said sum being specifically agreed upon as the measure of damage to the United States by reason of delay in the completion of the work; and the contractor shall agree and consent that the contract price, reduced by the aggregate of damages so deducted, shall be accepted in full satisfaction for all work done under the contract.”
“31. Annulment of contract. — Should the contract for any reason be declared null and void, the contractor shall thereupon become indebted to the United States as for ascertained and liquidated damages in a sum equal to the aggregate of all payments made to him on account of the contract, and undertakes and promises to refund the same to the United States on demand. And the contractor further agrees that the United States may hold all material delivered and work done under the contract and all machinery, tools, appliances, etc., upon the site of the work, or used in connection therewith, pending the completion of the work covered by the contract. Upon the annulment of the contract a board of officers, or other representatives of the United States, shall be appointed, which shall ascertain and determine the value of all material delivered and work done, including a fair and reasonable margin of profit thereon, and upon approval of the findings of said board by the Chief of the Bureau of Navigation he may proceed to complete the work according to the contract, and in such manner and by such means as he may deem advisable, and may, in his discretion, use or employ any material, tools, machinery, appliances, etc., belonging to or furnished by the contractor for use in connection with the work covered by the contract. Upon the completion of the work, should the total cost thereof exceed the contract price, the difference will be charged to the contractor, who undertakes and promises to pay the same upon demand; and the contractor shall be entitled to receive the amount found due by the board above mentioned, including any 10 per cent reservation from the payments previously made, but no allowance shall be made for profit which the contractor might have made by completing the work or for any excess of the contract price over the total cost of the work.”
III. Plaintiff promptly entered upon the preliminary work under said grading and filling contract, and was under way by July 19 following. He soon encountered difficulties in its prosecution, due primarily to lack of capital and credit, and on October 25,1906, the contract date for the completion of said work, plaintiff had completed about one-quarter of the work required under said contract. On November 3, 1906, plaintiff,. in writing, requested an extension of time for the completion of said work, which request was promptly approved by defendants’ officer in charge of the work and forwarded to the Chief of the Bureau of Navigation. That officer declined to formally extend the time limit, but stated that the question of an extension would be considered on the completion of the work, and plaintiff was duly informed of that fact.
IV. Plaintiff began work under his contract for officers’ quarters shortly after the date thereof. Early in December, 1906, plaintiff requested permission to postpone further work thereunder until the following spring. This request was granted by defendants’ officer in charge. No work on officers’ quarters was done from December 7,1906, to April 30,1907. Work on this contract might have been done in March and April, 1907.
After December 21,1906, plaintiff brought his work under the grading and filling contract to a practical standstill. A very small amount of work was done in January and February, but there was no substantial progress until early in March, 1907.
For some time subsequent to November, 1906, plaintiff felt anxiety over his status with respect to the possible deduction of liquidated damages for nonperformance of his contract within the contract period, because the contract period for grading and filling had not been extended, and on March 20, 1907, plaintiff stopped all work under this contract and stated to defendants’ officer in charge that he was unable to collect money due him and would be compelled to give up his contracts for grading and officers’ quarters. There was then nothing due him on either contract. On March 22, 1907, plaintiff had a conference with defendants’ officer in charge, and that day requested a formal extension of the time for the completion of the contract for officers’ quarters to August 1, and on the same day wrote defendants’ officer in charge the following letter:
“.Referring to our conference to-day, also to my previous communication under date of November 3, 1906, and your reply thereto, No. 1995, December 17, 1906, concerning my grading contract No. 1, I beg to advise that under tbe instructions therein I have proceeded continuously with the said work; that owing to the open wet weather it has been impossible to make much headway up to this time, my expenditure to date being more than double the amount received on estimates. I am now able to sublet the remainder of the work to a responsible contractor who will proceed immediately to complete it, provided I can guarantee him against the penalty for delay in completion for 90 days from April 1, 1907. Therefore I request that the bureau grant me an extension of time for completion until July 1, 1907, without penalty. The extraordinary character of this work, the constantly changing variety of material encountered, the great delay by railroads in delivering to me material for use on the work, and the fact that my delay will not have occasioned the bureau any extra expense are good grounds, I believe, on which the bureau are warranted in granting my request.”
These applications for extension of time were forwarded to the Chief of the Bureau of Navigation with recommendation that an extension of time for completing the grading and filling contract be given to July 1, 1907, and that an extension of time for completing the contract for officers’ quarters be given to July 20,1907. Extensions of time as recommended were given and. plaintiff was informed of the fact April 10, and defendants’ officer in charge twice between that date and April 24 addressed written inquiries to plaintiff as to when work would be resumed. April 24 plaintiff informed defendants’ officer in charge by letter of his inability to sublet the grading and filling contract and of his hope to be able to say whether he would start the work shortly, and also stated that if he could receive an estimate for work in February and March he would distribute it to his workmen and thereby relieve the situation. At that time the estimate for work in February had been issued and paid. On May 2 plaintiff resumed preliminary work on the grading contract and continued this character of work throughout that month by relaying the track with heavier rail and providing equipment so as to enable him to make more expeditious progress on grading and filling.
On April 30 plaintiff resumed work on the officers’ quarters and on June 1 he resumed the work of excavating and filling which continued slowly and with many interruptions until June 26, after which, for the remainder of the month, no work under this contract was done.
Y. In order to enable defendants’ agents to comply with the provisions of the contracts involved herein for making-monthly estimates of work done and in preparing vouchers in payment therefor, it was necessary on or about the first of each month in grading work that a hydrographic survey be made of the basin from which the grading material was excavated to ascertain the depths where the dredge had been worked. Survey notes were platted and then entered on plan and cross sections of the basin. Calculations were then made of the volume excavated. A memorandum report of the volume so found was then submitted by the engineer making the survey, which, after examination by the engineer in charge, was passed to the chief clerk if found correct. The chief clerk, after checking the survey, passed the memorandum to a clerk for preparation of voucher. The voucher was then signed by the engineer in charge and forwarded to the commandant for approval and transmission to the Chief of the Bureau of Navigation at Washington for final approval. From that office it was sent to the Bureau of Supplies and Accounts of the Navy Department for inspection, and from there the voucher was forwarded to the purchasing pay officer who made payment.
VI. Under the grading and filling contract vouchers were drawn, forwarded to Washington for approval, approved by the Bureau of Navigation, and paid plaintiff on the several dates following:
Plaintiff by letter dated June 3, 1907, informed the Chief of the Bureau of Navigation that nonpayment of voucher No. 8, under the grading contract, shown in the above table, and voucher No. 5, under the officers’ quarters contract, shown in Finding VII, was working a hardship on him, and requested that payment be expedited. Voucher No. 5 was paid plaintiff June 4,1907. Voucher No. 8 was paid July 3, 1907.
Defendants’ officer in charge delayed the issuance of voucher No. 8, shown in the above table, from April 1 to May 2, pending the receipt of advices that an extension of the time limit had been granted and because plaintiff failed to resume work during the month of April. He had on May 2 resumed work preliminary to the actual work of grading and filling. The delay in issuing said voucher from May 2 to May 27 was due to time consumed by subordinate officers in resurveying the basin and rechecking calculations to explain why survey for April showed plaintiff had been overpaid for about 1,000 cubic yards. This discrepancy was found to be due to silt that was washed into the basin by a stream and was not an overpayment. A further delay of 15 days between the time said voucher was drawn and when it was approved by the commandant was caused by that officer’s absence from the Great Lakes training station on official business.
VII. Under the contract for the construction of officers’ quarters vouchers were drawn, forwarded to Washington for approval, approved by the Bureau of Navigation, and paid to plaintiff on the several dates following:
Voucher No. 1 was drawn November 10. It should only-have contained work performed and material supplied to October 31. To aid the plaintiff it was drawn to include all work performed and material supplied to and including November 8.
To assist plaintiff voucher No. 5 was specially prepared to cover work done and materials used on April 30 and the first half of the month of May.
Voucher No. 6 was drawn June 7 and sent to the commandant for his approval. He was absent from the station, and an attempt was made to forward it to him at Portland, but it did not reach him promptly. The Bureau of Supplies and Accounts on June 17 telegraphed the training station to forward duplicate voucher to the bureau without the commandant’s approval. This was immediately done. The commandant returned to the station and on June 21 signed and returned to the bureau the original voucher, which had been recovered. The cause of delay thereafter is not shown.
VIII. July 1, 1907, the extended time for the completion of the grading and filling contract had expired, but work was continued in a small way from that day until July 5, after which it ceased altogether.
July 3 plaintiff went to the training station about vouchers due which he understood were ready for him. He received voucher No. 8, $778.97, grading and filling contract, but voucher No. 6, $1,386.90, officers’ quarters contract, was not there. He then notified the commandant that if vouchers due were not in his hands by the 8th he would close down the work and charge the Government with breach of contract. The only voucher then due which he had not received was said No. 6 on the officers’ quarters contract. A reasonable time had not elapsed for the preparation, certification, etc., of No. 7 under that contract.
July 6, 1907, he telegraphed the Chief of the Bureau of Navigation, Washington, saying, “ Voucher June seventh, thirteen eight six ninety, officers’ quarters, May work, not received; please forward to-day.”
July 8,1907, plaintiff verbally notified the commandant of his intention to abandon the work under both contracts, stating as his reason for so doing that lack of funds would prevent further progress and completion of the work. Voucher No. 6 had not then been received. The plaintiff was requested to confer with his surety, the Fidelity & Deposit Co., of Baltimore, as to the situation. On the same day the commandant telegraphed the Washington office to stop all payments on vouchers, which was done.
July 12 representatives of plaintiff’s surety called, with him, on the commandant and after conference stated that no further advances would be made the contractor, and that the surety would not desire to take over and complete the work. The commandant notified the Bureau of Navigation of the facts as to the abandonment of the contracts, and recommended that a board of officers be appointed to ascertain the value of materials delivered and work done, and that the remainder of the work be immediately readvertised.
Under the same date, July 12, the plaintiff wrote the commandant of the training station as follows:
“ Sir : Referring to my letters of June 3, June 15, and telegrams July . 6 to the Chief of Bureau of Navigation, Washington, concerning nonpayment of vouchers for estimates due me for work done under contracts for grading and filling officers’ quarters, and also to my conference with you on July 8, in which I informed you that unless the bureau made its monthly payments to me according to the contract I could not longer carry on the work, I beg to advise you that for the above-stated reasons I have shut ‘down the work under both contracts and await a satisfactory adjustment of my accounts.
“ On July 3 I received a greatly underestimated voucher for grading performed in March. I have received no voucher for work performed on either contract during the months of May and June, though work has been prosecuted continuously on both contracts through both months.”
No grading or filling had been done during the month of May, and voucher No. 5, officers’ quarters contract,-received by the plaintiff June 4,1907, had included an estimate under that contract to and including May 15.
July 16, 1907, the plaintiff wrote the Chief of the Bureau of Navigation at Washington as follows:
“ Dear Sir : In accordance with my letter to Capt. A. Boss, commandant United States naval training station, North Chicago, Ill., dated July 12, 1907, I now write to formally notify yon that in consequence of the failure of the United States Government to perform its part of the two contracts with me, dated, respectively, June 25, 1906, and October 20, 1906, by neglecting to pay me the monthly installments due me under said contracts, I have been compelled to shut down on the work and rescind the contracts and await a satisfactory adjustment of the amount I am entitled to receive for the work I have already performed.”
A board of officers was appointed in the manner provided by the contract and this board after due inquiry found and reported on September 2, 1907, that the plaintiff had excavated from the basin and filled in the ravines 27,374 cubic yards of material, which, at the contract price of 59 cents per cubic yard, amounted to $16,150.66. The aggregate amount of payments theretofore received by plaintiff is $12,777.45, which is $3,373.21 less than the value of the grading and filling work done. Said board further reported that at the contract rate the value of the work done and^materials furnished by plaintiff under said contract for officers’ quarters was $11,548.71. The aggregate amount of payments theretofore made to plaintiff is $9,026.55, which is $2,522.16 less than the value of work done and materials furnished for officers’ quarters, including a reasonable profit.
IX. After the work under said contracts was abandoned, the defendants’ officers retained all material, machinery, tools, and appliances brought by plaintiff upon the scite of the work or used by him in connection therewith.
August 24, 1907, plaintiff, with a letter to the Chief of the Bureau of Navigation, inclosed a statement of the amounts he claimed to be due him under each contract, and as a part of the amount stated to be due under the grading contract he included $10,000 as the value of the tools which he said “ are at present in the custody of the officers of the naval station and which they have refused to deliver to me,” and which he also asserted were worth more than the amount stated. In said letter he also made demand for the return of the tools and protested against their use by the Government or any other contractor. No response, so far as appears, was made to this demand and protest.
On August 9, 1911, the then commanding officer of the naval training station wrote the plaintiff as follows:
“ SiR: Referring to the equipment which was used by you in the prosecution of your contracts at this station for grading and for the construction of four houses for officers’ quarters, which equipment, upon your abandonment of the contracts mentioned, was seized by the Government and retained for use in the completion of the works, as provided for in the specifications forming a part of the contracts in question, you are advised that I have been instructed by the Navy Department to inform you that said equipment should be removed by you within 60 days, and that if you fail to do so it will be sold, the proceeds of the sale, less expenses, to be credited in the statement of your accounts.”
And on August 23, 1911, the commandant addressed to him the following letter:
“ SiR: There is inclosed herewith a copy of the station’s letter No. 16959, of August 9,1911, with reference to the department’s instructions in regard to the disposition of the equipment used by you in the prosecution of your contracts at this station for grading and for the construction of four houses for officers’ quarters. It is requested that you acknowledge the receipt of said letter, advising this station of the action you propose to take in regard thereto. This communication and its inclosure are forwarded to you by registered letter No. 773.”
The commandant wrote plaintiff again on the 14th of September, 1911, calling attention to the above letters and requesting information as to the action he proposed to take on the request for the removal of the equipment. No response was made to these letters. The equipment referred to had been used either in whole or in part during the completion of the grading and filling contract by the contractor therefor and after its completion it was appraised by representatives of the United States who determined its then value to be $3,530.50. What disposition was finally made of it is not shown. If sold by the United States in accordance with the •notification in the letter of August 9, 1911, the amount realized therefor is not shown and no credit is given the plaintiff therefor in any submitted statement of account.
X. The work of completing the grading and filling contract was advertised for bids and bids received were opened in Washington on August 26, 1907, and contract was let to Edwards Bros. Dredge Co. at their bid of 81 cents per cubic yard. The work was completed by that company and it was paid for the work done by it $6,006.72 more than the work would have cost the United States under plaintiff’s contract. The work under the officers’ quarters contract was completed by James E. Hale under a contract entered into with him on September 20, 1907, and he was paid $10,715.55 more than it would have cost the United States under plaintiff’s contract.
XI. The actual expenditures made by plaintiff in the prosecution of the work under his grading and filling contract for labor and materials were $45,816.22, and payments received by plaintiff from defendant under this contract aggregated $12,777.45.
The actual expenditures made by plaintiff in the prosecution of the work under his contract for officers’ quarters for labor and materials were $45,816.22, and payments received by plaintiff from defendant under this contract aggregated $9,026.75. It does not appear from the evidence that plaintiff would have made any actual profit over and above expenditures or would have incurred actual loss by continuing the work under both contracts to the end and receiving the full contract prices therefor.

Opinion:
DowNey, Judge,
delivered the opinion of the court:
Plaintiff's action is predicated on two separate contracts, one for grading and filling and one for the construction of officers' quarters at the naval training station, Great Lakes, Chicago, and he seeks to recover on the theory that the United States breached both contracts by failure to make payments as required thereby. Plaintiff contends that he rescinded both contracts because of the Government's breach, and that he is entitled to recover his expenditures as to each, together with a reasonable profit.
There is no doubt as to the obligation of the Government under the contracts to make monthly payments on estimates. But some time was necessarily required to make an estimate, prepare voucher, secure its necessary certification, and approval, etc., and therefore the contract must be interpreted to mean that payments for work done each month would be made within a reasonable time thereafter, in the light of all the circumstances, and should not be unnecessarily delayed. Did the Government so make its payments?
Under the grading contract the plaintiff had done some work in the month of March, 1907, but had then suspended work pending an application for an extension of time, which was granted, and pending efforts to procure some one else to take over this contract because of his own declared inability to carry it on. The extension of time, afterwards granted, was represented to be necessary to enable him to sublet the contract. He did no grading in- April or May, but having failed to sublet the contract, he did some work in May in preparation for further work under the contract and resumed grading and filling in June. His voucher for work done in March was held up because of the uncertainty of his proceeding with the work, but, having resumed, this voucher, No. 8, for $778.97, was delivered to him July 3.
On July 3, 1907, he notified the commandant of the training station in substance that if vouchers due him were not in hand on July 8 he would abandon the work and rescind the contracts. Then, having received voucher No. 8, there was nothing due him on the grading contract. His theory is that he elected to rescind the contracts on July 8. It is apparent that he could not rescind on account of any delay on voucher No. 8, for he had received it on the 3d. We think it was then too early for him to complain of any delay as to the voucher for work done in June. This voucher, No. 9, had been issued on July 5, about the usual time after the end of a month, and forwarded to Washington, and would probably have been in plaintiff's hands within a reasonable time had he not abandoned the work. It had been stopped by telegraph when he did so, but that was only the eighth day. The average time for the delivery of vouchers, except No. 8, during the progress of this contract had been, as shown, 9f days. A somewhat longer period than that could hardly have been held unreasonable. If there was then no breach, there could be no ground for an attempted rescission, and the contractor was in default when he abandoned the work.
The unfinished work under this contract was advertised and let and completed by another contractor at a cost of $6,006.72 in excess of what it would have cost the United States under plaintiff's contract; and assuming, as we do, that there was no breach of the contract by the United States justifying its rescission by the plaintiff, this excess cost is a proper charge against the plaintiff. It was ascertained by the prescribed method that the plaintiff had done work of the value of $16,150.66, on account of which he had been paid $12,777.45, leaving due him on account of work done $3,373.21. Plaintiff's equipment had been taken over by the Government. It was authorized by the contract in such circumstances to do so " pending the completion of the work covered by the contract." . Although somewhat indefinite in form, the contract must be construed as authorizing the use of the equipment in the completion of the contract. Theoretically the use of the equipment would lessen the cost of the completion of the contract and inure to that extent to his advantage. After the completion of the work the equipment was appraised by representatives of the United States at $3,530.50, and the plaintiff was requested to remove the same within a stated time, and notified that, failing so to do', it would be sold and the proceeds credited to his account. He did not remove it, and there is no showing as, to what was done further with reference thereto. Under the circumstances we think it must be assumed that the United States did what it notified the plaintiff it would do, and sold this equipment. In the absence of any showing as to the amount realized therefor it ought to be charged against the United States at at least the valuation put on it by its own representatives. The setting off of the first item against the sum of the two others leaves $895.99 in favor of the plaintiff under the grading contract.
The conditions under the officers' quarters contract were somewhat different. On July 8, 1907, the plaintiff had not yet received voucher No. 6 for $1,386.90 on account of materials furnished and labor performed in the last half of the month of 'May. This voucher had been issued on the 7th of June, but delayed for reason now assigned as " good excuses," partly the absence of the commandant, and the absence is regarded as a sufficient excuse for delayed payment because it was on "official business." We can not adopt the theory that the sending of a Government officer to another duty at a remote station justifies a violation of contract obligation, to the damage of the other party, particularly when there was power to designate some one else to act in his stead, if the power did not lie without specific designation. There was considerable unexplained delay after the voucher was approved by the commandant, and we are of the opinion that there was such unreasonable delay in making this payment as amounted to a breach of the contract and justified the contractor in abandoning the work and rescinding the contract.
Question is made as to whether he did, in fact, elect to rescind the contract because of this breach by the Government, and it' is argued, probably with force, that if he was otherwise financially embarrassed and unable to proceed with the work and did not, in fact, at the time abandon or rescind the contract because of the Government's breach, he can not now avail himself of this breach. There is some room for the contention since, as found, he predicated his action, in conversation had that day, on "lack of funds," without specific reference to the Government's delinquency, and afterwards, in letters of the twelfth and sixteenth, assigned that delinquency as the reason for his action, giving rise to the suspicion of an afterthought, but he had some days before the eighth indicated the course he would pursue if vouchers were not in hand by that day, and the fact that he is not shown, in conversation afterwards detailed, to have used language entirely appropriate to the assertion of his right, should hardly be held sufficient to deprive him of it.
And it is contended that it was a pretext, a subterfuge, to shift responsibility for his shortcoming, and that the amount involved was not sufficient to give merit to his claim of a right to rescind because of the default. In a sense, the amount was not large, but whether large or small is a comparative matter, and an amount of money insignificant under some circumstances may be of abnormal value under others. We must know that this transaction was during a time of financial stringency, a " panic," so called, when it was diffi cult for one even to get Ms own money out of a bank, and loans, as ordinarily made, were suspended. We can not say, under such circumstances, that this amount was insignificant, and that it might not have enabled the plaintiff to pursue his work. And we are not called upon to find that it would have enabled him so to do. If the breach was as to a material matter, and we can not say that it was not, it was the plaintiff's option to exercise his resultant right if he saw fit to do so.
It was ascertained by the prescribed method that the value of the materials furnished and labor done by him, including a reasonable profit, was $11,548.71, and that he had been paid $9,026.55, a difference of $2,522.16, which we think is the correct measure of the plaintiff's recovery as to this contract.
In the aggregate the plaintiff should have judgment for $3,418.15.
Graham, Judge; Hat, Judge; Booth, Judge, and Campbell, Chief Justice, concur.