Court Opinion

ID: 8597883
Source: CourtListenerOpinion
Date Created: 2022-11-23 16:05:20.145484+00
Date Added: 2024-06-11T16:55:02.895693
License: Public Domain

NICHOLS, Judge,
concurring:
I concur in the judgment and in the court’s per curiam opinion, but add the following observations.
Once in a while it becomes necessary for compelling reasons of state that the government breach a contract it has previously entered into. Usually it has covered itself with suitable termination articles, but sometimes this precaution has been neglected. When such a breach occurs, it is still a breach, despite the high reasons of state that may have brought it about. Everett Plywood Corp. v. United States, 227 Ct.Cl. 415, 651 F.2d. 723 (1981). The most that statecraft can demand is that no punitive damages shall be awarded and monetary relief, not specific performance, shall be the remedy. In substance, if not technically, the government has taken the contract and the short word for the aggrieved contractor’s entitlement is just compensation.
The relevancy of this is that on April 2,1971, our plaintiff and the naval shipyard were in this position: implementation of the March 5, 1970, stipulation had proven far more difficult than anyone had anticipated. To remove the crane intact as plaintiff wished to do and supposed it had stipulated for, plaintiff had to send equipment in advance and float it into drydock No. 4, and had to be allowed a working time of 72 hours, what is called in this case a "window.” The drydock in question was in intensive use for its primary function of repairing and refitting major Navy ships. Possible "windows” came in view only rarely between the undocking of one ship and the docking of another. The Navy had designated some "windows” it failed to open *353when the selected time came. Plaintiff had had to reject others and explanation of such rejection was hardly required in view of the arrangements with third parties the Navy knew plaintiff would have to make. The Navy hardly would have expected that such third parties would always be standing by, ready and eager to perform.
Thus, on April 2, 1971, experience had pretty strongly suggested a doubt whether the stipulation could or would ever be performed. The court calls the April 2, 1971, SCO letter an "ultimatum,” a term I think originally suggested from the bench by me. An ultimatum, in international diplomacy, is a demand to which the maker does not expect compliance — and would be disappointed if compliance resulted — but which he means to use as the opening move in all-out war. The eccentric with an interest in history will recall the Austro-Hungarian "ultimatum” to Serbia, after the assassination of the Austrian Archduke, that was the trigger act of World War I. In its more restricted sphere, the SCO letter was an ultimatum. An ultimatum is never resorted to by one in any sphere who hopes that peaceful and cooperative relations will continue, for the obvious reason that even a proper demand becomes unacceptable if it is couched in ultimatum form.
The SCO’s April 2, 1971, letter begins with a one-sided and accusatory recital of relations between the parties, seeking to show (but hardly expecting to convince) that all the delays in implementing the stipulation hitherto have been the fault of plaintiff. It does not mention, of course, that no one even bothered to notify the shipyard commander of the stipulation until the original 90 days had almost run. It does not mention that "window” after "window” was offered to plaintiff and then closed off. Then, in the operative part, it offers one more "window” in the usual terms reserving the right to close it unilaterally, and says if plaintiff does not accept that, or if plaintiff does accept it, but defendant unilaterally decides to close this "window,” there will be no other. Plaintiff will then have to remove its crane by what both sides have recognized to be uneconomic and unfeasible means, or lose it.
We all agree that if, hypothetically, defendant had closed the June 15 window, and refused, as it said it would, any *354other, it would have been in breach, and plaintiff would be entitled to recover breach damages. It seemed to me, until I was persuaded otherwise, that this April 2, 1971, letter was itself a breach and plaintiff would have needed no more. However, we have held in Pauley Petroleum, Inc. v. United States, 219 Ct.Cl. 24, 591 F.2d 1308, cert. denied, 444 U.S. 898 (1979), that a party is not allowed to be trigger-happy in declaring the government in breach. The breach must be real and present, not just feared or threatened. Thus plaintiff should have prepared to make use of the June 15 window, or given notice of good reasons why it could not do so. Plaintiff was not a sovereign nation: it was dealing with the sovereign, and a sovereign with understandable problems.
In any case, a palpable present breach is waived by a failure to declare the contract at an end, and instead a continued effort to perform and benefit by performance. Ling-Temco-Vought, Inc. v. United States, 201 Ct.Cl. 135, 475 F.2d 630 (1973). Thus, a party confronted with a present or threatened breach by the United States has got to take its stance at the proper time, not too soon, and not too late, and in the proper way. Plaintiff, as I read its responses, recognized that friendly and cooperative relations were at an end, and the parties had become adversaries again. But its reactions were those of the squid, not of the forthright contractor who wins breach cases in the Court of Claims. There was a preposterous demand for use of the dock for 90 consecutive days, which, of course, plaintiff never expected to obtain. There was a failure to advise whether plaintiff would or would not use the June 15 "window” that was offered to it. As I see it, the breach claim could have been perfected by a forthright response to the April 2, 1971, letter, in which plaintiff either declared its willingness to use the June 15 window, or else said it could not for reasons stated, and reserved its right to prosecute a breach if the June 15 window were closed and no other provided. The response plaintiff actually made played into defendant’s hands and provided all the excuse needed to let defendant out of its stipulated commitments.
The court has eliminated, and I agree, a number of statements in the trial judge’s recommended opinion, *355intimating or hinting that plaintiffs enthusiasm for getting the crane was superseded at an early date by its enthusiasm at the prospect of another lawsuit. Apart from the fact no one in his right mind welcomes being a party to a lawsuit such as this, I think defendant wanted out of the stipulation at an earlier date than plaintiff, and did its best, and successfully, to jockey or provoke plaintiff into unwise moves that would cost it both lawsuit and crane. Defendant did not forthrightly acknowledge it had stipulated to do something close to impossible for it to do in fact. While one says defendant is liable for breach of the contracts it has gone into the marketplace to make, no matter how high-minded the reasons for the breach, one must also say that under such circumstances, those who would pin breach liability on the government have got to turn square corners.