Court Opinion

ID: 9702528
Source: CourtListenerOpinion
Date Created: 2023-08-25 23:15:19.519302+00
Date Added: 2024-06-11T18:20:13.094546
License: Public Domain

LITTLETON, Judge
(dissenting in part).
I dissent as to the allowance of any part of the sum of $4,660.83 (finding 13) on account of increased wages.
*783In support of their claim for the recovery of these increased wages plaintiffs insist that section 12, Division 1, of the specifications and article 18(a) of their contract (finding 5) fixed the wages that they were to pay under the contract and that, by article 19(a), the Government agreed to reimburse them by adjustment of the contract price in the event the Administrator of Public Works established different wage rates. They further insist that the Administrator did establish higher wage rates within the meaning of the provisions of the contract and specifications mentioned. I cannot agree. The wages specified in plaintiffs’ contract were minimum rates only. Article 19(a) of the contract and paragraph 4 of section 12 of the specifications contemplated, I think, that the Government would increase plaintiffs’ contract price only in the event the Administrator established greater minimum wage rates under their contract and directed them to pay wages at such increased rates. The “project,” referred to in art. 19(a), was the foundation work and not the buildings which the Government might, under another contract, erect thereon. Each P. W. A. contract made was given a project number, and plaintiffs’ contract was “Project No. H-1405.” The Administrator did not establish greater minimum wage rates under plaintiffs’ contract nor on the “project” covered thereby, nor did he direct or otherwise directly force them to pay any increased wages. He did nothing except what he had a perfect legal right to do so far as plaintiffs’ contract was concerned. Perhaps he should not have advertised for another contract at higher minimum wages, which would result in a higher bid price to the Government, until plaintiffs had finished their contract which was closely related to the new work, but this was not a breach of any express or necessarily implied provision of their contract and cannot be made the basis of a claim for reimbursement under art. 19(a). Dravo Corporation v. United States, 93 Ct.Cl. 734. Moreover, section 12 of the specifications provided that the Government would not consider any claims for additional compensation because of payment by the contractor of any wage rate in excess of the applicable rate contained therein, and that all disputes with labor in regard to payment of wages in excess of those specified “shall be adjusted by the contractor.” This provision appears to have contemplated an event such as actually happened, i. e., a strike for higher wages.
The minimum wage rates set forth in plaintiffs’ contract were fixed by the Administrator of Public Works in the invitation for bids and specifications for the particular project covered by that contract under the Rules and Regulations approved by the President December 26, 1934, issued under authority of section 209, Title II of the National Industrial Recovery Act, and Executive Order No. 6929, which Regulations, so far as material here, were as follows:
“Whereas, the President, by Executive Order No. 6929, of December 26, 1934, has delegated to the Federal Emergency Administrator of Public Works the power * * * to prescribe new rules and regulations * * * I hereby prescribe the following rules and regulations under the authority of the said section 209 as necessary to carry out the purposes of said Act, which rules and regulations shall apply to all projects constructed in whole or in part under Title II of said Act: * * *
“3. Wages. The wages paid to employees directly employed on any such project shall not be less than the applicable minimum wage rates which the Administrator may fix from time to time. Should it appear that any individual employed on any such project has been or is being paid less than the minimum wage fixed by the Administrator and in force at the time such labor was performed, the employer of such individual shall be notified to pay him all wages due according to the prescribed rate. Upon ten days’ default on the part of any such employer after the receipt of such notice he shall be subject to the penalties provided in said Act for violation of these regulations.”
The actual increased wages of $4,321, which plaintiffs incurred, were incurred and paid as a direct result of a demand and strike of their Union employees. Except for this, plaintiffs would not have been required by the Administrator, or otherwise, to pay any increased wages. Defendant did not request plaintiffs to increase the wage rates and no one representing the Government or the Administrator participated in the dispute between plaintiffs and the labor unions. The fact that the labor unions of the Chicago territory may have failed to abide by their wage agreement with the Building Trade Employers’ Association, of *784which plaintiffs were members, cannot be made the basis of a claim for reimbursement against the Government. Nor can the Government be held liable to plaintiffs for reimbursement of the increased wages which they were compelled to pay under the circumstances, because the Government on February 15, 1936, issued invitations for bids and specifications for another contract on another and a different project for the buildings to be constructed on the foundations covered by plaintiff’s contract in which minimum wage rates higher than those contained in plaintiffs’ contract were specified. The provisions of plaintiffs’ contract did not expressly cover such a situation, and the language used in art. 19(a) and paragraph 12 of the specifications cannot be so extended as to include it by implication. LeVeque et al. v. United States, 96 Ct.Cl. 250; Hood & Gross v. United States, 90 Ct.Cl. 258, 265; Barnes v. United States, 92 Ct.Cl. 32, 43, 44. Cf. Blair v. United States, 321 U.S. 730, 64 S.Ct. 820, 88 L.Ed. 1039.
Art. 15 of the contract made the decisions of the contracting officer and the head of the department final on such questions. They both considered and rendered adverse decisions on the question whether the Administrator had established different wage rates in such a way as to require reimbursement to plaintiffs for the increased wages which they paid. This was clearly a “dispute concerning questions arising under this contract” and their decisipns were final under the express agreement of the parties. These decisions were clearly not arbitrary, and they were clearly not so grossly erroneous as to imply bad faith. We cannot, therefore, ignore them. Ripley v. United States, 220 U.S. 491, 31 S.Ct. 478, 55 L.Ed. 557; Id., 222 U.S. 144, 147, 32 S.Ct. 60, 56 L.Ed. 131; Id., 223 U.S. 695, 696, 701, 702, 32 S.Ct. 352, 56 L.Ed. 614; Burchell v. Marsh, 17 How. 344, 349, 350, 15 L.Ed. 96.
Defendant makes the contention that plaintiffs did not appeal from the decision of the contracting officer to the head of the department. This contention appears to be based on the assumption that the Assistant Administrator was the contracting officer. Plaintiffs did appeal, and within time. Under the contract provisions the Director of Housing, A. R. Clas, was the contracting officer, as the Assistant Administrator stated in his decision of June 29, 1926. The Assistant Administrator of Public Works, Horatio B. Hackett, although he signed the contract, was the head of the department within the meaning of the contract as defined by article 28(a). He was duly authorized to act for the Administrator and he did so act with reference to approval of change orders and consideration and decisions of appeals.
Plaintiffs make the alternative claim that even if their claim for reimbursement of the increased wages, as such, should be denied they should have judgment for at least $909 on account of such wages (they claim the amount should be $1,856.08) under the findings and recommendations of the Assistant Administrator in his letters of June 29 and August 12, 1936, to plaintiffs and in the letter of the Administrator of May 20, 1937, to the Comptroller General (finding 18). These officials decided in connection with plaintiffs’ claims for extra costs that the expenses necessarily incurred by plaintiffs, including a portion of the increased wages, as a result of the stoppage and suspension of their work from December 10, 1936, to February 17, 1937, in connection with changes could not be allowed by them as an increase in the contract price a's a part of an equitable adjustment under art. 3 of the contract in connection with the change order. This position appears to have been taken because of certaiñ rulings of the Comptroller General. See 7 Comp.Gen. 645; 12 Comp. Gen. 179, 227. They therefore made findings with reference to the amounts and the cause of these expenses, and recommended to the Comptroller General that certain amounts be paid. While these findings and recommendations should be given great weight if the items covered thereby are found by the Court to be allowable, either under the contract or as damages for a breach thereof, they are not such decisions as are made final and conclusive by art. 15 for such purposes. The evidence of record does not warrant a finding by the Court that of the total increased wages paid by plaintiffs the amount of $1,556.06, or $909 thereof, was incurred as a result of delay due to suspension of the work for 69 days in connection with the change under the contract as mentioned in the findings.
I think judgment should be entered in favor of plaintiffs for only $8,727.44.
JONES, Judge, took no part in the decision of this case.