A-11587, FEBRUARY 9, 1926, 5 COMP. GEN. 595

A-11587: Feb 9, 1926

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CONSTANT AND HEAVY RAINS ARE A PART OF THE GENERAL HAZARD ASSUMED BY THE CONTRACTOR IN CONNECTION WITH THE PERFORMANCE OF HIS CONTRACT AND ARE NOT TO BE CLASSED AS "ACTS OF GOD. " UNLESS THEY ARE SO ABNORMAL. OF SUCH SEVERITY THAT THEY COULD NOT REASONABLY HAVE BEEN CONSIDERED AS FORESEEABLE SO AS TO BE PROVIDED AGAINST IN THE CONTRACT. CONTAINED A PROVISION THAT LIQUIDATED DAMAGES AS THEREIN STIPULATED WOULD BE DEDUCTED FROM THE CONTRACT PRICE UPON FAILURE OF THE CONTRACTOR TO COMPLETE THE WORK WITHIN THE TIME SPECIFIED UNLESS SUCH DELAYS WERE DUE TO "ACTS OF GOD. THE DEDUCTION OF LIQUIDATED DAMAGES IS NOT EXCUSED FOR PERIODS OF DELAY DUE TO UNUSUAL RAINFALL NOT AMOUNTING TO AN "ACT OF GOD" AS DEFINED BY ESTABLISHED PRECEDENTS IN CONTRACT CASES.

A-11587, FEBRUARY 9, 1926, 5 COMP. GEN. 595

CONTRACTS, LIQUIDATED DAMAGES - DELAYS DUE TO "ACTS OF GOD" IN THE ABSENCE OF THE CONTRACT PROVIDING OTHERWISE, CONSTANT AND HEAVY RAINS ARE A PART OF THE GENERAL HAZARD ASSUMED BY THE CONTRACTOR IN CONNECTION WITH THE PERFORMANCE OF HIS CONTRACT AND ARE NOT TO BE CLASSED AS "ACTS OF GOD," UNLESS THEY ARE SO ABNORMAL, EXTRAORDINARY, OR UNUSUAL, AND OF SUCH SEVERITY THAT THEY COULD NOT REASONABLY HAVE BEEN CONSIDERED AS FORESEEABLE SO AS TO BE PROVIDED AGAINST IN THE CONTRACT. WHERE A CONTRACT, PROVIDING FOR THE CONSTRUCTION OF A BUILDING FOR THE GOVERNMENT ON OR BEFORE A FIXED DATE, CONTAINED A PROVISION THAT LIQUIDATED DAMAGES AS THEREIN STIPULATED WOULD BE DEDUCTED FROM THE CONTRACT PRICE UPON FAILURE OF THE CONTRACTOR TO COMPLETE THE WORK WITHIN THE TIME SPECIFIED UNLESS SUCH DELAYS WERE DUE TO "ACTS OF GOD," ACTS OF THE PUBLIC ENEMY, OR SPECIFIC ACTS OF THE UNITED STATES, THE DEDUCTION OF LIQUIDATED DAMAGES IS NOT EXCUSED FOR PERIODS OF DELAY DUE TO UNUSUAL RAINFALL NOT AMOUNTING TO AN "ACT OF GOD" AS DEFINED BY ESTABLISHED PRECEDENTS IN CONTRACT CASES.

DECISION BY COMPTROLLER GENERAL MCCARL, FEBRUARY 9, 1926:

THE CUNNINGHAM CONSTRUCTION CORPORATION REQUESTED OCTOBER 14, 1925, REVIEW OF SETTLEMENT NO. 092729-W, DATED SEPTEMBER 5, 1925, WHEREIN WAS DISALLOWED THE SUM OF $475.51 OUT OF ITS TOTAL CLAIM FOR REFUND OF $550.51 THERETOFORE DEDUCTED AS LIQUIDATED DAMAGES AND ADDITIONAL COST OF INSPECTION AND SUPERINTENDENCE UPON COMPLETION OF ITS CONTRACT DATED JANUARY 11, 1924, AS AMENDED BY SUBSEQUENT SUPPLEMENTAL AGREEMENTS.

UNDER SAID CONTRACT OF JANUARY 11, 1924, THE CONTRACTOR AGREED TO FURNISH ALL MATERIAL AND EQUIPMENT AND PERFORM ALL LABOR NECESSARY FOR THE CONSTRUCTION OF ONE BARRACK BUILDING AT LANGLEY FIELD, HAMPTON, VA., INCLUDING PLUMBING, HEATING, ELECTRIC WORK, WATER SUPPLY AND ALL OTHER UTILITIES, IN STRICT ACCORDANCE WITH THE SPECIFICATIONS AND DRAWINGS ATTACHED TO AND MADE A PART THEREOF, FOR THE SUM OF $73,749, THE WORK TO BEGIN ON OR BEFORE JANUARY 22, 1924, AND TO BE COMPLETED ON OR BEFORE JULY 9, 1924. SAID CONTRACT WAS MODIFIED BY SUPPLEMENTAL AGREEMENTS, DATED JANUARY 28 AND AUGUST 7, 1924, PROVIDING FOR SPECIFIED CHANGES IN THE WORK CONTRACTED FOR, THEREBY NECESSITATING ADDITIONAL LABOR AND MATERIALS FOR WHICH THE CONTRACTOR WAS TO BE PAID ADDITIONAL COMPENSATION IN THE RESPECTIVE SUMS OF $9,703 AND $1,527.68, AND BY REASON OF WHICH THE TIME OF THE COMPLETION OF THE CONTRACT WAS EXTENDED FROM JULY 9, AS FIXED BY THE ORIGINAL CONTRACT, UNTIL SEPTEMBER 17, 1924.

PROVISIONS FOR THE DEDUCTION OF LIQUIDATED DAMAGES AND OTHER CHARGES WERE MADE IN PARAGRAPHS 15 AND 16 OF THE CONTRACT WHICH READ AS FOLLOWS:

15. FAILURE AND DELAYS OF CONTRACTOR.--- THAT IN CASE OF THE FAILURE OF SAID CONTRACTOR AT ANY TIME TO COMPLY WITH THE STIPULATIONS OF THIS CONTRACT ACCORDING TO THE TRUE INTENT AND MEANING THEREOF (INCLUDING THE REQUIREMENT FOR PROGRESS OF PERFORMANCE TO THE SATISFACTION OF THE OFFICER IN CHARGE, OR HIGHER AUTHORITY), THEN THE UNITED STATES SHALL HAVE THE RIGHT TO PURCHASE THE SUPPLIES ELSEWHERE OR TO COMPLETE THE WORK IN SUCH MANNER AS SHALL BE DEEMED BEST FOR THE INTERESTS OF THE PUBLIC SERVICE AND TO USE FOR THAT PURPOSE THE CONTRACTOR'S MATERIALS AND APPLIANCES ON THE RESERVATION OR AT THE PLACE WHERE THE WORK IS BEING PERFORMED, AND ANY EXCESS OF COST RESULTING FROM SUCH FAILURE, INCLUDING ANY CHARGES ON ACCOUNT OF DELAY SHALL BE CHARGED TO THE CONTRACTOR. THE CONTRACTOR SHALL NOT BE CHARGEABLE WITH ANY DELAY IN THE PERFORMANCE OF THIS CONTRACT DIRECTLY DUE TO ACTS OF GOD, OF THE PUBLIC ENEMY, OR OF SPECIFIC ACTS OF THE UNITED STATES, IN ALL OTHER CASES THE CONTRACTOR SHALL BE CHARGED LIQUIDATED DAMAGES, AS PROVIDED HEREIN, AS WELL AS ANY ADDITIONAL COST OF INSPECTION OR SUPERINTENDENCE, DUE TO SUCH DELAY.

16. LIQUIDATED DAMAGES.--- THE TIME, HEREIN SPECIFIED FOR THE COMPLETE PERFORMANCE OF THIS CONTRACT BEING ONE OF MATERIAL CONSIDERATION INDUCING ITS EXECUTION BY THE GOVERNMENT, AND THE AMOUNT OF DAMAGE WHICH THE GOVERNMENT WILL SUSTAIN IN CASE OF THE FAILURE OF THE CONTRACTOR TO MAKE DELIVERIES OF ARTICLES OR COMPLETE THE WORK HEREIN CONTRACTED FOR WITHIN THE TIME SPECIFIED BEING DIFFICULT OF ASCERTAINMENT, THE PARTIES HERETO HAVE CAREFULLY ESTIMATED THE PROBABLE DAMAGES WHICH THE GOVERNMENT WILL SUFFER BY REASON OF SUCH DELAY, AND IT IS AGREED THAT IN THE EVENT OF SUCH DELAY THE CONTRACTOR SHALL PAY TO THE UNITED STATES AS LIQUIDATED DAMAGES AND NOT AS A PENALTY THE AMOUNTS HEREINAFTER STATED; AND IT IS AGREED THAT SUCH SUMS MAY BE DEDUCTED FROM ANY PAYMENTS TO BE MADE CONTRACTOR, IF THE CONTRACTOR SHALL BE IN UNEXCUSED DEFAULT IN THE DELIVERY OF ARTICLES OR THE COMPLETION OF THE WORK IN STRICT ACCORDANCE WITH THE DATE SET FOR COMPLETION OR THE SCHEDULE OF DELIVERIES SET FORTH HEREIN. SUCH DEDUCTION AS A LIQUIDATION OF DAMAGES SHALL BE AS FOLLOWS:

FIFTEEN ($15) DOLLARS PER DAY FOR EACH AND EVERY CALENDAR DAY BEYOND THE DATE SET FOR COMPLETION.

THE RECORD DISCLOSES THAT THE CONTRACT WAS COMPLETED OCTOBER 18, 1924, OR 31 DAYS AFTER THE DATE FIXED FOR COMPLETION, AND IN MAKING FINAL PAYMENT UNDER THE CONTRACT, THE SUM OF $550.51, WAS WITHHELD FOR LIQUIDATED DAMAGES AND TO COVER THE COST OF INSPECTION AND SUPERINTENDENCE ON ACCOUNT OF THE DELAY IN COMPLETION OF THE CONTRACT FOR WHICH AMOUNT THE CONTRACTOR SUBSEQUENTLY FILED ITS CLAIM. IN SETTLEMENT OF SEPTEMBER 5, 1925, THE CONTRACTOR'S LIABILITY FOR DELAY IN COMPLETION OF THE CONTRACT WAS FIXED AT $475.51 AND REFUND OF $75 TO COVER LIQUIDATED DAMAGES ON ACCOUNT OF FIVE DAYS' DELAY CAUSED BY THE GOVERNMENT WAS AUTHORIZED.

IN REQUESTING REVIEW CLAIMANT ADMITS THAT THERE WERE DELAYS IN COMPLETING THE WORK UNDER THE CONTRACT BUT LIABILITY FOR LIQUIDATED DAMAGES OR OTHER CHARGES THEREUNDER BY REASON OF THE DELAY IS DENIED, IT BEING CONTENDED THAT SAID DELAY WAS DUE (1) TO THE FAILURE OF THE GOVERNMENT TO PROMPTLY FURNISH DETAIL DRAWINGS OF THE MILLWORK TO BE MANUFACTURED; AND (2) TO UNUSUAL WEATHER CONDITIONS CONSTITUTING "ACTS OF GOD.'

CONCERNING THE FIRST CONTENTION, THE EVIDENCE DISCLOSES THAT WHILE THERE WAS A DELAY IN FURNISHING CONTRACTOR WITH CERTAIN DETAIL DRAWINGS OF THE MILLWORK, THE MILLWORK, MANUFACTURED IN ACCORDANCE WITH SAID DRAWINGS, WAS RECEIVED BY THE CONTRACTOR ON THE BUILDING SITE IN AMPLE TIME TO PERMIT THE LAYING OF BRICK, ETC., TO PROCEED IN AN ORDERLY MANNER WITHOUT DELAYING CONTRACTOR. CONSEQUENTLY, SINCE NO DELAY WAS OCCASIONED THE CONTRACTOR ON ACCOUNT OF THE DELAY IN FURNISHING THE DRAWINGS FOR THE MILLWORK, AN EXTENSION OF TIME BY REASON THEREOF IS NOT AUTHORIZED.

RELATIVE TO THE SECOND CONTENTION, THE EVIDENCE DISCLOSES THAT THE RAINFALL AT LANGLEY FIELD, VA., DURING THE MONTHS OF MAY AND JUNE, 1924, WAS IN EXCESS OF THE AVERAGE RAINFALL AT THAT PLACE, THERE HAVING BEEN RAIN OR A TRACE OF RAIN ON 40 DAYS OUT OF SAID PERIOD, AND THE PRECIPITATION HAVING BEEN 9.43 INCHES FOR MAY AND 9.33 INCHES FOR JUNE. BECAUSE THE RAINFALL FOR A 61-DAY PERIOD OF THE 240-DAY PERIOD OF THE CONTRACT WAS ABOVE THE NORMAL OR AVERAGE RAINFALL AT THAT PLACE FOR A FEW PRECEDING YEARS, IT IS URGED THAT IT WAS SO UNUSUAL AND ABNORMAL AS TO CONSTITUTE "ACTS OF GOD" WITHIN THE MEANING OF THE CONTRACT, FOR WHICH NO LIQUIDATED DAMAGES, OR OTHER CHARGES, SHOULD BE CHARGED AGAINST CONTRACTOR. THE CONTRACT PROVIDES THAT ONLY SUCH DELAYS AS MAY BE DIRECTLY DUE TO ACTS OF GOD, OF THE PUBLIC ENEMY, OR OF SPECIFIC ACTS OF THE UNITED STATES, SHALL EXCUSE THE CONTRACTOR FROM ITS FAILURE TO COMPLETE THE WORK THEREUNDER WITHIN THE STIPULATED TIME. IN DECISION OF THIS OFFICE DATED JANUARY 18, 1926 (A-11484), IT WAS SAID, WITH REFERENCE TO A SIMILAR PROVISION IN A CONTRACT, THAT--

THE CONTRACT PROVIDES THAT ONLY SUCH DELAYS AS MAY BE DIRECTLY DUE TO ACTS OF GOD SHALL EXCUSE THE CONTRACTOR FROM ITS FAILURE TO COMPLETE THE WORK WITHIN THE PRESCRIBED TIME. IN OTHER WORDS, THE ACT OF GOD WITHIN THE MEANING OF THE CONTRACT MUST BE THE IMMEDIATE AND EXCLUSIVE CAUSE OF THE DELAY, FREE FROM ALL INTERVENING OR ASSISTIVE CAUSES, BEFORE IT CAN SERVE TO RELEASE THE CONTRACTOR FROM LIABILITY FOR THE DELAY.

IT HAS BEEN HELD THAT:

"* * * THE FOUNDATION OF THE RULE THAT THE ACT OF GOD EXCUSES THE FAILURE TO DISCHARGE A DUTY IS THE MAXIM,"LEX NEMINEM COGIT AD IMPOSSIBILIA.' IF, BY THE USE OF REASONABLE CARE, PRUDENCE, AND DILIGENCE UNDER THE CIRCUMSTANCES OF A PARTICULAR CASE IT IS POSSIBLE TO DISCHARGE THE DUTY, THEN THOSE CIRCUMSTANCES DO NOT CONSTITUTE A VALID EXCUSE FOR A FAILURE TO PERFORM IT. NOTHING LESS THAN SUCH A FORTUITOUS GATHERING OF CIRCUMSTANCES PREVENTING THE PERFORMANCE OF A DUTY AS COULD NOT HAVE BEEN FORESEEN OR OVERCOME BY THE EXERCISE OF REASONABLE PRUDENCE, CARE, AND DILIGENCE CONSTITUTES AN ACT OF GOD WHICH WILL EXCUSE THE DISCHARGE OF THE DUTY. * *" 114 FED.REP. 472; SEE ALSO 189 FED.REP. 471; 17 COMP. DEC. 137.

IT HAS ALSO BEEN HELD THAT:

"THE MOST COMPREHENSIVE DEFINITION OF THE TERM IS ANY ACCIDENT, DUE DIRECTLY AND EXCLUSIVELY TO NATURAL CAUSES WITHOUT HUMAN INTERVENTION, WHICH BY NO AMOUNT OF FORESIGHT, PAINS, OR CARE, REASONABLY TO HAVE BEEN EXPECTED, COULD HAVE BEEN PREVENTED.

"* * * THE PRINCIPLE EMBODIED IN ALL THE DEFINITIONS IS THAT THE ACT MUST BE ONE OCCASIONED EXCLUSIVELY BY THE VIOLENCE OF NATURE AND ALL HUMAN AGENCY IS TO BE EXCLUDED FROM CREATING OR ENTERING INTO THE CAUSE OF THE MISCHIEF. WHEN THE EFFECT, THE CAUSE OF WHICH IS TO BE CONSIDERED, IS FOUND TO BE IN PART THE RESULT OF THE PARTICIPATION OF MAN, WHETHER IT BE FROM ACTIVE INTERVENTION OR NEGLECT, OR FAILURE TO ACT, THE WHOLE OCCURRENCE IS THEREBY HUMANIZED, AS IT WERE, AND REMOVED FROM THE OPERATION OF THE RULES APPLICABLE TO THE ACTS OF GOD. * * *" VOLUME 1, CORPUS JURIS 1174-1175, CITING 69 FED.REP. 773 AND NUMEROUS OTHER AUTHORITIES.

THE GENERAL RULE IS THAT WHEN A PERSON BY HIS CONTRACT CHARGES HIMSELF WITH AN OBLIGATION POSSIBLE TO BE PERFORMED, HE MUST PERFORM IT, UNLESS ITS PERFORMANCE IS RENDERED IMPOSSIBLE BY THE ACT OF GOD, BY THE LAW, OR BY THE OTHER PARTY, IT BEING THE RULE THAT IN CASE THE PARTY DESIRES TO BE EXCUSED FROM PERFORMANCE IN THE EVENT OF CONTINGENCIES ARISING, IT IS HIS DUTY TO PROVIDE THEREFOR IN HIS CONTRACT. HENCE, PERFORMANCE IS NOT EXCUSED BY SUBSEQUENT INABILITY TO PERFORM, BY UNFORESEEN DIFFICULTIES, BY UNUSUAL OR UNEXPECTED EXPENSE, BY DANGER, BY INEVITABLE ACCIDENT, BY THE BREAKING OF MACHINERY, BY STRIKES, BY SICKNESS, BY WEATHER CONDITIONS, BY FINANCIAL STRINGENCY, OR BY STAGNATION OF BUSINESS. NOR IS PERFORMANCE EXCUSED BY THE FACT THAT THE CONTRACT TURNS OUT TO BE HARD AND IMPROVIDENT, OR EVEN FOOLISH, OR LESS PROFITABLE, OR UNEXPECTEDLY BURDENSOME. SEE 13 CORPUS JURIS, 635.

OCCURRENCES WHICH MIGHT REASONABLY HAVE BEEN ANTICIPATED ARE NOT ACTS OF GOD IN THE LEGAL SENSE. SEE GLEESON V. VIRGINIA MIDLAND RAILROAD COMPANY, 140 U.S. 435. CONSTANT AND HEAVY RAINS ARE A PART OF THE GENERAL HAZARD ASSUMED BY A CONTRACTOR IN CONNECTION WITH THE PERFORMANCE OF HIS CONTRACT UNLESS THE CONTRACT PROVIDES OTHERWISE AND ARE NOT TO BE CLASSED AS "ACTS OF GOD," UNLESS SO ABNORMAL, EXTRAORDINARY OR UNUSUAL AND OF SUCH SEVERITY THAT THEY COULD NOT REASONABLY HAVE BEEN CONSIDERED AS FORESEEABLE SO AS TO BE PROVIDED AGAINST IN THE CONTRACT. THERE IS NO EVIDENCE THAT THE RAINFALL AT LANGLEY FIELD, VA., DURING THE 240 DAYS' PERIOD OF THE CONTRACT WAS OF SUCH AN EXTRAORDINARY OR ABNORMAL CHARACTER, OR THAT ANY EXTRAORDINARY RESULTS FOLLOWED IT. EVEN THOUGH THE RAINFALL FOR 40 DAYS, DURING 61 DAYS OF SAID CONTRACT PERIOD, APPEARS TO HAVE BEEN FAIRLY CONSTANT AND UNUSUALLY HEAVY, AND THE PRECIPITATION ABOVE THE NORMAL OF THE AVERAGE RAINFALL FOR THAT TIME OF THE YEAR, IT WAS A COMMON, NATURAL EVENT, SUCH AS NOT ONLY MIGHT HAVE BEEN FORESEEN AS PROBABLE BUT SUCH AS MIGHT HAVE BEEN EXPECTED AND AGAINST WHICH IT WAS THE DUTY OF THE CONTRACTOR TO HAVE GUARDED. AN ACT OF GOD WILL EXCUSE THE FAILURE TO DO A THING WHERE THE LAW CREATED THE DUTY BUT NOT WHERE IT IS CREATED BY THE POSITIVE AND ABSOLUTE CONTRACT OF THE PARTY. WHERE A PARTY BY CONTRACT CREATES A DUTY UPON HIMSELF HE IS BOUND TO MAKE IT GOOD NOTWITHSTANDING THERE MAY ARISE AN UNFORESEEN CONTINGENCY, SUCH AS MIGHT HAVE BEEN PROVIDED AGAINST IN HIS CONTRACT. SEE A-5249, DECISION OF JANUARY 18, 1926M 5 COMP. GEN. 488. THE EVIDENCE DOES NOT ESTABLISH THE RAINFALL HERE IN QUESTION AS BEING SO EXTRAORDINARY AND ABNORMAL AS TO BE CLASSED AS "ACTS OF GOD" WITHIN THE MEANING OF THE CONTRACT. NEITHER DOES IT ESTABLISH THAT SAID RAINFALL WAS THE IMMEDIATE AND EXCLUSIVE CAUSE OF THE DELAY IN COMPLETING THE CONTRACT, FREE FROM ALL INTERVENING OR ASSISTIVE CAUSES.

UNDER THE TERMS OF THE CONTRACT LIQUIDATED DAMAGES MUST BE EXACTED FOR EACH DAY'S DELAY IN COMPLETION BEYOND SEPTEMBER 17, 1924, EXCEPT FOR DAYS OF DELAY THAT WERE DUE TO SPECIFIC ACTS OF THE UNITED STATES. THERE WAS A DELAY OF FIVE DAYS DUE TO AN ERROR IN ONE OF THE DRAWINGS, FOR WHICH THE CONTRACTOR WAS NOT RESPONSIBLE, THUS EXTENDING THE TIME FOR COMPLETION OF THE WORK TO SEPTEMBER 22, 1924. LIQUIDATED DAMAGES THEREFORE ACCRUED AT THE RATE OF $15 PER DAY FOR 26 DAYS, TOTALING $390.

THE EVIDENCE SHOWS THAT THE ADDITIONAL COSTS OF INSPECTION AND SUPERINTENDENCE, DUE TO THE 31 DAYS' DELAY IN COMPLETING THE CONTRACT, AMOUNTED TO $85.51, OF WHICH $12.50 WAS CHARGED FOR THE PERIOD FROM SEPTEMBER 18 TO 22, 1924, LEAVING A BALANCE OF $73.01 CHARGEABLE AGAINST CONTRACTOR ON ACCOUNT THEREOF. THE AGGREGATE AMOUNT CHARGEABLE AGAINST THE CONTRACTOR ON ACCOUNT OF THE DELAY IN COMPLETING THE CONTRACT IS ACCORDINGLY REDUCED TO THE SUM OF $463.01.

UPON REVIEW THE SETTLEMENT IS REVISED AND THERE IS CERTIFIED AS BEING DUE CLAIMANT THE ADDITIONAL SUM OF $12.50, FOR WHICH A SETTLEMENT WILL ISSUE IN DUE COURSE.