A-25865, FEBRUARY 19, 1929, 8 COMP. GEN. 455

A-25865: Feb 19, 1929

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CONTRACTS - ACTUAL DAMAGES - DELAYS IN COMPLETION WHERE NO SPECIFIC PROVISION IS MADE IN A CONTRACT FOR EITHER LIQUIDATED OR ACTUAL DAMAGES. THE CONTRACTOR IS. CHARGEABLE WITH ALL EXPENSES CAUSED THE GOVERNMENT BY REASON OF DELAYS IN COMPLETION FOR WHICH NO EXTENSION OF TIME IS PROVIDED. THERE WERE WITHHELD AND DISALLOWED THE SUMS OF $211.40 CHARGED TO AND PAID BY THE GOVERNMENT TO THE CONTRACTOR FOR MEALS FURNISHED GOVERNMENT EMPLOYEES. IT WAS PROVIDED IN THE CONTRACT THAT THE WORK SHOULD BE COMMENCED WITHIN 20 DAYS AFTER RECEIPT BY THE CONTRACTOR OF NOTICE OF APPROVAL OF THE CONTRACT. THE CONTRACTOR WAS NOTIFIED OF THE APPROVAL OF THE CONTRACT ON APRIL 29. WAS DETERMINED AS THE DATE ON WHICH THE CONTRACT WAS TO BE COMPLETED.

A-25865, FEBRUARY 19, 1929, 8 COMP. GEN. 455

CONTRACTS - ACTUAL DAMAGES - DELAYS IN COMPLETION WHERE NO SPECIFIC PROVISION IS MADE IN A CONTRACT FOR EITHER LIQUIDATED OR ACTUAL DAMAGES, THE CONTRACTOR IS, UPON FAILURE TO COMPLETE THE CONTRACT WITHIN THE TIME SPECIFIED THEREIN FOR COMPLETION, CHARGEABLE WITH ALL EXPENSES CAUSED THE GOVERNMENT BY REASON OF DELAYS IN COMPLETION FOR WHICH NO EXTENSION OF TIME IS PROVIDED, AS ACTUAL DAMAGES TO THE GOVERNMENT ON ACCOUNT OF SUCH DELAYS.

DECISION BY COMPTROLLER GENERAL MCCARL, FEBRUARY 19, 1929:

THE MCWILLIAMS DREDGING CO. REQUESTED, DECEMBER 21, 1928, REVIEW OF SETTLEMENT NO. 0192687, DATED NOVEMBER 16, 1928, WHEREIN, FROM THE AMOUNT OF $1,667.49 FOUND TO BE DUE SAID COMPANY AS THE BALANCE UNDER CONTRACT W- 741-ENG. 175, DATED APRIL 7, 1927, COVERING DREDGING IN BEAVER SLOUGH, A SECONDARY CHANNEL OF THE MISSISSIPPI RIVER IN THE VICINITY OF CLINTON, IOWA, THERE WERE WITHHELD AND DISALLOWED THE SUMS OF $211.40 CHARGED TO AND PAID BY THE GOVERNMENT TO THE CONTRACTOR FOR MEALS FURNISHED GOVERNMENT EMPLOYEES, AND $1,034.77 TO COVER INSPECTION AND SUPERINTENDENCE COSTS, DURING THE PERIOD OF DELAY BEYOND THE DATE FIXED BY THE CONTRACT FOR COMPLETING THE WORK THEREUNDER.

IT WAS PROVIDED IN THE CONTRACT THAT THE WORK SHOULD BE COMMENCED WITHIN 20 DAYS AFTER RECEIPT BY THE CONTRACTOR OF NOTICE OF APPROVAL OF THE CONTRACT, AND BE COMPLETED WITHIN THE TIME SPECIFIED IN PARAGRAPH 15 OF THE SPECIFICATIONS. THE CONTRACTOR WAS NOTIFIED OF THE APPROVAL OF THE CONTRACT ON APRIL 29, 1927, AND, BASED ON THE PROVISIONS OF PARAGRAPH 15 OF THE SPECIFICATIONS, DECEMBER 5, 1927, WAS DETERMINED AS THE DATE ON WHICH THE CONTRACT WAS TO BE COMPLETED, BUT DUE TO DELAYS ON THE PART OF THE CONTRACTOR THE WORK WAS NOT COMPLETED UNTIL JUNE 6, 1928. NEITHER THE CONTRACT NOR SPECIFICATIONS PROVIDED FOR THE DEDUCTION OF LIQUIDATED OR CONTAINED ANY SPECIFIC PROVISION WITH REFERENCE TO ACTUAL DAMAGES OR FOR THE CHARGING TO THE CONTRACTOR OF THE COSTS OF INSPECTION AND SUPERINTENDENCE IN THE EVENT THE CONTRACT WORK WAS NOT COMPLETED WITHIN THE TIME AGREED UPON. BUT IT WAS PROVIDED IN PARAGRAPH 39 (A) OF THE SPECIFICATIONS THAT, EXCEPT AS SPECIFIED IN THAT AND THE FOLLOWING PARAGRAPH (NONE OF WHICH EXCEPTIONS ARE HERE MATERIAL), ALL EXPENSES OF INSPECTIONS, SURVEYS, AND SUPERINTENDENCE "PRIOR TO THE DATE FIXED FOR THE COMPLETION OF THE CONTRACT" WOULD BE BORNE BY THE UNITED STATES, THUS INFERENTIALLY, AT LEAST, OBLIGATING THE CONTRACTOR TO BEAR ALL EXPENSES ACCRUING AND BECOMING NECESSARY BY REASON OF DELAYS IN COMPLETION THAT OCCURRED AFTER DATE OF COMPLETION AS FIXED BY THE CONTRACT.

THE CONTRACTOR AGREED TO CARRY ON THE CONTRACT WORK AT A SPECIFIED RATE OF PROGRESS AS SHOWN IN PARAGRAPH 15 OF THE SPECIFICATIONS, AND IF THAT RATE HAD BEEN MAINTAINED THE EXPENSES HERE INVOLVED WOULD NOT HAVE BEEN INCURRED.

AS TO THE DELAY CAUSES, IT IS REPORTED THAT INSTEAD OF THE CONTRACTOR COMMENCING THE WORK WITHIN 20 DAYS FROM DATE OF NOTIFICATION OF APPROVAL OF THE CONTRACT, AS THE CONTRACT PROVIDED, ACTUAL WORK WAS NOT COMMENCED UNTIL ABOUT AUGUST 1, 1927, THE DELAYS BEING STATED AS BEING DUE TO THE USE OF A NEW TYPE OF DIESEL OIL ENGINE DREDGE, THE COMPLETION AND MOVING OF WHICH TO THE SITE OF THE WORK WAS CONSIDERABLY DELAYED BY THE EXTREME HIGH WATER DURING THE SPRING AND SUMMER ON THE LOWER MISSISSIPPI RIVER, AND TO THE INEXPERIENCE OF THE CREW OF THE DREDGE.

NO PROVISION FOR EXTENDING THE CONTRACT TIME BY REASON OF DELAYS OCCURRING DURING THE PERFORMANCE OF THE CONTRACT WORK WAS MADE IN THE CONTRACT OR SPECIFICATIONS, AND EVEN IF SUCH PROVISION HAD BEEN INCORPORATED IN THE CONTRACT THE SPECIFIED CAUSES OF DELAY, BEING DUE SOLELY TO THE CONTRACTOR'S OWN FAULT AS THE FURNISHING OF PROPER EQUIPMENT AND EXPERIENCED CREW WERE OBLIGATIONS VOLUNTARILY ASSUMED, NO RELIEF ON ACCOUNT OF THE DELAYED COMPLETION COULD HAVE BEEN GRANTED NOR WOULD THERE HAVE BEEN ANY AUTHORITY FOR AN EXTENSION OF THE CONTRACT TIME BY REASON OF THE SAID DELAYS.

IN 12 COMP. DEC. 226, IN A CASE WHERE A CONTRACTOR FOR PERFORMING LABOR IN ALASKA BREACHED HIS CONTRACT BEFORE SAME WAS TO EXPIRE, WHICH CONTRACT MADE NO SPECIFIC PROVISION FOR DAMAGES, EITHER LIQUIDATED OR ACTUAL, IT WAS HELD THAT ALL DAMAGES OCCASIONED BY THE CONTRACTOR'S DEFAULT SHOULD BE DEDUCTED FROM THE AMOUNT DUE AT THE TIME HE QUIT WORK, THE DAMAGES SO DEDUCTED TO INCLUDE THE COST TO THE UNITED STATES OF TRANSPORTING HIM TO THE PLACE WHERE HE WAS EMPLOYED. IN SAID DECISION THERE WAS QUOTED FROM THE DECISION IN THE CASE OF LADUE V. SEYMOUR AND WOOD, 24 WEND. 60, AS FOLLOWS:

WHEN A MAN WHO HAS DONE WORK UNDER A SPECIAL CONTRACT, BUT NOT IN CONFORMITY TO IT, EITHER AS TO THE TIME OR MANNER OF EXECUTION, IS ALLOWED TO RECOVER AGAINST A PARTY WHO IS NOT IN FAULT, IT IS THE DUTY OF COURTS AND JURIES TO SEE THAT AN AMPLE ALLOWANCE IS MADE FOR ALL SUCH DAMAGES AS THE DEFENDANT HAS SUSTAINED BY THE DEPARTURE FROM THE CONTRACT. * * * HE CAN NOT, IN ANY EVENT, BE ENTITLED TO MORE THAN THE CONTRACT PRICE; AND FROM THAT MUST BE DEDUCTED ALL THAT THE DEFENDANT HAS LOST BY THE WANT OF A STRICT PERFORMANCE OF THE AGREEMENT. ANY OTHER RULE WOULD ENCOURAGE A LAX MORALITY AND PUNISH ONE MAN FOR THE FAULT OF ANOTHER. * * *

ALSO, IN 3 COMP. GEN. 223 IT WAS SAID THAT UPON A BREACH OF CONTRACT FOR FURNISHING A MACHINE ACCORDING TO CERTAIN SPECIFICATIONS, THE FACT THAT THE CONTRACT CONTAINED NO SPECIFIC PROVISION FOR DAMAGES DOES NOT EXCUSE THE CONTRACTOR FROM LIABILITY FOR THE DIFFERENCE BETWEEN THE CONTRACT PRICE AND THE OPEN-MARKET PRICE PAID BY THE GOVERNMENT TO OBTAIN THE MACHINE ELSEWHERE. SEE, ALSO, DECISIONS A-20069, OF OCTOBER 15, 1927, AND A-25045, OF NOVEMBER 19, 1928, OF THIS OFFICE.

IT APPEARING FROM THE FACTS IN THIS CASE THAT THE DELAYED PERFORMANCE IS ATTRIBUTABLE SOLELY TO THE CONTRACTOR'S OWN FAULT, AND AS, UNDER THE DECISIONS CITED, CONTRACTORS UPON BREACHING THEIR CONTRACTS WITH THE GOVERNMENT ARE CHARGEABLE WITH ALL ACTUAL DAMAGES CAUSED THEREBY, THE CONTRACTOR MUST BE HELD RESPONSIBLE FOR ALL ADDED EXPENDITURES OCCASIONED THE GOVERNMENT BY THE FAILURE TO COMPLETE THE CONTRACT WORK ACCORDING TO THE AGREEMENT. ACCORDINGLY, THE AMOUNTS PAID BY THE GOVERNMENT FOR MEALS FOR ITS EMPLOYEES AND FOR SALARIES AND OTHER EXPENSES OF ITS EMPLOYEES WHILE ENGAGED IN INSPECTING AND SUPERINTENDING THE CONTRACT WORK AFTER THE DATE FIXED BY THE CONTRACT FOR ITS COMPLETION, WERE PROPERLY CHARGED TO THE CONTRACTOR.

UPON REVIEW, THE ACTION TAKEN IN THE SETTLEMENT OF NOVEMBER 16, 1928, MUST BE AND IS SUSTAINED.