B-129877, DEC. 12, 1956

B-129877: Dec 12, 1956

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TO THE SECRETARY OF THE INTERIOR: REFERENCE IS MADE TO A LETTER DATED NOVEMBER 23. BIDS FOR THE PROJECT IN QUESTION WERE SOLICITED BY INVITATION DATED AUGUST 31. THE DIKE TO BE CONSTRUCTED WAS TO CONSIST OF AN EARTHEN CORE APPROXIMATELY 13. THE INVITATION FOR BIDS WAS ACCOMPANIED BY A BIDDING SCHEDULE WHICH INVITED UNIT PRICE BIDS ON 240. THE BIDDING SCHEDULE ADVISED AS FOLLOWS: "THE QUANTITIES GIVEN IN THE FOLLOWING SCHEDULE ARE APPROXIMATIONS FOR COMPARING BIDS AND NO CLAIMS SHALL BE MADE AGAINST THE GOVERNMENT FOR DEFICIENCIES THEREIN. PAYMENT WILL BE MADE FOR THE ACTUAL AMOUNT OF WORK DONE AND WILL BE ON THE BASIS OF THE UNIT PRICES QUOTED.'. AWARD WAS BASED ON THE LOW BID SUBMITTED BY REID CONSTRUCTION COMPANY.

B-129877, DEC. 12, 1956

TO THE SECRETARY OF THE INTERIOR:

REFERENCE IS MADE TO A LETTER DATED NOVEMBER 23, 1956, FROM THE ADMINISTRATIVE ASSISTANT SECRETARY REQUESTING OUR DECISION ON SEVERAL QUESTIONS ARISING IN THE ADMINISTRATION OF CONTRACT NO. 14-19-008-2272 WITH REID CONSTRUCTION COMPANY, INC., FOR CONSTRUCTION OF A DIKE AT BRIGANTINE NATIONAL WILDLIFE REFUGE, OCEANVILLE, NEW JERSEY.

BIDS FOR THE PROJECT IN QUESTION WERE SOLICITED BY INVITATION DATED AUGUST 31, 1954, WHICH DESCRIBED THE WORK AS FOLLOWS:

"CONSTRUCTION OF DIKE AT THE BRIGANTINE NATIONAL WILDLIFE REFUGE, OCEANVILLE, NEW JERSEY, CONSISTING OF EXCAVATION, PLACING AND GRADING APPROXIMATELY 240,000 CUBIC YARDS OF EARTH MATERIAL AND CONSTRUCTION OF APPROXIMATELY 13,174 LINEAR FEET OF DIKE. * * * .'

THE DIKE TO BE CONSTRUCTED WAS TO CONSIST OF AN EARTHEN CORE APPROXIMATELY 13,174 FEET LONG, WITH A TOP WIDTH OF 14 FEET AT ELEVATION 9.0 FEET M.S.L., AND BOTTOM WIDTH OF 48 FEET AT NORMAL MARSH LEVEL, WITH A SURFACING OF MUCK AS A PROTECTIVE COVERING. THE INVITATION FOR BIDS WAS ACCOMPANIED BY A BIDDING SCHEDULE WHICH INVITED UNIT PRICE BIDS ON 240,000 CUBIC YARDS OF HAULED EXCAVATION UNDER ITEM NO. 1 AND ON APPROXIMATELY 13,174 LINEAR FEET OF DIKE TOPPING (SURFACING) UNDER ITEM NO. 2. WITH RESPECT TO QUANTITIES, THE BIDDING SCHEDULE ADVISED AS FOLLOWS:

"THE QUANTITIES GIVEN IN THE FOLLOWING SCHEDULE ARE APPROXIMATIONS FOR COMPARING BIDS AND NO CLAIMS SHALL BE MADE AGAINST THE GOVERNMENT FOR DEFICIENCIES THEREIN, ACTUAL OR RELATIVE. PAYMENT WILL BE MADE FOR THE ACTUAL AMOUNT OF WORK DONE AND WILL BE ON THE BASIS OF THE UNIT PRICES QUOTED.'

AWARD WAS BASED ON THE LOW BID SUBMITTED BY REID CONSTRUCTION COMPANY, INC., IN WHICH THE BIDDER PROPOSED TO PERFORM ALL WORK CONTEMPLATED BY THE INVITATION FOR BIDS AT THE UNIT PRICE OF $0.52 PER CUBIC YARD FOR THE EARTHEN CORE UNDER ITEM NO. 1 AND $0.50 PER LINEAR FOOT FOR THE DIKE TOPPING UNDER ITEM NO. 2 AS SET OUT IN THE BIDDING SCHEDULE. CONTRACT NO. 14-19-008-2272 FOR ,CONSTRUCTION OF DIKE" WAS EXECUTED ON NOVEMBER 2, 1954, FOR A "TOTAL AMOUNT OF $131,387 AS SET FORTH IN ITEMS 1 AND 2 OF THE BIDDING SCHEDULE.' HOWEVER, DUE TO EXCESSIVE SUBSIDENCE OF THE CORE MATERIAL IN THE MARSH ACROSS WHICH THE DIKE WAS BEING CONSTRUCTED, IT BECAME EVIDENT THAT THE ESTIMATED QUANTITY OF HAULED EXCAVATION WAS INSUFFICIENT, AND CHANGE ORDER NO. 1, INCREASING SUCH QUANTITY BY 135,000 CUBIC YARDS WITH A RESULTING INCREASE OF $70,200 OVER THE ORIGINAL CONTRACT PRICE, WAS ISSUED ON MAY 20, 1955. SINCE THE CHANGE ORDER PROVIDED FOR PERFORMANCE OF THE ADDITIONAL WORK AT THE UNIT BID PRICE OF $0.52 PER CUBIC YARD, THE CONTRACTOR REFUSED EXECUTION, CONTENDING THAT THE PROVISIONS OF SECTION 12 OF THE GENERAL CONDITIONS PROHIBITED THE ISSUANCE OF CHANGE ORDERS REQUIRING ADDITIONAL WORK AT UNIT BID PRICES WHERE THE VALUE OF SUCH ADDITIONAL WORK EXCEEDED 25 PERCENT OF THE AGGREGATE COST UNDER THE ORIGINAL ESTIMATE. SINCE THE COST OF PERFORMING THE ADDITIONAL WORK AMOUNTED TO 56.25 PERCENT OF THE ORIGINAL ESTIMATED COST, IT WAS CONTENDED THAT ANY ADDITIONAL WORK SHOULD BE PERFORMED AT A PRICE TO BE DETERMINED UNDER THE FORCE ACCOUNT PROVISIONS OF SECTION 13 OF THE GENERAL CONDITIONS. CONVERSELY, THE CONTRACTING OFFICER CONTENDS THAT CHANGE ORDER NO. 1 CONSTITUTED A REVISION OF ESTIMATES, RATHER THAN AN EXTENSION OF THE CONTRACT WITHIN THE MEANING OF SECTION 12, SINCE THE GOVERNMENT HAD NOT EFFECTED ANY CHANGE IN THE SCOPE OF THE WORK TO BE PERFORMED NOR CHANGED THE PLANS AND SPECIFICATIONS IN ANY WAY, AND THAT SECTION 12 IS THEREFORE INAPPLICABLE. WHILE THE CONTRACTOR AND THE CONTRACTING OFFICER HAVE BEEN UNABLE TO RESOLVE THIS ISSUE, THE CONTRACTOR COMPLETED ALL WORK UNDER ITEM NO. 1, TOTALING 358,245 CUBIC YARDS, AND 40 PERCENT OF THE WORK UNDER ITEM 2, BEFORE APPARENTLY ABANDONING THE PROJECT ON OCTOBER 5, 1956.

IN THESE CIRCUMSTANCES, YOU HAVE SUBMITTED FOR OUR OPINION CERTAIN QUESTIONS AS TO THE APPLICABILITY OF SECTION 12 OF THE GENERAL CONDITIONS, AND THE RESPECTIVE RIGHTS AND OBLIGATIONS OF THE PARTIES.

SECTION 12 OF THE GENERAL CONDITIONS READS AS FOLLOWS:

"SECTION 12--- CHANGES AFTER AWARD OF CONTRACT

NO CHANGE SHALL BE MADE IN THE WORK AS SPECIFIED IN THE PLANS AND/OR SPECIFICATIONS EXCEPT UPON PROPER AUTHORIZATION AS PROVIDED IN THIS SECTION. ANY CHANGE REQUIRED TO BE MADE IN THE PLANS AND/OR SPECIFICATIONS PURSUANT TO CLAUSE 3 OF THE GENERAL PROVISIONS WILL BE AUTHORIZED BY CHANGE ORDER ISSUED BY THE CONTRACTING OFFICER. PAYMENT FOR CHANGES SHALL BE MADE IN ACCORDANCE WITH SECTION 13 OF THESE GENERAL CONDITIONS. SHOULD THE CONTRACTOR MAKE A CHANGE WITHOUT PROPER AUTHORIZATION ANY CORRECTIONS NECESSARY TO COMPLY WITH THE PLANS AND/OR SPECIFICATIONS SHALL BE MADE AT THE CONTRACTOR'S EXPENSE.

"THE GOVERNMENT RESERVES THE RIGHT TO DIRECT THE CONTRACTOR TO PERFORM ADDITIONAL WORK WHICH WAS NOT COVERED IN THE CONTRACT OR ITS SPECIFICATIONS, BUT WHICH IS REASONABLY RELATED THERETO AND WHICH MAY BE A NECESSARY OR DESIRABLE ADDITION TO THE COMPLETED UNIT. SUCH EXTRA WORK SHALL BE MADE IN ACCORDANCE WITH SECTION 13 OF THESE GENERAL CONDITIONS.

"THE GOVERNMENT RESERVES THE RIGHT, IN ORDER TO UTILIZE TO MAXIMUM ADVANTAGE FUNDS AVAILABLE, TO EXTEND THE CONTRACT EITHER BY INCREASING THE QUANTITIES OF WORK TO BE PERFORMED, OR BY EXTENDING THE PROJECT SHOWN IN THE PLANS, OR BY MAKING ADDITIONS OR BETTERMENTS DEEMED DESIRABLE BY THE CONTRACTING OFFICER. THE RIGHT SIMILARLY TO LIMIT THE WORK UNDER THE CONTRACT BY DECREASING THE QUANTITIES OF WORK TO BE PERFORMED OR BY MAKING OTHER ADJUSTMENTS WITHOUT MATERIALLY AFFECTING THE MAIN PURPOSE OF THE PROJECT. THE AFORESAID CONTRACT EXTENSION OR LIMITATION SHALL NOT EXCEED IN AGGREGATE COST 25 PERCENT OF THE AMOUNT ORIGINALLY CONTEMPLATED IN THE CONTRACT. CONTRACT PAYMENTS IN THE EVENT OF A CONTRACT EXTENSION OR LIMITATION AS AFORESAID SHALL BE MADE ON THE BASIS OF UNIT PRICES STATED IN THE CONTRACT, OR, WHEN THE CONTRACT PROVIDES FOR PAYMENT ON A LUMP SUM BASIS, AT PRICES DETERMINED IN ACCORDANCE WITH THE PROVISIONS OF CLAUSE 3 OF THE GENERAL PROVISIONS.' SECTION 13 PROVIDES IN PERTINENT PART AS FOLLOWS:

"SECTION 13--- PAYMENTS FOR CHANGE ORDERS AND EXTRA WORK ORDERS

PAYMENTS FOR WORK PERFORMED UNDER ANY CHANGE ORDER OR EXTRA WORK ORDER ISSUED PURSUANT TO THE PROVISIONS OF SECTION 12, ABOVE, WILL BE MADE ON THE BASIS OF UNIT PRICES STATED IN THE CONTRACT WHERE APPLICABLE. WHENEVER THE SCHEDULE OF UNIT PRICES IN THE CONTRACT DOES NOT APPLY TO ANY ITEMS AUTHORIZED AND DIRECTED IN A CHANGE ORDER OR EXTRA WORK ORDER SUCH ITEMS OF WORK SHALL BE PAID FOR AT A PRICE AGREED UPON IN WRITING BETWEEN THE PARTIES TO THIS CONTRACT BEFORE SUCH WORK IS DONE OR, IN THE EVENT OF FAILURE OF THE PARTIES TO AGREE, ON THE BASIS OF FORCE ACCOUNT IN THE FOLLOWING MANNER: * * * .'

THE RULE IS WELL SETTLED THAT WHERE A CONTRACT PROVIDES FOR THE FURNISHING OF A SPECIFIED QUANTITY OF SUPPLIES OR SERVICES, SUBJECT TO QUALIFYING WORDS SUCH AS "MORE OR LESS," "ABOUT," OR "APPROXIMATELY," AND THERE IS NO SUPPLEMENTAL LANGUAGE FROM WHICH IT MIGHT BE INFERRED THAT THE PARTIES DID NOT INTEND TO BE BOUND BY THE QUANTITIES SPECIFIED, THE QUALIFYING WORDS WILL EXCUSE ONLY MINOR OR ACCIDENTAL VARIATIONS IN QUANTITY. SEE 15 COMP. GEN. 386, CITING MOORE V. UNITED STATES, 196 U.S. 157, AND OTHER CASES. BUT WHERE, AS IN THIS CASE, THE STATEMENT OF QUANTITIES IS ACCOMPANIED BY AN EXPRESS STIPULATION THAT THE QUANTITIES "ARE APPROXIMATIONS FOR COMPARING BIDS AND NO CLAIMS SHALL BE MADE AGAINST THE GOVERNMENT FOR DEFICIENCIES THEREIN, ACTUAL OR RELATIVE," AND THAT "PAYMENT WILL BE MADE FOR THE ACTUAL AMOUNT OF WORK DONE AND WILL BE ON THE BASIS OF THE UNIT PRICES QUOTED," NEITHER THE DESIGNATED QUANTITIES NOR SUCH QUANTITIES WITH SLIGHT VARIATIONS WILL BE REGARDED AS CONTROLLING EXCEPT FOR THE PURPOSE STATED. BRAWLEY V. UNITED STATES, 96 U.S. 168; NATIONAL PUBLISHING CO. V. INTERNATIONAL PAPER CO., 269 F. 903, AND CASES CITED THEREIN; ROYAL PAPER BOX CO. V. E. R. APT SHOE CO., 195 N. E. 96. ITEM 1, SECTION III, OF THE SPECIFICATIONS ACCOMPANYING THE INVITATION FOR BIDS NOTIFIED PROSPECTIVE BIDDERS THAT SETTLEMENT OF THE FILL COULD BE EXPECTED TO OCCUR BELOW THE NATURAL MARSH LINE IN VARYING AMOUNTS, THAT THE SPECIFIED DIMENSIONS OF THE DIKE MUST OBTAIN AFTER SUCH SETTLEMENT, AND THAT PAYMENT WOULD BE MADE AT THE UNIT BID PRICE FOR ALL WORK NECESSARY TO COMPLETE THE DIKE CORE AS SPECIFIED. OBVIOUSLY THE EXACT AMOUNT OF MATERIAL NEEDED TO BUILD A DIKE OF THE SPECIFIED DIMENSIONS COULD NOT BE DETERMINED OR SPECIFIED IN ADVANCE; THE GOVERNMENT'S OBJECTIVE, AND THE SUBJECT MATTER OF THE CONTRACT, WAS THE CONSTRUCTION OF THE DIKE AND FROM THE CLEAR LANGUAGE OF THE INVITATION WE DO NOT SEE HOW IT CAN SERIOUSLY BE CONTENDED THAT THE PARTIES INTENDED THE UNIT BID PRICE TO APPLY ONLY TO THE EXTENT OF THE ORIGINAL ESTIMATE, OR THAT THE APPROXIMATE QUANTITY COULD BE CONSTRUED AS IMPLYING A REPRESENTATION BY THE GOVERNMENT THAT THE REQUIRED CONSTRUCTION COULD BE COMPLETED WITH SUCH AMOUNT OF MATERIAL. UNITED STATES V. BAKER, 50 F.2D 22.

WHILE THE THIRD PARAGRAPH OF SECTION 12 OF THE GENERAL CONDITIONS LIMITS THE AMOUNT OF CERTAIN SPECIFIED CONTRACT EXTENSIONS TO 25 PERCENT OF THE AMOUNT ORIGINALLY CONTEMPLATED UNDER THE CONTRACT, SUCH LIMITATION IS APPLICABLE ONLY TO EXTENSIONS MADE "IN ORDER TO UTILIZE TO MAXIMUM ADVANTAGE FUNDS AVAILABLE.' THE LANGUAGE OF THE CLAUSE IS GENERAL, AND EVIDENTLY WAS INTENDED TO EMBRACE EXTENSIONS OF ANY CONTRACT IN WHICH IT MIGHT BE INCORPORATED, WHETHER THE SUBJECT MATTER OF THE CONTRACT BE WORK AND LABOR OR THE CONSTRUCTION OF A SPECIFIC PROJECT. WE DO NOT BELIEVE THAT THE GENERAL REFERENCE THERE MADE TO INCREASES IN THE QUANTITY OF WORK CAN BE READ AS LIMITING OR QUALIFYING THE SPECIFIC PROVISION THAT PAYMENT FOR THE ACTUAL AMOUNT OF WORK DONE IN THE ACCOMPLISHMENT OF THE PROJECT DEFINED IN THE SPECIFICATIONS AND IN THE ACCOMPLISHMENT OF THE PROJECT DEFINED IN THE SPECIFICATIONS AND DRAWINGS SHOULD BE ON THE BASIS OF THE UNIT PRICES STATED. AS INDICATED ABOVE, THE CONTRACT WAS NOT MERELY TO SUPPLY 240,000 CUBIC YARDS OF EARTHEN CORE, PLUS SURFACING, AT A COST OF $131,387, BUT TO CONSTRUCTA DIKE FOR A PRICE OF $0.52 PER CUBIC YARD OF EXCAVATED MATERIAL USED. IT FOLLOWS THAT CHANGE ORDER NO. 1 DID NOT CONSTITUTE AN INCREASE IN THE QUANTITY OF WORK TO BE PERFORMED UNDER THE CONTRACT, OR AN EXTENSION OF THE PROJECT, OR A DESIRABLE ADDITION OR BETTERMENT, TO WHICH THE 25 PERCENT LIMITATION SET OUT IN SECTION 13 IS DIRECTED. PART (A) OF YOUR FIRST QUESTION--- WHETHER PARAGRAPH 12 IS INAPPLICABLE--- IS ACCORDINGLY ANSWERED IN THE AFFIRMATIVE. IN VIEW OF THIS CONCLUSION IT BECOMES UNNECESSARY TO ANSWER QUESTIONS 2/A) AND 2/B), WHICH ARE PREMISED UPON THE PARAGRAPH BEING APPLICABLE.

WITH RESPECT TO THE QUESTION PRESENTED IN 1/B) AS TO WHETHER THE CONTRACTOR IS REQUIRED TO COMPLETE THE WORK IN THE PERIOD SPECIFIED FOR PERFORMANCE AFTER A PRO RATA EXTENSION BECAUSE OF THE INCREASED AMOUNT OF WORK, CLAUSE 3 OF THE GENERAL PROVISIONS PROVIDES THAT WHERE A CHANGE ORDER CAUSES AN INCREASE IN THE TIME REQUIRED FOR PERFORMANCE AN EQUITABLE ADJUSTMENT SHALL BE MADE AND THE CONTRACT MODIFIED ACCORDINGLY. HOWEVER, BY ADDENDUM NO. 1 DATED SEPTEMBER 24, 1954, TO THE INVITATION FOR BIDS IT WAS PROVIDED THAT "IF SATISFACTORY COMPLETION OF THE CONTRACT SHALL REQUIRE THE PERFORMANCE OF WORK IN GREATER QUANTITIES THAN THOSE ESTIMATED, AS SET FORTH IN THE BIDDING SCHEDULE, THE TIME ALLOWED SHALL BE INCREASED IN THE SAME RATIO THAT THE TOTAL AMOUNT OF THE WORK ACTUALLY PERFORMED SHALL BEAR TO THE QUANTITIES ESTIMATED IN THE BIDDING SCHEDULE.' NOTHING APPEARS IN THE PRESENT RECORD WHICH WOULD SUPPORT A CONCLUSION THAT A PRO RATA EXTENSION BASED ON THE INCREASED QUANTITY OF EXCAVATION REFERRED TO IN CHANGE ORDER 1 WOULD NOT BE EQUITABLE. THE DETERMINATION OF AN "EQUITABLE ADJUSTMENT" IS PRIMARILY A QUESTION OF FACT TO BE DETERMINED BY THE CONTRACTING OFFICER, UNITED STATES V. CALLAHAN WALKER CONSTRUCTION CO., 317 U.S. 56, AND THE CONTRACTOR IS ENTITLED TO APPROPRIATE FINDINGS THEREON. 18 COMP. GEN. 870. HOWEVER, IN THE ABSENCE OF EVIDENCE THAT A PRO RATA EXTENSION OF THE CONTRACT COMPLETION TIME WOULD NOT BE EQUITABLE, IT IS OUR OPINION THAT THERE WOULD BE NO LEGAL JUSTIFICATION FOR A GREATER EXTENSION.

QUESTION (3) ASKS OUR OPINION AS TO WHETHER THE INCREASE IN WORK OVER AND ABOVE THE ORIGINAL ESTIMATE WHICH WAS NECESSARY TO COMPLETE THE PROJECT MAY BE CONSIDERED TO EVIDENCE A CHANGED CONDITION UNDER THE PROVISIONS OF SECTION 4 OF THE GENERAL PROVISIONS WHICH WOULD REQUIRE NEGOTIATION OF THE PRICE AND PERFORMANCE TIME FOR ALL WORK IN EXCESS OF THE ORIGINAL ESTIMATE. WHILE SECTION 4 AUTHORIZES AN EQUITABLE ADJUSTMENT IN THE CONTRACT PRICE AND PERFORMANCE TIME WHERE SUBSURFACE, LATENT, OR UNKNOWN CONDITIONS DIFFER MATERIALLY FROM THOSE INDICATED IN THE CONTRACT OR ORDINARILY ENCOUNTERED AND GENERALLY RECOGNIZED AS INHERING IN WORK OF THE CHARACTER PROVIDED FOR IN THE CONTRACT, IT WOULD APPEAR THAT THE ONLY JUSTIFICATION FOR INVOKING SUCH PROVISIONS IN THE INSTANT CASE WOULD BE THE FACT THAT SUBSIDENCE OF THE CORE MATERIAL EXCEEDED THE ENGINEER'S ESTIMATE. THAT SUBSIDENCE IN VARYING AMOUNTS WAS ANTICIPATED IS DISTINCTLY SET OUT IN SECTION III OF THE SPECIFICATIONS AND, IN THE ABSENCE OF A DEFINITE REPRESENTATION IN THE CONTRACT AS TO THE AMOUNT OF SUBSIDENCE, IT IS OUR OPINION THAT THE CONDITION ENCOUNTERED--- WHICH APPARENTLY HAD NO EFFECT ON THE CHARACTER OR METHOD OF WORK REQUIRED--- DID NOT CONSTITUTE A CHANGED CONDITION WITHIN THE MEANING OF SECTION 4 OF THE GENERAL PROVISIONS. THE ARUNDEL CORPORATION V. UNITED STATES, 103 C.CLS. 688; M. A. BREYMAN DREDGING CO., V. UNITED STATES, 106 ID. 367; 10 COMP. GEN. 557; 19 ID. 1007.

THE LETTER FROM THE ADMINISTRATIVE ASSISTANT SECRETARY ALSO ADVISES THAT AS A RESULT OF STORMS THERE WAS A LOSS OF 7,594 CUBIC YARDS OF HAULED EXCAVATION AT CERTAIN SECTIONS OF THE DIKE, MORE THAN 1,000 FEET BEHIND THE OUTER EDGES OF OPERATIONS, WHICH WERE NOT MUCK SURFACED AT THE TIME OF LOSS, AND THAT SUCH LOSSES WERE CHARGED TO THE CONTRACTOR UNDER THE PROVISIONS OF THAT PORTION OF ITEM 2, SECTION III OF THE SPECIFICATIONS, AS REVISED BY PARAGRAPH 3 OF ADDENDUM NO. 1, READING AS FOLLOWS:

"TO PREVENT LOSS OF HAULED CORE MATERIAL AFTER PLACEMENT DUE TO STORM, THE CONTRACTOR WILL BE REQUIRED TO GRADE CORE FILL, AND PLACE MUCK SURFACING AND ROUGH GRADE WITH DRAGLINE BUCKET NOT TO EXCEED 1,000 FEET BEHIND OUTER END OF OPERATIONS. ANY CORE MATERIALS LOST AFTER PLACEMENT BUT BEFORE FINAL PAYMENT IN EXCESS OF THE 1,000 FEET DUE TO FAILURE TO PLACE SURFACING AS ABOVE SHALL BE REPLACED BY THE CONTRACTOR AT NO COST TO THE GOVERNMENT.'

THE CONTRACTOR CONTENDS THAT THE QUOTED PROVISION MEANS THAT MUCK SURFACING MAY NOT BE PLACED WITHIN 1,000 FEET OF THE OUTER LIMITS OF DIKE CONSTRUCTION AND THAT HE IS THEREFORE LIABLE FOR LOSS ONLY IF SUCH SURFACING IS PLACED LESS THAN 1,000 FEET BEHIND THE OUTER END OF OPERATIONS AND ONLY FOR SUCH PORTIONS OF DIKE LOST ON WHICH MUCK HAS BEEN PLACED.

IT IS UNDERSTOOD FROM INFORMAL ADVICE FROM A MEMBER OF YOUR STAFF THAT IT WAS ORIGINALLY CONTEMPLATED THAT CONSTRUCTION OF THE DIKE SHOULD COMMENCE AT THE SHORELINE, THAT THE CORE SHOULD BE COMPLETED TO SPECIFIED HEIGHT AND WIDTH AS CONSTRUCTION PROGRESSED INTO THE MARSH, AND THAT SURFACING SHOULD BE APPLIED TO THE COMPLETED CORE AS THE WORK PROGRESSED TO BE THE NATURAL INTERPRETATION OF THE QUOTED PROVISION. UNDER SUCH METHOD OF CONSTRUCTION IT IS CLEAR THAT THE CONTRACTOR WAS OBLIGATED BY THE PROVISION OF THE SPECIFICATION IN QUESTION TO REPLACE ANY STORM DAMAGE TO THE COMPLETED BUT UNSURFACED CORE WHICH OCCURRED MORE THAN 1,000 FEET BEHIND THE POINT AT WHICH HE WAS CURRENTLY CONSTRUCTING THE CORE. HOWEVER, DUE TO THE LARGE AMOUNT OF SUBSIDENCE, THE CONTRACTOR WAS AUTHORIZED, APPARENTLY INFORMALLY, TO CONSTRUCT A PARTIALLY COMPLETED CORE, WITHOUT REGARD TO HEIGHT AND WIDTH, TO THE FULL LENGTH OF THE DIKE AND TO COMPLETE THE CORE AND APPLY THE SURFACING FROM THE OUTER END TOWARD THE SHORE. UNDER THIS METHOD OF CONSTRUCTION A LITERAL APPLICATION OF THE SPECIFICATION PROVISION WOULD RESULT IN HOLDING HIM RESPONSIBLE FOR ANY STORM DAMAGE WHICH MIGHT OCCUR IN THE ENTIRE 13,174 FEET OF UNCOMPLETED CORE. SINCE THE CONTRACTOR WOULD HAVE INCURRED NO LIABILITY FOR DAMAGE TO THE UNCOMPLETED CORE IF HE HAD BEEN REQUIRED TO CONSTRUCT THE CORE IN THE MANNER ORIGINALLY CONTEMPLATED IT IS OUR OPINION--- ON THE BASIS OF THIS INFORMATION--- THAT THE APPARENT WAIVER BY THE GOVERNMENT OF THE SPECIFICATION REQUIREMENT AS TO SURFACING MUST BE CONSTRUED AS A WAIVER ALSO OF THE CONTRACTOR'S OBLIGATION TO REPLACE LOST MATERIAL, AND THAT THE CONTRACTOR MAY NOT NOW BE HELD LIABLE FOR STORM DAMAGE TO THE UNCOMPLETED CORE WHICH MAY BE ATTRIBUTABLE TO THE PERMITTED CHANGE IN METHODS. SEE DISTRICT OF COLUMBIA V. CAMDEN IRON WORKS, 181 U.S. 453; GEO. A. FULLER CO. V. B.P. YOUNG CO., 126 F. 343; 12 AM. JUR. 920-921. ..END :