B-4561, JULY 13, 1939, 19 COMP. GEN. 55

B-4561, JULY 13, 1939, 19 COMP. GEN. 55

CONTRACT - DAMAGES - ACTUAL - EXPENDITURES RESULTING DIRECTLY FROM CONTRACTOR'S BREACH OF CONTRACT WHERE A CONTRACTOR FAILS, BECAUSE OF HEAVY RAINFALL CONDITIONS, TO COMPLY WITH THE TERMS OF HIS CONTRACT FOR " WATER; FILTERED, SUITABLE FOR DOMESTIC PURPOSES. WATER TO BE FURNISHED IN QUANTITY AND PRESSURE AS REQUIRED, * * *," IT IS CHARGEABLE, IN THE ABSENCE OF CONTRACT PROVISIONS TO THE CONTRARY, WITH THE EXPENDITURES NECESSARILY MADE BY THE GOVERNMENT AS A DIRECT RESULT OF THE FAILURE.

COMPTROLLER GENERAL BROWN TO THE ADMINISTRATOR OF VETERANS' AFFAIRS, JULY 13, 1939:

THERE WAS RECEIVED YOUR LETTER OF JUNE 24, 1939, AS FOLLOWS:

I SUBMIT HEREWITH FOR YOUR ADVICE THE QUESTION WHAT, IF ANY, DEDUCTIONS SHOULD BE MADE FROM THE WATER BILL FOR THE MONTH OF MARCH 1939, SUBMITTED TO VETERANS' ADMINISTRATION FACILITY, DANVILLE, ILLINOIS, BY THE INTER- STATE WATER COMPANY UNDER CONTRACT VA-13IH 627. SAID COMPANY CONTRACTED TO FURNISH:

"WATER; FILTERED, SUITABLE FOR DOMESTIC PURPOSES. WATER TO BE FURNISHED IN QUANTITY AND PRESSURE AS REQUIRED, AND TO BE DELIVERED TO THE METERS OF THE VETERANS' ADMINISTRATION FACILITY, DANVILLE, ILLINOIS, FOR THE PERIOD BEGINNING JULY 1, 1937 UNTIL FURTHER NOTICE.

ON MARCH 13, 1939, THE MANAGER, VETERANS' ADMINISTRATION FACILITY, DANVILLE, ILLINOIS, FORWARDED A LETTER TO DIRECTOR OF CONSTRUCTION, VETERANS' ADMINISTRATION, WASHINGTON, D.C., FROM WHICH THE FOLLOWING IS QUOTED:

"OVER FRIDAY AND SATURDAY OF LAST WEEK WE HAD A VERY HEAVY RAIN IN THIS VICINITY, AND THIS RAIN CONTINUED FOR ABOUT TWENTY-SIX HOURS, CAUSING CONSIDERABLE FLOOD DAMAGE IN THIS VICINITY ALTHOUGH THIS FACILITY WAS NOT MATERIALLY HARMED IN ANY WAY.

"HOWEVER, DUE TO WATER MAIN TROUBLE, WE HAD CONSIDERABLE DIFFICULTY OVER SATURDAY NIGHT AND SUNDAY WITH OUR PRESSURE, WHICH GOT AS LOW AS 10 LBS., AND IT WAS NECESSARY FOR US TO CARRY WATER TO THE UPPER FLOOR OF BUILDING NO. 58 IN ORDER TO FLUSH TOILETS. LATER ON SUNDAY, WE RECEIVED WORD THAT THE ENTIRE WATER SYSTEM OF THE CITY WAS POLLUTED, AND IT WAS NECESSARY FOR US TO CALL OUT OUR CREW AND CUT OFF WATER FOUNTAINS, AND ARRANGE TO BOIL ALL DRINKING WATER, AND MAINTAIN A SUPPLY OF SAME IN VARIOUS WARDS IN G.I. CANS.

"DURING THE NIGHT OF SATURDAY THE LAKE ROSE TO SUCH A LEVEL THAT WATER WAS FLOWING ACROSS ABOUT 100 FEET OF THE EARTHFILLED DAM, AND 6 INCHES MORE WOULD HAVE COVERED THE ENTIRE DAM FROM END TO END.'

ON MAY 25, 1939, THE SOLICITOR, VETERANS' ADMINISTRATION, WASHINGTON, D.C., REQUESTED THE MANAGER AT DANVILLE TO SUBMIT A FURTHER REPORT RELATIVE TO THE RAINFALL AND THE RESULTING DAMAGE. PHOTOSTATIC COPY OF THE MANAGER'S REPLY DATED JUNE 3, 1939, IS ENCLOSED HEREWITH. ALSO ENCLOSED HEREWITH ARE PHOTOSTATIC COPY OF LETTER DATED APRIL 3, 1939, ADDRESSED BY THE MANAGER AT DANVILLE TO DIRECTOR OF CONSTRUCTION, VETERANS' ADMINISTRATION, WASHINGTON, D.C., AND PHOTOSTATIC COPY OF COPY OF THE WATER BILL REFERRED TO THEREIN.

IT IS A WELL ESTABLISHED PRINCIPLE OF LAW THAT WHEN A CONTRACT IS BREACHED BY ONE OF THE PARTIES THERETO AND THE OTHER PARTY SUFFERS DAMAGE AS A RESULT, THE PARTY SO SUFFERING, IN THE ABSENCE OF CONTRACT PROVISIONS TO THE CONTRARY, IS ENTITLED TO RECOVER HIS ACTUAL DAMAGES.

IN THE INSTANT CASE IT WOULD APPEAR THAT THE GOVERNMENT HAS SUFFERED CERTAIN ACTUAL DAMAGES FOR WHICH IT SHOULD BE COMPENSATED, BUT IT IS NOT CLEAR FROM YOUR SUBMISSION THAT THE GOVERNMENT PROPERLY MAY REQUIRE REIMBURSEMENT FROM THE CONTRACTOR FOR ALL OF THE EXPENDITURES WHICH ARE REPORTED TO HAVE BEEN OCCASIONED BY REASON OF THE CIRCUMSTANCES BROUGHT ABOUT BY THE FLOOD. FOR INSTANCE, IT WOULD SEEM FROM THE CONTENTS OF THE LETTER DATED JUNE 3, 1939, OF THE MANAGER OF YOUR FACILITY, THAT THE CHLORINATOR WHICH WAS PURCHASED WAS NOT ACTUALLY INSTALLED UNTIL AFTER THE WATER WHICH WAS THEN BEING FURNISHED BY THE CONTRACTOR HAD BEEN CERTIFIED BY THE STATE HEALTH AUTHORITIES AS FIT FOR DRINKING PURPOSES. ALSO, AS TO CERTAIN OTHER ITEMS, SUCH AS THE COST OF PROCURING SATISFACTORY WATER AND THE EXPENDITURE WHICH IS REPORTED TO HAVE BEEN MADE FOR VACCINE, IT IS NOT SHOWN WHETHER THEY REPRESENT EXPENDITURES ACTUALLY NECESSARY BY REASON OF THE BREACH OF THE CONTRACT.

ON THE PRESENT RECORD, I CANNOT ADVISE YOU MORE DEFINITELY THAN TO STATE THAT THE AMOUNT TO BE DEDUCTED FROM THE CONTRACTOR'S BILL FOR WATER FURNISHED IS THE TOTAL AMOUNT OF THE EXPENDITURES NECESSARILY MADE AS A DIRECT RESULT OF THE FAILURE OF THE CONTRACTOR TO FURNISH, DURING THE PERIOD INVOLVED, THE WATER SERVICE REQUIRED UNDER THE CONTRACT.