B-50425, OCTOBER 9, 1945, 25 COMP. GEN. 332

B-50425: Oct 9, 1945

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CONTRACTS - DAMAGE TO CONSTRUCTION WORK PRIOR TO ACCEPTANCE - LIABILITY FOR REPLACEMENT THE FACT THAT A CONSTRUCTION PROJECT WAS SUBSTANTIALLY COMPLETED AND OCCUPIED BY THE GOVERNMENT WHEN THE PROPERTY WAS DAMAGED PRIOR TO FINAL ACCEPTANCE MAY NOT BE CONSIDERED AS RELIEVING THE CONTRACTOR OF ITS CONTRACTUAL RESPONSIBILITY FOR "ALL MATERIALS AND WORK PERFORMED UNTIL COMPLETION AND FINAL ACCEPTANCE. - IN THE EVENT SUCH DAMAGE OR DESTRUCTION WAS CAUSED BY AN ACT OF THE CONTRACTOR OR BY SOME OCCURRENCE BEYOND THE CONTROL OF EITHER PARTY. THE WORK PERFORMED BY A CONSTRUCTION CONTRACTOR PURSUANT TO AN EXPRESS AGREEMENT IN REPLACING PROPERTY DAMAGED BY THE NEGLIGENCE OF A GOVERNMENT EMPLOYEE MAY NOT BE REGARDED AS "EXTRA WORK" OR WORK "DUE TO CHANGES IN THE DRAWINGS OR SPECIFICATIONS" WHICH THE CONTRACTOR WAS OBLIGATED TO PERFORM UNDER THE ORIGINAL CONTRACT PROVISIONS.

B-50425, OCTOBER 9, 1945, 25 COMP. GEN. 332

CONTRACTS - DAMAGE TO CONSTRUCTION WORK PRIOR TO ACCEPTANCE - LIABILITY FOR REPLACEMENT THE FACT THAT A CONSTRUCTION PROJECT WAS SUBSTANTIALLY COMPLETED AND OCCUPIED BY THE GOVERNMENT WHEN THE PROPERTY WAS DAMAGED PRIOR TO FINAL ACCEPTANCE MAY NOT BE CONSIDERED AS RELIEVING THE CONTRACTOR OF ITS CONTRACTUAL RESPONSIBILITY FOR "ALL MATERIALS AND WORK PERFORMED UNTIL COMPLETION AND FINAL ACCEPTANCE," OF ITS OBLIGATION TO REPAIR OR REPLACE, AT ITS OWN EXPENSE, ANY MATERIALS DAMAGED "BY ANY CAUSE OR MEANS WHATSOEVER," OR OF ITS OBLIGATION TO DELIVER THE ENTIRE STRUCTURE COMPLETE AND UNDAMAGED, SO AS TO ESTOP THE GOVERNMENT FROM DENYING THAT IT ACCEPTED THE RISKS INCIDENT TO THE CONTROL, USE OR OCCUPANCY OF THE PROPERTY. COMP. GEN. 876, DISTINGUISHED. THE LIABILITY PLACED UPON A CONSTRUCTION CONTRACTOR BY THE TERMS AND CONDITIONS OF ITS CONTRACT TO ASSUME THE RISK OF DAMAGE TO OR DESTRUCTION OF THE PROPERTY--- OCCURRING AT ANY TIME PRIOR TO ITS FINAL INSPECTION AND ACCEPTANCE BY THE GOVERNMENT--- IN THE EVENT SUCH DAMAGE OR DESTRUCTION WAS CAUSED BY AN ACT OF THE CONTRACTOR OR BY SOME OCCURRENCE BEYOND THE CONTROL OF EITHER PARTY, DOES NOT EXTEND TO A SITUATION WHERE THE DAMAGE RESULTED SOLELY FROM A NEGLIGENT ACT OF A GOVERNMENT EMPLOYEE ACTING WITHIN THE SCOPE OF HIS EMPLOYMENT. WHERE A CONSTRUCTION CONTRACT HAS BEEN COMPLETED AND FINAL PAYMENT HAS BEEN MADE THERE NO LONGER EXISTS A CONTRACT WHICH LEGALLY MAY BE MODIFIED OR AMENDED, AND, THEREFORE, A CHANGE ORDER, AN ORDER FOR EXTRA WORK, OR A SUPPLEMENTAL CONTRACT MAY NOT SUBSEQUENTLY BE ISSUED TO REIMBURSE THE CONTRACTOR FOR ADDITIONAL WORK NOT CONTEMPLATED BY THE ORIGINAL CONTRACT IN RESTORING PROPERTY DAMAGED BY THE NEGLIGENCE OF A GOVERNMENT EMPLOYEE PRIOR TO FINAL ACCEPTANCE. THE WORK PERFORMED BY A CONSTRUCTION CONTRACTOR PURSUANT TO AN EXPRESS AGREEMENT IN REPLACING PROPERTY DAMAGED BY THE NEGLIGENCE OF A GOVERNMENT EMPLOYEE MAY NOT BE REGARDED AS "EXTRA WORK" OR WORK "DUE TO CHANGES IN THE DRAWINGS OR SPECIFICATIONS" WHICH THE CONTRACTOR WAS OBLIGATED TO PERFORM UNDER THE ORIGINAL CONTRACT PROVISIONS, AND, THEREFORE, PAYMENT FOR SUCH WORK--- BEING SEPARATE AND APART FROM THE ORIGINAL CONTRACT--- IS CHARGEABLE TO THE APPLICABLE FISCAL YEAR APPROPRIATION CURRENT WHEN THE AGREEMENT WAS ENTERED INTO AND NOT TO THE FISCAL YEAR APPROPRIATION CURRENT AT THE TIME THE ORIGINAL CONTRACT WAS ENTERED INTO.

COMPTROLLER GENERAL WARREN TO THE SECRETARY OF THE INTERIOR, OCTOBER 9, 1945:

REFERENCE IS MADE TO YOUR LETTER OF JUNE 9, 1945, AS FOLLOWS:

BEFORE " PAYMENT NO. 3--- FINAL PAYMENT" WAS MADE UNDER CONTRACT I 28P- 1307, FOR THE CONSTRUCTION OF THE SHERWOOD PLAYGROUND SHELTER HOUSE, THE FURNACE BOILER INSTALLED THEREIN WAS DESTROYED BY AN ACT OF AN EMPLOYEE OF THE NATIONAL PARK SERVICE OF THIS DEPARTMENT. THE SHELTER HOUSE WAS SUBSTANTIALLY COMPLETED AUGUST 30, 1944, AND IT WAS PUT IN USE BY THE NATIONAL PARK SERVICE ON THAT DAY. DUE TO THE INABILITY OF THE CONTRACTOR TO OBTAIN RADIATORS, THE HEATING SYSTEM WAS NOT COMPLETED UNTIL OCTOBER. AFTER INSTALLATION OF THE RADIATORS, THE TESTING OF THE HEATING SYSTEM, PROVIDED FOR IN PARAGRAPH 178 OF THE SPECIFICATIONS, HAD TO BE POSTPONED BECAUSE THE NATIONAL PARK SERVICE HAD NOT INSTALLED THE WATER SUPPLY LINE INTO THE BUILDING.

AT THE TIME OF THE OCCUPANCY OF THE BUILDING AND BEFORE THE INSTALLATION OF THE RADIATORS, THE CARETAKER AT SHERWOOD, AN EMPLOYEE OF THE NATIONAL PARK SERVICE, HAD BEEN TOLD BY THE NATIONAL PARK SERVICE ENGINEER IN CHARGE NOT TO BUILD A FIRE IN THE BOILER. ON OCTOBER 20, A VERY COLD DAY, THE CARETAKER, OBSERVING THAT THE RADIATORS HAD BEEN INSTALLED AND BELIEVING THAT THE HEATING SYSTEM WAS READY FOR USE, AND NOT HAVING RECEIVED ANY FURTHER INSTRUCTIONS ABOUT THE MATTER SINCE AUGUST 30, BUILT A FIRE TO WARM UP THE BUILDING. SINCE THERE WAS ONLY A SMALL AMOUNT OF WATER IN THE HEATING SYSTEM, THE BOILER WAS DESTROYED.

THE PARK SERVICE ENGINEERS, ON BEHALF OF THE CONTRACTING OFFICER, REACHED AN AGREEMENT WITH THE CONTRACTOR THAT HE SHOULD REPLACE THE DESTROYED BOILER AND REPAIR THE DAMAGES ON AN ACTUAL COST BASIS AND THEY AGREED THAT A CHANGE ORDER WOULD BE ISSUED TO COVER THE INCREASE IN THE CONTRACT PRICE IN THE AMOUNT OF SUCH REPAIRS AS SOON AS RESTORATION WAS MADE AND THE COST THEREOF COULD BE DETERMINED. IN THIS CONNECTION, SEE ENCLOSED COPY OF A LETTER DATED NOVEMBER 2, 1944, FROM THE CONTRACTOR TO THE CONTRACTING OFFICER AND ITS ENCLOSURE, A MEMORANDUM OF NOVEMBER 1, 1944, SIGNED BY SUBCONTRACTOR MCCREA. AFTER THE COMPLETION AND ACCEPTANCE OF THE RESTORATION WORK, THE CERTIFYING OFFICER FOR NATIONAL CAPITAL PARKS QUESTIONED THE ISSUANCE OF A CHANGE ORDER TO COVER THE COST THEREOF ON THE GROUNDS THAT NO CHANGES IN SPECIFICATIONS OF THE CONTRACT WERE INVOLVED. THE COST OF THE REPAIRS TO THE HEATING SYSTEM CAUSED BY THE FIRE AMOUNT TO $405.36.

CONSIDERATION HAS BEEN GIVEN YOUR DECISION OF APRIL 7, 1936, 15 COMP. GEN. 876. IN VIEW OF YOUR DECISION IN THAT CASE, THIS DEPARTMENT FEELS THAT UNDER THE CIRCUMSTANCES OF THE INSTANT CASE, THE RISK OF LOSS DUE TO AN ACT OF A GOVERNMENT EMPLOYEE HAD BEEN SHIFTED TO THE GOVERNMENT. THE GOVERNMENT HAD TAKEN POSSESSION OF THE BUILDING AND PUT IT TO USE ON AUGUST 30, 1944. BY OCTOBER 20, 1944, THE DAY THE CARETAKER BUILT THE FIRE IN THE FURNACE, THE CONTRACTOR HAD PERFORMED ALL THE WORK REQUIRED UNDER THE CONTRACT, INCLUDING THE CORRECTION OF MINOR DEFECTS AND OMISSIONS, AND THE GOVERNMENT HAD HAD THE BENEFICIAL USE OF THE BUILDING FOR NEARLY TWO MONTHS. MOREOVER, THE ONLY REASON THE FURNACE HAD NOT BEEN TESTED WAS DUE TO THE FACT THAT THE GOVERNMENT HAD FAILED TO PROVIDE THE NECESSARY WATER CONNECTION. IN THESE CIRCUMSTANCES, IT IS BELIEVED THAT THE GOVERNMENT IS ESTOPPED FROM DENYING THAT IT HAD ACCEPTED THE RISKS INVOLVED INCIDENT TO THE CONTROL AND USE OF THE BUILDING.

FURTHERMORE, UNDER THE RULE OF LAW STATED IN YOUR DECISION, 15 COMP. GEN. 876, 879, THE CONTRACTOR IS NOT HELD RESPONSIBLE TO REPLACE A STRUCTURE DESTROYED THROUGH THE FAULT OF THE OWNER. IN THE INSTANT CASE, THE CARETAKER WAS ACTING WITHIN THE GENERAL SCOPE OF HIS EMPLOYMENT AS CARETAKER OF THE BUILDING AND IT WOULD APPEAR THAT TO THE BEST OF HIS JUDGMENT HE THOUGHT HE WAS ACTING IN THE BEST INTERESTS OF THE OWNER WHEN HE BUILT THE FIRE. UNDER THE GENERAL PRINCIPLES OF THE LAW OF AGENCY, IT IS BELIEVED THAT THE ACT OF THE CARETAKER IN SUCH CIRCUMSTANCES MUST BE REGARDED AS THE ACT OF HIS PRINCIPAL.

TO DATE THE CONTRACTOR HAS BEEN PAID ONLY THE AMOUNT OF THE ORIGINAL CONTRACT. YOUR ADVICE IS REQUESTED AS TO WHETHER A CHANGE ORDER, AN ORDER FOR EXTRA WORK, OR A SUPPLEMENTAL CONTRACT MAY BE EXECUTED IN THE AMOUNT OF $405.36 TO COVER THE COST OF THE RESTORATION OF THE BOILER.

PERTINENT DATA RELATIVE TO THIS MATTER ARE ENCLOSED.

THE CONTRACTOR'S OBLIGATION IN THE MATTER OF CARE AND PROTECTION OF THE PROPERTY UNTIL THE TIME OF ITS FINAL INSPECTION AND ACCEPTANCE OF THE GOVERNMENT IS SET FORTH IN ARTICLES 10 AND 16 (C) OF THE CONTRACT, AS FOLLOWS:

ARTICLE 10. PERMITS AND RESPONSIBILITY FOR WORK.--- THE CONTRACTOR SHALL, WITHOUT ADDITIONAL EXPENSE TO THE GOVERNMENT, OBTAIN ALL REQUIRED LICENSES AND PERMITS AND BE RESPONSIBLE FOR ALL DAMAGES TO PERSONS OR PROPERTY THAT OCCUR AS A RESULT OF HIS FAULT OR NEGLIGENCE IN CONNECTION WITH THE PROSECUTION OF THE WORK, AND SHALL BE RESPONSIBLE FOR ALL MATERIALS DELIVERED AND WORK PERFORMED UNTIL COMPLETION AND FINAL ACCEPTANCE. UPON COMPLETION OF THE CONTRACT THE WORK SHALL BE DELIVERED COMPLETE AND UNDAMAGED.

ARTICLE 16. * * *

(C) ALL MATERIALS AND WORK COVERED BY PARTIAL PAYMENTS MADE SHALL THEREUPON BECOME THE SOLE PROPERTY OF THE GOVERNMENT, BUT THIS PROVISION SHALL NOT BE CONSTRUED AS RELIEVING THE CONTRACTOR FROM THE SOLE RESPONSIBILITY FOR ALL MATERIALS AND WORK UPON WHICH PAYMENTS HAVE BEEN MADE OR THE RESTORATION OF ANY DAMAGED WORK, OR AS A WAIVER OF THE RIGHT OF THE GOVERNMENT TO REQUIRE THE FULFILLMENT OF ALL OF THE TERMS OF THE CONTRACT.

ALSO MATERIAL TO A DETERMINATION OF THE ISSUES HERE INVOLVED, ARE THE TERMS AND CONDITIONS OF PARAGRAPH 14 OF THE APPLICABLE SPECIFICATIONS, AS FOLLOWS:

14. OWNERSHIP.--- ALL PARTS AND MATERIALS PAID FOR SHALL BECOME THEREBY THE SOLE PROPERTY OF THE UNITED STATES, BUT THIS PROVISION SHALL NOT BE INTERPRETED AS RELIEVING THE CONTRACTOR FROM THE SOLE RESPONSIBILITY FOR THE PROPER CARE AND PROTECTION OF SAID PARTS AND MATERIALS PRIOR TO THE COMPLETION OF THE WORK AND ITS FINAL ACCEPTANCE BY THE UNITED STATES, OR FROM ANY OTHER OF THE PROVISIONS OF THIS CONTRACT; NOR SHALL THIS PROVISION BE INTERPRETED AS PREVENTING THE CONTRACTING OFFICER FROM REQUIRING THE CONTRACTOR TO STORE AND HANDLE THE PARTS AND MATERIALS SO AS TO PRESERVE THEM FROM DANGER.

IF ANY MATERIALS OR PARTS OF THE WORK BE LOST, DAMAGED OR DESTROYED BY ANY CAUSE OR MEANS WHATSOEVER, THE CONTRACTOR SHALL SATISFACTORILY REPAIR OR REPLACE THE SAME AT HIS OWN COST AND SHALL BE RESPONSIBLE FOR DELAYS OR INCIDENTAL EXPENSES THAT MAY RESULT THEREFROM.

CONCEDING THAT, AS YOU STATE, THE PROJECT SUBSTANTIALLY WAS COMPLETED AS EARLY AS AUGUST 30, 1944, AND THAT THE GOVERNMENT HAD ENJOYED THE BENEFICIAL USE AND OCCUPANCY OF THE PREMISES FROM SUCH DATE UNTIL OCTOBER 20, 1944--- WHEN THE BOILER WAS IRREPARABLY DAMAGED, NECESSITATING ITS REPLACEMENT--- SUCH CIRCUMSTANCES OF THEMSELVES, MAY NOT BE CONSIDERED AS RELIEVING THE CONTRACTOR OF THE RESPONSIBILITY FOR "ALL MATERIALS AND WORK PERFORMED UNTIL COMPLETION AND FINAL ACCEPTANCE," OF ITS OBLIGATION TO REPAIR OR REPLACE, AT ITS OWN EXPENSE, ANY MATERIALS OR PARTS OF THE WORK DAMAGED OR DESTROYED "BY ANY CAUSE OR MEANS WHATSOEVER," OR OF ITS OBLIGATION TO DELIVER THE ENTIRE STRUCTURE TO THE GOVERNMENT IN A COMPLETE AND UNDAMAGED CONDITION, AS EXPRESSLY PROVIDED FOR IN THE ABOVE-QUOTED PROVISIONS OF THE SAID CONTRACT. SEE 16 COMP. GEN. 975, AND THE CASES THEREIN CITED. IN THE PRESENT CASE, IT IS TO BE NOTED THAT, AT THE TIME OF THE REPORTED DESTRUCTION OF THE BOILER, ALL OF THE WORK REQUIRED TO BE PERFORMED BY THE CONTRACTOR HAD NOT BEEN PERFORMED, AS THE TESTING OF THE HEATING SYSTEM--- PROVIDED FOR IN SECTION 178 OF THE SPECIFICATIONS -- STILL REMAINED TO BE DONE. ALSO, FINAL INSPECTION AND ACCEPTANCE OF THE PROJECT AS A WHOLE PRESUMABLY HAD NOT BEEN MADE BY YOUR DEPARTMENT. THIS LATTER RESPECT, THE PRESENT CASE IS DISTINGUISHABLE FROM THE CASE CONSIDERED IN THE DECISION IN 15 COMP. GEN. 876, CITED BY YOU, WHEREIN IT WAS HELD, QUOTING FROM THE SYLLABUS:

A CONTRACTOR NEED NOT BE REQUIRED TO REPAIR A PUBLIC BUILDING CONSTRUCTED BY HIM AND DAMAGED BY AN EXPLOSION OF GAS WHICH ENTERED THE BUILDING FROM A BROKEN GAS MAIN WHERE THE BUILDING WAS COMPLETED, ACCEPTED, AND OCCUPIED AT THE TIME OF THE EXPLOSION, NOTWITHSTANDING FINAL SETTLEMENT UNDER THE CONTRACT WAS DELAYED BECAUSE OF MINOR FINANCIAL ADJUSTMENTS. (ITALICS SUPPLIED.)

HENCE, IN VIEW OF THE CLEAR AND UNEQUIVOCAL TERMS OF THE INSTANT CONTRACT AND THE FACTS HEREIN PRESENT, I CANNOT AGREE THAT, BY REASON OF THE GOVERNMENT'S OCCUPANCY OF THE PREMISES AND THE OTHER CIRCUMSTANCES REFERRED TO IN YOUR LETTER, THE UNITED STATES IS ESTOPPED FROM DENYING THAT IT HAD ACCEPTED THE RISKS INCIDENT TO THE CONTROL, USE OR OCCUPANCY OF THE BUILDING.

HOWEVER, THERE IS FOR CONSIDERATION WHETHER THE OBLIGATION ASSUMED BY THE CONTRACTOR WITH RESPECT TO RESPONSIBILITY FOR THE WORK AND MATERIALS EXTENDED TO A SITUATION, SUCH AS THE PRESENT ONE, WHEREIN THE DAMAGE TO THE EQUIPMENT RESULTED SOLELY FROM AN ACT OF A GOVERNMENT EMPLOYEE ACTING WITHIN THE GENERAL SCOPE OF HIS EMPLOYMENT.

IN THE CASE OF PENN BRIDGE COMPANY V. CITY OF NEW ORLEANS ( C.A.A., 5TH), 222 F. 737, THERE WAS PRESENTED THE QUESTION OF THE LIABILITY OF A CONTRACTOR FOR DAMAGE TO WORK BEING PERFORMED ON PROPERTY BEING CONSTRUCTED SUBJECT TO A STATUTORY PROVISION WHICH IMPOSED A RESPONSIBILITY UPON THE CONTRACTOR SIMILAR TO THAT IMPOSED BY THE TERMS OF THE INSTANT CONTRACT. IN THAT CASE THE DAMAGE WAS ATTRIBUTABLE TO SOME ACT OR OMISSION OF THE PERSON FOR WHOM THE WORK WAS BEING PERFORMED. THE CONTRACTOR SUED FOR RECOVERY OF THE VALUE OF WORK PERFORMED ON A BRIDGE WHICH COLLAPSED PRIOR TO ITS COMPLETION AS A RESULT OF FAULTY PLANS AND SPECIFICATIONS FURNISHED BY THE OTHER PARTY. PERFORMANCE OF THE CONTRACT WAS SUBJECT TO A PROVISION IN THE CIVIL CODE OF LOUISIANA WHICH REQUIRED THE BUILDER TO ASSUME ALL RISK OF LOSS OR DESTRUCTION OF THE WORK "IN WHATEVER MANNER IT MAY HAPPEN, PREVIOUS TO ITS BEING DELIVERED TO THE OWNER.' IN RULING UPON THE SAID PROVISION, THE COURT HELD THAT IT HAD NO APPLICATION TO A SITUATION WHERE DESTRUCTION OF THE WORK WAS "DUE TO THE OWNER'S FAULT WHILE IT IS STILL INCOMPLETE IN THE HANDS OF THE CONTRACTOR," AND STATED THAT:

* * * IN STATING THE BUILDER'S RESPONSIBILITY FOR THE STRUCTURE BEFORE ITS DELIVERY TO THE OWNER, IT IS NOT TO BE SUPPOSED, IN THE ABSENCE OF A CLEAR MANIFESTATION OF A PURPOSE IN THAT REGARD, THAT THE LEGISLATURE HAD IN MIND AN INJURY CAUSED BY THE OWNER HIMSELF, OR INTENDED TO CHARGE THE BUILDER WITH LIABILITY THEREFOR. IN ANOTHER CASE, N. RISLEY AND SONS V. OCEAN CITY DEVELOPMENT COMPANY, 75 N.J.L. 840, 69 A. 192, THERE WAS INVOLVED THE DETERMINATION OF THE CONTRACTOR'S LIABILITY UNDER A CONTRACT CLAUSE PROVIDING THAT "ALL THE CONSTRUCTION COVERED BY THIS CONTRACT SHALL, UNTIL FINAL PAYMENT AND ACCEPTANCE BY THE COMPANY, REMAIN AT THE SOLE RISK AND EXPENSE OF THE CONTRACTOR.' THE FACTS INDICATED THAT THE DESTRUCTION OF THE WORK WAS DUE, IN PART, TO THE FAULT OF THE COMPANY, AND THE COURT SAID:

* * * UPON THIS CLAUSE THE DEFENDANT RELIED TO SUSTAIN HIS CONTENTION THAT THE RISK OF THE WASH-OUT WAS UPON THE PLAINTIFF UNTIL THE WORK WAS ENTIRELY COMPLETED, OR WAS ACCEPTED BY THE COMPANY. THE RISKS IMPOSED UPON THE CONTRACTOR UNDOUBTEDLY INCLUDED SUCH CATASTROPHIES AS THOSE OVER WHICH THE PLAINTIFFS HAD NO CONTROL, SUCH, FOR INSTANCE, AS EXTRAORDINARY STORMS, OR EARTHQUAKES, AND INCLUDED RISKS CONCERNING WHICH THERE WAS NO DUTY RESTING UPON THE PLAINTIFF; BUT NO ONE WOULD IMAGINE THAT THE LOSS OF SAND CAUSED BY THE WILLFUL ACT OF THE DEFENDANT WOULD STILL BE AT THE RISK OF THE PLAINTIFF. NOR CAN IT BE CONCEDED THAT IF THE LOSS OCCURRED THROUGH A NEGLIGENT ACT OF THE DEFENDANT, BY A BREACH OF SOME DUTY IMPOSED UPON THE DEFENDANT TO DEFEND OR PRESERVE THE SAND, HE COULD NEVERTHELESS INVOKE THIS CLAUSE OF THE CONTRACT. * * * ALSO, SEE C. W. HUNT CO. V. BOSTON ELEVATED RY. CO., 85 N.E. 446; MCCONNELL V. CORONA CITY WATER CO., 85 P. 929; LONG CO. V. UNITED STATES, 79 C. CLS. 656; AND SEXTON V. UNITED STATES, 82 ID. 550.

THUS, WHILE IT IS CLEAR THAT, UNDER THE TERMS OF THE INSTANT CONTRACT, THE CONTRACTOR WAS REQUIRED TO ASSUME THE RISK OF DAMAGE TO, OR DESTRUCTION OF THE PROPERTY--- OCCURRING AT ANY TIME PRIOR TO ITS FINAL INSPECTION AND ACCEPTANCE BY THE GOVERNMENT--- IN THE EVENT SUCH DAMAGE OR DESTRUCTION WAS CAUSED BY AN ACT OF THE CONTRACTOR OR BY SOME OCCURRENCE BEYOND THE CONTROL OF EITHER PARTY, SUCH LIABILITY COULD NOT REASONABLY BE EXPECTED TO EXTEND TO A SITUATION WHERE THE DAMAGE RESULTED SOLELY FROM A NEGLIGENT ACT OF AN EMPLOYEE OF THE GOVERNMENT ACTING WITHIN THE SCOPE OF HIS EMPLOYMENT. ACCORDINGLY, YOU ARE ADVISED THAT, UNDER THE FACTS HEREIN PRESENT, THE CONTRACTOR IS ENTITLED TO PAYMENT FOR REPLACING THE DESTROYED FURNACE BOILER. WITH REFERENCE TO THE REQUEST CONTAINED IN THE NEXT TO THE LAST PARAGRAPH OF YOUR ABOVE-QUOTED LETTER I HAVE TO ADVISE THAT, ASIDE FROM THE FACT THAT SINCE THE CONTRACT HAS BEEN COMPLETED AND FINAL PAYMENT HAS BEEN MADE THERE NO LONGER EXISTS A CONTRACT WHICH LEGALLY MAY BE MODIFIED OR AMENDED, THE ISSUANCE OF A CHANGE ORDER, AN ORDER FOR EXTRA WORK, OR A SUPPLEMENTAL CONTRACT AS SUCH WOULD NOT BE PROPER UNDER THE REPORTED CIRCUMSTANCES.

ARTICLE 3 OF THE CONTRACT AUTHORIZES THE ISSUANCE OF WRITTEN ORDERS BASED ON CHANGES IN THE DRAWINGS OR SPECIFICATIONS BUT, OBVIOUSLY, THE RESTORATION WORK HERE INVOLVED WAS NOT DUE TO CHANGES IN THE DRAWINGS OR SPECIFICATION AND, THEREFORE, SUCH WORK DOES NOT COME WITHIN THE SCOPE OF SAID ARTICLE. NOR WAS THE REPLACEMENT OF THE BOILER EXTRA WORK WITHIN THE MEANING OF THE CONTRACT PROVISIONS WITH REFERENCE TO EXTRA WORK. PARAGRAPH 11 OF THE SPECIFICATIONS PROVIDES THAT THE CONTRACTOR SHALL PERFORM ALL EXTRA WORK NOT COVERED BY THE SPECIFICATIONS WHICH MAY BE NECESSARY OR EXPEDIENT TO CARRY OUT THE INTENT OF THE CONTRACT, OR INCIDENTAL IN ANY WAY TO THE WORK OF THE CONTRACT, WHICH IS ORDERED IN WRITING. THE WORK HERE INVOLVED DOES NOT COME WITHIN SUCH PARAGRAPH BECAUSE THE FURNISHING OF A BOILER WAS COVERED BY THE SPECIFICATIONS AND THE PROVISION RELATING TO EXTRA WORK APPLIES ONLY TO WORK NOT COVERED BY THE SPECIFICATIONS. IN THIS CONNECTION ATTENTION IS INVITED TO THE COMMENTS OF THE COURTS IN SOMEWHAT SIMILAR CIRCUMSTANCES. THE CASE OF C. W. HUNT CO. V. BOSTON ELEVATED RY. CO., SUPRA, INVOLVED A CLAIM ON ACCOUNT OF NEW PARTS FURNISHED BY A CONTRACTOR TO REPLACE PARTS OF MACHINERY BROKEN THROUGH THE NEGLIGENCE OR INEXPERIENCE OF THE PURCHASER'S EMPLOYEES PRIOR TO FINAL COMPLETION AND ACCEPTANCE OF THE CONTRACT WORK. ALLOWING RECOVERY, IT WAS STATED BY THE AUDITOR, AND APPROVED BY THE COURT, AS FOLLOWS:

THE EXTRAS FOR WHICH I RULE THAT THE HUNT COMPANY IS ENTITLED TO RECOVER ARE SUCH AS WERE SUPPLIED TO TAKE THE PLACE OF PARTS OF THE MACHINERY BROKEN THROUGH THE NEGLIGENCE OR INEXPERIENCE OF THE RAILWAY COMPANY'S EMPLOYEES, OR TO TAKE THE PLACE OF PARTS OF THE APPARATUS WHICH WERE WORN OUT IN THE OPERATION OF THE TOWERS BY THE RAILWAY COMPANY. MANY OF THESE THINGS WERE FURNISHED BEFORE THE TOWERS WERE COMPLETED OR READY TO TURN OVER, BUT THEY CANNOT BE REGARDED AS ALTERATIONS OR ADDITIONS OF MATERIALS OR LABOR WITHIN THE MEANING OF SPECIFICATIONS (SECTION 36), WHICH THE VICE PRESIDENT MIGHT ORDER, AND WHICH, IF ORDERED, WERE TO BE ORDERED BY HIM IN WRITING. THEY WERE OUTSIDE THE CONTRACT ALTOGETHER. THE RAILWAY COMPANY UNDERTOOK TO OPERATE THE TOWERS BEFORE THEY WERE COMPLETED, FOR ITS OWN ADVANTAGE AS WELL AS FOR THE ADVANTAGE OF THE HUNT COMPANY, AND EXTRAS OF THE KIND I DESCRIBE SHOULD BE PAID FOR JUST AS MUCH AS IF THE TOWERS HAD BEEN TURNED OVER COMPLETED AT THE TIME WHEN THE RAILWAY COMPANY'S ENGINEERS BEGAN TO OPERATE THEM. * * * (ITALICS SUPPLIED.) IN LONG CO. V. UNITED STATES, 79 C.1CLS. 656, 666, IN ALLOWING RECOVERY FOR REMOVAL OF MATERIAL NECESSITATED BY A CAVE-IN FOR WHICH THE UNITED STATES HAD BEEN RESPONSIBLE, THE COURT STATED:

THE REMOVAL OF THE 4,639 CUBIC YARDS OF MATERIAL THAT FELL INTO THE TUNNEL AS A RESULT OF THE CAVE-IN WAS NOT COVERED IN ANY PROVISION OF THE CONTRACT, ALTHOUGH ITS REMOVAL WAS NECESSARY TO THE COMPLETION OF THE CONTRACT. IT WAS NOT EXTRA WORK WITHIN THE MEANING OF ARTICLES 6 AND 7 OF THE CONTRACT WHICH REQUIRED A CHANGE ORDER OR AN AGREEMENT IN WRITING TO ENTITLE THE PLAINTIFF TO COMPENSATION FOR ITS PERFORMANCE. IT WAS ADDITIONAL WORK, NOT WITHIN THE CONTEMPLATION OF THE PARTIES WHEN THE CONTRACT WAS MADE, PERFORMED BY PLAINTIFF AT THE INSTANCE AND DIRECTION OF AN AUTHORIZED REPRESENTATIVE OF THE UNITED STATES, THE CONTRACTING OFFICER. THE DEFENDANT RECEIVED THE FULL BENEFIT OF THE ADDITIONAL WORK. IN THESE CIRCUMSTANCES THE PLAINTIFF IS ENTITLED TO RECOVER THE REASONABLE VALUE OF THE ADDITIONAL SERVICES RENDERED, AS UPON AN IMPLIED CONTRACT. * * (ITALICS SUPPLIED.) AND IN THE CASE OF MCCONNELL V. CORONA CITY WATER CO., 85 P. 929, INVOLVING FACTS QUITE SIMILAR TO THOSE IN THE LONG CO. CASE, SUPRA, THE COURT STATED:

* * * UNDER SUCH CIRCUMSTANCES, NOTWITHSTANDING THAT THE CONTRACT IS INDIVISIBLE, THERE CAN BE NO HESITATION IN SAYING THAT THE CONTRACTOR'S RESPONSIBILITY FOR ANY COMPLETED PORTION OF THE WORK, SO DONE UNDER THE DIRECTION AND TO THE SATISFACTION OF THE ENGINEERS, RELIEVES HIM FROM RESPONSIBILITY FOR SUCH AN ACCIDENT AS THAT WHICH BEFELL, THAT THE RESPONSIBILITY FOR SUCH ACTION MUST REST ON THE DEFENDANT, AND THAT, NOTWITHSTANDING THAT THE CONTRACT WAS ENTIRE AND INDIVISIBLE, PLAINTIFF WAS UNDER NO MORE COMPULSION TO PERFORM THE EXTRA WORK OF REPAIRING THE CAVE IN THE TUNNEL SO OCCURRING THAN HE WOULD HAVE BEEN IF IT HAD BEEN OCCASIONED BY A WILLFUL ACT OF DESTRUCTION UPON THE PART OF THE DEFENDANT. * * * (ITALICS SUPPLIED.)

SINCE, AS SHOWN ABOVE, THE CONTRACTOR WAS NOT LEGALLY BOUND UNDER THE CONTRACT TO REPLACE THE BOILER, THE SUBSEQUENT AGREEMENT UNDER WHICH THE BOILER WAS REPLACED CANNOT BE REGARDED AS OBLIGATING THE PRIME CONTRACT APPROPRIATION. WHILE IT IS NOT NECESSARY TO RELY UPON AN IMPLIED CONTRACT IN THIS CASE, BECAUSE IT APPEARS THERE WAS AN EXPRESS AGREEMENT BETWEEN THE PARTIES, THE OBLIGATION MUST BE REGARDED AS FIRST ARISING WHEN THE AGREEMENT WAS ENTERED INTO AND THE WORK WAS PERFORMED. THE PRIME CONTRACT APPROPRIATION, CONTAINED IN THE DISTRICT OF COLUMBIA APPROPRIATION ACT, 1944, 57 STAT. 312, 336, IS AVAILABLE ONLY FOR OBLIGATIONS PROPERLY INCURRED WITHIN THE FISCAL YEAR 1944. 18 COMP. GEN. 969. THE OBLIGATION TO PAY THE CONTRACTOR FOR THE REPLACEMENT OF THE BOILER, BEING SEPARATE AND APART FROM THE ORIGINAL CONTRACT AND IN EFFECT RESULTING IN A NEW CONTRACT, DID NOT ARISE UNTIL THE FISCAL YEAR 1945. ACCORDINGLY, SUCH AMOUNT AS IS DUE THE CONTRACTOR FOR THE REPLACEMENT, PROPERLY IS CHARGEABLE TO THE APPLICABLE APPROPRIATION FOR THE FISCAL YEAR 1945.

THE ABOVE STATEMENT TO THE EFFECT THAT THERE WAS AN EXPRESS CONTRACT WITH RESPECT TO REPLACEMENT OF THE DAMAGED BOILER IS BASED ON THE STATEMENT IN YOUR LETTER THAT THE " PARK SERVICE ENGINEERS, ON BEHALF OF THE CONTRACTING OFFICER, REACHED AN AGREEMENT WITH THE CONTRACTOR THAT HE SHOULD REPLACE THE DESTROYED BOILER AND REPAIR THE DAMAGES ON AN ACTUAL COST BASIS.' IN SUPPORT OF SUCH STATEMENT YOU REFER TO A LETTER ON NOVEMBER 2, 1944, FROM THE CONTRACTOR TO THE CONTRACTING OFFICER AND ITS ENCLOSURE, BEING MEMORANDUM OF NOVEMBER 1, 1944, SIGNED BY THE SUBCONTRACTOR, WHICH PURPORTS TO CONFIRM THE ORAL AGREEMENT REACHED. THE RECORD INDICATES THAT THE SAID MEMORANDUM OF NOVEMBER 1, 1944, CORRECTLY SETS FORTH THE ORAL AGREEMENT, AND SINCE THE SUM OF $405.36 CLAIMED IS BASED ON THE PRECISE TERMS THEREOF, THE ENTIRE AMOUNT MAY BE PAID TO THE CONTRACTOR. A COPY OF THIS DECISION SHOULD BE ATTACHED TO THE VOUCHER ON WHICH THE PAYMENT IS MADE.