Trade customs.-General and universal customs applicable to the trade or business are binding upon buyer and seller unless there is a notice or contractual stipulation that the transaction is without regard to the custom. Vulcanite Cement Co. v. U. S. (1932), 74 Ct. Cl. 693.

Contract price; in general.-Contractor may recover full purchase price of canned goods sold Quartermaster Corps which complied with only standard specified. Wabash Valley Packing Co. v. U. S. (1927), 63 Ct. Cl. 344.

Contractor, required to follow plans, cannot be denied compensation because work in accord with plans does not develop intended results. Dayton-Wright Co. v. U. S. (1928), 64 Ct. Cl. 544.

Where the Government mistakenly contracts for, and the contractor furnishes, certain office equipment, the fact that it was not of the particular character desired, and which the contracting officer thought was being contracted for, does not release the Government from its obligation to accept the equipment and pay the purchase price. Ferris v. U. S. (1933), 77 Ct. Cl. 294.

Advance payments.-Where under a supplemental contract the contractor is advanced a sum of money by the United States for working capital, repayment to be made by deductions from vouchers presented for work done, with interest on balances due, secured by an interest-bearing promissory note, and the principal contract is canceled by the United States before any deliveries are possible thereunder, the note so given is to be considered merely collateral security, and the United States upon settlement is due the principal sum, with interest not on the note, but only on the advancement, computed from the date of the advancement to the date of cancelation of the principal contract. Lutz Co. v. U. S. (1932), 76 Ct. Cl. 405.

Where the plaintiff contracted to furnish coal to the Government the ash content of which was specified at 9 per cent, with reduction in price in case the ash exceeded by more than 2 per cent the specified 9 per cent, the Government was entitled to the specified reduction in price where the ash exceeded over 12 per cent; and it was immaterial that plaintiff prior to the execution of the contract told the Government's officials an error had been made in the bid. Perryman-Burns Coal Co. v. U. S. (1937), 84 Ct. Cl. 567.

Existing contract at lower price.Where airplane radiators were ordered by the Government and supplied by a contractor under a procurement order which provided for a price of $45.00 each, the contractor was entitled to the price specified, notwithstanding there was existing another contract between the Government and the contractor for supplying similar radiators at $39.00 each. Marlin-Rockwell Corp. v. U. S. (1935), 80 Ct. Cl. 394.

Performance after expiration.-Acceptance of delivery under an executory contract after the time set therein is a waiver of the time limitation, and the buyer is liable for the agreed price. Kentucky Oxygen-Hydrogen Co. v. U. S. (1932), 75 Ct. Cl. 687.

Variable price.-Where a contractor's proposal stating that the amount of his bid for the contract work was based, among other things, upon certain specified Government prices for materials and the then market price of labor was accepted by the Government and made a part of the contract, and the contractor refused to sign the contract until assured that under its provisions he would be entitled to a revision of the contract price in case of an advance in the price of labor, the contract is to be construed as providing for such revision, and also for revision in the case of advance in the price of materials.

Where the government paid for cloth delivered under a contract which provided that any of the cloth rejected by the Government 136307-40-21

crease in the prices of labor or materials is not limited to the contract period for performance of the contract where there was delay in completion of the contract and the delay was caused both by the contractor and

by the Government. Monks et al., Exrs. v. U. S. (1934), 79 Ct. Cl. 302.

Variance from estimates.-Where a contract for a dredging project, at unit rates, states the yardage estimated as necessary to be dredged to complete the work, but provides that "the United States reserves the right to require the removal of such yardage as will complete the work, be it more or less than the quantity above estimated," the words "more or less" must be given a more extensive meaning than in their ordinary use for denoting slight variations in estimated amounts, and the contract held to require the completion of the project. Morris & Cumings Dredging Co. v. U. S. (1933), 78 Ct. Cl. 511.

Withholding by Government.-A provision in a Government contract that payment of the contract price is to be made upon completion and acceptance of the contract work and upon presentation of satisfactory evidence that all obligations of the contractor against the contract had been paid in full, did not, after completion and acceptance of the work, authorize the withholding of payment by the Government until the contractor | should present satisfactory evidence that it had paid all sums due from it to its materialmen; and where payment was being so withheld, the contractor is entitled to recover as damages the expense in securing payment incurred by reason of the Government's failure to pay as provided for by the contract. & Co. v. U. S. (1934), 80 Ct. Cl. 325. Fraud. The burden of proving fraud in the "Proof, statement, establishment, or allowance of any claim or any part of any claim against the United States" (sec. 172, Judicial Code), is upon the defendant in a suit against the United States. Carroll et al. v. U. S. (1932), 76 Ct. Cl. 103.

King

Where a subcontractor violates his principal's agreement with the Government by carrying on the operations in such a manner as to work a fraud upon the Government, and the Government officers stop the principal contractor's pay, until the amount due may be ascertained, the contractor is not thereby given a right to cease performing.

The fraud contemplated by section 172, Judicial Code (U. S. C., Title 28, sec. 279) is not fraud in the performance of a contract, but fraud in the prosecution of a claim. Fraud by a subcontractor, in the performance of a contract, in the absence of knowledge of or approval by the prime contractor or a plaintiff representative of the prime contractor, is not the fraud of such prime contractor or plaintiff. Baird V. U. S. (1933), 76 Ct. Cl. 599.

Upon finding and conclusion that the plaintiff attempted to and did practice a fraud against the United States in the proof and establishment of his claim by changing certain entries in his books of account after

their introduction in evidence by him in support of the claim, the claim held and adjudged forfeited to the Government under the provisions of section 172 of the Judicial Code; Title 28, section 279, U. S. Code. Blume v. U. S. (1935), 81 Ct. Cl. 210.

Liquidated damages; in general. The rule is now well established that parties to a contract may agree upon liquidated damages, not by way of penalty, but in lieu of actual damages, and whether such is the agreement is to be determined by the intention of the parties as disclosed by the language used. Hickey v. U. S. (1928), 65 Ct. Cl. 729; MacDonald et al. v. U. S. (1932), 74 Ct. Cl. 572. Where liquidated damages are provided for specified delays, such damages are not to be construed as a penalty merely because it is also provided that delay shall not be charged in case one of the parties certifies it has not been damaged thereby. Id.

Where there is no proof that actual damages have been sustained, and where party claiming damages is equally at fault, and amount of delay caused by either party cannot be ascertained with reasonable accuracy, liquidated damages will not be allowed. U. S. v. United Engineering & Contracting Company, 234 U. S. 236, 242; Wyant v. U. S., 46 Ct. Cl. 205; Monks et al., Exrs. v. U. S., 79 Ct. Cl. 302, 338. Wharton Green & Co., Inc. v. U. S. (1937), 86 Ct. Cl. 100, certiorari denied, 303 U. S. 661.

Change orders.-Where a construction contract authorizes the Government to make changes in the specifications as the work progresses, and change orders issued during the contract period, pursuant thereto. increasing the contract price, stipulate that no change in time for completion is involved, and the orders are accepted, the contractor is not entitled to recover liquidated damages imposed upon him for delay in completion due to work performed under the change orders. Griffiths v. U. S. (1932), 74 Ct. CI. 245.

Where extra work is performed under an order therefor issued after the fixed date for completion of a contract, a provision in the order that it would involve no extension of time for completion is meaningless, for if enforced it would impose upon the contractor liquidated damages for delay no matter how expeditiously the extra work was performed. (Plack et al. v. United States, 66 Ct. Cl. 641, 651). Sun Shipbuilding Co. v. U. S. (1932), 76 Ct. Cl. 154.

Computation. A construction contract provided that the work was to be completed within a certain time from the date of receipt of notice from the Government to begin work. The contractor, having signed the contract, was ready to begin work ten days before receipt of said notice: Held, that this period was not within that provided for completion, and could not be used as a basis

for remission of liquidated damages or any part thereof. Griffiths v. U. S. (1932), 74 Ct. Cl. 245.

Where a contract for delivery of goods exacts liquidated damages in case of delay, each lot to be considered a unit for the purpose of calculating damages, liquidated damages are to be determined for each day's delay beyond the time specified for each lot at the rate agreed upon, and the lots may not be aggregated as one lot for that purpose. Rosenberg v. U. S. (1933), 76 Ct. Cl. 662.

Where by contract or by law an act is to be performed within a specified period of time from or after a particular day or event, the time limit for the performance of the act is, under the modern doctrine of interpetation to be determined by excluding the particular day or the day of the particular event specified. International Manufacturers' Co. v. U. S. (1937), 85 Ct. Cl. 683.

Contract terminated.-Where, upon failure of the contractor to complete a Government construction contract within the contract time, the Government terminated the contract and completed the work pursuant to a provision in the contract therefor and for payment by the contractor of any excess in the cost of the work to the Government over the contract price, the contractor was not liable for liquidated damages under a provision of the contract for liquidated damages for delay in completion of the work by him. The Fidelity & Casualty Company of New York v. U. S. (1935), 81 Ct. Cl. 495. The plaintiff was surety on the bond of the Murphy Plumbing Co. for the performance of its contract with the Government for certain plumbing in a United States veterans' hospital. Under the contract the Government, for lack of diligence in the performance of the contract, could either terminate the contractor's right to continue performance and have the work completed at the contracttor's expense, for any extra cost, or it could permit the contractor to continue and complete performance and then charge it liquidated damage for any delay in completion. After part performance the contractor abandoned the work, and the Government terminated the contract, and permitted the plaintiff to complete the work. Held, that the termination of the contract eliminated the liquidated damage clause, and that the Government was therefore not entitled to liquidated damage for delay in the completion of the contract work. Commercial Casualty Insurance Co. v. U. S. (1936), 83 Ct. Cl. 367.

hem Steel Co. v. U. S. (1932), 75 Ct. Cl. 845. Where delays caused by the respective parties to a contract are capable of ascertainment, the contractor, in order to be relieved of liquidated damages for delay, must show lack of responsibility for the delay. Francc-American Construction Co. v. U. S. (1932), 76 Ct. Cl. 132.

Where both parties are responsible for delay in completion of a contract and it is Impossible to ascertain the true balance by setting off one against the other, no liquidated damages can be assessed. Sun Shipbuilding Co. v. U. S. (1932), 76 Ct. Cl. 154.

Delays chargeable to contractor.Where a subcontract sets no time for delivery of the articles which are to be employed in the prime contract, the Government contractor is not in position to plead that the delay caused by the subcontractor was beyond his own control. Hickey v. U. S. (1928), 65 Ct. Cl. 729; MacDonald et al. v. U. S. (1932), 74 Ct. Cl. 572.

A contractor is not relieved from his obligation to install a specified kind of fixtures merely because of their cost or of their being out of stock and more difficult to obtain than they otherwise would have been; nor is he relieved of liability for liquidated damages for delay in the procuring and installation of such fixtures beyond the contract time for completion of the work where he reasonably could have procured and installed them within the contract time. Griffiths v. U. S. (1933), 77 Ct. Cl. 542.

Delays chargeable to Government.--Where a contract provides that in assessment of liquidated damages contractor shall receive credit for all delays which contracting officer may determine to have been due to action of U. S. or other unavoidable causes, it shall not be construed as a basis for action by contractor against U. S. for damages, but as merely affording credit to contractor against its own delays. Wheeling Mold & Foundry Co. v. U. S. (1927), 63 Ct. Cl. 353.

Where a Government contract provided for completion of the contract work within a specified period of time and for liquidated damages for delay in completion of the work, and the time for completion was extended by the Government for a period equal to such part of the delay as was caused by the Government, the contractor was liable for liquidated damages for the additional delay in the completion of the work. Schuler & McDonald v. U. S. (1937), 85 Ct. Cl. 631.

able against the contractor. Arundel Corp. v. U. S. (1934), 79 Ct. Cl. 343.

Waiver by Government.-Partial occupancy of an unfinished building, where the Government has not yet accepted it, is not a waiver by the Government of liquidated damages for delay in completion. Hickey v. U. S. (1928), 65 Ct. Cl. 729; MacDonald et al v. U. S. (1932), 74 Ct. Cl. 572. Mistake.-Federal harbor dredging contract, made under mutual mistake of fact as to quantity of hardpan in area to be dredged, was voidable and could have been rescinded by contractor.

Parties contracting on faith of erroneous assumption that certain state of facts exists should be relieved from their bargain, whether mistake is intrinsic or extrinsic or whether it affects identity or quality.

ment. Bausch & Lomb Optical Co. v. U. S. (1934), 78 Ct. Cl. 584.

Contract price. Where delays have occurred in the progress of agreed work, and a supplemental contract is entered into extending the time for completion and fixing a new contract price, the presumption is that the new price included compensation for the delays previously occurring. Snare & Triest Co. v. U. S. (1932), 75 Ct. Cl. 326.

Duress. Where under duress by Government officials a second contract is entered into under the terms of which the contractor receives less compensation, the contractor is not estopped by receipt and retention of the lesser amount from continuing to assert its claim under the original contract. Farmers & Ginners Cotton Oil Co. v. U. S. (1932), 76 Ct. Cl. 294.

Liquidated damages. Where a

Modification or supplemental agreements; consideration.-Where the provisions of a contract are changed by a subsequent agreement between the same parties, such agreement has no force and effect unless there is some consideration moving to the party adversely affected by such changes. Nor is the second agreement made valid by the fact that the first contract is not completely performed. Vulcanite Cement Co. v. U. S. (1932), 74 Ct. Cl. 693.

Where due to delays by Government a supplemental contract is entered into increasing the price of the work remaining to be done, the breach furnishes the basis for a new consideration. See Worthington Pump Corp. v. U. S. (1928), 66 Ct. Cl. 230. American Bridge Co. v. U. S. (1931), 72 Ct. Cl. 344.

Where, in the performance of a Government contract, there were mutual delays preventing completion within the contract time, and the contractor, in order to secure an extension of the time for performance, and under protest, signed a supplemental contract agreeing to pay a certain percentage of the contract price as a consideration for such extension, the contract was without consideration, and void. Camp Sales Corp. v. U. S. (1933), 77 Ct. Cl. 659.

tract is entered into cancelling a portion of the quantity of articles to be manufactured and delivered under the original contract, reinstating them in the supplemental contract at a new price, and omitting the clause carried in the original contract for liquidated damages in case of delay, the contractor is not liable for liquidated damages on the articles so reinstated. Bethlehem Steel Co. v. U. S. (1932), 75 Ct. Cl. 845.

Performance; authority to extend time.— When a board authorized by the contract to entertain a request for extension of time for performance, receives and passes upon such request on its merits, the provision that the request must be presented within a specified time is waived.

Where the decision of a board authorized to determine the responsibility for delays is by the contract made final, and there is no proof of bad faith on its part, the contractor may not recover damages for the delay which the board has found him responsible for. Pope v. U. S. (1932), 75 Ct. Cl. 436.

(1) The provision in a contract that the decision of a designated officer or officers as to extensions of time for completion shall be binding upon the contractor, is a valid one and in the absence of fraud or such gross mistake as would necessarily imply bad faith, or a failure to exercise an honest judgment, their decision in the premises will not be set aside by the court.

(2) This rule is not affected by the failure of the contractor to apply for an extension within the time set by the contract, such failure operating under the terms of the contract merely as a waiver by him of the right to an extension. Carroll et al. v. U. S. (1932), 76 Ct. Cl. 103.

ments of the contract except a requirement that the bearings should not pound nor heat,

Limitation of time.-Where the Government agreed to furnish the necessary foundations for structural framework to be erected by the contractor, and neglected to furnish the foundations in sufficient time to enable the contractor to proceed at the agreed rate, the delay was unauthorized under the usual clause in contracts excusing delays on the part of the Government, there being no change in specifications for the foundations. American Bridge Co. v. U. S. (1931), 72 Ct. CL. 344.

Where time is of the essence of a contract and the Government by its delay prevents performance by the contractor within the contract time, such delay by the Government will operate to waive the time limit and give the contractor a reasonable time in which to perform. But where the necessary approval of a contract by a superior officer was delayed by the Government beyond the date fixed for commencement of the contract work, and the delay did not prevent performance by the contractor within the contract time, the time limit for performance was not waived, but the contractor was entitled to an extension of the contract time equal to such delay. Griffiths v. U. S. (1933), 77 Ct. Cl. 542.

Where one party to a contract demands strict compliance by the other party as to the time limit for performance, he must comply with all the conditions of the contract necessary to enable the other party to so perform, and failure on his part to do so will operate to waive the time limit and permit performance within a reasonable time. Camp Sales Corp. v. U. S. (1933), 77 Ct. Cl. 659.

Where impossible.-Where the Government specifications for balloon cloth are found by the contractor, and are in fact, impossible of performance by him or anyone else, the Government may not require performance under revised specifications at the original price without the consent of the contractor. Rosenberg v. U. S. (1933), 76 Ct. CL. 662.

were due, not to any fault of the contractor, but to preexisting defects in the subbases and crankcases of the engines, the correction of which was not within the requirements of the contract, the contractor is entitled to the contract price for performance. Acme Machine & Welding Co. v. U. S. (1936), 83 Ct. Cl. 331.

Abandonment of contract.-Exclusive contractor for laundry work at Army cantonment held not entitled to recover profits lost by abandonment of work. National Laundry Co. v. U. S. (1927), 63 Ct. Cl. 626.

Alteration and improvement of leased premises.-Where a written lease of a building by the Government for postoffice purposes was canceled by the Government in accordance with a right of cancellation reserved in the lease, the lessors are not entitled, in the absence of a provision in the lease therefor, to payment by the Government of any part of the cost of alterations and improvements made by them as an inducement to or condition of the Government's entering into the lease. Goldstein v. U. S. (1934), 79 Ct. Cl. 477.

Bonus.-Contractor manufacturing articles for Government may recover "premium" provided for deliveries in certain months where deliveries were made during months stipulated. Littauer v. U. S. (1927), 63 Ct. Cl. 112.

Cancellation by Government.-Shipping Board held not excused from performing contract for fuel oil because of decrease in business. Atlantic Gulf Oil Corporation v. U. S. (1928), 64 Ct. Cl. 162.

Though there might be obligation under fuel oil contract to take oil left in ground, uncertainty of quantity precluded money judgment. Id.

Plaintiff, as the lowest bidder, contracted with the Navy Department to supply certain railroad ties. After a portion of the ties had been delivered and paid for, the Government notified plaintiff that the contract "was erroneously awarded to you," and "any portion of the ties called for under this contract which have not now been delivered are hereby canceled." Defendant proceeded to purchase ties elsewhere at a lower price, and plaintiff was compelled to sell the undelivered portion on a declining market. Held, plaintiff entitled to recover the difference between the market-price and the contract price, together with certain underpayments on ties delivered and accepted. Briggs & Co. v. U. S. (1932), 74 Ct. Cl. 347.

Where the proof is that no profit could be made on raw material left on a contractor's